Cyberattack costs USD 300 million
The US integrator Fedex reported earnings of USD 2.19 per diluted share (USD 2.51 per diluted share on an adjusted basis) for Q1 ended August 31, compared to USD 2.65 per diluted share (USD 2.82 per diluted share on an adjusted basis) a year ago. Both as-reported and adjusted earnings reflect the estimated negative impact of the 27 June cyberattack affecting TNT Express (USD 0.79 per diluted share) and hurricane Harvey (USD 0.02 per diluted share).
Fedex Express segment's operating results declined by an estimated USD 300 million due to the cyberattack, which was partially offset by the benefits from revenue growth, lower incentive compensation accruals and ongoing cost management initiatives. As-reported results include USD 88 million for integrating TNT Express.
“Q1 posed significant operational challenges due to the TNT Express cyberattack and hurricane Harvey, and I want to thank our team members for their extraordinary dedication and performance,” said Frederick W. Smith, Fedex chairman and CEO.
He added: “We are confident of our prospects for long-term profitable growth, and we reaffirm our commitment to improve the operating income of the Fedex Express segment by USD 1.2 billion to USD 1.5 billion in fiscal 2020 versus fiscal 2017.” (mw)