FedEx Q4 Profit Up, Looks At Cost Cuts

 

FedEx Q4 Profit Up, Looks At Cost Cuts

FedEx Q4 Profit Up, Looks At Cost Cuts

FedEx reported an above-forecast adjusted quarterly profit and forecast higher fiscal 2013 results, as it expected to take new cost-cutting measures to offset shipments weakened by soft global economies.

The company said on Tuesday that net profit for its fiscal fourth quarter ended May 31 was USD$550 million, down from USD$558 million a year earlier.

Revenue rose 4 percent to USD$11.0 billion.

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

FedEx in March cut its outlook based on expectations for below-trend global growth and a mild euro zone recession.

In its largest segment, FedEx Express, US domestic revenue per package rose 6 percent in the fourth quarter due to higher rates per pound, fuel surcharges and growth of premium services, even as volume declined 5 percent.

International priority revenue per package rose 3 percent while average daily volume declined 3 percent driven by year-on-year declines from Asia.

Memphis, Tennessee-based FedEx is undergoing a fleet upgrade to improve fuel efficiency, announcing in December that it was buying new aircraft from Boeing to replace some older planes and delaying delivery of others to cut expenses.

On June 4, FedEx said it was accelerating its aircraft retirement schedule, and taking a related net charge of USD$84 million in the fourth quarter.

(Reuters)



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