Ryder System net profit dropped a sharp 69 percent to $61.9 million in 2009, as it closed its money losing supply chain management operations in South America and Europe.
Revenue in the fourth quarter fell 7 percent to $1.2 billion. For the full year, revenue fell 19 percent to $4.9 billion. Net profit dropped 23 percent to $8.2 million in the fourth quarter.
The Miami-based transportation company’s results reflect significantly lower fleet management revenue due to decreased full service leasing as well as higher pension expense, reduced commercial rental performance, and lower results from used vehicle sales operations.
The company previously announced a plan to discontinue supply chain operations in South America and Europe. During the third quarter of 2009, Ryder Supply Chain Solutions ceased customer operations in all South American markets and part of Europe. During the fourth quarter of 2009, SCS customer operations shut down in all of Europe.
"We continued to manage the business effectively through the challenges of the prolonged multi-year freight recession which extended through the fourth quarter,” said Ryder Chairman and CEO Greg Swienton. “Fleet Management Solutions customers continued to cope with reduced freight activity by downsizing their fleets, primarily at the end of their contractual term.”
Ryder cut back fleet size to improve margins even as rental demand remained soft, Swienton said.
Contact Thomas L. Gallagher at email@example.com.