Radiant Logistics said it has seen some pull forward in volumes ahead of a potential Oct. 1 strike by dockworkers at East and Gulf Coast ports. This is in addition to some shippers moving freight ahead of the traditional peak season due to potential changes in U.S. trade policy.
The Renton, Washington-based 3PL’s founder and CEO, Bohn Crain, wouldn’t handicap the likelihood of a strike but said on a Thursday evening call with analysts, “To the extent that happens, we’ll be here to support our customers with diversions and other ways to solve the problem.”
He also said Radiant has seen steady “tightening” on the West Coast the past several months as shippers have sought to avoid a potential work disruption on the East Coast.
Radiant (NYSE: RLGT) reported adjusted earnings per share of 14 cents for its fiscal quarter ended June 30. The result was 4 cents better than the consensus estimate compiled by Yahoo Finance and 1 cent higher year over year. Revenue of $206 million was 11% lower y/y with adjusted earnings before interest, taxes, depreciation and amortization nearly flat at $9.1 million.
Revenue net of purchased transportation expenses fell 9% to $61 million, producing a 29.4% net revenue margin, which was 80 basis points higher y/y.
Crain said the fiscal third quarter that ended March 31 was the bottom of the cycle for Radiant. Revenue was up 12% sequentially from the March quarter to the June quarter. Recently, the company has seen a slight uptick in volumes and revenue per transaction. Crain believes the June quarter is the likely near-term run rate for Radiant as there really aren’t any material catalysts to push demand higher.
Table: Radiant’s key performance indicators
Radiant generated $17 million in cash from operations in its fiscal year (also ended June 30) despite completing six acquisitions. The company ended the quarter with $25 million in cash and no outstanding balance on a $200 million credit facility.
Crain said the company will use the balance sheet to continue to be acquisitive.
“As previously discussed, we believe we are well positioned to navigate through these slower freight markets as we find our way back to more normalized market conditions,” Crain stated in a news release. “At the same time, we remain focused on delivering profitable growth through a combination of organic and acquisition initiatives and thoughtfully re-levering our balance sheet through a combination of agent station conversions, synergistic tuck-in acquisitions, and stock buy-backs.”
Radiant repurchased $4.1 million in stock during the fiscal year. The company has a $331 million market cap.
Shares of RLGT were 6.2% higher at 11:25 a.m. EDT on Friday compared to the S&P 500, which was 0.6% higher.
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