UPS Q1 earnings fall steeply

by Canadian Shipper

ATLANTA, Ga. — The global economic slump has driven UPS’s profits south in the first quarter of 2009, with the shipping carrier reporting a 13.7% drop in revenue compared to the same period last year. Revenue fell to $10.9 billion from $12.7 billion in 2008.

 

The company’s adjusted diluted earnings per share were $0.52 for the first quarter of 2009 compared to the $0.87 reported for the prior-year period. 

 

UPS officials blamed the “continuing deterioration in global economic activity” for the “decreased revenue and profitability in all business segments.” 

Despite the blow to profits, UPS officials say the company was managed well during the period, having been able to maintain its small package margins and expand its market share both domestically and overseas. The company has continued to invest as well, expanding its Worldport facility, building a new air hub in Shenzhen, China, and opening new healthcare distribution facilities in Europe and Puerto Rico. However, officials say UPS is scaling back 2009 capital spending by an additional $200 million, bringing the total to just below $2 billion.

“As economic activity deteriorated throughout the world during the quarter, we managed costs while maintaining our excellent service to our customers,” said Scott Davis, UPS’s chairman and CEO. “We are optimistic about the company’s future. UPS is becoming an even leaner, more efficient enterprise, making many improvements that are sustainable when the economic climate strengthens.”

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