Like many of its US trucking giant rivals, Ryder Systems saw a notable spike in revenues and profits in Q4, 2024, offsetting what has been a difficult year for the industry as a whole. Q4 EBT was up 20.1% y-o-y to $239m on revenues up 5.5% y-o-y to $3,189m. Across its three principal businesses in the quarter:
– Supply Chain Solutions saw EBT up 57.9% y-o-y to $90m on revenues up 38.8% to $1,340m
– Dedicated saw revenues up 38.8% y-o-y to $34m on revenues up 9.7% to $615m
– Fleet Management Solutions also reported double-digit profit growth of 13.4% to $152m on revenues up 0.3% to $$1,485m
SCS benefitted from omnichannel retail in Q4
Ryder CEO Robert Sanchez said the Supply Chain Solutions (SCS) contract logistics segment was well prepared for the peak retail season, “SCS delivered record fourth quarter earnings which benefitted from higher volumes and optimisation efforts in our omnichannel retail vertical.”
Cardinal feeds Dedicated segment revenues
The February 2024 acquisition of Cardinal, a dedicated trucking carrier, was expected to be accretive on earnings by 2025, but seems to already have had an impact with that segment’s strong Q4 results. Sanchez added, “Dedicated also delivered record earnings reflecting strong performance in our legacy business and the Cardinal acquisition.”
End of the dip in the economy?
With a tight road freight market in the US, Sanchez is not the only trucking company chief executive to have said that he believes that the end of the road freight recession is in sight. In the earnings call he said, “As freight capacity tightens and driver availability becomes more challenging, we expect to see incremental sales opportunities and improved revenue growth in DTS as private fleets seek solutions to address this pain point.”
Where it comes to SCS, Sanchez continued, “Weaker volumes in our omnichannel retail vertical have been a headwind to revenue and earnings.We expect supply chain results to benefit as volumes for these services recover and our optimized warehouse footprint is leveraged. The high end of our 2025 comparable forecast range includes minimal expected freight cycle upturn benefits of approximately $15 million. We’ve been pleased by the business’s performance during the down cycle and are confident that each of our three business segments is appropriately positioned to benefit from the cycle upturn.”
Author: Richard Shrubb
Source: Ti Insight
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