8-KOther Events

EXPEDITORS INTERNATIONAL OF WASHINGTON INC 8-K Report (Sep 20, 2001)

Filed September 20, 2001For Securities:EXPD

Summary

This 8-K filing from Expeditors International of Washington Inc. (EXPD), dated September 20, 2001, addresses the operational and financial impact of the September 11th terrorist attacks on the company and the broader logistics industry. The filing includes a question-and-answer format to clarify the company's response to the unprecedented disruption, emphasizing that while the company did not lose employees, some experienced personal losses. Key operational updates indicate that international flights have resumed for U.S. and non-U.S. carriers, with backlogs in Asia clearing well and in Europe clearing more slowly. The FAA has implemented new procedures allowing cargo and mail to travel on passenger aircraft. Expeditors reassures investors about its compliance with evolving security regulations and its financial capacity to adapt to any necessary system or equipment changes. The company also confirms ongoing efforts to keep customers informed via its web technology.

Key Highlights

  • 1International flights have resumed for U.S. and non-U.S. flag carriers following the September 11th events.
  • 2Cargo backlogs out of Asia are clearing effectively; backlogs in Europe are clearing but at a slower pace.
  • 3The FAA has issued new procedures allowing cargo and mail to be transported on passenger aircraft.
  • 4Expeditors did not lose any employees due to the terrorist attacks, though some employees lost family members.
  • 5The company is compliant with all applicable security guidelines and has the financial flexibility to invest in necessary system or equipment upgrades.
  • 6Expeditors has authorized a discretionary program for the repurchase of up to 1,000,000 shares of common stock.
  • 7The filing highlights the global nature of the disruption and the interdependence of the global economy.

Frequently Asked Questions

International flights for both U.S. and non-U.S. flag carriers have resumed. The cargo backlog out of Asia is clearing up well, while the backlog in Europe is clearing more slowly. The FAA has also issued new procedures permitting cargo and mail to move on the same aircraft as passengers.

Expeditors is compliant with all applicable security guidelines and is confident in its ability to remain compliant with any alterations to requirements. The company has the technological control to implement system changes promptly and has a strong balance sheet to fund any necessary capital equipment investments. They view security costs as a given for non-asset based global logistics companies, not a differentiating factor for investment.

While airlines are considering capacity reductions, it is too early to quantify the exact impact. However, it is expected that reduced capacity could lead to increased market rates. Expeditors notes that there was already unused capacity in the market and believes that rate stabilization is beneficial in the long term once a new equilibrium is established.

Yes, simultaneously with the release of this report, Expeditors announced that its Board of Directors has authorized a discretionary program to repurchase up to 1,000,000 shares of its common stock.