FedEx Corp. on Thursday reported a higher-than-expected third-quarter net profit, but gave a low outlook for the current quarter citing soaring fuel prices and slowing U.S. economic growth, sending the package delivery company's shares down more than 2 percent."Our fourth-quarter earnings outlook has been impacted by higher-than-anticipated fuel prices and a weak U.S. economy," Chief Financial Officer Alan Graf said in a statement. "Looking ahead to our fiscal 2009, we are expecting a continuation of fourth-quarter trends, which would result in limited earnings growth next year.
"We are scrutinizing all expenses and investments to realign them with the current environment," he added.
Al Meyers, portfolio manager for the AHA Diversified Equity Fund, said the results showed "the downward economic spiral continues."
"The question is whether in three months time whether we'll see any improvement," he said.
The Memphis-based company reported net income for its quarter ending February 29, of $393 million, or $1.26 a share, down almost 7 percent from $420 million, or $1.35, a share a year earlier.
Wall Street analysts had on average expected earnings per share for the quarter of $1.23, according to Reuters Estimates.
In a conference call with analysts, high oil prices were mentioned repeatedly as weighing on the company's business.
Chief Executive Fred Smith said he saw "little justification" for current price levels and said the high costs had led to some customers shifting "to lower-cost services." Complete Story...
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