UPS recorded a nearly 3% increase in revenues in the fourth quarter of 2012 but realised a $1.75 billion loss in reported net income.
The large loss was impacted by an increase in pension expenses due to mark-to-market, non-cash, after-tax charges of $3 billion during the quarter.
When adjusted, net income would have increased by 1.8% in the quarter to $1.28 billion, up from $1.25 billion in the fourth quarter of 2011. Adjusted operating profits totalled $2 billion, or an increase of 1.2%.
Reported revenues increased in the USA domestic package segment to $8.93 billion, up $263 million from the same period of 2011. International package revenue remained relatively flat, increasing 1.5% to $3.2 million between the two quarters.
Average daily package volume with the USA increased 3% to 16.1 million, and international packages increased 2.2% to 2.66 million.
Operating expenses increased by nearly 34% to $17.3 million in the fourth quarter. Repairs and maintenance expenses decreased by 3.9% to $317 million and fuel expenses increased 1.5% to $1.1 million compared to the same period a year earlier.
UPS fell below its targets for the full year, executives told investors in a fourth quarter conference call. For the 2012 fiscal year, UPS saw a 78.8% decrease in net income of $807 million, down from $3.8 billion in the fourth quarter of 2011. Revenues for the year increased 1.9% to 54.1 billion in the fourth quarter. Operating profits for the year decreased by 77.9% to $1.34 billion.