Package delivery company FedEx Corp. said Tuesday it expects its fiscal first-quarter results will exceed expectations, but it affirmed its fiscal 2009 outlook and cut its capital spending plan.
Investors sent shares up $4.55, or 5.4%, to $89.30 during aftermarket electronic trading, after closing at $84.75.
The company now expects net income for the quarter ended Aug. 31 will total $1.23, ahead of previous guidance of 80 cents to $1 per share.
Analysts polled by Thomson Reuters, on average, expect a profit of 95 cents per share.
The increase is due to lower-than-expected fuel costs late in the quarter as well as "stringent" cost-cutting, the company said.
However, FedEx (FDX, Fortune 500) did not raise fiscal 2009 guidance and instead affirmed its outlook of $4.75 to $5.25 per share, while analysts expect earnings of $4.98 per share.
Weaker macroeconomic conditions offset better-than-expected first-quarter results, the Memphis, Tenn.-based company said.
"While sustained declines in fuel prices could improve our full-year outlook, the slowing economic growth trends in the United States pay day advance instant payday loan. are now extending to other areas of the global economy," said Alan B. Graf Jr., executive vice president and chief financial officer, in a statement. "As a result, we have reduced our planned capital investments by $400 million, to $2.6 billion for fiscal 2009."
Oil prices closed below $104 a barrel Tuesday for the first time since early April, and prices are now down about 30% since peaking at $147.27 a barrel in July.
FedEx will also shift its meeting with investors and lenders from Oct. 2, to April 1-2, 2009, in China, where it will unveil its Asia-Pacific hub.
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