|
 The news came as UPS reported a 3.7 percent increase in third-quarter profit on a modest rise in sales.
While it said its earnings projection for the year will be in line with previous projections, the company said it expects slowing retail sales will restrain U.S. domestic volume growth.
Chief Financial Officer Scott Davis said retail sales growth is "a wild card" heading into the holiday season, which is typically UPS' busiest shipping period of the year. International growth is expected to remain strong and help offset weaker U.S. conditions, executives said.
Analysts were mostly positive, as the latest quarter's results, when one-time items are excluded, beat Wall Street expectations. Company shares rose 55 cents to close at $75.64 Tuesday.
"We think UPS is operating well in a tough environment, is well diversified geographically, and gaining traction in its freight business," Standard & Poor's analyst Jim Corridore said in a research note.
UPS, also known as United Parcel Service Inc., earned $1.08 billion, or $1.02 a share, for the three months ended Sept. 30, up from $1.04 billion, or 96 cents a share, for the same period a year earlier.
Excluding a one-time charge related to the restructuring and disposal of certain operations in France within its supply chain and freight segment, UPS said it earned $1.11 billion, or $1.05 a share, in the third quarter.
Analysts surveyed by Thomson Financial were expecting earnings of $1.02 a share. The estimates typically exclude one-time items.
Revenue in the quarter rose 4.7 percent to $12.21 billion, from $11.66 billion recorded in the same period a year ago.
For the first nine months of the year, UPS said it earned $3.02 billion, or $2.84 a share, down from $3.07 billion, or $2.82 a share, a year earlier. Nine-month revenue rose 4 percent to $36.30 billion from $34.92 billion a year earlier.
[to top of second column]
 |
 For the full year, it expects adjusted diluted earnings per share to be $4.13 to $4.19, within the range it provided at the beginning of 2007.
Earlier this month, UPS said that Chief Executive Mike Eskew will retire at the end of the year after six years at the helm and more than three decades with the company.
Davis will replace Eskew. The move was not much of a surprise, although Eskew, 58, had not said previously when he would step down.
Eskew said Tuesday he was pleased with the third-quarter's results and is confident in the company's future.
"Clearly, we're headed in the right direction," Eskew said.
He noted that UPS reached a tentative agreement on a new contract with the Teamsters union on Sept. 30.
The five-year pact will raise wages annually and increase funds that provide pension, health and welfare benefits to the covered employees.
The agreement allows UPS to withdraw from the Central States Pension Fund, with the company making a $6.1 billion pretax payment to Central States. Davis said Tuesday that UPS will borrow money to make the payment. UPS has said it will move employees into a single employer pension fund jointly administered by UPS management and the Teamsters.
Approval of the contract is now up to union members. The Teamsters represent 238,000 of UPS' 427,700 employees. Those represented include all hourly full-time drivers and part-time sorters.
___
On the Net:
UPS Inc.: http://www.ups.com/
[Associated Press; by Harry R.
Weber]
Copyright 2007 The Associated Press. All rights reserved. This
material may not be published, broadcast, rewritten or
redistributed.
 |
