International Revenue Stronger Than Expected; UPS Raising Guidance, Expects 2010 EPS To Climb 32-43%
ATLANTA, April 14, 2010 -- UPS (NYSE:UPS) today
pre-announced a 37% increase in adjusted diluted earnings per share for the
first quarter of 2010. The results were powered by a significant acceleration in
the international package and supply chain businesses and improved operating
margins across all three segments.
Adjusted first quarter earnings totaled $0.71 per diluted share compared to
an adjusted $0.52 in the prior-year quarter. On a reported basis, diluted
earnings per share were $0.53 compared to $0.40 for the prior-year period, an
improvement of 33%.
Consolidated revenue for the period grew 7%, driven by increases of 18% in
International Package and 14% in Supply Chain and Freight. International daily
volumes grew significantly with export up more than 9% and non-U.S. domestic up
over 24%. U.S. Domestic daily volume increased less than 1%, the first
year-over-year growth in more than two years.
"We expected the first quarter to be the most challenging of 2010 as the
economic recovery gathered steam through the year," said Kurt Kuehn, UPS's chief
financial officer. "As it turned out, revenue was stronger than we expected due
to international volume gains, increased yields in the U.S. and growth in
Forwarding and Logistics. Also, the operating leverage in our streamlined
network provided higher margins than anticipated."
As a result of the strong
earnings for the first quarter and an improved outlook for the remainder of the
year, UPS has increased its expectations for full- year adjusted diluted
earnings to a range of $3.05 to $3.30 per share, a significant increase over the
$2.70 to $3.05 provided in February.
In the first quarter, UPS
realised charges on two previously announced events. First, UPS recorded a
pre-tax $98 million restructuring charge related to the reorganisation of the
U.S. package segment and second, a pre-tax $38 million loss on the sale of a
specialised transportation business in its supply chain unit in Germany.
Additionally, the company recorded a $76 million non- cash charge to income tax
expense resulting from a change in the tax filing status of a German subsidiary.
These charges reduced net income by $175 million and diluted earnings per share
by $0.18.
UPS took an impairment charge, in the first quarter of 2009, on its
DC-8 fleet resulting in a non-cash expense of $181 million, which reduced net
income by $116 million, or $0.12 per share.
The company will provide additional details of its performance during its
first quarter earnings call on April 27.
UPS (NYSE: UPS) is the world's largest package delivery company and a global
leader in supply chain and freight services. With more than a century of
experience in transportation and logistics, UPS is a leading global trade expert
equipped with a broad portfolio of solutions. Headquartered in Atlanta, USA, UPS
serves more than 200 countries and territories worldwide. The company can be
found on the Web at UPS.com and its corporate blog can be found at www.blog.ups.com. To get UPS news direct,
visit www.pressroom.ups.com.
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