EXPRESS giant FedEx saw its fiscal year third-quarter revenues decline by 2 per year on year to US$21.7 billion, but operating income improved by 19 per cent on last year to $1.2 billion and net income was up 14 per cent to $879 million.
FedEx said the improved profit performance was a result of its DRIVE cost-cutting scheme that aims to reduce expenses by US$4 billion, reports London's Air Cargo News.
In the third quarter, its ground network achieved savings of $290 million, air costs were down $110 million and general/admin expenses reduced by $150 million.
The savings in the air network are down to a 'focus on structural transformations and reduction of flight hour costs' and optimizing its network in Europe.
The company has also parked aircraft to help reduce costs and in response to weaker demand levels.
Looking at third-quarter divisional performance, FedEx Express saw revenues decline 2 per cent to $10.1 billion but operating income was up 96 per cent to $233 million.
FedEx Express operating results improved due to lower structural costs resulting from DRIVE initiatives and the benefit from one additional operating day, partially offset by lower revenue.
FedEx Ground saw revenues improve by 1 per cent to $8.7 billion and operating profits improved by 12 per cent to $942 million.
FedEx Ground operating results increased due to lower structural costs resulting from DRIVE initiatives, higher base yield, and reduced self-insurance costs.
Cost per package was flat, as lower line-haul expense and improved dock productivity offset higher first- and last-mile costs.
Revenues at its Freight segment slipped by 26 per cent to $2.1 billion and operating profit was down 12 per cent to $340 million.
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FedEx said the improved profit performance was a result of its DRIVE cost-cutting scheme that aims to reduce expenses by US$4 billion, reports London's Air Cargo News.
In the third quarter, its ground network achieved savings of $290 million, air costs were down $110 million and general/admin expenses reduced by $150 million.
The savings in the air network are down to a 'focus on structural transformations and reduction of flight hour costs' and optimizing its network in Europe.
The company has also parked aircraft to help reduce costs and in response to weaker demand levels.
Looking at third-quarter divisional performance, FedEx Express saw revenues decline 2 per cent to $10.1 billion but operating income was up 96 per cent to $233 million.
FedEx Express operating results improved due to lower structural costs resulting from DRIVE initiatives and the benefit from one additional operating day, partially offset by lower revenue.
FedEx Ground saw revenues improve by 1 per cent to $8.7 billion and operating profits improved by 12 per cent to $942 million.
FedEx Ground operating results increased due to lower structural costs resulting from DRIVE initiatives, higher base yield, and reduced self-insurance costs.
Cost per package was flat, as lower line-haul expense and improved dock productivity offset higher first- and last-mile costs.
Revenues at its Freight segment slipped by 26 per cent to $2.1 billion and operating profit was down 12 per cent to $340 million.
SeaNews Turkey
