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November 6, 2018 1:30 PM, EST

Expeditors International Posts Record Profits, Net Revenue in 3Q

Expeditors International logo on door Expeditors International

Expeditors International of Washington Inc. achieved record profits and net revenue in the third quarter as the Seattle-based air and ocean freight forwarder benefited from lower taxes and kept ahead of rising transportation costs in a tight-capacity market.

The company reported net income of $162.7 million, or 92 cents a share, in the three months ended Sept. 30. That compares with net income of $120.3 million, or 66 cents a share, in the same period a year ago. Net revenue, which is total revenue minus the cost of purchased transportation, rose 10% to $661.3 million in the third quarter of 2018 from $599.1 million in 2017. Top-line revenue increased 16% to $2.09 billion from $1.8 billion.

Musser

Musser

CEO Jeffrey Musser said air and ocean freight-hauling capacity remains tight in many lanes, giving carriers an opportunity to increase pricing and raising costs for freight forwarders such as Expeditors.

“That presented a challenge, particularly in ocean, requiring that we work our strong relationships to secure space for our customers while remaining disciplined on pricing,” Musser said in a statement Nov. 6.

Senior Vice President and Chief Financial Officer Bradley Powell said operating profits as a percentage of net revenue topped 30% in the quarter as revenue gains outpaced increases in expenses. Airfreight tonnage rose 1% in the quarter, and ocean container volume increased 8% over the prior year.

Lower tax rates helped the company’s bottom line as well, with the effective tax rate of 21.8% in the third quarter of 2018 versus 36.7% in 2017.

Expeditors International ranks No. 5 on the Transport Topics Top 50 list of largest logistics companies in North America.