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FedEx Swings To 4Q Loss  
User currently offlineLightsaber From United States of America, joined Jan 2005, 13014 posts, RR: 100
Posted (6 years 2 months 1 week 6 days 11 hours ago) and read 2507 times:
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http://biz.yahoo.com/ap/080618/earns_fedex.html

fair use quote:

Quote:
Considered a bellwether for the broader U.S. economy, the FedEx earnings forecast fell well below Wall Street expectations, and its shares tumbled 4.9 percent, or $4.14, to $80.19 in premarket trading.

FedEx sees 2009 earnings of $4.75 to $5.25 per share. Wall Street had predicted $5.92 per share. The package delivery company expects to earn 80 cents to $1 per share in the first-quarter. Analysts forecast $1.27 per share.

The international package shipper posted a fourth-quarter loss of 78 cents a share, or $241 million, compared with a profit of $610 million, or $1.96 per share, for the same period last year. Excluding one-time charges, FedEx earned $1.45 per share.

Revenue rose 8 percent to $9.87 billion from $9.15 billion a year earlier.

Analysts polled by Thomson Financial expected $1.47 per share on revenue of $9.6 billion.


I was surprised there wasn't already a thread on this...

Basically, its a mix of fuel prices and a slowing economy per their press release. ;(

Lightsaber


Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
14 replies: All unread, jump to last
 
User currently offlineCMHSRQ From United States of America, joined Feb 2004, 991 posts, RR: 4
Reply 1, posted (6 years 2 months 1 week 6 days 11 hours ago) and read 2467 times:

Kind of misleading

read this quote:
Fourth-quarter earnings included a one-time charge of $891 million for the expected costs of renaming the company's office service and copying division from FedEx Kinko's to FedEx Office.

So if they wouldn't have renamed FedEx Kinko's to Fed Ex Office they wouldn't have incurred the $891 million charge and actually had a profit of $650 million, $40 million more that last year.

Revenue rose 8 percent to $9.87 billion from $9.15 billion a year earlier.

So they made more money, but spent a bunch of it rebranding.



The voice of moderation
User currently offlineCatIII From United States of America, joined Mar 2008, 3029 posts, RR: 4
Reply 2, posted (6 years 2 months 1 week 6 days 11 hours ago) and read 2439 times:

The other irony in all this is, unlike the pax airlines, FedEx has more ability to pass fuel surcharges on to its customers (and the customers are more willing to pay it).

User currently offlineLightsaber From United States of America, joined Jan 2005, 13014 posts, RR: 100
Reply 3, posted (6 years 2 months 1 week 6 days 9 hours ago) and read 2283 times:
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Quoting CMHSRQ (Reply 1):
So they made more money, but spent a bunch of it rebranding.

Yes... but these expenses had to happen anyway. The whole point of that purchase was "synergy." So yes, misleading to blame purely the economy and fuel.

Quoting CatIII (Reply 2):
The other irony in all this is, unlike the pax airlines, FedEx has more ability to pass fuel surcharges on to its customers (and the customers are more willing to pay it).

To a point. Adding a few bucks to each package will slow business growth. Its certainly cheaper to video conference after FedEx'ing the part than to fly someone around the country/world.

Hopefully FedEx can get the 757's into the fleet soon. (To save some fuel.)

Lightsaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
User currently offlineA342 From Germany, joined Jul 2005, 4681 posts, RR: 3
Reply 4, posted (6 years 2 months 1 week 6 days 9 hours ago) and read 2228 times:



Quoting Lightsaber (Reply 3):
Hopefully FedEx can get the 757's into the fleet soon. (To save some fuel.)

Hang them GTFs onto the 727s! Screw the center engine!  biggrin 



Exceptions confirm the rule.
User currently offlineLAXintl From United States of America, joined May 2000, 25165 posts, RR: 46
Reply 5, posted (6 years 2 months 1 week 6 days 9 hours ago) and read 2222 times:

Remeber Fedex is more then just the airline portion we think off...


For all practial purposes that side of the house produces a handsome profit for the quarter.

The net loss was due to a write down of $891 million related to Kinko's


So no the sky is not falling at FX  Yeah sure



From the desert to the sea, to all of Southern California
User currently offlineIkramerica From United States of America, joined May 2005, 21511 posts, RR: 60
Reply 6, posted (6 years 2 months 1 week 6 days 8 hours ago) and read 2151 times:



Quoting CMHSRQ (Reply 1):
So if they wouldn't have renamed FedEx Kinko's to Fed Ex Office they wouldn't have incurred the $891 million charge and actually had a profit of $650 million, $40 million more that last year.

Which I think is a stupid move. Kinkos is a household name. Office is generic, or as a brand, thought of us a bloated pieced of software from microsoft.



Of all the things to worry about... the Wookie has no pants.
User currently offlineCosmicCruiser From United States of America, joined Feb 2005, 2255 posts, RR: 15
Reply 7, posted (6 years 2 months 1 week 6 days 8 hours ago) and read 2073 times:



Quoting Ikramerica (Reply 6):
Which I think is a stupid move. Kinkos is a household name. Office is generic,

You should have given Fred a call with your opinion...here's an excerpt from the newspaper..


FedEx wants to make Kinko's an integrated part of the overall business," said Dan Ortwerth at Edward Jones in St. Louis.

"Keeping the Kinko's name would preserve a psychological separation that doesn't exist anymore."

In the beginning, the identity was important to reassure those loyal to Kinko's that the brand was what they had always known and trusted.

Now that the public accepts Kinko's as part of FedEx, the time is right for change, he said.


User currently offlineLightsaber From United States of America, joined Jan 2005, 13014 posts, RR: 100
Reply 8, posted (6 years 2 months 1 week 6 days 5 hours ago) and read 1978 times:
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Quoting A342 (Reply 4):
Hang them GTFs onto the 727s! Screw the center engine!

 rotfl  Little matter of strut strength.  Wink

Quoting LAXintl (Reply 5):
So no the sky is not falling at FX

True. But FedEx is a barometer for the economy. They just shaved 15% off their predicted 2009 earnings. In many ways, that is the bigger news. FedEx will survive. No doubt about that. But at what size? What stock price? What rate of growth? If fuel is impacting them, it would mean more trucking and less flying.  Sad

Quoting CosmicCruiser (Reply 7):
Now that the public accepts Kinko's as part of FedEx, the time is right for change, he said.

I agree with that part.

Lightsaaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
User currently offlineLV From United States of America, joined Jun 2001, 2005 posts, RR: 0
Reply 9, posted (6 years 2 months 1 week 4 days 23 hours ago) and read 1703 times:

I think the next thing FedEx needs to do is intergrate it's Ground and Express networks into one seemless carrier. The biggest advatage UPS has over FedEx is the fact that one person picks up both my air and ground packages. Heck, even DHL does that... but Fed Ex, I have to seperate out my packages and make sure the right driver gets the right ones.

But that's a little of the subject and I'm sure Fred knows what he is doing.


User currently offlineJohnClipper From Hong Kong, joined Aug 2005, 844 posts, RR: 0
Reply 10, posted (6 years 2 months 1 week 4 days 19 hours ago) and read 1625 times:



Quoting CatIII (Reply 2):
The other irony in all this is, unlike the pax airlines, FedEx has more ability to pass fuel surcharges on to its customers (and the customers are more willing to pay it).

Not necessarily. Customers will only take so much of a FSC before they look at other avenues. Also, I starting to see customers try to negotiate FSCs.


User currently offlineXT6Wagon From United States of America, joined Feb 2007, 3396 posts, RR: 4
Reply 11, posted (6 years 2 months 1 week 4 days 18 hours ago) and read 1615 times:



Quoting CMHSRQ (Reply 1):
Fourth-quarter earnings included a one-time charge of $891 million for the expected costs of renaming the company's office service and copying division from FedEx Kinko's to FedEx Office.

Not allways, you can write off alot of stuff to things they don't really belong under. So while there may have been expenses related to the renaming, its highly possible that much if not all of that cost would have existed regardless of the namechange.


User currently offlineYyz717 From Canada, joined Sep 2001, 16248 posts, RR: 56
Reply 12, posted (6 years 2 months 1 week 4 days 16 hours ago) and read 1568 times:



Quoting CatIII (Reply 2):
The other irony in all this is, unlike the pax airlines, FedEx has more ability to pass fuel surcharges on to its customers (and the customers are more willing to pay it).

Not sure I agree. Alot of air shipments can be moved by ground to save money. The same price elasticity (perhaps more) likely exists with air freight as with air passengers.

Quoting Lightsaber (Reply 3):
Hopefully FedEx can get the 757's into the fleet soon. (To save some fuel.)

28 procured or committed to procure (defined as specific tail #'s to be added) thus far. Out of a planned 87.

Quoting Lightsaber (Reply 8):
But FedEx is a barometer for the economy.

Only according to Fedex, as they frequently self-gloss about. But really no more than GM, Walmart, Super 8 Motels, Petsmart, McDonalds, Sears and perhaps one million other companies. Transportation is but one relatively small component of the entire US economy (key word relative). Manufacturing and retail sales are arguably stronger economic barometers.



Panam, TWA, Ansett, Eastern.......AC next? Might be good for Canada.
User currently offlineAaron747 From Japan, joined Aug 2003, 8134 posts, RR: 26
Reply 13, posted (6 years 2 months 1 week 4 days 12 hours ago) and read 1519 times:



Quoting Ikramerica (Reply 6):
Which I think is a stupid move. Kinkos is a household name. Office is generic, or as a brand, thought of us a bloated pieced of software from microsoft.

Except that this comment is Americentric. FedEx is a global brand, and 'Office' is a more identifiable word in most countries using English as a second-language than 'Kinkos'. For many years since the merger, there had been confusion in Japan as to what exactly Kinkos was. Of course people got the gist once they actually visited one, but on the basis of brand identity alone keeping the name globally doesn't do FedEx any favors.



If you need someone to blame / throw a rock in the air / you'll hit someone guilty
User currently offlineLightsaber From United States of America, joined Jan 2005, 13014 posts, RR: 100
Reply 14, posted (6 years 2 months 1 week 4 days 5 hours ago) and read 1406 times:
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Quoting Yyz717 (Reply 12):
Only according to Fedex,

It wasn't FedEx who came up with the correlation between express shipments and short term economic output. Ok, its FedEx + UPS + DHL + the post office's express mail. But there is a correlation. FedEx and UPS both send their DAILY shipping volumes to a variety of central banks around the world.


Quoting Aaron747 (Reply 13):
For many years since the merger, there had been confusion in Japan as to what exactly Kinkos was

Interesting point. Thank you for the international perspective.

Quoting Yyz717 (Reply 12):
Not sure I agree. Alot of air shipments can be moved by ground to save money.

Exactly. FedEx has to always look over their shoulder for UPS and vice versa.

Lightsaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
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