FedEx Reports Lower 2Q Profit

Operating Income at LTL Freight Unit Improves

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FedEx Corp. said Wednesday its second-quarter profit slipped from a year ago due in part to Hurricane Sandy, but operating profit at its less-than-truckload freight unit almost doubled.

Net earnings fell to $438 million, or $1.39 per share, from $497 million, or $1.57, a year ago.

 

Revenue for the quarter ended Nov. 30 rose 5% to $11.1 billion. The earnings were within range of the company’s projected $1.30 to $1.45 per share.

Sandy’s effects cut second-quarter earnings by 11 cents per share, due to reduced shipments and higher operating costs, FedEx said.

LTL unit FedEx Freight’s operating income jumped 90% to $76 million, while revenue rose 4% to $1.33 billion.

FedEx Ground’s operating income rose 4% to $412 million, with revenue up 11% to $2.59 billion.

FedEx Express’ operating income fell 33% to $230 million, while revenue rose 4% to $6.9 billion.

FedEx said it will earn between $1.25 and $1.45 per share in the third quarter and reaffirmed its full fiscal-year forecast of $6.20 to $6.60 per share before charges related to a previously announced voluntary buyout program.

The buyout costs — approximately $550 million to $650 million, or $1.09 to $1.29 per share — will be recognized in the fourth quarter, the company said.

FedEx Corp. is ranked No. 2 on the Transport Topics 100 listing of U.S. and Canadian for-hire carriers.

By Transport Topics

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