FedEx’s Profit Increases 33%, Tops Forecasts

FedEx Corp. said Wednesday that its fiscal second-quarter profit jumped 33%, easily beating Wall Street’s predictions and its own. Its stock rose to a new 52-week high on the earnings report.

Although a strong economy helped, earnings rose largely because of a focus on operating costs and promotion of the shipping company’s more profitable services, market analysts said.

Profit rose to $471 million, or $1.53 a share, from $354 million, or $1.15, a year earlier. Revenue grew 10% to $8.09 billion.

Analysts polled by Thomson Financial expected profit of $1.40 a share and sales of $8.07 billion. The company had forecast profit of $1.30 to $1.45 a share.

FedEx shares rose $5.21, or 5.3%, to $103.70, marking a new 52-week closing high.

FedEx, based in Memphis, raised its third-quarter profit estimate to $1.15 to $1.30 a share. Analysts predict $1.23 a share.

Early in the quarter ended Nov. 30, business was slower than anticipated for FedEx Ground, the company’s primary trucking division. It picked up toward the end of the period, however, said Mike Glenn, FedEx vice president for market development.

“We’re growing faster than the market,” Glenn said.

FedEx raised rates in the quarter an average of 3.5% for its express service and 3.9% for FedEx Ground.