April 23, 2013
Ryder System, Inc. reported earnings of $40.8 million Tuesday, compared with $34.9 million in the year-earlier period.
Total revenue for the first quarter of 2013 was $1.56 billion, up 2 percent from $1.54 billion in the same period last year. Operating revenue (revenue excluding FMS fuel and all subcontracted transportation), was $1.27 billion, up 3 percent compared with $1.23 billion in the year-earlier period, reflecting organic full service lease growth as well as increased volumes and new business in Supply Chain Solutions (SCS).
“Our largest product line, full service lease, led our performance for the quarter, reflecting the benefits of both improved residual values as well as the strong vehicle replacement cycle underway with customers,” Ryder President and CEO Robert Sanchez says. “Our largest product line, full service lease, led our performance for the quarter, reflecting the benefits of both improved residual values as well as the strong vehicle replacement cycle underway with customers. Maintenance costs improved due to a younger lease fleet; however, maintenance costs did not decline as much as anticipated due to upfront costs on initiatives and other items.”
Lower maintenance costs on a younger lease fleet were partially offset by increased costs to prepare vehicles for sale and up-front investments in initiatives for which benefits have not yet been realized.
Fleet Management Solutions (FMS) total revenue increased 3 percent due primarily to higher operating revenue. FMS operating revenue increased 4 percent due to higher full service lease revenue. SCS total revenue increased 1 percent, driven by higher operating revenue, partially offset by lower subcontracted transportation revenue. SCS operating revenue increased 2 percent due to improved freight volumes and new business in the automotive sector and dedicated services, partially offset by lower volumes in the high-tech sector.
“Used vehicles sales results were in line with expectations, with continued strong pricing,” Sanchez adds. “SCS revenue and earnings improved and were also in line with expectations.”