UPS reported a 133% increase in fourth-quarter net income, thanks mostly to a final settlement of a tax dispute with the Internal Revenue Service and the company's international business operations.
However, UPS said it continues to be hurt by the struggling U.S. economy.
"While we have not seen signs of an economic rebound in the United States, our international business is showing strong growth and our non-package initiatives are paying off," said CFO Scott Davis.
UPS said its U.S. volume decreased 1.3% during the quarter, though it was an improvement over the two previous quarters.
UPS and the IRS recently finalized their tentative settlement of all outstanding tax issues related to excess value package insurance. As a result of the settlement, UPS recorded income, before taxes, of $1.02 billion during the fourth quarter.
The credits and refunds associated with the settlement are expected to occur over the next several years. The company said the IRS settlement and the resolution of several other tax issues has reduced the company's annual tax rate.