The company to focus in our analysis is wal FedEx Corporation. This is Multinational Corporation operating several that was formed to provide courier services and express shipping. Formerly known as FDX Corporation, it provided air freight services from the Caribbean to the United States. It is changed its name from FDX to FedEx Express and later to FedEx Ground. This was a strategy meant to re-brand its subsidiaries and services. It was founded in January 1997 and now trade publicly in the New York Stock Exchange. A new subsidiary known as FedEx corporate services was created to integrate the marketing, sales and customer service in all its auxiliary branches. The company acquired two more companies that improved its service lending ability. These companies were Tower Group International, a global logistics company and World Tariff for customs and tax information. They were later re-branded to form FedEx Trade Networks.
The current chief executive officer of Fedex Corporation is Robert B. Carter. He succeeded Mr. James Barkdale who was the president until the year 2009 who went to become the CEO of Netscape communications in November 2010. Cartel’s role in the at this post he managed to acquire the necessary skills required for strategic planning and oversaw the company’s financial a crucial person in strengthening the balance sheets and to implement financial controls prior to his appointment, he had worked for the company from July 1995 and has previously held a number of positions in the company. He had previously been the boards’ vice chairman and executive vice president in addition of having served on the board of directors of the consumer goods forums.
The serving financial director of the company is Mr. Steve McDonald. He is also the executive vice president of treasury and finance. Who succeeded Mr. Jones Brown in July 2010. He served as the company’s deputy president in sales and finance. The main duty in this post include tax planning and corporate strategies, corporate merger and acquisition, investor relations, cash management and capital markets. The company’s founder Mr. Fred Smith emphasized on the use of IT as the core element of the business formula.
Recent Company’s Financial Performance
The company has committed itself to save and invest the shareholders money, and has credibly earned the trust of its customers. This is achieved by providing quality merchandise at low prices on daily basis without fail. As a result of the company’s expansion policies, the company’s net revenues improved by $34.7B to $39.3B. Impressively the company has managed to lessen the percentage of administrative and sales costs from 1.08% to 0.95% in the fiscal 2011. The net sales increase for the year 2010 was as a result of an increase in the customer flow, acquisition of Canadian subsidiaries and continuous global expansion. The 2011 fiscal year, the company added its retail square feet by 3.4%. Operating expenses moved relatively slower than the net sales. Various changes made during the 2010 fiscal year streamlined and strengthened the company’s operations.
Management’s Key Strategies
The management of the company has a strong believe that the returns on investment are the most appropriate means of sharing with their investors. The management assists the investors make assessment on employment related issues in the company. There are also measures to balance long term effects and ROI to something closer to 10% by the end of the year 2011. In the year 2011, there was an increased calculation on the investment returns, and the returns on the assets were estimated to be 19.1%. But there some noticeable decrease in some of the balance sheet totals. These were the results for the year ended January 2011.
FedEx’s operation expenses and net sales increased within the year and it is predicted that if the company keep on delivering and staying updated on products the trend will continue. The capacity to make a choice from local to global provides the company with noticeable competitive advantage. It has promised its customers and offers a wide variety of merchandise and tastes that are more relevant to the customers’ needs. This objective is made possible by the fact that the company is introducing and implementing an aggressive customer related strategy. The company has been aspiring to spread its markets to the U.S through the means of the supercenter and new formats, like the FedEx Express in both the rural and urban markets.
Business Risks Involved
The company has been experiencing immense growth in the year 2011 as per the published financial reports. In the same year, there has been a recognized decrease from unrecognized tax benefits. The income from; continuing effective income tax rate, operation before tax, net cash realized from operating activities, and the company’s global segment. There are some of the key areas of risk that the company find itself involved in. the major ones are; long term debts, operating cash flow from operating activities and international segments. But, the three risks appear to have no significant effect in the second quarter of the year 2010. When the review is done in the second and the fourth quarter of the year, it shows some strength in some few areas. The company has been providing high quality mercantile at lower prices than their competitors.
The company thus has ensured proper use of its investor’s funds and keeps the promise of giving favorable returns as dividends in the coming future. There is no investor who can be willing to invest his money in a company that has shown no recommendable growth trend. I would recommend potential investors to make their bet with FedEx Company; there exist concerned managers who keep the concern of the stakeholders in mind.