8-KEarnings & ResultsExhibits & Filings

FEDEX CORP 8-K Report, Financial Results (Sep 6, 2018)

Filed September 6, 2018For Securities:FDX

Summary

This 8-K filing by FedEx Corp. (FDX) on September 6, 2018, primarily serves as an explanatory note regarding the adoption of new pension accounting rules (ASU 2017-07) effective for fiscal year 2019. While these changes will impact the presentation of operating income and margin by reclassifying certain pension expenses from operating to non-operating, the company emphasizes that there will be no effect on net income or earnings per share. The filing includes recast historical financial data for fiscal years 2018 and 2017 to reflect these new accounting standards on a retrospective basis. Investors should note that this report does not contain new operational or financial results, but rather provides updated historical financial statements prepared under the new pension accounting guidance. The primary purpose is to inform stakeholders about the accounting changes and their presentation implications, ensuring transparency as FedEx transitions to these updated standards. The recast financial information is provided as Exhibit 99.1.

Key Highlights

  • 1FedEx is adopting new pension accounting rules (ASU 2017-07) effective for fiscal year 2019.
  • 2The new rules will reclassify pension expense elements, impacting operating income and margin presentation.
  • 3Pension service cost will remain in operating expenses; other pension expense elements will be non-operating.
  • 4Crucially, these accounting changes will NOT affect FedEx's net income or earnings per share.
  • 5FedEx is applying these changes retrospectively, recasting fiscal years 2018 and 2017 financial data.
  • 6Exhibit 99.1 contains the recast unaudited historical consolidated and segment financial results.
  • 7This filing is for informational purposes regarding accounting presentation, not for announcing new business results.

Frequently Asked Questions

The main purpose of this filing is to inform investors and stakeholders about FedEx's adoption of new pension accounting rules (ASU 2017-07) and to provide recast historical financial statements reflecting these changes.

The new rules will change how pension expenses are classified. Specifically, only pension service cost will be included in operating expenses, while other elements like mark-to-market adjustments will be classified as non-operating expenses. This will impact the presentation of operating income and operating margin.

No, FedEx explicitly states that these accounting changes will have no impact on its net income or earnings per share. The changes are purely presentational regarding operating vs. non-operating expenses.

The filing includes Exhibit 99.1, which provides unaudited historical consolidated and segment financial results for fiscal years 2018 and 2017, recast to conform to the new pension accounting rules. This is being done retrospectively.