Dear readers! We present to your attention the third issue of the LOGISTICS journal for 2025. Our editorial staff, like all our colleagues, is preparing for the TransRussia 2025 exhibition, the largest event in the industry. In this issue, we have prepared an interview with Natalia Lomunova, Director of TransRussia, with whom we are talking about a flexible approach, new participants and digital services. We continue the series of articles from P.V.
Dear readers! We present to your attention the first issue of the LOGISTICS journal in 2025. First of all, we would like to draw readers' attention to our new partner R1 Development, a development company that creates a new generation environment and specializes in the construction of industrial, logistics, commercial and residential real estate. One of the projects of R1 Development is the Druzhba industrial park network.
Dear readers! We present to your attention the final issue of the LOGISTICS journal in 2024. We have tried to make it rich and interesting. Today, many Russian companies operate under strict sanctions restrictions, which force them to reorient logistics flows. One of the possible solutions to this problem may be the Russia – Mongolia – China economic corridor. Details can be found in the article by Alexandra Kazunina.
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
ATLANTA, Oct. 27, 2015 – UPS (NYSE:UPS) today announced third quarter 2015 diluted earnings per share of $1.39, a 5.3% increase over the same period last year. International operating profits were up more than 10% to $507 million, driving company-wide results higher.
Currency exchange rates and lower fuel surcharges reduced total revenue slightly to $14.2 billion. On a currency-neutral basis revenue grew 1.8%. Revenue management initiatives across the business resulted in base rate improvements.
The company completed the acquisition of Coyote Logistics during the quarter. The addition of this asset-light, truckload brokerage firm provides expanded capabilities for UPS. Coyote is expected to create more than $100 million of synergies.
“Third quarter results reflect strong progress on our long-term initiatives despite uneven economic conditions,” said David Abney, UPS chief executive officer. “We remain committed to these strategies to support customers and improved shareowner value.”
Total company shipments increased 1.9% over the third quarter last year to 1.1 billion packages, led by U.S. air products and European transborder shipments.
Cash Flow
For the nine months ended Sept. 30, UPS generated $4.6 billion in free cash flow. The company paid dividends of $1.9 billion, an increase of 9.0% per share over the prior year. UPS also repurchased 20 million shares for approximately $2.0 billion.
U.S. Domestic Package
U.S. Domestic revenue of $8.9 billion was up 1.9% over the same quarter last year. Lower fuel surcharge rates dampened revenue growth and lowered revenue per package by about 250 basis points. Strong base rate improvements were also offset by changes in product and customer mix.
Daily shipments were up 0.6%, due primarily to faster growing premium air products. Deferred Air products jumped 13% and UPS Next Day Air was 4.0% higher as more ecommerce shippers chose to upgrade to air services. Ground products dropped slightly as slowing industrial production contributed to the first year-over-year decrease in business-to-business (B2B) shipments this year. Meanwhile, the pace of growth for all business-to-consumer (B2C) products increased this quarter.
Operating profit declined 1.6% to $1.3 billion with an operating margin of 14.2%. The year-over-year change in fuel surcharge revenue fell faster than fuel related expense, creating a drag on operating results.
International Package
International operating profit increased 10% to $507 million. Operating margin expanded to 17.1%. Operating results continue to benefit from revenue quality enhancements, network improvements and Export volume growth.
Adjusting for the negative impact of currency, total International revenue increased 0.4%. In addition, lower fuel surcharge revenue resulted in an approximately 350 basis point reduction in package yield. Underlying base rates increased across all regions of the world.
Daily Export shipments were up 1.2% over the prior year. Growth in Europe transborder and U.S. inbound shipments outweighed a drop in Asia and U.S. exports.
Supply Chain & Freight
Supply Chain & Freight revenue increased slightly to $2.4 billion. Lower Forwarding revenue and a drop in less-than-truckload (LTL) tonnage was offset by the addition of revenue from Coyote Logistics. Despite approximately $20 million in Coyote transaction fees, total segment operating profit increased to $219 million. Operating margin expanded over the prior year period to 9.1%.
UPS closed on its Coyote Logistics acquisition midway through the quarter. In October, UPS’s Freight Brokerage team transitioned to Coyote’s world-class order management platform, further strengthening our product offering.
The Freight Forwarding business continues to benefit from revenue quality initiatives started earlier in the year. While tonnage and revenue were down, improvements to the network and pricing drove significant operating profit expansion.
The Distribution business continues to build out its infrastructure to serve the healthcare and aerospace industries. Revenue increased slightly as growth was dampened by the effects of currency translations.
UPS Freight revenue dropped 8.6% due to lower fuel surcharges and reduced LTL tonnage during the quarter. Changes in fuel surcharges contributed to about 600 basis point reduction in the revenue growth rate. Soft market demand combined with selective pricing initiatives also contributed to the decline.
Outlook
“We are generating positive momentum as a result of the strong execution of our business units,” said Richard Peretz, UPS chief financial officer. “This gives us confidence we will achieve the higher-end of our full-year earnings per share guidance.”
The company’s guidance for 2015 full-year diluted earnings per share is $5.05 to $5.30, an increase of 6% to 12% over adjusted 2014 results.
 |
 |
