UPS pushes up supply chain margins

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UPS managed to push operating margins in its supply chain and freight business up to 7.7 per cent in the fourth quarter from 1.4 per cent the year before.

Operating profit was up from £17,5m ($28m) to £110m ($176m) on sales up from £1.27bn ($2.03bn) to £1.49bn ($2.29bn).

UPS Freight outpaced the market with revenue up 23 per cent due to double-digit growth in shipments per day, an increase in gross weight hauled and significant yield improvement. Forwarding and Logistics revenue increased 10.1 per cent to £1bn ($1.6bn), driven primarily by revenue management initiatives in the Forwarding business unit.

For the full year 2010, the company delivered 3.9 billion packages, an average of 15.6 million per day.

Sales increased 9.4 per cent to £31bn ($49.5bn). Adjusted operating profit rose 47 per cent to £3.63bn ($5.8bn) with the International and Supply Chain & Freight segments achieving record-setting levels, generating £1.2bn ($1.9bn) and £361m ($577m), respectively.

“UPS again demonstrated exceptional earnings growth by leveraging the strength of its network to provide solutions for customers,” said Scott Davis, UPS chairman and CEO. “I’m encouraged by the opportunities we see in 2011 as UPS continues to expand into emerging markets while demonstrating the power of the logistics capabilities we’ve built worldwide.”


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