ATLANTA, GA: October 27, 2016. UPS has reported a year-on-year rise of 4.5 percent in net profit to US$3.67 billion for the first nine months of 2016. Revenue rose 3.9 percent to US$43.97 billion in the same period.
For the third quarter ending September 30, the company saw net profit rise to US$1.27 billion compared to the same period last year on a 4.9 percent increase in revenue to US$14.9 billion.
UPS said its international operating profit jumped 14 percent to US$576 million, a record for any third quarter in its 109-year history.
Revenue was US$3.0 billion, up 2.2 percent compared to the third quarter last year. Daily export volume increased 7.1 percent on double-digit gains out of Asia and high-single digit cross-border shipments within Europe, said the company.
"Through the third quarter we are performing according to our expectations, and we've taken the necessary steps to ensure we capitalize on record volume levels during peak season," noted Richard Peretz, UPS chief financial officer.
For the first nine months of 2016, UPS generated US$5.4 billion in cash from operations, which included a planned discretionary pension contribution of US$1.2 billion in the third quarter. Free cash flow was $3.6 billion after making capital expenditures of $1.8 billion.
In a related capex move, the company has ordered 14 B747-8s from Boeing for delivery between 2017 and 2020 in anticipation of increased demand on its high-volume trade lanes. The value of the contract, which includes options for 14 more aircraft, was not disclosed.
"UPS is making several strategic capital investments for increased global operating capacity," said David Abney, UPS chairman and CEO. "These investments will help enable customers to expand their presence in new and existing markets while fueling our profitable growth and attainment of UPS's long term business objectives."