UPS slashes forecast for earnings
New York, July 30, 2014
United Parcel Service (UPS), the world's biggest courier company, slashed its earnings forecast for the year as it spends to boost capacity ahead of the holiday shopping season.
The company also reported a bigger-than-expected decline in second-quarter profit, reported the Gulf Daily News, our sister publication.
UPS faced criticism last Christmas when a surge in online shopping caught the company off guard, leading to huge delays that frustrated customers.
The company said yesterday it would invest $175 million to beef up its capacity and technology to ensure timely deliveries during the peak shopping season beginning around Thanksgiving.
"... We are making investments in new capabilities and network capacity to ensure we meet customer expectations," chief financial officer Kurt Kuehn said.
The Atlanta-based company said it expects full-year adjusted earnings of $4.90-$5 per share.
The company said in April it expected earnings to come in at the lower end of its previous forecast of $5.05-$5.30 per share.
UPS's net income fell to $454m, or 49 cents per share in the second quarter ended June 30, from $1.07 billion, or $1.13 per share, a year earlier.
Net income included a charge of $665m for post-retirement liabilities for some union employees. Excluding the charge, the company earned $1.21 per share, falling short of the average analyst estimate $1.25 per share. – TradeArabia News Service