FedEx doubles profits as express demand rises

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A rise in demand for express services helped FedEx double its operating profit to $628m (£408m) in the first quarter.

Chairman Fred Smith said: “Strong demand for our services resulted in higher volumes and better revenue per shipment at FedEx Express and FedEx Ground.”

First quarter sales were up 18 per cent on last year to $9.46bn (£6.15bn).

“This increased demand comes from improved global economic conditions and the benefit provided by the strength and flexibility of our unparalleled global networks, which we’ve improved during the downturn to deliver even more reliability and value to our customers,” said Smith.

The group also announced plans to combine its US trucking businesses, FedEx Freight and FedEx National LTL, from next year saying it would increase efficiencies and reduce operational costs.

FedEx is forecasting continued strong demand for package transport services at least until December. Chief financial officer Alan Graf said: “Shippers of high value-added goods, especially in the technology sector, know that we have unmatched air express capacity to deliver quickly and reliably for them, even when demand surges. We expect the yield improvement initiatives we have underway, coupled with the current high utilisation of our planes, vehicles and facilities, will drive higher earnings, margins and returns.”


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