OREANDA-NEWS. FedEx Corp. today reported earnings of USD 2.14 per diluted share for the second quarter ended November 30, up 36% from last year's USD 1.57 per share.

"FedEx posted strong results and a higher operating margin in the second quarter, with continued growth in volumes and base yields in each of our transportation segments," said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer.  "We are in the final stages of this year's peak shipping season, and I'd like to thank the more than 300,000 dedicated team members around the world for once again delivering outstanding service to our customers during the holidays."

FedEx Corp. reported the following consolidated results for the second quarter:
• Revenue of USD 11.9 billion, up 5% from USD 11.4 billion the previous year
• Operating income of USD 1.01 billion, up 22% from USD 827 million last year
• Operating margin of 8.5%, up from 7.3% a year ago
• Net income of USD 616 million, up 23% from last year's USD 500 million

The company reaffirms its fiscal 2015 earnings forecast of USD 8.50 to USD 9.00 per diluted share.  The outlook assumes continued moderate economic growth and a modest net benefit from fuel.  The capital spending forecast for fiscal 2015 remains USD 4.2 billion.

For the second quarter, the FedEx Express segment reported:
• Revenue of USD 7.02 billion, up 3% from last year's USD 6.84 billion
• Operating income of USD 484 million, up 36% from USD 357 million a year ago
• Operating margin of 6.9%, up from 5.2% the previous year

FedEx International Economy(r) volume grew 5%, while FedEx International Priority(r) volume increased 1%.  International export revenue per package was flat, as higher rates were offset by unfavorable currency exchange and lower fuel surcharges.

Operating results improved due primarily to U.S. domestic and international export package revenue growth, cost management related to profit improvement programs, lower pension expense and a slight net benefit from fuel.  These improvements were partially offset by the timing of higher aircraft maintenance expense.  The year over year increase in aircraft maintenance expense is expected to subside beginning in the fourth fiscal quarter.

For the second quarter, the FedEx Ground segment reported:
• Revenue of USD 3.06 billion, up 8% from last year's USD 2.85 billion
• Operating income of USD 465 million, up 6% from USD 439 million a year ago
• Operating margin of 15.2%, down from 15.4% the previous year

FedEx Ground average daily volume grew 5% in the second quarter, driven by growth in both business-to-business and FedEx Home Delivery services.  Revenue per package increased 3% due to rate increases and higher residential surcharges.  FedEx SmartPost average daily volume decreased 4% due to the reduction in volume of a major customer.  FedEx SmartPost revenue per package increased 7% due to rate increases and improved customer mix, partially offset by higher postage rates.

For the second quarter, the FedEx Freight segment reported:
• Revenue of USD 1.59 billion, up 11% from last year's USD 1.43 billion
• Operating income of USD 112 million, up 35% from USD 83 million a year ago
• Operating margin of 7.1%, up from 5.8% the previous year

Less-than-truckload (LTL) average daily shipments increased 8%, including a 10% increase in demand for Priority service.  LTL revenue per shipment grew 3% due to higher weight per shipment, higher rates and increased fuel surcharges.