Execution, Strategies and Investments Drive Continued Gains and Uniquely Position UPS for Future Success
- 4Q19 Operating Profit Growth and Margin Expansion in All Segments
- 4Q19 Positive Operating Leverage Driven by Lower Unit Cost in the U.S.
- 4Q19 Diluted EPS of ($0.12); Adjusted* Diluted 4Q19 EPS Up 8.8% to $2.11
- 4Q19 U.S. Daily Volume Grew Nearly 9%; Next Day Air Volume Up Nearly 26%
- 2019 Cash from Operations of $8.6B; Adjusted Free Cash Flow Topped $4.1B
- Announces Full-Year 2020 Adjusted EPS Guidance Range of $7.76 to $8.06
- Speeding up time-in-transit and broadening weekend services in 2020 to capture profitable growth from Small- and Medium-sized Businesses (SMB)
UPS (NYSE:UPS) today announced fourth-quarter 2019 adjusted earnings per share of $2.11, an 8.8% increase over the same period last year. The company’s results highlight the strong volume growth in the U.S. Domestic segment and the impact of successful execution from all segments.
“Our network improvements from transformation enabled UPS to embrace a surge in demand for air products while at the same time generate productivity improvements and positive operating leverage,” said David Abney, UPS chairman and CEO. “Looking to 2020, we will continue to adapt to the changing environment, strengthen our network and create new solutions to support our strategic growth initiatives and help our customers grow and compete.”
In the fourth quarter of 2019, the company incurred a non-cash, after-tax mark-to-market (MTM) pension charge of $1.8 billion, an after-tax transformation charge of $39 million, and U.S. Domestic after-tax legal contingency and expense charges of $91 million, predominantly related to the New York cigarette case. The total impact to EPS was $2.23 per diluted share. MTM pension charges of $1.42 per diluted share were included in the company’s fourth-quarter GAAP results in the prior-year period.
4.º tri 2018
US$ 20.568 milhões
US$ 19.848 milhões
US$ 1,84 bilhão
US$ 453 milhões
US$ 1.690 milhões
Diluted Earnings/Loss Per Share
* “Adjusted” amounts presented in this release are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics, including a reconciliation to the most closely correlated GAAP measure.
For the total company in 4Q 2019:
- Average daily volume levels exceeded 26.6 million packages, an increase of 7.5%, driven by high demand for air services in the U.S.
- Consolidated revenue increased 3.6% to $20.6 billion, due to strong average daily volume growth during the peak holiday season.
- Operating profit grew 6.4%, and 13.7% on an adjusted basis, with margin improvement across all segments.
Segmento doméstico dos EUA
The U.S. Domestic segment benefited from several transformation initiatives, including increased automated capacity and new aircraft added to the global air fleet, which positioned UPS to handle volume growth in each month of the quarter. Total volume across all products grew nearly 9%. Growth was driven by the structural shift to faster delivery in retail and e-commerce, and from competitive wins. UPS experienced growth from a number of large and SMB customers, with the growth led by UPS’s largest customer, Amazon.
“We processed record volume during the quarter as customers took full advantage of the capabilities of our integrated network and broad portfolio of solutions,” said Abney. “Given the tremendous opportunities ahead, we have elected to implement SMB initiatives now to speed up our network and broaden our weekend operations, actions that will improve our competitiveness and generate growth.”
4.º tri 2018
US$ 12.575 milhões
US$ 1.207 mi
US$ 999 milhões
US$ 999 milhões
- Revenue grew $833 million, a more than 6.5% increase, with growth across all products.
- Operating profit increased 7.5%, up over 20% on an adjusted basis.
- Operating margin was 8%; adjusted operating margin expanded 110 basis points.
- Unit costs declined 2.1%; on an adjusted basis down 3.2%, contributing to the third consecutive quarter of positive operating leverage.
The International segment delivered higher profit and expanded operating margin, adapting well to the dynamic macro environment. Strong execution, cost management and a strategic focus on market and e-commerce opportunities enabled the solid performance for the quarter.
4.º tri 2018
US$ 3.829 milhões
US$ 809 mi
US$ 781 milhões
US$ 781 milhões
- Export volume was down slightly as gains on intra-Europe, intra-Asia and U.S. export trade lanes did not fully offset the declines into and out of the U.K. and on the Asia-U.S. lane.
- Operating profit increased more than 2%, and by 3.6% on an adjusted basis.
- Industry-leading operating margin remained strong at 21.2%; adjusted operating margin expanded 110 basis points.
Segmento de cadeia de suprimentos e frete
Supply Chain and Freight produced strong profit growth in the quarter. The segment also expanded operating margins driven by disciplined cost management actions and continued focus on growing its SMB customer base.
4.º tri 2018
US$ 3.444 milhões
US$ 262 mi
US$ 224 milhões
US$ 224 milhões
- Operating profit increased more than 16%, and by 17% on an adjusted basis.
- Logistics, Marken and UPS Freight delivered revenue growth.
- Logistics and Marken grew profits by double digits, which helped offset softer conditions in Forwarding and truckload brokerage.
- UPS Freight produced an increase in revenue per LTL (less-than-truckload) hundredweight of 2.5%, driven by its focus on SMBs.
Full-year 2019 Consolidated Results
- UPS’s transformation investments generated higher total revenue, operating profit growth and margin expansion in all segments.
- Full-year 2019 diluted EPS totaled $5.11; adjusted diluted EPS was $7.53, excluding the impacts of the MTM pension charge, transformation charges and legal contingencies.
- Total revenue increased to $74 billion, driven by strong volume growth in the U.S.
- Capital expenditures were $6.4 billion, and on an adjusted basis $6.5 billion, to support network enhancements.
- Annual adjusted free cash flow exceeded $4.1 billion.
- Dividends paid were $3.3 billion, a per-share increase of 5.5% over the prior year.
- The company repurchased more than 9 million shares for approximately $1 billion.
A empresa divulga um plano em base ajustada (não GAAP), pois não é possível prever ou fornecer uma conciliação que reflita o impacto de futuros ajustes de pensão a valor de mercado ou outros acontecimentos não previstos, os quais seriam incluídos em resultados relatados (GAAP) e poderiam ter um impacto importante.
“UPS managed through several challenges in 2019, including declines in industrial production,” said Brian Newman, UPS’s chief financial officer. “We were able to leverage the capital investments we have made to grow profits and expand margins, and we are fast-tracking our initiatives in 2020 to better position UPS to capitalize on structural changes in the market and growth opportunities.”
- Adjusted, diluted earnings per share are expected to be in a range of $7.76 to $8.06, which includes forecasted weakness on the industrial side of the U.S. and global economies as well as spending on SMB initiatives that will significantly increase UPS competitiveness and will be EPS accretive in 2021.
- The 2020 effective tax rate is expected to be between 22.5 and 23.5 percent.
- Capital expenditures are planned to be around $6.7 billion, primarily to support global facility and automation expansions.
- Cash from operations is expected to be around $10 billion and free cash flow is anticipated to be between $4.3 and $4.7 billion.
- Transformation charges are excluded from guidance.
Informações sobre a teleconferência
UPS CEO David Abney and CFO Brian Newman will discuss fourth-quarter results with investors and analysts during a conference call at 8:30 a.m. ET, 30 de janeiro de 2020. That call will be open to others through a live Webcast. To access the call, go to www.investors.ups.com and click on “Earnings Webcast.” Informações financeiras adicionais estão incluídas nas tabelas financeiras detalhadas que estão sendo publicadas em www.investors.ups.com em “Financials” e nos documentos apresentados à SEC como um anexo ao nosso Relatório Atual no Formulário 8-K.
Sobre a UPS
A UPS (NYSE: UPS) é líder mundial em logística, oferecendo uma ampla gama de soluções que abrangem transporte de pacotes e frete, facilitação de comércio internacional e implementação de tecnologia avançada para gerenciar o mundo dos negócios de modo mais eficiente. Com sede em Atlanta, a UPS atende mais de 220 países e territórios em todo o mundo. A UPS foi premiada pela revista Newsweek como a empresa com o Melhor Serviço de Atendimento ao Cliente dos EUA na categoria Serviços de Remessa e Entrega, foi eleita a Marca Mais Valiosa em Transporte pela Forbes e ficou entre as primeiras posições na lista JUST 100 de responsabilidade social, no Índice Mundial de Sustentabilidade da Dow Jones e no Quociente de Reputação da Pesquisa Harris, entre outras classificações e prêmios de prestígio. A empresa pode ser encontrada na web em ups.com ou pressroom.ups.com, e seu blog corporativo pode ser encontrado em ups.com/longitudes. A eNewsletter de sustentabilidade da empresa, UPS Horizons, pode ser encontrada em ups.com/sustainabilitynewsletter. Para receber notícias diretamente da UPS, siga @UPS_News no Twitter. Para enviar com a UPS, visite ups.com/ship.
Except for historical information contained herein, the statements made in this release constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements, including statements regarding the intent, belief or current expectations of UPS and its management regarding the company's strategic direction, prospects and future results, involve certain risks and uncertainties.
Certain factors may cause actual results to differ materially from those contemplated by the forward-looking statements, including changes in economic and other conditions in the markets in which we operate, governmental regulations (including tax laws and regulations), our competitive environment, the facts or assumptions underlying our health and pension benefit funding obligations, the results of negotiation and ratification of labor contracts, the impact of any strikes, work stoppages or slowdowns, changes in aviation and motor fuel prices, cyclical and seasonal fluctuations in our operating results, and other risks discussed in the company's Form 10-K and other filings with the Securities and Exchange Commission, which discussions are incorporated herein by reference.
Conciliação de medidas financeiras GAAP e não GAAP
We supplement the reporting of our financial information determined under generally accepted accounting principles ("GAAP") with certain non-GAAP financial measures, including, as applicable, "as adjusted" operating profit, operating margin, other income (expense), income (loss) before income taxes, income tax expense, net income and earnings per share. Além disso, divulgamos periodicamente o fluxo de caixa livre, o fluxo de caixa livre excluindo contribuições previdenciárias discricionárias e despesas de capital que abrangem a amortização do valor presente de obrigações de arrendamento mercantil. As medidas equivalentes determinadas de acordo com as normas GAAP também são chamadas de “declaradas” ou “não ajustadas”.
We consider quantitative and qualitative factors in assessing whether to adjust for the impact of items that may be significant or that could affect an understanding of our ongoing financial and business performance or trends. Examples of items for which we may make adjustments include but are not limited to: amounts related to mark-to-market gains or losses (non-cash); recognition of contingencies; gains or losses associated with mergers, acquisitions, divestitures and other structural changes; charges related to restructuring programs such as the implementation of our Transformation strategy; asset impairments (non-cash); amounts related to changes in tax regulations or positions; amounts related to changes in foreign currency exchange rates and the impact of any hedging activities; other pension and postretirement related items; and debt modifications.
Acreditamos que essas medidas não GAAP forneçam informações adicionais significativas para ajudar os usuários das nossas demonstrações financeiras a compreenderem os nossos resultados financeiros e fluxos de caixa e avaliarem o nosso desempenho contínuo, pois excluem itens que podem não ser indicativos de nossas operações subjacentes ou que não estão relacionados com elas, e podem fornecer uma linha de base útil para analisar as tendências dos nossos negócios subjacentes. Management uses these non-GAAP financial measures in making financial, operating and planning decisions. We also use certain of these measures for the determination of incentive compensation awards.
Recomenda-se que as medidas financeiras não GAAP sejam consideradas um complemento, e não uma alternativa, aos resultados declarados preparados de acordo com as normas GAAP. Nossas informações financeiras não GAAP não representam uma base abrangente de contabilidade. Portanto, nossas informações financeiras não GAAP podem não ser comparáveis a medidas com títulos semelhantes declaradas por outras empresas.
Impacto de alterações de taxas de câmbio e atividades de hedging
We supplement the reporting of our revenue, revenue per piece and operating profit with non-GAAP measures that exclude the period-over-period impact of foreign currency exchange rate changes and hedging activities. Acreditamos que as informações de receita em moeda neutra, receita por peça e lucro operacional permitem que os usuários de nossas demonstrações financeiras compreendam as tendências de crescimento dos nossos produtos e resultados. We evaluate the performance of our International Package and Supply Chain and Freight segments on this currency-neutral basis.
A receita, a receita por peça e o lucro operacional com base cambial neutra, são calculados dividindo-se a receita, a receita por peça e o lucro operacional do período atual em dólares americanos pelas taxas de câmbio médias do período atual, a fim de derivar a receita, a receita por peça e o lucro operacional do período atual em moeda local. Os valores derivados são então multiplicados pelas taxas de câmbio médias usadas para converter os resultados comparáveis de cada mês do período do exercício anterior (incluindo o impacto de atividades de hedging cambial em relação ao mesmo período do exercício anterior). A diferença entre a receita, a receita por peça e o lucro operacional do período atual declarados em dólares americanos e a receita, a receita por peça e o lucro operacional do período atual derivados em dólares americanos representa o impacto de flutuações cambiais em relação ao mesmo período do exercício anterior.
Custos relacionados a contingências e despesas legais
We supplement the presentation of our operating profit, operating margin, pre-tax income, net income and earnings per share with similar non-GAAP measures that exclude the impact of costs related to certain of our legal contingencies and expenses. We believe this adjusted information provides a useful comparison of year-to-year financial performance without considering the impact of these contingencies and expenses. Avaliamos nosso desempenho nessa base ajustada.
Custos relacionados a programas de reestruturação; custos da estratégia de transformação
We supplement the presentation of our operating profit, operating margin, pre-tax income, net income and earnings per share with similar non-GAAP measures that exclude the impact of costs related to restructuring programs, including Transformation strategy costs. We believe this adjusted information provides a useful comparison of year-to-year financial performance without considering the short-term impact of restructuring costs. Avaliamos nosso desempenho nessa base ajustada.
Ajuste de pensão a valor de mercado e após aposentadoria
We recognize changes in the fair value of plan assets and net actuarial gains and losses in excess of a 10% corridor for company-sponsored pension and post-retirement obligations immediately as part of net periodic benefit cost other than service cost. We supplement the presentation of our pre-tax income, net income and earnings per share with similar non-GAAP measures that exclude the impact of the portion of net periodic benefit cost other than service cost represented by the gains and losses recognized in excess of the 10% corridor and the related income tax effects. We believe excluding these mark-to-market impacts from our adjusted results provides important supplemental information to remove the volatility caused by short term changes in market interest rates, equity prices, and similar factors.
This adjusted net periodic benefit cost ($754 million in 2019 and $615 million in 2018) is comparable to the accounting for our defined benefit plans in our quarterly reporting under U.S. GAAP, utilizing the expected return on plan assets (7.68% in 2019 and 2018) and the discount rate used to determine net periodic benefit cost (4.45% in 2019 and 3.81% in 2018). The non-adjusted net periodic benefit cost reflects the actual return on plan assets (17.57% in 2019 and -2.38% in 2018) and the discount rate used to measure the projected benefit obligation at the December 31 measurement date (3.55% in 2019 and 4.45% in 2018).
Os efeitos de imposto de renda diferidos do ajuste dessas pensões a valor de mercado e após aposentadoria são calculados pela multiplicação dos ajustes pelas alíquotas estatutárias aplicáveis em cada jurisdição fiscal, incluindo a jurisdição federal dos EUA e várias jurisdições estaduais e fora dos Estados Unidos. The blended average of the applicable statutory tax rates in 2019 and 2018 was 23.9% and 24.0%, respectively.
Fluxo de caixa livre e despesas de capital ajustadas
We supplement the reporting of cash flows from operating activities with free cash flow, free cash flow excluding discretionary pension contributions and free cash flow plus principal repayments of capital lease obligations, non-GAAP liquidity measures. We believe these free cash flow measures are important indicators of how much cash is generated by regular business operations and we use them as a measure of incremental cash available to invest in our business, meet our debt obligations and return cash to shareowners. Additionally, we believe that adjusting capital expenditures for principal repayments of capital lease obligations more appropriately reflects the overall cash that we have invested in capital assets.We calculate free cash flow as cash flows from operating activities less capital expenditures, proceeds from disposals of property, plant and equipment, and plus or minus the net changes in finance receivables and other investing activities. O fluxo de caixa livre, excluindo contribuições previdenciárias discricionárias, acrescenta novamente quaisquer contribuições previdenciárias discricionárias feitas durante o período.