UPS - UPS Earnings Show The Weight Of $170000 Salaries While It Learns To Navigate Shipping Slump | Benzinga
A substantial slowdown in the shipping business has caused United Parcel Service, Inc. (NYSE:UPS) to deliver lackluster first-quarter results on Tuesday.
When compared to the same period last year, revenue declined 5.3% and operating profit was down 31.5% when adjusting for inflation.
The large drop in operating profit stems from recent salary negotiations between UPS and the Teamsters, the labor union that represents the company's employees.
The historic wage negotiation closed last August and hit the UPS balance sheet by guaranteeing a $170,000 salary for delivery truck drivers over the next five years. Negotiations affect 340,000 UPS teamsters with higher wages and overall better working conditions, making the $170k salary the new average for UPS employees.
Nonetheless, shares of the company were up by 2.4% as Tuesday progressed, as quarterly profit beat analyst expectations, although they were ...