Ryder Reports First Quarter 2023 Results

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Ryder System, Inc., a leader in supply chain, dedicated transportation, and fleet management solutions, reported results for the three months ended March 31 as follows:

First-Quarter 2023 Highlights

• GAAP EPS from continuing operations of $2.95 compared to $3.35 in prior year
• Comparable EPS (non-GAAP) from continuing operations of $2.81 down from $3.59 in prior year; strong but lower results in Fleet Management Solutions (FMS), as expected, and a Supply Chain Solutions (SCS) asset impairment partially offset by lower share count and better results in Dedicated Transportation Solutions (DTS)
• Total revenue of $3.0 billion and operating revenue (non-GAAP) of $2.3 billion, up 3% and 6%, respectively, primarily reflecting SCS revenue growth

Full-Year 2023 Forecast

• Increased low end of comparable EPS (non-GAAP) forecast to $11.30 - $12.05 from prior forecast of $11.05 - $12.05
• Adjusted ROE (ROE) forecast remains at 16% - 18%
• Operating revenue (non-GAAP) growth forecast remains at approximately 4%
• Net cash provided by operating activities from continuing operations forecast remains at $2.4 billion; free cash flow (non-GAAP) forecast remains at approximately $200 million

CEO Comment

"Consistent with our expectations, we delivered strong first-quarter results in a challenging freight environment," says Ryder Chairman and CEO Robert Sanchez. "Results benefited from outperformance in used vehicle sales and dedicated, which were offset by an SCS asset impairment charge related to a customer bankruptcy. Based on modestly higher-than-expected used vehicle sales trends, we are raising the low end of our full-year comparable EPS forecast.

"Strong results also reflect the transformative actions we’re taking to increase returns and position the business to outperform prior cycles. Pricing actions benefited all segments, while revenue growth benefited earnings in dedicated and supply chain. As anticipated, earnings decreased from prior-year record levels as market conditions in used vehicle sales and rental continued to normalize.

"Continued revenue growth in SCS and DTS reflects favorable outsourcing trends and our initiatives to drive accelerated growth in these higher-return businesses. In FMS, revenue growth in North America, driven by SelectCare and ChoiceLease, was more than offset by the revenue impact from the UK exit.

"Longer-term secular trends including escalating demand for supply chain resiliency, nearshoring activity, and e-commerce fulfillment provide significant opportunities for future growth. Our strong balance sheet and solid investment-grade credit rating provide us with ample capacity to support organic growth, pursue strategic investments and acquisitions, and return capital to shareholders.

"I'm confident we're on the right path as continued execution of our balanced growth strategy positions us well for long-term profitable growth and increased shareholder value despite softer freight conditions."