UTi Worldwide Reports Fiscal 2013 Second Quarter Results

LONG BEACH, Calif., Sept. 6, 2012 (GLOBE NEWSWIRE) -- UTi Worldwide Inc. (Nasdaq:UTIW) today reported financial results for its fiscal 2013 second quarter ended July 31, 2012.

Fiscal Second Quarter 2013 vs. 2012 Results:
  • Revenues were $1,155.8 million, a decrease of 10.9 percent from $1,297.4 million.  
  • Net revenues (revenues minus purchased transportation costs) were $406.1 million, a decrease of 8.4 percent from $443.4 million.  
  • Net income attributable to UTi Worldwide Inc. was $18.9 million, or $0.18 per diluted share, compared to $22.9 million, or $0.22 per diluted share.  
  • After-tax severance costs were $1.4 million, compared to $2.4 million.  
  • Excluding severance costs, adjusted net income attributable to UTi Worldwide Inc. was $20.3 million, or $0.20 per diluted share, compared to $25.3 million, or $0.24 per diluted share.  
  • The impact from currency translation reduced net income by approximately $0.03 per diluted share, compared to the fiscal 2012 second quarter.    
  • All references to adjusted items and organic items in this release refer to non-GAAP results. A reconciliation of GAAP to these non-GAAP results is provided in the supplemental financial information attached to this release.

Eric W. Kirchner, chief executive officer, said, "The anemic global economy and weak freight environment continued to weigh on results in our fiscal 2013 second quarter, which together with currency translation led to a 10.9 percent decline in revenues. Trends apparent throughout the industry in the first quarter continued into the second, with companies still favoring ocean freight over airfreight and lower weight per shipment. In addition, clients have become increasingly careful in their freight and logistics spending. Airfreight was once again impacted more than other modes, with tonnage falling 11 percent compared to the second quarter last year. Transportation rates in ocean freight have risen significantly this year, putting pressure on yields and net revenue per unit. Contract logistics and distribution was stable in the second quarter. Revenues in the segment were lower than the same period last year primarily due to currency effects, while operating income improved."

Kirchner continued, "Our transformation is expected to deliver long-term operating margin expansion, which will position the company well when the economic and freight environment improves. While we are optimistic on the long-term outlook, we see little to suggest that the trends that impacted results in the first half of fiscal 2013 will change in the second half of the year. While we don't control external factors, we do remain vigilant in controlling costs and driving increased sales. The deployment of our new financial and freight forwarding operating system continues, and we remain on track to achieve our long-term operating margin goals."  

Revenues decreased 10.9 percent in the fiscal 2013 second quarter compared to the prior-year second quarter, primarily due to the impact of currency, lower pricing and weaker airfreight tonnage. These negative factors were partially offset by increased contract logistics and distribution activity in the Africa and Asia-Pacific regions. Net revenues fell 8.4 percent in the fiscal 2013 second quarter, primarily due to currency translation and lower airfreight volumes. On an organic basis, revenues decreased 3.3 percent, while net revenues increased 0.7 percent in the fiscal 2013 second quarter compared to the same period last year.

Operating expenses less purchased transportation costs were $373.0 million in the second quarter of fiscal 2013, compared to $403.7 million in the same period last year. Severance costs (before taxes) totaled $2.1 million in the fiscal 2013 second quarter, compared to $3.5 million in the second quarter of last year. Severance costs in both periods were primarily related to the company's transformation activities.

Excluding severance costs from both periods, adjusted operating expenses less purchased transportation costs were $370.9 million in the fiscal 2013 second quarter, a decrease of 7.3 percent from $400.2 million in the same period last year, primarily due to currency effects. On an organic basis, adjusted operating expenses less purchased transportation costs increased 1.7 percent, compared to the same period last year.

Operating income in the fiscal 2013 second quarter was $33.0 million. Excluding the severance costs described above, adjusted operating income was $35.2 million, or 8.7 percent of net revenues. This compares to adjusted operating income in the year-ago second quarter of $43.2 million, or 9.7 percent of net revenues.

Investor Conference Call:

UTi management will host an investor conference call today, September 6, 2012, at 8:00 a.m. PDT (11:00 a.m. EDT) to review the company's financial results for the fiscal 2013 second quarter. Investment professionals are invited to participate in the live call by dialing 877-941-8609 (domestic) or 480-629-9692 (international) using conference ID 4559506. The call will be open to all interested investors through a live, listen-only audio Internet broadcast at www.go2uti.com and www.earnings.com . For those who are not available to listen to the live broadcast, the call will be archived for one year at both Web sites. A telephonic playback of the conference call also will be available from approximately 11:00 a.m. PDT, today, through September 9, 2012, by calling 800-406-7325 (domestic) or 303-590-3030 (international) and using replay passcode 4559506 .

About UTi Worldwide:

UTi Worldwide Inc. is an international, non-asset-based supply chain services and solutions company providing air and ocean freight forwarding, contract logistics, customs brokerage, distribution, inbound logistics, truckload brokerage and other supply chain management services. The company serves a large and diverse base of global and local companies, including clients operating in industries with unique supply chain requirements such as the pharmaceutical, retail, apparel, chemical, automotive and technology industries. The company seeks to use its global network, proprietary information technology systems, relationships with transportation providers, and expertise in outsourced logistics services to deliver competitive advantage to each of its clients' supply chains.

Use of Non-GAAP Financial Information:

This press release includes "non-GAAP financial measures" within the meaning of the Securities and Exchange Commission rules. UTi believes that meaningful analysis of its financial performance requires an understanding of the factors underlying that performance and the company's judgments about the likelihood that particular factors will repeat. Short-term patterns and long-term trends may be obscured by the impact of certain items. For this reason, the company has included information in this press release relating to organic revenue and organic net revenue growth, which are adjusted to exclude the impact of currency fluctuations between comparable periods. The company also has referred to operating expenses less purchased transportation costs, and to adjusted operating expenses less purchased transportation costs, which are operating expenses less purchased transportation costs that are further adjusted to exclude severance costs. The company has also included information relating to organic adjusted operating expenses less purchased transportation costs, which are adjusted operating expenses less purchased transportation costs that are further adjusted to exclude the impact of currency fluctuations between comparable periods. The company has further referred to adjusted operating income and adjusted net income, each of which is adjusted to exclude severance costs as described above. This information is among the information the company uses as a basis for evaluating company performance on a comparable basis over time, allocating resources and planning and forecasting of future periods. The company has also provided this information because such adjustments make performance information more comparable to prior disclosures for investors, and may enhance the ability of investors to analyze the company's performance. This information is not intended to be considered in isolation or as a substitute for, or superior to, the relevant measures prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the tables at the end of this press release.

Safe Harbor Statement:

Certain statements in this news release may be deemed to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The company intends that all such statements be subject to the "safe-harbor" provisions contained in those sections. Such forward-looking statements may include, but are not limited to, statements about the continuation of adverse trends for the remainder of fiscal 2013, the long-term outlook for the company and the industry, the company's ability to control costs and increase sales in the near term, the ability of the company's transformation to deliver long-term operating margin expansion and position the company well when the economic and freight environment improves, the status and timing of the company's freight forwarding operating and finance systems, the company's progress in achieving its long-term operating margin goals, and any other statements not of an historical nature. Many important factors may cause the company's actual results to differ materially from those discussed in any such forward-looking statements, including but not limited to: volatility with respect to global trade; global economic, political and market conditions, including those in Africa, Asia and EMENA; risks associated with the company's business transformation initiative; volatile fuel costs; transportation capacity, pricing dynamics and the ability of the company to secure space on third party aircraft, ocean vessels and other modes of transportation; changes in foreign exchange rates; material interruptions in transportation services; risks of international operations; risks associated with, and the potential for penalties, fines, costs and expenses the company may incur as a result of the ongoing publicly announced governmental investigations into the international air freight and air cargo transportation industry and other related investigations and lawsuits; the financial condition of the company's customers; disruptions caused by epidemics, natural disasters, conflicts, wars and terrorism; and the other risks and uncertainties described in "Risk Factors" and "Forward-looking Statements" in the company's Annual Report on Form 10-K/A for the fiscal year ended January 31, 2012, any subsequently filed Quarterly Reports on Form 10-Q and as described in the company's other filings with the Securities and Exchange Commission. In light of the significant uncertainties inherent in the forward-looking information included herein, the inclusion of such information should not be regarded as a representation by UTi or any other person that UTi's objectives or plans will be achieved in the timeframe anticipated or at all. Investors are cautioned not to place undue reliance on the company's forward-looking statements. UTi undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

(Tables Follow)

UTi Worldwide Inc.        
Condensed Consolidated Statements of Income      
(in thousands, except share and per share amounts)      
         
  Three months ended July 31,  Six months ended July 31,
  2012 2011 2012 2011
         
Revenues: (Unaudited) (Unaudited) (Unaudited) (Unaudited)
Airfreight forwarding $ 370,394 $ 465,672 $ 751,534 $ 904,701
Ocean freight forwarding 304,899 320,696 589,606 602,274
Customs brokerage 30,414 33,082 58,680 63,335
Contract logistics 203,818 212,845 405,471 411,824
Distribution 146,514 139,741 295,402 269,094
Other 99,749 125,322 203,378 244,835
Total revenues 1,155,788 1,297,358 2,304,071 2,496,063
         
Operating expenses:        
Purchased transportation costs:        
Airfreight forwarding 286,684 365,880 588,506 716,057
Ocean freight forwarding 253,210 266,618 487,715 500,853
Customs brokerage 1,336 1,206 2,779 2,760
Contract logistics 54,370 53,055 104,353 98,208
Distribution 102,225 95,391 199,232 183,250
Other 51,892 71,812 109,648 140,962
         
Staff costs 225,330 243,135 456,518 476,480
Depreciation  11,229 11,792 22,725 24,233
Amortization of intangible assets 3,160 4,773 6,402 8,228
Severance and other 2,124 3,483 3,824 8,332
Other operating expenses 131,198 140,472 265,799 278,166
Total operating expenses 1,122,758 1,257,617 2,247,501 2,437,529
Operating income 33,030 39,741 56,570 58,534
Interest expense, net (2,494) (3,867) (5,302) (8,091)
Other (expense)/income, net (272) 223 (300) 399
Pretax income 30,264 36,097 50,968 50,842
Provision for income taxes 10,047 11,259 16,521 15,494
Net income 20,217 24,838 34,447 35,348
Net income attributable to noncontrolling interests 1,334 1,965 2,678 3,732
Net income attributable to UTi Worldwide Inc. $ 18,883 $ 22,873 $ 31,769 $ 31,616
         
Basic earnings per common share attributable to UTi Worldwide Inc. common shareholders  $ 0.18 $ 0.22 $ 0.31 $ 0.31
         
Diluted earnings per common share attributable to UTi Worldwide Inc. common shareholders $ 0.18 $ 0.22 $ 0.31 $ 0.31
         
Number of weighted-average common shares outstanding used for per share calculations
 Basic shares 103,609,889 102,660,019 103,323,012 102,389,521
 Diluted shares 103,893,040 103,580,890 103,920,826 103,462,353
     
UTi Worldwide Inc.    
Condensed Consolidated Balance Sheets    
(in thousands)    
     
  July 31,  2012 January 31, 2012
  (Unaudited) (Unaudited)
ASSETS    
     
Cash and cash equivalents $ 262,761 $ 321,761
Trade receivables, net 941,052 947,480
Deferred income taxes 18,033 20,372
Other current assets 151,220 132,545
Total current assets 1,373,066 1,422,158
     
Property, plant and equipment, net 233,720 216,299
Goodwill and other intangible assets, net 537,081 534,237
Investments 963 1,108
Deferred income taxes 37,468 43,272
Other non-current assets 38,127 38,575
     
Total assets $ 2,220,425 $ 2,255,649
     
LIABILITIES & EQUITY    
     
Bank lines of credit $ 102,713 $ 76,240
Short-term borrowings 967 1,019
Current portion of long-term borrowings 24,049 21,775
Current portion of capital lease obligations 11,852 13,768
Trade payables and other accrued liabilities 792,602 859,086
Income taxes payable 8,041 12,657
Deferred income taxes 4,722 1,927
Total current liabilities 944,946 986,472
     
Long-term borrowings, excluding current portion 238,854 231,204
Capital lease obligations, excluding current portion 14,736 15,845
Deferred income taxes 25,469 31,845
Other non-current liabilities  38,593 38,775
     
Commitments and contingencies    
     
UTi Worldwide Inc. shareholders' equity:    
Common stock 497,398 491,073
Retained earnings 529,221 503,675
Accumulated other comprehensive loss (80,907) (55,983)
Total UTi Worldwide Inc. shareholders' equity 945,712 938,765
Non-controlling interests 12,115 12,743
Total equity 957,827 951,508
     
Total liabilities and equity $ 2,220,425 $ 2,255,649
     
UTi Worldwide Inc.    
Condensed Consolidated Statements of Cash Flows    
(in thousands)    
     
  Six months ended  July 31, 
  2012 2011
  (Unaudited)
     
OPERATING ACTIVITIES:    
Net income $ 34,447 $ 35,348
Adjustments to reconcile net income to net cash used in operating activities:  
Share-based compensation costs 7,050 7,368
Depreciation  22,725 24,233
Amortization of intangible assets 6,402 8,228
Amortization of debt issuance costs 658 1,531
Deferred income taxes 3,274 1,650
Uncertain tax positions (250) 337
Excess tax benefits from share-based compensation (132) (483)
Loss/(gain) on disposal of property, plant and equipment 37 (220)
Provision for doubtful accounts 449 2,736
Other  1,146 1,022
Net changes in operating assets and liabilities (90,180) (87,748)
Net cash used in operating activities (14,374) (5,998)
     
INVESTING ACTIVITIES:    
Purchases of property, plant and equipment, excluding software (19,561) (26,768)
Proceeds from disposal of property, plant and equipment 2,332 2,685
Purchases of software and other intangible assets (15,576) (15,085)
Net increase in other non-current assets (1,016) (4,786)
Other 116 (26)
Net cash used in investing activities (33,705) (43,980)
     
FINANCING ACTIVITIES:    
Net borrowings/(repayments) under bank lines of credit 29,677 (72,520)
Net decrease in short-term borrowings (2,333)
Proceeds from issuance of long-term borrowings 1,986 150,213
Repayment of long-term borrowings (11,045) (34,595)
Debt issuance costs (1,098) (2,153)
Repayment of capital lease obligations (9,759) (10,099)
Acquisition of non-controlling interests (1,168)
Distribution to non-controlling interests and other (2,433) (183)
Ordinary shares settled under share-based compensation plans (2,450) (1,800)
Proceeds from issuance of ordinary shares 1,592 1,675
Excess tax benefit from share-based compensation 132 483
Dividends paid (6,223) (6,165)
Net cash provided by financing activities 379 21,355
     
Effect of foreign exchange rate changes on cash and cash equivalents (11,300) 17,606
Net decrease in cash and cash equivalents (59,000) (11,017)
Cash and cash equivalents at beginning of period 321,761 326,795
     
Cash and cash equivalents at end of period $ 262,761 $ 315,778
         
UTi Worldwide Inc.        
Segment Reporting        
(in thousands)        
(Unaudited)        
         
  Three months ended July 31, 2012
  Freight Forwarding Contract Logistics and Distribution Corporate Total
         
Revenues  $ 770,233 $ 385,555 $ — $ 1,155,788
         
Purchased transportation costs 583,504 166,213 749,717
Staff costs 107,602 108,863 8,865 225,330
Depreciation  4,043 6,647 539 11,229
Amortization of intangible assets 1,017 1,603 540 3,160
Severance and other 1,509 283 332 2,124
Other operating expenses 44,421 82,292 4,485 131,198
Total operating expenses 742,096 365,901 14,761 1,122,758
         
Operating income/(loss) $ 28,137 $ 19,654 $ (14,761) 33,030
Interest expense, net       (2,494)
Other expense, net       (272)
Pretax income       30,264
Provision for income taxes       10,047
Net income       20,217
Net income attributable to non-controlling interests       1,334
Net income attributable to UTi Worldwide Inc.       $ 18,883
         
UTi Worldwide Inc.        
Segment Reporting        
(in thousands)        
(Unaudited)        
         
  Three months ended July 31, 2011
  Freight Forwarding Contract Logistics and Distribution Corporate Total
         
Revenues $ 901,752 $ 395,606 $ — $ 1,297,358
         
Purchased transportation costs 694,662 159,300 853,962
Staff costs 114,600 122,237 6,298 243,135
Depreciation  4,440 6,652 700 11,792
Amortization of intangible assets 1,125 2,958 690 4,773
Severance and other 2,124 612 747 3,483
Other operating expenses 50,986 85,066 4,420 140,472
Total operating expenses 867,937 376,825 12,855 1,257,617
         
Operating income/(loss) $ 33,815 $ 18,781 $ (12,855) 39,741
Interest expense, net       (3,867)
Other income, net       223
Pretax income       36,097
Provision for income taxes       11,259
Net income       24,838
Net income attributable to non-controlling interests       1,965
Net income attributable to UTi Worldwide Inc.       $ 22,873
         
UTi Worldwide Inc.        
Segment Reporting        
(in thousands)        
(Unaudited)        
         
  Six months ended July 31, 2012
  Freight Forwarding Contract Logistics and Distribution Corporate Total
         
Revenues $ 1,531,781 $ 772,290 $ — $ 2,304,071
         
Purchased transportation costs 1,168,738 323,495 1,492,233
Staff costs 214,034 224,692 17,792 456,518
Depreciation  8,250 13,400 1,075 22,725
Amortization of intangible assets 2,071 3,251 1,080 6,402
Severance and other 2,176 1,109 539 3,824
Other operating expenses 91,025 166,035 8,739 265,799
Total operating expenses 1,486,294 731,982 29,225 2,247,501
         
Operating income/(loss) $ 45,487 $ 40,308 $ (29,225) 56,570
Interest expense, net       (5,302)
Other expense, net       (300)
Pretax income       50,968
Provision for income taxes       16,521
Net income       34,447
Net income attributable to non-controlling interests       2,678
Net income attributable to UTi Worldwide Inc.       $ 31,769
         
UTi Worldwide Inc.        
Segment Reporting        
(in thousands)        
(Unaudited)        
         
  Six months ended July 31, 2011
  Freight Forwarding Contract Logistics and Distribution Corporate Total
         
Revenues $ 1,731,505 $ 764,558 $ — $ 2,496,063
         
Purchased transportation costs 1,339,912 302,178 1,642,090
Staff costs 224,267 238,950 13,263 476,480
Depreciation  8,828 14,046 1,359 24,233
Amortization of intangible assets 2,211 4,677 1,340 8,228
Severance and other 4,097 3,488 747 8,332
Other operating expenses 99,650 168,822 9,694 278,166
Total operating expenses 1,678,965 732,161 26,403 2,437,529
         
Operating income/(loss) $ 52,540 $ 32,397 $ (26,403) 58,534
Interest expense, net       (8,091)
Other income, net       399
Pretax income       50,842
Provision for income taxes       15,494
Net income       35,348
Net income attributable to non-controlling interests       3,732
Net income attributable to UTi Worldwide Inc.       $ 31,616
             
UTi Worldwide Inc.            
Geographic Reporting            
(in thousands)            
(Unaudited)            
             
  Three months ended July 31, 2012            
  Freight Forwarding Revenue Contract Logistics and Distribution Revenue Freight Forwarding Net Revenue Contract Logistics and Distribution Net Revenue Operating Income/(Loss) Severance and Other
EMENA  $ 236,506 $ 60,048 $ 61,021 $ 33,524 $ 2,470 $ 1,199
Americas  195,208 205,008 48,648 90,263 9,809 499
Asia Pacific  224,247 18,533 49,197 12,008 13,353 50
Africa  114,272 101,966 27,863 83,547 22,159 44
Corporate   —  —  —  — (14,761) 332
Total  $ 770,233 $ 385,555 $ 186,729 $ 219,342 $ 33,030 $ 2,124
             
  Three months ended July 31, 2011            
  Freight Forwarding Revenue Contract Logistics and Distribution Revenue Freight Forwarding Net Revenue Contract Logistics and Distribution Net Revenue Operating Income/(Loss) Severance and Other
EMENA  $ 278,059 $ 58,595 $ 70,098 $ 38,810 $ 2,726 $ 2,189
Americas  203,413 217,147 50,778 101,979 11,950 299
Asia Pacific  290,524 16,544 57,517 10,062 18,900 248
Africa  129,756 103,320 28,697 85,455 19,020  —
Corporate   —  —  —  — (12,855) 747
Total  $ 901,752 $ 395,606 $ 207,090 $ 236,306 $ 39,741 $ 3,483
             
UTi Worldwide Inc.            
Geographic Reporting            
(in thousands)            
(Unaudited)            
             
  Six months ended July 31, 2012 
             
  Freight Forwarding Revenue Contract Logistics and Distribution Revenue Freight Forwarding Net Revenue Contract Logistics and Distribution Net Revenue Operating Income/(Loss) Severance and Other
             
EMENA  $ 480,851 $ 123,036 $ 119,185 $ 71,677 $ 1,930 $ 2,229
Americas  381,873 401,731 95,031 178,874 16,269 924
Asia Pacific  437,111 35,508 95,736 23,154 24,158 75
Africa  231,946 212,015 53,091 175,090 43,438 57
Corporate   —  —  —  — (29,225) 539
Total  $ 1,531,781 $ 772,290 $ 363,043 $ 448,795 $ 56,570 $ 3,824
             
  Six months ended July 31, 2011 
             
  Freight Forwarding Revenue Contract Logistics and Distribution Revenue Freight Forwarding Net Revenue Contract Logistics and Distribution Net Revenue Operating (Loss)/Income Severance and Other
             
EMENA  $ 551,890 $ 115,066 $ 135,068 $ 76,835 $ (845) $ 5,987
Americas  379,470 419,872 96,387 201,352 15,676 1,350
Asia Pacific  548,112 29,590 105,688 18,912 32,704 248
Africa  252,033 200,030 54,450 165,281 37,402  —
Corporate   —  —  —  — (26,403) 747
Total  $ 1,731,505 $ 764,558 $ 391,593 $ 462,380 $ 58,534 $ 8,332
     
UTi Worldwide Inc.     
Supplemental Financial Information – Reconciliation to US GAAP  
(in thousands, except per share amounts)    
(Unaudited)    
     
  Three months ended  July 31, 2012  Three months ended July 31, 2011 
     
GAAP Revenues $ 1,155,788 $ 1,297,358
Less: Purchased transportation costs (749,717) (853,962)
Net Revenues $ 406,071 $ 443,396
     
GAAP Operating expenses $ 1,122,758 $ 1,257,617
Less: Purchased transportation costs (749,717) (853,962)
Operating expenses less purchased transportation costs  373,041 403,655
Severance and other (1)(2) (2,124) (3,483)
Non-GAAP Operating expenses $ 370,917 $ 400,172
     
GAAP Operating income $ 33,030 $ 39,741
Severance and other (1)(2) 2,124 3,483
Non-GAAP Operating income $ 35,154 $ 43,224
     
Percent of Net Revenues 8.7% 9.7%
     
GAAP Pretax income $ 30,264 $ 36,097
Severance and other (1)(2) 2,124 3,483
Non-GAAP Pretax income $ 32,388 $ 39,580
     
GAAP Provision for income taxes $ 10,047 $ 11,259
Severance and other (1)(2) 705 1,086
Non-GAAP Provision for income taxes $ 10,752 $ 12,345
     
GAAP Net income attributable UTi Worldwide Inc. $ 18,883 $ 22,873
Adjustment for:    
Severance and other (1)(2) 2,124 3,483
Income tax severance and other (3) (705) (1,086)
Non-GAAP Net income attributable UTi Worldwide Inc. $ 20,302 $ 25,270
     
GAAP Diluted earnings per common share $ 0.18 $ 0.22
Adjustment for:    
Severance and other (1)(2) 0.03 0.03
Income tax severance and other (3) (0.01) (0.01)
Non-GAAP Diluted earnings per common share $ 0.20 $ 0.24
     
(1)  During the three months ended July 31, 2012, the company recorded pre-tax severance of $2,124 primarily related to transformation activities.
     
(2)  During the three months ended July 31, 2011, the company recorded pre-tax severance of $3,483 primarily related to transformation activities.
     
(3)  The provisions for income tax adjustment related to the severance costs were calculated based on the prevailing tax rate in each jurisdiction. 
     
UTi Worldwide Inc.     
Supplemental Financial Information – Reconciliation to US GAAP    
(in thousands, except per share amounts)    
(Unaudited)    
   Six months ended July 31, 2012   Six months ended July 31, 2011 
     
GAAP Revenues $ 2,304,071 $ 2,496,063
Less: Purchased transportation costs (1,492,233) (1,642,090)
Net Revenues $ 811,838 $ 853,973
     
GAAP Operating expenses $ 2,247,501 $ 2,437,529
Less: Purchased transportation costs (1,492,233) (1,642,090)
Operating expenses less purchased transportation costs  755,268 795,439
Severance and other (4)(5) (3,824) (8,332)
Non-GAAP Operating expenses $ 751,444 $ 787,107
     
GAAP Operating income $ 56,570 $ 58,534
Severance and other (4)(5) 3,824 8,332
Non-GAAP Operating income $ 60,394 $ 66,866
     
Percent of Net Revenues 7.4% 7.8%
     
GAAP Pretax income $ 50,968 $ 50,842
Severance and other (4)(5) 3,824 8,332
Non-GAAP Pretax income $ 54,792 $ 59,174
     
GAAP Provision for income taxes $ 16,521 $ 15,494
Severance and other (4)(5) 1,240 2,539
Non-GAAP Provision for income taxes $ 17,761 $ 18,033
     
GAAP Net income attributable UTi Worldwide Inc. $ 31,769 $ 31,616
Adjustment for:    
Severance and other (4)(5) 3,824 8,332
Income tax severance and other (6) (1,240) (2,539)
Non-GAAP Net income attributable UTi Worldwide Inc. $ 34,353 $ 37,409
     
GAAP Diluted earnings per common share $ 0.31 $ 0.31
Adjustment for:    
Severance and other (4)(5) 0.03 0.07
Income tax severance and other (6) (0.01) (0.02)
Non-GAAP Diluted earnings per common share $ 0.33 $ 0.36
     
(4)  During the six months ended July 31, 2012, the company recorded pre-tax severance of $3,824 primarily related to transformation activities.    
     
(5)  During the six months ended July 31, 2011, the company recorded pre-tax severance and other charges totaling $8,332, which were comprised of $6,418 in severance costs related to transformation activities and $1,914 in severance and facility exit costs associated with the closure of certain underutilized contract logistics facilities in Europe.     
     
(6)  The provisions for income tax adjustment related to the severance costs were calculated based on the prevailing tax rate in each jurisdiction.     
           
UTi Worldwide Inc.          
Organic Growth Reconciliation        
(Unaudited)          
           
Set forth below is a reconciliation of the company's organic growth rates and the growth rates based on the company's GAAP reported results in the company's revenues, net revenues and operating expenses less purchased transportation costs for the three months ended July 31, 2012. Organic growth is a non-GAAP measure that excludes the impact of foreign currency translation.
         
Three months ended July 31, 2012:        
           
  Total Net Change +/(-) Currency Impact Organic Growth +/(-) Non-GAAP Items (7)(8) Adjusted Organic Growth
           
           
Revenues  (11)% 8% (3)% —% (3)%
Net revenues  (8)% 9% 1% —% 1%
Operating expenses less purchased transportation costs  (8)% 9% 1% 1% 2%
           
           
(7)  During the three months ended July 31, 2012, the company recorded pre-tax severance of $2,124 primarily related to transformation activities. 
           
(8)  During the three months ended July 31, 2011, the company recorded pre-tax severance of $3,483 primarily related to transformation activities. 
           
UTi Worldwide Inc.          
Organic Growth Reconciliation          
(Unaudited)          
           
Set forth below is a reconciliation of the company's organic growth rates and the growth rates based on the company's GAAP reported results in the company's revenues, net revenues and operating expenses less purchased transportation costs for the six months ended July 31, 2012. Organic growth is a non-GAAP measure that excludes the impact of foreign currency translation.
           
Six months ended July 31, 2012:          
           
  Total Net Change +/(-) Currency Impact Organic Growth +/(-) Non-GAAP Items (9)(10) Adjusted Organic Growth
           
Revenues  (8)% 6% (2)% —% (2)%
Net revenues  (5)% 7% 2% —% 2%
Operating expenses less purchased transportation costs  (5)% 7% 2%  —% 2%
           
(9)  During the six months ended July 31, 2012, the company recorded pre-tax severance of $3,824 primarily related to transformation activities. 
           
(10)  During the six months ended July 31, 2011, the company recorded pre-tax severance and other charges totaling $8,332, which were comprised of $6,418 in severance costs related to transformation activities and $1,914 in severance and facility exit costs associated with the closure of certain underutilized contract logistics facilities in Europe. 
CONTACT:  Jeff Misakian          Global Vice President, Investor Relations          (562) 552-9417          jmisakian@go2uti.com

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