How EXPD’s Custom Brokerage Segment Performed in 2Q17
EXPD’s Customs Brokerage segment
Previously in this series, we looked at Expeditors International of Washington’s (EXPD) 2Q17 Ocean Freight and Ocean Services revenues. In this article, we’ll check the performance of its Customs Brokerage (CHRW) segment. In 2Q17, these segmental revenues rose 10.1% to $471.8 million from $428.4 million in 2Q16.
In 2Q17, EXPD’s Customs Brokerage division posted the highest rise in net revenues. The vertical’s net revenues rose 6% in the three months ended June 30, 2017.
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EXPD’s Customs Brokerage details
Increased freight volumes in customs brokerage and road freight (JBHT) services led to the rise in the segment’s total revenues in 2Q17. The vertical’s net revenues rose 6% in 2Q17 on a year-over-year basis. Higher North American customs brokerage and road freight volumes drove the net revenue rise.
Net revenues in the North America region rose 10% in 2Q17, primarily due to increased volumes in customs brokerage (XPO) and road freight services. Europe’s net revenues grew 5% due to higher customs brokerage (HUBG) and road freight services.
Expeditors International of Washington’s (EXPD) management believes the momentum in its Customs Brokerage segment could continue in the second half of 2017. The company expects to bank on its sophisticated computerized capabilities that are essential to a complete logistics management program.
According to EXPD, larger customers need access to sophisticated and efficient procedures for their logistics management processes. The Seattle-headquartered company foresees customers utilizing the services of fewer operators that offer a global footprint and state-of-the-art technology.
As a third-party logistics provider, Expeditors International of Washington (EXPD) is covered by 100 ETFs. The iShares Transportation Average ETF (IYT) has the highest exposure (4.3%) to the stock among all these ETFs. IYT has 10.8% exposure to US trucking companies overall.
Keep reading to learn about EXPD’s operating margins in 2Q17.