FedEx operating profit rises 7% in fiscal Q1

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Memphis-based logistics firm FedEx reported a 7% increase in operating income throughout all segments for the first quarter of its 2014 fiscal year ending 31 May.

Operating income across the company rose to $795 million, up from $742 million in the same period of the previous fiscal year.

Net income across FedEx’s segments also rose 7% to $489 million during the quarter, up from $459 million in the first quarter of 2013.

Overall revenues grew 2% in the quarter to $11 billion, up from $10.8 billion recorded the previous year.

FedEx’s Express segment containing its airfreight business saw a 14% increase in operating income to $236 million during the quarter, up from $207 million a year earlier.

Revenues in the Express network totalled $6.61 billion in the quarter, down from $6.63 billion in the same period of the 2013 fiscal year.

FedEx saw lower fuel surcharges and one fewer operating day during the quarter from the previous year, contributing to a 3% decrease in fuel expenses to $956 million from $986 million in the same three months of the 2013 fiscal year.

“We remain confident in our full year earnings outlook despite tepid global economic growth,” says Alan Graf, FedEx’s executive vice president and chief financial officer in an earnings release. “FedEx Express continued to execute on its profit improvement initiatives during our first quarter. We remain focused and are committed to FedEx Express achieving its $1.6 billion operating profit improvement target by the end of fiscal 2016.”