Ryder Tops Overall, Guides for 2013 - Analyst Blog
Ryder System Inc.
), one of the world's largest providers of integrated logistics
and transportation solutions, reported stellar fourth quarter and
full-year 2012 results. The outperformance was backed by strong
contributions from all business units along with greater number
of used vehicle sales plus lower selling and administrative
Quarterly adjusted earnings were $1.17, which surpassed the Zacks Consensus Estimate of $1.10 and increased 21% from 97 cents in the year-ago quarter.
The company registered revenues of 1,583.5 million in the fourth quarter, beating the Zacks Consensus Estimate of $1,562 million. Comparing year over year, the results improved 3% from $1,541.1 million.
Operating revenue (total revenue less Fleet Management Solutions fuel and all subcontracted transportation) increased 4% year over year to $1,287.6 million, driven by better full service lease contracts plus higher volumes.
For full-year 2012, Ryder witnessed earnings of $4.04 per share (beating our projection by 2% and increasing 16% year over year), on revenues of $6,257.0 million (up 3% from the prior year).
Fleet Management Solutions: Total revenue increased 4% year over year to $1,117.7 million in the fourth quarter. The growth was based on higher Contractual revenues and other revenues that increased 5% and 14%, respectively. The growth in Contractual revenues was backed by increased full service lease. Operating revenue for the segment moved up 4% year over year to $849.5 million.
Supply Chain Solutions: The segment includes operational activities of the company's Dedicated Contract Carriage business. Total revenue was $575.3 million in the fourth quarter, up 2% from the year-ago period. Operating revenue (excluding subcontracted transportation) also grew 4% year over year to $489.1 million. The year-over-year growth was primarily based on higher volumes in automotive and dedicated contract carriage.
Liquidity and Cash Flow
Ryder System ended 2012 with cash and cash equivalents of $66.4 million compared with $104.6 at year-end 2011. The company had long-term debt (including current portion) of $3,820.8 million, representing debt-to-capitalization ratio of 72.2%. Cash from operations in 2012 was $1,134.1 million, while net capital expenditure amounted to $1,617.8 million.
Management expects first quarter 2013 earnings in the range of 75 cents to 80 cents share, 9% to 16% higher than the first-quarter 2012 result. For 2013, Ryder expects earnings in the range of $4.70 to $4.85 per share, reflecting year-over-year growth of 7% to 10%.
Among other related companies, United Parcel Service Inc. ( UPS ) has released its fourth quarter results today, while FedEx Corporation ( FDX ) is expected to release the same on Mar 20.
A stock in the transportation and supply chain industry worth a look include Aircastle LTD ( AYR ), which has a Zacks Rank #1 (Strong Buy).
Ryder currently holds a Zacks Rank #2, implying a Buy rating. We believe that the company continues to benefit from fleet management services and used vehicle sales. In addition, strategic acquisitions and increased investments on vehicles provide long-term growth opportunities for the stock.
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