Skip to content
Search AI Powered

Latest Stories

newsworthy

International services power UPS to strong fourth-quarter profits

Strength in high-margin international parcel business offset weakness in transport giant's supply chain and freight segments.

UPS Inc., powered by strong results from its international operations, today reported a fourth-quarter operating profit of $1.26 billion, well above the $803 million in profits in the fourth quarter of 2008. UPS's earnings per share came in at 75 cents, at the high end of the range it had projected several weeks back.

UPS's strong numbers came in spite of weakness in its supply chain and freight businesses. UPS's freight forwarding operating margins were squeezed by rapidly rising transportation costs that resulted from a surge in Asian demand that outstripped available capacity. The company's less-than-truckload (LTL) business reported a loss for the quarter due to what it called an "extremely competitive" pricing environment. LTL shipment growth was flat, while tonnage declined in the quarter, UPS said. The company does not publicly break out profit and loss figures for its LTL operations.


For UPS, international was the fourth-quarter standout. Revenue rose 5.8 percent over 2008 levels, with average daily volumes growing by 11.8 percent. UPS reported an international operating margin of 16.7 percent, its highest margin since the fourth quarter of 2007.

For the quarter, UPS reported revenue of $12.38 billion, down from $12.70 billion in the same period in 2008. Its domestic package business, which accounts for nearly 60 percent of overall revenue, posted revenue of $7.55 billion, down from nearly $8 billion in the year-earlier quarter.

"UPS ended 2009 on a high note by leveraging network changes implemented throughout the year and executing flawlessly during the peak holiday shipping period, which was stronger than we had anticipated," said UPS Chairman and CEO Scott Davis in a statement.

Nonetheless, company officials remained cautious about the prospects for 2010. "Economic forecasts indicate gradual improvement as 2010 unfolds," said Kurt Kuehn, UPS's chief financial officer. Kuehn said the first quarter will be the "most challenging of the year" with profitability only slightly better than the first quarter of 2009.

Kuehn said UPS will invest $1.8 billion in capital expenditures in 2010, well below its historical averages. From 2006 to 2008, the company invested between $2.6 billion and $3 billion each year on capital expenditures.

The Latest

More Stories

Trucking industry experiences record-high congestion costs

Trucking industry experiences record-high congestion costs

Congestion on U.S. highways is costing the trucking industry big, according to research from the American Transportation Research Institute (ATRI), released today.

The group found that traffic congestion on U.S. highways added $108.8 billion in costs to the trucking industry in 2022, a record high. The information comes from ATRI’s Cost of Congestion study, which is part of the organization’s ongoing highway performance measurement research.

Keep ReadingShow less

Featured

From pingpong diplomacy to supply chain diplomacy?

There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.

Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”

Keep ReadingShow less
forklift driving through warehouse

Hyster-Yale to expand domestic manufacturing

Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.

That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.

Keep ReadingShow less
map of truck routes in US

California moves a step closer to requiring EV sales only by 2035

Federal regulators today gave California a green light to tackle the remaining steps to finalize its plan to gradually shift new car sales in the state by 2035 to only zero-emissions models — meaning battery-electric, hydrogen fuel cell, and plug-in hybrid cars — known as the Advanced Clean Cars II Rule.

In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.

Keep ReadingShow less
chart of global trade forecast

Tariff threat pours cold water on global trade forecast

Global trade will see a moderate rebound in 2025, likely growing by 3.6% in volume terms, helped by companies restocking and households renewing purchases of durable goods while reducing spending on services, according to a forecast from trade credit insurer Allianz Trade.

The end of the year for 2024 will also likely be supported by companies rushing to ship goods in anticipation of the higher tariffs likely to be imposed by the coming Trump administration, and other potential disruptions in the coming quarters, the report said.

Keep ReadingShow less