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UPS earnings rise on higher volumes

United Parcel Service Inc., the world's biggest package carrier, on Thursday reported a rise in quarterly earnings, excluding one-time items, on strong domestic and international volume increases.
/ Source: Reuters

United Parcel Service Inc., the world's biggest package carrier, on Thursday reported a rise in quarterly earnings, excluding one-time items, on strong domestic and international volume increases.

The Atlanta transport giant said fourth-quarter profit was $799 million, or 70 cents a share, excluding tax gains. Before extraordinary items, UPS earned $670 million, or 59 cents a share, in late 2002, when the company's mainstay U.S. parcel-transport business was stung by worries among shippers of a strike against the company.

Analysts expected UPS to earn 69 cents a share in the quarter ended Dec. 31, according to the Reuters Research unit of Reuters Group Plc. Share estimates among 17 analysts ranged from 65 cents to 71 cents. In October, UPS said it expected quarterly share profit between 65 cents and 70 cents

Quarterly net income totaled $856 million, or 75 cents a share, including tax-related gains. A year earlier, when the company had a $1.02 billion tax settlement, net income was $1.5 billion, or $1.32 a share.

"We had some benefits from the dollar," said UPS Vice President Teresa Finley in an interview. "But we had margin gains and good volume increases."

Revenue during the last three months of last year rose 8.2 percent to $8.93 billion, up from $8.25 billion in late 2002, according to a news release.

UPS, whose chocolate-brown trucks and planes carry more than 13.6 million items each day, said volumes had risen sharply in the quarter, helped by strong online shopping in the Christmas season.

Scott Davis, chief financial officer, said UPS expected volumes to rise about 4 percent in 2004 above the 3.44 billion delivered last year.

He also said UPS sees first-quarter profit between 58 cents and 62 cents a share, up from an adjusted 52 cents in early 2003. He also said UPS was reaffirming its targeted earnings growth of 12 percent to 18 percent for full year 2004.