REUTERS - FedEx Corp
The world's second-largest package delivery company said it now expects profit for its fiscal year, which ends in May, to come to $6.20 to $6.60 per share, below its prior forecast of $6.90 to $7.40 a share.
Wall Street had expected a full-year profit of $7.03 per share.
FedEx's shares fell 2 percent to $87.35 in premarket trading from Monday's close of $89.28 on the New York Stock Exchange.
"Weak global economic conditions dampened revenue growth (and) drove a shift by our customers to our deferred services," Chief Financial Officer Alan Graf said in a statement.
Earlier this month, FedEx had warned the slowing economy was hurting its results, following larger rival United Parcel Service Inc
Net income for its fiscal first quarter that ended August 31, was $459 million, or $1.45 per share, down 1 percent from $464 million, or $1.46 per share, a year earlier.
That figure is well below the $1.56 analysts on average had looked for prior to the company's profit warning early this month, but above Wall Street's revised earnings target of $1.40 per share, according to Thomson Reuters I/B/E/S.
Total revenue rose 3 percent to $10.79 billion.
Profit was heavily weighted by the company's express segment, which handles overnight package delivery by aircraft, where operating earnings fell 28 percent. The segment reported a 5 percent drop in U.S. package deliveries.
Memphis, Tennessee-based FedEx said it will raise its average shipping rates 3.9 percent in the United States starting January 7.
(Reporting By Scott Malone; Editing by Gerald E. McCormick and Maureen Bavdek)
Source: http://news.yahoo.com/fedex-cuts-2013-profit-target-shares-fall-2-122834357--sector.html
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