Radiant Logistics Inc (RLGT) Q3 2025 Earnings Call Highlights: Strong Financial Performance ...

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Tue, May 13, 2025, 1:08 AM 5 min read

Adjusted EBITDA: $9.4 million for Q3 FY2025, up $4.2 million or over 80% year-over-year.
Net Income: $2.541 million for Q3 FY2025, compared to a net loss of $703,000 in Q3 FY2024.
Revenue: $214 million for Q3 FY2025, up from $184.6 million in Q3 FY2024.
Adjusted Net Income: $6.881 million for Q3 FY2025, up from $3.586 million in Q3 FY2024, an increase of approximately 91.9%.
Cash on Hand: Approximately $19 million as of March 31, 2025.
Credit Facility: $15 million drawn on a $200 million credit facility.
Acquisitions Impact: $2 million in adjusted EBITDA from recent acquisitions including Cascade Transportation, Foundation Logistics & Services, TCB Transportation, and Transcon Shipping.
Gross Margin Impact: Estimated 25% to 30% impact from tariffs in the March quarter.

Warning! GuruFocus has detected 5 Warning Signs with RLGT.

Release Date: May 12, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Radiant Logistics Inc (RLGT) reported a significant increase in adjusted EBITDA, up 80% year-over-year to $9.4 million for the third fiscal quarter.
The company's diverse service offerings and recent acquisitions contributed positively to financial performance, with acquisitions adding $2 million in adjusted EBITDA.
Radiant Logistics Inc (RLGT) maintains a strong balance sheet with $19 million in cash and only $15 million drawn on a $200 million credit facility.
The company continues to pursue a strategy of profitable growth through organic initiatives and acquisitions, including recent acquisitions of Transcon Shipping and other strategic partners.
Radiant Logistics Inc (RLGT) is well-positioned to navigate market volatility with a durable business model and a robust North American footprint.

Negative Points

The company anticipates near-term volatility due to ongoing US trade negotiations and tariffs, which could impact 25% to 30% of gross margins.
There is uncertainty regarding the impact of international trade tensions on future performance, particularly in the June quarter.
The traditional seasonality of the business is disrupted, leading to expectations of a softer June quarter.
Currency fluctuations and changes in trade policies could pose challenges to the company's operations and profitability.
The company faces potential risks from the evolving geopolitical landscape, which could affect global trade dynamics and customer behavior.

Q & A Highlights

Q: Could you elaborate more on what drove the outperformance of the base business this quarter? And given your commentary on the bullwhip effect, could you talk about the expectations for the June quarter? A: Bohn Crain, CEO: It's early to provide detailed insights into the June quarter. We have seen some slowing in international trade volumes due to trade tensions, but early indications for April suggest the business is performing better than expected. The situation is fluid, and while there may be near-term impacts, we are optimistic about offsetting them with a surge in global trade as supply chains reset. Our presence in Canada and Mexico has been beneficial amid these dynamics. However, we expect the June quarter to be soft.

Q: Looking back at the March quarter, was there broad-based strength or any specific areas of outperformance? A: Todd Macomber, CFO: Canada performed better than anticipated, and while some international volumes were down, the margin characteristics per file improved. The acquisitions we completed also contributed to the overall increase in the quarter.

Q: Given the recent tariff news, what trends have you seen in Asia bookings, and how are shippers expected to react? A: Bohn Crain, CEO: Ocean imports from China had come to a standstill, but we expect this to be short-lived. There has been movement to find alternative sources, and while some damage has been done, we anticipate a return to normalcy. Our recent acquisition of Transcon, which focuses on ocean imports from Asia, is particularly relevant in this context.

Q: Can you clarify what you meant by saying 25% to 30% of gross margin was affected by international trade? A: Bohn Crain, CEO: 25% to 30% of our gross margin is associated with international trade, which presents an opportunity to engage with customers and help them navigate the situation. Our customs brokerage capability and PO management platform have been busy assisting customers in adapting to these changes.

Q: With the recent thaw in US-China relations, what business areas remain impacted, and what might improve? A: Bohn Crain, CEO: There was already a trend towards diversifying supply chains before the tariff discussions, and this volatility reinforces that strategy. While some short-term impacts are inevitable, we are focused on long-term strategies and continue to pursue M&A activities despite the noise around tariffs.

Q: How do currency fluctuations impact your business? A: Bohn Crain, CEO: We have some exposure to the Canadian dollar, but most of our business is conducted in US dollars. The impact of currency changes on the landed cost of goods is complex and would require detailed analysis.

Q: Do you expect the fourth quarter to be the second strongest quarter this year, given the current uncertainties? A: Bohn Crain, CEO: Traditional seasonality is currently out the window due to uncertainties. We expect softness in the June quarter and do not anticipate it being our second strongest quarter. However, we believe any losses in the June quarter will be recaptured in fiscal '26.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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