CHICAGO, Oct. 26, 2021 /PRNewswire/ -- Echo Global
Logistics, Inc. (NASDAQ: ECHO), a leading provider of
technology-enabled transportation management services, today
reported financial results for the quarter ended September 30,
2021.
Recent Merger Announcement
On September 9, 2021, Echo
announced it has entered into a definitive merger agreement to be
acquired by funds managed by The Jordan Company, a global private
equity firm, for $48.25 per share for
an equity value of approximately $1.3
billion. As such, the Company will not be updating its
outlook for fiscal 2021 or longer-term targets and will not be
holding a conference call to discuss the Company's financial
results for the third quarter ended September 30, 2021. Completion of the transaction
is subject to approval by the Company's stockholders, regulatory
approvals and other customary closing conditions. The parties
expect to close the transaction during the fourth quarter of
2021.
Third Quarter 2021 Highlights
- Revenue increased 42.5% to $985.6
million from the third quarter of 2020
- Gross profit increased 41.6% to $135.2
million from the third quarter of 2020
- Adjusted gross profit(1) increased 38.7% to
$139.3 million from the third quarter
of 2020
- Truckload ("TL") revenue increased 51.2% to $738.0 million from the third quarter of 2020,
and TL volume increased 15.0% from the third quarter of 2020
- Less than truckload ("LTL") revenue increased 25.3% to
$219.8 million from the third quarter
of 2020, and LTL volume increased 3.1% from the third quarter of
2020
- Transactional revenue increased 42.5% to $761.0 million and Managed Transportation revenue
increased 42.5% to $224.6 million
from the third quarter of 2020
- Net income increased to $18.9
million, compared to $6.8
million in the third quarter of 2020
- Fully diluted earnings per share ("EPS") increased to
$0.70 in the third quarter of 2021;
non-GAAP fully diluted EPS(1) increased to $0.93 in the third quarter of 2021
- Adjusted EBITDA(1) grew 83.2% to $40.2 million, compared to $21.9 million in the third quarter of 2020
|
|
(1) Represents a non-GAAP financial measure. For the
definition and a discussion of each non-GAAP financial measure
contained in this release, see "Non-GAAP Financial Measures." For a
reconciliation of each non-GAAP financial measure to the nearest
comparable GAAP financial measure, see the "Reconciliation of
Non-GAAP Financial Measures" section of this
release.
|
Non-GAAP Financial Measures
This release includes the following financial measures defined
as "Non-GAAP financial measures" by the Securities and
Exchange Commission (the "SEC"): Adjusted gross profit,
adjusted gross profit margin, EBITDA, Adjusted EBITDA and Non-GAAP
fully diluted EPS. Adjusted gross profit is calculated as gross
profit adjusted to exclude internal use software depreciation. It
also represents revenue minus transportation costs. Adjusted gross
profit margin is calculated as adjusted gross profit (as previously
defined) divided by revenue. EBITDA is defined as net income
excluding the effects of depreciation, amortization, cash and
non-cash interest expense and income taxes. Adjusted EBITDA is
defined as EBITDA (as previously defined) excluding the changes in
contingent consideration, merger-related transaction costs, and
stock compensation expense. Non-GAAP fully diluted EPS is defined
as fully diluted EPS excluding changes in contingent consideration,
amortization, non-cash interest expense, merger-related transaction
costs, stock compensation expense and the tax effect of these
adjustments. We believe such measures provide useful information to
investors because they provide information about the financial
performance of the Company's ongoing business.
Adjusted gross profit, adjusted gross profit margin, EBITDA,
Adjusted EBITDA and Non-GAAP fully diluted EPS are used by
management in its financial and operational decision-making and
evaluation of overall operating performance. These measures may be
different from similar measures used by other companies. The
presentation of this financial information, which is not prepared
under any comprehensive set of accounting rules or principles, is
not intended to be considered in isolation or as a substitute for
the financial information prepared and presented in accordance with
generally accepted accounting principles. For a reconciliation of
each non-GAAP financial measure to the nearest comparable GAAP
financial measure, see "Reconciliation of Non-GAAP Financial
Measures" included in this release.
Forward-Looking Statements
All statements made in this release, other than statements of
historical fact, are or may be deemed to be forward-looking
statements. These statements are forward-looking statements under
the federal securities laws. We can give no assurance that any
future results discussed in these statements will be achieved.
These statements are based on current plans and expectations of
Echo Global Logistics and involve risks, uncertainties and other
factors that may cause our actual results, performance or
achievements to be different from any future results, performance
or achievements expressed or implied by these statements.
Information concerning these risks, uncertainties and other factors
is contained under the headings "Risk Factors" and "Forward-Looking
Statements" and elsewhere in our Annual Report on Form 10-K for the
year ended December 31, 2020, and
other filings with the SEC.
About Echo Global Logistics
Echo Global Logistics, Inc. (NASDAQ: ECHO) is a leading
Fortune 1000 provider of technology-enabled transportation and
supply chain management services. Headquartered in Chicago with more than 30 offices around the
country, Echo offers freight brokerage and Managed Transportation
solutions for all major modes, including truckload, partial
truckload, LTL, intermodal and expedited. Echo maintains a
proprietary, web-based technology platform that compiles and
analyzes data from its network of over 50,000 transportation
providers to serve 35,000 clients across a wide range of industries
and simplify the critical tasks involved in transportation
management. For more information on Echo Global Logistics,
visit: www.echo.com.
ECHO: Earnings
INVESTOR RELATIONS CONTACTS:
Pete Rogers
Chief Financial Officer
Echo Global Logistics
312-676-4584
Zach Jecklin
SVP of Strategy
Echo Global Logistics
312-784-2046
MEDIA CONTACT:
Christopher Clemmensen
SVP of Marketing
Echo Global Logistics
312-784-2132
Summarized financial results and select operating metrics are as
follows:
|
|
Three Months Ended
September 30,
|
|
|
|
Dollars in
millions, except per share data
|
|
2021
|
|
2020
|
|
%
change
|
|
|
(unaudited)
|
|
|
|
Transactional
revenue
|
|
$
|
761.0
|
|
|
$
|
533.9
|
|
|
42.5
|
%
|
|
Managed
Transportation revenue
|
|
224.6
|
|
|
157.6
|
|
|
42.5
|
%
|
|
Revenue
|
|
985.6
|
|
|
691.5
|
|
|
42.5
|
%
|
|
|
|
|
|
|
|
|
Transportation
costs
(excludes internal
use software depreciation)(1)
|
|
846.3
|
|
|
591.0
|
|
|
43.2
|
%
|
|
|
|
|
|
|
|
|
Commission
expense
|
|
40.5
|
|
|
29.8
|
|
|
36.0
|
%
|
|
Change in contingent
consideration
|
|
—
|
|
|
(0.3)
|
|
|
100.0
|
%
|
|
Merger-related
transaction costs
|
|
2.5
|
|
|
—
|
|
|
100.0
|
%
|
|
Stock compensation
expense
|
|
2.6
|
|
|
2.3
|
|
|
11.3
|
%
|
|
Other selling,
general and administrative
|
|
58.6
|
|
|
48.7
|
|
|
20.2
|
%
|
|
Selling, general
and administrative expenses
|
|
104.2
|
|
|
80.5
|
|
|
29.4
|
%
|
|
|
|
|
|
|
|
|
Depreciation
|
|
6.3
|
|
|
7.0
|
|
|
(9.2)
|
%
|
|
Amortization
|
|
2.6
|
|
|
2.7
|
|
|
(4.5)
|
%
|
|
Depreciation and
amortization
|
|
8.9
|
|
|
9.7
|
|
|
(7.9)
|
%
|
|
|
|
|
|
|
|
|
Income from
operations
|
|
26.2
|
|
|
10.3
|
|
|
155.6
|
%
|
|
|
|
|
|
|
|
|
Cash interest
expense
|
|
0.6
|
|
|
1.0
|
|
|
(37.1)
|
%
|
|
Interest
expense
|
|
0.6
|
|
|
1.0
|
|
|
(37.1)
|
%
|
|
Income before
provision for income taxes
|
|
25.6
|
|
|
9.2
|
|
|
176.7
|
%
|
|
Income tax
expense
|
|
(6.7)
|
|
|
(2.4)
|
|
|
174.3
|
%
|
|
Net
income
|
|
$
|
18.9
|
|
|
$
|
6.8
|
|
|
177.6
|
%
|
|
|
|
|
|
|
|
|
Fully diluted
EPS
|
|
$
|
0.70
|
|
|
$
|
0.26
|
|
|
172.0
|
%
|
|
Diluted
shares
|
|
27.0
|
|
|
26.5
|
|
|
|
|
Note: Amounts may not
foot due to rounding.
|
|
|
|
|
|
|
|
(1) Transportation costs
excludes internal use software depreciation of $4.1 million and
$5.0 million for three months ended September 30,
2021 and 2020, respectively. Internal use software depreciation is
included in depreciation expense.
|
|
|
|
|
|
Reconciliation of
Non-GAAP Financial Measures
|
|
Three Months Ended
September 30,
|
|
|
|
|
Dollars in
millions, except per share data
|
|
2021
|
|
2020
|
|
%
change
|
|
|
|
(unaudited)
|
|
|
|
|
Revenue
|
|
$
|
985.6
|
|
|
$
|
691.5
|
|
|
42.5
|
%
|
|
|
Transportation
costs
|
|
846.3
|
|
|
591.0
|
|
|
43.2
|
%
|
|
|
Internal use software
depreciation
|
|
4.1
|
|
|
5.0
|
|
|
(17.2)
|
%
|
|
|
Gross
profit
|
|
$
|
135.2
|
|
|
$
|
95.5
|
|
|
41.6
|
%
|
|
|
Add: Internal use software
depreciation
|
|
4.1
|
|
|
5.0
|
|
|
(17.2)
|
%
|
|
|
Adjusted gross
profit(1)
|
|
$
|
139.3
|
|
|
$
|
100.4
|
|
|
38.7
|
%
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
18.9
|
|
|
$
|
6.8
|
|
|
177.6
|
%
|
|
|
Depreciation
|
|
6.3
|
|
|
7.0
|
|
|
(9.2)
|
%
|
|
|
Amortization
|
|
2.6
|
|
|
2.7
|
|
|
(4.5)
|
%
|
|
|
Cash interest
expense
|
|
0.6
|
|
|
1.0
|
|
|
(37.1)
|
%
|
|
|
Income tax
expense
|
|
6.7
|
|
|
2.4
|
|
|
174.3
|
%
|
|
|
EBITDA(1)
|
|
$
|
35.1
|
|
|
$
|
19.9
|
|
|
76.3
|
%
|
|
|
Merger-related
transaction costs
|
|
2.5
|
|
|
—
|
|
|
100.0
|
%
|
|
|
Change in contingent
consideration
|
|
—
|
|
|
(0.3)
|
|
|
100.0
|
%
|
|
|
Stock compensation
expense
|
|
2.6
|
|
|
2.3
|
|
|
11.3
|
%
|
|
|
Adjusted
EBITDA(1)
|
|
$
|
40.2
|
|
|
$
|
21.9
|
|
|
83.2
|
%
|
|
|
|
|
|
|
|
|
|
|
Fully diluted
EPS
|
|
$
|
0.70
|
|
|
$
|
0.26
|
|
|
172.0
|
%
|
|
|
Change in contingent
consideration
|
|
—
|
|
|
(0.01)
|
|
|
(100.0)
|
%
|
|
|
Amortization
|
|
0.10
|
|
|
0.10
|
|
|
(6.4)
|
%
|
|
|
Merger-related
transaction costs
|
|
0.09
|
|
|
—
|
|
|
100.0
|
%
|
|
|
Stock compensation
expense
|
|
0.09
|
|
|
0.09
|
|
|
9.1
|
%
|
|
|
Tax effect of
adjustments
|
|
(0.06)
|
|
|
(0.04)
|
|
|
46.2
|
%
|
|
|
Non-GAAP fully
diluted EPS(1)
|
|
$
|
0.93
|
|
|
$
|
0.40
|
|
|
133.7
|
%
|
|
|
|
|
|
|
|
|
|
|
Operating
Metrics
|
|
|
|
|
|
|
|
|
Gross profit
margin
|
|
13.7
|
%
|
|
13.8
|
%
|
|
(10)
|
|
bps
|
|
Adjusted gross profit
margin(1)
|
|
14.1
|
%
|
|
14.5
|
%
|
|
(39)
|
|
bps
|
|
Total
employees
|
|
2,655
|
|
|
2,513
|
|
|
5.7
|
%
|
|
|
Sales employees and
agents
|
|
1,719
|
|
|
1,617
|
|
|
6.3
|
%
|
|
|
TL revenue
%
|
|
74.9
|
%
|
|
70.6
|
%
|
|
430
|
|
bps
|
|
LTL revenue
%
|
|
22.3
|
%
|
|
25.4
|
%
|
|
(307)
|
|
bps
|
|
Note: Amounts may not
foot due to rounding.
|
|
|
|
|
|
|
|
|
(1) See the "Non-GAAP
Financial Measures" section of this release for the definition and
a discussion of each Non-GAAP financial measure.
|
|
Echo Global
Logistics, Inc.
|
|
Condensed
Consolidated Statements of Operations
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
In thousands,
except per share data
|
(unaudited)
|
|
(unaudited)
|
|
Revenue
|
$
|
985,590
|
|
|
$
|
691,495
|
|
|
$
|
2,720,916
|
|
|
$
|
1,757,262
|
|
|
|
|
|
|
|
|
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
|
Transportation
costs
(excludes internal use
software depreciation)(1)
|
846,306
|
|
|
591,048
|
|
|
2,325,553
|
|
|
1,478,864
|
|
|
Selling, general and
administrative expenses
|
104,170
|
|
|
80,533
|
|
|
303,765
|
|
|
235,667
|
|
|
Depreciation and
amortization
|
8,892
|
|
|
9,655
|
|
|
26,277
|
|
|
29,251
|
|
|
Income from
operations
|
26,223
|
|
|
10,259
|
|
|
65,321
|
|
|
13,480
|
|
|
Interest
expense
|
(638)
|
|
|
(1,014)
|
|
|
(2,070)
|
|
|
(5,200)
|
|
|
Income before
provision for income taxes
|
25,585
|
|
|
9,245
|
|
|
63,250
|
|
|
8,280
|
|
|
Income tax
expense
|
(6,659)
|
|
|
(2,427)
|
|
|
(15,761)
|
|
|
(3,444)
|
|
|
Net income
|
$
|
18,925
|
|
|
$
|
6,818
|
|
|
$
|
47,489
|
|
|
$
|
4,836
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
$
|
0.72
|
|
|
$
|
0.26
|
|
|
$
|
1.82
|
|
|
$
|
0.19
|
|
|
Diluted earnings per
share
|
$
|
0.70
|
|
|
$
|
0.26
|
|
|
$
|
1.77
|
|
|
$
|
0.18
|
|
|
Note: Amounts may not
foot due to rounding.
|
|
|
|
|
|
|
|
|
(1) Transportation costs
excludes internal use software depreciation of $4.1 million and
$5.0 million for three months ended September 30, 2021
and 2020, respectively; and $11.8 million and $14.7 million for
nine months ended September 30, 2021 and 2020, respectively.
Internal use
software depreciation is included in depreciation
expense.
|
|
Echo Global
Logistics, Inc.
|
|
Condensed
Consolidated Balance Sheets
|
|
|
September 30,
2021
|
|
December 31,
2020
|
|
In
thousands
|
(unaudited)
|
|
|
|
Cash and cash
equivalents
|
$
|
53,967
|
|
|
$
|
41,297
|
|
|
Accounts receivable,
net of allowance for doubtful accounts
|
576,205
|
|
|
439,391
|
|
|
Other current
assets
|
14,294
|
|
|
12,787
|
|
|
Total noncurrent
assets
|
464,946
|
|
|
470,469
|
|
|
Total
assets
|
$
|
1,109,413
|
|
|
$
|
963,944
|
|
|
|
|
|
|
Accounts
payable
|
$
|
423,732
|
|
|
$
|
317,692
|
|
|
Other current
liabilities
|
73,713
|
|
|
59,443
|
|
|
Long-term debt,
net
|
104,283
|
|
|
133,945
|
|
|
Other noncurrent
liabilities
|
53,968
|
|
|
53,494
|
|
|
Stockholders'
equity
|
453,717
|
|
|
399,369
|
|
|
Total liabilities and
stockholders' equity
|
$
|
1,109,413
|
|
|
$
|
963,944
|
|
|
Note: Amounts may not
foot due to rounding.
|
|
|
|
|
|
|
|
|
Echo Global
Logistics, Inc.
|
|
Condensed
Consolidated Statements of Cash Flows
|
|
|
Nine Months Ended
September 30,
|
|
2021
|
|
2020
|
|
In
thousands
|
(unaudited)
|
|
Net cash provided by
operating activities
|
$
|
67,860
|
|
|
$
|
53,367
|
|
|
Net cash used in
investing activities
|
(22,105)
|
|
|
(15,144)
|
|
|
Net cash used in
financing activities
|
(33,085)
|
|
|
(25,269)
|
|
|
Increase in cash and
cash equivalents
|
12,670
|
|
|
12,953
|
|
|
Cash and cash
equivalents, beginning of period
|
41,297
|
|
|
34,626
|
|
|
Cash and cash
equivalents, end of period
|
$
|
53,967
|
|
|
$
|
47,579
|
|
|
Note: Amounts may not
foot due to rounding.
|
|
|
|
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SOURCE Echo Global Logistics, Inc.