FedEx hit by Harvey and cyberattack

FedEx has been hit with the cyberattack on TNT and Hurricane Harvey. This was shown in its Q1 2018 earnings report.

In a statement issued yesterday (19 September), Frederick W. Smith, FedEx Corp. chairman and chief executive officer, said: “The first quarter posed significant operational challenges due to the TNT Express cyberattack and Hurricane Harvey, and I want to thank our team members for their extraordinary dedication and performance.

“We are confident of our prospects for long-term profitable growth, and we reaffirm our commitment to improve operating income at the FedEx Express segment by $1.2 billion to $1.5 billion in fiscal 2020 versus fiscal 2017.”

For Q1 of 2018, revenues overall were $15.3 billion, up from $14.7 billion in the same period last year. Adjusted operating income for the period was down from $1.33bn to $1.24 billion. Adjusted net income was down to $683 million from $760 million.

Amongst other divisions of the firm, the FedEx Express segment saw its adjusted operating income drop from $652m to $521m.

FedEx said it is lowering its fiscal 2018 forecast due to the estimated full-year impacts of the TNT Express cyberattack.

Alan B. Graf, FedEx executive vice president and chief financial officer, commented: “The impact of the cyberattack on TNT Express and lower-than-expected results at FedEx Ground reduced our first quarter earnings.

“We are currently executing plans to mitigate the full-year impact of these issues.”

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