10-KPeriod: FY2021

UNITED PARCEL SERVICE INC Annual Report, Year Ended Dec 31, 2021

Filed February 22, 2022For Securities:UPS

Summary

United Parcel Service (UPS) reported strong financial performance for the fiscal year ended December 30, 2021, with total revenue reaching $97.3 billion, a 15% increase year-over-year. This growth was driven by a 12.6% increase in average revenue per piece, signaling successful revenue quality initiatives across its U.S. Domestic and International Package segments. The company also saw a 2.3% rise in average daily package volume, largely attributed to growth in Small and Medium-sized Businesses (SMBs) and Business-to-Business (B2B) segments. Operating profit saw a substantial increase of 66.7% to $12.8 billion, with operating margins improving significantly to 13.2%. This enhanced profitability was supported by strategic focus on customer value, operational efficiencies, and managing cost pressures, although higher fuel and third-party transportation costs were noted. Net income surged by over 850% to $12.9 billion, or $14.68 per diluted share, partly influenced by a significant pension mark-to-market gain. The company continues its 'Customer First, People Led, Innovation Driven' strategy, making investments in technology and its workforce while navigating global economic uncertainties and supply chain disruptions.

Financial Highlights

55 data points
Beta

Revenue

$97.29B

Net Income

$12.89B

13.2% Net Margin

EPS (Diluted)

$14.68

Total Assets

$69.41B

Cash & Equivalents

$10.26B

Free Cash Flow

$10.81B

Financial Statements
Beta
Revenue$97.29B
Operating Expenses$84.48B
Operating Income$12.81B
Interest Expense$694.00M
Net Income$12.89B
EPS (Basic)$14.75
EPS (Diluted)$14.68
Shares Outstanding (Basic)874.00M
Shares Outstanding (Diluted)878.00M

Key Highlights

  • 1Total revenue grew by 15% to $97.3 billion, driven by strong performance in both U.S. Domestic and International Package segments.
  • 2Average revenue per piece increased by 12.6%, reflecting effective revenue quality and pricing strategies.
  • 3Operating profit increased by 66.7% to $12.8 billion, with operating margin expanding to 13.2%.
  • 4Net income saw a significant jump of 859.8% to $12.9 billion ($14.68 EPS), boosted by a large pension mark-to-market gain.
  • 5Average daily package volume increased by 2.3%, with particular strength in SMB and B2B segments.
  • 6The company acquired Roadie, a same-day delivery platform, for $586 million to enhance its local delivery capabilities.
  • 7Divestiture of UPS Freight was completed, contributing a gain and allowing for business simplification.

Frequently Asked Questions

In 2021, UPS reported a robust financial performance with total revenue of $97.3 billion, a 15% increase from the previous year. Operating profit grew by 66.7% to $12.8 billion, and net income surged by 859.8% to $12.9 billion. This growth was driven by higher average revenue per piece and increased package volumes, particularly from SMB and B2B customers.

Revenue growth was primarily driven by a significant increase in average revenue per piece across both the U.S. Domestic Package and International Package segments, reflecting successful revenue quality initiatives and the impact of fuel and demand surcharges. Volume growth, especially from SMB and B2B customers, also contributed to the overall revenue increase.

UPS's 'Customer First, People Led, Innovation Driven' strategy played a key role. The focus on enhancing customer value, optimizing the network through technology and automation, and improving the employee value proposition contributed to revenue per piece growth and operational efficiencies, which helped offset rising costs like fuel and labor.

Key events in 2021 included the completion of the divestiture of UPS Freight and the acquisition of Roadie, a same-day delivery technology platform. These strategic moves aim to simplify operations and expand service offerings in the rapidly evolving logistics market.