Management from supply chain software-as-a-service provider Descartes noted several headwinds in the market currently but said it was confident the company will continue to perform.
Descartes (NASDAQ: DSGX) reported earnings per share of 32 cents for the 2024 fiscal second quarter, ended July 31, after the market closed Wednesday. The result was a penny light of the consensus estimate but a nickel higher year over year (y/y).
CEO Ed Ryan said softer consumer demand and elevated retail inventories may weigh on fall replenishment cycles. Currently, shipment volumes are tepid, largely tracking pre-pandemic trends, and reduced volumes through the Panama Canal could impact freight flows in the near term.
“We’ll see what happens but we like our chances either way,” Ryan said.
The Canada-based company reported record revenue of $143 million, which was 17% higher y/y and exceeded management’s guidance of $120.5 million. Adjusted earnings before interest, taxes, depreciation and amortization totaled $61 million, which was 12% higher y/y and within management’s long-term annual guidance range of 10% to 15% growth. The company previously guided to $44.5 million in adjusted EBITDA for the quarter.
Cloud-based acquisitions fueled the growth.
Descartes acquired final-mile solutions provider GroundCloud in February, and in May it added Localz, an order management service.
The company guided fiscal third-quarter revenue of approximately $124 million with adjusted EBITDA of $46 million.
Descartes generated $52 million in operating cash flow during the quarter, ending the period with $227 million in cash and no debt. The company’s cash position increased $38 million from the year-ago period.
More FreightWaves articles by Todd Maiden
- Forward Air says ‘earned trust’ a must after Omni acquisition
- XPO holds volume gains in August
- August transportation prices decline at slowest pace in a year
Brokerage Compliance Symposium
The day before F3. Every compliance issue you face - fraud exposure, carrier liability, FMCSA rules, cargo theft, insurance gaps - navigated by attorneys and operators defining best practices in a changing industry.
F3 Awards Dinner
The night before F3. FreightTech100 companies honored. FreightTech 25 and Shipper of Choice winners revealed live. Cocktail reception into dinner and live music - 300 industry leaders in one purpose-built room.
F3: Future of Freight Festival
Industry-defining keynotes, rapid-fire technology demos, and industry leaders networking in experiences across Chattanooga - plus the inaugural F3 Awards Dinner featuring the FreightTech and Shipper of Choice reveals.
The day before F3. Every compliance issue you face - fraud exposure, carrier liability, FMCSA rules, cargo theft, insurance gaps - navigated by attorneys and operators defining best practices in a changing industry.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register NowThe night before F3. FreightTech100 companies honored. FreightTech 25 and Shipper of Choice winners revealed live. Cocktail reception into dinner and live music - 300 industry leaders in one purpose-built room.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register NowIndustry-defining keynotes, rapid-fire technology demos, and industry leaders networking in experiences across Chattanooga - plus the inaugural F3 Awards Dinner featuring the FreightTech and Shipper of Choice reveals.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register Now