FedEx lowers earnings forecasts and talks of a slower global economy
‘FedEx projects earnings to be $1.40 to $1.60 per diluted share in the second quarter and $6.25 to $6.75 per diluted share for fiscal 2012, compared to the company’s previous full year forecast of $6.35 to $6.85 per diluted share’
Interestingly they cite particular weakness in Asia
‘While FedEx Ground and FedEx Freight achieved improved operating results despite lower than expected growth, the more rapid decline in demand for FedEx Express services, particularly fromAsia , outpaced our ability to reduce operating costs. We have slightly reduced our earnings forecast to reflect current business conditions and are aggressively working to adjust our cost structure to match demand levels.’
This is very disappointing, especially given their previously bullish outlook. Their previous outlook was featured in an Earnings View post linked here. This is undoubtedly a sign that global growth is slowing and the idea of a second half snapback in Global GDP growth is a myth.
