ups-20211026
0001090727falseOctober 26, 202100010907272021-10-262021-10-260001090727exch:XNYS2021-10-262021-10-260001090727ups:SeniorNotes0.375Due2023Memberexch:XNYS2021-10-262021-10-260001090727ups:SeniorNotes1625Due2025Memberexch:XNYS2021-10-262021-10-260001090727ups:SeniorNotes1Due2028Memberexch:XNYS2021-10-262021-10-260001090727exch:XNYSups:SeniorNotes1.500Due2032Member2021-10-262021-10-26

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 26, 2021

ups-20211026_g1.jpg
United Parcel Service, Inc.
(Exact name of registrant as specified in its charter)
 
Delaware001-1545158-2480149
(State or other jurisdiction
of incorporation)		(Commission File Number)(IRS Employer
Identification No.)

      55 Glenlake Parkway, N.E., Atlanta, Georgia                30328
(Address of principal executive offices)                 (Zip Code)
Registrant’s telephone number, including area code (404) 828-6000
Not Applicable
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading SymbolName of Each Exchange on Which Registered
Class B common stock, par value $0.01 per shareUPSNew York Stock Exchange
0.375% Senior Notes due 2023UPS23ANew York Stock Exchange
1.625% Senior Notes Due 2025UPS25New York Stock Exchange
1% Senior Notes due 2028UPS28New York Stock Exchange
1.500% Senior Notes due 2032UPS32New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company. ☐

If an emerging growth company, indicate by check mark if the registrant has elected not use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐








Item 2.02 — Results of Operations and Financial Condition.
     
On October 26, 2021, United Parcel Service, Inc. (the “Company”) issued a press release containing information about the Company’s results of operations for the third quarter ended September 30, 2021. The Company also posted on its website at www.investors.ups.com financial statement schedules containing additional detail about the Company's results of operations for the same period.

A copy of the press release is attached hereto as Exhibit 99.1. A copy of the financial statement schedules are attached hereto as Exhibit 99.2.

Item 9.01 — Financial Statements and Exhibits.

(d) Exhibits

99.1       Press release dated October 26, 2021 "UPS RELEASES 3Q 2021 EARNINGS"
99.2 Q3 2021 financial statement schedules
104 The cover page from this Current Report on Form 8-K, formatted in Inline XBRL

The information contained in Items 2.02 and 9.01 shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filings under the Securities Act of 1933 or the Exchange Act, except as may be expressly set forth by reference in any such filing.



Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
UNITED PARCEL SERVICE, INC.
Date: October 26, 2021By:/s/ BRIAN NEWMAN
Brian Newman
Senior Vice President, Chief Financial Officer and Treasurer



Exhibit 99.1
For Immediate Release

UPS RELEASES 3Q 2021 EARNINGS

•Consolidated Revenues of $23.2B, Up 9.2% from Last Year
•Consolidated Operating Profit of $2.9B, Up 22.6% from Last Year; Up 23.4% on
an Adjusted* Basis
•Diluted EPS of $2.65, Up 18.3% from Last Year; Adjusted Diluted EPS Up 18.9%
to $2.71
•Company Raises Full-Year 2021 Financial Guidance

ATLANTA – October 26, 2021 – UPS (NYSE:UPS) today announced third-quarter 2021 consolidated revenue of $23.2 billion, a 9.2% increase over the third quarter of 2020. Consolidated operating profit was $2.9 billion, up 22.6% compared to the third quarter of 2020, and up 23.4% on an adjusted basis. Diluted earnings per share were $2.65 for the quarter, 18.3% above the same period in 2020, and up 18.9% on an adjusted basis.

For the third quarter of 2021, GAAP results include after-tax transformation and other charges of $54 million, equivalent to $0.06 per share. Year-to-date cash from operations was $11.8 billion, up 26.7% compared to the same period in 2020, with free cash flow of $9.3 billion, a 52.3% increase above the first nine months of 2020.

“I want to thank all UPSers for delivering what matters with great service to our customers,” said Carol Tomé, UPS chief executive officer. “The actions we are taking under our better not bigger strategic framework to improve revenue quality, enhance productivity and remain disciplined on capital allocation are driving our positive financial performance.”


U.S. Domestic Segment

3Q 2021
Adjusted
3Q 2021

3Q 2020
Adjusted
3Q 2020
Revenue$14,208M$13,225M
Operating profit$1,407M$1,414M$1,098M$1,133M

•Revenue was up 7.4%, driven by a 12.0% increase in revenue per piece.
•Operating margin was 9.9%; adjusted operating margin was 10.0%.

International Segment

3Q 2021
Adjusted
3Q 2021

3Q 2020
Adjusted
3Q 2020
Revenue$4,720M$4,087M
Operating profit$1,051M$1,108M$966M$972M

•Revenue increased 15.5%, with strong growth from all regions.
•Operating margin was 22.3%; adjusted operating margin was 23.5%.












Supply Chain Solutions Segment

3Q 2021
Adjusted
3Q 2021

3Q 2020
Adjusted
3Q 2020
Revenue$4,256M$3,926M
Operating profit$438M$448M$299M$302M

•Revenue increased 8.4%, led by Forwarding and Logistics, which combined grew 35.4%.
•Operating margin was 10.3%; adjusted operating margin was 10.5%.


Outlook

For the full year in 2021, the company is raising its consolidated adjusted operating margin target to approximately 13.0% and expects adjusted return on invested capital to be around 29%. Capital expenditures are now planned to be approximately $4.2 billion and the company’s effective tax rate is expected to be about 22.5%.


* “Adjusted” amounts are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial measures, including a reconciliation to the most closely correlated GAAP measure.


Contacts:
UPS Media Relations: 404-828-7123 or [email protected]
UPS Investor Relations: 404-828-6059 (option 4) or [email protected]

# # #


Conference Call Information


UPS CEO Carol Tomé and CFO Brian Newman will discuss third-quarter results with investors and analysts during a conference call at 8:30 a.m. ET, October 26, 2021. That call will be open to others through a live Webcast. To access the call, go to www.investors.ups.com and click on “Earnings Conference Call.” Additional financial information is included in the detailed financial schedules being posted on www.investors.ups.com under “Quarterly Earnings and Financials” and as filed with the SEC as an exhibit to our Current Report on Form 8-K.

About UPS

UPS (NYSE: UPS) is one of the world’s largest companies, with 2020 revenue of $84.6 billion, and provides a broad range of integrated logistics solutions for customers in more than 220 countries and territories. Focused on its purpose statement, “Moving our world forward by delivering what matters,” the company’s more than 540,000 employees embrace a strategy that is simply stated and powerfully executed: Customer First. People Led. Innovation Driven. UPS is committed to reducing its impact on the environment and supporting the communities we serve around the world. UPS also takes an unwavering stance in support of diversity, equality, and inclusion. More information can be found at www.ups.com, about.ups.com and www.investors.ups.com.

Forward-Looking Statements

This release and our filings with the Securities and Exchange Commission contain and in the future may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than those of current or historical fact, and all statements accompanied by terms such as “will,” “believe,” “project,” “expect,” “estimate,” “assume,” “intend,” “anticipate,” “target,” “plan,” and similar terms, are intended to be forward-looking statements. Forward-looking statements are made subject to the safe harbor provisions of the federal securities laws pursuant to Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

From time to time, we also include written or oral forward-looking statements in other publicly disclosed materials. Such statements may relate to our intent, belief, forecasts of, or current expectations about our strategic direction, prospects, future results, or future events; they do not relate strictly to historical or current facts. Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any forward-looking statements because such statements speak only as of the date when made and the future, by its very nature, cannot be predicted with certainty.

Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or anticipated results. These risks and uncertainties, include, but are not limited to: continued uncertainties related to the impact of the COVID-19 pandemic on our business and operations, financial performance and liquidity, our customers and suppliers, and on the global economy; changes in general economic conditions, in the U.S. or internationally; significant competition on a local, regional, national and international basis; changes in our relationships with our significant customers; changes in the regulatory environment in the U.S. or internationally; increased or more complex physical or data security requirements; legal, regulatory or market responses to global climate change; results of negotiations and ratifications of labor contracts; strikes, work stoppages or slowdowns by our employees; the effects of changing prices of energy, including gasoline, diesel and jet fuel, and interruptions in supplies of these commodities; changes in exchange rates or interest rates; uncertainty from the expected discontinuance of LIBOR and transition to any other interest rate benchmark; our ability to maintain our brand image; our ability to attract and retain qualified employees; breaches in data security; disruptions to the Internet or our technology infrastructure; interruptions in or impacts on our business from natural or man-made events


or disasters including terrorist attacks, epidemics or pandemics; our ability to accurately forecast our future capital investment needs; exposure to changing economic, political and social developments in international and emerging markets; changes in business strategy, government regulations, or economic or market conditions that may result in impairment of our assets; increases in our expenses or funding obligations relating to employee health, retiree health and/or pension benefits; potential additional U.S. or international tax liabilities; potential claims or litigation related to labor and employment, personal injury, property damage, business practices, environmental liability and other matters; our ability to realize the anticipated benefits from acquisitions, dispositions, joint ventures or strategic alliances; our ability to realize the anticipated benefits from our transformation initiatives; cyclical and seasonal fluctuations in our operating results; our ability to manage insurance and claims expenses; and other risks discussed in our filings with the Securities and Exchange Commission from time to time, including our Annual Report on Form 10-K for the year ended December 31, 2020 and subsequently filed reports. You should consider the limitations on, and risks associated with, forward-looking statements and not unduly rely on the accuracy of predictions contained in such forward-looking statements. We do not undertake any obligation to update forward-looking statements to reflect events, circumstances, changes in expectations, or the occurrence of unanticipated events after the date of those statements.


Reconciliation of GAAP and non-GAAP Financial Measures

From time to time we supplement the reporting of our financial information determined under generally accepted accounting principles ("GAAP") with certain non-GAAP financial measures. These include: "adjusted" compensation and benefits; operating expenses; operating profit; operating margin; other income and (expense); income before income taxes; income tax expense; effective tax rate; net income and earnings per share. We present revenue and revenue per piece on a constant currency basis. Additionally, we disclose free cash flow and return on invested capital (“ROIC”).

We believe that these non-GAAP measures provide meaningful information to assist users of our financial statements in more fully understanding our financial results and cash flows and assessing our ongoing performance, because they exclude items that may not be indicative of, or are unrelated to, our underlying operations and may provide a useful baseline for analyzing trends in our underlying businesses. These non-GAAP measures are used internally by management for business unit operating performance analysis, business unit resource allocation and in connection with incentive compensation award determinations.

Non-GAAP financial measures should be considered in addition to, and not as an alternative for, our reported results prepared in accordance with GAAP. Our adjusted financial information does not represent a comprehensive basis of accounting. Therefore, our adjusted financial information may not be comparable to similarly titled information reported by other companies.

Restructuring and Other Charges

Adjusted operating profit, operating margin, income before income taxes, net income and earnings per share may exclude the impact of charges related to any restructuring programs, including transformation costs and asset impairments.

Changes in Foreign Currency Exchange Rates and Hedging Activities

Currency-neutral revenue, revenue per piece and operating profit exclude the period over period impact of foreign currency exchange rate changes and any foreign currency hedging activities. These measures are calculated by dividing current period reported U.S. dollar revenue, revenue per piece and operating profit by the current period average exchange rates to derive current period local currency revenue, revenue per piece and operating profit. The derived amounts are then multiplied by the average foreign exchange rates used to translate the comparable results for each month in the prior year period (including


the impact of any foreign currency hedging activities). The difference between the current period reported U.S. dollar revenue, revenue per piece and operating profit and the derived current period U.S. dollar revenue, revenue per piece and operating profit is the period over period impact of foreign currency exchange rates and hedging activities.

Mark-To-Market Pension and Postretirement Adjustments

We recognize changes in the fair value of plan assets and net actuarial gains and losses in excess of a 10% corridor for our pension and postretirement defined benefit plans immediately as part of other pension income (expense). We supplement our presentation of certain financial data with non-GAAP measures that exclude the impact of gains and losses recognized in excess of the 10% corridor and the related income tax effects. We believe excluding these mark-to-market impacts provides important supplemental information by removing the volatility associated with short-term changes in market interest rates, equity values, and similar factors.

The deferred income tax effects of mark-to-market pension and postretirement adjustments are calculated by multiplying the statutory tax rates applicable in each tax jurisdiction, including the U.S. federal jurisdiction and various U.S. state and non-U.S. jurisdictions, by the adjustments.

Free Cash Flow

We calculate free cash flow as cash flows from operating activities less capital expenditures, proceeds from disposals of property, plant and equipment, and plus or minus the net changes in finance receivables and other investing activities. We believe free cash flow is an important indicator of how much cash is generated by our ongoing business operations and we use this as a measure of incremental cash available to invest in our business, meet our debt obligations and return cash to shareowners.

Return on Invested Capital

ROIC is calculated as the trailing twelve months (“TTM”) of adjusted operating income divided by the average of total debt, non-current pension and postretirement benefit obligations and shareowners’ equity, at the current period end and the corresponding period end of the prior year. Because ROIC is not a measure defined by GAAP, we calculate it, in part, using non-GAAP financial measures that we believe are most indicative of our ongoing business performance. We consider ROIC to be a useful measure for evaluating the effectiveness and efficiency of our long-term capital investments.

Forward-Looking Non-GAAP Metrics

From time to time when presenting forward-looking non-GAAP metrics, we are unable to provide quantitative reconciliations to the most closely correlated GAAP measure due to the uncertainty in the timing, amount or nature of any adjustments, which could be material in any period.















Reconciliation of GAAP and Non-GAAP Income Statement Items
(in millions, except per share amounts):
Three Months Ended September 30, 2021
As-Reported (GAAP)
Transformation & Other Adj.(1)
As-Adjusted
(Non-GAAP)
Operating profit:
U.S. Domestic Package$1,407 $7 $1,414 
International Package1,051 57 1,108 
Supply Chain Solutions438 10 448 
Operating Profit2,896 74 2,970 
Other Income and (Expense):
Other pension income (expense)285 — 285 
   Investment income (expense) and other(11)— (11)
   Interest expense(177)— (177)
Total Other Income (Expense)$97 $— $97 
Income Before Income Taxes2,993 74 3,067 
Income Tax Expense664 20 684
Net Income$2,329 $54 $2,383 
Basic Earnings Per Share$2.66 $0.06 $2.72 
Diluted Earnings Per Share$2.65 $0.06 $2.71 


(1) Transformation & Other of $74 million reflects other employee benefits costs of $33 million and other costs of $41 million.
    





















Reconciliation of Currency Adjusted Revenue, Revenue Per Piece, and Adjusted Operating Profit
(in millions, except per piece amounts):
Three Months Ended September 30,
2021
As-Reported
(GAAP)		2020
As-Reported
(GAAP)		% Change
(GAAP)		Currency
Impact
2021
Currency
Neutral
(Non-GAAP)(1)
% Change
(Non-GAAP)
Average Revenue Per Piece:
International Package:
   Domestic$7.19 $6.61 8.8 %$(0.16)$7.03 6.4 %
   Export33.56 28.98 15.8 %(0.36)33.20 14.6 %
      Total International Package$19.80 $17.37 14.0 %$(0.26)$19.54 12.5 %
Consolidated$12.50 $11.06 13.0 %$(0.04)$12.46 12.7 %
Revenue:
  U.S. Domestic Package$14,208 $13,225 7.4 %$— $14,208 7.4 %
  International Package4,720 4,087 15.5 %(58)4,662 14.1 %
  Supply Chain Solutions4,256 3,926 8.4 %(12)4,244 8.1 %
  Total revenue$23,184 $21,238 9.2 %$(70)$23,114 8.8 %
(1) Amounts adjusted for period over period foreign currency exchange rate and hedging differences
2021
As-Adjusted
(Non-GAAP)(1)
2020
As-Adjusted
(Non-GAAP)(1)
% Change
(Non-GAAP)		Currency
Impact
2021
As-Adjusted
Currency
Neutral
(Non-GAAP)(2)
% Change
(Non-GAAP)
As-Adjusted Operating Profit:
  U.S. Domestic Package$1,414 $1,133 24.8 %$— $1,414 24.8 %
  International Package1,108 972 14.0 %(20)1,088 11.9 %
  Supply Chain Solutions448 302 48.3 %17 465 54.0 %
  Total operating profit$2,970 $2,407 23.4 %$(3)$2,967 23.3 %
(1) Amounts adjusted for transformation & other
(2) Amounts adjusted for transformation & other and period over period foreign currency exchange rate and hedging differences


















Reconciliation of Free Cash Flow (Non-GAAP measure)
(in millions):
Nine Months Ended September 30,
2021
Cash flows from operating activities$11,761 
Capital expenditures(2,570)
Proceeds from disposals of PP&E22 
Net change in finance receivables28 
Other investing activities24 
   Free Cash Flow (Non-GAAP measure)$9,265 


Amounts are subject to reclassification.







Exhibit 99.2
United Parcel Service, Inc.
Selected Financial Data - Third Quarter
(unaudited)

Three Months Ended
September 30
20212020Change% Change
(amounts in millions, except per share data)
Statement of Income Data:
Revenue:
  U.S. Domestic Package$14,208 $13,225 $983 7.4 %
  International Package4,720 4,087 633 15.5 %
  Supply Chain Solutions(2)
4,256 3,926 330 8.4 %
  Total revenue23,184 21,238 1,946 9.2 %
Operating expenses:
  U.S. Domestic Package12,801 12,127 674 5.6 %
  International Package3,669 3,121 548 17.6 %
  Supply Chain Solutions(2)
3,818 3,627 191 5.3 %
  Total operating expenses20,288 18,875 1,413 7.5 %
Operating profit:
  U.S. Domestic Package1,407 1,098 309 28.1 %
  International Package1,051 966 85 8.8 %
  Supply Chain Solutions(2)
438 299 139 46.5 %
  Total operating profit2,896 2,363 533 22.6 %
Other income (expense):
 Other pension income (expense)285 327 (42)(12.8)%
  Investment income (expense) and other(11)11 (22)(200.0)%
  Interest expense(177)(176)(1)0.6 %
  Total other income (expense)97 162 (65)(40.1)%
Income before income taxes2,993 2,525 468 18.5 %
Income tax expense (benefit)664 568 96 16.9 %
Net income $2,329 $1,957 $372 19.0 %
Net income as a percentage of revenue10.0 %9.2 %
Per share amounts:
  Basic earnings per share$2.66 $2.25 $0.41 18.2 %
  Diluted earnings per share$2.65 $2.24 $0.41 18.3 %
Weighted-average shares outstanding:
  Basic875 868 7 0.8 %
  Diluted879 872 7 0.8 %
As Adjusted Income Data (1):
Operating profit:
  U.S. Domestic Package $1,414 $1,133 $281 24.8 %
  International Package 1,108 972 136 14.0 %
  Supply Chain Solutions(2)
448 302 146 48.3 %
  Total operating profit 2,970 2,407 563 23.4 %
Total other income (expense)$97 $162 $(65)(40.1)%
Income before income taxes $3,067 $2,569 $498 19.4 %
Net income $2,383 $1,990 $393 19.7 %
Basic earnings per share $2.72 $2.29 $0.43 18.8 %
Diluted earnings per share $2.71 $2.28 $0.43 18.9 %
(1) See Non-GAAP schedules for reconciliation of adjustments.
(2) The divestiture of UPS Freight was completed on April 30, 2021.

Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Selected Operating Data - Third Quarter
(unaudited)
Three Months Ended
September 30
20212020Change% Change
Revenue (in millions):
U.S. Domestic Package:
   Next Day Air$2,415 $2,098 $317 15.1 %
   Deferred1,304 1,378 (74)(5.4)%
   Ground10,489 9,749 740 7.6 %
      Total U.S. Domestic Package14,208 13,225 983 7.4 %
International Package:
   Domestic852 776 76 9.8 %
   Export3,641 3,153 488 15.5 %
   Cargo and Other227 158 69 43.7 %
      Total International Package4,720 4,087 633 15.5 %
Supply Chain Solutions(1):
   Forwarding2,625 1,753 872 49.7 %
Logistics1,158 1,040 118 11.3 %
   Freight— 870 (870)(100.0)%
   Other473 263 210 79.8 %
      Total Supply Chain Solutions(1)
4,256 3,926 330 8.4 %
Consolidated$23,184 $21,238 $1,946 9.2 %
Consolidated volume (in millions)1,497 1,550 (53)(3.4)%
Operating weekdays64 65 (1)(1.5)%
Average Daily Package Volume (in thousands):
U.S. Domestic Package:
   Next Day Air1,949 1,915 34 1.8 %
   Deferred1,501 1,657 (156)(9.4)%
   Ground16,385 16,803 (418)(2.5)%
      Total U.S. Domestic Package19,835 20,375 (540)(2.7)%
International Package:
   Domestic1,851 1,806 45 2.5 %
   Export1,695 1,674 21 1.3 %
      Total International Package3,546 3,480 66 1.9 %
Consolidated23,381 23,855 (474)(2.0)%
Average Revenue Per Piece:
U.S. Domestic Package:
   Next Day Air$19.36 $16.85 $2.51 14.9 %
   Deferred13.57 12.790.78 6.1 %
   Ground10.00 8.93 1.07 12.0 %
      Total U.S. Domestic Package11.199.99 1.20 12.0 %
International Package:
   Domestic7.19 6.61 0.58 8.8 %
   Export33.5628.984.58 15.8 %
      Total International Package19.80 17.37 2.43 14.0 %
Consolidated$12.50 $11.06 $1.44 13.0 %
(1) The divestiture of UPS Freight was completed on April 30, 2021.





Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Detail of Operating Expenses - Third Quarter
(unaudited)
Three Months Ended
September 30
20212020Change% Change
(in millions)
Compensation and benefits$11,148 $11,077 $71 0.6 %
Repairs and maintenance619 576 43 7.5 %
Depreciation and amortization738 677 61 9.0 %
Purchased transportation4,638 3,937 701 17.8 %
Fuel950 618 332 53.7 %
Other occupancy384 376 8 2.1 %
Other expenses1,811 1,614 197 12.2 %
Total operating expenses$20,288 $18,875 $1,413 7.5 %


























































Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Selected Financial Data - Year to Date
(unaudited)

Nine Months Ended
September 30
20212020Change% Change
(amounts in millions, except per share data)
Statement of Income Data:
Revenue:
  U.S. Domestic Package$42,620 $37,755 $4,865 12.9 %
  International Package14,144 11,175 2,969 26.6 %
  Supply Chain Solutions(2)
12,752 10,802 1,950 18.1 %
  Total revenue69,516 59,732 9,784 16.4 %
Operating expenses:
  U.S. Domestic Package38,287 35,111 3,176 9.0 %
  International Package10,824 8,887 1,937 21.8 %
  Supply Chain Solutions(2)
11,486 10,087 1,399 13.9 %
  Total operating expenses60,597 54,085 6,512 12.0 %
Operating profit (loss):
  U.S. Domestic Package4,333 2,644 1,689 63.9 %
  International Package3,320 2,288 1,032 45.1 %
  Supply Chain Solutions(2)
1,266 715 551 77.1 %
  Total operating profit8,919 5,647 3,272 57.9 %
Other income (expense):
 Other pension income (expense)4,190 981 3,209 327.1 %
  Investment income (expense) and other45 30 15 50.0 %
  Interest expense(521)(526)5 (1.0)%
  Total other income (expense)3,714 485 3,229 N/M
Income before income taxes12,633 6,132 6,501 106.0 %
Income tax expense (benefit)2,836 1,442 1,394 96.7 %
Net income $9,797 $4,690 $5,107 108.9 %
Net income as a percentage of revenue14.1 %7.9 %
Per share amounts:
  Basic earnings per share$11.21 $5.42 $5.79 106.8 %
  Diluted earnings per share$11.16 $5.39 $5.77 107.1 %
Weighted-average shares outstanding:
  Basic874 866 8 0.9 %
  Diluted878 870 8 0.9 %
As Adjusted Income Data (1):
Operating profit:
  U.S. Domestic Package $4,552 $2,749 $1,803 65.6 %
  International Package 3,389 2,372 1,017 42.9 %
  Supply Chain Solutions(2)
1,251 727 524 72.1 %
  Total operating profit 9,192 5,848 3,344 57.2 %
Total other income (expense)$424 $485 $(61)(12.6)%
Income before income taxes $9,616 $6,333 $3,283 51.8 %
Net income $7,500 $4,841 $2,659 54.9 %
Basic earnings per share $8.58 $5.59 $2.99 53.5 %
Diluted earnings per share $8.54 $5.56 $2.98 53.6 %
(1) See Non-GAAP schedules for reconciliation of adjustments.
(2) The divestiture of UPS Freight was completed on April 30, 2021.



Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Selected Operating Data - Year to Date
(unaudited)
Nine Months Ended
September 30
20212020Change% Change
Revenue (in millions):
U.S. Domestic Package:
   Next Day Air$7,202 $6,137 $1,065 17.4 %
   Deferred3,877 3,873 4 0.1 %
   Ground31,541 27,745 3,796 13.7 %
      Total U.S. Domestic Package42,620 37,755 4,865 12.9 %
International Package:
   Domestic2,716 2,183 533 24.4 %
   Export10,808 8,538 2,270 26.6 %
   Cargo and Other620 454 166 36.6 %
      Total International Package14,144 11,175 2,969 26.6 %
Supply Chain Solutions(1):
   Forwarding7,006 4,897 2,109 43.1 %
Logistics3,424 2,862 562 19.6 %
   Freight1,064 2,360 (1,296)(54.9)%
   Other1,258 683 575 84.2 %
      Total Supply Chain Solutions(1)
12,752 10,802 1,950 18.1 %
Consolidated$69,516 $59,732 $9,784 16.4 %
Consolidated volume (in millions)4,569 4,466 103 2.3 %
Operating weekdays191 193 (2)(1.0)%
Average Daily Package Volume (in thousands):
U.S. Domestic Package:
   Next Day Air2,010 1,888 122 6.5 %
   Deferred1,532 1,617 (85)(5.3)%
   Ground16,689 16,346 343 2.1 %
      Total U.S. Domestic Package20,231 19,851 380 1.9 %
International Package:
   Domestic1,943 1,746 197 11.3 %
   Export1,746 1,545 201 13.0 %
      Total International Package3,689 3,291 398 12.1 %
Consolidated23,920 23,142 778 3.4 %
Average Revenue Per Piece:
U.S. Domestic Package:
   Next Day Air$18.76 $16.84 $1.92 11.4 %
   Deferred13.25 12.410.84 6.8 %
   Ground9.898.79 1.10 12.5 %
      Total U.S. Domestic Package11.039.85 1.18 12.0 %
International Package:
   Domestic7.32 6.48 0.84 13.0 %
   Export32.4128.633.78 13.2 %
      Total International Package19.19 16.88 2.31 13.7 %
Consolidated$12.29 $10.85 $1.44 13.3 %
(1) The divestiture of UPS Freight was completed on April 30, 2021.





Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Detail of Operating Expenses - Year to Date
(unaudited)
Nine Months Ended
September 30
20212020Change% Change
(in millions)
Compensation and benefits$33,958 $32,006 $1,952 6.1 %
Repairs and maintenance1,837 1,693 144 8.5 %
Depreciation and amortization2,199 1,986 213 10.7 %
Purchased transportation13,327 10,584 2,743 25.9 %
Fuel2,672 1,878 794 42.3 %
Other occupancy1,252 1,114 138 12.4 %
Other expenses5,352 4,824 528 10.9 %
Total operating expenses$60,597 $54,085 $6,512 12.0 %


























































Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Consolidated Balance Sheets
September 30, 2021 (unaudited) and December 31, 2020

September 30, 2021December 31, 2020
(amounts in millions)
ASSETS
Current Assets:
Cash and cash equivalents$10,212 $5,910 
Marketable securities348 406 
Accounts receivables10,602 10,888 
Less: Allowance for credit losses(128)(138)
Accounts receivable, net10,474 10,750 
Assets held for sale— 1,197 
Other current assets1,809 1,953 
 Total Current Assets22,843 20,216 
Property, Plant and Equipment, Net32,859 32,254 
Operating Lease Right-Of-Use Assets3,460 3,073 
Goodwill3,332 3,367 
Intangible Assets, Net2,224 2,274 
Investments and Restricted Cash24 25 
Deferred Income Tax Assets181 527 
Other Non-Current Assets816 672 
Total Assets $65,739 $62,408 
LIABILITIES AND SHAREOWNERS' EQUITY
Current Liabilities:
Current maturities of long-term debt, commercial paper and finance leases$1,268 $2,623 
Current maturities of operating leases552 560 
Accounts payable6,445 6,455 
Accrued wage and withholdings3,805 3,569 
Self-insurance reserves1,093 1,085 
Accrued group welfare and retirement plan contributions957 927 
Liabilities to be disposed of— 347 
Other current liabilities 1,352 1,450 
Total Current Liabilities15,472 17,016 
Long-Term Debt and Finance Leases20,838 22,031 
Non-Current Operating Leases2,938 2,540 
Pension and Postretirement Benefit Obligations7,672 15,817 
Deferred Income Tax Liabilities2,775 488 
Other Non-Current Liabilities3,987 3,847 
Shareowners' Equity:
Class A common stock2 2 
Class B common stock7 7 
Additional paid-in capital1,088 865 
Retained earnings13,973 6,896 
Accumulated other comprehensive loss(3,029)(7,113)
Deferred compensation obligations16 20 
Less: Treasury stock(16)(20)
Total Equity for Controlling Interest12,041 657 
Noncontrolling interests16 12 
Total Shareowners' Equity12,057 669 
Total Liabilities and Sharewoners' Equity$65,739 $62,408 



Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Statements of Consolidated Cash Flows
(unaudited)
(amounts in millions)Nine Months Ended
September 30,
20212020
Cash Flows From Operating Activities:
Net income$9,797 $4,690 
Adjustments to reconcile net income to net cash from operating activities:
 Depreciation and amortization 2,199 1,986 
 Pension and postretirement benefit expense (2,656)481 
 Pension and postretirement benefit contributions (331)(1,307)
 Self-insurance reserves 122 388 
 Deferred tax (benefit) expense 1,271 566 
 Stock compensation expense 700 508 
 Other (gains) losses 33 164 
Changes in assets and liabilities, net of effects of business acquisitions:
 Accounts receivable (21)352 
 Other assets 256 391 
 Accounts payable 20 (450)
 Accrued wages and withholdings 306 1,330 
 Other liabilities 65 120 
Other operating activities— 64 
 Net cash from operating activities 11,761 9,283 
Cash Flows From Investing Activities:
Capital expenditures(2,570)(3,219)
Proceeds from disposal of businesses, property, plant and equipment870 10 
Purchases of marketable securities(197)(202)
Sales and maturities of marketable securities257 309 
Net change in finance receivables28 24 
Cash paid for business acquisitions, net of cash and cash equivalents acquired(12)(13)
Other investing activities24 (15)
Net cash used in investing activities(1,600)(3,106)
Cash Flows From Financing Activities:
Net change in short-term debt— (1,924)
Proceeds from long-term borrowings— 5,003 
Repayments of long-term borrowings(2,613)(2,746)
Purchases of common stock(500)(224)
Issuances of common stock196 214 
Dividends(2,578)(2,528)
Other financing activities(361)(351)
Net cash used in financing activities(5,856)(2,556)
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash(3)(19)
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash4,302 3,602 
Cash, Cash Equivalents and Restricted Cash:
Beginning of period5,910 5,238 
End of period$10,212 $8,840 







Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Reconciliation of Free Cash Flow (Non-GAAP measure)
(unaudited)
(amounts in millions)Nine Months Ended
September 30,
20212020
Cash flows from operating activities$11,761 $9,283 
Capital expenditures(2,570)(3,219)
Proceeds from disposals of PP&E22 10 
Net change in finance receivables28 24 
Other investing activities24 (15)
   Free Cash Flow (Non-GAAP measure)$9,265 $6,083 














































Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Reconciliation of GAAP and As Adjusted Income Statement Data
(unaudited)
Three Months Ended September 30,
(in millions, except per share amounts)20212020
As Reported (GAAP)
Transformation & Other Adj.(1)
As Adjusted
(Non-GAAP)		As Reported (GAAP)
Transformation & Other Adj.(2)
As Adjusted
(Non-GAAP)
U.S. Domestic Package$1,407 $7 1,414 $1,098 $35 $1,133 
International Package1,051 57 1,108 966 6 972 
Supply Chain Solutions(3)
438 10 448 299 3 302 
Operating profit2,896 74 2,970 2,363 44 2,407 
Other Income and (Expense):
Other pension income (expense)285 — 285 327 — 327 
Investment income (expense) and other(11)— (11)11 — 11 
Interest expense(177)— (177)(176)— (176)
Total Other Income (Expense)$97 $— $97 $162 $— $162 
Income Before Income Taxes2,993 74 3,067 2,525 44 2,569 
Income Tax Expense664 20 684568 11 579
Net Income$2,329 $54 $2,383 $1,957 $33 $1,990 
Basic Earnings Per Share$2.66 $0.06 $2.72 $2.25 $0.04 $2.29 
Diluted Earnings Per Share$2.65 $0.06 $2.71 $2.24 $0.04 $2.28 
Weighted-average shares outstanding:
Basic875 868 
Diluted879 872 

(1) Transformation & Other of $74 million reflects other employee benefits costs of $33 million and other costs of $41 million.

(2) Transformation & Other of $44 million reflects other employee benefits costs of $18 million and other costs of $26 million.

(3) The divestiture of UPS Freight was completed on April 30, 2021.


























Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Reconciliation of GAAP and As Adjusted Income Statement Data
(unaudited)
Nine Months Ended September 30,
(in millions, except per share amounts)20212020
As Reported (GAAP)
Pension MTM Adj(1).
Transformation & Other Adj.(2)
As Adjusted
(Non-GAAP)		As Reported (GAAP)
Transformation & Other Adj.(3)
As Adjusted
(Non-GAAP)
U.S. Domestic Package$4,333 $— 219 $4,552 $2,644 $105 $2,749 
International Package3,320 — 69 3,389 2,288 84 2,372 
Supply Chain Solutions(4)
1,266 — (15)1,251 715 12 727 
Operating profit8,919 — 273 9,192 5,647 201 5,848 
Other Income and (Expense):
Other pension income (expense)4,190 (3,290)— 900 981 — 981 
Investment income (expense) and other45 — — 45 30 — 30 
Interest expense(521)— — (521)(526)— (526)
Total Other Income (Expense)$3,714 $(3,290)$— $424 $485 $— $485 
Income Before Income Taxes12,633 (3,290)273 9,616 6,132 201 6,333 
Income Tax Expense2,836 (788)682,116 1,442 50 1492
Net Income$9,797 $(2,502)$205 $7,500 $4,690 $151 $4,841 
Basic Earnings Per Share$11.21 $(2.86)$0.23 $8.58 $5.42 $0.17 $5.59 
Diluted Earnings Per Share$11.16 $(2.85)$0.23 $8.54 $5.39 $0.17 $5.56 
Weighted-average shares outstanding:
Basic874 866 
Diluted878 870 

(1) Represents a mark-to-market gain recognized outside of a 10% corridor to the UPS IBT Pension Plan

(2) Transformation & Other of $273 million reflects a gain on the divestiture of UPS Freight of $101 million net of previously-recognized valuation allowance of $66 million, other employee benefits costs of $164 million and other costs of $144 million.

(3) Transformation & Other of $201 million reflects other employee benefits costs of $111 million and other costs of $90 million.

(4) The divestiture of UPS Freight was completed on April 30, 2021.























Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Supplemental Analysis of Currency - Third Quarter
(unaudited)

Currency Neutral Revenue Per Piece, Revenue and As Adjusted Operating Profit
Three Months EndedCurrency
September 30Neutral
20212020% ChangeCurrency
2021 (1)
% Change
Average Revenue Per Piece:
International Package:
   Domestic$7.19 $6.61 8.8 %$(0.16)$7.03 6.4 %
   Export33.56 28.98 15.8 %(0.36)33.20 14.6 %
      Total International Package$19.80 $17.37 14.0 %$(0.26)$19.54 12.5 %
Consolidated$12.50 $11.06 13.0 %$(0.04)$12.46 12.7 %
Three Months EndedCurrency
September 30Neutral
20212020% ChangeCurrency
2021(1)
% Change
Revenue (in millions):
  U.S. Domestic Package$14,208 $13,225 7.4 %$— $14,208 7.4 %
  International Package4,720 4,087 15.5 %(58)4,662 14.1 %
  Supply Chain Solutions(3)
4,256 3,926 8.4 %(12)4,244 8.1 %
  Total revenue$23,184 $21,238 9.2 %$(70)$23,114 8.8 %
Three Months EndedCurrency
September 30Neutral
20212020% ChangeCurrency
2021(1)
% Change
As-Adjusted Operating Profit (in millions)(2):
  U.S. Domestic Package$1,414 $1,133 24.8 %$— $1,414 24.8 %
  International Package1,108 972 14.0 %(20)1,088 11.9 %
  Supply Chain Solutions(3)
448 302 48.3 %17 465 54.0 %
  Total operating profit$2,970 $2,407 23.4 %$(3)$2,967 23.3 %

(1) Amounts adjusted for period over period foreign currency exchange rate and hedging differences

(2) Amounts adjusted for transformation & other

(3) The divestiture of UPS Freight was completed on April 30, 2021.




















Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Supplemental Analysis of Currency - Year to Date
(unaudited)

Currency Neutral Revenue Per Piece, Revenue and As Adjusted Operating Profit
Nine Months EndedCurrency
September 30Neutral
20212020% ChangeCurrency
2021 (1)
% Change
Average Revenue Per Piece:
International Package:
   Domestic$7.32 $6.48 13.0 %$(0.43)$6.89 6.3 %
   Export32.41 28.63 13.2 %(0.86)31.55 10.2 %
      Total International Package$19.19 $16.88 13.7 %$(0.63)$18.56 10.0 %
Consolidated$12.29 $10.85 13.3 %$(0.10)$12.19 12.4 %
Nine Months EndedCurrency
September 30Neutral
20212020% ChangeCurrency
2021(1)
% Change
Revenue (in millions):
  U.S. Domestic Package$42,620 $37,755 12.9 %$— $42,620 12.9 %
  International Package14,144 11,175 26.6 %(452)13,692 22.5 %
  Supply Chain Solutions(3)
12,752 10,802 18.1 %(121)12,631 16.9 %
  Total revenue$69,516 $59,732 16.4 %$(573)$68,943 15.4 %
Nine Months EndedCurrency
September 30Neutral
20212020% ChangeCurrency
2021(1)
% Change
As-Adjusted Operating Profit (in millions)(2):
  U.S. Domestic Package$4,552 $2,749 65.6 %$— $4,552 65.6 %
  International Package3,389 2,372 42.9 %(101)3,288 38.6 %
  Supply Chain Solutions(3)
1,251 727 72.1 %25 1,276 75.5 %
  Total operating profit$9,192 $5,848 57.2 %$(76)$9,116 55.9 %

(1) Amounts adjusted for period over period foreign currency exchange rate and hedging differences

(2) Amounts adjusted for transformation & other

(3) The divestiture of UPS Freight was completed on April 30, 2021.


















Certain prior year amounts have been reclassified to conform to the current year presentation.


United Parcel Service, Inc.
Aircraft Fleet - As of September 30, 2021
(unaudited)
DescriptionOwned and Finance LeasesOperating Leases & Charters from OthersOn OrderUnder Option
Operating:
Boeing 757-20075 — — — 
Boeing 767-30070 — 2 — 
Boeing 767-300BCF4 — — — 
Boeing 767-300BDSF4 — — — 
Airbus A300-60052 — — — 
Boeing MD-1142 — — — 
Boeing 747-400F11 — — — 
Boeing 747-400BCF2 — — — 
Boeing 747-8F24 — 4 — 
Other— 298 — — 
          Total284 298 6 — 

















































Certain prior year amounts have been reclassified to conform to the current year presentation.