FedEx Reports 3Q Results
FedEx reported earnings of $1.03 per diluted share for the third quarter ended February 28, compared to $0.68 per diluted share a year ago, a year-over-year increase of 51%.
“We have solid momentum in the business and customer demand is strong,” said Frederick W. Smith, chairman, president and chief executive officer. “Economic conditions remain favorable, and we are optimistic about future growth prospects. We are executing our plans very well and our unique business strategy is paying off.”
Total average daily package volume at FedEx Express and FedEx Ground combined grew more than 10% year over year for the quarter, led by double-digit growth in ground and FedEx International Priority shipments. FedEx Freight average daily less-than-truckload (LTL) shipment volume increased 9%. FedEx Express, FedEx Ground and FedEx Freight each reported solid yield improvement.
Third quarter revenues included $499 million from FedEx Kinko’s, which was acquired in February 2004, compared to approximately $100 million in revenue last year. Last year’s third quarter included $14 million, or $0.03 per diluted share, of business realignment expenses associated with voluntary early retirement and severance programs.
During the quarter, operating income benefited from the timing of adjustments to the company’s indexed fuel surcharges, as fuel costs declined from second quarter levels. However, should the recent trend of fuel cost increases continue, fourth quarter margins could be negatively impacted.
FedEx ranked in the “Top 10” of FORTUNE magazine’s most recent “America’s Most Admired Companies” and “World’s Most Admired Companies” lists. The company also ranked first in the “Delivery” industry in the FORTUNE survey. FedEx continues to place in the FORTUNE “100 Best Companies to Work For” list and has the largest employee base on that list.
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