FedEx Q1 Profits Down 22%

September 18, 2008 5:56 p.m. EST

Memphis, TN (AHN) - FedEx Corp. announced Thursday fiscal first quarter profits dropping 22 percent despite a growth in freight handled.

FedEx said a weak global economy and record-high oil prices impacted the courier's bottom line. Plans are underway to increase shipping rates by 6.9 percent.

The quarter's net income dropped to $384 million or $1.23 a share from $494 million or $1.58 a share over the same quarter last year. Revenues were up $9.97 billion from $9.2 billion.

FedEx Express segment's operating income dropped 34 percent to $345 million, while revenues rose 9 percent to $6.42 billion boosted by fuel surcharges.

FedEx's fuel-related expenses increased 66 percent to $1.6 billion from $964 million.

International freight volume was flat, while U.S. deliveries decreased 5 percent.