FedEx (FDX) 8-K FedEx Corp. Reports Second Quarter Earnings

Exhibit 99.1

FOR IMMEDIATE RELEASE

FedEx Corp. Reports Second Quarter Earnings

MEMPHIS, Tenn., December 19, 2012 … FedEx Corp. (NYSE: FDX) today reported earnings of $1.39 per diluted share for the second quarter ended November 30, compared to $1.57 per share last year. Superstorm Sandy impacted the quarter’s results by $0.11 per diluted share due to reduced shipment volumes and incremental operating costs.

“Operating income for the quarter improved at FedEx Freight and FedEx Ground due to increased volumes and higher yields, while persistent weakness in the global economy and increased demand for lower-yielding international services limited profits at FedEx Express,” said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer. “Earnings also were negatively impacted by disruptions caused by Superstorm Sandy. We are hard at work on another record-setting holiday shipping season, driven by the continued growth of e-commerce. I would like to thank all of our team members for their hard work and dedication during our peak season.”

Second Quarter Results

FedEx Corp. reported the following consolidated results for the second quarter:

• Revenue of $11.1 billion, up 5% from $10.6 billion the previous year

• Operating income of $718 million, down 8% from $780 million last year

• Operating margin of 6.5%, down from 7.4% the previous year

• Net income of $438 million, down 12% from last year’s $497 million

The results of the quarter also reflect, primarily at FedEx Express, the net year-over-year negative impact from the timing lag that exists between when fuel prices change and indexed fuel surcharges automatically adjust.

Outlook

FedEx projects earnings to be $1.25 to $1.45 per diluted share in the third quarter and reaffirms its forecast of $6.20 to $6.60 per diluted share for fiscal

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2013 before charges related to the company’s previously announced voluntary buyout program. Costs of the benefits provided under the voluntary program are expected to be recognized in the fourth fiscal quarter. The company expects the pretax cost of the voluntary buyout program to range from approximately $550 to $650 million, or $1.09 to $1.29 per diluted share, but actual costs will depend on employee acceptance rates. This guidance assumes the current market outlook for fuel prices. The company reported earnings of $1.65 per diluted share in last year’s third quarter, which included a $0.10 per share reversal of a reserve associated with a legal matter at FedEx Express. The capital spending forecast for fiscal 2013 remains $3.9 billion.

“We are steadfastly committed to the $1.7 billion of annual profit improvement actions, primarily at FedEx Express, which we announced in October,” said Alan B. Graf, Jr., FedEx Corp. executive vice president and chief financial officer. “We expect to begin to see the benefits of these actions in fiscal 2014, with a significant portion of the profit improvement achieved by the end of fiscal 2015. Meanwhile, the mounting uncertainty in the U.S. related to fiscal policies and their potential to impact earnings by further restraining economic growth is a concern.”

FedEx Express Segment

For the second quarter, the FedEx Express segment reported:

• Revenue of $6.86 billion, up 4% from last year’s $6.58 billion

• Operating income of $230 million, down 33% from $342 million a year ago

• Operating margin of 3.4%, down from 5.2% the previous year

Revenue increased primarily due to this year’s business acquisitions and growth at FedEx Trade Networks, as core express revenue growth was constrained by global economic conditions and the impact of Superstorm Sandy.

U.S. domestic revenue per package grew 1% as higher rate per pound was partially offset by lower fuel surcharges. U.S. domestic average daily package volume declined 2%. FedEx international export average daily package volume grew 6% driven by increases in FedEx International Economy^® (IE) from Europe and Asia and by increases in FedEx International Priority^® (IP) from Asia. Higher growth in international deferred services continued, with IE volume growing 14%, while IP volume increased 3% during the quarter. International export revenue per package fell 4% due to the demand shift toward lower-yielding international services and lower fuel surcharges.

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Operating income and margin were lower due to the demand shift toward lower-yielding international services, the negative year-over-year impact of net fuel changes, increased depreciation expense, the effects of Superstorm Sandy and higher pension costs. These were partially offset by the favorable impact of cost containment actions.

FedEx Express has entered into an agreement to purchase four additional 767-300 freighters as part of the company’s continued fleet modernization efforts. This brings the total 767-300 orders to 50, with deliveries beginning in fiscal 2014. In concert with this commitment, two 777 freighter deliveries were deferred from fiscal 2015 to fiscal 2016 in order to better match capacity timing to global demand.

FedEx Ground Segment

For the second quarter, the FedEx Ground segment reported:

• Revenue of $2.59 billion, up 11% from last year’s $2.34 billion

• Operating income of $412 million, up 4% from $398 million a year ago

• Operating margin of 15.9%, down from 17.0% the previous year

FedEx Ground average daily volume grew 8% in the second quarter driven by increases in both FedEx Home Delivery and business-to-business services. Revenue per package increased 2% due to increased rates and higher extra service revenue. FedEx SmartPost average daily volume increased 17% primarily due to growth in e-commerce. FedEx SmartPost net revenue per package increased 2% due to a change in service mix and to rate increases, partially offset by higher postage rates.

Operating income increased due to higher volume and revenue per package, partially offset by higher contractor rates, increased network expansion costs and the effects of Superstorm Sandy. Operating margin decreased primarily due to lower fuel surcharges paired with higher purchased transportation expenses related to increased fuel costs.

FedEx Freight Segment

For the second quarter, the FedEx Freight segment reported:

• Revenue of $1.38 billion, up 4% from last year’s $1.33 billion

• Operating income of $76 million, up 90% from $40 million a year ago

• Operating margin of 5.5%, up from 3.0% the previous year

Less-than-truckload (LTL) yield increased 2% due to FedEx Freight Economy base yield improvement. LTL average daily shipments increased 2% due to higher customer demand for the FedEx Freight Economy service offering in all lengths of haul.

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Operating income and margin increased primarily due to higher yield, volume growth and operational efficiencies within the company’s integrated network.

Corporate Overview

FedEx Corp. (NYSE: FDX) provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services. With annual revenues of $43 billion, the company offers integrated business applications through operating companies competing collectively and managed collaboratively, under the respected FedEx brand. Consistently ranked among the world’s most admired and trusted employers, FedEx inspires its more than 300,000 team members to remain “absolutely, positively” focused on safety, the highest ethical and professional standards and the needs of their customers and communities. For more information, visitnews.fedex.com.

Additional information and operating data are contained in the company’s annual report, Form 10-K, Form 10-Qs and second quarter fiscal 2013 Statistical Book. These materials, as well as a webcast of the earnings release conference call to be held at 8:30 a.m. EST on December 19 are available on the company’s website atinvestors.fedex.com. A replay of the conference call webcast will be posted on our website following the call.

Certain statements in this press release may be considered forward-looking statements, such as statements relating to management’s views with respect to future events and financial performance. Such forward-looking statements are subject to risks, uncertainties and other factors which could cause actual results to differ materially from historical experience or from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, economic conditions in the global markets in which we operate, legal challenges or changes related to FedEx Ground’s owner-operators, new U.S. domestic or international government regulation, the impact from any terrorist activities or international conflicts, our ability to effectively operate, integrate and leverage acquired businesses, changes in fuel prices and currency exchange rates, our ability to match capacity to shifting volume levels and other factors which can be found in FedEx Corp.’s and its subsidiaries’ press releases and filings with the SEC.

Media Contact: Jess Bunn 901-818-7463

Investor Contact: Mickey Foster 901-818-7468

Home Page: fedex.com

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RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

TO GAAP FINANCIAL MEASURES

The company believes that meaningful analysis of our expected financial performance requires an understanding of the factors underlying that expected performance and our judgments about the likelihood that particular factors will repeat. Excluding the costs associated with the company’s voluntary cash buyouts will allow for more accurate comparisons of our expected operating performance. As required by SEC rules, the table below presents a reconciliation of our presented non-GAAP measure to the most directly comparable GAAP measure.

	FY 2013 Diluted EPS Guidance
Non-GAAP Measure	$	6.20 to $6.60
Voluntary Buyout Program		1.29 to   1.09
GAAP Measure	$	4.91 to $5.51

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FEDEX CORP. FINANCIAL HIGHLIGHTS

Second Quarter Fiscal 2013

(In millions, except earnings per share)

(Unaudited)

	Three Months Ended									Six Months Ended
	November 30									November 30
	2012			2011			%			2012			2011			%
Revenue:
FedEx Express segment	$	6,858		$	6,583			4	%	$	13,490		$	13,175			2	%
FedEx Ground segment		2,593			2,339			11	%		5,055			4,617			9	%
FedEx Freight segment		1,377			1,325			4	%		2,776			2,653			5	%
FedEx Services segment		405			427			(5	%)		794			838			(5	%)
Other & eliminations		(126	)		(87	)		NM			(216	)		(175	)		NM
Total Revenue		11,107			10,587			5	%		21,899			21,108			4	%
Operating Expenses:
Salaries and employee benefits		4,133			3,982			4	%		8,236			7,986			3	%
Purchased transportation		1,860			1,576			18	%		3,540			3,094			14	%
Rentals and landing fees		630			623			1	%		1,248			1,243			—
Depreciation and amortization		592			518			14	%		1,165			1,027			13	%
Fuel		1,235			1,200			3	%		2,373			2,444			(3	%)
Maintenance and repairs		511			511			—			1,053			1,062			(1	%)
Other		1,428			1,397			2	%		2,824			2,735			3	%
Total Operating Expenses		10,389			9,807			6	%		20,439			19,591			4	%
Operating Income:
FedEx Express segment		230			342			(33	%)		437			630			(31	%)
FedEx Ground segment		412			398			4	%		857			805			6	%
FedEx Freight segment		76			40			90	%		166			82			NM
Total Operating Income		718			780			(8	%)		1,460			1,517			(4	%)
Other Expense:
Interest, net		(18	)		(7	)		NM			(28	)		(18	)		NM
Other, net		(8	)		4			NM			(13	)		2			NM
Total Other Expense		(26	)		(3	)		NM			(41	)		(16	)		NM
Pretax Income		692			777			(11	%)		1,419			1,501			(5	%)
Provision for Income Taxes		254			280			(9	%)		522			540			(3	%)
Net Income	$	438		$	497			(12	%)	$	897		$	961			(7	%)
Diluted Earnings Per Share	$	1.39		$	1.57			(11	%)	$	2.84		$	3.02			(6	%)
Weighted Average Common and Common Equivalent Shares		315			316			—			316			317			—
Capital Expenditures	$	916		$	1,107			(17	%)	$	1,888		$	2,217			(15	%)

FEDEX CORP. CONDENSED CONSOLIDATED BALANCE SHEETS

Second Quarter Fiscal 2013

(In millions)

	Nov. 30, 2012
	(Unaudited)			May 31, 2012
ASSETS
Current Assets
Cash and cash equivalents	$	2,517		$	2,843
Receivables, less allowances		5,202			4,704
Spare parts, supplies and fuel, less allowances		456			440
Deferred income taxes		510			533
Prepaid expenses and other		474			536
Total current assets		9,159			9,056
Property and Equipment, at Cost		37,749			36,164
Less accumulated depreciation and amortization		19,400			18,916
Net property and equipment		18,349			17,248
Other Long-Term Assets
Goodwill		2,757			2,387
Other assets		1,047			1,212
Total other long-term assets		3,804			3,599
	$	31,312		$	29,903
LIABILITIES AND STOCKHOLDERS’ INVESTMENT
Current Liabilities
Current portion of long-term debt	$	1		$	417
Accrued salaries and employee benefits		1,297			1,635
Accounts payable		1,730			1,613
Accrued expenses		1,800			1,709
Total current liabilities		4,828			5,374
Long-Term Debt, Less Current Portion		2,241			1,250
Other Long-Term Liabilities
Deferred income taxes		973			836
Pension, postretirement healthcare and other benefit obligations		5,447			5,582
Self-insurance accruals		985			963
Deferred lease obligations		910			784
Deferred gains, principally related to aircraft transactions		239			251
Other liabilities		146			136
Total other long-term liabilities		8,700			8,552
Commitments and Contingencies
Common Stockholders’ Investment
Common stock, $0.10 par value, 800 million shares authorized		32			32
Additional paid-in capital		2,635			2,595
Retained earnings		17,899			17,134
Accumulated other comprehensive loss		(4,770	)		(4,953	)
Treasury stock, at cost		(253	)		(81	)
Total common stockholders’ investment		15,543			14,727
	$	31,312		$	29,903

FEDEX CORP. CONDENSED CONSOLIDATED

STATEMENTS OF CASH FLOWS

Second Quarter Fiscal 2013

(In millions)

(Unaudited)

	Six Months Ended
	November 30
	2012			2011
Operating Activities:
Net income	$	897		$	961
Noncash charges:
Depreciation and amortization		1,165			1,027
Other, net		424			422
Changes in operating assets and liabilities, net		(768	)		(242	)
Net cash provided by operating activities		1,718			2,168
Investing Activities:
Capital expenditures		(1,888	)		(2,217	)
Business acquisitions, net of cash acquired		(483	)		(114	)
Proceeds from asset dispositions and other		20			15
Net cash used in investing activities		(2,351	)		(2,316	)
Financing Activities:
Principal payments on debt		(417	)		(18	)
Proceeds from debt issuance		991			—
Dividends paid		(88	)		(82	)
Purchase of treasury stock		(246	)		(197	)
Other, net		50			37
Net cash provided by (used in) financing activities		290			(260	)
Effect of exchange rate changes on cash		17			(24	)
Net decrease in cash and cash equivalents		(326	)		(432	)
Cash and cash equivalents at beginning of period		2,843			2,328
Cash and cash equivalents at end of period	$	2,517		$	1,896

FEDEX EXPRESS SEGMENT FINANCIAL HIGHLIGHTS

Second Quarter Fiscal 2013

(Dollars in millions)

(Unaudited)

	Three Months Ended									Six Months Ended
	November 30									November 30
	2012			2011			%			2012			2011			%
Revenues:
Package Revenue:
U.S. Overnight Box	$	1,609		$	1,623			(1	%)	$	3,213		$	3,263			(2	%)
U.S. Overnight Envelope		409			421			(3	%)		839			872			(4	%)
Total U.S. Overnight		2,018			2,044			(1	%)		4,052			4,135			(2	%)
U.S. Deferred		732			731			—			1,434			1,462			(2	%)
Total U.S. Package Revenue		2,750			2,775			(1	%)		5,486			5,597			(2	%)
International Priority		1,678			1,711			(2	%)		3,339			3,468			(4	%)
International Economy		514			460			12	%		1,001			901			11	%
Total International Export Package		2,192			2,171			1	%		4,340			4,369			(1	%)
International Domestic1		384			217			77	%		693			424			63	%
Total Package Revenue		5,326			5,163			3	%		10,519			10,390			1	%
Freight Revenue:
U.S.		645			628			3	%		1,255			1,219			3	%
International Priority		446			470			(5	%)		885			919			(4	%)
International Airfreight		77			74			4	%		151			151			—
Total Freight Revenue		1,168			1,172			—			2,291			2,289			—
Other Revenue		364			248			47	%		680			496			37	%
Total Express Revenue	$	6,858		$	6,583			4	%	$	13,490		$	13,175			2	%
Operating Expenses:
Salaries and employee benefits		2,488			2,377			5	%		4,961			4,790			4	%
Purchased transportation		608			448			36	%		1,145			897			28	%
Rentals and landing fees		418			421			(1	%)		833			844			(1	%)
Depreciation and amortization		336			288			17	%		659			570			16	%
Fuel		1,074			1,039			3	%		2,060			2,116			(3	%)
Maintenance and repairs		349			354			(1	%)		721			734			(2	%)
Intercompany charges		535			548			(2	%)		1,072			1,096			(2	%)
Other		820			766			7	%		1,602			1,498			7	%
Total Operating Expenses		6,628			6,241			6	%		13,053			12,545			4	%
Operating Income	$	230		$	342			(33	%)	$	437		$	630			(31	%)
Operating Margin		3.4	%		5.2	%		(1.8	pts)		3.2	%		4.8	%		(1.6	pts)

1 - International Domestic includes international intra-country express operations, including recent acquisitions in Mexico (July 2011), Poland (June 2012), France (July 2012) and Brazil (July 2012).

FEDEX EXPRESS SEGMENT OPERATING HIGHLIGHTS

Second Quarter Fiscal 2013

(Unaudited)

	Three Months Ended							Six Months Ended
	November 30							November 30
	2012		2011		%			2012		2011		%
PACKAGE STATISTICS
Average Daily Package Volume (000s):
U.S. Overnight Box		1,141		1,168		(2	%)		1,116		1,151		(3	%)
U.S. Overnight Envelope		564		582		(3	%)		570		589		(3	%)
Total U.S. Overnight Package		1,705		1,750		(3	%)		1,686		1,740		(3	%)
U.S. Deferred		828		838		(1	%)		794		834		(5	%)
Total U.S. Domestic Package		2,533		2,588		(2	%)		2,480		2,574		(4	%)
International Priority		445		431		3	%		426		424		—
International Economy		157		138		14	%		150		132		14	%
Total International Export Package		602		569		6	%		576		556		4	%
International Domestic1		884		529		67	%		781		486		61	%
Total Average Daily Packages		4,019		3,686		9	%		3,837		3,616		6	%
Yield (Revenue Per Package):
U.S. Overnight Box	$	22.39	$	22.05		2	%	$	22.49	$	22.15		2	%
U.S. Overnight Envelope		11.51		11.48		—			11.51		11.56		—
U.S. Overnight Composite		18.79		18.54		1	%		18.78		18.57		1	%
U.S. Deferred		14.04		13.84		1	%		14.10		13.70		3	%
U.S. Domestic Composite		17.24		17.01		1	%		17.28		16.99		2	%
International Priority		59.91		62.98		(5	%)		61.26		63.90		(4	%)
International Economy		51.97		52.99		(2	%)		52.07		53.43		(3	%)
Total International Export Composite		57.84		60.56		(4	%)		58.86		61.42		(4	%)
International Domestic1		6.88		6.51		6	%		6.93		6.81		2	%
Composite Package Yield	$	21.04	$	22.23		(5	%)	$	21.42	$	22.45		(5	%)
FREIGHT STATISTICS
Average Daily Freight Pounds (000s):
U.S.		7,719		7,630		1	%		7,393		7,295		1	%
International Priority		3,212		3,451		(7	%)		3,197		3,289		(3	%)
International Airfreight		1,166		1,213		(4	%)		1,135		1,188		(4	%)
Total Avg Daily Freight Pounds		12,097		12,294		(2	%)		11,725		11,772		—
Revenue Per Freight Pound:
U.S.	$	1.32	$	1.31		1	%	$	1.33	$	1.31		2	%
International Priority		2.21		2.16		2	%		2.16		2.18		(1	%)
International Airfreight		1.05		0.97		8	%		1.04		0.99		5	%
Composite Freight Yield	$	1.53	$	1.51		1	%	$	1.53	$	1.52		1	%
Operating Weekdays		63		63		—			128		128		—

1 - International Domestic includes international intra-country express operations, including recent acquisitions in Mexico (July 2011), Poland (June 2012), France (July 2012) and Brazil (July 2012).

FEDEX GROUND SEGMENT FINANCIAL AND OPERATING HIGHLIGHTS

Second Quarter Fiscal 2013

(Dollars in millions)

(Unaudited)

	Three Months Ended									Six Months Ended
	November 30									November 30
	2012			2011			%			2012			2011			%
FINANCIAL HIGHLIGHTS
Revenues:
FedEx Ground	$	2,359		$	2,143			10	%	$	4,632		$	4,259			9	%
FedEx SmartPost		234			196			19	%		423			358			18	%
Total Revenues		2,593			2,339			11	%		5,055			4,617			9	%
Operating Expenses:
Salaries and employee benefits		396			362			9	%		773			713			8	%
Purchased transportation		1,057			933			13	%		2,003			1,819			10	%
Rentals		85			72			18	%		159			138			15	%
Depreciation and amortization		110			94			17	%		213			187			14	%
Fuel		4			5			(20	%)		7			7			—
Maintenance and repairs		46			43			7	%		92			87			6	%
Intercompany charges		262			245			7	%		524			486			8	%
Other		221			187			18	%		427			375			14	%
Total Operating Expenses		2,181			1,941			12	%		4,198			3,812			10	%
Operating Income	$	412		$	398			4	%	$	857		$	805			6	%
Operating Margin		15.9	%		17.0	%		(1.1	pts)		17.0	%		17.4	%		(0.4	pts)
OPERATING STATISTICS
Operating Weekdays		63			63			—			128			128			—
Average Daily Package Volume (000s)
FedEx Ground		4,283			3,979			8	%		4,087			3,849			6	%
FedEx SmartPost		2,038			1,737			17	%		1,848			1,573			17	%
Yield (Revenue Per Package)
FedEx Ground	$	8.72		$	8.53			2	%	$	8.83		$	8.62			2	%
FedEx SmartPost	$	1.82		$	1.79			2	%	$	1.79		$	1.78			1	%

FEDEX FREIGHT SEGMENT FINANCIAL AND OPERATING HIGHLIGHTS

Second Quarter Fiscal 2013

(Dollars in millions)

(Unaudited)

	Three Months Ended									Six Months Ended
	November 30									November 30
	2012			2011			%			2012			2011			%
FINANCIAL HIGHLIGHTS
Revenue	$	1,377		$	1,325			4	%	$	2,776		$	2,653			5	%
Operating Expenses:
Salaries and employee benefits		589			577			2	%		1,188			1,155			3	%
Purchased transportation		224			221			1	%		450			428			5	%
Rentals		29			29			—			58			57			2	%
Depreciation and amortization		52			44			18	%		105			88			19	%
Fuel		157			156			1	%		305			321			(5	%)
Maintenance and repairs		49			48			2	%		97			98			(1	%)
Intercompany charges		110			108			2	%		221			217			2	%
Other		91			102			(11	%)		186			207			(10	%)
Total Operating Expenses		1,301			1,285			1	%		2,610			2,571			2	%
Operating Income	$	76		$	40			90	%	$	166		$	82			NM
Operating Margin		5.5	%		3.0	%		2.5	pts		6.0	%		3.1	%		2.9	pts
OPERATING STATISTICS
LTL Operating Weekdays		62			62			—			127			127			—
Average Daily LTL Shipments (000s)
Priority		61.6			62.1			(1	%)		61.5			61.6			—
Economy		26.8			24.7			9	%		26.7			24.2			10	%
Total Average Daily LTL Shipments		88.4			86.8			2	%		88.2			85.8			3	%
Weight Per LTL Shipment (lbs)
Priority		1,215			1,184			3	%		1,215			1,185			3	%
Economy		989			1,057			(6	%)		994			1,069			(7	%)
Composite Weight Per LTL Shipment		1,146			1,147			—			1,148			1,152			—
LTL Yield (Revenue/CWT)
Priority	$	18.15		$	18.39			(1	%)	$	17.93		$	18.16			(1	%)
Economy		26.29			23.75			11	%		25.80			23.43			10	%
Composite LTL Yield	$	20.28		$	19.79			2	%	$	19.99		$	19.54			2	%