FedEx Announces Yet Another Improving Quarter Result

During the second quarter the world’s 2nd biggest packaged delivery firm reported yet another consecutive income growth by 76% as compared to its last year quarter result. The main reasons for this robust growth were better price/volume mix as well as solid Thanksgiving weekend online sales.

Earnings rose by 76% to $497 million year-on-year. Earning per share was $1.57 against market expectation of $1.53. Operational margins rose to 7.4%, from 4.9% previous year.

Overall sales increased by 10%. Even though volume of international priority daily package was lower because of weaker Asian market, the company succeeded in getting increased international priority revenues for each package because of higher rate for each pound, higher fuel surcharges as well as higher weight for every package.

Demand for residential delivery services jumped due to a rise in online shopping in the Thanksgiving weekend. Reports that Amazon is expected to enjoy a fantastic holiday season are definitely good for shipping firms such as FedEx. In spite of weak Asian market, the company has begun its biggest facility in mainland China which is seen as a key market. Rival company United Parcel Service is also expanding its operations in Asian market.

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Leo Pierson

About Leo Pierson

Former partner in a real estate management firm, Leo, has been active in the market for the last 8 years. Ex-blogger on penny stocks, now focused on long term growth stocks, Leo provides valuable market snapshots each day as part of our editorial team.

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