C.H. Robinson fourth-quarter earnings: first look

With comparisons on a year-to-year basis for C.H. Robinson having been strong for several quarters, investors had turned to sequential comparisons to see how the overhaul of the giant 3PL was progressing under CEO David Bozeman, who has been in his role since June 2023.

The latest quarterly earnings of C.H. Robinson released Wednesday showed some slowdown using the comparison to the third quarter as a guide. But there were also gains. Profitability comparisons to a year earlier were extremely strong.

For example, gross profits in the fourth quarter were up 10.4% from a year ago at $672.9 million. But they were down from the third quarter figure of $723.8 million, a decline of 7%.

However, income from operations was slightly improved over the third quarter, rising to $183.8 million from $180.1 million. On a year-on-year basis, the increase was 71.1%.

The adjusted operating margin was up 940 basis points from a year ago at 26.8%. Sequentially, the increase took it up from 24.5% in the third quarter.

The adjusted operating margin, which excludes the impact of restructuring charges and divestiture costs, was up 1,020 bps to 26.8%. But sequentially, it was down from 32.9%.

Diluted earnings per share were up significantly on a sequential basis, rising to $1.22 from 80 cents. From a year ago, the diluted EPS figure was up 369.2%.

C.H. Robinson as a whole showed a decline in revenue both from the third quarter and from a year ago. Fourth-quarter revenue was $4.184 billion, down from $4.221 billion a year ago. Third-quarter revenue was $4.278 billion. Part of that was driven by a drop in its Global Forwarding business, which at $883.97 million was down year on year and sequentially.

The overall decline in revenue can also be seen in the North American Surface Transportation group, which houses the company’s core brokerage activities. Revenue in NAST was $2.8 billion in the fourth quarter. That was down 6.6% from a year earlier but was also down from the $2.93 billion from the third quarter, a decline of 4.4%.

While profitability in NAST rose 6.2% from a year ago, it was down from the third quarter. Gross profits fell to $403.7 million, a decline from the third-quarter figure of $420.7 million.

According to SeekingAlpha, the non-GAAP EPS of $1.21 per share beat the estimates of analysts by 10 cents per share. But revenue of $4.18 billion fell short of consensus estimates by $260 million.

While C.H. Robinson was a high-flying stock following its first-quarter earnings, which were the first to reflect some of the cost-cutting and reorganization steps taken by Bozeman, it has been largely flat the past three months. For the 12 months, according to Barchart, the stock is up 25.8%. The first reaction in the market Wednesday to the numbers was a decline of approximately 0.75%. That three-month period of overall standing still does include a boost the stock got when Bozeman held court at an investors’ day in New York in mid-December.