FedEx Corporation (FDX)
Q1 2011 Earnings Call Transcript
September 16, 2010 8:30 a.m. ET

Executives

Mickey Foster – Vice President, Investor Relations
Frederick W. Smith – Chairman, President and Chief Executive Officer
Alan B. Graf Jr. – Executive Vice President and Chief Financial Officer
William J. Logue – President and Chief Executive Officer, FedEx Freight Corp.
David J. Bronczek – President and Chief Executive Officer, FedEx Express
T. Michael Glenn – Executive Vice President, Market Development and Corporate Communications
Christine P. Richards – Executive Vice President, General Counsel and Secretary
David F. Rebholz – President and Chief Executive Officer, FedEx Ground

Analysts

Thomas Wadewitz – J.P. Morgan
Gary Chase – Barclays Capital
Robert Pickels – Manning & Napier
Ken Hoexter – Bank of America/Merrill Lynch
Justin Yagerman – Deutsche Bank
Matthew Brooklier – Piper Jaffray
Art Hatfield – Morgan Keegan
David Ross – Stifel Nicolaus
Jon Langenfeld – Robert W. Baird & Co.
William Greene – Morgan Stanley
Edward Wolfe – Wolfe Research
Scott Malat – Goldman Sachs
Christopher Ceraso – Credit Suisse
Scott Flower – Macquarie Securities

Presentation

Operator

Good day everyone and welcome to the FedEx Corporation First Quarter Earnings Conference Call. Today''s call is being recorded. At this time, I will turn the call over to Mickey Foster, Vice President of Investor Relations for FedEx Corporation. Please go ahead.

Mickey Foster

Good morning and welcome to FedEx Corporation''s first quarter earnings conference call. I would like to remind everyone we are having an investor meeting here in Memphis in less than two weeks, on Tuesday and Wednesday, September 28 and 29. If you’ve not registered, please do so right away. The first quarter earnings release and 25-page stat book are on our website at fedx.com. This call is being broadcast from our website and the replay and podcast download will be available for approximately one year.

Joining us on the call today are members of the media. During our question-and-answer session, callers will be limited to one question and a follow-up so we can accommodate all those who would like to participate. I want to remind all listeners that FedEx Corporation desires to take advantage of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.

Certain statements in this conference call may be considered forward-looking statements within the meaning of the Act. Such forward-looking statements are subject to risks, uncertainties and other factors which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. For additional information on these factors, please refer to our press releases and filings with the SEC.

In our earnings release, we include certain non-GAAP financial measures which we may discuss on this call. Please refer to the release, available on our website, for further discussion of these measures and a reconciliation of them to the most directly comparable GAAP measures.

To the extent, we disclose any other non-GAAP financial measures on this call, please refer to the investor relations portion of our website at fedex.com for a reconciliation of such measures to the most directly comparable GAAP measures.

Joining us on the call today are Fred Smith, Chairman, President and CEO; Alan Graf, Executive Vice President and CFO; Chris Richards, Executive Vice President, General Counsel and Secretary; Mike Glenn, President and CEO of FedEx Services; Rob Carter, Executive Vice President FedEx Information Services and CIO; Dave Bronczek, President and CEO of FedEx Express; Dave Rebholz, President and CEO of FedEx Ground and Bill Logue, President and CEO of FedEx Freight.

Now, our Chairman, Fred Smith, will share his views on the quarter followed by Alan Graf. After Alan, we will have question and answers.

Frederick W. Smith

Thank you, Mickey. Good morning and welcome to our conference call to discuss earnings for the first quarter of fiscal year ''11. Improved global economic conditions fuel strong demand for our services, increasing volumes and revenue per package at FedEx Express and FedEx Ground.

We expect a phase of somewhat slower economic growth going forward. The recovery began a year ago and we believe slower growth is consistent with historical business cycles. In any case, the economic environment and growth prospects are much improved from a year ago. We believe drivers of sustainable growth are in place, such as stronger corporate balance sheets and pent-up demand. We are confident the economic activities will continue to expand.

FedEx is taking full advantage of the global economic recovery because of the action we have taken to manage our costs, strategically invest in key global growth markets, acquire more efficient aircraft, streamline our networks and focus on our customers. We are optimistic about being able to improve our earnings in the years to come and resuming our growth trajectory that was the case prior to the recession.