The third quarter of fiscal 2012, which ended October 31, was rather profitable for UTi Worldwide Inc., despite weakening airfreight volumes. Revenues for the global freight forwarder surged 5.5 percent, year-over-year, and net income rose $2.1 million from the third quarter of fiscal 2011.
Operating income also improved considerably during this period, transitioning from $43.9 million in the third quarter of fiscal 2011 to $48.3 million in quarter three of fiscal year 2012.
UTi officials attribute these numbers to greater seafreight traffic and higher fuel surcharges. Increased contract logistics and distribution activity also played a part, according to a company press release.
Profitability in these areas helped offset sluggish airfreight traffic, especially in October. Unfortunately, these segments may need to continue carrying UTi in the fourth quarter of fiscal 2012, as a peak in airfreight is unexpected, company CEO Eric Kirchner maintained.
“Many clients are planning for a slower [airfreight] environment,” Kirchner said in a statement. And UTi officials are focusing on areas they can directly control, he explained. “The deployment of our new freight forwarding system is proceeding as planned, while we continue to roll out improved global operating processes,” Kirchner revealed.
Unfortunately, some areas will always be uncontrollable, he acknowledged. Chief among them is the global economy. Because of this, Kirchner is cautiously optimistic about UTi’s fourth-quarter numbers.
“While our third-quarter performance was steady, we currently anticipate that our fourth quarter is likely to be adversely impacted by the strengthening of the U.S. dollar, particularly against the South African rand, slowing in the global economy, and the timing of Chinese New Year,” he stated.