News Release

UTi Worldwide Reports Fiscal 2014 Second Quarter Results
New Freight Forwarding Operating System Launched in the United States

LONG BEACH, Calif., Sept. 6, 2013 (GLOBE NEWSWIRE) -- UTi Worldwide Inc. (Nasdaq:UTIW) today reported financial results for its fiscal 2014 second quarter ended July 31, 2013.

Fiscal Second Quarter 2014 vs. 2013 Results:

  • Revenues were $1,129.4 million, a decrease of 4.5 percent from $1,182.9 million.
  • Net revenues (revenues minus purchased transportation costs) were $385.6 million, a decrease of 5.0 percent from $406.1 million.
  • Net loss attributable to UTi Worldwide Inc. was $4.4 million, or $0.04 per diluted share, compared to net income of $18.9 million, or $0.18 per diluted share.
  • Adjustments to GAAP net loss in the fiscal 2014 second quarter included after-tax severance costs of $2.4 million, or $0.02 per diluted share. In addition, the company increased its valuation allowance on deferred tax assets by $7.5 million, or $0.07 per diluted share.
  • Excluding adjustments described above, non-GAAP net income attributable to UTi Worldwide Inc. was $5.5 million, or $0.05 per diluted share
  • All references to adjusted items and organic items in this release refer to non-GAAP results. A reconciliation of GAAP to these non-GAAP results is provided in the supplemental financial information attached to this release.

Eric W. Kirchner, chief executive officer, said, "Our results in the fiscal 2014 second quarter continue to reflect a lackluster global economy, challenging trading conditions and costs associated with our comprehensive business process transformation. The results underscore the importance of completing our transformation, and we have continued to make significant progress in that area. Since July 1, we have deployed our new freight forwarding operating system in seven countries – including the United States, United Kingdom and Hong Kong. There are currently 22 countries on the system to-date. In particular, the U.S. launch is a notable milestone in our deployment process. The implementation of our proprietary system in our largest market demonstrates that the platform works and is scalable. The 22 countries on the new system represent approximately 35 percent of total freight forwarding shipments. We continue to expect that more than 70 percent of shipments will be on the new system by the end of fiscal 2014."

Kirchner continued, "Revenues in the second quarter of fiscal 2014 were lower than the same period last year, with declines seen in both segments. Freight forwarding was impacted by lower pricing, which was partially offset by a modest increase in volumes. Airfreight tonnage was slightly higher in the second quarter for the first time in more than two years. Ocean freight continued to show steady volume growth in the second quarter. Net revenue per kilo and TEU declined in the fiscal 2014 second quarter compared to the same period last year, but improved modestly on a sequential basis as carrier rates declined. Contract logistics was affected by currency translation, as well as the previously reported exit of underperforming business in Europe and conclusion of certain high-margin accounts."

Revenues and net revenues decreased 4.5 percent and 5.0 percent, respectively, in the fiscal 2014 second quarter compared to the same period last year. On an organic basis, revenues decreased 2.2 percent, while net revenues declined 1.6 percent in the fiscal 2014 second quarter, compared to the same period last year.

Operating expenses less purchased transportation costs were $375.6 million in the second quarter of fiscal 2014. Severance costs in the fiscal 2014 second quarter were $3.2 million on a pre-tax basis, compared to $2.1 million in the same period last year. Excluding the impact of severance, adjusted operating expenses less purchased transportation costs were $372.4 million, compared to $370.9 million in the same period last year. The increase reflects costs associated with transformation related activities and investments in sales and facilities that were previously reported. On an organic basis, adjusted operating expenses less purchased transportation costs increased 3.6 percent, compared to the same period last year.

The company recorded a tax provision of $9.4 million in the fiscal 2014 second quarter on pretax income of $5.9 million. This is primarily due to a $7.5 million addition to valuation allowances on deferred tax assets as a result of the unprofitability of certain operations.

Investor Conference Call:

UTi management will host an investor conference call today, September 6, 2013, at 8:00 a.m. PDT (11:00 a.m. EDT) to review the company's financial results for the fiscal 2014 second quarter. Investment professionals are invited to participate in the live call by dialing 877-941-0844 (domestic) or 480-629-9692 (international) using conference ID 4636573. The call will be open to all interested investors through a live, listen-only audio Internet broadcast at www.go2uti.com. For those who are not available to listen to the live broadcast, the call will be archived for one year at both Web sites. A telephonic playback of the conference call also will be available from approximately 11:00 a.m. PDT, today, through September 10, 2013, by calling 800-406-7325 (domestic) or 303-590-3030 (international) and using replay passcode 4636573.

About UTi Worldwide:

UTi Worldwide Inc. is an international, non-asset-based supply chain services and solutions company providing air and ocean freight forwarding, contract logistics, customs brokerage, distribution, inbound logistics, truckload brokerage and other supply chain management services. The company serves a large and diverse base of global and local companies, including clients operating in industries with unique supply chain requirements such as the pharmaceutical, retail, apparel, chemical, automotive and technology industries. The company seeks to use its global network, proprietary information technology systems, relationships with transportation providers, and expertise in outsourced logistics services to deliver competitive advantage to each of its clients' supply chains.

Use of Non-GAAP Financial Information:

This press release includes "non-GAAP financial measures" within the meaning of the Securities and Exchange Commission rules. UTi believes that meaningful analysis of its financial performance requires an understanding of the factors underlying that performance and the company's judgments about the likelihood that particular factors will repeat. Short-term patterns and long-term trends may be obscured by the impact of certain items. For this reason, the company has included information in this press release relating to organic revenue and organic net revenue changes, which are adjusted to exclude the impact of currency fluctuations between comparable periods. The company also has referred to operating expenses less purchased transportation costs, and to adjusted operating expenses less purchased transportation costs, which are operating expenses less purchased transportation costs that are further adjusted to exclude severance costs. The company has also included information relating to organic adjusted operating expenses less purchased transportation costs, which are adjusted operating expenses less purchased transportation costs that are further adjusted to exclude the impact of currency fluctuations between comparable periods. The company has further referred to non-GAAP net income attributable to UTi Worldwide Inc., which is adjusted to exclude severance costs and valuation allowances on deferred tax assets, as described above, and non-GAAP earnings per diluted share. This information is among the information the company uses as a basis for evaluating company performance on a comparable basis over time, allocating resources and planning and forecasting of future periods. The company has also provided this information because such adjustments make performance information more comparable to prior disclosures for investors, and may enhance the ability of investors to analyze the company's performance. This information is not intended to be considered in isolation or as a substitute for, or superior to, the relevant measures prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the tables at the end of this press release.

Safe Harbor Statement:

Certain statements in this news release may be deemed to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The company intends that all such statements be subject to the "safe-harbor" provisions contained in those sections. Such forward-looking statements may include, but are not limited to, statements about the status and timing of the company's freight forwarding operating system, including plans to have more than 70 percent of shipments on the new system by the end of fiscal 2014 and any other statements not of an historical nature. Many important factors may cause the company's actual results to differ materially from those discussed in any such forward-looking statements, including but not limited to: volatility with respect to global trade, particularly as it relates to the global airfreight, ocean freight and contract logistics and distribution markets; global economic, political and market conditions, including those in Africa, Asia and EMENA; risks associated with the company's business transformation initiative, which include unanticipated difficulties, delays, additional costs and expenses; changes in interest and foreign exchange rates; risks that the company might be required to record impairment charges to goodwill or additional increases in its valuation allowance on deferred tax assets; risks associated with the company's ability to satisfy financial covenants in connection with its credit facilities and note purchase agreement in the future and its ability to amend, refinance, renew or replace its credit facilities, note purchase agreement and other indebtedness on commercially reasonable terms or at all; risks associated with the profitability of certain operations and changes in statutory tax rates worldwide, changes in the geographic composition of the company's worldwide taxable income, changes in the company's unrecognized tax positions, and the impact of audit settlements with local tax authorities; volatile fuel costs; transportation capacity, pricing dynamics and the ability of the company to secure space on third party aircraft, ocean vessels and other modes of transportation; material interruptions in transportation services; risks of international operations; risks associated with, and the potential for penalties, fines, costs and expenses the company may incur as a result of the ongoing publicly announced governmental investigations into the international air freight and air cargo transportation industry and other related investigations and lawsuits; risks of adverse legal judgments and other liabilities not limited by contract or covered by insurance; the financial condition of the company's customers; disruptions caused by epidemics, natural disasters, conflicts, wars and terrorism; and the other risks and uncertainties described in "Risk Factors" and "Forward-looking Statements" in the company's Annual Report on Form 10-K for the fiscal year ended January 31, 2013, any subsequently filed Quarterly Reports on Form 10-Q and as described in the company's other filings with the Securities and Exchange Commission. In light of the significant uncertainties inherent in the forward-looking information included herein, the inclusion of such information should not be regarded as a representation by UTi or any other person that UTi's objectives or plans will be achieved in the timeframe anticipated or at all. Investors are cautioned not to place undue reliance on the company's forward-looking statements. UTi undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

(Tables Follow)

UTi Worldwide Inc.
Condensed Consolidated Statements of Operations
(in thousands, except share and per share amounts)
         
  Three months ended Six months ended
  July 31, July 31,
  2013 2012 2013 2012
  (Unaudited) (Unaudited)
         
Revenues:        
Airfreight forwarding  $ 355,120  $ 370,394  $ 678,949  $ 751,534
Ocean freight forwarding  318,687  332,041  622,465  637,122
Customs brokerage  32,308  30,414  62,126  58,680
Contract logistics  186,377  203,818  367,059  405,471
Distribution   145,246  146,514  292,956  295,402
Other  91,680  99,749  186,516  203,378
Total revenues  1,129,418  1,182,930  2,210,071  2,351,587
         
Other operating expenses:        
Purchased transportation costs:        
Airfreight forwarding  274,926  286,684  525,398  588,506
Ocean freight forwarding  265,348  280,352  522,323  535,231
Customs brokerage  4,032  1,336  5,374  2,779
Contract logistics  45,956  54,370  90,414  104,353
Distribution   103,004  102,225  204,212  199,232
Other  50,504  51,892  100,967  109,648
         
Staff costs  224,280  225,330  444,492  456,518
Depreciation  12,956  11,229  26,138  22,725
Amortization of intangible assets  2,754  3,160  5,546  6,402
Severance and other  3,180  2,124  5,849  3,824
Other operating expenses  132,403  131,198  265,306  265,799
Total other operating expenses  1,119,343  1,149,900  2,196,019  2,295,017
Operating income  10,075  33,030  14,052  56,570
Interest expense, net  (3,447)  (2,494)  (6,740)  (5,302)
Other expense, net  (720)  (272)  (962)  (300)
Pretax income  5,908  30,264  6,350  50,968
Provision for income taxes  9,414  10,047  20,720  16,521
Net (loss)/income  (3,506)  20,217  (14,370)  34,447
Net income attributable to non-controlling interests  938  1,334  2,492  2,678
         
Net (loss)/income attributable to UTi Worldwide Inc.  $ (4,444)  $ 18,883  $ (16,862)  $ 31,769
         
Basic (loss)/earnings per common share attributable to UTi Worldwide Inc. common shareholders  $ (0.04)  $ 0.18  $ (0.16)  $ 0.31
         
Diluted (loss)/earnings per common share attributable to UTi Worldwide Inc. common shareholders  $ (0.04)  $ 0.18  $ (0.16)  $ 0.31
         
Number of weighted average common shares outstanding used for per share calculations        
Basic shares  104,608,931  103,609,889  104,310,510  103,323,012
Diluted shares  104,608,931  103,893,040  104,310,510  103,920,826
 
 
UTi Worldwide Inc.
Condensed Consolidated Balance Sheets
(in thousands)
     
  July 31, 2013 January 31, 2013
  (Unaudited)
     
ASSETS    
Cash and cash equivalents  $ 178,125  $ 237,276
Trade receivables, net  1,012,598  898,809
Deferred income taxes  15,854  19,595
Other current assets  158,390  156,385
Total current assets  1,364,967  1,312,065
     
Property, plant and equipment, net  238,749  242,898
Goodwill and other intangible assets, net  462,674  457,635
Investments  1,057  969
Deferred income taxes  20,916  25,802
Other non-current assets  36,520  34,688
Total assets  $ 2,124,883  $ 2,074,057
     
LIABILITIES & EQUITY    
Bank lines of credit  $ 133,738  $ 79,213
Short-term borrowings  1,514  1,129
Current portion of long-term borrowings  2,417  5,663
Current portion of capital lease obligations  11,448  11,377
Trade payables and other accrued liabilities  835,251  786,444
Income taxes payable  9,822  8,470
Deferred income taxes  1,946  2,775
Total current liabilities  996,136  895,071
     
Long-term borrowings, excluding current portion  203,630  204,434
Capital lease obligations, excluding current portion  65,218  73,538
Deferred income taxes  30,238  29,654
Other non-current liabilities  44,290  47,178
     
Commitments and contingencies    
     
UTi Worldwide Inc. shareholders' equity:    
Common stock  510,934  505,237
Retained earnings  373,802  396,946
Accumulated other comprehensive loss  (112,949)  (92,348)
Total UTi Worldwide Inc. shareholders' equity  771,787  809,835
Non-controlling interests  13,584  14,347
Total equity  785,371  824,182
Total liabilities and equity  $ 2,124,883  $ 2,074,057
 
 
UTi Worldwide Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
     
  Six months ended July 31,
  2013 2012
  (Unaudited)
     
OPERATING ACTIVITIES:    
Net (loss)/income  $ (14,370)  $ 34,447
Adjustments to reconcile net (loss)/income to net cash used in operating activities:    
Share-based compensation costs  6,869  7,050
Depreciation  26,138  22,725
Amortization of intangible assets  5,546  6,402
Amortization of debt issuance costs  346  658
Deferred income taxes  4,516  3,274
Uncertain tax positions  (148)  (250)
Excess tax benefits from share-based compensation  (73)  (132)
(Gain)/loss on disposal of property, plant and equipment  (696)  37
Provision for doubtful accounts  2,814  449
Other  2,859  1,146
Net changes in operating assets and liabilities  (80,464)  (90,180)
Net cash used in operating activities  (46,663)  (14,374)
     
INVESTING ACTIVITIES:    
Purchases of property, plant and equipment, excluding software  (26,332)  (19,561)
Proceeds from disposals of property, plant and equipment  1,884  2,332
Purchases of software and other intangible assets  (18,387)  (15,576)
Net increase in other non-current assets  (2,869)  (1,016)
Other  (99)  116
Net cash used in investing activities  (45,803)  (33,705)
     
FINANCING ACTIVITIES:    
Net borrowings under bank lines of credit  59,687  29,677
Net increase in short-term borrowings  441  -- 
Proceeds from issuances of long-term borrowings  550  1,986
Repayments of long-term borrowings  (4,617)  (11,045)
Debt issuance costs  --   (1,098)
Repayments of capital lease obligations  (7,882)  (9,759)
Distributions to non-controlling interests and other  (2,152)  (2,433)
Ordinary shares settled under share-based compensation plans  (2,487)  (2,450)
Proceeds from issuance of ordinary shares  2,461  1,592
Excess tax benefits from share-based compensation  73  132
Dividends paid  --   (6,223)
Net cash provided by financing activities  46,074  379
     
Effect of foreign exchange rate changes on cash and cash equivalents  (12,759)  (11,300)
Net decrease in cash and cash equivalents  (59,151)  (59,000)
     
Cash and cash equivalents at beginning of period  237,276  321,761
     
Cash and cash equivalents at end of period  $ 178,125  $ 262,761
 
 
UTi Worldwide Inc.
Segment Reporting        
(in thousands)        
(Unaudited)        
  Three months ended July 31, 2013
 
Freight
Forwarding
Contract
Logistics and
Distribution


Corporate


Total
         
Revenues  $ 768,803  $ 360,615  $ --   $ 1,129,418
         
Purchased transportation costs  585,374  158,396  --   743,770
Staff costs  108,803  105,140  10,337  224,280
Depreciation  3,939  7,566  1,451  12,956
Amortization of intangible assets  1,121  1,207  426  2,754
Severance and other  2,193  317  670  3,180
Other operating expenses  46,531  78,148  7,724  132,403
Total operating expenses  747,961  350,774  20,608  1,119,343
Operating income/(loss)  $ 20,842  $ 9,841  $ (20,608)  10,075
Interest expense, net        (3,447)
Other expense, net        (720)
Pretax income        5,908
Provision for income taxes        9,414
Net loss        (3,506)
Net income attributable to non-controlling interests        938
Net loss attributable to UTi Worldwide Inc.        $ (4,444)
         
         
UTi Worldwide Inc.        
Segment Reporting        
(in thousands)        
(Unaudited)        
         
  Three months ended July 31, 2012
 
Freight
Forwarding
Contract
Logistics and
Distribution


Corporate


Total
         
Revenues  $ 797,375  $ 385,555  $ --   $ 1,182,930
         
Purchased transportation costs  610,646  166,213  --   776,859
Staff costs  107,602  108,863  8,865  225,330
Depreciation  4,043  6,647  539  11,229
Amortization of intangible assets  1,017  1,603  540  3,160
Severance and other  1,509  283  332  2,124
Other operating expenses  44,421  82,292  4,485  131,198
Total operating expenses  769,238  365,901  14,761  1,149,900
Operating income/(loss)  $ 28,137  $ 19,654  $ (14,761)  33,030
Interest expense, net        (2,494)
Other expense, net        (272)
Pretax income        30,264
Provision for income taxes        10,047
Net income        20,217
Net income attributable to non-controlling interests        1,334
Net income attributable to UTi Worldwide Inc.        $ 18,883
         
         
UTi Worldwide Inc.        
Segment Reporting        
(in thousands)        
(Unaudited)        
         
  Six months ended July 31, 2013
 
Freight
Forwarding
Contract
Logistics and
Distribution


Corporate


Total
         
Revenues  $ 1,488,319  $ 721,752  $ --   $ 2,210,071
         
Purchased transportation costs  1,135,337  313,351  --   1,448,688
Staff costs  213,871  211,417  19,204  444,492
Depreciation  8,222  15,362  2,554  26,138
Amortization of intangible assets  2,241  2,443  862  5,546
Severance and other  2,429  1,309  2,111  5,849
Other operating expenses  92,579  157,720  15,007  265,306
Total operating expenses  1,454,679  701,602  39,738  2,196,019
Operating income/(loss)  $ 33,640  $ 20,150  $ (39,738)  14,052
Interest expense, net        (6,740)
Other expense, net        (962)
Pretax income        6,350
Provision for income taxes        20,720
Net loss        (14,370)
Net income attributable to non-controlling interests        2,492
Net loss attributable to UTi Worldwide Inc.        $ (16,862)
         
         
UTi Worldwide Inc.        
Segment Reporting        
(in thousands)        
(Unaudited)        
         
  Six months ended July 31, 2012
 
Freight
Forwarding
Contract
Logistics and
Distribution


Corporate


Total
         
Revenues  $ 1,579,297  $ 772,290  $ --   $ 2,351,587
         
Purchased transportation costs  1,216,254  323,495  --   1,539,749
Staff costs  214,034  224,692  17,792  456,518
Depreciation  8,250  13,400  1,075  22,725
Amortization of intangible assets  2,071  3,251  1,080  6,402
Severance and other  2,176  1,109  539  3,824
Other operating expenses  91,025  166,035  8,739  265,799
Total operating expenses  1,533,810  731,982  29,225  2,295,017
Operating income/(loss)  $ 45,487  $ 40,308  $ (29,225)  56,570
Interest expense, net        (5,302)
Other expense, net        (300)
Pretax income        50,968
Provision for income taxes        16,521
Net income        34,447
Net income attributable to non-controlling interests        2,678
Net income attributable to UTi Worldwide Inc.        $ 31,769
 
 
UTi Worldwide Inc.
Geographic Reporting
(in thousands)
(Unaudited)
 
  Three months ended July 31, 2013
 
Freight
Forwarding
Revenues
Contract
Logistics and
Distribution
Revenues

Freight
Forwarding
Net Revenues
Contract
Logistics and
Distribution
Net Revenues


Operating
(Loss)/Income


Severance and
Other
EMENA  $ 215,932  $ 55,598  $ 59,805  $ 32,661  $ (246)  $ 932
Americas  181,118  198,677  48,185  88,131  3,769  652
Asia Pacific  263,749  20,964  51,336  13,708  14,457  604
Africa  108,004  85,376  24,103  67,719  12,703  322
Corporate  --   --   --   --   (20,608)  670
Total  $ 768,803  $ 360,615  $ 183,429  $ 202,219  $ 10,075  $ 3,180
             
             
  Three months ended July 31, 2012
 
Freight
Forwarding
Revenues
Contract
Logistics and
Distribution
Revenues

Freight
Forwarding
Net Revenues
Contract
Logistics and
Distribution
Net Revenues


Operating
Income/(Loss)


Severance and
Other
EMENA  $ 236,506  $ 60,048  $ 61,021  $ 33,524  $ 2,470  $ 1,199
Americas  195,208  205,008  48,648  90,263  9,809  499
Asia Pacific  251,389  18,533  49,197  12,008  13,353  50
Africa   114,272  101,966  27,863  83,547  22,159  44
Corporate  --   --   --   --   (14,761)  332
Total  $ 797,375  $ 385,555  $ 186,729  $ 219,342  $ 33,030  $ 2,124
 
 
UTi Worldwide Inc.
Geographic Reporting
(in thousands)
(Unaudited)
 
  Six months ended July 31, 2013
 
Freight
Forwarding
Revenues
Contract
Logistics and
Distribution
Revenues

Freight
Forwarding
Net Revenues
Contract
Logistics and
Distribution
Net Revenues


Operating
(Loss)/Income


Severance and
Other
EMENA  $ 428,623  $ 109,867  $ 117,023  $ 64,758  $ (3,406)  $ 1,919
Americas  355,539  393,441  92,466  173,865  4,983  893
Asia Pacific  483,268  38,846  95,571  25,481  23,642  604
Africa  220,889  179,598  47,922  144,297  28,571  322
Corporate  --   --   --   --   (39,738)  2,111
Total  $ 1,488,319  $ 721,752  $ 352,982  $ 408,401  $ 14,052  $ 5,849
             
             
  Six months ended July 31, 2012
 
Freight
Forwarding
Revenues
Contract
Logistics and
Distribution
Revenues

Freight
Forwarding
Net Revenues
Contract
Logistics and
Distribution
Net Revenues


Operating
Income/(Loss)


Severance and
Other
EMENA  $ 480,851  $ 123,036  $ 119,185  $ 71,677  $ 1,930  $ 2,229
Americas  381,873  401,731  95,031  178,874  16,269  924
Asia Pacific  484,627  35,508  95,736  23,154  24,158  75
Africa   231,946  212,015  53,091  175,090  43,438  57
Corporate  --   --   --   --   (29,225)  539
Total  $ 1,579,297  $ 772,290  $ 363,043  $ 448,795  $ 56,570  $ 3,824
 
 
UTi Worldwide Inc. 
Supplemental Financial Information – Reconciliation to US GAAP
(in thousands, except per share amounts)
(Unaudited)    
     
  Three months ended
July 31, 2013
Three months ended
July 31, 2012
GAAP Revenues  $ 1,129,418  $ 1,182,930
Less: Purchased transportation costs  (743,770)  (776,859)
Net revenues  $ 385,648  $ 406,071
     
GAAP Operating expenses  $ 1,119,343  $ 1,149,900
Less: Purchased transportation costs  (743,770)  (776,859)
Operating expenses less purchased transportation costs  375,573  373,041
Less: Adjustment for severance and other(1)  (3,180)  (2,124)
Non-GAAP Operating expenses  $ 372,393  $ 370,917
     
GAAP Operating income  $ 10,075  $ 33,030
Add: Adjustment for severance and other(1)  3,180  2,124
Non-GAAP Operating income  $ 13,255  $ 35,154
     
Non-GAAP operating income as a percentage of net revenues 3.4% 8.7%
     
GAAP Pretax income  $ 5,908  $ 30,264
Add: Adjustment for severance and other(1)  3,180  2,124
Non-GAAP Pretax income  $ 9,088  $ 32,388
     
GAAP Provision for income taxes  $ 9,414  $ 10,047
Add: Adjustment for severance and other(2)  808  705
Less: Adjustment for deferred tax asset valuation allowance(3)  (7,540)  (786)
Non-GAAP Provision for income taxes  $ 2,682  $ 9,966
     
GAAP Net (loss)/income attributable to UTi Worldwide Inc.  $ (4,444)  $ 18,883
Adjustment for:    
Severance and other(1)  3,180  2,124
Income tax effect severance and other(2)  (808)  (705)
Adjustment for deferred tax asset valuation allowance(3)  7,540  786
Non-GAAP Net income attributable to UTi Worldwide Inc.  $ 5,468  $ 21,088
     
GAAP Diluted (loss)/earnings per common share  $ (0.04)  $ 0.18
Adjustment for:    
Severance and other(1)  0.03  0.03
Income tax effect severance and other(2)  (0.01)  (0.01)
Adjustment for deferred tax asset valuation allowance(3)  0.07  0.01
Non-GAAP Diluted earnings per common share  $ 0.05  $ 0.21
     
(1)  During the three months ended July 31, 2013 and 2012, the company recorded pre-tax severance of $3,180 and $2,124, respectively, primarily related to transformation activities.
(2) The provisions for income tax adjustment related to the severance and other costs were calculated based on the prevailing tax rate in each jurisdiction.
(3) Adjustments for deferred tax asset valuation allowances include the effects of current period valuation allowances. For the three months ended July 31, 2013, the adjustment also includes an out of period adjustment to income tax expense of $1,098 to increase the valuation allowances for certain of its deferred tax assets. 
 
 
UTi Worldwide Inc. 
Supplemental Financial Information – Reconciliation to US GAAP
(in thousands, except per share amounts)
(Unaudited)
     
  Six months ended
July 31, 2013
Six months ended
July 31, 2012
GAAP Revenues  $ 2,210,071  $ 2,351,587
Less: Purchased transportation costs  (1,448,688)  (1,539,749)
Net revenues  $ 761,383  $ 811,838
     
GAAP Operating expenses  $ 2,196,019  $ 2,295,017
Less: Purchased transportation costs  (1,448,688)  (1,539,749)
Operating expenses less purchased transportation costs  747,331  755,268
Less: Adjustment for severance and other(4)  (5,849)  (3,824)
Non-GAAP Operating expenses  $ 741,482  $ 751,444
     
GAAP Operating income  $ 14,052  $ 56,570
Add: Adjustment for severance and other(4)  5,849  3,824
Non-GAAP Operating income  $ 19,901  $ 60,394
     
Non-GAAP operating income as a percentage of net revenues 2.6% 7.4%
     
GAAP Pretax income  $ 6,350  $ 50,968
Add: Adjustment for severance and other(4)  5,849  3,824
Non-GAAP Pretax income  $ 12,199  $ 54,792
     
GAAP Provision for income taxes  $ 20,720  $ 16,521
Add: Adjustment for severance and other(5)  1,723  1,240
Less: Adjustment for deferred tax asset valuation allowance(6)  (15,848)  (2,082)
Non-GAAP Provision for income taxes  $ 6,595  $ 15,679
     
GAAP Net (loss)/income attributable to UTi Worldwide Inc.  $ (16,862)  $ 31,769
Adjustment for:    
Severance and other(4)  5,849  3,824
Income tax effect severance and other(5)  (1,723)  (1,240)
Adjustment for deferred tax asset valuation allowance(6)  15,848  2,082
Non-GAAP Net income attributable to UTi Worldwide Inc.  $ 3,112  $ 36,435
     
GAAP Diluted (loss)/earnings per common share  $ (0.16)  $ 0.31
Adjustment for:    
Severance and other(4)  0.06  0.03
Income tax effect severance and other(5)  (0.02)  (0.01)
Adjustment for deferred tax asset valuation allowance(6)  0.15  0.02
Non-GAAP Diluted earnings per common share  $ 0.03  $ 0.35
     
(4) During the six months ended July 31, 2013 and 2012, the company recorded pre-tax severance of $5,849 and $3,824, respectively, primarily related to transformation activities.
(5) The provisions for income tax adjustment related to the severance and other costs were calculated based on the prevailing tax rate in each jurisdiction.
(6) Adjustments for deferred tax asset valuation allowances include the effects of current period valuation allowances.   For the six months ended July 31, 2013, the adjustment also includes an out of period adjustment to income tax expense of $6,098 to increase the valuation allowances for certain of its deferred tax assets.
 
 
UTi Worldwide Inc.
Organic Growth Reconciliation
 (Unaudited)
           
  Three months ended July 31, 2013
 
Total Net
Change

+/(-)
Currency Impact


Organic Growth
+/(-)
Non-GAAP
Items

Adjusted
Organic Growth
Revenues  (5)%  3%  (2)%  --%   (2)%
Net revenues  (5)%  3%  (2)%  --%   (2)%
Operating expenses less purchased transportation costs  1%  3%  4%  --%   4%
           
  Six months ended July 31, 2013
 
Total Net
Change

+/(-)
Currency Impact


Organic Growth
+/(-)
Non-GAAP
Items

Adjusted
Organic Growth
Revenues  (6)%  1%  (5)%  --%   (5)%
Net revenues  (7)%  2%  (5)%  --%   (5)%
Operating expenses less purchased transportation costs  (1)%  4%  3%  --%   3%

Set forth above is a reconciliation of the company's organic growth rates and the growth rates based on the company's GAAP reported results in the company's revenues, net revenues and operating expenses less purchased transportation costs for the three and six months ended July 31, 2013. Organic growth is a non-GAAP measure that excludes the impact of foreign currency translation.

CONTACT: Jeff Misakian
         Global Vice President, Investor Relations
         (562) 552-9417
         jmisakian@go2uti.com
UTi Worldwide