FedEx Corp. reported operating income of $987 million, up 24 per cent from $795 million last year, on revenues of $11.7 billion, up 6 per cent from $11.0 billion the previous year, for the first quarter of fiscal 2015, ended August 31, 2014. FedEx reported operating margins of 8.5 per cent, up from 7.2 per cent the previous year, primarily due to higher volumes and increased yields at all three transportation segments. Net income of $606 million was reported, up 24 per cent from last year’s $489 million. “FedEx Corp. is off to an outstanding start in fiscal 2015, thanks to very strong performance at FedEx Ground, solid volume and revenue increases at FedEx Freight and healthy growth in U.S. domestic volume at FedEx Express,” said Frederick W. Smith, FedEx Corp. Chairman, President and Chief Executive Officer. “More customers are relying on FedEx because they appreciate the competitive advantages provided by our broad portfolio of solutions.”
By Peter G. Hall, Vice-President and Chief Economist
We used to take surpluses for granted. But one key feature of post-crisis Canada was the emergence of a persistent trade deficit. In general, the word ‘deficit’ scares us, and in most cases, it should. But in this case, the red ink speaks of the resilience of Canadian domestic demand in the face of global collapse. More recently, the tables are turning, and the ink is getting blacker. Is this just a temporary shift, or is something bigger going on?
Government of Canada acts to better protect communities and taxpayers in the event of rail accidents
Lisa Raitt, Minister of Transport, launched a second stage of consultations with a view to strengthen the liability and compensation regime and ensure railways and shippers are held accountable in the event of an incident.
The government of Canada is enhancing insurance requirements for federally regulated railways and establishing supplementary compensation for incidents involving dangerous goods. Consultations began last winter and this second stage of consultations will involve discussions with key stakeholders to help define specifics of the new regime.
Once finalized, the new regime will ensure that sufficient funds are available to compensate potential victims and pay for clean-up costs in the event of a catastrophic incident. The railway disaster in Lac-Mégantic, and the insurance coverage carried by Montreal, Maine and Atlantic (MM&A) Railway at the time of the accident, highlighted the importance of strengthening the current regime.
Federally regulated railways includes two large Class I railway companies, the Canadian National Railway and the Canadian Pacific Railway, and 18 smaller Class II railway companies, also known as short-line railways. Under current legislation, a railway is required to carry adequate third-party liability insurance as a condition for receiving a certificate of fitness which allows it to operate. Whether a railway’s insurance is “adequate” is determined on a case-by-case basis, in accordance with the Railway Third Party Liability Insurance Coverage Regulations.
By Gavin van Marle
The entrance of Liquefied Natural Gas (LNG)-powered containerships on European waters could occur sooner than thought, after classification society DNV-GL presented an “Approved in Principle” award to a new deepsea boxship design. DNV-GL said the design, which would see the eleven 14,000 TEU and six 18,000 TEU ships being currently built for UASC by South Korean shipbuilder Hyundai Heavy Industries at some point converted to operate on LNG rather than the heavy fuel oil ships currently use, was “technically feasible”. “LNG as a ship fuel is a trend whose time has come,” said Tor Svensen, CEO of DNV GL Maritime.
M&A activity in the U.S. container terminal sector is currently at its highest level since the boom time of the mid-2000s. However, whilst the type of buyer is largely similar to what it was, the rationale for pursuing today’s deals is different.
The U.S. container terminal sector has seen numerous high profile deals so far this year. Most of the parties on the buy side of the deals are infrastructure and financial players – the same type of buyers that were most active in acquiring U.S. terminals in the mid-2000s. Their aims and motivations today though are somewhat different to what they were.