UPS blames winter weather for drop in 1Q profit
By DAVID KOENIG | AP Airlines Writer April 24, 2014 8:06AM
First-quarter revenue at UPS slumped 12 percent as winter storms increased costs for the shipping giant and cut into its revenue. | AP file photo
DALLAS — First-quarter revenue at UPS slumped 12 percent as winter storms increased costs for the shipping giant and cut into its revenue.
The Atlanta company said Thursday that the rough start to the year means that full-year earnings will come in at the low end of its earlier forecasts.
UPS Inc. reported net income of $911 million, or 98 cents per share, well short of the $1.08 that Wall Street was expecting and less than the $1.04 billion, or $1.08 per share, it earned a year earlier.
UPS said winter storms reduced operating profit by $200 million as costs rose.
Revenue increased by 2.6 percent to $13.78 billion, but that was still shy of the $13.91 billion that analysts had forecast, according to a FactSet survey.
Average daily shipments in the U.S. rose 4.2 percent, but at the same time, revenue per package fell at home and abroad as customers shifted toward lower-priced services.
UPS said that full-year earnings would be at the low end of its earlier forecast of between $5.05 and $5.30 per share. Analysts expect $5.18 per share.
Shares of UPS Inc. fell $1.31 to $97.93 before the opening bell Thursday. They are down 6 percent so far in 2014.