FedEx Corporation (FedEx Express) (Memphis) reported earnings of $2.46 per diluted share for the fourth quarter ended May 31. Last yearโs fourth quarter earnings were $2.13 per diluted share, excluding a $0.98 per diluted share business realignment program charge and a $0.20 per diluted share noncash aircraft impairment charge at FedEx Express. Including last yearโs charges, earnings were $0.95 per diluted share.
โAn outstanding fourth quarter helped FedEx post solid results for fiscal 2014, and we believe we are well positioned for a strong fiscal 2015,โ said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer. โI would like to extend my sincere appreciation to the entire FedEx team for their contribution to our results and their continued commitment to providing outstanding service to our customers and connecting people and possibilities around the world.โ
For its entire fiscal year the cooperation reported net income (GAAP) ofย $1.56 billion.
Emirates SkyCargo (Dubai) starts operations today (May 1)ย from its new cargo terminal at Dubai World Centralโs (DWC) Al Maktoum International Airport.
The official start of operations was marked by the very early morning arrival of an Emirates SkyCargo Boeing 777F Freighter from London (Heathrow), carrying a full load of more than 100 tons of cargo. The load of cargo included vehicles, ship spares, pharmaceuticals, oilfield equipment and an aircraft engine, some of which are for distribution in the U.A.E., while other cargo will be carried onward by Emirates passenger aircraft at Dubai International Airport (DXB) to various markets around Emiratesโ network, such as South Africa, China, India and South Korea.
Emirates Media Player
Construction of phase one of the cargo terminal and supporting facilities began in July 2013, and with its completion operations are now in full swing with 250 staff on site. The newly opened terminal is equipped with start-of-the-art technology and will be able to handle 700 000 tons of cargo annually and have 500 staff when phase two, scheduled to be completed by September this year, comes into operation. The terminal has the potential for further expansion to reach 1 million tons.
Emirates SkyCargo currently has a fleet of 12 freighters, 10 Boeing 777Fs and two Boeing 747-400 ERFs, which operate to more than 50 destinations around the world. Cargo arriving on freighters will be transported by dedicated trucking services between DWC and Dubai International Airport along the Emirates Road (E-611) which will be the main corridor for connecting cargo between freighters and the passenger fleet. The current trucking fleet numbers 47, which will be increased relative to future growth requirements.
The newly opened terminal is equipped with state-of-the-art technology. It features a fully automated material handling system which is one of the worldโs first to have an automated Quick Dolly Transfer System that enables quick transfer of 6 Unit Load Devices (ULDs) simultaneously. In addition, an automated pallet handling system, advanced storage system, offices, work station areas, modern communication and security systems and many amenities for employees, including canteens have been installed. The perishable area has been designed to handle about 140 000 tons of cargo per annum, featuring three large areas each with different temperature ranges.
The terminal infrastructure also includes 45 truck docks and 80 truck parking spaces, in addition to 12 aircraft stands directly in front of the terminal.
Copyright Photo: Keith Burton/AirlinersGallery.com. Boeing 777-F1H A6-EFJ (msn 35610) arrives at London’s Heathrow Airport (LHR).
Atlas Air Worldwide Holdings, Inc. (Atlas Air) (New York) has announcedย it intends to pursue new ACMI (aircraft, crew, maintenance and insurance) placement opportunities for three 747-8 Freighter aircraft currently operated for British Airways plc by Atlas Air Worldwideโs 49%-owned UK subsidiary, Global Supply Systems Limited (GSS).
The action follows notice from British Airways, a unit of International Consolidated Airlines Group, S.A., regarding British Airwaysโ strategic decision to exit dedicated cargo-freighter service and to return the aircraft to GSS in April 2014 pursuant to the terms of the existing ACMI agreement between the parties.
Effective with the termination of the agreement, the three 747-8Fs will be redelivered to the company by GSS. Through GSS, the company also will receive contractual early termination fees from British Airways.
Meanwhile Qatar Airways (Doha) will operate five Boeing 777F freighter flights between Hong Kong and London for IAG Cargo (British Airways) starting on May 1. IAG Cargo issued this statement:
IAG Cargo has announced it has signed a long-term commercial agreement with Qatar Airways to purchase capacity on Qatar Airways-operated air cargo freighters, effective from May 1, 2014.
Qatar Airways will operate five Boeing 777F flights a week between Hong Kong and London on behalf of IAG Cargo, providing continuity of service for IAG Cargo customers.
The agreement marks a transition for IAG Cargo and follows the company’s decision to transfer freighter operations from its current provider, Global Supply Systems.
IAG Cargo connects 350 destinations worldwide, serving the world’s economic hubs with cargo-friendly wide-bodied planes. Through its Constant Climate network, it has one of the largest networks globally for handling temperature-sensitive air cargo.
Qatar Airways is already a partner with IAG through the oneworld global alliance which it joined in October 2013. The airline is taking delivery of a further three Boeing 777F aircraft during 2014.
Top Copyright Photo: Rainer Bexten/AirlinersGallery.com. This decision will end British Airways World Cargo and Global Supply Systems. GSS operatedย Boeing 747-87UF G-GSSD (msn 37562) in British Airways World Cargo colors departs graceful from Cologne/Bonn.
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Video: Flying the Boeing 747-800F freighter:
Bottom Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 777-FDZ A7-BFA (msn 36098) of Qatar Airways Cargo taxies at Amsterdam.
Atlas Air Worldwide Holdings, Inc. (New York), the parent of Atlas Air (New York), has confirmed completion of previously announced agreements to acquire three Boeing 777 Freighters for its dry-leasing subsidiary, Titan Aviation. The 2011-vintage aircraft were acquired from affiliates of Guggenheim Aviation Partners, LLC and are currently on long-term lease to a European express carrier.
FedEx Corporation (FedEx Express) (Memphis) today reported earnings of $1.57 per diluted share for the second quarter ended November 30, compared to $1.39 per share last year. Last yearโs second quarter results were impacted by $0.11 per diluted share due to the effects of Superstorm Sandy.
โFedEx posted solid second-quarter earnings, reflecting improved performance at FedEx Express, as the profit improvement plan introduced more than a year ago continues to gain momentum,โ said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer. โThe power of our broad global portfolio continues to drive our growth and I am confident we are well on our way to achieving the ambitious goals we have set.โ
Second Quarter Results
FedEx Corp. reported the following consolidated results for the second quarter:
โข Revenue of $11.4 billion, up 3% from $11.1 billion the previous year
โข Operating income of $827 million, up 15% from $718 million last year
โข Operating margin of 7.3%, up from 6.5% the previous year
โข Net income of $500 million, up 14% from last yearโs $438 million
Operating income and margin increased primarily due to yield and cost management at FedEx Express. Results also benefited from the favorable comparison to last yearโs Sandy-impacted results, lower pension expense and a modest benefit from the voluntary employee severance program.
In October, FedEx Corporation announced the authorization of a new share repurchase program of up to 32 million shares of common stock, which augmented the 7.4 million shares then remaining under the previously authorized repurchase program. During the second quarter, the company repurchased 7.2 million shares of FedEx common stock, increasing the fiscal 2014 year-to-date purchase total to 10.0 million shares. The second quarter share repurchases had no effect on the quarterโs earnings per share, but are expected to improve full year earnings by $0.04 per share.
Outlook
FedEx is increasing its forecast of full-year earnings per share growth to 8% to 14% above last yearโs adjusted results, compared to its previous growth range of 7% to 13%. This outlook reflects share repurchases made to date but does not include any benefit from additional share repurchases. Share repurchases are expected to continue, but the timing will be at the companyโs discretion. The outlook also assumes the market outlook for fuel prices and continued moderate economic growth. The capital spending forecast for fiscal 2014 remains $4 billion.
โWe remain on track to deliver a solid increase in earnings this fiscal year,โ said Alan B. Graf, Jr., FedEx Corp. executive vice president and chief financial officer. โFedEx Express reported significant year-over-year improvement in earnings during the quarter, aided by continued execution of our profit improvement programs and by ongoing cost reduction initiatives. We continue to look for additional ways to improve efficiencies and remain committed to increasing long-term shareowner value.โ
FedEx Express Segment
For the second quarter, the FedEx Express segment reported:
โข Revenue of $6.84 billion, down slightly from last yearโs $6.86 billion
โข Operating income of $326 million, up 42% from $230 million a year ago
โข Operating margin of 4.8%, up from 3.4% the previous year
Revenue decreased slightly due to lower express freight revenue and lower fuel surcharges, mostly offset by increased base package yields. U.S. domestic revenue per package increased 2%, as higher rates and weight per package were partially offset by lower fuel surcharges. U.S. domestic average daily package volume decreased slightly.
FedEx International Priorityยฎย (IP) revenue per package increased 3% while average daily volume declined 5%. Within the IP category, average daily volume for the lower-yielding distribution services declined while IP average daily volume, excluding these distribution services, increased 1%. FedEx International Economyยฎย average daily volume grew 10%.
Operating income and margin improved year over year due to higher base package yields, lower pension expense, and lower net expenses from ongoing cost reduction activities.
Copyright Photo: Michael B. Ing/AirlinersGallery.com. A beautiful takeoff portrait of FedEx Express’ Boeing 777-FS2 N852FD (msn 37723) after a stop at Anchorage, Alaska (click on the photo for the full-size view).
FedEx Express:ย
Video: How FedEx turns a Boeing 757 freighter in 55 minutes:
Video: FedEx has great TV advertisements that have won several marketing awards. Here is the latest for Christmas 2013:
LATAM Airlines Group (LAN Airlines and TAM Linhas Aereas) (Santiago and Sao Paulo) swung to the black in the third quarter with a net profit of $52 million versus a loss of $49 million a year ago for the same period.
Lufthansa Cargo (Frankfurt) finally accepted its first Boeing 777F freighter, the pictured 777-FBT D-ALFA (msn 41674) on November 8. D-ALFA arrived at the Frankfurt base the following day. The new freighter will enter revenue cargo service on November 19 with nonstop service to New York (JFK).
Copyright Photo: Lufthansa Cargo.
Video: Behind the scenes at Lufthansa Cargo (in German):
FedEx Corporation (FedEx Express) (Memphis)ย reported earnings of $1.53 per diluted share for the first quarter ended August 31, compared to $1.45 per share last year.
โGrowth in overall demand for our broad global portfolio of solutions drove our improved first quarter results,โ said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer. โFedEx Express remains focused on reducing costs while facing challenging global economic conditions. Meanwhile, FedEx Ground continues to generate strong profitability on growing customer demand for its services.โ
First Quarter Results
FedEx Corp. reported the following consolidated results for the first quarter:
โข Revenue of $11.0 billion, up 2% from $10.8 billion the previous year
โข Operating income of $795 million, up 7% from $742 million last year
โข Operating margin of 7.2%, up from 6.9% the previous year
โข Net income of $489 million, up 7% from last yearโs $459 million
Revenue and earnings increased during the quarter, driven by solid performance at each of the companyโs transportation segments. Results include significant headwinds from the net year-over-year impact from the timing lag that exists between when fuel prices change and indexed fuel surcharges automatically adjust, as well as one fewer operating day.
Outlook
FedEx reaffirmed its forecast of full-year earnings per share growth of 7% to 13% from last yearโs adjusted results. This outlook assumes the market outlook for fuel prices, U.S. GDP growth of 2.1% and world GDP growth of 2.6%. The capital spending forecast for fiscal 2014 remains $4 billion.
โWe remain confident in our full year earnings outlook despite tepid global economic growth,โ said Alan B. Graf, Jr., FedEx Corp. executive vice president and chief financial officer. โFedEx Express continued to execute on its profit improvement initiatives during our first quarter. We remain focused and are committed to FedEx Express achieving its $1.6 billion operating profit improvement target by the end of fiscal 2016.โ
2014 Rate Increases
FedEx Express will increase shipping rates by an average of 3.9% for U.S. domestic, U.S. export and U.S. import services effective January 6, 2014. The FedEx Ground and FedEx SmartPost pricing changes for 2014 will be announced later this year. FedEx Freight implemented a 4.5% general rate increase on July 1, 2013.
Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 777-FS2 N852FD (msn 37723) approaches Anchorage International Airport for landing.
Qatar Airways (Doha) has officially launched the start of its three year partnership with FC Barcelona at an event held at Camp Nou.
The airline’s partnership with FCB took effect from July 1ย this year.
In attendance were leading representatives of both organizations, the CEO of Qatar Airways, Akbar Al-Baker, the President of FC Barcelona, Sandro Rosell and Vice President of FC Barcelona Economic and Strategy Area, Javier Faus.
Since its beginnings, FC Barcelona has been characterized by being not just a football organization, but also a powerful force for globalization, solidarity, integration and social cohesion. Qatar Airways fully identifies with these values, which is why this partnership between both organizations is much more than just a simple economic alliance. Furthermore, Qatar Airways’ partnership with FC Barcelona will help to position the airline in the world.
Qatar Airways will work with FC Barcelona to create joint initiatives and will especially focus on connecting with the club’s fans and also with underprivileged children to spread the love of the game to all corners of the globe.
A new FC Barcelona logojet is on the horizon.
Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 777-FDZ A7-BFD (msn 41427) of the cargo division of Qatar Airways taxies at Amsterdam.
LATAM Airlines Group (LAN Airlines and TAM Linhas Aereas) (Santago and Sao Paulo) reported it lost $330 million in the second quarter. The group was created last year with the merger of the two airlines. The group is struggling in Brazil with TAM due to a weakening Brazilian economy. TAM is cutting costs and reducing flights.
LATAM Airlines Group Fleet Plans (excerpt from the report):
Top Copyright Photo: Rodrigo Cozzato/AirlinersGallery.com. Sporting new Sharklets, Airbus A320-214 PR-MYY (msn 5591) taxies at the Sao Paulo (Guarulhos) hub.
LAN Airlines (Chile):ย
TAM Linhas Aereas:ย
Bottom Copyright Photo: Alvaro Romero/ModoCharlie.com. Boeing 777-F6N N772LA (msn 37708) arrives at the Santiago hub.
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