UPS Lowers Fourth-Quarter Earnings Guidance

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PS Inc. on Tuesday lowered its fourth-quarter earnings prediction due to a slowing of domestic package volume between Christmas and New Year’s Day and higher-than-anticipated operating costs.

The company said in a statement that earnings excluding a tax benefit would be 75 cents to 76 cents per share, compared with the company's previous expectations of 83 cents to 87cents. Including the tax benefit, earnings will be 81 cents to 82 cents, UPS said.

For the full year, UPS said results would be $2.89 to $2.90 per share, compared with $2.44 a year earlier.

The company said it saw a significant drop in domestic volume during the days between Christmas and New Year's Day. Prior to that week, growth had been trending at 2.5%, UPS said.

It also said the higher operating costs were related to the severe weather that struck the midwestern United States during the height of the holiday season.

Also Tuesday, UPS said it expected earnings to increase 13% to 17% in 2005.

UPS is ranked No. 1 on the Transport Topics 100 list of the largest U.S. and Canadian trucking companies.

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