Echo Global Logistics Announces Third Quarter 2012 Results
Echo reported Non-GAAP net income of
"Echo posted another strong quarter in terms of its revenue growth, achieving record revenue of over
Third Quarter Highlights
- Total revenue was
$192.7 million , an increase of 21.3% from the third quarter of 2011. - Non-GAAP operating income totaled
$6.3 million , an increase of 18.8% from the third quarter of 2011.* - Non-GAAP operating margin was 17.3%, down 11 bps from the third quarter of 2011.*
- Non-GAAP net income increased 15.7% from the third quarter of 2011 to
$3.8 million .* - Non-GAAP fully diluted EPS increased 14.1% from the third quarter of 2011 to
17 cents per share.*
* All non-GAAP measures exclude the effects of changes in contingent consideration payable. For a reconciliation of each non-GAAP financial measure to the nearest comparable GAAP measure, see "Reconciliation to GAAP Operating Income, Operating Margin, Net Income and Fully Diluted EPS" included in this release.
Summarized financial results and select operating metrics follow:
Amounts in 000,000s, except per Three months ended
share data September 30,
2012 2011 % change
(unaudited)
---------------------- ----------
Revenue
Transactional $ 132.5 $ 108.4 22.3%
Enterprise $ 60.2 $ 50.6 19.0%
---------- ---------- ----------
Total revenue 192.7 159.0 21.3%
Net revenue 36.6 30.6 19.5%
Operating expenses
Commissions 10.4 9.3 11.7%
Selling, general and
administrative 17.6 13.8 27.3%
Depreciation and amortization 2.3 2.2 5.5%
---------- ---------- ----------
Total operating expenses (1) 30.3 25.3 19.7%
---------- ---------- ----------
Non-GAAP Operating income (1) 6.3 5.3 18.8%
---------- ---------- ----------
Other expense 0.1 0.1 51.8%
---------- ---------- ----------
Non-GAAP Income before taxes (1) 6.2 5.2 18.3%
---------- ---------- ----------
Income taxes (1) 2.4 1.9 22.5%
---------- ---------- ----------
Non-GAAP Net income (2) 3.8 3.3 15.7%
========== ========== ==========
---------- ---------- ----------
Non-GAAP EPS (2) $ 0.17 $ 0.15 14.1%
========== ========== ==========
Diluted shares 22.9 22.6
Reconciliation to GAAP Operating
Income, Operating Margin, Net
Income and EPS
Non-GAAP Operating income (1) 6.3 5.3 18.8%
Change in contingent consideration
payable (0.0) 0.1 -98.1%
---------- ---------- ----------
Operating income 6.3 5.4 15.9%
---------- ---------- ----------
Non-GAAP Operating margin (1) 17.3% 17.4% (11) bps
Effect of change in contingent
consideration payable 0.0% 0.4% (42) bps
---------- ---------- ----------
Operating margin (% of Net revenue) 17.3% 17.8% (53) bps
---------- ---------- ----------
Non-GAAP Net income (2) 3.8 3.3 15.7%
Change in contingent consideration
payable, net of tax effect (0.0) 0.1 -101.9%
---------- ---------- ----------
Net Income 3.8 3.4 12.9%
========== ========== ==========
Non-GAAP Fully diluted EPS (2) $ 0.17 $ 0.15 14.1%
Change in contingent consideration
payable, net of tax effect (0.00) 0.00 -101.8%
---------- ---------- ----------
Fully diluted EPS $ 0.17 $ 0.15 11.3%
========== ========== ==========
Operating Metrics
Net revenue margin 19.0% 19.3% (28) bps
Operating margin (% of net
revenue) (1) 17.3% 17.4% (11) bps
Shipment volume 427,147 355,972 20.0%
Number of enterprise clients 197 169 16.6%
Total employees 1,286 1,180 9.0%
Salaried employees 440 380 15.8%
Commissioned sales employees 595 545 9.2%
Sales agents 251 255 -1.6%
Less Than Truckload (LTL) Revenue
% 45.7% 46.8% (113) bps
Truckload (TL) Revenue % 44.7% 44.7% (5) bps
(1) Amounts shown exclude the effects of changes in contingent consideration
payable.
(2) Amounts shown exclude the tax effected changes in contingent
consideration payable.
"Our third quarter results were largely driven by the organic growth in our business, as our enterprise revenue increased by 19% and our revenue per transactional sales representative also increased by over 15%," said
Business Outlook
Waggoner stated, "Based on the current operating environment as well as the anticipated growth that will result in the fourth quarter from our recent acquisition of Sharp Freight Systems, we anticipate our fourth quarter revenue to be in the range of
Conference Call
A conference call, with accompanying presentation slides, will be broadcast live on
Non-GAAP Financial Measures
This release includes the following financial measures defined as "non-GAAP financial measures" by the
Non-GAAP Operating Income, Non-GAAP Operating Margin, Non-GAAP Net Income and Non-GAAP Fully Diluted EPS are used by management in its financial and operational decision-making and evaluation of overall operating performance. Non-GAAP Operating Income, Non-GAAP Operating Margin, Non-GAAP Net Income and Non-GAAP Fully Diluted EPS may be different from similar measures used by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles. For a reconciliation of each non-GAAP financial measure to the nearest comparable GAAP measure, see "Reconciliation to GAAP Operating Income, Operating Margin, Net Income and Fully Diluted EPS" included in this release.
Forward-Looking Statements
This release contains statements relating to future results. These statements are forward-looking statements under the federal securities laws. We can give no assurance that any future results discussed in these statements will be achieved. Any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. These statements are subject to a variety of risks and uncertainties that could cause our actual results to differ materially from the statements contained in this release. For a discussion of important factors that could affect our actual results, please refer to our
Echo Global Logistics, Inc.
Condensed Consolidated Statements of Operations
Three Months Ended Nine Months Ended
September 30, September 30,
2012 2011 2012 2011
(Unaudited) (Unaudited)
------------------------- -------------------------
REVENUE $192,737,761 $158,956,001 $546,537,567 $439,906,043
COSTS AND EXPENSES
Transportation costs 156,145,239 128,336,597 442,475,163 354,474,127
Selling, general, and
administrative
expenses 27,977,727 22,994,195 80,324,572 65,540,057
Depreciation and
amortization 2,294,608 2,174,371 6,510,261 6,152,762
------------ ------------ ------------ ------------
INCOME FROM OPERATIONS 6,320,187 5,450,838 17,227,571 13,739,097
OTHER EXPENSE (121,857) (80,273) (359,831) (219,291)
------------ ------------ ------------ ------------
INCOME BEFORE PROVISION
FOR INCOME TAXES 6,198,330 5,370,565 16,867,740 13,519,806
INCOME TAX EXPENSE (2,381,394) (1,991,064) (6,336,180) (5,003,592)
------------ ------------ ------------ ------------
NET INCOME $ 3,816,936 $ 3,379,501 $ 10,531,560 $ 8,516,214
============ ============ ============ ============
Basic net income per
share $ 0.17 $ 0.15 $ 0.47 $ 0.38
Diluted net income per
share $ 0.17 $ 0.15 $ 0.46 $ 0.38
Echo Global Logistics, Inc.
Condensed Consolidated Balance Sheets
September 30, December 31,
2012 2011
(Unaudited)
-------------- --------------
Cash and cash equivalents $ 48,167,633 $ 47,007,309
Accounts receivable, net of allowance for
doubtful accounts 100,442,704 89,191,456
Prepaid expenses 2,465,107 4,634,612
Other current assets 139,419 800,648
Total long term assets 63,189,069 58,864,061
-------------- --------------
Total assets $ 214,403,932 $ 200,498,086
============== ==============
Accounts payable - trade $ 60,331,993 $ 59,949,927
Current maturities of capital lease
obligations 43,398 175,166
Other liabilites 12,026,484 10,474,434
Deferred income taxes 2,613,046 2,979,483
Long term liabilities 5,808,848 7,597,478
Stockholders' equity 133,580,163 119,321,598
-------------- --------------
Total liabilities and stockholders' equity $ 214,403,932 $ 200,498,086
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Echo Global Logistics, Inc.
Condensed Consolidated Statements of Cash Flows
Nine Months Ended
September 30,
2012 2011
(Unaudited) (Unaudited)
------------- -------------
Net cash provided by operating activities $ 13,045,704 $ 8,944,787
Net cash used in investing activities (10,435,299) (7,717,889)
Net cash provided by (used in) financing
activities (1,450,081) (254,679)
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Increase/(decrease) in cash and cash
equivalents 1,160,324 972,219
Cash and cash equivalents, beginning of period 47,007,309 43,218,164
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Cash and cash equivalents, end of period $ 48,167,633 $ 44,190,383
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