THE BUSINESSWEEK 50 RANKINGS + 25

33

United Parcel Service

Although its domestic package business has matured, UPS keeps delivering: Under CEO Mike Eskew, its expansion across Asia continues to pay off, with international sales growing 14% last year and now making up nearly one-fifth of overall revenues. In the U.S., a $600 million “package flow technology” initiative, in which computers map out overnight the most efficient way for the majority of its 56,000 drivers to run their routes the next day, is helping boost productivity and cut costs. UPS estimates the program enabled its drivers to log 3 million fewer miles in November alone, even while delivering the same number of packages as the year before. Thanks to the new technology, later this year clients will be able to reroute deliveries to a new destination while they’re en route, an unrivaled feature. These moves have helped UPS boost profits 45% over the past three years, even in a cutthroat business environment.

Overall Grade

A

Market Data

UPS

Market Value
(2/28/2007)

$75.4 Billion

Profitability*

30.8%

A-

Sales Growth Rate**

12.8%

B-

12-Month Sales

$47.5 Billion

12-Month Net Income

$4.2 Billion

Total Return Past 12 Months

-4.1%

Past 36 Months

5.0%

Economic SectorIndustrials
IndustryAir Freight & Logistics
The overall sector letter grade reflects how the weighted average of the return on income, or return on equity, and sales growth grades compare with others in the same sector. For the overall grade as well as the ROE/ROI and sales growth grades, an "A" places a company in the top 7% of its sector and an "A-" in the top 14% of the sector. The actual ranking was done using the underlying numerical measures. Grades are for information only.
* For nonfinancial companies, three-year average pretax operating profit before interest and special items as a percentage of average invested capital. For financial companies, pretax profits as a percentage of average shareholder's equity.
*Three-year average annual sales growth based on the most recently reported 36 months, calculated using the least-squares method.
$FOOTNOTE

Michael L. Eskew

Michael L. Eskew, 57

CEO since 2002


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Data as of 2/28/07 provided by Standard & Poor's Compustat