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Tom Branigan (206) 298-3185
Tom Branigan (206) 298-3185
AIRBORNE FREIGHT CORPORATION REPORTS THIRD QUARTER 1996 RESULTS
SEATTLE -- October 28, 1996
Airborne Freight Corporation (NYSE: ABF), which operates under the trade name Airborne Express, today reported net earnings available to common shareholders of $4,642,000, or $.22 per share for the third quarter ended September 30, 1996. This compares to net earnings of $7,633,000, or $.36 per share for the same period last year.
Total revenues for third quarter 1996 were $612,027,000, a 9 percent increase over 1995 third quarter revenues of $560,565,000. Domestic revenues of $522,040,000 were 11.5 percent higher than 1995 third quarter domestic revenues of $468,275,000. International revenues were down 2.5 percent to $89,987,000 versus last year's international revenues of $92,290,000.
Net earnings available to common shareholders for the first nine months of 1996 were $16,509,000, or $.78 per share versus $11,636,000, or $.55 per share for 1995. Total revenues for the first nine months of 1996 were 12 percent higher at $1,832,334,000, compared to $1,636,421,000 for the same nine month period in 1995. Domestic revenues were $1,552,216,000, an increase of 14 percent over 1995 revenues of $1,363,083,000. International revenues for this period reached $280,118,000, 2.5 percent higher than 1995 international revenues of $273,338,000.
Airborne's total shipments during third quarter 1996 increased 11 percent to 64,219,000 versus 57,791,000 in third quarter 1995. Domestic shipments reached 62,968,000, an increase of 11 percent over last year's shipments of 56,614,000. International shipments gained 6 percent to reach 1,251,000 compared to 1,177,000 for the same period in 1995. The third quarter of 1996 was aided by one additional business day than the 1995 third quarter.
Total shipments for the nine months were 192,429,000, up 14.5 percent over 1995. Domestic shipments for the nine months increased 15 percent to 188,695,000, and international shipments increased 10 percent to reach 3,734,000.
"The slowdown in the growth of domestic business, which began late in this year's second quarter, had a negative impact on third quarter 1996," said Roy Liljebeck, Airborne's Chief Financial Officer. "Domestic shipments on a year-over-year basis were up 16.5 percent in the first half of 1996, but the growth rate dropped to 11 percent in the third quarter. We believe the slower growth is a function of a slowdown of business activity in some of our key customer segments."
"With a slower growth rate, we also were not as efficient at lowering our operating cost per shipment when compared to last year's third quarter, showing only a 1 percent improvement. Also hindering improvement in operating costs was the cost of jet fuel and the fuel excise tax. Compared to the price of jet fuel in last year's third quarter, this year's price was 13.7 cents per gallon higher. Applied to this year's consumption, the higher price increased fuel costs by $5.4 million in the third quarter of 1996," continued Liljebeck.
"International business activity slowed in the third quarter, but some of that slowdown was by design. We have chosen to be less price aggressive in pursuing some heavy weight freight business," said Liljebeck. "As a result, international revenue decreased 2.5 percent in the quarter, but the margin on all international traffic was 6 percent higher than in last year's third quarter."
"A positive trend continues in the pricing and resulting yields in domestic business. For the second quarter in a row, domestic revenue growth equaled, and in fact slightly exceeded, the shipment growth rate. A continuation of that trend should enhance operating results in future periods," concluded Liljebeck.
For more than 50 years, Airborne Express has served shipping needs of business customers around the world. Today, Airborne offers total distribution solutions by providing time-sensitive delivery of documents, letters, small packages and freight to virtually every U.S. ZIP code and more than 200 countries. Customers can select from a variety of services including same-day, next-morning, next-afternoon or second-day delivery, ocean service and logistics management.