FedEx CEO: "Worst behind us", CFO: "Poised for growth in our second half"

QUARTER to quarter economic improvement is expected this financial year by FedEx Corp chairman and CEO Frederick Smith.

"There are signs that the worst of the recession is behind us and we remain optimistic," he said after reporting that his company lost US$876 million in the fiscal year ending May 31, compared to earning $241 million in the previous financial year.

"FedEx operations performed well even with strong economic headwinds, thanks to decisive management actions to control costs and committed team members who delivered outstanding service to our customers," said Mr Smith.

The company said it had revenue of $7.85 billion, down 20 per cent year on year from $9.87 billion.

FedEx said it expected to earn 30 to 45 cents per diluted share in the current quarter compared to $1.23 per diluted share a year ago. This outlook assumes current fuel prices and a stable economic environment, reported American Shipper.

FedEx anticipates an extremely difficult operating environment in the first two quarters because manufacturing activity is down year on year. Last financial year's first quarter results were lifted by a robust economy. This made earnings comparisons difficult, said the company. Recent higher fuel prices would also have a negative impact on first quarter results.

Said chief financial officer Alan Graf: "At this time we do not have enough visibility into the economic recovery and jet fuel prices to provide a meaningful annual earnings forecast. However, we believe that FedEx will be poised for growth in our fiscal second half, as our many cost-saving initiatives gain traction and the economy begins to improve."

(Source: Shipping Online)