UPS profit is up. Slower Growth Seen
United Parcel Service Inc. reported a 7.5 percent increase in fourth-quarter earnings yesterday, but said that profit growth would slow this year.
Shares of United Parcel fell 95 cents on the news, closing at USD72.70.
Net income rose to USD1.13 billion, or USD1.04 a share, from USD1.05 billion, or 95 cents, in the period a year earlier, the company said yesterday. Sales increased 5.6 percent, to USD12.63 billion.
United Parcel said profit growth would lag behind last year’s 11.2 percent rate because slowing industrial production would curb high-margin air shipments.
U.P.S.’s 2007 forecast calls for profit of USD4.10 to USD4.25 a share, compared with last year’s USD3.86. That would be an increase of 6.2 percent to 10 percent.
The company’s fourth-quarter results matched forecasts for earnings of USD1.04 a share, the average of 15 analyst estimates compiled by Bloomberg. Analysts had estimated 2007 earnings of USD4.30 a share.
“We are expecting the first half of the year to be somewhat flat,” the chief financial officer, D. Scott Davis, said. “It’s just a moderating economy that we expect to get back on trend by the end of 2007, early 2008.”
