UTi Worldwide posts slight rise in 1Q earnings

LONG BEACH, Calif.

Freight logistics company UTi Worldwide Inc. said Thursday its fiscal 2011 first-quarter earnings rose a better-than-expected 2 percent as higher costs were offset by stronger airfreight and ocean shipping volumes.

The company said that first-quarter shipments for air and ocean were "very close" to pre-recession levels in the same quarter two years ago. However, UTi said its freight forwarding results were constrained by yield pressure caused by very tight capacity and higher transportation rates.

"We are adjusting our pricing to reflect these higher rates, yet rates continue to be volatile on many trade lanes," said CEO Eric W. Kirchner, in a statement. He said it is difficult to predict when yields might stabilize, as it will depend on the future rate and capacity environment and the company's continued ability to adjust pricing. Reaching its targeted margins may cut into volume growth in the months ahead, he added.

For the quarter ended April 30, the company earned $10.1 million, or 10 cents per share, compared with $9.8 million, or 10 cents per share, a year ago.

Operating expenses rose 19 percent in the quarter, but revenue jumped 37 percent to $1.06 billion.

Analysts polled by Thomson Reuters had expected a profit of 9 cents per share on revenue of $921.8 million, on average.

Shares rose 19 cents to close at $14.42.