Higher retail and wholesale used truck prices helped Ryder System boost net profit nearly 17 percent year-over-year in the second quarter to $46.7 million.
The truck leasing and supply chain giant’s total revenue rose 3 percent from a year ago to $1.56 billion, fueled in part by acquisitions and new business.
The $6 billion company raised earnings and revenue despite what Chairman and CEO Greg Swienton called “an uneven economic environment” in the quarter.
Ryder benefited from shipper attempts to secure capacity by renting or leasing equipment, outsourcing logistics (using 3PLs and brokers) and choosing dedicated contract carriage.
“Our contractual full service lease and supply chain offerings continued to perform well and in line with expectations,” Swienton said in a statement.
He said he expects third-quarter earnings to be up 6 to 12 percent from the same period in 2011, and raised Ryder’s full-year per share earnings forecast.
The Miami-based company now expects 2012 earnings in the $3.75 to $3.90 range, compared with an earlier forecast of $3.65 to $3.85 per share, Swienton said.
Fleet Management Solutions, Ryder’s largest segment, benefited from stronger full-service lease and rental business, increasing revenue 3 percent to $1.1 billion.
Full-service lease revenue was up 5 percent, in part thanks to the acquisition of U.K.-based Hill Hire in June 2011. Commercial rental sales were up 10 percent.
Rental fleet utilization dropped in North America, however. Ryder said rental power fleet utilization dropped to 75 percent as its rental fleet expanded 17 percent.
The Supply Chain Solutions segment, which includes all of Ryder’s dedicated contract carriage business, increased revenue 6 percent to $570.3 million.
The SCS segment benefited from higher automotive volumes and new business and increased dedicated carriage activity.
“Near-term economic conditions are likely to remain uneven and challenging, particularly for our transactional offerings,” said Swienton.
However, long-term trends driving increased use of contractual transportation and logistics and supply chain services “remain solidly in place,” he said.