FedEx reports strong growth in 2017

Logistics and delivery giant FedEx has reported revenues of $60.3 billion for the financial year end 2017, up from $50.4bn in 2016.

Operating income on this was $5.04 billion, again up by a large margin from $3.08 billion in 2016.

The FedEx Express segment say reported revenues in Q4 grow from $6.72 billion in 2016 to $7.18. Operating income for the delivery segment was up from $757 million to $863 million. This included $46 million of expenses that were related to the integration of TNT Express. If those expenses were ignored, the adjusted operating income would be $909 million.

Explaining the results in the Express segment, FedEx said: “Operating results increased primarily due to higher base rates, increased package volume, a positive net benefit from fuel and the continued benefit of cost management initiatives.”

The logistics company says that it expects to see similar growth in 2018 and is investing to make that happen.

FedEx said: “Capital spending for fiscal 2018 is expected to be approximately $5.9 billion, which includes an increase in planned aircraft deliveries to support the FedEx Express fleet modernization program and continued investments in FedEx Ground automation and capacity expansion, including certain projects deferred from fiscal 2017.”

Alan B. Graf, FedEx’s chief financial officer, added: “Investments to modernize our aircraft fleet and expand our FedEx Ground capacity are supporting our strong earnings growth.

“We are very optimistic about fiscal 2018 as evidenced by our earnings outlook.”
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