Summary
Expeditors International of Washington, Inc. (EXPD) filed its 2010 Form 10-K for the fiscal year ended December 31, 2009. The report details the company's operations as a global logistics provider, focusing on air and ocean freight forwarding and customs brokerage. The year 2009 was significantly impacted by the global economic downturn, leading to a decline in volumes and net revenues across most service lines, a situation described as unprecedented in the company's history. Despite the challenging economic environment, Expeditors maintained its non-asset based business model, relying on strong relationships with carriers and a global network. The company highlighted its commitment to organic growth, superior customer service, and employee development through its unique compensation structure. Significant ongoing legal proceedings, including investigations by the U.S. Department of Justice and the European Commission regarding alleged anti-competitive behavior in the freight forwarding industry, are noted as a material risk and source of potential future costs and penalties.
Financial Highlights
48 data points| Revenue | $4.09B |
| Gross Profit | $1.38B |
| Operating Expenses | $3.71B |
| Operating Income | $385.00M |
| Interest Expense | $499K |
| Net Income | $240.22M |
| EPS (Basic) | $1.13 |
| EPS (Diluted) | $1.11 |
| Shares Outstanding (Basic) | 212.11M |
| Shares Outstanding (Diluted) | 216.53M |
Key Highlights
- 1The year 2009 saw a significant decline in net revenues and operating income compared to 2008 and 2007, primarily attributed to the global economic downturn impacting freight volumes.
- 2Expeditors operates a non-asset-based model, meaning it does not own aircraft or steamships, which provides flexibility but also exposes it to risks associated with third-party carrier stability and pricing.
- 3The company is facing significant legal challenges, including investigations by the U.S. Department of Justice and the European Commission concerning alleged anti-competitive practices in the air cargo freight forwarding industry.
- 4Customs brokerage and other services represented the largest portion of net revenues (41% in 2009), followed by airfreight services (35%) and ocean freight services (24%).
- 5Expeditors emphasizes organic growth supplemented by strategic acquisitions and attributes its success to a unique employee compensation system that rewards profitability and fosters a strong corporate culture focused on customer service.
- 6The company reported substantial cash and cash equivalents at year-end 2009, with no long-term debt, indicating a strong liquidity position.
- 7Seasonality is a factor, with the first quarter traditionally being the weakest and the third and fourth quarters the strongest for operating results.