Earnings Review and Free Research Report: FedEx’s Quarterly Revenue Surged 21%; Adjusted EPS Soared 29%

Research Desk Line-up: ModusLink Global Solutions Post Earnings Coverage

LONDON, UK / ACCESSWIRE / June 30, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on FedEx Corp. (NYSE: FDX), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=FDX, following the Company’s disclosure of its fourth quarter and fiscal 2017 financial results on June 21, 2017. The Air Delivery & Freight Services Company surpassed top- and bottom-line expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member’s account at: http://protraderdaily.com/register/.

Get more of our free earnings reports coverage from other constituents of the Air Delivery & Freight Services industry. Pro-TD has currently selected ModusLink Global Solutions, Inc. (NASDAQ: MLNK) for due-diligence and potential coverage as the Company announced on June 05, 2017, its financial results for Q3 FY17 which ended on April 30, 2017. Register for a free membership today, and be among the early birds that get access to our report on ModusLink Global Solutions when we publish it.

At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on FDX; also brushing on MLNK. With the links below you can directly download the report of your stock of interest free of charge at:

http://protraderdaily.com/optin/?symbol=FDX

http://protraderdaily.com/optin/?symbol=MLNK

Earnings Reviewed

For the three months ended May 31, 2017, FedEx’s revenue totaled $15.73 billion compared to revenue of $13.0 billion in Q4 FY16. The Company’s operating results benefited from higher base rates, increased package volume, and the inclusion of TNT Express results. FedEx’s revenue numbers surpassed analysts’ consensus of $15.56 billion.

For FY17, FedEx’s revenues totaled $60.3 billion compared to revenue of $50.4 billion in FY16.

During Q4 FY17, FedEx’s reported operating income came in at $1.58 billion compared to operating loss of $68 million in Q4 FY16. The Company’s adjusted operating income totaled $1.76 billion compared to $1.51 billion in the prior year’s same quarter. FedEx’s operating margin for Q4 FY17 was 10.1% versus negative operating margin of 0.5% in Q4 FY16. The Company’s adjusted operating margin totaled 11.2% against 11.7% in the year ago comparable period.

FedEx’s net income came in at $1.02 billion, or $3.75 per diluted share, for Q4 FY17 compared to net loss of 70 million, or $0.26 per diluted share, in Q4 FY16. Net income and earnings per share reflected tax benefits of $104 million, or $0.37 per diluted share related to the implementation of new foreign currency tax regulations, the adoption of a new accounting standard for share-based compensation, and certain transactions related to the TNT integration. The Company’s adjusted earnings totaled $4.25 per share compared to $3.30 per diluted share in the year ago same period, handily beating Wall Street’s estimates of $3.89 per share.

For FY17, FedEx’s net income came in at $3.00 billion, or $11.07 per diluted share, compared to $1.82 billion, or $6.51 per diluted share, in Q4 FY16. The Company’s adjusted earnings totaled $12.30 per share compared to $10.8 per dilutes share in the year ago same period.

Segment Results

During Q4 FY17, the Company’s FedEx Express segment generated revenue of $7.18 billion, up 7% compared to $6.72 billion in Q4 FY16. The increase was attributed to higher package volume driven by international export growth of 5% and superior base rates. In the reported quarter, the segment achieved record operating profit of $863 million, while adjusted operating margin climbed to 12.7%.

For Q4 FY17, FedEx’s TNT segment reported revenues of $1.91 billion with an adjusted operating profit of $83 million. The segment’s adjusted operating margin was 4.4%. Adjustments to operating income for the reported quarter included integration and restructuring expenses of $37 million as well as intangible asset amortization of $20 million. FedEx noted that starting the upcoming quarter, the Company will no longer report Express and TNT separately. Instead, it will report the combined results as one FedEx Express segment.

FedEx’s Ground segment reported revenue of $4.68 billion up 9% compared to revenue of $4.29 billion in Q4 FY16. Revenue increased primarily due to higher base rates and average daily package volume growth of 3%. The segment’s operating income grew 7% to $702 million while its operating margin was 15% in the reported quarter. The growth in operating income was attributed to higher yields and volume, partially offset by network expansion and staffing costs as well as increased self-insurance reserves.

During Q4 FY17, FedEx’s Freight segment’s revenue grew 6% on a y-o-y basis to $1.70 billion compared to revenue of $1.61 billion in Q4 FY16. Revenue increased primarily due to higher base rates and average daily package volume growth of 3%. The segment’s operating margin declined 0.7% on a y-o-y basis to 7.8%, due to higher salaries and wages and increased information technology expenses that offset the benefit from the higher base rates.

Outlook

FedEx stated that is unable to forecast fiscal 2018 year-end MTM pension accounting adjustments. As a result, the Company is unable to provide GAAP earnings guidance for FY18.

Before year-end MTM pension accounting adjustments, FedEx’s earnings are projected to be $12.45 to $13.25 per diluted share. The Company’s capital spending for fiscal 2018 is expected to be approximately $5.9 billion, which includes an increase in planned aircraft deliveries to support the FedEx Express fleet modernization program and continued investments in FedEx Ground automation and capacity expansion, including projects deferred from FY17.

FedEx noted that it is targeting operating income improvement at the new FedEx Express segment of $1.2 billion to $1.5 billion in FY20 versus FY17 assuming moderate economic growth as well as current accounting and tax rules.

Cash Matters

During FY17, FedEx’s capital expenditures were $5.1 billion, and several Ground network expansion projects were deferred into FY18 and beyond. The Company repurchased nearly 3 million shares in FY17 at an average price of $172.13. As of May 31, 2017, FedEx had approximately 16 million remaining shares authorized for repurchase.

Stock Performance

FedEx’s share price finished yesterday’s trading session at $215.23, slightly down 0.88%. A total volume of 1.57 million shares have exchanged hands. The Company’s stock price soared 10.85% in the last three months, 14.21% in the past six months, and 43.24% in the previous twelve months. Additionally, the stock surged 15.59% since the start of the year. Shares of the Company have a PE ratio of 19.41 and have a dividend yield of 0.93%. The stock currently has a market cap of $57.73 billion.

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