FedEx tops its profit forecast

 
City A.M. Reporter
FEDEX reported above-forecast adjusted quarterly profit yesterday and forecast higher 2013 results, as it said it expected to take new cost-cutting measures to offset shipments weakened by soft global economies.

The world’s second-largest package delivery company said that net profit for its fourth quarter ended 31 May was $550m (£350m), or $1.73 per share, down from $558m, or $1.75 per share, a year earlier.

But adjusted profit before items was $1.99 per share, up from $1.75 a year before, and revenue rose four per cent to reach $11bn.

FedEx said it faces cost increases in 2013, including higher pension expenses and depreciation costs.

It also said it sees profit per share of $1.45 to $1.60 in the first quarter and $6.90 to $7.40 in 2013.

The outlook “does not include the impacts of the significant cost reductions programs currently under review that should be announced in the fall,” the company said in a statement.

In its largest segment, FedEx Express, US domestic revenue per package rose six per cent in the fourth quarter due to higher rates per pound, fuel surcharges and growth of premium services, even as volume declined five per cent.