FedEx's recently released First Quarter results seem to indicate a clear end to the boom that has driven the parcel carrier forward over the past five years, as the US slips into period of low or no growth.

At the corporate level FedEx reported revenue up year-on-year 8% at $9.20billion. Both operating and net income were up 4% but operating margin was down 0.4% at 8.8%. FedEx's management attribute this fall in profits to a tougher market for Less than Trailer Load in the US.

The Express business is comparatively buoyant driven by its international business which grew in volume terms by 6%. US traffic however shrank by 1%. FedEx Express as a whole had a revenue of $5.89 billion in the quarter up 4% year-on-year, whilst margins and income both strengthened.

The 'FedEx Ground' business had a strong quarter fuelled by the continued success of its 'Home Delivery' and commercial services. Here revenue jumped 14% with operating income increasing 19% to $190million. Margins have hit 11.7%. The only issue in this otherwise strong business is changes to its supplier network in California, which FedEx insist will not affect costs.

The big problem area of this quarter was the LTL business in FedEx Freight. Revenue was strong over the quarter reporting an increase of 22%, but operating income crashed downwards by 30%, with operating margin almost halving at 8.5% down from 14.8%. This appears to indicate that FedEx is having to cut prices to gain volume in its expanded network, suggesting that it is not just the economy that is responsible for lower profits

The problem of Kinko's has also not been solved with the senior management indicating that they are determined to hold onto the loss making print shop company despite no sign of a turn around in its fortunes.

This time last year FedEx was announcing substantial increases in both revenues and profits across all its business despite higher prices. Such growth appears to have ended. Fred Smith, FedEx's CEO, attributes this to a "sluggish U.S. economy" and is looking to International markets to power growth. However, as the results in the 'Ground' business illustrate, FedEx is vulnerable to any downturn in trade in part due to its aggressive investment in new capacity and it may also be vulnerable to even a modest fall in traffic outside the US.