UPS reports strong fourth-quarter growth, Asia, Europe led in international shipments
US-BASED logistics company UPS announced that its revenue from domestic operations in the fourth quarter of 2016 climbed 6.3 per cent year on year, while its international export shipments soared by 8.4 per cent, led by Asia and Europe.
UPS chairman and chief executive officer David Abney said yesterday that revenue and volume growth accelerated during the year-end holiday season.
He added that the international segment delivered extraordinary performance, while US operations managed through considerable changes in product mix.
“Our strategies and initiatives are creating long-term value for both UPS customers and shareowners,” he said.
The company reported that US revenue increased by US$648 million to $10.9 billion (Bt382 billion) in the fourth quarter of last year, a 6.3-per-cent increase over the final quarter of 2015.
Average daily shipments increased by 5.0 per cent to 19.6 million.
Meanwhile, its international segment produced strong volume growth across all major products. Revenue increased by 5 per cent, driven by an 8.4-per-cent jump in daily export shipments.
Currency-neutral revenue increased by 6.2 per cent over the prior year.
In the fourth quarter of 2016, operating profit was $281 million; adjusted operating profit was $706 million. Adjusted operating profit excludes the mark-to-market pension charge.
The company provides guidance on an adjusted (non-GAAP) basis because it is not possible to predict or provide a reconciliation reflecting the impact of future pension mark-to-market adjustments, which would be included in reported (GAAP) results and could be material.
“The investments in Orion and automation provided benefits during the quarter,” said Richard Peretz, UPS chief financial officer. “However, bottom-line results were challenged by a shift in product mix and the continued softness in industrial production. Strong growth, combined with our network investments, provide UPS with great opportunities for many years to come.”
UPS expects 2017 adjusted diluted earnings per share (EPS) to be $5.80 to $6.10, which includes $400 million of pre-tax currency headwinds.
Further, the currency drag lowers the adjusted diluted EPS by $0.30 in 2017, and decreases the EPS growth rates by approximately 500 basis points.
