EARNINGS DROP FORCES FEDERAL TO HIKE PRICES

EARNINGS DROP FORCES FEDERAL TO HIKE PRICES

Federal Express Corp., beset by falling earnings, is raising prices April 1.

Federal Express seeks to offset increased operating costs domestically and expenses in connection with the costly acquisition last year of Tiger International Inc.Federal Express earned a paltry $5.2 million, or 10 cents a share, on revenue of $1.7 billion during its fiscal third quarter ended Feb. 28. That compares with earnings of $24.8 million, or 47 cents a share, on revenue of $1.3 billion in the same period the year before.

For nine months, Federal earned $72.6 million, or $1.37 a share, on revenue of $5.1 billion, compared with net income of $143 million, or $2.75 a share, on revenue of $3.5 billion during the year-earlier period.

Effective April 1, Federal Express' charge for overnight domestic shipments, up to 150 pounds, increases from 2 percent to 6 percent on average. The hike for deferred, next-afternoon shipments averages from 4 percent to 10 percent, a spokesman said.