Trucking news and briefs for Wednesday, March 2, 2022:
In an 8-K filing to the U.S. Securities and Exchange Commission Monday, Landstar System (CCJ Top 250, No. 9) projects it could lose $100 million in the first quarter of fiscal year 2022 if two independent commission sales agencies it works with in Ukraine shut down due to the Russian invasion of the eastern European nation. Landstar said its priority, though, is the safety of the workforces in Ukraine.
"The priority for Landstar and both of these agencies is the safety and well-being of these agencies’ Ukrainian workforces and their families," the company said in the filing.
According to the filing, one of the agencies is located in eastern Ukraine, and the other is in western Ukraine. The agency operating in eastern Ukraine is the largest Landstar independent commission sales agency, the company says. The western Ukraine agency is another of the company’s largest.
Combined, the two agencies generated approximately $860 million, or 13%, of Landstar’s consolidated revenue in fiscal year 2021, the company notes.
Landstar estimated that the complete disruption of both Ukrainian-based agencies would have an adverse impact of $20 to $25 million per week in its truckload revenue. With four weeks remaining in the quarter, Landstar projects a potential $100 million revenue hit if the agencies’ operations are disrupted.
Landstar noted, however, that even if there is a complete disruption of the two Ukrainian agencies, the company still anticipates that revenue for the first quarter would exceed the high end of the range of $1.70 billion to $1.75 billion that it estimated in January.
