July 29, 2014: UPS made $454 million in after-tax profits and transferred liability for future retiree healthcare costs to Teamcare.
UPS announced $454 million in profits for the 2nd quarter today. That’s down from $1.07 billion for the same period last year.
But don’t cry for Big Brown just yet. The company’s 54% drop in profits is explained by a one-time charge.
UPS posted a one-time $665 million after-tax charge on its books related to the company’s transfer of retiree healthcare benefits to Teamcare for all Teamsters who retire January 1 this year or after.
That Teamcare transfer aside, UPS made $1.2 billion for the quarter, an increase over last year. U.S. revenue rose by 5.2 percent to $8.67 billion. Daily package volume grew by 7.4 percent.
UPS Freight and supply chain revenue rose by 7 percent to $2.35 billion.
Volume is expected to grow. UPS is investing $175 million in peak operations to avoid a repeat of last year when the online sales boom caught the company flatfooted and humiliated executives in Atlanta.
In one negative, profit per package is actually down. The rapid growth in UPS SurePost was the primary cause of the reduction, Nasdaq reports.
The contract includes new language on SurePost that Hoffa and Hall claim will mean fewer packages diverted to the Post Office and more fulltime Teamster driving jobs. But will they enforce it? Click here for tips on documenting violations and pressing Hoffa and Hall to deliver on their Surepost promises.
For more press coverage on UPS profits, check out:
UPS invests $175 million in peak operations
UPS 2nd qt profits improve, excluding pension charge