FedEx Corp said this afternoon that its fiscal fourth-quarter profit rose 7 per cent on increased revenue and package volumes.
The shipper also forecast fiscal 2008 earnings growth below its long-term 10 per cent to 15 per cent target, citing continued soft economic growth and planned investments to expand the company's networks and broaden service offerings.
Net income climbed to $610 million, or $1.96 per share, from $568 million, or $1.82 per share, a year ago. Excluding a gain of 6 cents per share from a settlement with Airbus related to the A380 order cancellation, the company earned $1.90 per share in the latest quarter.
Revenue rose 8 per cent to $9.15 billion from $8.49 billion in the prior-year period.
Analysts surveyed by Thomson Financial were looking for profit of $1.95 per share on revenue of $9.16 billion. FedEx had previously said it would earn $1.93 to $2.08 a share including the gain on the Airbus settlement.
'The weakened industrial sector is currently limiting demand for transportation services, but we expect the US economy to begin to show modest year-over-year improvement in the late summer to early fall timeframe,' said Frederick W. Smith, FedEx chairman, president and chief executive.
Total combined average daily package volume at FedEx Express and FedEx Ground grew about 4 percent year-over-year, led by continued growth in ground and international express shipments.
Shipment volumes and revenue at FedEx Express, FedEx Ground and FedEx Freight were lower than anticipated in the fourth quarter due to the softer economy, the company said.
FedEx projects first-quarter profit of $1.45 to $1.60 per share, and $7 to $7.40 per share for the full year, assuming an improvement in the US economy beginning in the late summer or early fall.