Tag Archives: UPS Airlines (UPS-Worldwide Services)

UPS Airlines takes delivery of its last Boeing 747-8F freighter

The last UPS 747 to be built, delivered April 9, 2022

UPS Airlines (Louisville) has take delivery of last Boeing 747-8F freighter.

The pictured N633UP (top) was handed over on April 9, 2022.

The freighter flew from Paine Field in Everett, WA to the Louisville base.

Top Copyright Photo: UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N633UP (msn 65774) PAE (Nick Dean). Image: 957209.

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UPS releases its 4Q and 2021 earnings

UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N625UP (msn 65782) ANC (Michael B. Ing). Image: 956657.

UPS released its financial results:

  • Consolidated Revenues of $27.8B, Up 11.5% from Last Year
  • Consolidated Operating Profit of $3.9B, Up 91.0% from Last Year; Up 37.7% on an Adjusted* Basis
  • Diluted EPS of $3.52; Adjusted Diluted EPS Up 35.0% Over Last Year to $3.59
  • UPS Board of Directors Declares Quarterly Dividend of $1.52, a Per-Share Increase of 49% Over the Prior Year

UPS announced fourth-quarter 2021 consolidated revenue of $27.8 billion, an 11.5% increase over the fourth quarter of 2020. Consolidated operating profit was $3.9 billion, up 91.0% compared to the fourth quarter of 2020, and up 37.7% on an adjusted basis. Diluted earnings per share were $3.52 for the quarter; adjusted diluted earnings per share were 35.0% above the same period in 2020.

For the fourth quarter of 2021, GAAP results include a total charge of $59 million, or $0.07 per diluted share, comprised of a non-cash, after-tax mark-to-market (MTM) pension charge of $14 million and after-tax transformation and other charges of $45 million.

“I want to thank all UPSers for their outstanding efforts throughout the holiday season and for once again delivering industry-leading service to our customers.” said Carol Tomé, UPS chief executive officer. “The execution of our strategy is delivering positive financial results and driving strong momentum as we move into 2022.”

2022 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.

UPS expects to deliver its 2023 consolidated revenue and operating margin targets one year early. For the full year 2022, the company expects consolidated revenue of about $102 billion, an adjusted operating margin of approximately 13.7% and adjusted return on invested capital to be above 30%.

The company is planning capital expenditures to be 5.4% of revenue or approximately $5.5 billion, dividend payments to be around $5.2 billion, subject to Board approval, and share repurchases to be at least $1.0 billion. The effective tax rate is expected to be around 23.0%.

Video:

Top Copyright Photo: UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N625UP (msn 65782) ANC (Michael B. Ing). Image: 956657.

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UPS orders an additional 19 Boeing 767-300F freighters

UPS Airlines (UPS-Worldwide Services) Boeing 767-34AF ER N313UP (msn 27764) OSL (Ton Jochems). Image: 956207.

Boeing today announced an order for 19 767 Freighters from UPS highlighting the 767 Freighter’s outstanding operational efficiency and payload capability to serve its customers at a time of robust air cargo demand.

The deal adds to a record-breaking year for Boeing freighter sales, including 80 firm orders for new widebody freighters and more than 80 orders for Boeing Converted Freighters. In 2021 air cargo demand has surged due to an expansion of e-commerce and express cargo markets.

Based on the 767-300ER (Extended Range) passenger jet, the 767 Freighter carries up to 52.4 tons of revenue cargo with intercontinental range, serving as a flexible platform for long-haul, regional and feeder markets. UPS was the launch customer for the 767 Freighter in 1995, and since then has ordered a total of 91 of the aircraft. The carrier currently operates 236 Boeing freighters including the 747, 757, 767 and MD-11.

Top Copyright Photo: UPS Airlines (UPS-Worldwide Services) Boeing 767-34AF ER N313UP (msn 27764) OSL (Ton Jochems). Image: 956207.

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UPS releases its first quarter 2021 earnings

 

UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N626UP (msn 65781) PAE (Nick Dean). Image: 952877.

  • Consolidated Revenue Increased 27%; Growth Across All Segments
  • Consolidated Operating Profit Up 158% to $2.8B, Up 164% on an Adjusted* Basis
  • Diluted EPS of $5.47; Adjusted Diluted EPS Up 141% to $2.77

UPS has announced first-quarter 2021 consolidated revenue of $22.9 billion, a 27% increase over the first quarter of 2020. Consolidated average daily volume increased 14.3% year over year. Consolidated operating profit was $2.8 billion, up 158% compared to the first quarter of 2020, and up 164% on an adjusted basis. Diluted earnings per share were $5.47 for the quarter, 393% above the same period in 2020, and up 141% on an adjusted basis.

For the first-quarter of 2021, GAAP results include a net benefit of $2.4 billion, or $2.70 per diluted share, comprised of an after-tax mark-to-market (MTM) pension benefit of $2.5 billion and after-tax transformation and other charges of $140 million. The MTM benefit was primarily driven by the enactment of the American Rescue Plan Act of 2021 (ARPA). The ARPA, which was signed into law on March 11, 2021, protects certain multi-employer pension plans from becoming insolvent through 2051, thereby eliminating the Company’s liability for potential coordinating benefits related to the Central States Pension Fund. Enactment of the ARPA required the Company to remeasure its UPS IBT Pension plan at current discount rates, which have increased since the previous measurement date. The overall result was a reduction in the pension liability of $6.4 billion.

“I want to thank all UPSers for delivering what matters, including COVID-19 vaccines,” said Carol Tomé, UPS chief executive officer. “During the quarter, we continued to execute our strategy under the better not bigger framework, which enabled us to win the best opportunities in the market and drove record financial results.”

U.S. Domestic Segment

   

1Q 2021

Adjusted

1Q 2021

 

1Q 2020

Adjusted 

1Q 2020

Revenue $14,010 M   $11,456 M  
Operating profit $1,359 M $1,463 M $364 M $401 M
  • Revenue increased 22.3%, led by growth from small and medium-sized businesses.
  • Revenue per piece increased 10.2%, driven by Ground products.
  • Operating margin was 9.7%; adjusted operating margin was 10.4%.

 

International Segment

   

1Q 2021

Adjusted

1Q 2021

 

1Q 2020

Adjusted

1Q 2020

Revenue $4,607 M   $3,383 M  
Operating profit $1,085 M $1,091 M $551 M $558 M
  • Average daily volume grew 23.1%, with export growth from all regions.
  • Revenue increased 36.2%, led by Asia and Europe.
  • Operating margin was 23.6%; adjusted operating margin was 23.7%.

 

Supply Chain and Freight Segment

   

1Q 2021

Adjusted

1Q 2021

 

1Q 2020

Adjusted

1Q 2020

Revenue $4,291 M   $3,196 M  
Operating profit $321 M $395 M $157 M $158 M
  • Revenue increased 34.3%, driven by strong demand in nearly all businesses.
  • Operating margin was 7.5%; adjusted operating margin was 9.2%.

* “Adjusted” amounts are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial measures, including a reconciliation to the most closely correlated GAAP measure.

Outlook

Given continued economic uncertainty, the Company is not providing 2021 revenue or diluted earnings per share guidance; however, it is re-affirming its full-year capital allocation plans. UPS has scheduled its 2021 Investor and Analyst Day for June 9, when it will share further financial details.

Reaffirms Full-Year 2021 Capital Allocation Plans

  • The sale of UPS Freight is expected to close in the second quarter.
  • Capital expenditures are planned to be about $4.0 billion.
  • Long-term debt repayments, including $1.5 billion repaid in the first quarter of 2021, will total $2.5 billion.
  • Effective tax rate for the remainder of the year is expected to be around 23.5%.
  • The Company has no plans to repurchase shares.

Top Copyright Photo: UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N626UP (msn 65781) PAE (Nick Dean). Image: 952877.

UP Airlines aircraft slide show:

 

UPS Air Cargo Teamsters ratify contract

The Teamsters issued this statement:

UPS Airlines aircraft mechanics and related employees at UPS Air Cargo have voted to ratify their newest contract with the company. The contract, which becomes amendable on November 1, 2023, makes UPS Air Cargo mechanics the highest-paid air cargo mechanics in the country by a wide margin.

Some of the improvements in the contract include an immediate 17.72 percent pay increase, raises each year resulting in a 32.61 percent increase in pay from current rates by the end of the contract and the protection of an unparalleled health care package with no premiums.

 

UPS Airlines receives a special gift from Boeing

UPS Airlines on social media made this announcement:

During delivery of our latest Boeing 747-8F (above), Boeing presented us with this amazing gift (below) – a cutout from a retired Boeing 747 fuselage, with pictures of each UPS Airlines aircraft type, delivered new from Boeing over the last 30 years. Wow! Thank you.

All photos by 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.

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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 launches a nonstop Louisville – Dubai flight, its longest route

UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N607UP (msn 64265) PAE (Nick Dean). Image: 939436.

UPS Airlines is launching a daily nonstop flight from its Worldport® global air hub in Louisville, KY., to Dubai, UAE, improving time-in-transit from North and South America to key destinations in the Middle East by a full business day. The flight, operated with one of UPS’s new Boeing 747-8F freighters, is part of the build out of UPS’s smart global logistics network and takes place as the company plans for its role as official logistics provider for Expo 2020 Dubai.

At approximately 7,700 miles (12,400 km), the route is the longest regularly-scheduled flight UPS has ever operated, and is made possible by the new 747-8s, which offer greater payload over long range. The new flight is currently operating on a weekly basis and will become a daily flight on February 27, operating Tuesday through Saturday. The new flight is part of plans to expand UPS’s presence in Dubai, the headquarters of UPS’s Indian Subcontinent Middle East & Africa (ISMEA) region, by establishing capacity, technology and staff capabilities to serve customers shipping to and through Dubai in the buildup to Expo 2020 and beyond. UPS has been operating in the region since 1989.

The Louisville-Dubai flight leg is part of an “around-the-world” flight route that begins and ends at UPS Worldport in Louisville, KY.  For the volume from North and South America that passes through Worldport, there is a full day time-in-transit improvement to Dubai. After arriving in Dubai, new package and freight volume is loaded onboard the aircraft before it departs for Shenzhen, China, home to UPS’ largest facility in Asia. U.S.-bound volume is then loaded in Shenzhen and the aircraft returns to Worldport via Anchorage, AK. With the addition of this new flight, the volume capacity on UPS’s current Cologne to Dubai flight increases to better serve the needs of customers connecting Europe to the Indian Subcontinent, Middle East and Africa.

Copyright Photo: UPS Airlines (UPS-Worldwide Services) Boeing 747-8F N607UP (msn 64265) PAE (Nick Dean). Image: 939436.

UPS aircraft slide show: