Category Archives: UPS-United Parcel Service

Video: UPS air-to-air aircraft video shoot

A new video from UPS:

UPS planes get their moment in front of the camera.

With help from production company 3 Delta Fox and funding from Boeing, UPSers used a 16-hour work day to make some movie magic with our aircraft. First, the video crew went up in a Learjet and UPS pilots took their seats in a Boeing 767. They cruised around downtown Los Angeles and up the California coast line, including the Pacific Ocean. Eventually, they worked their way to San Bernardino, California, where the video crew switched from the Learjet to a helicopter to capture ground shots.

The crew repeated this for the Boeing 757 and the MD-11. Thanks to the clear skies, they were able to capture sunrise, sunset and the afternoon California glow. This kind of shoot takes months of planning, meetings and safety briefings to make sure the entire crew is safe and prepared.

The BrownTales crew went behind the scenes to see what it takes to get these beauty shots. Enjoy!

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UPS celebrates 111 years as a company

UPS Airlines has issued this statement on social media:

It’s our birthday! UPS (as a company) was founded 111 years ago, but of course we don’t look a day over 30.

Photos: UPS.

UPS and International Brotherhood Of Teamsters reach handshake agreement for new National Master Agreement

UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N609UP (msn 64254) PAE (Nick Dean). Image: 941249.

UPS issued this statement:

Months of collective bargaining have culminated in a tentative agreement for UPS and the International Brotherhood of Teamsters. The five-year agreement, which is subject to ratification, covers Teamsters-represented UPS employees in small package roles.

UPS’s goal has been to reward the company’s employees for their contributions to its success while enabling the business to remain flexible to meet its customers’ needs – each of these goals have been met in the new agreement. UPS is well-positioned to grow and meet the needs of its customers.

Negotiations continue on a number of supplemental agreements that cover local work rules as well as the separate agreement that covers about 11,000 Teamsters-represented employees in the UPS Freight® network.

The new agreements will go into effect August 1, 2018, once they are ratified by employees.

Copyright Photo: UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N609UP (msn 64254) PAE (Nick Dean). Image: 941249.

UPS aircraft slide show:

UPS reports on its first quarter financial performance

N609UP

Atlanta, GA

  • International Revenue and Operating Profit Climb 15%
  • Average Daily Exports grew 12%, Led by Europe and U.S. Trade Lanes
  • Supply Chain & Freight Operating Profit up 14% on 16% Revenue Growth
  • U.S. Domestic Revenue Rises 7.2% on 4.6% Volume Growth
  • Weather Conditions Muted First Quarter U.S. Domestic Results  
  • Cash from Operations of $4.1B Resulted in Free Cash Flow* of $2.6B
  • Reaffirms Full-Year 2018 Adjusted EPS Guidance

UPS has announced that first quarter 2018 earnings per share rose 17% to $1.55, led by double-digit operating profit growth in both International and Supply Chain and Freight segments.

“Top-line growth in our business was strong across all business segments, reflecting the power of UPS’s global solutions and continued favorable economic conditions,” said UPS Chairman and CEO David Abney. “When combined with our transformation initiatives, these favorable trends position UPS for strong returns going forward.”

 

Consolidated Results

 

1Q 2018

 

1Q 2017

 

 

% Change

Revenue

$17,113 M

$15,510 M

10%

Net income

$1,345 M

$1,166 M

15%

Diluted earnings per share

$1.55

$1.33

17%

For the total company in 1Q 2018:

  • Total revenue increased 10% to $17.1 billion, on strong demand for UPS solutions.
  • Average yield increased by 4.3%, led by International and U.S. Deferred Air products.
  • UPS rewarded shareowners by increasing dividends per share by nearly 10% over the prior year, and distributing $840 million during the quarter.
  • To support investment strategies the company made capital expenditures of $1.5 billion.
  • The lower effective tax rate reflects a more competitive U.S. tax structure, some discrete tax items and includes the impact of share-based compensation.
  • First quarter results include the adoption of new accounting standards for pension and revenue recognition.  Prior-period results were also recast to reflect these changes.

U.S. Domestic Segment

The U.S. Domestic segment experienced strong demand as customers increasingly chose UPS solutions.  Both unexpected and planned items weighed on operating profit for the segment during the first quarter.

 

 

1Q 2018

 

1Q 2017

Revenue

$10,227 M

$9,536 M

Operating profit

$756 M

$950 M

For the U.S. Domestic segment in 1Q 2018:

  • Revenue increased to $10.2 billion, up 7.2% over 1Q 2017.  Revenue improved across all products, signaling the strong market demand for UPS solutions.
  • Revenue per piece increased 2.6% as higher base-rate pricing and fuel surcharges offset headwinds from customer and product mix.
  • Operating profit includes headwinds from severe winter weather of $85 million, Saturday deployment, network projects and higher pension expenses.

International Segment

“The execution of our diversified global strategies and our investments produced double-digit growth in revenue and profit,” said Abney.  “Each of our International regions is contributing to our financial gains, and we expect this strong momentum to continue.”

 

 

 

1Q 2018

 

1Q 2017

Revenue

$3,533 M

$3,074 M

Operating profit

$594 M

$518 M

For the International segment in 1Q 2018:

  • International revenue increased 15% despite two fewer operating days in many countries. Currency-neutral revenue increased 8.7%.
  • Export, Domestic and Cargo product groups all achieved double-digit revenue growth.
  • Export shipments per day grew an average 12% as premium products continue to outpace non-premium.
  • Export volume growth in Europe and the U.S. continued to be strong for the quarter.
  • Operating profit was $594 million, up 15% on higher Export shipments and expanded product yields.  Currency-neutral operating profit increased 10%.

Supply Chain and Freight Segment

The Supply Chain and Freight segment produced another quarter of strong financial results.  Revenue and operating profit grew by double digits due to successful revenue-quality initiatives, opportunistic growth strategies and structural cost reductions.

 

 

1Q 2018

 

1Q 2017

Revenue

$3,353 M

$2,900 M

Operating profit

$170 M

$149 M

For the Supply Chain and Freight segment in 1Q 2018:

  • Revenue increased to $3.4 billion, up 16% over 1Q 2017.  The business units focused on high quality, middle-market customers.
  • The Forwarding business led all units with 27% revenue growth, as revenue management initiatives and stable market conditions drove top-line gains.
  • UPS Freight revenue increased 9.9% on solid LTL (less-than-truckload) pricing and tonnage growth.
  • Operating profit was $170 million, up 14% from the same quarter in 2017.

Outlook

The company provides guidance on an adjusted (non-GAAP) basis because it is not possible to predict or provide a reconciliation reflecting the impact of future pension mark-to-market adjustments or other unanticipated events, which would be included in reported (GAAP) results and could be material.

“Our focused business strategies are producing strong results in both the International and Supply Chain segments,” said Richard Peretz, UPS’s chief financial officer.  “The benefits from our investments, new multi-year transformation efficiencies and stronger pricing position us well for shareowner value creation.”

  • UPS expects 2018 adjusted diluted earnings per share to be in a range of $7.03 to $7.37.
  • The company projects free cash flow of $4.5 billion to $5.0 billion in 2018.
  • The effective tax rate should be in a range of 23% to 24% for the remainder of the year.
  • Capital expenditures in 2018 are planned between $6.5 billion to $7.0 billion.

Copyright Photo: UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N609UP (msn 64254) PAE (Nick Dean). Image: 941250.

UPS Airlines aircraft slide show:

UPS keeps the Boeing 747 alive with a new order

The new Boeing 747-8F Intercontinental Freighter

UPS has made this announcement:

UPS on February 1, 2018 announced it has ordered 14 Boeing 747-8F cargo jets and four new Boeing 767-300F aircraft to provide additional capacity in response to accelerating demand for the company’s air services. All of the new aircraft will be added to the existing fleet and no existing aircraft are being replaced.

The aircraft will be delivered on an expedited schedule, building on the company’s 2016 order of 14 Boeing 747-8 freighters. All 32 of the jets will be delivered by the end of 2022, adding more than 9 million pounds of cargo capacity.  UPS’s global airline network includes more than 500 owned and leased aircraft. UPS received three new 747-8 freighters in 2017.

In addition to growing customer demand for express services, recent US tax reform legislation is enabling UPS to utilize tax savings to significantly increase capital investments and to make them earlier than previously planned.

“As we celebrate the 30th anniversary of UPS Airlines today, we are seeing unprecedented demand for our air products,” said UPS Airlines President Brendan Canavan. “The new freighters will allow us to continue upsizing aircraft on routes and will create a cascading effect that will boost capacity on regional routes around the world.”

The 747-8 freighter carries 46 shipping containers, 34 on its main deck and 12 in its lower compartments.  The -8 has a cargo capacity of 307,600 pounds, or approximately 30,000 packages and a range of 4,200 nautical miles. The new -8 aircraft line has a strong industry safety, reliability, and environmental record.   The Boeing 767 freighter has cargo capacity of 132,200 pounds and capacity for 31 air containers, 24 on the main deck and 7 in its lower compartments.  It has a range of approximately 3,000 nautical miles.  UPS currently operates 59 Boeing 767 aircraft.

Copyright Photo: UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N607UP (msn 64265) PAE (Nick Dean). Image: 939437.

UPS Airlines aircraft slide show:

 

UPS adds the Boeing 747-8F freighter

The new Boeing 747-8F Intercontinental Freighter

UPS Airlines is adding the newer and larger Boeing 747-8F Intercontinental Freighter to its Boeing 747-400F freighter fleet.

The first to be delivered was N605UP which was handed over on September 29, 2017.

The pictured N607UP completed its first flight on October 6, 2017. The new freighter became airborne in about 3,500 feet at Paine Field near Everett, WA.

In October 2016 Boeing announced an order for 14 747-8 Freighters for UPS. The agreement also includes an option to purchase an additional 14 of the cargo airplanes.

The 747-8s will enable UPS to begin a cascade of aircraft route reassignments that will add significant air capacity to the company’s busiest lanes, thereby optimizing global air network capacity well beyond the impact of adding new cargo jets.

The 14 aircraft are to be delivered between 2017 and 2020.

In addition, the 747-8 offers training and operating efficiencies to UPS. Pilots of the company’s existing 747-400 fleet will enjoy a common equipment rating, allowing them to fly both aircraft types. Further, UPS will realize greater economies of scale in maintenance and ground handling by operating the -8 aircraft.

The 747-8 freighters carry 34 shipping containers on its main deck and 14 in its lower compartments.  The -8 has a cargo capacity of 307,600 pounds, or approximately 30,000 packages and a range of 4,340 nautical miles.

N605UP arrived at the Louisville (SDF) base and is currently operating crew proving flights around SDF. It will enter revenue service later this month.

The 747 fleet usually operate from SDF to Anchorage, Alaska for refueling, and then on to its hubs in Asia.

Copyright Photo: UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N607UP (msn 64265) PAE (Nick Dean). Image: 939437.

UPS Airlines:

UPS exceeds forecasts for the second quarter, international operating profit jumps 17%

UPS (United Parcel Service) (UPS Airlines) (Atlanta and Louisville) today announced second quarter 2015 diluted earnings per share of $1.35, a 12% increase over adjusted results for the same period last year. All three segments improved operating profit and margin, led by International and Supply Chain and Freight performance.

The company continued:

UPS-We Love Logistics logo

Highlights:

  • All Segments Improve Profitability and Expand Margins
  • International Operating Profit Jumps 17%
  • Export Shipments up 5.5% with Strong Intra-Europe Growth
  • Supply Chain and Freight Operating Profit Climbs 18%
  • Revenue Growth Dampened by Changes in Currency and Fuel Prices
  • 2015 EPS Growth at Higher End of 6%-to-12% Guidance Range

Currency exchange rates and lower fuel surcharges reduced total reported revenue growth. Total revenue declined 1.2% from the same quarter last year to $14.1 billion. Pricing initiatives continue to drive base rates higher.

“During the quarter, UPS continued to invest for the future by expanding capacity and launching new capabilities that provide higher value to customers,” said David Abney, UPS chief executive officer. “The strong momentum in our International segment is expected to continue and gives us confidence in achieving the upper end of our guidance range.”

On a reported basis, operating profit increased $1.2 billion, and diluted earnings per share was up $0.86. In the second quarter of 2014, UPS reported diluted earnings per share of $0.49, which included a $665 million after-tax charge for the transfer of certain post-retirement liabilities to defined contribution healthcare plans.

Total company shipments increased 2.1% over the second quarter last year to 1.1 billion packages, led by U.S. Deferred Air products and International Export shipments.
Cash Flow

For the six months ended June 30, UPS generated $3.3 billion in free cash flow. The company paid dividends of $1.3 billion, an increase of 9.0% per share over the prior year. UPS also repurchased 13.5 million shares for approximately $1.4 billion.

U.S. Domestic Package

U.S. Domestic revenue increased $140 million over the second quarter last year to $8.8 billion. Shipment growth was led by Deferred Air products up 15% and UPS SurePost which increased more than 8%. Total daily deliveries grew 1.8% due to a slower pace of B2C (business-to-consumer) growth.

Operating profit was $1.2 billion, up $35 million or 3.0% over prior-year adjusted results. Operating margin expanded to 13.6% as improved pricing and productivity offset higher benefit costs.

On a reported basis, operating profit increased $992 million after the transfer of certain post-retirement liabilities to defined contribution healthcare plans, which occurred in the second quarter of last year.

Continued improvements in base rates were offset by lower fuel surcharges. Revenue per package was flat, as changes in fuel surcharges dropped reported yield by almost 300 basis points.

International Package

Currency-adjusted International revenue was up 1.5% over the same period last year. UPS daily Export shipments increased 5.5%, primarily due to an 8.5% increase in intra-Europe shipments. The strong dollar drove U.S. imports higher, while U.S. exports were down slightly.

International operating profit increased $81 million, or 17% over the adjusted results for the same period in 2014. Network improvements, volume growth and pricing initiatives all contributed to expanded operating margin and increased profitability. The segment experienced growth from middle-market accounts and improved premium product sales.

On a reported basis, operating profit increased $108 million after the transfer of certain post-retirement liabilities to defined contribution healthcare plans in the second quarter of last year.

Underlying base rates were up across all regions, though revenue per package decreased 2.4% on a currency-neutral basis. Lower fuel surcharges reduced reported revenue per package by about 350 basis points.

Supply Chain & Freight

Supply Chain & Freight revenue declined 4.5% to $2.2 billion, due to Forwarding revenue management initiatives, currency and lower fuel surcharges at UPS Freight. Operating profits improved $31 million, or 18% over the adjusted results for the same quarter 2014, driven by gains in Forwarding.

On a reported basis, operating profit increased $113 million after the transfer of certain post-retirement liabilities to defined contribution healthcare plans that occurred in the second quarter of 2014.

UPS Forwarding operating profit and margin expanded as the business unit continued to implement a disciplined pricing strategy across key trade lanes. The unit also benefited from improved market conditions and customer mix. Forwarding tonnage and revenue dropped during the quarter, primarily due to revenue management initiatives and the impact of currency fluctuations.

Distribution revenue increased at a mid-single digit growth rate. Growth in Mail services, Healthcare and Aerospace industries contributed to revenue improvements.

UPS Freight revenue declined 2.5% due to lower fuel surcharges and a drop in tonnage driven by changes in customer mix and slowing market growth. LTL (less-than-truckload) revenue per hundredweight growth remained positive, with a 1.4% gain.

Outlook

“The second quarter results reflect continuing gains in our International business,” said Richard Peretz, UPS chief financial officer. “Even though the U.S. economy appears to be growing at a slower pace, our global portfolio and performance reinforces our expectations to attain the higher-end of the guidance range.”

The company’s guidance for 2015 full-year diluted earnings per share is $5.05 to $5.30, a 6% to 12% increase over adjusted 2014 results.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 767-34AF N302UP (msn 27240) arrives in Anchorage, Alaska.

UPS aircraft slide show: AG Airline Slide Show

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