FedEx Lifts Outlook as It Integrates TNT Express--Update
September 20 2016 - 6:10PM
Dow Jones News
By Anne Steele
FedEx Corp. increased its earnings forecast for the year as the
package-delivery giant works to integrate the Dutch parcel firm TNT
Express NV amid a tepid economic outlook.
The company also reported revenue and adjusted earnings for the
August quarter that topped expectations, lifting shares of FedEx by
2.3% to $166.45 in after-hours trading.
FedEx bought TNT in May for nearly $5 billion. For the fiscal
year ending in May, the Memphis, Tenn., company said it now expects
earnings excluding TNT-related integration and other costs of
$11.85 to $12.35 a share. Previously, it had forecast adjusted
per-share earnings of $11.75 to $12.25.
Chief Executive Frederick Smith said the integration of TNT
Express is "proceeding smoothly." He said results were strong,
"especially given the global economy's continued low growth."
For the quarter ended Aug. 31, FedEx reported a profit of $715
million, or $2.65 a share, up from $692 million, or $2.42 a share,
a year ago. FedEx said costs from TNT's integration and
restructuring program dented earnings by 17 cents a share, while an
intangible asset amortization expense for TNT shaved another 8
cents off per-share profit.
Excluding those items, adjusted per-share earnings rose to $2.90
a share. Revenue rose 20% to $14.7 billion. Analysts polled by
Thomson Reuters had projected adjusted per-share profit of $2.81 on
$14.61 billion in revenue.
Chief Financial Officer Alan Graf said that as FedEx continues
to integrate TNT, there will be opportunities to improve
earnings.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
September 20, 2016 17:55 ET (21:55 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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