UPS Falls Short in Q2, Trims 2012 Outlook

by Christopher Freeburn | July 24, 2012 11:53 am

UPS Falls Short in Q2, Trims 2012 Outlook

United Parcel Service (NYSE:UPS[1]) said on Tuesday that its second-quarter earnings[2] increased to $1.12 billion, up from $1.092 billion during the same time last year.

Revenue for the logistics and shipping company increased to $13.35 billion, up from $13.19 billion in 2011. That disappointed Wall Street, which had been looking for $13.7 billion, Reuters noted.

Adjusted EPS for the second quarter was $1.15, up 7.5% from $1.07 last year, but falling short of analysts who had predicted $1.17.

Investors were unhappy with the results, sending UPS shares down more than 5% in Tuesday morning trading.

UPS also cut is outlook for 2012, saying it now expects earnings per share of between $4.50 and $4.70. That is down from an earlier forecast of between $4.75 and $5.00 a share.

Company officials attributed the diminished outlook to rising concerns over a weakening U.S. economy, the ongoing European economic crisis, and slowing exports from Asia.

UPS’s European presence is increasing due to its acquisition of the Netherlands-based TNT Express.

Analysts cited by Reuters attributed the missed quarterly forecasts and lowered outlook to reduced international freight shipping.

Last month, shipping rival FedEx (NYSE:FDX[3]) posted lower earnings for its fiscal fourth quarter that still beat Wall Street forecasts, but lowered its outlook for the current fiscal year[4] due to the worsening global slowdown.

Endnotes:
  1. UPS: http://studio-5.financialcontent.com/investplace/quote?Symbol=UPS
  2. that its second-quarter earnings: http://www.reuters.com/article/2012/07/24/us-ups-results-idUSBRE86N0Q520120724
  3. FDX: http://studio-5.financialcontent.com/investplace/quote?Symbol=FDX
  4. but lowered its outlook for the current fiscal year: http://investorplace.com/2012/06/fedex-profit-drops-beats-forecasts/

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