Expeditors International Post Significant Third Quarter Profit Increase

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Expeditors International of Washington posted profit and revenue gains in the third quarter as the logistics company took advantage of tight freight capacity and soaring prices.

The Seattle-based company said its net income rose 88% to $ 359 million in the third quarter, or $ 2.09 in diluted earnings per share, from $ 191.3 million, $ 1.12, in the during the same period a year earlier. Revenue jumped 84% to $ 4.3 billion in the third quarter, from $ 2.3 billion a year earlier.

“There just isn’t enough equipment, warehouse and dock space, or people in the places where they are needed to significantly reduce large freight backlogs. Managing record volumes under these conditions has not been easy, but we continue to set company performance records, ”CEO Jeffrey Musser said in a November 2 statement.

Musser said the global supply chain was plagued by a critical shortage of air cargo capacity due to reduced passenger belly space on international routes as airlines cut their schedules in due to the COVID-19 pandemic.

“Despite increased use of charter flights, there is insufficient capacity to meet the current high demand,” Musser said.

At the same time, ports are experiencing “unprecedented congestion” caused by labor and equipment shortages.

“The entire global infrastructure for the movement of goods remains stretched beyond its limits. While some ocean ports are particularly constrained, especially on the west coast of the United States, many of the current bottlenecks stem from supply and infrastructure issues that were developing long before the pandemic, ”Musser said.

Lockdowns, closures and spikes in demand for certain products resulting from the pandemic “have exposed and exacerbated these long-simmering problems. Unfortunately, there is no simple or immediate solution. As a result, we believe that these current conditions are likely to last until 2022, ”he said.

But Expeditors has learned to manage disruption to operate profitably, said CFO Bradley Powell.

“While our performance is exceptionally good under these difficult circumstances, I continue to caution that we are unable to predict how long current conditions will persist or the impact they will have on our future operations. “said Powell.

The company reported $ 1.63 billion in air cargo service revenue, up 65.6% from the third quarter of 2020.

It recorded $ 1.6 billion in freight and marine services revenue, a 162% increase from the same period a year earlier.

Revenues from its customs brokerage and other services activities jumped 44.6% to $ 1.1 billion.

The company continues to increase its number of jobs and now employs 19,034 people, 7.3% more than at the end of the third quarter of 2020. Most of the growth has occurred in North America and in Europe.

Expeditors ranks 4th on the Transport Topics Top 50 list of the largest logistics companies in North America.

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