Circle International Group, Inc. Reports First Quarter Results; Company Achieves Double-Digit Revenue and Net Revenue Growth.Business Editors SAN FRANCISCO--(BUSINESS WIRE)--May 10, 2000 Circle International Group, Inc. (Nasdaq:CRCL CRCL Creatinine Clearance CRCL Circle CRCL Coalition to Restore Coastal Louisiana CRCL Center for Research in Computational Linguistics CRCL Columbia River Conservation League ) today reported net income for the first quarter ended March 31, 2000 of $3.2 million, or $0.18 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared to 1999 first quarter earnings of $1.9 million, or $0.11 per diluted share. Income from operations for the first quarter of 2000 increased 102 percent to $4.6 million from $2.3 million last year. Results benefited from the absence of Y2K See Y2K problem and Y2K compliant. Y2K - Year 2000 expenses, which offset soft January January: see month. 2000 activity levels. Revenues for the first quarter of 2000 increased 18 percent to $216.2 million from $182.9 million for the same period last year. Net revenues, which represent revenues less purchased transportation costs, rose 11 percent in the first quarter this year to $84.6 million from $76.2 million in the first quarter of 1999. David I David I, king of Scotland David I, 1084–1153, king of Scotland (1124–53), youngest son of Malcolm III and St. Margaret of Scotland. During the reign of his brother Alexander I, whom he succeeded, David was earl of Cumbria, ruling S of the Clyde . Beatson, Circle's chairman, president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , said he was encouraged with the company's performance, citing Circle's strategic improvement initiatives launched last year. "Our expanded customer base and focus on full-service full-ser·vice adj. Associated with or offering complete service: full-service gasoline pumps; full-service banks. solutions has fueled strong organic growth," he noted. "We increased year-over-year revenues in every geographic region despite a soft January, where we experienced reduced shipping volumes due to customer Y2K inventory buildup build·up also build-up n. 1. The act or process of amassing or increasing: a military buildup; a buildup of tension during the strike. 2. late in 1999." All of Circle's principal product lines reported higher first quarter revenues compared to the previous year. "Our customers continue to respond positively to our initiatives," Beatson said. "Several major new customers secured late in 1999 have been fully implemented and are now contributing to our revenue stream. Circle's strengthened market presence is creating more opportunities to bid and win profitable new business." Global economic issues, particularly in Asia, present some challenges as capacity constraints CONSTRAINTS - A language for solving constraints using value inference. ["CONSTRAINTS: A Language for Expressing Almost-Hierarchical Descriptions", G.J. Sussman et al, Artif Intell 14(1):1-39 (Aug 1980)]. and rate increases continue to put pressure on yields. Circle instituted a fuel surcharge An overcharge or additional cost. A surcharge is an added liability imposed on something that is already due, such as a tax on tax. It also refers to the penalty a court can impose on a fiduciary for breaching a duty. during the quarter, which has recouped some of the higher fuel costs passed on from airline and ocean partners. On a geographic basis, Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). posted a 12 percent net revenue
increase. The Asia Pacific region's net revenues were up 10
percent.North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. net revenues were up 11 percent, the result of better yields on export traffic, and growth in imports, logistics/warehousing and customs brokerage business. Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. net revenues increased substantially but still represented less than 4 percent of total business. Other income, net was lower in the first quarter of 2000 compared to the same period last year. This was due, in part, to Circle's Taiwan Taiwan (tī`wän`), Portuguese Formosa, officially Republic of China, island nation (2005 est. pop. 22,894,000), 13,885 sq mi (35,961 sq km), in the Pacific Ocean, separated from the mainland of S China by the 100-mi-wide (161-km) Taiwan business unit being fully consolidated rather than being reported as an affiliate. Other income, net was also impacted by higher interest expense to support capital expenditures, offset by higher foreign exchange gains. Income from Circle's automotive logistics affiliate, TDS TDS total dissolved solids. , increased $0.2 million reflecting continued improvement from last year. "We are pleased with our consistent growth," said Beatson. "While a slower economy could impact progress, we remain optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op as we focus on building Circle through organic growth and providing strategic value and quality for our customers." About Circle: San Francisco-based Circle International Group, Inc. (Nasdaq:CRCL) is a global transportation, supply chain management and information services See Information Systems. company. Founded in 1898, Circle today has more than 4,900 employees, with over 300 offices in 100 countries. With annual revenues of over $800 million, Circle's services include air and ocean freight forwarding, customs brokerage, materials management Materials management is the branch of logistics that deals with the tangible components of a supply chain. Specifically, this covers the acquisition of spare parts and replacements, quality control of purchasing and ordering such parts, and the standards involved in ordering, , warehousing, trade facilitation See also Trade Facilitation and Development. Trade facilitation looks at how procedures and controls governing the movement of goods across national borders can be improved to reduce associated cost burdens and maximise efficiency while safeguarding legitimate and procurement The fancy word for "purchasing." The procurement department within an organization manages all the major purchases. , and integrated logistics and supply chain management services. More information about Circle is available at www.circleintl.com. Except for historical information contained herein, the matters set forth in this release are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that are dependent on certain risks and uncertainties, including, but not limited to, such factors as dependence on international trade and worldwide economic conditions, severe economic conditions in certain regions serviced by the Company, market demand, pricing risks associated with operations outside the U.S., currency fluctuations, competitive pressures, imbalances of capacity and demand in certain trade lanes and service areas, the Company's ability to integrate successfully businesses that it acquires, the increasing complexity of the Company's information technology, the effect of the Company's accounting policies, and other risk factors detailed in the Company's SEC filings.
CIRCLE INTERNATIONAL GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED OPERATING DATA
(unaudited, in thousands, except per share amounts)
Three Months Ended
March 31,
2000 1999
Revenue $ 216,161 $ 182,853
Freight consolidation costs 131,517 106,687
--------- ---------
Net revenue 84,644 76,166
Other costs and expenses:
Salaries and related 47,864 42,257
Operating, selling and administrative 32,152 31,621
--------- ---------
Total other costs and expenses 80,016 73,878
--------- ---------
Income from operations 4,628 2,288
Other income (expense):
Interest income (expense), net (262) 75
Income from affiliates, net 386 504
Other, net 230 86
--------- ---------
Total other income, net 354 665
--------- ---------
Income before taxes 4,982 2,953
Taxes on income 1,804 1,078
--------- ---------
Net income $ 3,178 $ 1,875
========= =========
Net income per
share -- diluted $ 0.18 $ 0.11
========= =========
Weighted average common
shares outstanding -- diluted 17,708 17,164
========= =========
CIRCLE INTERNATIONAL GROUP, INC. AND SUBSIDIARIES
PRODUCT AND GEOGRAPHIC SEGMENT INFORMATION
(unaudited, in thousands)
Three Months Ended
March 31,
2000 1999
Revenue
Air freight forwarding $137,774 64% $119,216 65%
Ocean freight forwarding 37,456 17% 27,396 15%
Customs brokerage and other 40,931 19% 36,241 20%
------------------ ------------------
Total $216,161 100% $182,853 100%
================== ==================
Net Revenue
Air freight forwarding $ 32,080 38% $ 29,634 39%
Ocean freight forwarding 11,633 14% 10,291 13%
Customs brokerage and other 40,931 48% 36,241 48%
------------------ ------------------
Total $ 84,644 100% $ 76,166 100%
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Three Months Ended
March 31,
2000 1999
Revenue
Americas $ 89,876 41% $ 89,045 49%
Europe & Middle East 46,818 22% 39,530 21%
Asia & South Pacific 79,467 37% 54,278 30%
------------------ ------------------
Total $216,161 100% $182,853 100%
================== ==================
Net Revenue
Americas $ 43,595 52% $ 39,092 51%
Europe & Middle East 22,299 26% 19,957 26%
Asia & South Pacific 18,750 22% 17,117 23%
------------------ ------------------
Total $ 84,644 100% $ 76,166 100%
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