Tag: USA

The Teamsters union said Friday FedEx Corp. may pay up to USD 33 million in incentives to delivery drivers in California, but a company spokesman says it hasn’t discussed the value of any payments with the union.

The incentives are designed to prompt California single-route drivers to take on more routes or sell existing ones. FedEx spokesman Maury Lane said the company and the Teamsters didn’t discuss the monetary value of the incentives.

Thursday, the package delivery company said the proposed incentives were in response to ‘current regulatory and legal uncertainty in California,’ which involve a dispute over the company’s drivers serving as independent contractors, rather than company employees.

The union said it’s also sponsoring a shareholder proposal at FedEx Corp.’s annual meeting on Monday that seeks to split the roles of chief executive and chairman, in an effort ‘to assure board independence and better corporate governance.’

Both roles are currently held by Fred Smith.

‘The proposal is based in part on the board of directors’ failure to instruct management to fully disclose the liabilities and potential financial impact of a major change in the FedEx Ground business model,’ the union said in a statement.

A spokesman for the union did not immediately return a call for additional comment.

FedEx Corp. today reported earnings of USD 1.58 per diluted share for the first quarter ended August 31, compared to USD 1.53 per diluted share a year ago.

FedEx increased its revenue and earnings against the backdrop of a sluggish U.S. economy, said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer. Outside of the United States, the economy is generally solid, contributing to the growth in our international express shipments. I continue to believe that FedEx will, over the long-term, reap the rewards of our strategy of investing in key growth markets and strengthening and expanding our worldwide networks.

First Quarter Results

FedEx Corp. reported the following consolidated results for the first quarter:

Revenue of USD 9.20 billion, up 8pct from USD 8.55 billion the previous year

Operating income of USD 814 million, up 4 pct from USD 784 million a year ago

Operating margin of 8.8 pct, down from 9.2 pct the previous year

Net income of USD 494 million, up 4 pct from last years USD 475 million

While operating margin improved in the FedEx Express and FedEx Ground segments, consolidated margin declined due to a lower margin year over year at FedEx Freight and to network investments to increase capacity, improve service quality and increase productivity.

Total combined average daily package volume in the FedEx Express and FedEx Ground segments grew 8 pct year over year for the quarter, due to growth in ground and international express shipments. The increase in international domestic express shipments resulted primarily from recent international acquisitions.