FedEx to Challenge DOT Order

Share this content:
FedEx Corp. plans to contest a U.S. Department of Transportation order that demands repayment of $29 million.


FedEx, Memphis, TN, said Friday that the DOT issued a final order in its review of the FedEx Express claim for compensation under the Air Transportation Safety and System Stabilization Act.


This act provided financial relief to U.S. air carriers affected by the events of Sept. 11, 2001. Under its interpretation of the act, the DOT found that FedEx Express is entitled to $72 million of compensation, $3 million more than its initial determination.


Because FedEx Express previously received $101 million under the act in 2002, the DOT has demanded repayment of $29 million.


FedEx Express said it would contest this ruling judicially and continue to pursue its compensation claim.


However, it said it no longer can conclude that collection of the entire $119 million that the company expected and recorded in fiscal 2002 is probable, so it will record a charge of $48 million in its fiscal second quarter, representing repayment of $29 million to the DOT and the write-off of a $19 million receivable.


Any additional amounts recovered by FedEx Express on this matter will be recognized in the period that they are realized, the company said.


FedEx Corp. still expects second-quarter earnings of $1.10 to $1.20 per diluted share.


Loading links....
close

Next Article in Direct Mail

Sign up to our newsletters

Company of the Week

We recently were named B2B Magazine's Direct Marketing Agency of the Year, and with good reason: We make real, measureable, positive change happen for our clients. A full-service agency founded in 1974, Bader Rutter expertly helps you get the right message to the right audience at the right time through the right channels. As we engage our clients' audiences along their journey, direct marketing (email, direct mail, phone, SMS) and behavioral marketing (SEM, retargeting, contextual) channels deliver information relevant to the needs of each stage. We are experts at implementing and leveraging marketing technologies such as CRM and marketing automation in order to synchronize sales and marketing communications. Our team of architects and activators plan, execute, measure and adjust in real time to ensure the strategy is working as needed and change things if it's not.

Find out more here »

DMN's Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here