The courier, an economic bellwether, said the U.S. economy is growing at a ''slower pace'' but was optimistic about its international business. Fred Katayama reports.
UPS' strong international business helped net profit nearly tripled in the latest quarter, speeding past analysts estimates. The world's largest package courier widened its margins by boosting shipment volume and hiking prices. UPS also managed to raise operating profit at its domestic package and freight businesses. UPS expanded earnings even though the stronger dollar and lower fuel surcharges hurt overall revenue. As the price of oil falls, so do surcharges which curb revenue. UPS, often seen by investors as an economic bellwether said, the U.S. economy appears to be growing at a "slower pace." But it now sees itself attaining earnings at the higher end of its previous forecast due to the momentum in its international business. RBC Capital analyst John Barnes called the results "solid," saying, "Their second quarter earnings performance gave them breathing room. It seems like they're now saying they're comfortable with their guidance range." UPS' stock, which has underperformed rival FedEx this year, rose in early trading.