Author: Archive

UPS Board increases dividend

Posted by | Jan 31, 2008 | |

The UPS Board of Directors today increased the regular quarterly dividend to USD 0.45 per share from USD 0.42 on all outstanding Class A and Class B shares as a sign of its confidence in the company’s growth prospects and financial strength.

The dividend is payable March 4, 2008, to shareholders of record on Feb. 11, 2008.

UPS’s dividend has more than doubled since February 2003. The company has either increased or maintained its dividend every year for almost four decades.

The Board also approved an earlier payment schedule for the dividend typically declared in November. Beginning this year and going forward, that dividend will be paid in December instead of the following January. The actual payment date will be determined at the November meeting of the Board.

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Qatar planning to host World Postal Congress

Posted by | Jan 31, 2008 | |

Qatar will make efforts to host the Universal Postal Union’s World Postal Congress in 2012, chairman and chief executive of Q-Post Ali Mohamed al-Ali said yesterday.
He was speaking after inaugurating the first Arab postal stamps exhibition, being hosted by Q-Post, at Villagio mall.

Al-Ali said the exhibition would help participants exchange ideas and expertise and expressed the hope that it would help enhance co-operation between various postal corporations of the region.

The event will boost Qatar’s image, al-Ali said, terming the exhibition “a feather in Q-Post’s cap.”

Seventeen postal corporations and prominent philatelic societies of the region have set up pavilions at the venue. Among the collections are some of the first and the latest stamps issued by the postal corporations of the region.

Referring to Q-Post activities, Al-Ali said the corporation has brought about several innovations by introducing the latest technology. He said Q-Post has implemented several services as part of Qatar’s e-government project.

The chairman said Qatar would take the lead in forming an Arab Philately Society. “The exhibition is a first step in this direction and the Q-Post is sure that it will help enhance people’s knowledge of the culture, history and traditions of the region.”
Among those present at the inaugural ceremony were ambassadors of Palestine and Djibouti Muneir Abdullah Ghanam and Mohamadi Ali Mohamadi respectively.

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The Western Union Company reported financial results for the fourth quarter and full year 2007

Posted by | Jan 31, 2008 | |

Highlights for the fourth quarter include:

— Revenue of USD 1.3 billion, up 12pct

— EPS of USD 0.32, up 14pct

— Operating income margin of 28pct

— Consumer-to-consumer revenue increased 12pct, transactions up 14pct

— Consumer-to-business revenue grew 13pct, transactions up 49pct

Highlights for the full year include:

— Revenue of USD 4.9 billion, up 10pct

— EPS of USD 1.11, or USD 1.13 excluding the previously announced USD 0.02 per share non-cash charge

— Operating income margin of 27pct

— Cash provided by operating activities of USD 1.1 billion

— More than 335,000 agent locations

— 572 million total C2C and C2B transactions

“Western Union’s revenue and earnings growth accelerated throughout the year, which enabled us to deliver our expectations for the fourth quarter, and we are pleased with these results,” said President and Chief Executive Officer Christina Gold. “2007 demonstrated Western Union’s strengths as a geographically diverse global company, with 65pct of total annual revenue generated by our international consumer-to-consumer money transfer business. Additionally, our consumer-to-business segment continues to grow with Pago Facil, our bill payment company in Argentina, continuing to exceed expectations.”

Fourth Quarter Results

Revenue was USD 1.3 billion, up 12pct, or 10pct excluding the December 6, 2006 acquisition of Pago Facil. Revenue also included USD 28 million from currency translation of the euro.

Total consumer-to-consumer revenue in the fourth quarter grew 12pct to USD 1.1 billion on transaction growth of 14pct. A significant portion of the growth was attributable to the continued strong performance within the international consumer-to-consumer business, which increased revenue 17pct while growing transactions 19pct. The international-to-international subset, those transactions that originate outside of the U.S., grew faster still, posting 25pct revenue growth and 28pct transaction growth. This international-to-international subset contributed 54pct of Western Union’s fourth quarter total revenue.

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Arkansas Best Corporation – report from 31 January 2008

Posted by | Jan 31, 2008 | |

ABFS and the Teamsters announce tentative 5-yr labor agreement. Yesterday ABFS and the Teamsters announced a tentative agreement 2 months ahead of the March 31st expiration.

ABFS’ Teamster employees to receive same standards as YRCW. ABFS has agreed to the same standards as YRCW, now being called the National Freight Industry Standards Agreement. The key provisions under this contract are 1.9% and 7.0% wage and benefit CAGRs, totaling 3.9% overall cost growth per hour per year, up from 3.4% in the prior contract. We expect the deal to be ratified along with the YRCW deal on Feb. 8th.

No withdrawal from Teamsters’ multi-employer pensions. ABFS will continue to contribute and be liable to its multi-employer pension plans under this contract. Although a withdrawal would have required material financing costs, remaining in will result in pension expense growth of about 9% per year. Also, ABFS USD 800M-USD 850M current withdrawal liability will continue to change outside of management’s control.

FASB may chime in. FASB is currently in the research phase of overhauling its standards for multi-employer pension accounting. One key change currently under consideration is moving multi-employer liabilities onto company balance sheets similar to Int’l standards. We believe this would take 3-5 years to implement but it seems to be gaining momentum as a result of the new Pension Act effected Jan. 1st.

Stock feels ahead of itself in the near term. ABFS’ stock is up 65% from its lows in early Jan. into a sense that trucks will see demand bottom before the economy, the Fed’s more aggressive stance, and generally better than expected truck reports. While the near term news about ABFS not being allowed to withdraw from the Teamsters’ pensions could be viewed as positive for intermediate term earnings, we believe it poses a serious long-term risk to ABFS.

INVESTMENT CONCLUSION: ABFS closed up 4% yesterday versus our LTL index ex-ABFS up 3% and the S&P 500 down 0.5%. We believe the market viewed the early contract as well as ABFS not withdrawing from its multi-employer pension plans positively in the near-term, but we are not sure this is the right reaction over a longer time horizon. Although ABFS not withdrawing removes near-term risks of raising capital, adding major leverage to its balance sheet and material financing costs, we believe the long-term risk of remaining contributors is great. We have serious long-term concerns about the Teamster multiemployer pension system, which punishes surviving employers by making them liable for bankrupt companies’ pension costs and is driving the 9% pension expense increases in this contract. We believe if another large contributor to these plans were to go bankrupt and be unable to fund its withdrawal liabilities, these would shift to ABFS and the other remaining employers and would likely drive up pension expenses and withdrawal liabilities further.

ABFS is currently trading at 12.9x and 3.7x our forward EPS and EV/EBITDA estimates. This compares to its 1, 3, and 5 year averages of 11.9x, 11.2x, and 11.6x, and 3.9x, 4.0x, and 4.2x. We believe the recent run up in the truck sector has been largely short covering and long investors seeking early cyclicals with leverage into the Fed Easing cycle, and ABFS, as well as the rest of the group, are likely ahead of themselves in the near term.

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Building cleaning and maintenance: Swiss Post prepares for market liberalization

Posted by | Jan 31, 2008 | |

Swiss Post has to prepare for planned full market liberalization. It therefore wants to transfer its cleaning and maintenance services, which are not part of its core business, into a separate company. The unit responsible – Service House – should thus be able to offer its services at standard market rates in future. The current collective employment contract (CEC) conditions mean that costs are considerably higher than market rates. Swiss Post intends to hold talks with the unions about possible solutions over the next few months.

Swiss Post wants to eliminate the competitive disadvantages prior to the deregulation planned by the Federal Council. This includes the cleaning and maintenance services, which are not part of its core business. One problem is the lack of flexibility in recruiting – compared with the competition – under the current Swiss Post CEC. The current CEC conditions mean that costs for cleaning at Service House are considerably higher than market rates.

Swiss Post wants to offer its employees opportunities and make the Service House unit competitive over the medium term. It therefore favours a solution within Swiss Post Group, as foreseen in the CEC and already implemented a number of times with the unions. This means outsourcing the business into a subsidiary. The collective employment agreement provided for in such cases will be adopted and industry-specific adjustments will be set out in a follow-up agreement. It should be noted that almost all European postal organizations have outsourced their cleaning and maintenance work to external companies. Swiss Post wants to hold talks with the unions in the next few months with the aim of agreeing further steps by mid-year.

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Emirates Post hikes post box fees

Posted by | Jan 31, 2008 | |

The Emirates Post (EP) has increased the annual fees of P.O. boxes, both individual and commercial. The revised fees came into effect on January 1, according to EP officials.

Individual post boxes now cost Dh200, instead of the previous cost of Dh150, and the fee for the commercial post box has been doubled from Dh250 to Dh500.

Officials added that the increase has been imposed in order to cover the additional expenses of the services provided by the organisation.

“A circular with regard to the price hike was sent to us earlier this year. But then it is a minimal hike and we don’t think that the income of people or companies wishing to have a P.O Box number is going to be affected,” said representatives at the Al Khor Post Office.

In a press release issued by the Emirates Post on the issue, officials said that lately, the EP had spent a lot of money on introducing new services.

“EP has modernised its infrastructure. It has set up the Post Exchange Centre at Al Ramool in Dubai. A document centre is also going to be established soon,” the release said.

“Last year, EPhad signed an agreement with a Japanese company to export and set up an advanced system to handle the letters, at a cost of Dh14 million. In the next four years, the UAE and specifically Dubai is expected to receive more than a million letters daily due to the increasing number of companies and organisations in the UAE. Modern system is the only way to deal with post parcels and distributing them in a short time,” added officials.

The post offices network has expanded to include 87 branches around the UAE. Studies and researches are being conducted to modernise that network to supply customers with the best services, officials added.

“We signed a number of contracts and agreements that cost us a lot. The charges of post services, transportation and other relevant services have increased all over the world. This directly affected the charges imposed on our services. Besides, we are always promoting our services of post deliveries to post boxes and this naturally costs more,” the authorities opined.

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EPA recognizes FedEx as leader in renewable energy use (U.S)

Posted by | Jan 30, 2008 | |

FedEx Kinko’s and the FedEx Express Oakland Hub were today recognized by the Environmental Protection Agency’s (EPA) Green Power Partnership program as one of 53 Fortune 500 companies investing in green power.

Nearly a year ago, EPA asked Fortune 500 companies to collectively invest in more than 5 billion kilowatt hours (kWh) of green power – electricity that is generated from environmentally renewable resources, such as wind and solar. Today EPA announced that the program exceeded its goal by 130 percent.

The FedEx Express Oakland Hub Facility – a solar electric hub since 2005 – contributed to the goal by generating more than 1.2 million kilowatt-hours (kWh) of green power, which can supply up to 80 percent of the facility’s peak energy demand, the equivalent of power used by more than 900 homes during the daytime. The Express Oakland Hub was one of only eight Fortune 500 companies on EPA’s list that acquires green power through an on-site renewable energy system, an innovative and proactive way to help protect the environment.

FedEx Kinko’s ranked on EPA’s Top 10 Retail list with more than 76 million kWh of green power or 32 percent of FedEx Kinko’s total energy consumption. Over 785 FedEx Kinko’s locations in 38 states purchase energy from renewable sources such as wind and solar.

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Korea's Postal Office to Spend 175.4 bln won

Posted by | Jan 30, 2008 | |

Korea’s state-run post office said Tuesday that it will invest 175.4 billion won (USD 185.5 million) in 2008 mostly to improve its mailing system.

Korea Post said the investment earmarked for this year includes 37.4 billion won for procuring necessary hardware and software, 6.5 billion won for better IT systems and 57.3 billion won for system maintenance.

It also plans to spend some of the money to purchase around 40,000 radio frequency identification (RFID) tags and 600 tag readers for improving the speed at which its mailing work is carried out, the company said in a statement.

1 USD = 944.223 KRW

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