Federal Express Earnings...Oh No! No Green Shoots!

Press Release Source: FedEx Corp. On Wednesday June 16, 2010, 7:45 am

MEMPHIS, Tenn.--(BUSINESS WIRE)--FedEx Corp. (NYSE: FDX - News) today reported earnings of $1.33 per diluted share for the fourth quarter ended May 31. Last year, the company reported a fourth quarter loss of $2.82 per diluted share, including $3.46 per diluted share of charges resulting primarily from the impairment of goodwill and aircraft. Excluding these charges, fourth quarter earnings were $0.64 per diluted share a year ago.

“FedEx delivered strong results in our fourth quarter, thanks to sequential growth in package volume and our ability to leverage our unique global networks to take advantage of a recovering economy,” said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer. “We ended our fiscal year a stronger company, and I am confident FedEx is very well positioned for future revenue and earnings growth.”

Full Year Results

FedEx Corp. reported the following consolidated results for the full year:
•Revenue of $34.7 billion, down 2% from $35.5 billion the previous year
•Operating income of $2.0 billion, up from $747 million last year
•Net income of $1.18 billion, up from last year’s $98 million
•Earnings per share of $3.76, up from $0.31 per share a year ago ($3.76 per share excluding the impact of impairment and other charges)

Outlook:

FedEx projects earnings to be $0.85 to $1.05 per diluted share in the first quarter and $4.40 to $5.00 per diluted share for fiscal 2011. This guidance assumes the current market outlook for fuel prices and a continued moderate recovery in the global economy. The company reported earnings of $0.58 per diluted share in last year’s first quarter. The capital spending forecast for fiscal 2011 is $3.2 billion, which includes the expected delivery of six Boeing 777Fs and 16 Boeing 757s, along with investments in information technology, vehicles and facilities in support of the company’s global growth strategy.


Grandpa:Concensus Earnings Estimate from the brightest minds on Wall Street for 2011 is $5.06 per share.This is an OUCH!!!!! Given the company's guidance, FDX could miss by 10+%. Even if they hit their top end estimate, it remains a miss. At 7:00 am CDT, CNBC is already putting on a "happy face" and they will likely burn up a dozen tubes of lipstick by the open.