FedEx beats profit forecasts, raises 12-month outlook

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FedEx beats profit forecasts, raises 12-month outlook
FILE- In this April 10, 2017, file photo, a FedEx envelope is placed into a dropbox in North Andover, Mass. FedEx Corp. reports earnings Tuesday, March 20, 2018. (AP Photo/Elise Amendola, File)

MEMPHIS, Tenn. (AP) — Tax reduction, higher rates and strength in its ground-shipping business helped boost FedEx’s profit during a stellar holiday gift-shipping season.

The delivery company is also raising its forecast for earnings in the fiscal year that ends in May.

FedEx Corp. said Tuesday that it earned .07 billion in the December-through-February quarter, up from million a year earlier.

Adjusted to eliminate one-time benefits, the company’s earnings of .72 handily beat the forecast of .08 per share from 11 analysts surveyed by Zacks Investment Research.

The tax-cut bill passed in December was a major boost for the Memphis, Tennessee-based company. FedEx reaped .5 billion in tax benefits, the biggest piece being a .15 billion gain because of lower deferred tax liability.

Revenue rose to .53 billion, beating an average forecast of .18 from the analysts surveyed by Zacks.

FedEx raised its forecast of full-year earnings to between and .40 per share excluding items related to tax benefits, pensions, and the cost of integrating Dutch delivery company TNT Express, which FedEx bought in 2016. That’s up from a previous forecast of a range between .70 to .30 a share.

Before the results, FedEx shares closed up .38 at .99. In about an hour of after-session trading they slipped to .99. At market closing, the shares had gained 31 percent in the last 12 months.

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Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on FDX at https://www.zacks.com/ap/FDX