Ryder(US:R)2025-10-23 20:01Financial Performance - Diluted EPS from continuing operations was $3.33, up 2% from the prior year, and comparable EPS increased 4% to $3.57, reflecting higher contractual earnings and share repurchases [88]. - Total revenue for Q3 2025 was $3.2 billion, consistent with the prior year, while operating revenue increased 1% to $2.6 billion, driven by growth in Supply Chain Solutions (SCS) and Fleet Management Solutions (FMS) [91]. - Services revenue for Q3 2025 was $2.1 billion, a decrease of 1% from the prior year, while gross margin decreased to $309 million, reflecting higher medical costs and e-commerce network performance issues [94]. - Total revenue for Q3 2025 was $3,171 million, a slight increase from $3,168 million in Q3 2024, with total revenue for the nine months at $9,490 million, consistent with the prior year [115]. - Earnings from continuing operations before income taxes increased by 1% in Q3 2025 to $190 million and by 6% for the nine months to $508 million [115]. - Net earnings for Q3 2025 were $138 million, a slight decrease from $142 million in Q3 2024, while net earnings for the nine months ended September 30, 2025, were $367 million, up from $354 million in 2024 [171]. - Adjusted net earnings for the twelve months ended September 30, 2025, were $508 million, compared to $484 million in 2024, reflecting a strong performance despite market challenges [176]. Revenue Breakdown - Fleet Management Solutions revenue was $1,465 million in Q3 2025, a decrease of 0% from the prior year, while Supply Chain Solutions revenue increased by 5% to $1,380 million [115]. - FMS total revenue for Q3 2025 was $1,465 million, a slight decrease of 1% compared to Q3 2024, while total revenue for the nine months ended September 30, 2025, was $4,379 million, down 1% from the previous year [121]. - Supply Chain Solutions (SCS) total revenue for Q3 2025 was $1,380 million, up 5% from Q3 2024, and for the nine months, it increased by 3% to $4,077 million [132]. - DTS total revenue decreased by 10% in Q3 2025 and 3% for the nine months ended September 30, 2025, primarily due to lower operating revenue and subcontracted transportation costs [137]. Expenses and Costs - SG&A expenses increased by 3% in Q3 2025 to $380 million, and by 1% for the nine months ended September 30, 2025, totaling $1,123 million, maintaining 12% of total revenue [103]. - Interest expense increased by 4% in Q3 2025 to $102 million and by 6% for the nine months to $304 million, primarily due to higher average debt [108]. - Non-operating pension costs remained unchanged at $10 million for Q3 2025 and decreased by 10% to $27 million for the nine months ended September 30, 2025 [104]. Cash Flow and Capital Expenditures - Free cash flow for the nine months ended September 30, 2025, was $496 million, a significant increase of 128% compared to the prior year [89]. - Total capital expenditures for the nine months ended September 30, 2025, were $1.6 billion, a decrease of 19% compared to the prior year [89]. - Gross capital expenditures decreased to $1.6 billion for the nine months ended September 30, 2025, down from $2.0 billion in 2024, reflecting reduced investments in ChoiceLease and rental vehicles [146]. - Net cash provided by operating activities from continuing operations was $1.8 billion for the nine months ended September 30, 2025, compared to $1.7 billion in the prior year, primarily due to lower income tax payments [142]. Debt and Equity - The debt to equity ratio increased to 254% in September 2025, up from 250% in the prior year, indicating a slight increase in financial leverage [89]. - The variable-rate portion of total debt was 22% as of September 30, 2025, up from 18% as of December 31, 2024 [158]. - The company declared a quarterly cash dividend of $0.91 per share in October 2025, an increase from $0.81 per share in October 2024 [160]. - The corporate revolving credit facility's committed borrowing capacity was increased to $1.6 billion, expiring in April 2030, primarily used for general corporate purposes [154]. Operational Challenges and Market Conditions - The company faced risks including decreased demand for services and products due to economic conditions, which could lead to lower profit margins and increased bad debt [179]. - The company highlighted potential challenges in maintaining pricing levels due to competition and economic conditions [179]. - The company noted that higher borrowing costs and inflationary pressures could impact financial performance [182]. - The company indicated that there were no changes in internal control over financial reporting that materially affected such controls during the reporting period [186]. - The company reported that it may face difficulties in attracting and retaining professional drivers and technicians due to labor shortages [182]. - The company acknowledged the impact of geopolitical events and financial institution disruptions on its operations [179]. Strategic Initiatives - The company plans to reinvest earnings from foreign subsidiaries to support future growth initiatives and strategic investments [177]. - The company purchased a total of 516,283 shares of its common stock during the three months ended September 30, 2025, at an average price of $183.59 per share [191]. - The company maintained two share repurchase programs approved by its board of directors in October 2023 and 2024 [192].