FedEx Corp. Increases Earnings Outlook
Better-Than-Expected Growth in Express and Ground Volumes Drives Revenue and Earnings Improvements
FedEx Corporation today announced that it expects earnings to be in the range of $1.05 to $1.25 per diluted share for the first quarter ending August 31, up 81% to 116% from $0.58 per diluted share a year ago. The company's previous guidance for the quarter was $0.85 to $1.05 per diluted share.
For the full year, FedEx expects earnings per diluted share of $4.60 to $5.20, up from $4.40 to $5.00, which reflects the current market outlook for fuel prices and a continued moderate recovery in the global economy. The company reported earnings of $3.76 per diluted share last year.
"Our revenue and earnings growth are exceeding original expectations, primarily due to better-than-expected growth in FedEx Express and FedEx Ground volumes," said Alan B. Graf Jr., FedEx Corp. executive vice president and chief financial officer. "Our package volume growth rates in our first quarter are continuing at a pace similar to our fourth quarter." Of particular benefit to our earnings is the continued strong demand for our higher-margin FedEx International Priority (IP) package and freight services, with IP package volumes expected to grow more than 20% again this quarter. Customers are favorably responding to our superior service offerings, the capabilities of our unparalleled global network and the best-in-market cut-off times we now offer from numerous points in Asia."
With the improved outlook, FedEx is also planning to fully restore the company match for 401(k) plans at all FedEx companies effective January 1, 2011. The cost of this restoration is included in the company's earnings outlook.
FedEx will release the details of its first quarter results on September 16, 2010.