UPS 2015 Annual Report Download - page 41

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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
29
U.S. Domestic Package Operations
Year Ended December 31, % Change
2015 2014 2013 2015/ 2014 2014/ 2013
Average Daily Package Volume (in thousands):
Next Day Air 1,316 1,274 1,271 3.3 % 0.2 %
Deferred 1,313 1,155 1,074 13.7 % 7.5 %
Ground 12,969 12,893 12,060 0.6 % 6.9 %
Total Avg. Daily Package Volume 15,598 15,322 14,405 1.8 % 6.4 %
Average Revenue Per Piece:
Next Day Air $ 19.66 $ 20.42 $ 20.12 (3.7)% 1.5 %
Deferred 11.70 12.57 12.70 (6.9)% (1.0)%
Ground 7.98 7.85 7.96 1.7 % (1.4)%
Total Avg. Revenue Per Piece $ 9.28 $ 9.25 $ 9.39 0.3 % (1.5)%
Operating Days in Period 254 253 252
Revenue (in millions):
Next Day Air $ 6,570 $ 6,581 $ 6,443 (0.2)% 2.1 %
Deferred 3,903 3,672 3,437 6.3 % 6.8 %
Ground 26,274 25,598 24,194 2.6 % 5.8 %
Total Revenue $ 36,747 $35,851 $34,074 2.5 % 5.2 %
Operating Expenses (in millions):
Operating Expenses $ 31,980 $32,992 $29,471 (3.1)% 11.9 %
Defined Benefit Plans Mark-to-Market Charge (62)(660)—
Health & Welfare Plan Charges —(990)—
Adjusted Operating Expenses $ 31,918 $31,342 $29,471 1.8 % 6.3 %
Operating Profit (in millions) and Operating Margin:
Operating Profit $ 4,767 $ 2,859 $ 4,603 66.7 % (37.9)%
Adjusted Operating Profit $ 4,829 $ 4,509 $ 4,603 7.1 % (2.0)%
Operating Margin 13.0% 8.0% 13.5%
Adjusted Operating Margin 13.1% 12.6% 13.5%
Revenue
The change in overall revenue was impacted by the following factors for the years ended December 31, 2015 and 2014,
compared with the corresponding prior year periods:
Volume
Rates /
Product Mix
Fuel
Surcharge
Total
Revenue
Change
Revenue Change Drivers:
2015/ 2014 2.2% 2.7 % (2.4)% 2.5%
2014/ 2013 6.8% (1.6)% — % 5.2%