(Reuters) -FedEx on Tuesday reported a fall in quarterly adjusted profit after a drop in e-commerce delivery demand offset its $4 billion cost-cutting plan aimed at sheltering margins.
Shares of the company were down about 2.8% after the bell, when FedEx also announced that Michael Lenz would retire as chief financial officer effective July 31 but remain as a senior adviser to the company until Dec 31.
The deflating e-commerce delivery bubble, recession risks and pressure from an activist investor pushed Tennessee-based FedEx to begin slashing fixed costs in a bid to protect margins.
In the last year, FedEx has shuttered offices, cut jobs, reduced its fleet of cargo planes and canceled profit-sapping Sunday deliveries in far-flung areas to remain competitive in an unpredictable economy.
While the global shipping downturn has been a margin drag for most operators in the sector, FedEx also faces a balancing act of matching costs and capacity with waning demand.
The company posted an adjusted profit of $4.94 per share for the fourth quarter ended May 31, compared with $6.87 per share a year earlier.
Results from the latest quarter included a noncash impairment charge of $70 million, or 21 cents per diluted share, due to the permanent retirement of 18 aircraft and 34 related engines.
(Reporting by Priyamvada C in BengaluruEditing by Devika Syamnath and Matthew Lewis)
