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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): June 23, 2022

 

FedEx Corporation

(Exact name of registrant as specified in its charter)

 

Commission File Number 1-15829

 

Delaware

 

62-1721435

(State or other jurisdiction of

 

(IRS Employer

incorporation)

 

Identification No.)

 

 

 

942 South Shady Grove Road, Memphis, Tennessee

 

38120

(Address of principal executive offices)

 

(ZIP Code)

 

Registrant’s telephone number, including area code: (901) 818-7500

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol

 

Name of each exchange

on which registered

Common Stock, par value $0.10 per share

 

FDX

 

New York Stock Exchange

0.450% Notes due 2025

 

FDX 25A

 

New York Stock Exchange

1.625% Notes due 2027

 

FDX 27

 

New York Stock Exchange

0.450% Notes due 2029

 

FDX 29A

 

New York Stock Exchange

1.300% Notes due 2031

 

FDX 31

 

New York Stock Exchange

0.950% Notes due 2033

 

FDX 33

 

New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

 

 


 

EXPLANATORY NOTE

The information in this Report, including Exhibit 99.1, is being furnished pursuant to Item 2.02 of Form 8-K and General Instruction B.2 thereunder. Such information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

SECTION 2. FINANCIAL INFORMATION.

Item 2.02. Results of Operations and Financial Condition.

Attached as Exhibit 99.1 and incorporated herein by reference is a copy of FedEx Corporation’s press release, dated June 23, 2022, announcing its financial results for the fiscal quarter and year ended May 31, 2022.

 

SECTION 9. FINANCIAL STATEMENTS AND EXHIBITS.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit

Number

 

Description

 

 

 

99.1

 

Press Release of FedEx Corporation dated June 23, 2022.

 

 

 

104

 

Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document).

 

 

 

 

 

 

 

 

 


 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

FedEx Corporation

 

 

 

Date: June 23, 2022

 

By:

 

/s/ Jennifer L. Johnson

 

 

 

 

Jennifer L. Johnson

 

 

 

 

Corporate Vice President and

 

 

 

 

Principal Accounting Officer

 

 

 


 

EXHIBIT INDEX

 

Exhibit

Number

 

Description

 

 

 

99.1

 

Press Release of FedEx Corporation dated June 23, 2022.

 

 

 

104

 

Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document).

 

 

 


EX-99.1 2 fdx-ex99_1.htm EX-99.1 EX-99.1

 

Exhibit 99.1

 

 

 

FedEx Corp. Reports Fourth Quarter and Full-Year Results

Additional Earnings Momentum Expected During Fiscal 2023

 

MEMPHIS, Tenn., June 23, 2022 ... FedEx Corp. (NYSE: FDX) today reported the following consolidated results for the quarter ended May 31 (adjusted measures exclude the items listed below for the applicable fiscal year):

 

 

 

Fiscal 2022

 

Fiscal 2021

 

 

As Reported
(GAAP)

 

Adjusted
(non-GAAP)

 

As Reported
(GAAP)

 

Adjusted
(non-GAAP)

Revenue

 

$24.4 billion

 

$24.4 billion

 

$22.6 billion

 

$22.6 billion

Operating income

 

$1.92 billion

 

$2.23 billion

 

$1.80 billion

 

$1.97 billion

Operating margin

 

7.9%

 

9.2%

 

8.0%

 

8.7%

Net income

 

$558 million

 

$1.80 billion

 

$1.87 billion

 

$1.36 billion

Diluted EPS

 

$2.13

 

$6.87

 

$6.88

 

$5.01

 

This year’s and last year’s quarterly and full-year consolidated results have been adjusted for:

 

 

 

Fiscal 2022

 

Fiscal 2021

Impact per diluted share

 

Fourth
Quarter

 

Full
Year

 

Fourth
Quarter

 

Full
Year

Mark-to-market (MTM) retirement
    plans accounting adjustments

 

$3.83

 

$4.49

 

($3.44)

 

($3.33)

FedEx Ground legal matter

 

0.61

 

0.60

 

 

Business realignment costs

 

0.18

 

0.80

 

0.30

 

0.33

TNT Express integration expenses

 

0.12

 

0.39

 

0.18

 

0.60

Loss on debt extinguishment

 

 

 

1.09

 

1.11

 

“Our fiscal 2022 financial performance was a result of our team's ability to adapt to a number of unexpected challenges and is a testament to the FedEx value proposition and the execution of our long-term strategy,” said Raj Subramaniam, FedEx Corp. president and chief executive officer. “Our foundational investments have set the stage for a strong fiscal 2023. As we move forward, our focus will be on revenue quality and lowering our cost to serve. I am honored to lead our dedicated global team, who enable FedEx to lead the industry from a position of strength.”

 

Fourth Quarter Results

 

Fourth quarter operating income improved primarily due to revenue management actions, including the favorable net impact of fuel at each transportation segment, and lower variable compensation expense. These factors were partially offset by lower shipment demand due to slower economic growth and supply chain disruptions, as well as higher purchased transportation and wage rates.

1


 

 

Fourth quarter net income included a tax benefit of $46 million ($0.18 per diluted share) related to revisions of prior year estimates for actual tax return results.

 

FedEx Express operating results improved in the fourth quarter driven by revenue management actions, including increased fuel surcharges. Global volume softness, driven by COVID lockdowns, geopolitical uncertainty, and slower economic growth, partially offset the year-over-year improvement.

 

FedEx Ground operating results declined primarily due to higher self-insurance accruals and increased purchased transportation and wage rates. These costs were partially offset by higher revenue per package, including increased fuel surcharges. Average daily volume declined primarily due to yield management actions affecting the FedEx Ground Economy service.

 

FedEx Freight operating results sharply increased, with operating margin improving 570 basis points to 21.8%. The improved results were driven by a 28% increase in revenue per shipment from the continued focus on revenue quality and profitable growth.

 

Full-Year Results

 

For the full fiscal year, FedEx Corp. reported the following consolidated results (adjusted measures exclude the items listed above for the applicable fiscal year):

 

 

 

Fiscal 2022

 

Fiscal 2021

 

 

As Reported
(GAAP)

 

Adjusted
(non-GAAP)

 

As Reported
(GAAP)

 

Adjusted
(non-GAAP)

Revenue

 

$93.5 billion

 

$93.5 billion

 

$84.0 billion

 

$84.0 billion

Operating income

 

$6.25 billion

 

$6.87 billion

 

$5.86 billion

 

$6.18 billion

Operating margin

 

6.7%

 

7.3%

 

7.0%

 

7.4%

Net income

 

$3.83 billion

 

$5.50 billion

 

$5.23 billion

 

$4.89 billion

Diluted EPS

 

$14.33

 

$20.61

 

$19.45

 

$18.17

 

Capital spending for fiscal 2022 was $6.8 billion.

 

Share Repurchases

 

During fiscal 2022 the company repurchased $2.2 billion of FedEx common stock. As of May 31, 2022, $4.1 billion remained under the existing share repurchase authorization. The company expects to repurchase $1.5 billion of FedEx common stock during the first half of fiscal 2023.

 

2


 

Outlook

 

FedEx is unable to forecast the fiscal 2023 mark-to-market (MTM) retirement plans accounting adjustments. FedEx also may incur additional costs in fiscal 2023 related to business optimization initiatives. The company is currently unable to forecast the amount and timing of these additional costs, which may impact the fiscal 2023 effective tax rate (ETR). As a result, FedEx is unable to provide a fiscal 2023 earnings per share or ETR outlook on a GAAP basis.

 

For fiscal 2023, FedEx is forecasting:

 

Earnings per diluted share of $22.45 to $24.45 before the MTM retirement plans accounting adjustments and costs related to business optimization initiatives;
Earnings per diluted share of $22.50 to $24.50 before the MTM retirement plans accounting adjustments and costs related to business optimization initiatives, and excluding estimated costs associated with business realignment activities;
ETR of approximately 24% prior to the MTM retirement plans accounting adjustments and costs related to business optimization initiatives; and
Capital spending of $6.8 billion, with a priority on investments to improve efficiency, including fleet and facility modernization, and increased automation.

 

These forecasts assume the company's current economic forecast and fuel price expectations, no additional COVID-19-related business restrictions, successful completion of the planned stock repurchases, and no additional adverse geopolitical developments. FedEx’s ETR and earnings per share forecasts are based on current law and related regulations and guidance.

 

“Our continued emphasis on revenue quality drove significant improvement in our fourth quarter results,” said Michael C. Lenz, FedEx Corp. executive vice president and chief financial officer. “We expect further momentum in fiscal 2023 and beyond as we execute on our initiatives to drive increased profitability and returns.”

 

Investors Meeting

 

On June 29, 2022, the FedEx executive team will discuss its strategy and plans for the future. These plans will guide the company’s short-term and long-term priorities for maximizing value for customers, stockholders, and team members. The meeting will be streamed beginning at 8:30 a.m. CDT at investors.fedex.com, and the materials presented will be available to download.

 

Corporate Overview

 

FedEx Corp. (NYSE: FDX) provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services. With annual revenue of $94 billion, the company offers integrated business solutions through operating companies competing collectively, operating collaboratively and innovating digitally under the respected FedEx brand.

3


 

Consistently ranked among the world's most admired and trusted employers, FedEx inspires its 550,000 employees to remain focused on safety, the highest ethical and professional standards and the needs of their customers and communities. FedEx is committed to connecting people and possibilities around the world responsibly and resourcefully, with a goal to achieve carbon-neutral operations by 2040. To learn more, please visit fedex.com/about.

 

Additional information and operating data are contained in the company’s annual report, Form 10-K, Form 10-Qs, Form 8-Ks and Statistical Books. These materials, as well as a webcast of the earnings release conference call to be held at 5:00 p.m.

EDT on June 23, are available on the company’s website at investors.fedex.com. A replay of the conference call webcast will be posted on our website following the call.

 

The Investor Relations page of our website, investors.fedex.com, contains a significant amount of information about FedEx, including our Securities and Exchange Commission (SEC) filings and financial and other information for investors. The information that we post on our Investor Relations website could be deemed to be material information. We encourage investors, the media and others interested in the company to visit this website from time to time, as information is updated and new information is posted.

 

Certain statements in this press release may be considered forward-looking statements, such as statements relating to management’s views with respect to future events and financial performance and underlying assumptions. Forward-looking statements include those preceded by, followed by or that include the words “will,” “may,” “could,” “would,” “should,” “believes,” “expects,” “forecasts,” “anticipates,” “plans,” “estimates,” “targets,” “projects,” “intends” or similar expressions. Such forward-looking statements are subject to risks, uncertainties and other factors which could cause actual results to differ materially from historical experience or from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, economic conditions in the global markets in which we operate; our ability to meet our labor and purchased transportation needs while controlling related costs; a significant data breach or other disruption to our technology infrastructure; the continuing effect of the COVID-19 pandemic; anti-trade measures and additional changes in international trade policies and relations; the effect of any international conflicts or terrorist activities, including as a result of the current conflict between Russia and Ukraine; our ability to successfully implement our business strategy, effectively respond to changes in market dynamics, and achieve the anticipated benefits and associated cost savings of such strategies and actions, including our ability to successfully implement our FedEx Express workforce reduction plan in Europe and to continue to transform and optimize the FedEx Express international business, particularly in Europe; damage to our reputation or loss of brand equity; changes in the business or financial soundness of the U.S.

4


 

Postal Service, including strategic changes to its operations to reduce its reliance on the air network of FedEx Express; changes in fuel prices or currency exchange rates, including significant increases in fuel prices as a result of the ongoing conflict between Russia and Ukraine; our ability to match capacity to shifting volume levels; the effect of intense competition; an increase in self-insurance accruals and expenses; our ability to effectively operate, integrate, leverage, and grow acquired businesses and realize the anticipated benefits of acquisitions and other strategic transactions; the future rate of e-commerce growth and our ability to successfully expand our e-commerce services portfolio; the timeline for recovery of passenger airline cargo capacity; evolving or new U.S. domestic or international laws and government regulations, policies, and actions; future guidance, regulations, interpretations, challenges, or judicial decisions related to our tax positions; legal challenges or changes related to service providers engaged by FedEx Ground and the drivers providing services on their behalf; our ability to quickly and effectively restore operations following adverse weather or a localized disaster or disturbance in a key geography; our ability to achieve our goal of carbon-neutral operations by 2040; and other factors which can be found in FedEx Corp.’s and its subsidiaries’ press releases and FedEx Corp.’s filings with the SEC. Any forward-looking statement speaks only as of the date on which it is made. We do not undertake or assume any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

 

Media Contact: Jenny Robertson 901-434-4829

Investor Contact: Mickey Foster 901-818-7468

 

 

5


 

RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES

TO GAAP FINANCIAL MEASURES

 

 

Fourth Quarter and Full-Year Fiscal 2022 and Fiscal 2021 Results

 

The company reports its financial results in accordance with accounting principles generally accepted in the United States (“GAAP” or “reported”). We have supplemented the reporting of our financial information determined in accordance with GAAP with certain non-GAAP (or “adjusted”) financial measures, including our adjusted fourth quarter and adjusted full-year fiscal 2022 and 2021 consolidated operating income and margin, net income and diluted earnings per share, and adjusted fourth quarter and adjusted full-year fiscal 2022 and 2021 FedEx Express segment operating income and margin. These financial measures have been adjusted to exclude the impact of the following items (as applicable):

 

MTM retirement plans accounting adjustments in fiscal 2022 and 2021;
Business realignment costs in fiscal 2022 and 2021;
Costs related to a FedEx Ground legal matter in fiscal 2022;
TNT Express integration expenses incurred in fiscal 2022 and 2021; and
Loss on debt extinguishment in fiscal 2021.

 

The MTM retirement plans accounting adjustments, costs related to business realignment activities in connection with the FedEx Express workforce reduction plan in Europe, costs related to a FedEx Ground legal matter, and loss on debt extinguishment are excluded from our fourth quarter and full-year fiscal 2022 and 2021 consolidated and FedEx Express segment non-GAAP financial measures, as applicable, because they are unrelated to our core operating performance and/or to assist investors with assessing trends in our underlying businesses. The charges related to accrued pre- and post-judgment interest incurred in connection with the FedEx Ground legal matter are extraordinary in nature and do not represent a recurring expense arising in our ordinary course of business.

 

We have incurred significant expenses through fiscal 2022 in connection with our integration of TNT Express. We have adjusted our fourth quarter and full-year fiscal 2022 and 2021 consolidated and FedEx Express segment financial measures to exclude TNT Express integration expenses because we generally would not incur such expenses as part of our continuing operations. The integration expenses are predominantly incremental costs directly associated with the integration of TNT Express, including professional and legal fees, salaries and employee benefits, advertising and travel expenses. Internal salaries and employee benefits are included only to the extent the individuals are assigned full-time to integration activities. The integration expenses do not include costs associated with our business realignment activities.

 

6


 

We believe these adjusted financial measures facilitate analysis and comparisons of our ongoing business operations because they exclude items that may not be indicative of, or are unrelated to, the company’s and our business segments’ core operating performance, and may assist investors with comparisons to prior periods and assessing trends in our underlying businesses. These adjustments are consistent with how management views our businesses. Management uses these non-GAAP financial measures in making financial, operating and planning decisions and evaluating the company’s and each business segment’s ongoing performance.

 

Our non-GAAP financial measures are intended to supplement and should be read together with, and are not an alternative or substitute for, and should not be considered superior to, our reported financial results. Accordingly, users of our financial statements should not place undue reliance on these non-GAAP financial measures. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names. As required by SEC rules, the tables below present a reconciliation of our presented non-GAAP financial measures to the most directly comparable GAAP measures.

 

Fiscal 2023 Earnings Per Share and Effective Tax Rate Forecasts

 

Our fiscal 2023 earnings per share (EPS) forecast is a non-GAAP financial measure because it excludes (i) fiscal 2023 MTM retirement plans accounting adjustments, (ii) costs related to business optimization initiatives in fiscal 2023, and (iii) estimated fiscal 2023 business realignment costs. Our fiscal 2023 effective tax rate (ETR) forecast is a non-GAAP financial measure because it excludes the impact of fiscal 2023 MTM retirement plans accounting adjustments and costs related to business optimization initiatives.

 

We have provided these non-GAAP financial measures for the same reasons that were outlined above for historical non-GAAP measures. These items are excluded from our fiscal 2023 EPS and ETR forecasts, as applicable, for the same reasons described above for historical non-GAAP measures.

 

We are unable to predict the amount of the MTM retirement plans accounting adjustments, as they are significantly impacted by changes in interest rates and the financial markets. We also may incur additional costs in fiscal 2023 related to business optimization initiatives. We are currently unable to forecast the amount and timing of these additional costs, which may impact the fiscal 2023 ETR. Accordingly, such adjustments and costs are not included in our fiscal 2023 EPS and ETR forecasts. For this reason, a full reconciliation of our fiscal 2023 EPS and ETR forecasts to the most directly comparable GAAP measures is impracticable. It is reasonably possible, however, that our fiscal 2023 MTM retirement plans accounting adjustments and costs related to business optimization initiatives could have a material impact on our fiscal 2023 consolidated financial results and ETR.

 

7


 

The table included below titled “Fiscal 2023 Earnings Per Share Forecast” outlines the impacts of the items that are excluded from our fiscal 2023 EPS forecast, other than the MTM retirement plans accounting adjustments and costs related to business optimization initiatives.

 

 

8


 

Fourth Quarter Fiscal 2022

 

FedEx Corporation

 

 

 

Operating

 

 

Income

 

 

Net

 

 

Diluted
Earnings

 

Dollars in millions, except EPS

 

Income

 

 

Margin

 

 

Taxes1

 

 

Income2

 

 

Per Share

 

GAAP measure

 

$

1,924

 

 

 

7.9

%

 

$

126

 

 

$

558

 

 

$

2.13

 

MTM retirement plans
   accounting adjustment3

 

 

 

 

 

 

 

 

315

 

 

 

1,003

 

 

 

3.83

 

FedEx Ground legal matter4

 

 

210

 

 

 

0.9

%

 

 

50

 

 

 

160

 

 

 

0.61

 

Business realignment costs5

 

 

60

 

 

 

0.2

%

 

 

14

 

 

 

46

 

 

 

0.18

 

TNT Express integration
   expenses6

 

 

40

 

 

 

0.2

%

 

 

8

 

 

 

32

 

 

 

0.12

 

Non-GAAP measure

 

$

2,234

 

 

 

9.2

%

 

$

513

 

 

$

1,799

 

 

$

6.87

 

 

FedEx Express Segment

 

 

 

Operating

 

Dollars in millions

 

Income

 

 

Margin

 

GAAP measure

 

$

886

 

 

 

7.4

%

Business realignment costs

 

 

60

 

 

 

0.5

%

TNT Express integration expenses

 

 

38

 

 

 

0.3

%

Non-GAAP measure

 

$

984

 

 

 

8.2

%

 

Full-Year Fiscal 2022

 

FedEx Corporation

 

 

 

Operating

 

 

Income

 

 

Net

 

 

Diluted
Earnings

 

Dollars in millions, except EPS

 

Income

 

 

Margin

 

 

Taxes1

 

 

Income2

 

 

Per Share

 

GAAP measure

 

$

6,245

 

 

 

6.7

%

 

$

1,070

 

 

$

3,826

 

 

$

14.33

 

MTM retirement plans
   accounting adjustments3

 

 

 

 

 

 

 

 

379

 

 

 

1,199

 

 

 

4.49

 

Business realignment costs5

 

 

278

 

 

 

0.3

%

 

 

64

 

 

 

214

 

 

 

0.80

 

FedEx Ground legal matter4

 

 

210

 

 

 

0.2

%

 

 

50

 

 

 

160

 

 

 

0.60

 

TNT Express integration
   expenses6

 

 

132

 

 

 

0.1

%

 

 

29

 

 

 

103

 

 

 

0.39

 

Non-GAAP measure

 

$

6,865

 

 

 

7.3

%

 

$

1,592

 

 

$

5,502

 

 

$

20.61

 

 

9


 

Full-Year Fiscal 2022 (continued)

 

FedEx Express Segment

 

 

 

Operating

 

Dollars in millions

 

Income

 

 

Margin7

 

GAAP measure

 

$

2,922

 

 

 

6.4

%

Business realignment costs

 

 

278

 

 

 

0.6

%

TNT Express integration expenses

 

 

115

 

 

 

0.3

%

Non-GAAP measure

 

$

3,315

 

 

 

7.2

%

 

Fourth Quarter Fiscal 2021

 

FedEx Corporation

 

 

 

Operating

 

 

Income

 

 

Net

 

 

Diluted
Earnings

 

Dollars in millions, except EPS

 

Income

 

 

Margin7

 

 

Taxes1

 

 

Income2

 

 

Per Share

 

GAAP measure

 

$

1,797

 

 

 

8.0

%

 

$

745

 

 

$

1,868

 

 

$

6.88

 

MTM retirement plans
   accounting adjustment3

 

 

 

 

 

 

 

 

(292

)

 

 

(936

)

 

 

(3.44

)

Loss on debt extinguishment

 

 

 

 

 

 

 

 

96

 

 

 

297

 

 

 

1.09

 

Business realignment costs5

 

 

106

 

 

 

0.5

%

 

 

24

 

 

 

82

 

 

 

0.30

 

TNT Express integration
   expenses6

 

 

64

 

 

 

0.3

%

 

 

15

 

 

 

49

 

 

 

0.18

 

Non-GAAP measure

 

$

1,967

 

 

 

8.7

%

 

$

588

 

 

$

1,360

 

 

$

5.01

 

 

FedEx Express Segment

 

 

 

Operating

 

Dollars in millions

 

Income

 

 

Margin7

 

GAAP measure

 

$

737

 

 

 

6.5

%

Business realignment costs

 

 

106

 

 

 

0.9

%

TNT Express integration expenses

 

 

55

 

 

 

0.5

%

Non-GAAP measure

 

$

898

 

 

 

8.0

%

 

 

10


 

Full-Year Fiscal 2021

 

FedEx Corporation

 

 

 

Operating

 

 

Income

 

 

Net

 

 

Diluted
Earnings

 

Dollars in millions, except EPS

 

Income

 

 

Margin

 

 

Taxes1

 

 

Income2

 

 

Per Share7

 

GAAP measure

 

$

5,857

 

 

 

7.0

%

 

$

1,443

 

 

$

5,231

 

 

$

19.45

 

MTM retirement plans
   accounting adjustments3

 

 

 

 

 

 

 

 

(281

)

 

 

(895

)

 

 

(3.33

)

Loss on debt extinguishment

 

 

 

 

 

 

 

 

96

 

 

 

297

 

 

 

1.11

 

TNT Express integration
   expenses6

 

 

210

 

 

 

0.3

%

 

 

48

 

 

 

162

 

 

 

0.60

 

Business realignment costs5

 

 

116

 

 

 

0.1

%

 

 

26

 

 

 

90

 

 

 

0.33

 

Non-GAAP measure

 

$

6,183

 

 

 

7.4

%

 

$

1,332

 

 

$

4,885

 

 

$

18.17

 

 

FedEx Express Segment

 

 

 

Operating

 

Dollars in millions

 

Income

 

 

Margin

 

GAAP measure

 

$

2,810

 

 

 

6.7

%

TNT Express integration expenses

 

 

176

 

 

 

0.4

%

Business realignment costs

 

 

116

 

 

 

0.3

%

Non-GAAP measure

 

$

3,102

 

 

 

7.4

%

 

 

Fiscal 2023 Earnings Per Share Forecast

 

Dollars in millions, except EPS

 

Adjustments

 

 

Diluted
Earnings
Per Share

Earnings per diluted share before MTM
    retirement plans accounting adjustments
    and costs related to business
    optimization initiatives (non-GAAP)8

 

 

 

 

$22.45 to $24.45

 

 

 

 

 

 

Business realignment costs

 

$

20

 

 

 

Income tax effect1

 

 

(5

)

 

 

Net of tax effect

 

$

15

 

 

0.05

 

 

 

 

 

 

Earnings per diluted share with
   adjustments8

 

 

 

 

$22.50 to $24.50

 

 

11


 

Notes:

 

1 – Income taxes are based on the company’s approximate statutory tax rates applicable to each transaction.

2 – Effect of “total other (expense) income” on net income amount not shown.

3 – The MTM retirement plans accounting adjustment reflects the year-end adjustment to the valuation of the company’s defined benefit pension and other postretirement plans. For the full-year fiscal 2022 period, the MTM retirement plans accounting adjustments also include the second quarter TNT Express MTM retirement plans accounting adjustment related to a noncash loss associated with the termination of a TNT Express European pension plan and a curtailment charge related to the U.S. FedEx Freight pension plan. For the full-year fiscal 2021 period, the MTM retirement plans accounting adjustments also include the second quarter TNT Express MTM retirement plans accounting adjustment related to a noncash loss associated with amending a TNT Express European pension plan to harmonize retirement benefits.

4 – These charges were recognized at FedEx Corporation.

5 – Business realignment costs were recognized at FedEx Express.

6 – These expenses were recognized at FedEx Corporation and FedEx Express.

7 – Does not sum to total due to rounding.

8 – The MTM retirement plans accounting adjustments and costs related to business optimization initiatives, which are impracticable to calculate at this time, are excluded.

 

# # #

 

12


 

FEDEX CORP. FINANCIAL HIGHLIGHTS

 

Fourth Quarter Fiscal 2022

(In millions, except earnings per share)

(Unaudited)

 

 

 

Three Months Ended
May 31,

 

Twelve Months Ended
May 31,

 

 

2022

 

2021

 

Percent Change

 

2022

 

2021

 

Percent Change

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

FedEx Express segment

 

$11,939

 

$11,275

 

6

 

$45,814

 

$42,078

 

9

FedEx Ground segment

 

8,491

 

8,132

 

4

 

33,232

 

30,496

 

9

FedEx Freight segment

 

2,756

 

2,235

 

23

 

9,532

 

7,833

 

22

FedEx Services segment

 

76

 

8

 

850

 

253

 

32

 

691

Other and eliminations1

 

1,132

 

915

 

24

 

4,681

 

3,520

 

33

Total Revenue

 

24,394

 

22,565

 

8

 

93,512

 

83,959

 

11

Operating Expenses2:

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

7,903

 

7,868

 

 —

 

32,058

 

30,173

 

6

Purchased transportation

 

5,946

 

5,630

 

6

 

24,118

 

21,674

 

11

Rentals

 

1,177

 

1,082

 

9

 

4,712

 

4,155

 

13

Depreciation and amortization

 

1,018

 

975

 

4

 

3,970

 

3,793

 

5

Fuel

 

1,760

 

936

 

88

 

5,115

 

2,882

 

77

Maintenance and repairs

 

842

 

885

 

 (5)

 

3,372

 

3,328

 

1

Business realignment costs3

 

60

 

106

 

 (43)

 

278

 

116

 

140

Other4

 

3,764

 

3,286

 

15

 

13,644

 

11,981

 

14

Total Operating Expenses

 

22,470

 

20,768

 

8

 

87,267

 

78,102

 

12

Operating Income (Loss):

 

 

 

 

 

 

 

 

 

 

 

 

FedEx Express segment

 

886

 

737

 

20

 

2,922

 

2,810

 

4

FedEx Ground segment

 

849

 

1,105

 

 (23)

 

2,642

 

3,193

 

 (17)

FedEx Freight segment

 

602

 

360

 

67

 

1,663

 

1,005

 

65

Corporate, other, and eliminations1

 

(413)

 

(405)

 

2

 

(982)

 

(1,151)

 

 (15)

Total Operating Income

 

1,924

 

1,797

 

7

 

6,245

 

5,857

 

7

Other (Expense) Income:

 

 

 

 

 

 

 

 

 

 

 

 

Interest, net

 

(158)

 

(186)

 

 (15)

 

(636)

 

(741)

 

 (14)

Other retirement plans (expense) income5

 

(1,106)

 

1,430

 

 (177)

 

(726)

 

1,983

 

 (137)

Loss on debt extinguishment6

 

 —

 

(393)

 

NM

 

 —

 

(393)

 

NM

Other, net

 

24

 

(35)

 

 (169)

 

13

 

(32)

 

 (141)

Total Other (Expense) Income

 

(1,240)

 

816

 

 (252)

 

(1,349)

 

817

 

 (265)

Income Before Income Taxes

 

684

 

2,613

 

 (74)

 

4,896

 

6,674

 

 (27)

Provision for Income Taxes

 

126

 

745

 

 (83)

 

1,070

 

1,443

 

 (26)

Net Income

 

$558

 

$1,868

 

 (70)

 

$3,826

 

$5,231

 

 (27)

Diluted Earnings Per Share

 

$2.13

 

$6.88

 

 (69)

 

$14.33

 

$19.45

 

 (26)

Weighted Average Common and
   Common Equivalent Shares

 

261

 

                                  271

 

 (4)

 

266

 

                                  268

 

 (1)

Capital Expenditures

 

$2,384

 

$1,682

 

42

 

$6,763

 

$5,884

 

15

 

1 – Includes the FedEx Office, FedEx Logistics, and FedEx Dataworks operating segments.

2 – Includes integration expenses of $40 million for the fourth quarter and $132 million for the full year of fiscal 2022 and $64 million for the fourth quarter and $210 million for the full year of fiscal 2021.

3 – Includes business realignment costs associated with the workforce reduction plan in Europe for the fourth quarter and full year of fiscal 2022 and 2021.

4 – Includes $210 million for the fourth quarter and full year of fiscal 2022 in connection with a legal matter involving FedEx Ground included in “Corporate, other, and eliminations.”

5 – Includes a ($1.3) billion MTM adjustment for the fourth quarter and full year of fiscal 2022 and a $1.2 billion MTM adjustment for the fourth quarter and full year of fiscal 2021. Also includes a ($260 million) MTM adjustment for the full year of 2022 associated with the termination of a TNT Express European pension plan and a curtailment charge related to the U.S. FedEx Freight pension plan, as well as a ($52 million) MTM adjustment for the full year of fiscal 2021 associated with amending a TNT Express European pension plan to harmonize retirement benefits.

6 – Includes a loss of debt extinguishment for the fourth quarter and full year of fiscal 2021 associated with the capital allocation strategy, which includes reducing outstanding debt.

 

13


 

FEDEX CORP. CONDENSED CONSOLIDATED BALANCE SHEETS

 

Fourth Quarter Fiscal 2022

(In millions)

(Unaudited)

 

 

 

Year Ended
May 31,

 

 

 

2022

 

 

2021

 

ASSETS

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

6,897

 

 

$

7,087

 

Receivables, less allowances

 

 

11,863

 

 

 

12,069

 

Spare parts, supplies, and fuel, less allowances

 

 

637

 

 

 

587

 

Prepaid expenses and other

 

 

968

 

 

 

837

 

Total current assets

 

 

20,365

 

 

 

20,580

 

Property and Equipment, at Cost

 

 

75,275

 

 

 

70,077

 

Less accumulated depreciation and amortization

 

 

37,184

 

 

 

34,325

 

Net property and equipment

 

 

38,091

 

 

 

35,752

 

Other Long-Term Assets

 

 

 

 

 

 

Operating lease right-of-use assets, net

 

 

16,613

 

 

 

15,383

 

Goodwill

 

 

6,544

 

 

 

6,992

 

Other assets

 

 

4,381

 

 

 

4,070

 

Total other long-term assets

 

 

27,538

 

 

 

26,445

 

 

 

$

85,994

 

 

$

82,777

 

LIABILITIES AND COMMON STOCKHOLDERS'
   INVESTMENT

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

Current portion of long-term debt

 

$

82

 

 

$

146

 

Accrued salaries and employee benefits

 

 

2,531

 

 

 

2,903

 

Accounts payable

 

 

4,030

 

 

 

3,841

 

Operating lease liabilities

 

 

2,443

 

 

 

2,208

 

Accrued expenses

 

 

5,188

 

 

 

4,562

 

Total current liabilities

 

 

14,274

 

 

 

13,660

 

Long-Term Debt, Less Current Portion

 

 

20,182

 

 

 

20,733

 

Other Long-Term Liabilities

 

 

 

 

 

 

Deferred income taxes

 

 

4,093

 

 

 

3,927

 

Pension, postretirement healthcare, and other benefit obligations

 

 

4,448

 

 

 

3,501

 

Self-insurance accruals

 

 

2,889

 

 

 

2,430

 

Operating lease liabilities

 

 

14,487

 

 

 

13,375

 

Other liabilities

 

 

682

 

 

 

983

 

Total other long-term liabilities

 

 

26,599

 

 

 

24,216

 

Commitments and Contingencies

 

 

 

 

 

 

Common Stockholders' Investment

 

 

 

 

 

 

Common stock, $0.10 par value, 800 million shares authorized

 

 

32

 

 

 

32

 

Additional paid-in capital

 

 

3,712

 

 

 

3,481

 

Retained earnings

 

 

32,782

 

 

 

29,817

 

Accumulated other comprehensive loss

 

 

(1,103

)

 

 

(732

)

Treasury stock, at cost

 

 

(10,484

)

 

 

(8,430

)

Total common stockholders' investment

 

 

24,939

 

 

 

24,168

 

 

 

$

85,994

 

 

$

82,777

 

 

14


 

FEDEX CORP. CONDENSED CONSOLIDATED

STATEMENTS OF CASH FLOWS

 

Fourth Quarter Fiscal 2022

(In millions)

(Unaudited)

 

 

 

 

Year Ended
May 31,

 

 

 

2022

 

 

2021

 

Operating Activities:

 

 

 

 

 

 

Net income

 

$

3,826

 

 

$

5,231

 

Noncash charges:

 

 

 

 

 

 

Depreciation and amortization

 

 

3,970

 

 

 

3,793

 

Retirement plans mark-to-market adjustments

 

 

1,578

 

 

 

(1,176

)

Loss on extinguishment of debt

 

 

 

 

 

393

 

Business realignment costs

 

 

53

 

 

 

102

 

Other, net

 

 

3,524

 

 

 

3,664

 

Changes in operating assets and liabilities, net

 

 

(3,119

)

 

 

(1,872

)

Net cash provided by operating activities

 

 

9,832

 

 

 

10,135

 

Investing Activities:

 

 

 

 

 

 

Capital expenditures

 

 

(6,763

)

 

 

(5,884

)

Business acquisitions, net of cash acquired

 

 

 

 

 

(228

)

Purchase of investments

 

 

(147

)

 

 

 

Proceeds from asset dispositions and other

 

 

94

 

 

 

102

 

Net cash used in investing activities

 

 

(6,816

)

 

 

(6,010

)

Financing Activities:

 

 

 

 

 

 

Principal payments on debt

 

 

(161

)

 

 

(6,318

)

Proceeds from debt issuances

 

 

 

 

 

4,212

 

Proceeds from stock issuances

 

 

184

 

 

 

740

 

Dividends paid

 

 

(793

)

 

 

(686

)

Purchase of treasury stock

 

 

(2,248

)

 

 

 

Other, net

 

 

(1

)

 

 

(38

)

Cash used in financing activities

 

 

(3,019

)

 

 

(2,090

)

Effect of exchange rate changes on cash

 

 

(187

)

 

 

171

 

Net (decrease) increase in cash and cash equivalents

 

 

(190

)

 

 

2,206

 

Cash and cash equivalents at beginning of period

 

 

7,087

 

 

 

4,881

 

Cash and cash equivalents at end of period

 

$

6,897

 

 

$

7,087

 

 

15


 

FEDEX EXPRESS SEGMENT FINANCIAL HIGHLIGHTS

 

Fourth Quarter Fiscal 2022

(Dollars in millions)

(Unaudited)

 

 

 

 

Three Months Ended
May 31,

 

Twelve Months Ended
May 31,

 

 

2022

 

2021

 

Percent Change

 

2022

 

2021

 

Percent Change

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

Package Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Overnight Box

 

$2,390

 

$2,165

 

10

 

$9,084

 

$8,116

 

12

U.S. Overnight Envelope

 

536

 

486

 

10

 

1,971

 

1,791

 

10

Total U.S. Overnight

 

2,926

 

2,651

 

10

 

11,055

 

9,907

 

12

U.S. Deferred

 

1,370

 

1,266

 

8

 

5,330

 

4,984

 

7

Total U.S. Package Revenue

 

4,296

 

3,917

 

10

 

16,385

 

14,891

 

10

International Priority

 

3,193

 

2,894

 

10

 

12,130

 

10,317

 

18

International Economy

 

766

 

705

 

9

 

2,838

 

2,632

 

8

Total International Export
   Package

 

3,959

 

3,599

 

10

 

14,968

 

12,949

 

16

International Domestic1

 

1,063

 

1,184

 

 (10)

 

4,340

 

4,640

 

 (6)

Total Package Revenue

 

9,318

 

8,700

 

7

 

35,693

 

32,480

 

10

Freight Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

779

 

833

 

 (6)

 

3,041

 

3,325

 

 (9)

International Priority

 

1,025

 

865

 

18

 

3,840

 

3,030

 

27

International Economy

 

423

 

420

 

1

 

1,653

 

1,582

 

4

International Airfreight

 

43

 

49

 

 (12)

 

177

 

245

 

 (28)

Total Freight Revenue

 

2,270

 

2,167

 

5

 

8,711

 

8,182

 

6

Other Revenue

 

351

 

408

 

 (14)

 

1,410

 

1,416

 

 —

Total Express Revenue

 

$11,939

 

$11,275

 

6

 

$45,814

 

$42,078

 

9

Operating Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

4,028

 

4,201

 

 (4)

 

16,435

 

16,217

 

1

Purchased transportation

 

1,582

 

1,531

 

3

 

6,322

 

5,744

 

10

Rentals and landing fees

 

617

 

600

 

3

 

2,568

 

2,296

 

12

Depreciation and amortization

 

515

 

497

 

4

 

2,007

 

1,946

 

3

Fuel

 

1,521

 

789

 

93

 

4,418

 

2,461

 

80

Maintenance and repairs

 

513

 

586

 

 (12)

 

2,120

 

2,228

 

 (5)

Business realignment costs

 

60

 

106

 

 (43)

 

278

 

116

 

140

Intercompany charges

 

498

 

540

 

 (8)

 

1,997

 

1,996

 

 —

Other

 

1,719

 

1,688

 

2

 

6,747

 

6,264

 

8

Total Operating Expenses

 

11,053

 

10,538

 

5

 

42,892

 

39,268

 

9

Operating Income

 

$886

 

$737

 

20

 

$2,922

 

$2,810

 

4

Operating Margin

 

7.4%

 

6.5%

 

0.9 pts

 

6.4%

 

6.7%

 

(0.3 pts)

 

1 – International Domestic revenue relates to international intra-country operations.

 

 

 

16


 

FEDEX EXPRESS SEGMENT OPERATING HIGHLIGHTS

 

Fourth Quarter Fiscal 2022

(Unaudited)

 

 

 

 

Three Months Ended
May 31,

 

Twelve Months Ended
May 31,

 

 

2022

 

2021

 

Percent Change

 

2022

 

2021

 

Percent Change

PACKAGE STATISTICS

 

 

 

 

 

 

 

 

 

 

 

 

Average Daily Package Volume (000s):

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Overnight Box

 

1,340

 

1,442

 

 (7)

 

1,421

 

1,427

 

 —

U.S. Overnight Envelope

 

494

 

519

 

 (5)

 

506

 

505

 

 —

Total U.S. Overnight Package

 

1,834

 

1,961

 

 (6)

 

1,927

 

1,932

 

 —

U.S. Deferred

 

1,159

 

1,307

 

 (11)

 

1,262

 

1,351

 

 (7)

Total U.S. Domestic Package

 

2,993

 

3,268

 

 (8)

 

3,189

 

3,283

 

 (3)

International Priority

 

742

 

796

 

 (7)

 

786

 

752

 

5

International Economy

 

276

 

288

 

 (4)

 

277

 

284

 

 (2)

Total International Export Package

 

1,018

 

1,084

 

 (6)

 

1,063

 

1,036

 

3

International Domestic1

 

1,808

 

2,171

 

 (17)

 

1,954

 

2,362

 

 (17)

Total Average Daily Packages

 

5,819

 

6,523

 

 (11)

 

6,206

 

6,681

 

 (7)

Yield (Revenue Per Package):

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Overnight Box

 

$27.45

 

$23.09

 

19

 

$25.07

 

$22.31

 

12

U.S. Overnight Envelope

 

16.68

 

14.41

 

16

 

15.28

 

13.90

 

10

U.S. Overnight Composite

 

24.55

 

20.79

 

18

 

22.50

 

20.11

 

12

U.S. Deferred

 

18.18

 

14.90

 

22

 

16.56

 

14.46

 

15

U.S. Domestic Composite

 

22.08

 

18.44

 

20

 

20.15

 

17.79

 

13

International Priority

 

66.22

 

55.89

 

18

 

60.54

 

53.84

 

12

International Economy

 

42.66

 

37.67

 

13

 

40.13

 

36.32

 

10

Total International Export Composite

 

59.82

 

51.05

 

17

 

55.21

 

49.03

 

13

International Domestic1

 

9.05

 

8.39

 

8

 

8.71

 

7.70

 

13

Composite Package Yield

 

$24.64

 

$20.51

 

20

 

$22.56

 

$19.06

 

18

FREIGHT STATISTICS

 

 

 

 

 

 

 

 

 

 

 

 

Average Daily Freight Pounds (000s):

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

7,660

 

8,662

 

 (12)

 

7,935

 

9,231

 

 (14)

International Priority

 

6,533

 

6,608

 

 (1)

 

6,671

 

6,155

 

8

International Economy

 

11,544

 

11,691

 

 (1)

 

11,978

 

12,245

 

 (2)

International Airfreight

 

1,050

 

1,280

 

 (18)

 

1,160

 

1,469

 

 (21)

Total Avg Daily Freight Pounds

 

26,787

 

28,241

 

 (5)

 

27,744

 

29,100

 

 (5)

Revenue Per Freight Pound:

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

$1.57

 

$1.48

 

6

 

$1.50

 

$1.41

 

6

International Priority

 

2.41

 

2.02

 

19

 

2.26

 

1.93

 

17

International Economy

 

0.56

 

0.55

 

2

 

0.54

 

0.51

 

6

International Airfreight

 

0.63

 

0.59

 

7

 

0.60

 

0.65

 

 (8)

Composite Freight Yield

 

$1.30

 

$1.18

 

10

 

$1.23

 

$1.10

 

12

Operating Weekdays

 

65

 

65

 

 —

 

255

 

255

 

 —

1 – International Domestic revenue relates to international intra-country operations.

 

17


 

FEDEX GROUND SEGMENT FINANCIAL AND OPERATING HIGHLIGHTS

 

Fourth Quarter Fiscal 2022

(Dollars in millions)

(Unaudited)

 

 

 

Three Months Ended
May 31,

 

Twelve Months Ended
May 31,

 

 

2022

 

2021

 

Percent Change

 

2022

 

2021

 

Percent Change

FINANCIAL HIGHLIGHTS

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$8,491

 

$8,132

 

4

 

$33,232

 

$30,496

 

9

Operating Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

1,683

 

1,577

 

7

 

7,101

 

6,060

 

17

Purchased transportation

 

3,791

 

3,602

 

5

 

15,232

 

14,126

 

8

Rentals

 

371

 

307

 

21

 

1,410

 

1,166

 

21

Depreciation and amortization

 

237

 

220

 

8

 

919

 

843

 

9

Fuel

 

10

 

6

 

67

 

32

 

21

 

52

Maintenance and repairs

 

151

 

140

 

8

 

584

 

496

 

18

Intercompany charges

 

494

 

504

 

 (2)

 

1,954

 

1,862

 

5

Other

 

905

 

671

 

35

 

3,358

 

2,729

 

23

Total Operating Expenses

 

7,642

 

7,027

 

9

 

30,590

 

27,303

 

12

Operating Income

 

$849

 

$1,105

 

 (23)

 

$2,642

 

$3,193

 

 (17)

Operating Margin

 

10.0%

 

13.6%

 

(3.6 pts)

 

8.0%

 

10.5%

 

(2.5 pts)

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING STATISTICS

 

 

 

 

 

 

 

 

 

 

 

 

Ground Commercial Operating Weekdays

 

65

 

65

 

 —

 

258

 

256

 

1

Home Delivery and Economy Operating Days

 

91

 

91

 

 —

 

359

 

359

 

 —

Average Daily Package Volume (000s)1:

 

 

 

 

 

 

 

 

 

 

 

 

Ground Commercial

 

4,500

 

4,572

 

 (2)

 

4,549

 

4,312

 

5

Home Delivery

 

3,981

 

3,968

 

 —

 

4,223

 

4,048

 

4

Economy

 

879

 

1,374

 

 (36)

 

1,130

 

1,594

 

 (29)

Total Average Daily Package Volume

 

9,360

 

9,914

 

 (6)

 

9,902

 

9,954

 

 (1)

Yield (Revenue Per Package)

 

$11.41

 

$10.31

 

11

 

$10.64

 

$9.70

 

10

1 – As FedEx Ground has expanded seven-day-per-week residential delivery coverage to virtually all of the U.S. population, Ground Commercial average daily package volume is calculated on a 5-day-per-week basis, while Home Delivery and Economy average daily package volumes are calculated on a 7-day-per-week basis. Prior year statistical information has been revised to conform to the current year presentation.

 

18


 

FEDEX FREIGHT SEGMENT FINANCIAL AND OPERATING HIGHLIGHTS

 

Fourth Quarter Fiscal 2022

(Dollars in millions)

(Unaudited)

 

 

 

Three Months Ended
May 31,

 

Twelve Months Ended
May 31,

 

 

2022

 

2021

 

Percent Change

 

2022

 

2021

 

Percent Change

FINANCIAL HIGHLIGHTS

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$2,756

 

$2,235

 

23

 

$9,532

 

$7,833

 

22

Operating Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

1,109

 

982

 

13

 

4,140

 

3,666

 

13

Purchased transportation

 

256

 

245

 

4

 

976

 

827

 

18

Rentals

 

63

 

57

 

11

 

245

 

229

 

7

Depreciation and amortization

 

103

 

102

 

1

 

406

 

417

 

 (3)

Fuel

 

228

 

140

 

63

 

662

 

398

 

66

Maintenance and repairs

 

79

 

63

 

25

 

274

 

227

 

21

Intercompany charges

 

131

 

136

 

 (4)

 

517

 

505

 

2

Other

 

185

 

150

 

23

 

649

 

559

 

16

Total Operating Expenses

 

2,154

 

1,875

 

15

 

7,869

 

6,828

 

15

Operating Income

 

$602

 

$360

 

67

 

$1,663

 

$1,005

 

65

Operating Margin

 

21.8%

 

16.1%

 

5.7 pts

 

17.4%

 

12.8%

 

4.6 pts

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING STATISTICS

 

 

 

 

 

 

 

 

 

 

 

 

Operating Weekdays

 

65

 

65

 

 —

 

254

 

253

 

 —

Average Daily Shipments (000s):

 

 

 

 

 

 

 

 

 

 

 

 

Priority

 

79.6

 

82.7

 

 (4)

 

79.1

 

76.2

 

4

Economy

 

33.3

 

34.6

 

 (4)

 

32.6

 

32.2

 

1

Total Average Daily Shipments

 

112.9

 

117.3

 

 (4)

 

111.7

 

108.4

 

3

Weight Per Shipment (lbs):

 

 

 

 

 

 

 

 

 

 

 

 

Priority

 

1,092

 

1,105

 

 (1)

 

1,092

 

1,104

 

 (1)

Economy

 

953

 

982

 

 (3)

 

947

 

987

 

 (4)

Composite Weight Per Shipment

 

1,051

 

1,069

 

 (2)

 

1,050

 

1,069

 

 (2)

Revenue/Shipment:

 

 

 

 

 

 

 

 

 

 

 

 

Priority

 

$357.94

 

$279.51

 

28

 

$320.76

 

$269.98

 

19

Economy

 

412.09

 

322.26

 

28

 

368.08

 

313.67

 

17

Composite Revenue/Shipment

 

$373.92

 

$292.12

 

28

 

$334.57

 

$282.95

 

18

Revenue/CWT:

 

 

 

 

 

 

 

 

 

 

 

 

Priority

 

$32.79

 

$25.29

 

30

 

$29.38

 

$24.45

 

20

Economy

 

43.26

 

32.83

 

32

 

38.86

 

31.80

 

22

Composite Revenue/CWT

 

$35.59

 

$27.33

 

30

 

$31.88

 

$26.46

 

20

 

19