Tag: UPS

UPS is in a position to make an “extremely large” acquisition if it finds a deal that makes strategic sense, said Scott Davis, chief financial officer.
The comments revived long-standing speculation that UPS could bid for TNT, the Dutch post group, which has large package delivery operations in Europe and Asia. UPS is considered a potential buyer of TNT’s logistics division, which the group plans to auction this year, but some analysts believe the parcel business could also be sold. Mr Davis gave no clues about possible targets but cited the company’s Dollars 1.9bn of free cash flow in the first quarter as evidence that UPS had the financial strength to make a big deal. The comments came as UPS announced a 10.5 per cent increase in first-quarter net profits to Dollars 975m, driven by surging international shipments.

UPS increased net profits by more than 10 per cent in the first quarter, driven by expansion in international shipments. There was also solid growth in the US, following a series of measures last year to make the mature domestic business more efficient and competitive. “This was a quarter of outstanding growth that resulted in strong returns and excellent cash flow,” said Mike Eskew, UPS chief executive. Net profits were USD975m, or 89 cents a share, compared to USD882m, or 78 cents a share, in the same period last year. The earnings exceeded Wall Street’s consensus expectation of 88 cents a share. Revenues grew by 16.5 per cent to USD11.5bn.

UPS today reported earnings per diluted share of USD 0.89, up 14.1% over the prior year. Results were driven by a 9% increase in global small package volume or 1.24 million packages per day, outpacing worldwide market growth. The consolidated results for the period included: revenue grew 16.5% to USD11.5 billion, operating profit increased 12.3% to USD1.6 billion, net income increased 10.5% to USD975 million and free cash flow improved to USD1.9 billion. Free cash was used to buy back more than 11 million shares in an on-going repurchase program. Dividends were increased by 15% and are up 81% over the last three years. “This was a quarter of outstanding growth that resulted in strong returns and excellent cash flow,” said Mike Eskew, UPS chairman and CEO. “To drive future results, we will continue to invest in our network, technology and products to bring even more value to the customer.”