UPS 2010 Annual Report Download - page 124

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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
First quarter 2010 U.S. Domestic Package operating profit includes a $98 million restructuring charge
related to the reorganization of our domestic management structure, as discussed in Note 15. First quarter 2010
Supply Chain & Freight operating profit includes a $38 million loss on the sale of a specialized transportation
business in Germany, also discussed in Note 15. Additionally, first quarter 2010 net income includes a $76
million charge to income tax expense, resulting from a change in the tax filing status of a German subsidiary, as
discussed in Note 12. The combined impact of these items reduced net income by $175 million, basic earnings
per share by $0.17, and diluted earnings per share by $0.18.
Third quarter 2010 U.S. Domestic Package operating profit includes a $109 million gain on the sale of real
estate. This gain increased net income by $61 million, and basic and diluted earnings per share by $0.06.
Fourth quarter 2010 Supply Chain & Freight operating profit includes a $71 million gain on the sale of UPS
Logistics Technologies and a $13 million loss related to a financial guarantee associated with the specialized
transportation business sold in the first quarter of 2010, which are discussed in Note 15. The combined impact of
these items increased net income by $32 million, basic earnings per share by $0.04, and diluted earnings per
share by $0.03.
First quarter 2009 U.S. Domestic Package operating profit includes the $181 million impairment charge on
our McDonnell-Douglas DC-8-71 and DC-8-73 airframes, engines, and parts, as discussed in Note 4. This charge
reduced first quarter net income by $116 million, and basic and diluted earnings per share by $0.12.
Second quarter 2009 interest expense includes a $77 million charge for the remeasurement of certain
obligations denominated in foreign currencies, in which hedge accounting was not able to be applied. This charge
reduced second quarter net income by $48 million, basic earnings per share by $0.04, and diluted earnings per
share by $0.05.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
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