FedEx has announced a strong Q2 buoyed by increased volumes in each of its transportation segments. Total revenues grew 9% year-over-year to $16.3bn. Its reported operating income grew 8% to $1.26bn.
The parcels giant said that higher base rates helped increase its operating income, but this was partially offset by reduced revenue following the TNT Express cyberattack and higher TNT integration expenses.
Within the Express segment, revenues were up 8% at $9.35bn, due to higher base rates, growth in international services, higher fuel surcharges and favourable exchange rates. Operating income grew by just 2% as it was adversely effected by TNT integration expenditure, which totalled $96m.
Ground segment revenues grew 12% due to volume increases and higher base rates. Average daily packages were up 7% in the quarter. Operating income was up 12%.
FedEx also reported strong results in its Ground segment, due to increased LTL revenue per shipment growth of 7% and average daily LTL shipment growth of 4%. This helped grow revenues by 10%. Its operating income was 34% higher than the same quarter in the previous year.
Frederick W. Smith, FedEx Chairman and Chief Executive Officer, said, “Strategic execution by the FedEx team and a stronger global economy drove improved financial results, and we are well positioned for profitable, long-term growth.”
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