FedEx beats by $0.84, reports revs in-line; guides FY24 EPS in-line, expects flat yr/yr revs; to repurchase additional $1.5 bln of stock during FY24
Reports Q1 (Aug) earnings of $4.55 per share, excluding non-recurring items, $0.84 better than the FactSet Consensus of $3.71; revenues fell 6.5% year/year to $21.68 bln vs the $21.74 bln FactSet Consensus.
FedEx Express operating income increased 18% during the quarter, as a 9% decline in revenue was more than offset by reduced operating expenses. Cost reductions and transformation efforts that benefited the quarter included structural flight reductions, the alignment of staffing with volume levels, parking aircraft, and shifting to one delivery wave per day in the U.S.
FedEx Ground operating income increased 59% during the quarter primarily due to yield improvement and cost reductions. Cost per package declined more than 2%, driven by lower line-haul expense and improved dock and first- and last-mileproductivity.
FedEx Freight operating income decreased 26% during the quarter driven by lower fuel surcharges and shipments, partially offset by base yield improvement. FedEx Freight completed the planned closure of 29 terminal locations during August.
Co issues in-line guidance for FY24, sees EPS of $17.00-18.50 (up at the low end from $16.50-18.50), before the MTM retirement plans accounting adjustments and excluding costs related to business optimization initiatives, vs. $17.49 FactSet Consensus.
Co expects FY24 (May) revs to remain flat yr/yr, narrowed from its previous forecast of flat to low-single-digit percent growth. FactSet Consensus calls for -0.5% growth yr/yr.
Co expects to repurchase an additional $1.5 billion of common stock during fiscal 2024 after completing a $500 mln accelerated share repurchase transaction during the quarter.