UPS remains confident with its logistics strategy

UPS told investors last week that it would continue to invest in new technology and expanded facilities

By ·

Investment analysts greeted the news when UPS announced objectives for growing its revenue and profit over the next 3-to-5 years.

Jason Seidl, director of Equity Research – Rail, Trucking Air Freight & Logistics at Dahlman Rose & Co., noted that the company’s supply chain and freight business segment posted another strong quarter.

“Revenue increased 7 pecent to $2.32 billion, which was largely in line with our estimate,” he said.  “Operating profits climbed 41 percent on the 7 percent revenue growth, driven primarily by improvements in the Forwarding business unit, as a result of favorable rates and revenue management.”

UPS told investors last week that it would continue to invest in new technology and expanded facilities.

Diluted earnings per share are expected to grow 10 to 15 percent from 2011 to 2016, the company’s top executives told analysts and investors late last week.

Addressing analysts during the course of the Investor Conference, senior executives outlined expectations for performance of the U.S. Domestic, International and the Supply Chain segments. Additionally, the company announced major expansion plans for its European air hub in Cologne, Germany, increasing capacity by 65 percent.

“Our long-term outlook remains positive despite recent economic uncertainty,” said UPS Chairman and CEO Scott Davis. “UPS is well positioned to capture the opportunities presented by the mega trends shaping our industry.”

The Investor Conference, built around the theme “Stronger Than Ever…Positioned for Growth,” was held in Louisville in order to display the results of a multi-year, multi-billion-dollar investment program. Over the past six years, UPS has:

• Completed a $1 billion expansion of its high-tech UPS Worldport air hub.?
• Opened a new air freight hub and a Global Operations Center for the UPS Airlines. ?
• Began operations in a new Centennial ground hub.?
• Doubled the size of its supply chain and logistics campus.?
• Assembled the “youngest” fleet of aircraft in the cargo industry.
UPS Chief Financial Officer Kurt Kuehn summed up the conference by maintaining that UPS business model is “unique,” with a long-term sustainability plan in place.

“Our ever-expanding capabilities create a moat that separates us from our competitors and that will deliver superior returns to shareowners for years to come,” he said.


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

Global Logistics · Global Trade · Trade · All Topics
Latest Whitepaper
Unlock the Value of Your Supply Chain Through Embedded Analytics
Learn how embedded analytics can provide deeper supply chain intelligence and help you extract maximum value from data for your supply chain operations
Download Today!
From the May 2017 Issue
Everyone is talking about terms like digitization, Industry 4.0 and digital supply chain management, but what sort of technologies fall under these broad terms, and how will they change the management capabilities at our disposal? To find out, we talked to some noted supply chain analysts, consultants and technology executives and gathered six digital trends to watch.
Transportation Trends and Best Practices: The Battle for the Last Mile
2017 Technology Roundtable: Are we closer to “Intelligent” Logistics?
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Going Beyond Rate Negotiations for Logistics Cost Savings
The pressure to reduce cost is a fundamental part of every organization today leaving many supply chain professionals constantly renegotiating rates. This webcast examines four areas that may hold untapped savings potentials and even help organizations negotiate better rates.
Register Today!
EDITORS' PICKS
The Evolution of the Digital Supply Chain
Everyone is talking about terms like digitization, Industry 4.0 and digital supply chain management,...
2017 Salary Survey: Fresh Voices Express Optimism
Our “33rd Annual Salary Survey” reflects more diversity entering the logistics management...

LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...
ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...