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Condensed Consolidating Financial Statements
 3 Months Ended
Aug. 31, 2015
Condensed Consolidating Financial Statements [Abstract]  
Condensed Consolidating Financial Statements

(10) Condensed Consolidating Financial Statements

 

We are required to present condensed consolidating financial information in order for the subsidiary guarantors of our public debt to continue to be exempt from reporting under the Securities Exchange Act of 1934, as amended. FedEx Express, however, currently files reports under such act.

 

The guarantor subsidiaries, which are wholly owned by FedEx, guarantee $7.0 billion of our debt. The guarantees are full and unconditional and joint and several. Our guarantor subsidiaries were not determined using geographic, service line or other similar criteria, and as a result, the "Guarantor Subsidiaries" and "Non-guarantor Subsidiaries" columns each include portions of our domestic and international operations. Accordingly, this basis of presentation is not intended to present our financial condition, results of operations or cash flows for any purpose other than to comply with the specific requirements for subsidiary guarantor reporting. Prior year amounts have been recast to conform to the pension accounting changes as discussed in our Annual Report.

 

Condensed consolidating financial statements for our guarantor subsidiaries and non-guarantor subsidiaries are presented in the following tables (in millions):

CONDENSED CONSOLIDATING BALANCE SHEETS
(UNAUDITED)
August 31, 2015
                   
        Guarantor Non-guarantor    
     Parent Subsidiaries Subsidiaries Eliminations Consolidated
ASSETS              
CURRENT ASSETS              
 Cash and cash equivalents$ 2,224 $ 446 $ 917 $ (44) $ 3,543
 Receivables, less allowances  1   4,308   1,349   (41)   5,617
 Spare parts, supplies, fuel, prepaid expenses              
  and other, less allowances  25   777   135   -   937
 Deferred income taxes  -   572   34   -   606
   Total current assets  2,250   6,103   2,435   (85)   10,703
                   
PROPERTY AND EQUIPMENT, AT COST  29   41,521   2,439   -   43,989
 Less accumulated depreciation and amortization  23   21,202   1,281   -   22,506
   Net property and equipment  6   20,319   1,158   -   21,483
                   
INTERCOMPANY RECEIVABLE  -   533   1,695   (2,228)   -
GOODWILL  -   1,551   2,241   -   3,792
INVESTMENT IN SUBSIDIARIES  23,722   3,817   -   (27,539)   -
OTHER ASSETS  2,761   781   416   (2,691)   1,267
                   
     $ 28,739 $ 33,104 $ 7,945 $ (32,543) $ 37,245
                   
LIABILITIES AND STOCKHOLDERS' INVESTMENT            
CURRENT LIABILITIES              
 Current portion of long-term debt$ - $ 6 $ 8 $ - $ 14
 Accrued salaries and employee benefits  44   1,133   178   -   1,355
 Accounts payable  77   1,326   731   (85)   2,049
 Accrued expenses  745   1,400   281   -   2,426
  Total current liabilities  866   3,865   1,198   (85)   5,844
                   
LONG-TERM DEBT, LESS CURRENT PORTION  6,978   248   18   -   7,244
INTERCOMPANY PAYABLE  2,228   -   -   (2,228)   -
OTHER LONG-TERM LIABILITIES              
 Deferred income taxes  -   4,237   235   (2,691)   1,781
 Other liabilities  3,384   3,446   263   -   7,093
  Total other long-term liabilities  3,384   7,683   498   (2,691)   8,874
                   
STOCKHOLDERS' INVESTMENT  15,283   21,308   6,231   (27,539)   15,283
                   
     $ 28,739 $ 33,104 $ 7,945 $ (32,543) $ 37,245

CONDENSED CONSOLIDATING BALANCE SHEETS
May 31, 2015
                   
        Guarantor Non-guarantor    
     Parent Subsidiaries Subsidiaries Eliminations Consolidated
ASSETS              
CURRENT ASSETS              
 Cash and cash equivalents$ 2,383 $ 487 $ 971 $ (78) $ 3,763
 Receivables, less allowances  3   4,383   1,385   (52)   5,719
 Spare parts, supplies, fuel, prepaid expenses              
  and other, less allowances  41   689   123   -   853
 Deferred income taxes  -   571   35   -   606
   Total current assets  2,427   6,130   2,514   (130)   10,941
                   
PROPERTY AND EQUIPMENT, AT COST  29   40,364   2,471   -   42,864
 Less accumulated depreciation and amortization  23   20,685   1,281   -   21,989
   Net property and equipment  6   19,679   1,190   -   20,875
                   
INTERCOMPANY RECEIVABLE  -   686   1,563   (2,249)   -
GOODWILL  -   1,552   2,258   -   3,810
INVESTMENT IN SUBSIDIARIES  23,173   3,800   -   (26,973)   -
OTHER ASSETS  2,752   898   477   (2,684)   1,443
                   
     $ 28,358 $ 32,745 $ 8,002 $ (32,036) $ 37,069
                   
LIABILITIES AND STOCKHOLDERS' INVESTMENT            
CURRENT LIABILITIES              
 Current portion of long-term debt$ - $ 7 $ 12 $ - $ 19
 Accrued salaries and employee benefits  34   1,208   194   -   1,436
 Accounts payable  5   1,433   758   (130)   2,066
 Accrued expenses  604   1,557   275   -   2,436
  Total current liabilities  643   4,205   1,239   (130)   5,957
                   
LONG-TERM DEBT, LESS CURRENT PORTION  6,978   248   23   -   7,249
INTERCOMPANY PAYABLE  2,249   -   -   (2,249)   -
OTHER LONG-TERM LIABILITIES              
 Deferred income taxes  -   4,206   225   (2,684)   1,747
 Other liabilities  3,495   3,367   261   -   7,123
  Total other long-term liabilities  3,495   7,573   486   (2,684)   8,870
                   
STOCKHOLDERS' INVESTMENT  14,993   20,719   6,254   (26,973)   14,993
                   
     $ 28,358 $ 32,745 $ 8,002 $ (32,036) $ 37,069
                   

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
Three Months Ended August 31, 2015
                   
        Guarantor Non-guarantor    
     Parent Subsidiaries Subsidiaries Eliminations Consolidated
                   
REVENUES$ - $ 9,873 $ 2,509 $ (103) $ 12,279
               
OPERATING EXPENSES:              
 Salaries and employee benefits  34   3,813   678   -   4,525
 Purchased transportation  -   1,434   965   (55)   2,344
 Rentals and landing fees  1   587   108   (1)   695
 Depreciation and amortization  -   583   65   -   648
 Fuel  -   691   21   -   712
 Maintenance and repairs  -   508   40   -   548
 Intercompany charges, net  (69)   (40)   109   -   -
 Other  34   1,264   412   (47)   1,663
      -   8,840   2,398   (103)   11,135
                   
OPERATING INCOME  -   1,033   111   -   1,144
                   
OTHER INCOME (EXPENSE):              
 Equity in earnings of subsidiaries  692   61   -   (753)   -
 Interest, net  (75)   8   4   -   (63)
 Intercompany charges, net  78   (76)   (2)   -   -
 Other, net  (3)   (3)   9   -   3
                   
INCOME BEFORE INCOME TAXES  692   1,023   122   (753)   1,084
                   
 Provision for income taxes  -   357   35   -   392
                   
NET INCOME$ 692 $ 666 $ 87 $ (753) $ 692
                   
COMPREHENSIVE INCOME$ 674 $ 651 $ (42) $ (753) $ 530
                   
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
Three Months Ended August 31, 2014
(As Adjusted)
                   
        Guarantor Non-guarantor    
     Parent Subsidiaries Subsidiaries Eliminations Consolidated
                   
REVENUES$ - $ 9,769 $ 2,004 $ (89) $ 11,684
               
OPERATING EXPENSES:              
 Salaries and employee benefits  30   3,534   550   -   4,114
 Purchased transportation  -   1,386   711   (43)   2,054
 Rentals and landing fees  1   572   88   (1)   660
 Depreciation and amortization  -   595   56   -   651
 Fuel  -   1,095   25   -   1,120
 Maintenance and repairs  -   522   34   -   556
 Intercompany charges, net  (95)   2   93   -   -
 Other  64   1,165   283   (45)   1,467
      -   8,871   1,840   (89)   10,622
                   
OPERATING INCOME  -   898   164   -   1,062
                   
OTHER INCOME (EXPENSE):              
 Equity in earnings of subsidiaries  653   98   -   (751)   -
 Interest, net  (53)   4   1   -   (48)
 Intercompany charges, net  54   (59)   5   -   -
 Other, net  (1)   (3)   2   -   (2)
                   
INCOME BEFORE INCOME TAXES  653   938   172   (751)   1,012
                   
 Provision for income taxes  -   296   63   -   359
                   
NET INCOME$ 653 $ 642 $ 109 $ (751) $ 653
                   
COMPREHENSIVE INCOME$ 636 $ 638 $ 83 $ (751) $ 606

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended August 31, 2015
                   
        Guarantor Non-guarantor    
     Parent Subsidiaries Subsidiaries Eliminations Consolidated
                   
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES$ (397) $ 1,533 $ 71 $ 34 $ 1,241
               
INVESTING ACTIVITIES              
 Capital expenditures  -   (1,170)   (39)   -   (1,209)
 Proceeds from asset dispositions and other  (5)   15   -   -   10
                   
CASH USED IN INVESTING ACTIVITIES  (5)   (1,155)   (39)   -   (1,199)
                   
FINANCING ACTIVITIES              
 Net transfers from (to) Parent  452   (479)   27   -   -
 Payment on loan between subsidiaries  -   98   (98)   -   -
 Intercompany dividends  -   4   (4)   -   -
 Principal payments on debt  -   (2)   (13)   -   (15)
 Proceeds from stock issuances  46   -   -   -   46
 Excess tax benefit on the exercise of stock options  6   -   -   -   6
 Dividends paid  (71)   -   -   -   (71)
 Purchase of treasury stock  (190)   -   -   -   (190)
 Other, net  -   (25)   25   -   -
                   
CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES  243   (404)   (63)   -   (224)
                   
Effect of exchange rate changes on cash  -   (15)   (23)   -   (38)
Net (decrease) increase in cash and cash equivalents  (159)   (41)   (54)   34   (220)
Cash and cash equivalents at beginning of period  2,383   487   971   (78)   3,763
                   
Cash and cash equivalents at end of period$ 2,224 $ 446 $ 917 $ (44) $ 3,543
                   
                   
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended August 31, 2014
                   
        Guarantor Non-guarantor    
     Parent Subsidiaries Subsidiaries Eliminations Consolidated
                   
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES$ (67) $ 934 $ 105 $ 10 $ 982
               
INVESTING ACTIVITIES              
 Capital expenditures  (1)   (688)   (31)   -   (720)
 Proceeds from asset dispositions and other  -   7   (3)   -   4
                   
CASH USED IN INVESTING ACTIVITIES  (1)   (681)   (34)   -   (716)
                   
FINANCING ACTIVITIES              
 Net transfers from (to) Parent  358   (366)   8   -   -
 Payment on loan between subsidiaries  -   103   (103)   -   -
 Intercompany dividends  -   2   (2)   -   -
 Proceeds from stock issuances  97   -   -   -   97
 Excess tax benefit on the exercise of stock options  10   -   -   -   10
 Dividends paid  (57)   -   -   -   (57)
 Purchase of treasury stock  (791)   -   -   -   (791)
 Other, net  -   (1)   1   -   -
                   
CASH USED IN FINANCING ACTIVITIES  (383)   (262)   (96)   -   (741)
                   
Effect of exchange rate changes on cash  -   (2)   (15)   -   (17)
Net (decrease) increase in cash and cash equivalents  (451)   (11)   (40)   10   (492)
Cash and cash equivalents at beginning of period  1,756   441   861   (150)   2,908
                   
Cash and cash equivalents at end of period$ 1,305 $ 430 $ 821 $ (140) $ 2,416