Originally Posted by threeighteen;[url=tel:3557345
3557345[/url]]The difference between UPS and FedEx margins is partly the mismanagement of ground but more so a story of massive CAPEX, stock buybacks, etc occurring at FedEx that is not occurring at UPS. Take away the stock buybacks and the CAPEX and the margin looks a lot better.
I just went back 7 years worth
of CAPEX data. Very similar levels. Some higher, some lower but very similar.
Oh, and the definition of how CAPEX plays into EBITDA (profit and loss statement):
Capital expenditures relate to the purchase of physical assets/equipment for the business. The cost is capitalized into PP&E and then depreciated over the useful life of the asset. Since depreciation expenses are added back to the net income to calculate EBITDA, capital expenses are excluded.
So no, CAPEX has nothing to do with margins. Same with stock buy backs. Has to do with cash flow.