FedEx profit meets Wall St view

A Federal Express truck goes out on deliveries from a FEDEX station in Los Angeles, 2008. (REUTERS/Fred Prouser)

DETROIT (Reuters) - Package delivery company FedEx Corp <FDX.N> reported quarterly profit in line with estimates, but said earnings had been hurt by challenging global economic conditions and high fuel prices.

FedEx also gave an outlook for the current quarter that was above analysts' expectations and announced a 2009 rate increase for its express delivery unit that will take effect in January.

The Memphis, Tennessee-based company reported a first-quarter fiscal 2009 net profit of $384 million, or $1.23 a share, compared with $494 million, or $1.58 a share, a year earlier.

Wall Street analysts had on average expected earnings per share for the quarter of $1.23, according to Reuters Estimates.

Like its main rival, Atlanta-based United Parcel Service Inc <UPS.N>, FedEx is seen as a bellwether of U.S. economic activity.

FedEx reported fiscal first-quarter revenue of $9.97 billion, up 8 percent from the $9.20 billion a year ago. Analysts had expected revenue of $9.87 billion.

Revenue at its core express delivery unit rose 9 percent to $6.42 billion from $5.89 billion, the company said on Thursday.

For the current quarter, the package delivery company said it expects earnings per share in a range from $1.40 to $1.60. Analysts had expected EPS for the quarter of $1.35.

FedEx reiterated its previous full-year forecast of EPS in a range from $4.75 to $5.25. Analysts have expected full-year EPS of $5.20.

Despite the challenging economic environment, FedEx said it will raise shipping rates at FedEx Express by an average of 6.9 percent for U.S. and U.S. export services. The new rates will come into effect on Jan 5. FedEx said it will announce rate increases for its ground package delivery unit FedEx Ground.

FedEx said that it has cut its capital expenditure plan to $2.6 billion for fiscal 2009.

(Reporting by Nick Carey; Editing by Steve Orlofsky, Dave Zimmerman)