FedEx to invest $1.6bn after strong results
FedEx the US express parcels company, has released its fourth quarter and annual results for 2004. Continuing its strong upward trend, it announced revenues in the quarter of $7.04 billion, up 21% from $5.83 billion the previous year. Its operating profit was $685 million, up 39% from $492 million in the same quarter in 2003 and operating margins grew to 9.7%.
Its revenue for the full year 2004 rose by 10% to $24.7bn whilst its operating profit (before exceptional costs) increased from $1.47bn to $1.88bn, a rise of 27%. Its increase in revenues was helped by its consolidation of Kinko’s, its office services acquisition.
Revenue for FedEx’s international express product, International Priority, grew 22% in the quarter and revenue per package rose by 7%, primarily due to an increase in average weight per package and favourable exchange rate variations. Average daily package volume increased by 12%, led by strong growth in Asia and improved U.S. export growth.
The company gave a very upbeat view of the US and world market which should prove encouraging not just to the express industry, but to the wider logistics market as a whole. It is supporting its future growth with a capital expenditure programme in 2005 valued at $1.6bn which will see it invest in new aircraft primarily within its international express division.
