Huge Quarter for FedEx
Fourth-quarter earnings rose 27% from a year ago at FedEx (FDX), as both sales and margins improved amid growth in ground and international volume.
FedEx earned $568 million, or $1.82 a share, in the quarter, compared with earnings of $448 million, or $1.46 a share, a year ago. Analysts surveyed by Thomson First Call had been forecasting earnings of $1.77 a share in the most recent quarter.
Revenue rose 10% in the fourth quarter to $8.49 billion; analysts were predicting $8.42 billion. The company said its operating income rose 25% to $927 million and operating margins were 10.9% in the fourth quarter, up from 9.6% a year ago.
"FedEx posted record financial results in the fourth quarter and full year, as we ended our fiscal 2006 in an environment of solid economic growth in the U.S. and in international markets," it said. "We remain optimistic about the global economic environment for fiscal 2007 and our ability to effectively manage our business. We will remain firmly focused on making every customer experience outstanding, profitably growing our business and seeking new opportunities to serve our customers."The company's biggest segment by far, FedEx Express, saw revenue rise 10% to $5.61 billion and operating margin widen to 10% from 8.4%. Margin was driven by revenue growth, yield management and cost controls, the company said. For the current first quarter, FedEx expects to earn $1.45 to $1.60 a share; analysts were forecasting $1.43 a share. For the current year, FedEx expects to earn $6.45 to $6.80 a share; analysts were forecasting $6.73 a share. "The company expects continued growth in FedEx International Priority, U.S. domestic overnight express box, FedEx Ground and FedEx Freight shipments and improving operating margins in the transportation segments," it said in a release.
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