FedEx Q4 net income up 33%

• Q4 revenue up 13% to $6.63 billion (Q4 2010: $5.88bn)

• Q4 operating income up 4% to $429 million (Q4 2010: $413m)

• FedEx International Priority (IP) average daily package volume increased 6%, led by exports from Asia. IP revenue per package grew 8% due to higher fuel surcharges, the favourable impact of exchange rates, improved weight per package and yield management actions.

• Whilst US domestic average daily package volume dropped slightly, revenue per package grew by 10% due to higher fuel surcharges, yield management actions and increased weight per package.

• Operating income improvements were driven by strong yield growth, particularly in US domestic package services, and by volume growth in IP package and freight services.

• Results were negatively impacted by increased retirement plan expenses and the reinstatement of certain compensation programs.

FedEx Ground

• Q4 revenue up 15% to $2.26 billion (Q4 2010: $1.96bn)

• Q4 operating income up 31% to $417 million (Q4 2010: $319m)

• FedEx Ground average daily package volume grew 6% in the fourth quarter driven by increases in the business-to-business market and the FedEx Home Delivery service. Revenue per package increased 7% primarily due to yield management actions and higher fuel surcharges.

• FedEx SmartPost average daily volume increased by 24% due to growth in e-commerce and gains in market share. FedEx SmartPost revenue per package increased by 8%, primarily due to growth in higher-yielding services and increased fuel surcharges.

FedEx Freight

• Q4 revenue was up 6% to $1.31 billion (Q4 2010: $1.23bn)

• Q4 operating income of $42 million, compared with an operating loss of $36 million in Q4 2010

• LTL yield increased by 13% primarily due to yield management actions and higher LTL fuel surcharges. LTL average daily shipments decreased by 8% as a result of the yield management actions.

• The segment returned to profitability in the quarter due primarily to the higher LTL yield. Last year’s results included an $18 million impairment charge related to the goodwill associated with the acquisition of Watkins Motor Lines.