FedEx’s fiscal fourth-quarter profit more than doubled from a year ago, boosted by higher volumes and signaling a strong rebound after a harsh winter hurt results earlier this year.
The results easily exceeded Wall Street’s expectations. Last year’s results were dragged lower by several charges.
FedEx (FDX) and rival United Parcel Services (UPS) each were stung by an unusually severe winter earlier this year, which decreased shipping volume and led to increased costs. For FedEx, those disruptions trimmed operating income by an estimated $125 million in the fiscal third quarter. The results FedEx’s reported Wednesday were amid more normalized conditions.
Meanwhile, FedEx and UPS earlier this year each raised some of their shipping rates. Those increases come as the industry faces some challenges, particularly a shift toward lower-pricing shipping services among international clients.
For the period ended May 31, FedEx reported a profit of $730 million, or $2.46 a share, up from $303 million, or 95 cents a share, a year ago. Excluding restructuring and impairments charges, prior-year adjusted profit totaled $2.13 a share.
Total revenue jumped 3.5% to $11.84 billion, boosted by strong growth from the freight and ground segments. Analysts surveyed by Bloomberg had projected an adjusted profit of $2.36 a share on $11.66 billion in revenue.
Total U.S. package volume climbed 3%, while volumes also grew across all international businesses.
Looking ahead, FedEx sees full-year profit for the new fiscal year between $8.50 to $9 a share. Analysts had expected $8.76 a share.
