United Parcel Service, Inc. (NYSE:UPS) Q2 2020 Earnings Conference Call - Final Transcript

Jul 30, 2020 • 08:30 am ET


United Parcel Service, Inc. (NYSE:UPS) Q2 2020 Earnings Conference Call - Final Transcript


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Good morning. My name is Steven, and I will be your facilitator today. I would like to welcome everyone to the USInvestor Relations Second Quarter 2020 Earnings Conference Call.

[Operator Instructions]

It is now my pleasure to turn the floor over to your host. Mr. Scott Childress, Investor Relations Officer. Sir, the floor is yours.

Scott Childress

Good morning, and welcome to the USsecond quarter 2020 earnings call. Joining me today are Carol Tome, our CEO; and Brian Newman, our CFO.

Before we begin, I want to remind you that some of the comments we'll make today are forward-looking statements within the federal securities laws and address our expectation for the future performance or operating results of our company. These statements are subject to risks and uncertainties, which are described in detail in our 2019 Form 10-K, subsequently filed Form 10-Q's and other reports we filed with the Securities and Exchange Commission. These reports, when filed, are available on the USInvestor Relations website and from the SEC.

During the quarter, GAAP results included a pretax charge of $112 million, equivalent to $0.10 on an earnings per share. The charge resulted from transformation-related activities in the international and US domestic segments. In the prior year period, GAAP results included a pretax charge for transformation cost of $21 million, equivalent to $0.02 on an earnings per share. Unless stated otherwise, our comments will refer to adjusted results, which exclude transformation costs.

The webcast of today's call, along with the reconciliation of non-GAAP financial measures, are available on USInvestor Relations website. Following our prepared remarks, we will take questions from those joining us via the teleconference.

[Operator Instructions]

And now I'll turn the call over to Carol.

Carol B. Tome

Thank you, Scott, and good morning. I'm honored to be hosting my first USearnings call. Before I begin, I would like to thank David Abney, who after 46 years of service to US passed the baton to me on June 1. We wish David all the best.

USis a special company with a unique culture, powered by more than 528,000 USrs around the world. Through this time of global pandemic and social unrest, USis keeping the world moving. We have taken measures to ensure the safety of our people, while delivering critical shipments and everyday essentials, where and when they are needed. I am extremely proud of the efforts of our people to serve our customers, our communities and each other. To all USrs, thank you.

During the quarter, our team did a great job adjusting the network to respond to the needs of our customers. At the beginning of the second quarter, we assumed demand would slow. Instead, we saw just the opposite. Due to ongoing COVID-related sheltering in place, retail store closures and changes in US consumer spending fueled by the economic stimulus, we experienced unprecedented demand and record high-volume levels. As a result, our second quarter performance was stronger than we expected.

Consolidated revenue rose 13.4% from last year to $20.5 billion. Operating profit grew 7.4%