FedEx sets earnings record in fiscal 2017

The Memphis, Tenn.-based parcel carrier and third-party logistics provider saw double-digit year-over-year increases in both revenue and net income for its fourth quarter and full fiscal year.    FedEx Corp. saw earnings soar during the fourth quarter of its fiscal year 2017, which ended May 31, rounding out a record total fiscal year, according to the company’s most recent financial statements.
   The Memphis, Tenn.-based integrator posted a net income for its fourth quarter of $1.02 billion ($3.75 per share) compared with a net loss of $70 million ($0.26 per share) as revenues surged 20.8 percent year-over-year to 15.7 billion.
   For the full fiscal year, FedEx reported $3 billion in earnings ($11.07 per share), up 64.8 percent from $1.82 billion ($6.51 per share) in 2016. Revenues stood at $60.3 billion in FY2017, a year-over-year increase of 19.6 percent.
   After adjusting for the implementation of new foreign currency tax regulations, the adoption of a new accounting standard for share-based payments, and certain transactions related to the TNT Express integration and network expansion costs at FedEx Ground, FedEx said net income and earnings per share reflected tax benefits of $104 million, or $0.37 per diluted share. For the year, the company acquired 2.96 million shares of FedEx common stock at an average price of $172.13.
   “Strong fourth quarter results completed a record fiscal 2017,” said Frederick W. Smith, FedEx Corp. chairman and chief executive officer. “We enter fiscal 2018 confident FedEx Corp. will continue to deliver outstanding value and opportunities for shareowners, customers, and team members for years to come.”
   During the quarter, the company saw revenue within the FedEx Express segment increase 7 percent to $7.18 billion, primarily due to increased package volume, driven by international export growth of 5 percent, and higher base rates, said the company. Operating results increased primarily due to higher base rates, increased package volume, a positive net benefit from fuel and the continued benefit of cost management initiatives.
   As-reported results include $46 million of expenses related to the integration of TNT Express, said FedEx.
   The newly-integrated TNT Express segment saw fourth quarter revenues of $1.91 billion, with the as-reported results including $37 million of integration expenses and restructuring charges and $20 million of intangible asset amortization expense.
   The FedEx Ground segment saw Q4 revenues increase 9 percent, from $4.29 billion in 2016 to $4.68 billion in 2017. The company attributed the increase primarily to higher base rates and average daily package volume growth of 3 percent.
   The FedEx Freight segment also saw a 6 percent increase in revenues, from $1.61 billion in fourth quarter 2016 to $1.70 billion in 2017. Revenue increased due to higher base rates and fuel surcharges, said the company. However, average daily shipments were flat as the company focuses on improving revenue quality, said FedEx.
   Looking ahead, FedEx said it is projecting EPS of $12.45 to $13.25 per diluted share for fiscal 2018, assuming moderate economic growth.