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FedEx raises full year profit outlook after quarterly growth

Published: 13:06 20 Dec 2017 GMT

Fedex
FedEx delivered strong package volumes in the second quarter

Postal operator FedEx Corp (NYSE:FDX) raised its full year guidance after achieving an increase in second quarter net profit on the back of strong package delivery volumes.  

Net income rose to US$775mln, or US$2.84 per share, in the second quarter from US$700mln, or US$2.59 per share, a year ago.

READ: FedEx expects to see record number of shipments over holiday season

Adjusted for one-off items, FedEx reported earnings per share of US$3.18, beating analysts’ expectations of US$2.89.

However, the company said cyber-attack on its TNT Express business in June cut US$100mln from quarterly profit.

FedEx also raised its predicted costs of integrating TNT Express, which it bought last year for US$4.8bn, through fiscal 2020 to about US$1.4bn from a previous estimate of US$800mln.

Still chief executive Fred Smith said the company was on track for another record holiday shipping season in late November through the New Year.

FedEx lifted its full-year profit outlook to US$12.70 to US$13.30 a share, compared with market forecasts of US$12.47.

If US President Donald Trump’s tax cuts and jobs act is enacted before the results, earnings per share could increase by an estimated US$4.40 to US$5.50 per diluted share for fiscal 2018, primarily due to the revaluation of net deferred tax liabilities 

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