Radiant Logistics has bolstered its financing arrangements and delivered quarterly results that beat market expectations, leading to an acceleration of its acquisition strategy. Shares of the US-based third-party logistics provider (3PL) jumped 12.4% in after-hours trading on Monday after it released its latest financial results.

The company reported revenue of $280 million for the first quarter of fiscal 2014, ended September 30, an increase of 23% compared to the same period last year. The figure also surpassed the analysts’ consensus estimate by $34 million.

Adjusted net income was $8.6 million, or $0.18 a share. That was an increase of 9 cents year over year and 6 cents above market expectations.

The profitability ratios also improved considerably. Adjusted EBITDA was $12.2 million, up nearly 80% year-over-year and 18% quarter-over-quarter. Adjusted EBITDA margin widened 630 basis points to 17.7%, meanwhile.

Several operational developments have contributed to the improvement. Consolidation of its transportation management systems and increased airfreight volumes related to disaster relief activities also benefited Radiant. Those extra shipments brought in $1 million to $2 million.

The comparison was also affected by credit loss of $1.3 million recorded during the year-ago quarter in connection with the First Brands bankruptcy.

Radiant Logistics

FQ1/27

FQ1/26

Y/Y Gross Change

Y/Y % Change

Revenue

$279.8

$226.7

$53.1

23.4%

Net Revenue

$68.6

$59.5

$9.2

15.4%

Net Revenue Margin %

24.5%

26.2%

-170 bps

-6.5%

Adjusted EBITDA

$12.2

$6.8

$5.4

79.2%

Adjusted EBITDA Margin %

17.7%

11.4%

632 bps

55.3%

Adjusted EPS

$0.18

$0.09

$0.09

100.0%

Adjusted EBITDA margin is EBITDA as a percentage of net revenue - $ in millions except per share amounts

Radiant’s key performance indicators.

The company finished the quarter with no net debt, providing additional financial flexibility as it looks to pursue further expansion opportunities.

Expanded credit facility creates greater acquisition capacity

Radiant had already taken steps to reinforce its financial position in August, when it amended its $200 million revolving credit facility. The revised agreement extended the maturity of the credit line by five years and increased its accordion feature, designed to support acquisitions, from $75 million to $100 million.

The additional capacity gives the company greater room to pursue transactions while maintaining its established approach to disciplined expansion.

Bohn Crain, Radiant Logistics’ founder and CEO, said the enhanced financing structure complements the company's long-term development strategy.

“That capacity, together with our long-term strategy of growing organically where our network gives us an advantage and supplementing that growth through disciplined acquisitions, positions us well to build on the encouraging signs of a domestic freight recovery while continuing to help customers navigate a volatile global trade environment,” Crain said in a news release.

Recent acquisitions strengthen Radiant’s logistics network

The company’s acquisition ambitions build on several years of activity in the third-party logistics market. Radiant has expanded its portfolio through the purchase of multiple 3PL businesses while also converting agent stations into company-owned operations.

Its latest transaction involved the acquisition of the Dallas brokerage business of Whitacre Logistics Services in October. The operation primarily serves customers across the building materials, manufacturing and packaging industries, adding further capabilities to Radiant’s multimodal brokerage platform.

The company also pursued international expansion last year. It secured a majority stake in Weport, a logistics operator headquartered in Mexico City, extending its presence in the Mexican market.

That transaction followed the acquisition of Transcon Shipping, a California-based freight forwarder specializing in air and ocean freight.

Strong international performance amid tighter freight markets

Radiant’s latest financial performance comes against a challenging backdrop for global trade, with continued market volatility affecting logistics operations and customer demand.

Despite these conditions, the company is reporting solid international results while both the domestic truckload and intermodal markets are experiencing significant tightening.

The combination of improved operating performance, the absence of net debt and a larger acquisition facility places Radiant in a stronger position to pursue further consolidation within the 3PL sector.

The company is raising its acquisition capability to $100 million to take advantage of openings in a shifting freight market and continue to grow its network through organic growth and selective purchases.