(New York) The American freight transport group UPS on Tuesday lowered its outlook for the year 2023 following the agreement reached at the end of July with the powerful trade union organization the Teamsters, which made it possible to rule out the risk of strike .
They had until July 31 to agree on the next collective agreement (2023-2028), which concerns the 340,000 members of the union. This agreement was still to be put to an employee vote between August 3 and 22.
A strike threatened to have disastrous consequences for the American economy.
This agreement provides in particular for a total increase in the hourly wage of 7.50 dollars over the duration of the agreement, including 2.75 dollars this year.
“Win-win-win. Union agreement reached with the Teamsters,” the group said in a statement Tuesday.
In pre-opening New York Stock Exchange trading, UPS stock fell 6.67% to $170. It ended Monday’s session up 0.67%.
“UPS is stronger than ever. Looking to the future, we will maintain our strategy to capture growth in the most attractive corners of the market and to make our global network even more efficient,” commented Carol Tomé, boss of UPS, quoted in the press release.
The group, which employs more than 500,000 people worldwide, announced that it now expects full-year revenue of around $93 billion, compared to around $97 billion previously, and an adjusted operating margin around 11.8% (12.8% previously).
This “reflects the impact in terms of the volume of labor negotiations and the costs associated” with the agreement reached with the Teamsters.
Its activity has indeed suffered a brake in the second quarter with a decline of 10.9% over one year to 22.05 billion dollars. This is below consensus expectations (23.04 billion).
In the United States, volumes fell by 9.9% on average daily, but an increase in the average price per shipment (3.3%) helped to partially offset this shortfall.
The same trend internationally, where turnover fell by 6.9%, affected by a decline in average daily volumes (-6.6%) and by a “softness that continues in Asia”.
UPS, on the other hand, confirmed its capital expenditure forecast and its dividend and share buyback envelopes.
Net profit was 2.08 billion. Diluted per share – a benchmark for analysts – it comes out at 2.54 dollars when the consensus was for 2.49 dollars and it was 3.29 dollars a year earlier.
