Shares of UTi Worldwide (NASDAQ:UTIW), a provider of supply chain services, surged more than 5% Thursday after the company said it beat second-quarter estimates, as earnings edged higher on stronger airfreight and ocean freight volumes.
The company posted net income of $18.9 million, or 19 cents a share, compared with $11.8 million, or 12 cents a share, in the same quarter last year.
The results were ahead of average analyst estimates polled by Thomson Reuters of 17 cents a share.
Revenue for the Long Beach, California-based company was $1.15 billion, up 37% from $840.5 million in the earlier-year period, and trumping the Street’s view of $1.08 billion.
UTi CEO Eric W. Kirchner said the improved earnings were attributable to stronger volumes and better operating margins.
“Airfreight and ocean freight volumes continued to grow faster than the market and were higher than volumes recorded in the second quarter two years ago, prior to the financial crisis,” he said.
Results are tempered by yield pressure due to high transportation rates, according to the CEO, and the company said it expects rates to remain volatile through the rest of the year.
U Ti also expects volume growth to moderate during the second half of the year given the slowing economy, though Kirchner said it remains encouraged in its contract logistics and distribution business.
“Client volumes improved in the quarter, particularly in retail and consumer markets, and we continue to manage our operations more efficiently,” he said. “Our transformation initiatives remain on schedule and we are making good progress in all areas.”