World’s Largest 3PLs Off to a Weak Start in Fiscal Year 2015

The 3PL market has shown negative growth in the first quarter of 2015 mainly because of the declining reporting currency of the 3PLs.

Below is the list of y-o-y comparison of various currencies in which the 3PLs report their revenues

 

Reporting Currency Y-O-Y Decline %
Euro -17.6%
Danish Krone -17.4%
South Korean Won -2.6%
Kuwait Dollars -4.7%
Swizz Franc -6.1%

ARC Advisory Group (Logistics Viewpoints) tracks the quarterly revenue results of the most prominent publicly traded 3PLs on an ongoing basis. The report is published after all the companies on the list release their revenues. The off cycle earnings results by some large 3PLs is why we are reporting about 1Q 2015 revenues in June.

For this financial analysis, the scope of coverage includes non-asset based transportation and warehousing services (referred to as “contract logistics” in Europe):

  • Non-asset based domestic transportation services (brokerage and managed transportation services)
  • Non-asset based international transportation services (freight forwarding and customs services)
  • Warehousing services (warehousing and associated services such as packaging, light assembly, sequencing goods for a factory line)The table below lists the three segments their y-o-y growth and the contribution (in %) to overall market.

 

Business Segment Contribution to the total market Y-O-Y Decline
Domestic 14.1% -0.9%
International 54.7% -4.6%
Contract 31.2% -4.1%

 

The 1Q15 revenues across the public firms covered in this analysis has declined by 3.9 percent year over year with nine of sixteen 3PLs recording negative growth in revenues.  High flyers, based on year over year growth, include:

  • Expeditors International of Washington, up 12.5 percent
  • Norbert Dentressangle, up 5.5 percent
  • C.H. Robinson Worldwide, up 5 percent
  • JBHunt, up 4.7 percent
  • UPS Supply chain Solutions (supply chain and freight), up 1.3 percent

Companies witnessing decline in year over year revenues include:

  • DSV, down 13.7 percent
  • Panalpina, down 11.6 percent
  • DHL Supply Chain and Global Forwarding, down 9.4 percent
  • Logwin, down 6.3 percent
  • Agility, down 6 percent. The table below lists the 1st Quarter FY15 performance of the top sixteen publicly traded 3PLS. For this quarter we have excluded Hitachi Transport System, Ltd. The company has decided to adopt International Financial Reporting Standards (IFRS) (which begins in January and ends in December), in place of accounting principles generally accepted in Japan (JGAAP) (which begins in April and ends in March) for its consolidated financial statements. But the company did not report its reconciled report yet.
  • Remember, based on our definition, we are excluding asset-based transportation revenues from Agility, Hyundai, J B Hunt and Norbert Dentressangle.

 

Supplier 1Q15($M) 1Q14 ($M) YoY % change Portion of Revenues Not Considered
Agility $953.2 $1,013.6 -6.0% Infrastructure Business
C.H. Robinson Worldwide $3,300.9 $3,142.6 5.0%
CEVA Logistics $1,776.0 $1,865.0 -4.8%
DHL Supply Chain and Global Forwarding $8,724.5 $9,632.2 -9.4% Post, e-commerce, Parcel and Express
DSV $1,749.7 $2,028.5 -13.7% Solutions Business
Expeditors International of Washington $1,677.5 $1,491.6 12.5%
Hyundai GLOVIS $3,011.8 $2,993.4 0.6% Used Car Auction
JBHunt $508.0 $485.0 4.7% Intermodal and Truckload are Asset Based
Kuehne + Nagel $4,476.9 $4,684.8 -4.4% Overland is Asset Based
Logwin $194.3 $207.3 -6.3% Solutions Business
Menlo/ Conway $1,411.4 $1,410.4 0.1% Not Considered Corporate Eliminations
Norbert Dentressangle $823.8 $781.1 5.5% Transport is Asset Based
Panalpina $1,580.7 $1,788.5 -11.6%
Ryder $693.7 $709.7 -2.3% Lease rental and Fuel Services
UPS Supply Chain Solutions (supply chain and freight) $2,193.0 $2,164.0 1.3% US Domestic and International Package
UTi Worldwide (1Q ends in April) $973.3 $1,045.0 -6.9%
Total $34,048.7 $35,442.7 -3.9%  

 

If you would like a complete copy of this analysis, including the results of the sixteen 3PLs covered, please contact chanf@arcweb.com.

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