FedEx Corp. lost USD 70 million in the latest quarter because of large pension and acquisition items, and the delivery giant gave a cautious outlook for the next 12 months.
The company's fiscal fourth quarter results Tuesday still beat Wall Street expectations, as FedEx and other delivery companies continue to benefit as consumers do more shopping online.
The growth in e-commerce, however, has strained the networks of companies like FedEx and United Parcel Service Inc. To keep up, FedEx plans capital spending of USD 5.1 billion in the fiscal year that just started. FedEx will use the money to expand its ground network and buy more aircraft.
FedEx said it expects earnings excluding one-time items in the new fiscal year to be between USD 11.75 and USD 12.25 per share. The midpoint of that range is less than the USD 12.17 per share that analysts were expecting, according to a FactSet survey.
In the fiscal fourth quarter, the loss amounted to 26 cents per share and compared with a year-earlier loss of USD 895 million, or USD 3.16 per share. Results were dragged down by a pension-accounting adjustment and costs related to the acquisition of Dutch delivery company TNT Express.
Without those and other charges, FedEx said it would have earned USD 3.30 per share compared with USD 2.66 per share a year earlier. Thirteen analysts surveyed by Zacks Investment Research expected USD 3.26 per share.
The Memphis, Tennessee-based company had revenue of USD 12.98 billion, beating the Zacks survey forecast of USD 12.83 billion.
Operating profit rose in both the express and ground-shipping segments, partly due to higher prices.
For the year, FedEx reported profit of USD 1.82 billion, or USD 6.51 per share, on revenue of USD 50.37 billion.
FedEx shares were down USD 1.15, or about 0.7 per cent, at USD 162.80 in after-hours trading following the earnings release. Through the end of Tuesday's regular-session trading, they have risen 10 percent since the beginning of the year, while the Standard & Poor's 500 index is up 2 per cent.
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