FedEx raises fiscal second-quarter forecast

08/12/2009 - 12:42

CHICAGO (Reuters) - FedEx Corp said on Monday that its second-quarter earnings would easily beat its previous forecast, citing strong growth in international demand for its air services, especially in Asia and Latin America, and its shares rose more than 3 percent.

FEDEX (FDX.NY)aid it now expects to report earnings for the second-quarter which ended November 30 of $1.10 a share, above the range of 65 to 95 cents a share the company had previously predicted. The company earned $1.58 a share a year ago.

Analysts, on average, expected the Memphis-based company to report a second-quarter profit of 85 cents a share, according to Thomson Reuters I/B/E/S.

FedEx said the improved outlook reflects "better-than-expected growth in FedEx International Priority and FedEx Ground volumes" as well as "the benefits of ongoing cost control programs."

It was the second quarter in a row that FedEx preannounced expectation-topping earnings.

Analysts say the company is positioned to benefit from even a modest economic recovery because as shipping activity ticks up and its underutilized aircraft begin to carry larger cargoes, FedEx's margins improve.

FedEx shares rose to $90.35 after closing at $87.52 on the New York Stock Exchange.

The company is due to report second-quarter earnings on December 17.

(Reporting by James B. Kelleher; editing by Carol Bishopric)