October 19, 2006 12:30 PM, EDT

UPS’ 3Q Profit, Revenue, Gain on Higher Small-Package Volumes

Click here to write a Letter to the Editor.

PS Inc. said Thursday its third-quarter net income rose 8.9% to $1.04 billion or 96 cents a share, from $953 million or 86 cents a year earlier, aided by a 5% increase in global package volume.

img src="/sites/default/files/images/articles/newups.jpg" width=50 align=right>Revenue rose 10.5% to $11.66 billion, compared with $10.55 billion a year ago, UPS said in a statement.

Domestic package revenue rose 5.2% to $7.4 billion, while international package revenue increased 17.4% to $2.25 billion.

Revenue at UPS’ supply chain and freight segment gained 25.6% to $2 billion, though the unit posted a $19 million loss in the quarter.

During the quarter, UPS announced it would eliminate redundancies at its supply chain unit. The parcel carrier confirmed the cuts on Thursday, saying it would eliminate 20% of the unit’s non-operating expenses. (Click here for previous coverage.)

Scott Davis, chief financial officer for UPS, said the company expects its per-share earnings to increase 11% for 2006. Davis also anticipates strong small-package volumes in the fourth quarter and a “solid” U.S. holiday shipping period.

UPS is ranked No. 1 on the 2006 Transport Topics 100 listing of the largest U.S. and Canadian for-hire carriers.