VOL. 128 | NO. 108 | Tuesday, June 4, 2013
FedEx Takes $100 Million Charge for Aircraft Retirement
MEMPHIS (AP) – FedEx Corp. said Monday that it recently took a $100 million charge for retiring some of its aircraft and said it will take $74 million in additional charges in its next fiscal year because it is speeding up retirement of other planes.
FedEx retired 10 aircraft and 21 engines. It is accelerating the retirement of 76 other aircraft and 287 engines by several years, although it did not specify when those aircraft will go out of service. The acceleration of those retirements will add $74 million to the company's planned depreciation expenses. FedEx is phasing out older aircraft that are less fuel-efficient and reliable.
The company took a $100 million impairment charge in May as it retired five MD10-10 aircraft, three A310-300s, and two A310-200s. FedEx is speeding up the retirements of 47 MD 10-10s, 13 MD 10-30s, and 16 A310-200s.
FedEx said it had 660 planes in its fleet as of Feb. 28, including 368 jets.
The company also raised its quarterly dividend to 15 cents per share from 14 cents. The next dividend is payable July 1 to shareholders of record as of June 17.
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