Ryder System Inc (R) Q3 2023 Earnings: Strong Returns Amid Weak Freight Environment
Ryder System Inc (NYSE:R) reported Q3 2023 GAAP EPS from continuing operations of $3.44, down from $4.82 in the prior year.
Total revenue stood at $2.9 billion, a slight decrease from $3.0 billion in the prior year.
The company increased its full-year 2023 comparable EPS forecast to $12.60 - $12.85, up from the prior forecast of $12.20 - $12.70.
Ryder System Inc (NYSE:R) also increased its adjusted ROE forecast to 18% - 19%, up from 17% - 19%.
On October 25, 2023, Ryder System Inc (NYSE:R), a leader in supply chain, dedicated transportation, and fleet management solutions, released its earnings report for the third quarter of 2023. Despite weaker market conditions in used vehicle sales and rental, the company managed to deliver strong returns and raised its full-year guidance.
Financial Highlights
The company reported GAAP EPS from continuing operations of $3.44, compared to $4.82 in the prior year. The comparable EPS (non-GAAP) from continuing operations stood at $3.58, down from a record $4.45 in the prior year. This reflects weaker market conditions in used vehicle sales and rental, partially offset by strong Supply Chain Solutions (SCS) results.
Total revenue for the quarter was $2.9 billion, slightly down from $3.0 billion in the prior year. However, operating revenue (non-GAAP) was up 1% at $2.4 billion, reflecting contractual revenue growth across all segments, partially offset by lower commercial rental revenue in Fleet Management Solutions (FMS).
CEO Commentary
Our strong third quarter performance and increased 2023 guidance demonstrate the ongoing effectiveness of our balanced growth strategy despite a challenging freight environment, says Ryder Chairman and CEO Robert Sanchez. "The transformative changes weve made to de-risk the business model, enhance returns, and drive profitable growth are contributing to our significant outperformance versus prior cycles and are providing us with additional opportunities to increase shareholder value."
Segment Review
The Fleet Management Solutions (FMS) segment saw a decrease in total revenue by 6% and operating revenue by 3%. The Supply Chain Solutions (SCS) segment reported a 1% decrease in total revenue but a 9% increase in operating revenue. The Dedicated Transportation Solutions (DTS) segment reported a 1% decrease in total revenue and a 3% increase in operating revenue.
Outlook
Ryder System Inc (NYSE:R) increased its full-year 2023 comparable EPS (non-GAAP) forecast to $12.60 - $12.85, up from the prior forecast of $12.20 - $12.70. The company also increased its adjusted ROE forecast to 18% - 19%, up from 17% - 19%.
Despite weakening freight conditions and used vehicle pricing that peaked over a year ago, the company remains confident in its ability to deliver strong results in a difficult environment.
This article first appeared on GuruFocus.
