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, February 29, 2008
2007 Adjusted Diluted EPS Reduced to $4.11 On Revisions to Tax Calculation
On Jan. 30, 2008, UPS (NYSE: UPS) reported an 8% increase in adjusted diluted earnings per share to $4.17 for the full year of 2007. Following the release of this information, in completing the company's financial statements for 2007, UPS identified a state income tax benefit of $65 million that was incorrectly recorded in the fourth quarter.
The tax benefit was related to UPS's withdrawal from the Central States multi-employer pension plan. This error was discovered by the company during its regular internal review process prior to the filing of its Form 10-K for 2007. Correcting this error has reduced adjusted diluted earnings per share to $4.11 for the full year, a 6.5% increase over the prior year.
The correction has no impact on revenue, operating profit (loss), income (loss) before taxes or segment results for the fourth quarter or the full year of 2007, nor does it impact cash flow or liquidity.
For the 4th quarter, UPS originally reported adjusted diluted earnings per share of $1.13. The revised adjusted diluted earnings per share are $1.07.
On an unadjusted basis, UPS previously reported a loss per diluted share of $2.46 for the quarter and a diluted profit per share of $0.42 for the full year. Those figures now are a loss of $2.52 per share and a profit of $0.36, respectively.
UPS's previous estimates for 2008 earnings per share remain unchanged at $0.94-to-$0.98 for the first quarter and $4.30-to-$4.50 for the full year, as does the company's estimated effective tax rate for 2008 of approximately 36%.
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