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FEDERAL EXPRESS CORPORATION REPORTS FIRST QUARTER FISCAL 1994 FINANCIAL RESULTS

 MEMPHIS, Tenn., Sept. 14 /PRNewswire/ -- Federal Express Corporation (NYSE: FDX) today announced that net income for the quarter ended Aug. 31 rose from $10.1 million to $32.9 million, and earnings per share increased from $0.19 to $0.60, excluding a one-time accounting charge from last year's results.
 Revenues for the quarter increased 8 percent year-over-year from $1,864.9 million to $2,015.7 million. Operating income was up 46 percent from $69.7 million to $101.9 million, and pretax income rose from $20.2 million to $60.8 million.
 The company also reported an international operating loss of $33.2 million on international segment revenues of $535.3 million, compared to last year's first quarter operating loss of $57.4 million on revenues of $523.0 million.
 The company had reported a net loss of $45.8 million or $0.84 per share for last year's first quarter, including a one-time accounting charge of $55.9 million after-tax or $1.03 per share. The one-time charge was a cumulative adjustment to earnings related to the adoption of an accounting standard that requires the recording of expected postretirement health care costs.
 Chairman and Chief Executive Officer Frederick W. Smith commented, "This quarter's results showed year-over-year improvement in both our U.S. domestic and international markets. Our 17 percent growth in International Priority revenues was a major factor in once again reducing our international loss. With the yield per pound in the non- time-definite airfreight market continuing to fall at a 13 percent rate, year-over-year, our focus on growing the IP business remains critically important."
 "Steady U.S. domestic volume growth of 11 percent also contributed to the improved quarter," said Chief Financial Officer Alan B. Graf, Jr. "Even more significant for our domestic performance was our ability to slow the yield decline while holding our cost per package essentially flat. Our yield dropped less than 1 percent or $0.11 per package year- over-year compared to a 10 percent or $1.51 per package decline in the first quarter of last year.
 "Although healthy volume growth of almost 11 percent in our more profitable, next-morning packages contributed to our ability to slow the yield deterioration, pricing pressures remain very intense," Graf continued.
 "Obviously, our year-over-year performance improvement is encouraging. However, because last year's first quarter results were disappointing, the year-over-year comparisons for the rest of this fiscal year may not be as dramatic as in this quarter. Improved financial results depend upon sustained IP revenue growth and U.S. domestic yield declines being balanced with reductions in unit costs."
 First quarter financial comparisons, excluding the cumulative charge related to the accounting change in fiscal 1993, are shown in the table below:
 FEDERAL EXPRESS CORPORATION
 In Millions, Except Per Share Data
 Quarter 1 - FY 1994 Quarter 1 - FY 1993
 (excluding cumulative
 effect of
 accounting change)
 Revenues $ 2,015.7 $ 1,864.9
 Operating income 101.9 69.7
 Pretax income 60.8 20.2
 Net income 32.9 10.1
 Earnings per share $ 0.60 $ 0.19
 Effective tax rate 46.0 pct. 49.8 pct.
 Operating income (loss)
 by Business Segment:
 U.S. Domestic $ 135.1 $ 127.2
 International ($ 33.2) ($ 57.4)
 FEDERAL EXPRESS CORPORATION
 Financial Highlights
 First Quarter Fiscal 1994
 (In thousands, except earnings per share and operating data)
 Three Months Ended August 31, 1993 1992
 Financial Results (A):
 Revenues $ 2,015,725 $ 1,864,936
 Operating income 101,907 69,724
 Pretax income (loss) 60,835 20,216
 Provision (benefit) for income taxes 27,984 10,068
 Income (loss) before cumulative effect
 of change in accounting principle 32,851 10,148
 Cumulative effect of change in accounting
 for postretirement benefits, net of tax -- (55,943)
 Net income (loss) $ 32,851 ($ 45,795)
 Earnings (loss) per share:
 Before cumulative effect of change in
 accounting principle $ 0.60 $ 0.19
 Cumulative effect of change in accounting
 principle -- (1.03)
 Earnings (loss) per share $ 0.60 ($ 0.84)
 Common and common equivalent shares 55,186 54,277
 Operating Data:
 Operating Weekdays 65 65
 U.S. Domestic Packages (000) 105,177 94,335
 International Packages (000) 7,921 7,042
 Total Package Volume (000) 113,098 101,377
 Avg. revenue per U.S. Domestic Package $ 13.60 $ 13.71
 Avg. revenue per International Package $ 38.19 $ 36.78
 Average revenue per package $ 15.33 $ 15.31
 Average revenue per pound $ 2.64 $ 2.69
 Average pounds per package 5.8 5.7
 International air freight lbs. (millions) 115.5 134.9
 Average revenue per freight pound $ 1.04 $ 1.14
 (A) As previously reported, fiscal year 1993 first quarter results were restated for the adoption of an accounting standard (SFAS 106) that requires the reporting of expense related to future postretirement health care benefits and include a $3.8 million reduction in operating expense ($0.04 per share after tax) and a cumulative transition adjustment of $55.9 million, net of tax ($1.03 per share).
 -0- 9/14/93
 /CONTACT: Tom Martin, 901-395-3490, or Brandon Davis, 901-395-3755, of Federal Express Corporation/
 (FDX)


CO: Federal Express Corporation ST: Tennessee IN: TRN SU: ERN

LD -- NY095 -- 2019 09/14/93 20:57 EDT
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Date:Sep 14, 1993
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