UPS 2013 Annual Report Download - page 44

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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
32
International Package Operations
Year Ended December 31, % Change
2013 2012 2011 2013 / 2012 2012 / 2011
Average Daily Package Volume (in thousands):
Domestic 1,499 1,427 1,444 5.0 % (1.2)%
Export 1,034 972 942 6.4 % 3.2 %
Total Avg. Daily Package Volume 2,533 2,399 2,386 5.6 % 0.5 %
Average Revenue Per Piece:
Domestic $ 7.06 $ 7.04 $ 7.17 0.3 % (1.8)%
Export 35.18 36.88 37.85 (4.6)% (2.6)%
Total Avg. Revenue Per Piece $ 18.54 $ 19.13 $ 19.28 (3.1)% (0.8)%
Operating Days in Period 252 252 254
Revenue (in millions):
Domestic $ 2,667 $ 2,531 $ 2,628 5.4 % (3.7)%
Export 9,166 9,033 9,056 1.5 % (0.3)%
Cargo 596 560 565 6.4 % (0.9)%
Total Revenue $12,429 $12,124 $12,249 2.5 % (1.0)%
Operating Expenses (in millions):
Operating Expenses $10,672 $11,255 $10,540 (5.2)% 6.8 %
TNT Termination Fee and Related Expenses (284) — —
Gain Upon Liquidation of Foreign Subsidiary 245 — —
Defined Benefit Plan Mark-to-Market Charge —(941)(171)
Adjusted Operating Expenses $10,633 $10,314 $10,369 3.1 % (0.5)%
Operating Profit (in millions) and Operating Margin:
Operating Profit $ 1,757 $ 869 $ 1,709 102.2 % (49.2)%
Adjusted Operating Profit $ 1,796 $ 1,810 $ 1,880 (0.8)% (3.7)%
Operating Margin 14.1% 7.2% 14.0%
Adjusted Operating Margin 14.5% 14.9% 15.3%
Currency Translation Benefit / (Cost)—(in millions)*:
Revenue $ (65) $ (231)
Operating Expenses (37) 265
Operating Profit $ (102) $ 34
* Net of currency hedging; amount represents the change compared to the prior year.
Revenue
The change in overall revenue was impacted by the following factors for the years ended December 31, 2013 and 2012,
compared with the corresponding prior year periods:
Volume Rates /
Product Mix Fuel
Surcharge Currency
Total
Revenue
Change
Revenue Change Drivers:
2013 / 2012 5.6 % (1.5)% (1.1)% (0.5)% 2.5 %
2012 / 2011 (0.2)% 1.0 % 0.1 % (1.9)% (1.0)%