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Condensed Consolidating Financial Statements
 3 Months Ended
Aug. 31, 2016
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.

 

The guarantor subsidiaries, which are wholly owned by FedEx, guarantee $13.6 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.

 

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, 2016
                   
        Guarantor Non-guarantor    
     Parent Subsidiaries Subsidiaries Eliminations Consolidated
ASSETS              
CURRENT ASSETS              
 Cash and cash equivalents$ 1,308 $ 327 $ 1,391 $ (37) $ 2,989
 Receivables, less allowances  1   4,517   2,760   (45)   7,233
 Spare parts, supplies, fuel, prepaid expenses              
  and other, less allowances  74   839   266   -   1,179
   Total current assets  1,383   5,683   4,417   (82)   11,401
                   
PROPERTY AND EQUIPMENT, AT COST  22   44,777   3,322   -   48,121
 Less accumulated depreciation and amortization  17   22,061   1,239   -   23,317
   Net property and equipment  5   22,716   2,083   -   24,804
                   
INTERCOMPANY RECEIVABLE  2,747   1,177   -   (3,924)   -
GOODWILL  -   1,571   5,212   -   6,783
INVESTMENT IN SUBSIDIARIES  25,493   3,758   -   (29,251)   -
OTHER ASSETS  3,398   858   1,580   (3,249)   2,587
                   
     $ 33,026 $ 35,763 $ 13,292 $ (36,506) $ 45,575
                   
LIABILITIES AND STOCKHOLDERS' INVESTMENT            
CURRENT LIABILITIES              
 Current portion of long-term debt$ - $ 29 $ 18 $ - $ 47
 Accrued salaries and employee benefits  38   1,115   450   -   1,603
 Accounts payable  111   1,334   1,488   (82)   2,851
 Accrued expenses  877   1,368   728   -   2,973
  Total current liabilities  1,026   3,846   2,684   (82)   7,474
                   
LONG-TERM DEBT, LESS CURRENT PORTION  13,458   245   32   -   13,735
INTERCOMPANY PAYABLE  -   -   3,924   (3,924)   -
OTHER LONG-TERM LIABILITIES              
 Deferred income taxes  -   4,645   366   (3,249)   1,762
 Other liabilities  4,400   3,420   642   -   8,462
  Total other long-term liabilities  4,400   8,065   1,008   (3,249)   10,224
                   
STOCKHOLDERS' INVESTMENT  14,142   23,607   5,644   (29,251)   14,142
                   
     $ 33,026 $ 35,763 $ 13,292 $ (36,506) $ 45,575

CONDENSED CONSOLIDATING BALANCE SHEETS
May 31, 2016
                   
        Guarantor Non-guarantor    
     Parent Subsidiaries Subsidiaries Eliminations Consolidated
ASSETS              
CURRENT ASSETS              
 Cash and cash equivalents$ 1,974 $ 326 $ 1,277 $ (43) $ 3,534
 Receivables, less allowances  1   4,461   2,831   (41)   7,252
 Spare parts, supplies, fuel, prepaid expenses              
  and other, less allowances  233   724   246   -   1,203
   Total current assets  2,208   5,511   4,354   (84)   11,989
                   
PROPERTY AND EQUIPMENT, AT COST  22   43,760   3,236   -   47,018
 Less accumulated depreciation and amortization  17   21,566   1,151   -   22,734
   Net property and equipment  5   22,194   2,085   -   24,284
                   
INTERCOMPANY RECEIVABLE  2,437   1,284   -   (3,721)   -
GOODWILL  -   1,571   5,176   -   6,747
INVESTMENT IN SUBSIDIARIES  24,766   3,697   -   (28,463)   -
OTHER ASSETS  3,359   967   1,851   (3,238)   2,939
                   
     $ 32,775 $ 35,224 $ 13,466 $ (35,506) $ 45,959
                   
LIABILITIES AND STOCKHOLDERS' INVESTMENT            
CURRENT LIABILITIES              
 Current portion of long-term debt$ - $ 13 $ 16 $ - $ 29
 Accrued salaries and employee benefits  54   1,377   541   -   1,972
 Accounts payable  8   1,501   1,519   (84)   2,944
 Accrued expenses  883   1,411   769   -   3,063
  Total current liabilities  945   4,302   2,845   (84)   8,008
                   
LONG-TERM DEBT, LESS CURRENT PORTION  13,451   245   37   -   13,733
INTERCOMPANY PAYABLE  -   -   3,721   (3,721)   -
OTHER LONG-TERM LIABILITIES              
 Deferred income taxes  -   4,436   369   (3,238)   1,567
 Other liabilities  4,595   3,375   897   -   8,867
  Total other long-term liabilities  4,595   7,811   1,266   (3,238)   10,434
                   
STOCKHOLDERS' INVESTMENT  13,784   22,866   5,597   (28,463)   13,784
                   
     $ 32,775 $ 35,224 $ 13,466 $ (35,506) $ 45,959
                   

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
Three Months Ended August 31, 2016
                   
        Guarantor Non-guarantor    
     Parent Subsidiaries Subsidiaries Eliminations Consolidated
                   
REVENUES$ - $ 10,903 $ 3,830 $ (70) $ 14,663
               
OPERATING EXPENSES:              
 Salaries and employee benefits  36   4,106   1,169   -   5,311
 Purchased transportation  -   1,917   1,351   (28)   3,240
 Rentals and landing fees  1   620   170   (1)   790
 Depreciation and amortization  -   611   128   -   739
 Fuel  -   578   72   -   650
 Maintenance and repairs  -   526   72   -   598
 Intercompany charges, net  (90)   62   28   -   -
 Other  53   1,373   686   (41)   2,071
      -   9,793   3,676   (70)   13,399
                   
OPERATING INCOME  -   1,110   154   -   1,264
                   
OTHER INCOME (EXPENSE):              
 Equity in earnings of subsidiaries  715   56   -   (771)   -
 Interest, net  (122)   9   -   -   (113)
 Intercompany charges, net  122   (81)   (41)   -   -
 Other, net  -   (5)   (4)   -   (9)
                   
INCOME BEFORE INCOME TAXES  715   1,089   109   (771)   1,142
                   
 Provision for income taxes  -   380   47   -   427
                   
NET INCOME$ 715 $ 709 $ 62 $ (771) $ 715
                   
COMPREHENSIVE INCOME$ 696 $ 702 $ 81 $ (771) $ 708
                   
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 CASH FLOWS
(UNAUDITED)
Three Months Ended August 31, 2016
                   
        Guarantor Non-guarantor    
     Parent Subsidiaries Subsidiaries Eliminations Consolidated
                   
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES$ (342) $ 1,119 $ 188 $ 6 $ 971
               
INVESTING ACTIVITIES              
 Capital expenditures  -   (1,111)   (104)   -   (1,215)
 Proceeds from asset dispositions and other  -   9   -   -   9
                   
CASH USED IN INVESTING ACTIVITIES  -   (1,102)   (104)   -   (1,206)
                   
FINANCING ACTIVITIES              
 Net transfers from (to) Parent  (35)   (2)   37   -   -
 Payment on loan between subsidiaries  (2)   (14)   16   -   -
 Principal payments on debt  -   (7)   (5)   -   (12)
 Proceeds from stock issuances  40   -   -   -   40
 Excess tax benefit on the exercise of stock options  2   -   -   -   2
 Dividends paid  (106)   -   -   -   (106)
 Purchase of treasury stock  (222)   -   -   -   (222)
 Other, net  (1)   (1)   (13)   -   (15)
                   
CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES  (324)   (24)   35   -   (313)
                   
Effect of exchange rate changes on cash  -   8   (5)   -   3
Net (decrease) increase in cash and cash equivalents  (666)   1   114   6   (545)
Cash and cash equivalents at beginning of period  1,974   326   1,277   (43)   3,534
                   
Cash and cash equivalents at end of period$ 1,308 $ 327 $ 1,391 $ (37) $ 2,989
                   
                   
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