UPS Triples Net Profit in Fourth Quarter

UPS nearly tripled its net profit in the fourth quarter, as a strong surge in international demand and unexpected domestic holiday shipping pushed earnings to $757 million at the end of the year, the carrier announced Tuesday.

UPS said reductions in costs and capacity also helped drive the improvement, with expenses falling 6.5 percent while revenue in the last three months of 2009 fell 2.5 percent to $12.4 billion.

But UPS’s domestic air express volume grew 3.5 percent in the fourth quarter, and international package volume jumped 11.8 percent over the same period a year ago, part of a broad expansion in demand reported across the air cargo industry.

UPS said its international revenue expanded 11.8 percent in the last three months of the year, giving that business a $467 million operating profit, a 27.6 percent improvement over the fourth quarter of 2008.

The gains late in the year were not enough to offset weakness earlier in 2009, and UPS counted a $2.15 billion profit for the full year, 28.3 percent behind 2008, on a 12 percent decline in revenue, to $45.3 billion.

The company says it expects only “gradual improvement” in the economy this year but says it’s encouraged by the adjustments it made in its own operations.

“UPS ended 2009 on a high note by leveraging network changes implemented throughout the year and executing flawlessly during the peak holiday shipping period, which was stronger than we had anticipated,” UPS Chairman and CEO Scott David said.

“UPS has emerged from the worst recession in decades leaner, more focused and better positioned to take advantage of increased global trade,” he said.