UPS Earnings Surge, Led by Growth in International Segment

By Angela Chen 

United Parcel Service Inc. on Tuesday reported earnings that came in better than expected as all three of its main segments saw improved operating profit despite falling revenue.

"The strong momentum in our international segment is expected to continue and gives us confidence in achieving the upper end of our guidance range," Chief Executive David Abney said. The company affirmed its full-year guidance.

For the June quarter, UPS posted earnings of $1.23 billion, or $1.35 a share, up from $454 million, or 49 cents a share a year earlier.

Revenue fell to $14.1 billion from $14.27 billion, partly because of foreign-exchange rates.

Analysts had expected earnings of $1.26 a share on revenue of $14.51 billion, according to Thomson Reuters.

Total company shipments increased 2.1% to 1.1 billion packages.

In the domestic segment, revenue grew 1.6% to $8.81 billion. Operating profit grew 3%.

Sales in the international segment fell 6.4% to $3.05 billion. Operating profit increased 17% because of network improvements, volume growth and pricing initiatives. The strong dollar also drove U.S. imports higher.

In the supply and freight segments, revenue fell 4.5% to $2.24 billion. Operating profit improved 18%, driven by gains in its forwarding segment.

Shares, down about 14% this year through Monday's close, rose 2.4% to $97.39 in premarket trading.

Write to Angela Chen at [e-mail]

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