UPS announced diluted earnings per share of 88 cents for the first quarter of 2011, a 24 percent improvement over the adjusted 71 cents for the prior-year period.
Global revenue grew 7.3 percent, producing a 21 percent increase in operating profit to $1.4 billion.

On a reported basis, diluted earnings per share and operating profit increased 66 percent and 37 percent, respectively, over the same period last year. Based on that performance, UPS has increased its guidance for 2011 diluted earnings per share to a range of $4.15-to-$4.40, an increase of 17-to-24 percent over 2010 adjusted results.

For the three months ended March 31, UPS delivered 957 million packages and expanded its operating margin by 130 basis points to 11.3 percent. On a reported basis, operating margin improved 240 basis points over the prior-year period. In the first quarter of 2010, UPS incurred $175 million in charges that reduced diluted earnings per share by 18 cents. Those charges related to the U.S. domestic segment reorganization, a loss on the sale of a supply chain unit and a change in the tax filing status of a German subsidiary.

Investment firm Stifel Nicolaus, commenting on UPS' results, noted that UPS management attempted to tone down expectations after a good earnings number, citing mainly fuel price economic risks. The biggest positive, said Stifel's David Ross, was that Supply Chain and Freight margins exceeded expectations. However, there was weakness in domestic package volume growth, with management estimating a 2 percent impact to year-over-year growth from weather and Easter timing.