William B. Cassidy | Mar 17, 2011 10:48AM EDT
FedEx lowered its earnings forecast for 2011 as higher fuel costs and declining demand for domestic service clipped income in its most recent quarter.
Net income at the express giant dropped 3 percent year-over-year to $231 million in the quarter ending Feb. 28, although revenue rose 11 percent to $9.7 billion.
Unusually severe winter storms during the December-February quarter disrupted operations, decreased shipping demand and increased costs, the company said.
Costs related to the merger of industrial trucking units FedEx Freight and FedEx National LTL, completed Jan. 30, also reduced earnings, according to FedEx.
FedEx said it expects to post full-year earnings of $4.83 to $5 a share, compared with a previous forecast of $5 to $5.30 a share, at the end of its fiscal year May 31.
-- Contact William B. Cassidy at wcassidy@joc.com.