<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT : SEPTEMBER 14, 1994
(DATE OF EARLIEST EVENT REPORTED)
FEDERAL EXPRESS CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE
(STATE OF INCORPORATION)
1-7806 71-0427007
(COMMISSION FILE NUMBER) (IRS EMPLOYER IDENTIFICATION NO.)
2005 CORPORATE AVENUE, MEMPHIS, TENNESSEE 38132
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:
(901) 369-3600
<PAGE>
ITEM 5. OTHER EVENTS.
On September 14, 1994, Federal Express Corporation (the "Registrant") announced
its financial results for the fiscal quarter ended August 31, 1994 by the press
release attached as Exhibit 20.1 to this report and incorporated herein by
reference.
Registrant also recently prepared Appendix A to a Preliminary Official Statement
with respect to the Indianapolis Airport Authority Special Facilities Revenue
Bonds, Series 1994 (Federal Express Corporation Project). Appendix A, attached
as Exhibit 20.2 to this report and incorporated herein by reference, contains
summaries of the Registrant's operating results and financial position and
certain operating statistics for the past five fiscal years and for the first
fiscal quarter ended August 31, 1994.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
The document attached hereto as Exhibit 12.1 is being incorporated by reference
into the Registrant's Registration Statements on Form S-3 Nos. 33-47176,
33-50013 and 33-51623.
12.1 Computation of Ratio of Earnings to Fixed Charges.
20.1 Registrant's press release, dated September 14, 1994.
20.2 Appendix A to a Preliminary Official Statement prepared with
respect to the Indianapolis Airport Authority Special
Facilities Revenue Bonds, Series 1994 (Federal Express
Corporation Project).
2
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FEDERAL EXPRESS CORPORATION
By: /s/ ALAN B. GRAF, JR
-------------------------
Alan B. Graf, Jr.
Senior Vice President and
Chief Financial Officer
Dated: September 23, 1994
3
<PAGE>
EXHIBIT INDEX
Exhibit Description of Exhibit
- ------- ----------------------
12.1 Computation of Ratio of Earnings to Fixed Charges.
20.1 Registrant's press release, dated September 14, 1994.
20.2 Appendix A to a Preliminary Official Statement prepared with
respect to the Indianapolis Airport Authority Special Facilities
Revenue Bonds, Series 1994 (Federal Express Corporation Project).
<PAGE>
EXHIBIT 12.1
<PAGE>
EXHIBIT 12.1
FEDERAL EXPRESS CORPORATION AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
Year Ended May 31, August 31,
------------------------------------------------ ------------------
1990 1991 1992 1993 1994 1993 1994
-------- -------- -------- -------- -------- -------- --------
(In thousands except ratios)
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings:
Income (loss) before income taxes.... $218,423 $ 40,942 $(146,828) $203,576 $378,462 $ 60,835 $107,267
Add back: Interest expense, net of
capitalized interest.... 199,237 196,982 176,321 168,762 152,170 38,809 37,150
Amortization of debt
issuance costs.......... 2,989 1,634 2,570 4,906 2,860 746 671
Portion of rent expense
representative of
interest factor......... 248,830 292,840 299,012 262,724 285,261 67,215 75,903
-------- -------- --------- -------- -------- -------- --------
Earnings as adjusted................. $669,479 $532,398 $ 331,075 $639,968 $818,753 $167,605 $220,991
-------- -------- --------- -------- -------- -------- --------
-------- -------- --------- -------- -------- -------- --------
Fixed Charges:
Interest expense, net of
capitalized interest............... $199,237 $196,982 $ 176,321 $168,762 $152,170 $ 38,809 $ 37,150
Capitalized interest................. 16,986 35,442 26,603 31,256 29,738 8,720 5,703
Amortization of debt issuance costs.. 2,989 1,634 2,570 4,906 2,860 746 671
Portion of rent expense
representative of interest factor.. 248,830 292,840 299,012 262,724 285,261 67,215 75,903
-------- -------- --------- -------- -------- -------- --------
$468,042 $526,898 $ 504,506 $467,648 $470,029 $115,490 $119,427
-------- -------- --------- -------- -------- -------- --------
-------- -------- --------- -------- -------- -------- --------
Ratio of Earnings to Fixed Charges 1.4 1.0 (A) 1.4 1.7 1.5 1.9
-------- -------- --------- -------- -------- -------- --------
-------- -------- --------- -------- -------- -------- --------
<FN>
(A) Earnings were inadequate to cover fixed charges by $173.4 million for the year ended May 31, 1992.
</TABLE>
<PAGE>
EXHIBIT 20.1
<PAGE>
[LETTERHEAD - FEDERAL EXPRESS]
FEDERAL EXPRESS CORPORATION
FIRST QUARTER FISCAL 1995
FINANCIAL RESULTS
FOR IMMEDIATE RELEASE
FEDERAL EXPRESS CORPORATION REPORTS
86% INCREASE IN NET INCOME FOR FIRST QUARTER
MEMPHIS, September 14, 1994 ... Federal Express Corporation today announced that
net income for the quarter ended August 31 was $61.1 million, an 86% increase
over last year's first quarter net income of $32.9 million. Earnings per share
rose to $1.08 from $0.60 per share last year.
Revenues for the quarter were $2,231.1 million, 11% higher than last year's
$2,015.7 million. Operating income increased to $143.0 million from $101.9
million, and pretax income rose to $107.3 million from $60.8 million a year ago.
International operating profit for the first quarter was $22.7 million on
international segment revenues of $596.8 million. In last year's first quarter,
the international segment reported an operating loss of $33.2 million on
revenues of $535.3 million.
-more -
<PAGE>
The company's U.S. domestic operating profit was $120.3 million on revenues of
$1,634.3 million, compared to an operating profit of $135.1 million on revenues
of $1,480.4 million in last year's first quarter.
Commenting on the quarter's results, Chairman and Chief Executive Officer
Frederick W. Smith said, "This was the eighth consecutive quarter of year-over-
year improvement in net income. The increased earnings continue to be primarily
due to improved performance in our international segment. International
Priority package volumes have increased more than 20% for the past two quarters.
In addition, revenues for international airfreight increased this quarter almost
18% year-over-year. Looking forward, our systemwide ISO 9001 certification
announced today will further advance FedEx's competitive position overseas."
Chief Financial Officer Alan B. Graf, Jr. said, "We are pleased that our cost
per package in the U.S. domestic segment declined 2.7%, year-over-year.
However, due in large part to the extremely aggressive pricing environment,
revenue per package declined 4.6%. Significant investments are continuing in
order to further reduce our cost per package and these investments are
contributing to the reduction in our current U.S. domestic profit margins."
###
Contact: Tom Martin 901-395-3490 or
Shirlee Finley 901-395-3463
091494
2
<PAGE>
FEDERAL EXPRESS CORPORATION FINANCIAL HIGHLIGHTS
FIRST QUARTER FISCAL 1995
(IN THOUSANDS, EXCEPT EARNINGS PER SHARE
AND OPERATING DATA)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
AUGUST 31
-------------------------
FINANCIAL RESULTS 1994 1993
---- ----
<S> <C> <C>
Revenues $2,231,127 $2,015,725
Operating Income 142,985 101,907
Pretax Income 107,267 60,835
Provision for Income Taxes 46,125 27,984
------ ------
Net Income $61,142 $32,851
------- -------
------- -------
Earnings Per Share $1.08 $0.60
----- -----
----- -----
Common and Common Equivalent Shares 56,614 55,186
OPERATING DATA
Operating Weekdays 65 65
U.S. Domestic Packages (000) 122,881 106,131
International Packages (000) 9,656 7,945
----- -----
Total Package Volume (000) 132,537 114,076
Avg. Revenue Per U.S. Domestic Package $13.12 $13.75
Avg. Revenue Per International Package $39.34 $38.62
Average Revenue Per Package $15.03 $15.48
Average Revenue Per Pound $2.39 $2.66
Average Pounds Per Package 6.3 5.8
International Airfreight Pounds (millions) 135.4 115.6
Average Revenue Per Airfreight Pound $1.05 $1.05
</TABLE>
<PAGE>
[LETTERHEAD - FEDERAL EXPRESS]
FINAL MONTHLY VOLUME
AUGUST 1994
FOR IMMEDIATE RELEASE
Memphis, September 14, 1994 ----- Federal Express Corporation announced today
that average daily volume of express packages and documents for August 1994
increased approximately 16% compared to August 1993. Details are shown in the
table below.
<TABLE>
<CAPTION>
Fiscal Year-To-Date
(3 months)
August 1994 August 1993 FY1995 FY1994
----------- ----------- ------ ------
<S> <C> <C> <C> <C>
Total Package Volume (000) 46,252 38,094 132,537 114,076
Operating Weekdays 23 22 65 65
AVERAGE DAILY PACKAGE VOLUME
Priority Overnight 917,555 834,958 928,651 842,154
Standard Overnight 492,314 416,309 494,958 416,969
Economy Two-Day 453,124 360,004 463,850 371,200
U.S. Express Freight (OFS/F-2) 2,865 2,295 3,022 2,462
International Priority 145,103 118,000 148,548 122,230
------- ------- ------- -------
Total Average Daily Package Volume 2,010,961 1,731,566 2,039,029 1,755,015
Percent Change in Average
Daily Package Volume 16.1% 16.2%
TOTAL INTERNATIONAL AIRFREIGHT
(millions of pounds) 46.7 39.2 135.4 115.6
<FN>
Note: Package volumes as reported do not equal package "pickups." The
number of pickups is adjusted to reflect the percentage of deliveries
completed during the respective period. Consequently, the two methods
may arbitrarily produce slightly different year-over-year comparisons.
For example, the year-over-year change in average daily package
"pickups" was 16.6% for August and 15.7% fiscal year-to-date.
</TABLE>
Contact: Tom Martin 901/395-3490
Shirlee Finley 901/395-3463
091494
<PAGE>
EXHIBIT 20.2
<PAGE>
APPENDIX A TO PRELIMINARY OFFICIAL STATEMENT
FEDERAL EXPRESS CORPORATION
Federal Express Corporation (hereinafter the "Company") was incorporated in
Delaware on June 24, 1971 and began operations in 1972. The Company offers a
wide range of express services for the time-definite transportation of
documents, packages and freight throughout the world using an extensive fleet of
aircraft and vehicles and leading-edge information technologies. Corporate
headquarters are located at 2005 Corporate Avenue, Memphis, Tennessee 38132,
telephone (901) 369-3600.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange Commission (the
"Commission") in accordance with the provisions of the Securities Exchange Act
of 1934, as amended, are incorporated herein by reference and made a part
hereof:
1. The Company's Annual Report on Form 10-K for the fiscal year ended
May 31, 1994 filed August 5, 1994.
2. The Company's Current Report on Form 8-K dated September 14, 1994
filed September 23, 1994.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act after the date of this Preliminary Official Statement and
before the termination of the offering of the Series 1994 Bonds by this
Preliminary Official Statement shall be deemed to be incorporated by reference
in this Preliminary Official Statement and to be a part hereof from the date of
filing of such documents.
Any statement contained in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for purposes of
this Preliminary Official Statement to the extent that a statement contained
herein or in any other subsequently filed document which also is or is deemed to
be incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Preliminary Official
Statement.
The Company will furnish without charge to each person to whom this Preliminary
Official Statement is delivered, on written or oral request of such person, a
copy of any or all of the documents incorporated by reference in this
Preliminary Official Statement without exhibits to such documents (unless such
exhibits are specifically incorporated by reference into such documents).
Requests for such copies should be directed to: Thomas R. Martin, Managing
Director - Public Relations, Federal Express Corporation, by mail at Box 727,
Memphis, Tennessee 38194-1850 or by telephone at (901) 395-3490.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended, and in accordance therewith files reports and
other information with the Commission. Reports, proxy and information
statements and other information filed by the Company with the Commission can be
inspected, and copies may be obtained at prescribed rates, at the Public
Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549, as well as at the following Regional Offices of the Commission: New York
Regional Office, 7 World Trade Center, New York, New York 10048 and Chicago
Regional Office, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-
2511. Such material can also be inspected at the offices of the New York Stock
Exchange, 20 Broad Street, New York, New York 10005.
A-1
<PAGE>
SELECTED OPERATING STATISTICS
(UNAUDITED)
Set forth below are selected operating statistics of the express package and
airfreight services of the Company for the periods indicated. Beginning in
1994, U.S. domestic express airfreight is reported as package volume in express
package operating data rather than as pounds in airfreight operating data. Data
for 1990 through 1993 has been restated to conform to this presentation.
Beginning in 1995, Average Revenue Per Pound and Average Revenue Per Package
include service fee revenues previously classified as other revenues. Data for
1990 through 1994 has been restated to conform to this presentation.
<TABLE>
<CAPTION>
THREE MONTHS
YEAR ENDED MAY 31 ENDED AUGUST 31
---------------------------------------------------------------------- -------------------------
1990 1991 1992 1993 1994 1993 1994
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
EXPRESS PACKAGE:
Average daily
package volume 1,234,174 1,310,890 1,472,642 1,710,561 1,925,105 1,755,015 2,039,029
Average pounds
per package 5.4 5.6 5.7 5.8 6.0 5.8 6.3
Average revenue
per pound $ 3.13 $ 3.08 $ 2.87 $ 2.60 $ 2.51 $2.66 $2.39
Average revenue
per package $16.76 $17.33 $16.38 $15.30 $15.12 $15.48 $15.03
AIRFREIGHT:
Average daily
pounds 3,148,290 2,650,204 2,258,303 2,050,033 1,844,270 1,778,508 2,083,464
Average revenue
per pound $ 1.13 $ 1.20 $ 1.22 $ 1.09 $ 1.06 $1.05 $1.05
<CAPTION>
RATIO OF EARNINGS TO FIXED CHARGES
(UNAUDITED)
THREE MONTHS
YEAR ENDED MAY 31 ENDED AUGUST 31
---------------------------------------------------------------------- -------------------------
1990 1991 1992 1993 1994 1993 1994
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to
Fixed Charges (a) 1.4x 1.0x (b) 1.4x 1.7x 1.5x 1.9x
<FN>
- ---------------
(a) Earnings included in the calculation of the ratio of earnings to fixed
charges represent income before income taxes plus fixed charges (other than
capitalized interest). Fixed charges include interest expense, capitalized
interest, amortization of debt issuance costs and a portion of rent expense
representative of interest.
(b) Earnings were inadequate to cover fixed charges by $173.4 million for the
year ended May 31, 1992.
</TABLE>
A-2
<PAGE>
SUMMARY OF CONSOLIDATED FINANCIAL INFORMATION
The following is a summary of the Company's operating results and financial
position for the periods indicated (in millions):
<TABLE>
<CAPTION>
OPERATING RESULTS
THREE MONTHS
YEAR ENDED MAY 31 ENDED AUGUST 31
------------------------------------------------------------------ -------------------
(UNAUDITED)
1990 1991 1992 1993 1994 1993 1994
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues $7,015 $7,688 $7,550 $7,808 $8,479 $2,016 $2,231
Operating Income 387 252 23 377 531 102 143
Income (Loss)
Before Income
Taxes 218 41 (147) 204 378 61 107
Income (Loss)
Before Cumulative
Effect of Change
in Accounting
Principle 116 6 (114) 110 204 33 61
Net Income (Loss) 116 6 (114) 54 204 33 61
<CAPTION>
FINANCIAL POSITION
MAY 31 AUGUST 31, 1994
------------------------------------------------------------------- ---------------
(UNAUDITED)
1990 1991 1992 1993 1994
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Current Assets $1,315 $1,283 $1,206 $1,440 $1,762 $1,802
Property and
Equipment, Net 3,566 3,624 3,411 3,476 3,449 3,483
Total Assets 5,675 5,672 5,463 5,793 5,992 6,073
Current Liabilities 1,240 1,424 1,385 1,449 1,536 1,549
Long-Term Debt 2,148 1,827 1,798 1,882 1,632 1,588
Common
Stockholders'
Investment 1,649 1,669 1,580 1,671 1,925 1,991
</TABLE>
A-3
