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FedEx Q4 earnings $2.66 per diluted share

Staff writer |
FedEx reported adjusted earnings of $2.66 per diluted share for the fourth quarter ended May 31, compared to adjusted earnings of $2.54 per diluted share a year ago.

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For fiscal 2015, adjusted earnings were $8.95 per diluted share, compared to $7.05 per diluted share a year ago. Without adjustments, FedEx reported a loss of $3.16 per diluted share for the fourth quarter compared to a profit of $2.62 per diluted share a year ago, and earnings of $3.65 per diluted share for the full fiscal year, compared to $7.48 per diluted share last year.

Quarterly consolidated earnings have been adjusted for previously announced changes in pension accounting ($4.88 per diluted share), aircraft impairments ($0.62 per diluted share), a legal reserve increase ($0.47 per diluted share) and changes in segment reporting (favorable $0.15 per diluted share).

Adjusted operating income improved 5% during the quarter, due to base yield growth in all three transportation segments, higher ground and U.S. domestic express volume, and benefits from profit improvement program initiatives. These improvements offset increased employee variable incentive compensation and unfavorable net impacts from fuel and weather.

Adjusted operating results increased sharply during the year due to higher volumes and base yields in all three transportation segments, benefits from profit improvement program initiatives and a favorable net fuel impact. This was partially offset by increased incentive compensation and higher aircraft maintenance expense.

For fiscal 2016, FedEx projects adjusted earnings to be $10.60 to $11.10 per diluted share before year-end mark-to-market pension accounting adjustments, driven by continued improvement in base pricing and benefits from our profit improvement program. The outlook assumes continued moderate economic growth and does not include any operating results or costs related to TNT Express.

Capital spending for fiscal 2016 is expected to be approximately $4.6 billion, which includes expansion of the FedEx Ground network and planned aircraft deliveries to support the FedEx Express fleet modernization program.


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