Decisive actions on many fronts during FY15 are transforming FedEx, positioning the company to deliver long-term shareowner value in FY16 and beyond.
Frederick W. Smith
Chairman, President and CEO
To Our Shareowners,
FY15 was a transformative year for FedEx with outstanding financial results, more powerful customer solutions, and actions to generate increased long-term value for shareowners. Record adjusted earnings1 were driven by higher volumes and improved base yields from each transportation segment. Here are a few of the FedEx team’s major accomplishments this past fiscal year:
We believe the TNT Express, GENCO and Bongo acquisitions we announced may prove as important to FedEx as the additions of Flying Tigers in 1989 and Caliber System in 1998, which respectively gave our customers access to global markets and the economical option of convenient ground delivery service. All three companies provide best-in-class capabilities that will fill critical gaps in our portfolio of customer solutions and boost our long-term competitive advantage. The TNT Express transaction is expected to be completed in the first half of calendar 2016.
We’re on target to achieve the goal of the FedEx Express profit improvement plan we outlined in FY13 — to exit 2016 with a run rate of $1.6 billion in additional operating profit from the then FY13 base results.
In FY15, in light of increasing e-commerce low-density shipments, we took action to ensure we’re more adequately compensated for the high-quality services we provide customers. At FedEx Ground, dimensional weight pricing was extended to all shipments. Fuel surcharge rates were adjusted at all transportation companies to reduce volatility and — for the first time — our 2015 rate increase announcement combined express, ground and freight details, giving our customers a more holistic view of our transportation solutions and additional time to plan their annual budgets.
Our team members around the world executed our strategies very effectively. They again came through for our customers, especially during another record-breaking peak season. Continue reading
Our retail network connects customers to convenience.
Customers tell us they want convenience and flexibility, and that’s our goal. We continually enhance our retail convenience network to make it easier to pack, ship and pick up packages, especially e-commerce shipments that are helping power our growth.
New aircraft boost efficiency and flexibility.
Modernizing the FedEx Express air fleet is improving margins and adding flexibility to our domestic and international operations. We added 17 new Boeing 767-300 Freighters in FY15 and plan to add 11 more in FY16.
Acquisitions change what’s possible for customers.
Three acquisitions announced in FY15 — GENCO, Bongo and TNT Express — will fill critical gaps in our portfolio of customer solutions.
Supplies bring urgent relief to Nepal.
The Nepal earthquake in April claimed more than 8,000 lives, injured thousands more, devastated a half million homes and obliterated many irreplaceable historic buildings. It also ripped apart the fabric of everyday life, destroying roads, schools, stores and hospitals.
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Purple Promise Chairman’s Award Winner
Linda DiLeo
Specialty Customer Representative, FedEx TechConnect, Fort Lauderdale, Florida, USA
When she received the call, Linda DiLeo knew a life was at stake. A German medical device manufacturer had just shipped a custom-made skull implant to Detroit, Michigan, for a life-saving operation. Just one problem: The company shipped the package on Friday — a day when FedEx didn’t operate flights from Germany — and the surgery was scheduled for Monday. Linda took it upon herself to coordinate a FedEx team, place the package on a flight, and arrange pre-clearance through customs and pickup from the Detroit ramp. The patient’s surgery proceeded on schedule and a life was saved.“If you put your heart into everything you do, you can always make a difference in people’s lives,” says DiLeo.
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Purple Promise Chairman’s Award Winner
Francisco Sandoval
Sort Manager, FedEx Ground, Saginaw, Michigan, USA
It was the day before Mother’s Day when the Saginaw, Michigan, FedEx Ground station received 38 packages of flowers and a problem. The flowers were not scheduled to be delivered until the day after Mother’s Day. The station’s sort manager, Francisco Sandoval was determined to get the flowers there on time. Even though the recipients lived outside the service area, and despite the heavy volumes, Sandoval found a FedEx Ground driver to deliver the flowers Saturday, even though the area wasn’t on his schedule. The result: Mother’s Day arrived a day early.“Whether it’s Mother’s Day or a typical Saturday, I do everything I can to make our customers happy,” Sandoval says.
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Purple Promise Chairman’s Award Winner
Qing-Hua Wen
Senior Service Representative, FedEx Express, Shenzhen, China
Carpentry isn’t a job requirement for FedEx Express senior service representative Qing-Hua Wen, but it sure came in handy. While completing his daily route in Shenzhen, China, Qing-Hua received an urgent pickup request. A valuable shipment had been refused by other courier companies because it was too fragile. He quickly determined that a wooden box would provide the best protection, but one wasn’t available. So Qing-Hua took his customer and the shipment to a carpenter’s shop, negotiated with the shop owner and built the box himself. The result: The crystal sculpture was safely delivered and FedEx had a loyal new customer.“My job is to deliver the Purple Promise by thinking for my customers and solving their problems,” says Qing-Hua.
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Purple Promise Chairman’s Award Winner
Chris Cox
City Driver, FedEx Freight, Sheboygan, Wisconsin, USA
Chris Cox had a challenge that required some innovative thinking. He was assigned to pick up a large shipment of printed graphics destined for delivery to home improvement stores nationwide. With more than 1,600 pallets of priority freight to be picked up, Cox proposed a loading method to improve efficiency and reduce handling throughout the many FedEx Freight hubs through which the shipment would transit. By taking ownership of the rollout, Cox met his customer’s requirements and saved FedEx money. The result: early delivery, no damage returns and a better way to do business.“I wanted to do this to the best of my ability and make it an outstanding experience for the dock workers and our customer,” Cox says.
