Delaware | 001-15451 | 58-2480149 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
55 Glenlake Parkway, N.E., Atlanta, Georgia | 30328 | |
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
UNITED PARCEL SERVICE, INC. | |||||||
Date: | July 29, 2016 | By: | /S/ RICHARD N. PERETZ | ||||
Richard N. Peretz | |||||||
Senior Vice President, Chief Financial Officer and Treasurer | |||||||
Contacts: | Steve Gaut, Public Relations |
404-828-8787 | |
Scott Childress, Investor Relations | |
404-828-7957 |
• | Positive Momentum Continues with 2Q EPS up 6% |
• | International Achieves 2Q Record as Operating Profit Climbs 11% |
• | U.S. Domestic and International Operating Margins Expand |
• | Higher International Exports Driven by Express Products |
• | Revenue Growth Tempered by Changes in Fuel and Currency |
• | Affirms Full-Year 2016 EPS Guidance of $5.70 to $5.90 |
Three Months Ended | |||||||||||
June 30 | |||||||||||
2016 | 2015 | Change | % Change | ||||||||
(amounts in millions, except per share data) | |||||||||||
Statement of Income Data: | |||||||||||
Revenue: | |||||||||||
U.S. Domestic Package | $ | 9,015 | $ | 8,808 | $ | 207 | 2.4 | % | |||
International Package | 3,077 | 3,045 | 32 | 1.1 | % | ||||||
Supply Chain & Freight | 2,537 | 2,242 | 295 | 13.2 | % | ||||||
Total revenue | 14,629 | 14,095 | 534 | 3.8 | % | ||||||
Operating expenses: | |||||||||||
Compensation and benefits | 7,738 | 7,502 | 236 | 3.1 | % | ||||||
Other | 4,853 | 4,633 | 220 | 4.7 | % | ||||||
Total operating expenses | 12,591 | 12,135 | 456 | 3.8 | % | ||||||
Operating profit: | |||||||||||
U.S. Domestic Package | 1,233 | 1,201 | 32 | 2.7 | % | ||||||
International Package | 613 | 552 | 61 | 11.1 | % | ||||||
Supply Chain & Freight | 192 | 207 | (15 | ) | (7.2 | )% | |||||
Total operating profit | 2,038 | 1,960 | 78 | 4.0 | % | ||||||
Other income (expense): | |||||||||||
Investment income | 8 | 4 | 4 | 100.0 | % | ||||||
Interest expense | (94 | ) | (86 | ) | (8 | ) | 9.3 | % | |||
Total other income (expense) | (86 | ) | (82 | ) | (4 | ) | 4.9 | % | |||
Income before income taxes | 1,952 | 1,878 | 74 | 3.9 | % | ||||||
Income tax expense | 683 | 648 | 35 | 5.4 | % | ||||||
Net income | $ | 1,269 | $ | 1,230 | $ | 39 | 3.2 | % | |||
Net income as a percentage of revenue | 8.7 | % | 8.7 | % | |||||||
Per share amounts: | |||||||||||
Basic earnings per share | $ | 1.43 | $ | 1.37 | $ | 0.06 | 4.4 | % | |||
Diluted earnings per share | $ | 1.43 | $ | 1.35 | $ | 0.08 | 5.9 | % | |||
Weighted-average shares outstanding: | |||||||||||
Basic | 886 | 901 | (15 | ) | (1.7 | )% | |||||
Diluted | 890 | 908 | (18 | ) | (2.0 | )% |
Three Months Ended | |||||||||||
June 30 | |||||||||||
2016 | 2015 | Change | % Change | ||||||||
Revenue (in millions): | |||||||||||
U.S. Domestic Package: | |||||||||||
Next Day Air | $ | 1,637 | $ | 1,591 | $ | 46 | 2.9 | % | |||
Deferred | 899 | 878 | 21 | 2.4 | % | ||||||
Ground | 6,479 | 6,339 | 140 | 2.2 | % | ||||||
Total U.S. Domestic Package | 9,015 | 8,808 | 207 | 2.4 | % | ||||||
International Package: | |||||||||||
Domestic | 621 | 600 | 21 | 3.5 | % | ||||||
Export | 2,326 | 2,283 | 43 | 1.9 | % | ||||||
Cargo and Other | 130 | 162 | (32 | ) | (19.8 | )% | |||||
Total International Package | 3,077 | 3,045 | 32 | 1.1 | % | ||||||
Supply Chain & Freight: | |||||||||||
Forwarding and Logistics | 1,659 | 1,319 | 340 | 25.8 | % | ||||||
Freight | 693 | 752 | (59 | ) | (7.8 | )% | |||||
Other | 185 | 171 | 14 | 8.2 | % | ||||||
Total Supply Chain & Freight | 2,537 | 2,242 | 295 | 13.2 | % | ||||||
Consolidated | $ | 14,629 | $ | 14,095 | $ | 534 | 3.8 | % | |||
Consolidated volume (in millions) | 1,132 | 1,101 | 31 | 2.8 | % | ||||||
Operating weekdays | 64 | 64 | — | — | % | ||||||
Average Daily Package Volume (in thousands): | |||||||||||
U.S. Domestic Package: | |||||||||||
Next Day Air | 1,311 | 1,241 | 70 | 5.6 | % | ||||||
Deferred | 1,129 | 1,132 | (3 | ) | (0.3 | )% | |||||
Ground | 12,489 | 12,192 | 297 | 2.4 | % | ||||||
Total U.S. Domestic Package | 14,929 | 14,565 | 364 | 2.5 | % | ||||||
International Package: | |||||||||||
Domestic | 1,599 | 1,530 | 69 | 4.5 | % | ||||||
Export | 1,159 | 1,115 | 44 | 3.9 | % | ||||||
Total International Package | 2,758 | 2,645 | 113 | 4.3 | % | ||||||
Consolidated | 17,687 | 17,210 | 477 | 2.8 | % | ||||||
Average Revenue Per Piece: | |||||||||||
U.S. Domestic Package: | |||||||||||
Next Day Air | $ | 19.51 | $ | 20.03 | $ | (0.52 | ) | (2.6 | )% | ||
Deferred | 12.44 | 12.12 | 0.32 | 2.6 | % | ||||||
Ground | 8.11 | 8.12 | (0.01 | ) | (0.1 | )% | |||||
Total U.S. Domestic Package | 9.44 | 9.45 | (0.01 | ) | (0.1 | )% | |||||
International Package: | |||||||||||
Domestic | 6.07 | 6.13 | (0.06 | ) | (1.0 | )% | |||||
Export | 31.36 | 31.99 | (0.63 | ) | (2.0 | )% | |||||
Total International Package | 16.70 | 17.03 | (0.33 | ) | (1.9 | )% | |||||
Consolidated | $ | 10.57 | $ | 10.61 | $ | (0.04 | ) | (0.4 | )% |
2016 Revenue Per Piece Adjusted to Reflect 2015 Currency Exchange Rates | |||||||||||||||||
Three Months Ended | |||||||||||||||||
June 30 | Adjusted | ||||||||||||||||
2016 | 2015 | % Change | Currency | 2016* | % Change | ||||||||||||
Average Revenue Per Piece: | |||||||||||||||||
International Package: | |||||||||||||||||
Domestic | $ | 6.07 | $ | 6.13 | (1.0 | )% | $ | 0.12 | $ | 6.19 | 1.0 | % | |||||
Export | 31.36 | 31.99 | (2.0 | )% | 0.05 | 31.41 | (1.8 | )% | |||||||||
Total International Package | $ | 16.70 | $ | 17.03 | (1.9 | )% | $ | 0.09 | $ | 16.79 | (1.4 | )% | |||||
Consolidated | $ | 10.57 | $ | 10.61 | (0.4 | )% | $ | 0.01 | $ | 10.58 | (0.3 | )% | |||||
* Adjusted amounts reflect impacts for currency exchange rate differences | |||||||||||||||||
2016 Revenue Adjusted to Reflect 2015 Currency Exchange Rates | |||||||||||||||||
Three Months Ended | |||||||||||||||||
June 30 | Adjusted | ||||||||||||||||
2016 | 2015 | % Change | Currency | 2016* | % Change | ||||||||||||
Revenue (in millions): | |||||||||||||||||
U.S. Domestic Package | $ | 9,015 | $ | 8,808 | 2.4 | % | — | $ | 9,015 | 2.4 | % | ||||||
International Package | 3,077 | 3,045 | 1.1 | % | 15 | 3,092 | 1.5 | % | |||||||||
Supply Chain & Freight | 2,537 | 2,242 | 13.2 | % | 9 | 2,546 | 13.6 | % | |||||||||
Total revenue | $ | 14,629 | $ | 14,095 | 3.8 | % | $ | 24 | $ | 14,653 | 4.0 | % | |||||
* Adjusted amounts reflect impacts for currency exchange rate differences |
Six Months Ended | |||||||||||
June 30 | |||||||||||
2016 | 2015 | Change | % Change | ||||||||
(amounts in millions, except per share data) | |||||||||||
Statement of Income Data: | |||||||||||
Revenue: | |||||||||||
U.S. Domestic Package | $ | 18,099 | $ | 17,622 | $ | 477 | 2.7 | % | |||
International Package | 5,991 | 6,015 | (24 | ) | (0.4 | )% | |||||
Supply Chain & Freight | 4,957 | 4,435 | 522 | 11.8 | % | ||||||
Total revenue | 29,047 | 28,072 | 975 | 3.5 | % | ||||||
Operating expenses: | |||||||||||
Compensation and benefits | 15,591 | 15,066 | 525 | 3.5 | % | ||||||
Other | 9,595 | 9,373 | 222 | 2.4 | % | ||||||
Total operating expenses | 25,186 | 24,439 | 747 | 3.1 | % | ||||||
Operating profit: | |||||||||||
U.S. Domestic Package | 2,335 | 2,225 | 110 | 4.9 | % | ||||||
International Package | 1,187 | 1,050 | 137 | 13.0 | % | ||||||
Supply Chain & Freight | 339 | 358 | (19 | ) | (5.3 | )% | |||||
Total operating profit | 3,861 | 3,633 | 228 | 6.3 | % | ||||||
Other income (expense): | |||||||||||
Investment income | 25 | 8 | 17 | NA | |||||||
Interest expense | (187 | ) | (173 | ) | (14 | ) | 8.1 | % | |||
Total other income (expense) | (162 | ) | (165 | ) | 3 | (1.8 | )% | ||||
Income before income taxes | 3,699 | 3,468 | 231 | 6.7 | % | ||||||
Income tax expense | 1,299 | 1,212 | 87 | 7.2 | % | ||||||
Net income | $ | 2,400 | $ | 2,256 | $ | 144 | 6.4 | % | |||
Net income as a percentage of revenue | 8.3 | % | 8.0 | % | |||||||
Per share amounts | |||||||||||
Basic earnings per share | $ | 2.71 | $ | 2.50 | $ | 0.21 | 8.4 | % | |||
Diluted earnings per share | $ | 2.69 | $ | 2.48 | $ | 0.21 | 8.5 | % | |||
Weighted-average shares outstanding | |||||||||||
Basic | 887 | 903 | (16 | ) | (1.8 | )% | |||||
Diluted | 892 | 911 | (19 | ) | (2.1 | )% |
Six Months Ended | |||||||||||
June 30 | |||||||||||
2016 | 2015 | Change | % Change | ||||||||
Revenue (in millions): | |||||||||||
U.S. Domestic Package: | |||||||||||
Next Day Air | $ | 3,212 | $ | 3,148 | $ | 64 | 2.0 | % | |||
Deferred | 1,814 | 1,774 | 40 | 2.3 | % | ||||||
Ground | 13,073 | 12,700 | 373 | 2.9 | % | ||||||
Total U.S. Domestic Package | 18,099 | 17,622 | 477 | 2.7 | % | ||||||
International Package: | |||||||||||
Domestic | 1,195 | 1,205 | (10 | ) | (0.8 | )% | |||||
Export | 4,529 | 4,483 | 46 | 1.0 | % | ||||||
Cargo and Other | 267 | 327 | (60 | ) | (18.3 | )% | |||||
Total International Package | 5,991 | 6,015 | (24 | ) | (0.4 | )% | |||||
Supply Chain & Freight: | |||||||||||
Forwarding and Logistics | 3,245 | 2,649 | 596 | 22.5 | % | ||||||
Freight | 1,349 | 1,462 | (113 | ) | (7.7 | )% | |||||
Other | 363 | 324 | 39 | 12.0 | % | ||||||
Total Supply Chain & Freight | 4,957 | 4,435 | 522 | 11.8 | % | ||||||
Consolidated | $ | 29,047 | $ | 28,072 | $ | 975 | 3.5 | % | |||
Consolidated volume (in millions) | 2,273 | 2,202 | 71 | 3.2 | % | ||||||
Operating weekdays | 128 | 127 | 1 | 0.8 | % | ||||||
Average Daily Package Volume (in thousands): | |||||||||||
U.S. Domestic Package: | |||||||||||
Next Day Air | 1,289 | 1,235 | 54 | 4.4 | % | ||||||
Deferred | 1,163 | 1,175 | (12 | ) | (1.0 | )% | |||||
Ground | 12,606 | 12,255 | 351 | 2.9 | % | ||||||
Total U.S. Domestic Package | 15,058 | 14,665 | 393 | 2.7 | % | ||||||
International Package: | |||||||||||
Domestic | 1,558 | 1,553 | 5 | 0.3 | % | ||||||
Export | 1,145 | 1,120 | 25 | 2.2 | % | ||||||
Total International Package | 2,703 | 2,673 | 30 | 1.1 | % | ||||||
Consolidated | 17,761 | 17,338 | 423 | 2.4 | % | ||||||
Average Revenue Per Piece: | |||||||||||
U.S. Domestic Package: | |||||||||||
Next Day Air | $ | 19.47 | $ | 20.07 | $ | (0.60 | ) | (3.0 | )% | ||
Deferred | 12.19 | 11.89 | 0.30 | 2.5 | % | ||||||
Ground | 8.10 | 8.16 | (0.06 | ) | (0.7 | )% | |||||
Total U.S. Domestic Package | 9.39 | 9.46 | (0.07 | ) | (0.7 | )% | |||||
International Package: | |||||||||||
Domestic | 5.99 | 6.11 | (0.12 | ) | (2.0 | )% | |||||
Export | 30.90 | 31.52 | (0.62 | ) | (2.0 | )% | |||||
Total International Package | 16.54 | 16.76 | (0.22 | ) | (1.3 | )% | |||||
Consolidated | $ | 10.48 | $ | 10.59 | $ | (0.11 | ) | (1.0 | )% |
2016 Revenue Per Piece Adjusted to Reflect 2015 Currency Exchange Rates | |||||||||||||||||
Six Months Ended | |||||||||||||||||
June 30 | Adjusted | ||||||||||||||||
2016 | 2015 | % Change | Currency | 2016* | % Change | ||||||||||||
Average Revenue Per Piece: | |||||||||||||||||
International Package: | |||||||||||||||||
Domestic | $ | 5.99 | $ | 6.11 | (2.0 | )% | $ | 0.23 | $ | 6.22 | 1.8 | % | |||||
Export | 30.90 | 31.52 | (2.0 | )% | 0.23 | $ | 31.13 | (1.2 | )% | ||||||||
Total International Package | $ | 16.54 | $ | 16.76 | (1.3 | )% | $ | 0.23 | $ | 16.77 | 0.1 | % | |||||
Consolidated | $ | 10.48 | $ | 10.59 | (1.0 | )% | $ | 0.03 | $ | 10.51 | (0.8 | )% | |||||
* Adjusted amounts reflect impacts for currency exchange rate differences | |||||||||||||||||
2016 Revenue Adjusted to Reflect 2015 Currency Exchange Rates | |||||||||||||||||
Six Months Ended | |||||||||||||||||
June 30 | Adjusted | ||||||||||||||||
2016 | 2015 | % Change | Currency | 2016* | % Change | ||||||||||||
Revenue (in millions): | |||||||||||||||||
U.S. Domestic Package | $ | 18,099 | $ | 17,622 | 2.7 | % | — | $ | 18,099 | 2.7 | % | ||||||
International Package | 5,991 | 6,015 | (0.4 | )% | 74 | $ | 6,065 | 0.8 | % | ||||||||
Supply Chain & Freight | 4,957 | 4,435 | 11.8 | % | 32 | 4,989 | 12.5 | % | |||||||||
Total revenue | $ | 29,047 | $ | 28,072 | 3.5 | % | $ | 106 | $ | 29,153 | 3.9 | % | |||||
* Adjusted amounts reflect impacts for currency exchange rate differences |
Preliminary | ||||
Year-to-Date | ||||
(amounts in millions) | June 30 | |||
Net cash from operations | $ | 4,693 | ||
Capital expenditures | (963 | ) | ||
Proceeds from disposals of PP&E | 11 | |||
Net change in finance receivables | (13 | ) | ||
Other investing activities | (35 | ) | ||
Free cash flow | $ | 3,693 | ||
Amounts are subject to reclassification. |
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