FedEx Q4 Results Top View

(RTTNews) - Package delivery giant FedEx Corp. (FDX) Wednesday reported higher fourth-quarter profit, adding that it is well positioned for a strong fiscal 2015. Both earnings and revenues topped Wall Street estimates. The stock is up close to 4 percent in pre-market trading.

According to FedEx, excluding business realignment program costs and aircraft impairment charges last year, operating results improved on higher volumes and operational efficiencies at FedEx Freight, increased volumes and yields at FedEx Ground, and better revenue and cost performance at FedEx Express.

Net income for the quarter increased to $730 million from $303 million in the previous year. Earnings per share climbed to $2.46 from $0.95. Excluding a $0.98 per share business realignment program charge and a $0.20 per share non-cash aircraft impairment charge at FedEx Express, adjusted earnings per share totaled $2.13 last year.

On average, 24 analysts polled by Thomson Reuters expected earnings per share of $2.36 for the quarter. Analysts' estimates typically exclude one-time items.

Share repurchases benefited fourth-quarter earnings by $0.12 per share.

Revenue improved to $11.839 billion from $11.435 billion generated last year. Analysts estimated revenues of $11.66 billion for the quarter.

FedEx Express segment reported a marginal revenue growth at $7.00 billion, compared to last year's $6.98 billion, amid higher package volume and higher base package yields, partially offset by the effects of one fewer operating day, lower fuel surcharges and lower express freight revenues.

Within the segment, U.S. domestic average daily volume increased 3 percent, while U.S. domestic revenue per package was flat as lower fuel surcharges offset higher weight per package and favorable service mix. International export revenue per package grew 2 percent, helped by improved rates, higher weight per package and favorable service mix.

FedEx Ground Segment revenues grew 8 percent to $3.01 billion, and average daily volume rose 8 percent, primarily driven by growth in e-commerce.

In FedEx Freight Segment, revenue climbed 12 percent to $1.55 billion. Less-than-truckload average daily shipments grew 12 percent, including a 14 percent increase in demand for Priority service.

Frederick Smith, FedEx Corp. chairman, president and chief executive officer, said, "An outstanding fourth quarter helped FedEx post solid results for fiscal 2014, and we believe we are well positioned for a strong fiscal 2015."

For fiscal 2015, FedEx projects earnings to be $8.50 to $9.00 per share, assuming no net year-over-year fuel impact and continued moderate economic growth. Analysts project earnings of $8.76 a share for the year.

The company expects results in fiscal 2015 to benefit from base performance improvement and execution of profit improvement initiatives at FedEx Express, continued profitable growth at FedEx Ground and FedEx Freight, and its share repurchase program.

FDX, which closed up 0.8 percent at $140.31 on Tuesday, is gaining 3.8 percent in pre-market activity.