SEATTLE,WA -- April 24, 2000
Airborne Freight Corporation (NYSE: ABF), which operates under the trade name Airborne Express, today reported first quarter net earnings of $32,105,000, or $.65 per share on a diluted basis. Before a credit due to a change in accounting for certain engine overhaul costs, net earnings were $17,899,000, or $.36 per share. Net earnings in last year’s first quarter were $25,244,000, or $.51 per share.

Effective January 1, 2000, the company changed from the accrual method of accounting for DC-9 engine overhaul costs to the direct expense method where costs are expensed as incurred. The cumulative effect of this change in accounting resulted in a non-cash credit of $14,206,000, net of taxes, or $.29 per share on a diluted basis.

Total revenues for first quarter were $812,464,000 an increase of 5.6 percent over 1999 first quarter revenues of $769,348,000. Domestic revenues were up 6.5 percent at $725,252,000 compared to last year’s figure of $681,261,000. International revenues for this period decreased 1.0 percent and were $87,212,000 compared to $88,087,000 in 1999.

The total number of shipments for the first quarter increased 3.5 percent to 83,374,000. Domestic shipments were 81,751,000, up 3.6 percent and international shipments were 1,623,000, a decrease of 3.2 percent over 1999 results. However, there were two more operating days in the first quarter of 2000 versus 1999, resulting in domestic shipments increasing 0.5 percent on a per day basis. "The escalating cost of jet fuel obviously had a negative impact on operating results in the first quarter," said Roy Liljebeck, Airborne’s Chief Financial Officer. "The net increase of jet fuel in the first quarter of 2000 versus 1999 was $.395 per gallon, equal to an increase of $18,047,000. On February 7, the company implemented a 3 percent fuel surcharge to help offset the increasing cost. As a result, $12,498,000 was billed under this surcharge in the first quarter to help offset the increased jet fuel cost," continued Liljebeck.

"Although domestic shipments in the first quarter grew only 0.5 percent on a per day basis, it was the first quarter in the last four quarters that some growth was experienced. While very modest, it is hopefully a sustainable trend that can be built upon. Also encouraging is the 1 percent improvement in productivity achieved in the first quarter," concluded Liljebeck.

For more than 50 years, Airborne Express has served the shipping needs of business customers around the world. Today, Airborne offers total distribution solutions by providing customers 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, air freight, ocean service, and international warehousing.