FedEx Corp. cut its quarterly earnings forecast by 25 cents a share, due to rising fuel prices and winter storms that slowed its operations.
The company’s adjusted earnings excluding FedEx Freight combination costs will be 70 cents 90 cents per share for fiscal third-quarter ending Feb. 28, down from its previous guidance of 95 cents to $1.15 per share.
“We experienced significant network disruptions in the U.S. and Europe and unusually high costs from severe winter storms,” Chief Financial Officer Alan Graf said in a statement.
He said that “fuel prices continued to escalate since we provided our earnings outlook in December” and added that FedEx “continues to see strength in our base business across all transportation segments and geographies.”
Diesel has soared since late November, rising more than 37 cents in 11 straight gains to top $3.50 a gallon, while gasoline has increased in 10 of the past 11 weeks to $3.14 a gallon.
The added costs also will impact FedEx’s full-year earnings, the company said.
FedEx, ranked No. 2 on the Transport Topics 100 listing of U.S. and Canadian for-hire carriers, will release its third-quarter earnings on March 17.
