Loss for Airborne
Airborne Inc. on Wednesday posted a loss in the first quarter after a year-ago profit, due mostly to higher fuel costs and harsh winter weather.
The Seattle-based company, which plans to sell its sell its ground operations to DHL for $1.05 billion, said its first-quarter loss was $5.6 million against a profit of $5.3 million a year ago, gained mostly from cost-cutting.
“Operating expenses were negatively impacted this quarter by the rise in fuel costs and from unplanned expenses related to the severe winter weather,” chief executive Carl Donaway said.
“Combined with the expenses related to our announced strategic transaction with DHL and a charge related to the Federal Stabilization Act compensation, the impact of these items on operating earnings this quarter was approximately $20.3 million, after tax.”
Revenues rose to $825 million in the quarter from $791 million the previous year. Domestic revenue was up 4.2 percent to $744 million, while international revenue increased 5.3 percent to $80 million.
Total domestic shipment volumes increased 3.5 percent on improved ground deliveries in the United States and a 10.7 percent increase in home deliveries. “Core air express shipments, impacted by the sluggish economy and adverse winter weather, decreased 8 percent from the first quarter of last year,” the company said.
“The economy does not appear to be showing signs of any sustained strength,” Donaway said. “As a result, the outlook for the near term remains cautious. Air express volumes for 2003 are expected to be down for the year-over-year periods, including the second quarter of 2003.”
Fuel, which cost Airborne an extra $9 million in the first quarter despite surcharges on shipments, was likely to be higher in the second quarter than during April, May and June last year, the company said
