UPS’s supply chain and freight divisions have reported record profits in 2010.

The company also raised its earnings outlook for 2011, predicting record profits – double those achieved two years ago.

The operator’s supply chain and freight divisions achieved “record-setting” profit levels of US$1.9 billion and $577 million, respectively.

In the fourth quarter of 2010, the combined divisions’ adjusted operating profit improved more than six-fold to $176 million, on revenue growth of 13%.

Adding-in its domestic and international package divisions, UPS saw global revenue increase 9.4% to $49.5 billion for the year, while operating profit jumped 55% to $5.9 billion.

The integrator said: “UPS Freight outpaced the market, with revenue up 23%, due to double-digit growth in shipments per day, an increase in gross weight hauled and significant yield improvement.

“Forwarding and logistics revenue increased 10.1% to $1.6 billion, driven primarily by revenue management initiatives in the forwarding business unit.”

UPS Chief Financial Officer Kurt Kuehn was positive about prospects for the coming 12 months.

He said: “Over the past two years, UPS took the necessary steps to weather the economic storm, and emerged stronger.

“As a result, we expect to exceed previous peak earnings levels, with 2011 diluted earnings per share within a range of $4.12 to $4.35, an increase of 16-22% over adjusted 2010 results.

“Cash flow will continue to be strong, creating a foundation for increasing returns to shareholders,” Kuehn added. “We plan to significantly ramp-up share repurchases, to approximately $2 billion in 2011.”

Source: ifw