Atlanta-based United Parcel Service (UPS) announced that first-quarter 2018 earnings per share (EPS) rose 17% to US$1.55 and net income increased 15% to $1.345 billion, led by double-digit operating profit growth in both international and supply chain and freight segments.
“Top-line growth in our business was strong across all business segments, reflecting the power of UPS’s global solutions and continued favorable economic conditions,” said chairman and CEO David Abney. “When combined with our transformation initiatives, these favorable trends position UPS for strong returns going forward.”
From January to March this year, total revenue increased 10% to $17.113 billion on strong demand for UPS solutions.
For the international segment, revenue and operating profit both climbed 15%, said UPS in a statement.
“The execution of our diversified global strategies and our investments produced double-digit growth in revenue and profit,” said Abney. “Each of our International regions is contributing to our financial gains, and we expect this strong momentum to continue.”
International revenue increased 15% to $3.533 billion in 1Q 2018 despite two fewer operating days in many countries, while operating profit reached $594 million in the same period from $518 million in the first quarter of 2017, up 15% on higher export shipments and expanded product yields.
Export, domestic, and cargo product groups all achieved double-digit revenue growth, and export shipments per day grew an average 12% as premium products continue to outpace non-premium.
Export volume growth in Europe and the U.S. continued to be strong for the quarter.
Meanwhile the supply chain and freight segment produced another quarter of strong financial results. “Revenue and operating profit grew by double digits due to successful revenue-quality initiatives, opportunistic growth strategies and structural cost reductions,” said the logistics leader.
The segment’s revenue increased to $3.353 billion, up 16% over 1Q 2017. Operating profit was $170 million, up 14% from the same quarter in 2017. The business units focused on high quality, middle-market customers.
The forwarding business led all units with 27% revenue growth, as revenue management initiatives and stable market conditions drove top-line gains.
UPS freight revenue increased 9.9% on solid LTL (less-than-truckload) pricing and tonnage growth.
“Our focused business strategies are producing strong results in both the international and supply chain segments,” said Richard Peretz, UPS’s chief financial officer. “The benefits from our investments, new multi-year transformation efficiencies and stronger pricing position us well for shareowner value creation.”
Reaffirming its full-year 2018 guidance, UPS said it expects 2018 adjusted diluted EPS to be in a range of $7.03 to $7.37.
