Annual report pursuant to Section 13 and 15(d)

SEGMENT AND GEOGRAPHIC INFORMATION

v2.4.0.6
SEGMENT AND GEOGRAPHIC INFORMATION
 12 Months Ended
Dec. 31, 2011
SEGMENT AND GEOGRAPHIC INFORMATION

NOTE 12. SEGMENT AND GEOGRAPHIC INFORMATION

We report our operations in three segments: U.S. Domestic Package operations, International Package operations and Supply Chain & Freight operations. Package operations represent our most significant business and are broken down into regional operations around the world. Regional operations managers are responsible for both domestic and export operations within their geographic area.

U.S. Domestic Package

Domestic Package operations include the time-definite delivery of letters, documents and packages throughout the United States.

International Package

International Package operations include delivery to more than 220 countries and territories worldwide, including shipments wholly outside the United States, as well as shipments with either origin or destination outside the United States. Our International Package reporting segment includes the operations of our Europe, Asia and Americas operating segments.

Supply Chain & Freight

Supply Chain & Freight includes our forwarding and logistics operations, UPS Freight and other aggregated business units. Our forwarding and logistics business provides services in more than 195 countries and territories worldwide, and includes supply chain design and management, freight distribution, customs brokerage, mail and consulting services. UPS Freight offers a variety of LTL and TL services to customers in North America. Other aggregated business units within this segment include Mail Boxes Etc. (the franchisor of Mail Boxes Etc. and The UPS Store) and UPS Capital.

In evaluating financial performance, we focus on operating profit as a segment’s measure of profit or loss. Operating profit is before investment income, interest expense and income taxes. The accounting policies of the reportable segments are the same as those described in the summary of accounting policies (see Note 1), with certain expenses allocated between the segments using activity-based costing methods. Unallocated assets are comprised primarily of cash, marketable securities, and certain investment partnerships.

 

Segment information as of, and for the years ended, December 31 is as follows (in millions):

 

     2011      2010      2009  

Revenue:

         

U.S. Domestic Package

    $ 31,717       $ 29,742       $ 28,158   

International Package

      12,249         11,133         9,699   

Supply Chain & Freight

      9,139         8,670         7,440   
  

 

 

     

 

 

     

 

 

  

Consolidated

    $ 53,105       $ 49,545       $ 45,297   
  

 

 

     

 

 

     

 

 

  

Operating Profit:

         

U.S. Domestic Package

    $ 3,764       $ 3,238       $ 1,919   

International Package

      1,709         1,831         1,279   

Supply Chain & Freight

      607         572         310   
  

 

 

     

 

 

     

 

 

  

Consolidated

    $ 6,080       $ 5,641       $ 3,508   
  

 

 

     

 

 

     

 

 

  

Assets:

         

U.S. Domestic Package

    $ 19,300       $ 18,425       $ 18,572   

International Package

      6,729         6,228         5,882   

Supply Chain & Freight

      6,588         6,283         6,620   

Unallocated

      2,084         2,661         809   
  

 

 

     

 

 

     

 

 

  

Consolidated

    $ 34,701       $ 33,597       $ 31,883   
  

 

 

     

 

 

     

 

 

  

Depreciation and Amortization Expense:

         

U.S. Domestic Package

    $ 1,154       $ 1,174       $ 1,064   

International Package

      474         443         500   

Supply Chain & Freight

      154         175         183   
  

 

 

     

 

 

     

 

 

  

Consolidated

    $ 1,782       $ 1,792       $ 1,747   
  

 

 

     

 

 

     

 

 

  

Revenue by product type for the years ended December 31 is as follows (in millions):

 

     2011      2010      2009  

U.S. Domestic Package:

         

Next Day Air

    $ 6,229       $ 5,835       $ 5,456   

Deferred

      3,299         2,975         2,859   

Ground

      22,189         20,932         19,843   
  

 

 

     

 

 

     

 

 

  

Total U.S. Domestic Package

      31,717         29,742         28,158   

International Package:

         

Domestic

      2,628         2,365         2,111   

Export

      9,056         8,234         7,176   

Cargo

      565         534         412   
  

 

 

     

 

 

     

 

 

  

Total International Package

      12,249         11,133         9,699   

Supply Chain & Freight:

         

Forwarding and Logistics

      6,103         6,022         5,080   

Freight

      2,563         2,208         1,943   

Other

      473         440         417   
  

 

 

     

 

 

     

 

 

  

Total Supply Chain & Freight

      9,139         8,670         7,440   
  

 

 

     

 

 

     

 

 

  

Consolidated

    $ 53,105       $ 49,545       $ 45,297   
  

 

 

     

 

 

     

 

 

  

 

Geographic information as of, and for the years ended, December 31 is as follows (in millions):

 

     2011      2010      2009  

United States:

         

Revenue

    $ 39,347       $ 36,795       $ 34,375   

Long-lived assets

    $ 16,085       $ 16,693       $ 17,336   

International:

         

Revenue

    $ 13,758       $ 12,750       $ 10,922   

Long-lived assets

    $ 5,220       $ 5,047       $ 4,935   

Consolidated:

         

Revenue

    $ 53,105       $ 49,545       $ 45,297   

Long-lived assets

    $ 21,305       $ 21,740       $ 22,271   

Long-lived assets include property, plant and equipment, pension and postretirement benefit assets, long-term investments, goodwill, and intangible assets.

No countries outside of the United States, nor any individual customers, provided 10% or more of consolidated revenue in 2011, 2010 or 2009.