For Immediate Release
Contacts:
                         Steve Gaut, Public Relations
 
                         404-828-8787
 
                         Scott Childress, Investor Relations
 
                         404-828-7957

UPS DELIVERS 1Q 2018 EPS OF $1.55, UP 17%

•
International Revenue and Operating Profit Climb 15%
•
Average Daily Exports grew 12%, Led by Europe and U.S. Trade Lanes
•
Supply Chain & Freight Operating Profit up 14% on 16% Revenue Growth
•
U.S. Domestic Revenue Rises 7.2% on 4.6% Volume Growth
•
Weather Conditions Muted First Quarter U.S. Domestic Results
•
Cash from Operations of $4.1B Resulted in Free Cash Flow* of $2.6B
•
Reaffirms Full-Year 2018 Adjusted EPS Guidance


ATLANTA - April 26, 2018 - UPS (NYSE:UPS) today announced that first-quarter 2018 earnings per share rose 17% to $1.55, led by double-digit operating profit growth in both International and Supply Chain and Freight segments. “Top-line growth in our business was strong across all business segments, reflecting the power of UPS’s global solutions and continued favorable economic conditions,” said UPS Chairman and CEO David Abney. “When combined with our transformation initiatives, these favorable trends position UPS for strong returns going forward.”

Consolidated Results
1Q 2018
 
1Q 2017
 
% Change
Revenue
$17,113 M
 
$15,510 M
 
10%
Net income
$1,345 M
 
$1,166 M
 
15%
Diluted earnings per share
$1.55
 
$1.33
 
17%

For the total company in 1Q 2018:
•
Total revenue increased 10% to $17.1 billion, on strong demand for UPS solutions.
•
Average yield increased by 4.3%, led by International and U.S. Deferred Air products.
•
UPS rewarded shareowners by increasing dividends per share by nearly 10% over the prior year, and distributing $840 million during the quarter.
•
To support investment strategies the company made capital expenditures of $1.5 billion.
•
The lower effective tax rate reflects a more competitive U.S. tax structure, some discrete tax items and includes the impact of share-based compensation.
•
First quarter results include the adoption of new accounting standards for pension and revenue recognition. Prior-period results were also recast to reflect these changes.


* Information on non-GAAP financial measures is attached to this press release. 

- more -



2-2-2

U.S. Domestic Segment

The U.S. Domestic segment experienced strong demand as customers increasingly chose UPS solutions. Both unexpected and planned items weighed on operating profit for the segment during the first quarter.

 
1Q 2018
 
1Q 2017
Revenue
$10,227 M
 
$9,536 M
Operating profit
$756 M
 
$950 M

For the U.S. Domestic segment in 1Q 2018:
•
Revenue increased to $10.2 billion, up 7.2% over 1Q 2017. Revenue improved across all products, signaling the strong market demand for UPS solutions.
•
Revenue per piece increased 2.6% as higher base-rate pricing and fuel surcharges offset headwinds from customer and product mix.
•
Operating profit includes headwinds from severe winter weather of $85 million, Saturday deployment, network projects and higher pension expenses.


International Segment

“The execution of our diversified global strategies and our investments produced double-digit growth in revenue and profit,” said Abney. “Each of our International regions is contributing to our financial gains, and we expect this strong momentum to continue.”

 
1Q 2018
 
1Q 2017
Revenue
$3,533 M
 
$3,074 M
Operating profit
$594 M
 
$518 M

For the International segment in 1Q 2018:
•
International revenue increased 15% despite two fewer operating days in many countries. Currency-neutral revenue increased 8.7%.
•
Export, Domestic and Cargo product groups all achieved double-digit revenue growth.
•
Export shipments per day grew an average 12% as premium products continue to outpace non-premium.
•
Export volume growth in Europe and the U.S. continued to be strong for the quarter.
•
Operating profit was $594 million, up 15% on higher Export shipments and expanded product yields. Currency-neutral operating profit increased 10%.


* Information on non-GAAP financial measures is attached to this press release. 

- more -




3-3-3

Supply Chain and Freight Segment

The Supply Chain and Freight segment produced another quarter of strong financial results. Revenue and operating profit grew by double digits due to successful revenue-quality initiatives, opportunistic growth strategies and structural cost reductions.

 
1Q 2018
 
1Q 2017
Revenue
$3,353 M
 
$2,900 M
Operating profit
$170 M
 
$149 M

For the Supply Chain and Freight segment in 1Q 2018:
•
Revenue increased to $3.4 billion, up 16% over 1Q 2017. The business units focused on high quality, middle-market customers.
•
The Forwarding business led all units with 27% revenue growth, as revenue management initiatives and stable market conditions drove top-line gains.
•
UPS Freight revenue increased 9.9% on solid LTL (less-than-truckload) pricing and tonnage growth.
•
Operating profit was $170 million, up 14% from the same quarter in 2017.


Outlook

The company provides guidance on an adjusted (non-GAAP) basis because it is not possible to predict or provide a reconciliation reflecting the impact of future pension mark-to-market adjustments or other unanticipated events, which would be included in reported (GAAP) results and could be material.

“Our focused business strategies are producing strong results in both the International and Supply Chain segments,” said Richard Peretz, UPS’s chief financial officer. “The benefits from our investments, new multi-year transformation efficiencies and stronger pricing position us well for shareowner value creation.”

•
UPS expects 2018 adjusted diluted earnings per share to be in a range of $7.03 to $7.37.
•
The company projects free cash flow of $4.5 billion to $5.0 billion in 2018.
•
The effective tax rate should be in a range of 23% to 24% for the remainder of the year.
•
Capital expenditures in 2018 are planned between $6.5 billion to $7.0 billion.

# # #




Conference Call Information
    
UPS CEO David Abney and CFO Richard Peretz will discuss first-quarter results with investors and analysts during a conference call at 8:30 a.m. ET, April 26, 2018. That call is open to others through a live Webcast. To access the call, go to www.investors.ups.com and click on “Earnings Webcast.”






About UPS

UPS (NYSE: UPS) is a global leader in logistics, offering a broad range of solutions including transporting packages and freight; facilitating international trade, and deploying advanced technology to more efficiently manage the world of business. Headquartered in Atlanta, UPS serves more than 220 countries and territories worldwide. The company can be found on the web at ups.com or pressroom.ups.com and its corporate blog can be found at longitudes.ups.com. To get UPS news direct, follow @UPS_News on Twitter.

Forward-Looking Statements
Except for historical information contained herein, the statements made in this release constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements, including statements regarding the intent, belief or current expectations of UPS and its management regarding the company's strategic directions, prospects and future results, involve certain risks and uncertainties.
Certain factors may cause actual results to differ materially from those contained in the forward-looking statements, including economic and other conditions in the markets in which we operate, governmental regulations (including tax laws and regulations), our competitive environment, changes in the facts or assumptions underlying our health and pension benefit funding obligations, negotiation and ratification of labor contracts, strikes, work stoppages and slowdowns, changes in aviation and motor fuel prices, cyclical and seasonal fluctuations in our operating results, and other risks discussed in the company's Form 10-K and other filings with the Securities and Exchange Commission, which discussions are incorporated herein by reference.
Reconciliation of GAAP and non-GAAP Financial Measures
We supplement the reporting of our financial information determined under generally accepted accounting principles ("GAAP") with certain non-GAAP financial measures, including, as applicable, "as adjusted" operating profit, operating margin, other income (expense), pre-tax income, net income and earnings per share. The equivalent measures determined in accordance with GAAP are also referred to as "reported" or "unadjusted.” Additionally, we periodically disclose free cash flow, free cash flow excluding discretionary pension contributions, as well as currency-neutral revenue, revenue per piece and operating profit.
We consider quantitative and qualitative factors in assessing whether to adjust for the impact of items that may be significant or that could affect an understanding of our ongoing financial and business performance or trends. Examples of items for which we may make adjustments include but are not limited to: amounts related to mark-to-market gains or losses (non-cash); settlement of contingencies; gains or losses associated with mergers, acquisitions, divestitures and other structural changes; charges related to restructuring programs; asset impairments (non-cash); amounts related to changes in tax regulations or positions; pension and postretirement related items; and debt modifications.
We believe that these non-GAAP measures provide additional meaningful information to assist users of our financial statements in understanding our financial results, cash flows and assessing our ongoing performance because they exclude items that may not be indicative of, or are unrelated to, our underlying operations and may provide a useful baseline for analyzing trends in our underlying businesses. Management uses these non-GAAP financial measures in making financial, operating and planning decisions. We also use certain of these measures for the determination of incentive compensation award results.



Non-GAAP financial measures should be considered in addition to, and not as an alternative for, our reported results prepared in accordance with GAAP. Our non-GAAP financial information does not represent a comprehensive basis of accounting. Therefore, our non-GAAP financial information may not be comparable to similarly titled measures reported by other companies.
Currency-Neutral Revenue, Revenue per Piece and Operating Profit
We supplement the reporting of our revenue, revenue per piece and operating profit with similar non-GAAP measures that exclude the period-over-period impact of foreign currency exchange rate changes and hedging activities. We believe currency-neutral revenue, revenue per piece and operating profit information allows users of our financial statements to understand growth trends in our products and results. We evaluate the performance of our International Package and Supply Chain and Freight businesses on a currency-neutral basis.
Currency-neutral revenue, revenue per piece and operating profit are calculated by dividing current period reported U.S. dollar revenue, revenue per piece and operating profit by the current period average exchange rates to derive current period local currency revenue, revenue per piece and operating profit. The derived current period local currency revenue, revenue per piece and operating profit are then multiplied by the average foreign exchange rates used to translate the comparable results for each month in the prior year period (including the period over period impact of foreign currency revenue hedging activities). The difference between the current period reported U.S. dollar revenue, revenue per piece and operating profit and the derived current period U.S. dollar revenue, revenue per piece and operating profit is the period over period impact of currency fluctuations.
Free Cash Flow
We supplement the reporting of cash flows from operating activities with free cash flow, a non-GAAP liquidity measure. We believe free cash flow is an important indicator of how much cash is generated by regular business operations and we use it as a measure of incremental cash available to invest in our business, meet our debt obligations and return cash to shareowners. We calculate free cash flow as cash flows from operating activities less capital expenditures, proceeds from disposals of property, plant and equipment, and plus or minus the net changes in finance receivables and other investing activities.






Reconciliation of GAAP and non-GAAP Revenue, Revenue Per Piece and Operating Profit
(in millions, except Per Piece amounts):

Three Months Ended March 31
 
2018 As- Reported (GAAP)
 
2017 As- Reported (GAAP)
% Change (GAAP)
 
Currency Impact
 
2018 Currency- Neutral
(non-GAAP)
% Change (non-GAAP)
 
 
 
 
 
 
 
 
 
 
Average Revenue Per Piece:
 
 
 
 
 
 
 
 
 
International Package:
 
 
 
 
 
 
 
 
 
   Domestic
$
6.70

 
$
5.69

17.8
 %
 
$
(0.74
)
 
$
5.96

4.7
 %
   Export
28.87

 
28.15

2.6
 %
 
(1.21
)
 
$
27.66

(1.7
)%
      Total International Package
$
16.99

 
$
15.47

9.8
 %
 
$
(0.96
)
 
$
16.03

3.6
 %
 
 
 
 
 
 
 
 
 
 
Consolidated
$
10.97

 
$
10.52

4.3
 %
 
$
(0.16
)
 
$
10.81

2.8
 %
 
 
 
 
 
 
 
 
 
 
Revenue:
 
 
 
 
 
 
 
 
 
  U.S. Domestic Package
$
10,227

 
$
9,536

7.2
 %
 
$
—

 
$
10,227

7.2
 %
  International Package
3,533

 
3,074

14.9
 %
 
(193
)
 
$
3,340

8.7
 %
  Supply Chain & Freight
3,353

 
2,900

15.6
 %
 
(51
)
 
$
3,302

13.9
 %
  Total revenue
$
17,113

 
$
15,510

10.3
 %
 
$
(244
)
 
$
16,869

8.8
 %
 
 
 
 
 
 
 
 
 
 
Operating Profit:
 
 
 
 
 
 
 
 
 
  U.S. Domestic Package
$
756

 
$
950

(20.4
)%
 
$
—

 
$
756

(20.4
)%
  International Package
594

 
518

14.7
 %
 
(22
)
 
572

10.4
 %
  Supply Chain & Freight
170

 
149

14.1
 %
 
(1
)
 
169

13.4
 %
  Total operating profit
$
1,520

 
$
1,617

(6.0
)%
 
$
(23
)
 
$
1,497

(7.4
)%































Reconciliation of GAAP and non-GAAP Liquidity Measures (in millions)


Three Months Ended March 31
 
 
 
Net Increase in Cash, Cash Equivalents and Restricted Cash
 
 
 
 
 
 
 
 
Preliminary
2018
Cash flows from operating activities
 
$
4,067

Cash flows used in investing activities
 
(1,446
)
Cash flows used in financing activities
 
(2,550
)
 
 
 
Effect of exchange rate changes on cash, cash equivalents and restricted cash
 
(14
)
Net increase in cash, cash equivalents and restricted cash
 
$
57

 
 
 
Reconciliation of Free Cash Flow (non-GAAP)
 
 
 
 
 
Preliminary
2018
 
 
 
Cash flows from operating activities (GAAP)
 
$
4,067

Capital expenditures
 
(1,537
)
Proceeds from disposals of PP&E
 
20

Net change in finance receivables
 
—

Other investing activities
 
2

     Free cash flow (non-GAAP)
 
$
2,552







United Parcel Service, Inc.
Selected Financial Data - First Quarter
(unaudited)
 
Three Months Ended
 
 
 
 
 
March 31
 
 
 
2018
 
2017
 
Change
 
% Change
(amounts in millions, except per share data)
 
 
 
 
 
 
 
Statement of Income Data:
 
 
 
 
 
 
 
Revenue:
 
 
 
 
 
 
 
  U.S. Domestic Package
$
10,227

 
$
9,536

 
$
691

 
7.2
 %
  International Package
3,533

 
3,074

 
459

 
14.9
 %
  Supply Chain & Freight
3,353

 
2,900

 
453

 
15.6
 %
  Total revenue
17,113

 
15,510

 
1,603

 
10.3
 %
 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
  Compensation and benefits
9,045

 
8,311

 
734

 
8.8
 %
  Other
6,548

 
5,582

 
966

 
17.3
 %
  Total operating expenses
15,593

 
13,893

 
1,700

 
12.2
 %
 
 
 
 
 
 
 
 
Operating profit:
 
 
 
 
 
 
 
  U.S. Domestic Package
756

 
950

 
(194
)
 
(20.4
)%
  International Package
594

 
518

 
76

 
14.7
 %
  Supply Chain & Freight
170

 
149

 
21

 
14.1
 %
  Total operating profit
1,520

 
1,617

 
(97
)
 
(6.0
)%
 
 
 
 
 
 
 
 
Other income (expense):
 
 
 
 
 
 
 
  Other pension income (expense)
285

 
180

 
105

 
58.3
 %
  Investment income and other
9

 
15

 
(6
)
 
(40.0
)%
  Interest expense
(153
)
 
(102
)
 
(51
)
 
50.0
 %
  Total other income (expense)
141

 
93

 
48

 
51.6
 %
 
 
 
 
 
 
 
 
Income before income taxes
1,661

 
1,710

 
(49
)
 
(2.9
)%
 
 
 
 
 
 
 
 
Income tax expense
316

 
544

 
(228
)
 
(41.9
)%
 
 
 
 
 
 
 
 
Net income
$
1,345

 
$
1,166

 
$
179

 
15.4
 %
 
 
 
 
 
 
 
 
Net income as a percentage of revenue
7.9
%
 
7.5
%
 
 
 
 
 
 
 
 
 
 
 
 
Per share amounts:
 
 
 
 
 
 
 
  Basic earnings per share
$
1.55

 
$
1.33

 
$
0.22

 
16.5
 %
  Diluted earnings per share
$
1.55

 
$
1.33

 
$
0.22

 
16.5
 %
 
 
 
 
 
 
 
 
Weighted-average shares outstanding:
 
 
 
 
 
 
 
  Basic
866

 
874

 
(8
)
 
(0.9
)%
  Diluted
870

 
879

 
(9
)
 
(1.0
)%











Certain prior year amounts have been reclassified to conform to the current year presentation.



United Parcel Service, Inc.
Selected Operating Data - First Quarter
(unaudited)
 
Three Months Ended
 
 
 
 
 
March 31
 
 
 
 
 
2018
 
2017
 
Change
 
% Change
 
 
 
 
 
 
 
 
Revenue (in millions):
 
 
 
 
 
 
 
U.S. Domestic Package:
 
 
 
 
 
 
 
   Next Day Air
$
1,784

 
$
1,665

 
$
119

 
7.1
 %
   Deferred
1,069

 
970

 
99

 
10.2
 %
   Ground
7,374

 
6,901

 
473

 
6.9
 %
      Total U.S. Domestic Package
10,227

 
9,536

 
691

 
7.2
 %
International Package:
 
 
 
 
 
 
 
   Domestic
716

 
613

 
103

 
16.8
 %
   Export
2,672

 
2,337

 
335

 
14.3
 %
   Cargo and Other
145

 
124

 
21

 
16.9
 %
      Total International Package
3,533

 
3,074

 
459

 
14.9
 %
Supply Chain & Freight:
 
 
 
 
 
 
 
Forwarding
1,605

 
1,266

 
339

 
26.8
 %
Logistics
782

 
740

 
42

 
5.7
 %
   Freight
777

 
707

 
70

 
9.9
 %
   Other
189

 
187

 
2

 
1.1
 %
      Total Supply Chain & Freight
3,353

 
2,900

 
453

 
15.6
 %
Consolidated
$
17,113

 
$
15,510

 
$
1,603

 
10.3
 %
 
 
 
 
 
 
 
 
Consolidated volume (in millions)
1,241

 
1,187

 
54

 
4.5
 %
 
 
 
 
 
 
 
 
Operating weekdays
64

 
64

 
—

 
—
 %
 
 
 
 
 
 
 
 
Average Daily Package Volume (in thousands):
 
 
 
 
 
 
 
U.S. Domestic Package:
 
 
 
 
 
 
 
   Next Day Air
1,437

 
1,315

 
122

 
9.3
 %
   Deferred
1,297

 
1,243

 
54

 
4.3
 %
   Ground
13,545

 
13,008

 
537

 
4.1
 %
      Total U.S. Domestic Package
16,279

 
15,566

 
713

 
4.6
 %
International Package:
 
 
 
 
 
 
 
   Domestic
1,670

 
1,683

 
(13
)
 
(0.8
)%
   Export
1,446

 
1,297

 
149

 
11.5
 %
      Total International Package
3,116

 
2,980

 
136

 
4.6
 %
Consolidated
19,395

 
18,546

 
849

 
4.6
 %
 
 
 
 
 
 
 
 
Average Revenue Per Piece:
 
 
 
 
 
 
 
U.S. Domestic Package:
 
 
 
 
 
 
 
   Next Day Air
$
19.40

 
$
19.78

 
$
(0.38
)
 
(1.9
)%
   Deferred
12.88

 
12.19

 
0.69

 
5.7
 %
   Ground
8.51

 
8.29

 
0.22

 
2.7
 %
      Total U.S. Domestic Package
9.82

 
9.57

 
0.25

 
2.6
 %
International Package:
 
 
 
 
 
 
 
   Domestic
6.70

 
5.69

 
1.01

 
17.8
 %
   Export
28.87

 
28.15

 
0.72

 
2.6
 %
      Total International Package
16.99

 
15.47

 
1.52

 
9.8
 %
Consolidated
$
10.97

 
$
10.52

 
$
0.45

 
4.3
 %



Certain prior year amounts have been reclassified to conform to the current year presentation.




United Parcel Service, Inc.
Supplemental Analysis of Currency and UPS Freight - First Quarter
Currency Neutral Revenue Per Piece
(unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
 
Currency
 
 
 
March 31
 
 
 
Neutral
 
2018
 
2017
 
% Change
 
Currency
 
2018*
 
% Change
 
 
 
 
 
 
 
 
 
 
 
 
Average Revenue Per Piece:
 
 
 
 
 
 
 
 
 
 
 
International Package:
 
 
 
 
 
 
 
 
 
 
 
   Domestic
$
6.70

 
$
5.69

 
17.8%
 
$
(0.74
)
 
$
5.96

 
4.7%
   Export
28.87

 
28.15

 
2.6%
 
(1.21
)
 
27.66

 
(1.7)%
      Total International Package
$
16.99

 
$
15.47

 
9.8%
 
$
(0.96
)
 
$
16.03

 
3.6%
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
$
10.97

 
$
10.52

 
4.3%
 
$
(0.16
)
 
$
10.81

 
2.8%
*Amounts adjusted for period over period foreign currency exchange rate and hedging differences
 
 
 
 
 
 
 
 
 
 
 
Currency Neutral Revenue
(unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
 
Currency
 
 
 
March 31
 
 
 
Neutral
 
2018
 
2017
 
% Change
 
Currency
 
2018*
 
% Change
 
 
 
 
 
 
 
 
 
 
 
 
Revenue (in millions):
 
 
 
 
 
 
 
 
 
 
 
  U.S. Domestic Package
$
10,227

 
$
9,536

 
7.2%
 
$
—

 
$
10,227

 
7.2%
  International Package
3,533

 
3,074

 
14.9%
 
(193
)
 
3,340

 
8.7%
  Supply Chain & Freight
3,353

 
2,900

 
15.6%
 
(51
)
 
3,302

 
13.9%
  Total revenue
$
17,113

 
$
15,510

 
10.3%
 
$
(244
)
 
$
16,869

 
8.8%
*Amounts adjusted for period over period foreign currency exchange rate and hedging differences
 
 
 
 
 
 
 
 
 
 
 
Currency Neutral Operating Profit
(unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
 
Currency
 
March 31
 
 
 
 
 
Neutral
 
2018
 
2017
 
% Change
 
Currency
 
2018*
 
% Change
 
 
 
 
 
 
 
 
 
 
 
 
Operating Profit (in millions):
 
 
 
 
 
 
 
 
 
 
  U.S. Domestic Package
$
756

 
$
950

 
(20.4)%
 
$
—

 
$
756

 
(20.4)%
  International Package
594

 
518

 
14.7%
 
(22
)
 
572

 
10.4%
  Supply Chain & Freight
170

 
149

 
14.1%
 
(1
)
 
169

 
13.4%
  Total operating profit
$
1,520

 
$
1,617

 
(6.0)%
 
$
(23
)
 
$
1,497

 
(7.4)%
* Amounts adjusted for period over period foreign currency exchange rate and hedging differences

UPS Freight Selected Operating Data - First Quarter
(unaudited)
 
Three Months Ended
 
 
 
March 31
 
 
 
2018
2017
Change
% Change
LTL revenue (in millions)
$
661

$
616

$
45

7.3
 %
LTL revenue per LTL hundredweight
$
24.76

$
23.57

$
1.19

5.0
 %
 
 
 
 
 
LTL shipments (in thousands)
2,468

2,510

(42
)
(1.7
)%
LTL shipments per day (in thousands)
38.6

39.2

(0.6
)
(1.7
)%
 
 
 
 
 
LTL gross weight hauled (in millions of pounds)
2,670

2,613

57

2.2
 %
LTL weight per shipment (in pounds)
1,082

1,041

41

3.9
 %
 
 
 
 
 
Operating weekdays
64

64

—

—
 %



United Parcel Service, Inc.
Detail of Other Operating Expenses - First Quarter
(unaudited)
 
Three Months Ended
 
 
 
 
 
March 31
 
 
 
 
 
2018
 
2017
 
Change
 
% Change
(amounts in millions)
 
 
 
 
 
 
 
Repairs and Maintenance
$
434

 
$
390

 
$
44

 
11.3
%
Depreciation and Amortization
596

 
554

 
42

 
7.6
%
Purchased Transportation
3,145

 
2,545

 
600

 
23.6
%
Fuel
750

 
621

 
129

 
20.8
%
Other Occupancy
361

 
299

 
62

 
20.7
%
Other Expenses
1,262

 
1,173

 
89

 
7.6
%
Total Other Operating Expenses
$
6,548

 
$
5,582

 
$
966

 
17.3
%

Detail of Other Pension Income (Expense) - First Quarter
(unaudited)
 
Three Months Ended
 
 
 
 
 
March 31
 
 
 
 
 
2018
 
2017
 
Change
 
% Change
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Domestic Package
$
227

 
$
139

 
88

 
63.3
%
International Package
20

 
13

 
7

 
53.8
%
Supply Chain & Freight
38

 
28

 
10

 
35.7
%
Total other pension income (expense)
$
285

 
$
180

 
$
105

 
58.3
%

Earnings Per Share and Share Data - First Quarter (unaudited)
 
Three Months Ended
 
March 31
 
2018
 
2017
(amounts in millions, except per share data)
 
 
 
Numerator:
 
 
 
    Net income
$
1,345

 
$
1,166

 
 
 
 
Denominator:
 
 
 
    Weighted-average shares
861

 
869

    Deferred compensation obligations
1

 
1

    Vested portion of restricted units
4

 
4

Denominator for basic earnings per share
866

 
874

 
 
 
 
Effect of dilutive securities:
 
 
 
    Restricted units
4

 
4

    Stock options
—

 
1

Denominator for diluted earnings per share
870

 
879

 
 
 
 
Basic earnings per share
$
1.55

 
$
1.33

 
 
 
 
Diluted earnings per share
$
1.55

 
$
1.33

 
 
 
 
 
 
 
 
Detail of shares outstanding as of March 31, 2018:
 
 
 
 
 
 
 
Class A shares
173

 
 
Class B shares
689

 
 
    Total shares outstanding
862

 
 



United Parcel Service, Inc.
Consolidated Balance Sheets - March 31, 2018 and December 31, 2017
(unaudited)

 
March 31, 2018
 
December 31, 2017
(amounts in millions)
 
 
 
 
 
 
 
ASSETS
 
 
 
Current Assets:
 
 
 
Cash and marketable securities
$
4,209

 
$
4,069

Other current assets
9,411

 
11,649

Total Current Assets
13,620

 
15,718

Property, Plant and Equipment
50,309

 
48,726

Less accumulated depreciation and amortization
27,070

 
26,608

 
23,239

 
22,118

Other Assets
7,605

 
7,738

Total Assets
$
44,464

 
$
45,574

 
 
 
 
 
 
 
 
LIABILITIES AND SHAREOWNERS' EQUITY
 
 
 
Current Liabilities
$
11,149

 
$
12,886

Long-Term Debt
20,409

 
20,278

Pension and Postretirement Benefit Obligations
7,053

 
7,061

Deferred Taxes, Credits and Other Liabilities
4,478

 
4,325

Shareowners' Equity
1,375

 
1,024

Total Liabilities and Shareowners’ Equity
$
44,464

 
$
45,574


Amounts are subject to reclassification.

United Parcel Service, Inc.
Selected Cash Flow Data
(unaudited)
Net Increase in Cash, Cash Equivalents and Restricted Cash
 
 
Preliminary
 
 
Year-to-Date
(amounts in millions)
 
March 31
Cash flows from operating activities
 
$
4,067

Cash flows used in investing activities
 
(1,446
)
Cash flows used in financing activities
 
(2,550
)
 
 
 
Effect of exchange rate changes on cash, cash equivalents and restricted cash
 
(14
)
Net increase in cash, cash equivalents and restricted cash
 
$
57

 
 
 
Reconciliation of Free Cash Flow (non-GAAP)
 
 
Preliminary
 
 
Year-to-Date
(amounts in millions)
 
March 31
Cash flows from operating activities
 
$
4,067

Capital expenditures
 
(1,537
)
Proceeds from disposals of PP&E
 
20

Net change in finance receivables
 
—

Other investing activities
 
2

     Free cash flow (non-GAAP)
 
$
2,552


Amounts are subject to reclassification.




United Parcel Service, Inc.
Aircraft Fleet - as of March 31, 2018
(unaudited)

Description
Owned and Capital Leases
Leases & Charters from Others
On Order
Under Option
Operating:
 
 
 
 
Boeing 757-200
75

—

—

—

Boeing 767-200
—

2

—

—

Boeing 767-300
59

—

4

—

Boeing 767-300BCF
3

—

—

—

Airbus A300-600
52

—

—

—

Boeing MD-11
37

4

—

—

Boeing 747-400F
11

—

—

—

Boeing 747-400BCF
2

—

—

—

Boeing 747-8F
5

—

23

—

Other
—

314

—

—

 
 
 
 
 
          Total
244

320

27

—