Reuters--FedEx Corp is stepping up cost-cutting measures to beef up profit as sluggish global economic growth curbs shipping volumes and increases customer demand for lower-priced delivery options. Shares of the world's No. 2 package delivery company rose 2.5 percent early Tuesday after it reported adjusted quarterly profit above analysts' estimates and said it was looking to cut costs further in the absence of significant economic recovery in fiscal 2013. Moderate global economic growth that keeps shippers conservative will continue into the next year, FedEx told analysts on a conference call. The massive volume of goods moved by FedEx makes its shipping trends a closely watched indicator of consumer demand and economic growth. "We believe US domestic and global economic conditions will be impacted by the European debt crisis, slowing growth in Asia," Chief Financial Officer Alan Graf said on the call. "These weaker global economic conditions have driven a shift by our customers from premium services to our deferred products. We expect that trend to continue in 2013." FedEx said it faces cost increases in fiscal 2013, including higher pension expenses and depreciation costs. The company, whose fiscal 2013 began earlier this month, told analysts it will provide more detail on its new cost-cutting initiatives in October at its investor meeting. Read more!
