Trucking slowdown causes Robinson to miss on earnings

C.H. Robinson Worldwide Inc., a third-party logistics firm that matches shippers with available transportation, told analysts Tuesday that it doesn't know when the trucking business will improve.

Citing a continuing trend of slower growth and smaller margins in its shipping business, the Eden Prairie firm missed Wall Street expectations in its first quarter. It earned $103.3 million, or 64 cents per share, compared with the 69 cents expected by Wall Street analysts.

The company reported after the market closed.

While Robinson shares rose 1.97 percent to close at $61.56 during the market's Tuesday rally, Robinson shares shed 6.4 percent, or nearly $4 a share, in after-hours trading to $57.61.

Revenue was almost exactly what Wall Street had been expecting, $2.99 billion, compared with Wall Street's anticipation of $2.98 billion.

Robinson, which ships by truck, rail, air and sea, depends primarily on its trucking business.

On a conference call with analysts, C.H. Robinson CEO John Wiehoff said the firm's truckload business profit margins continued to be hurt in the first quarter because its costs rose 2.5 percent, while, because of contractual relationships with customers, it was only able to charge 1.5 percent more.

"We believe the truckload markets will return at some point, but we don't know when," Wiehoff said. "We do feel that for long-term value creation it's really important that we continue to take market share."

The company clearly has been doing that, said Matt Young, an analyst for Morningstar in Chicago.

Robinson is growing revenue a little faster than the rest of the trucking industry, "which means they're taking market share," Young said. But gross margins remain under pressure, he said.

"We remain positive in our long-term performance outlook," Wiehoff said. "Our investments, including the acquisitions executed last year, continue to drive our revenue growth and ability to service the global supply chains needs of our customers."