United Parcel Service Inc. reported an increase in first-quarter revenues as a result of the continued growth of its international and logistics businesses and a smaller increase in its core U.S. air and ground businesses.

For the period ended March 31, with one less working day than in the same period the previous year, revenues totaled $7.5 billion, up 4% compared to the $7.2 billion reported for the same period a year earlier.

However, UPS’s consolidated operating profits declined 11.5% during the period to $944 million. Adjusted net income totaled $582 million or $0.51 per diluted share, down 8.9% compared to the $0.56 per diluted share reported the prior year.

“The economy did slow much faster than we expected and we were not satisfied with our earnings performance,” said Jim Kelly, UPS chairman and CEO. “Given the change in the economy, we are managing now as if these slow conditions will persist.”

Kelly said the company intends to reduce discretionary costs and capital expenditures. Those cuts, however, will not change the company’s strategy of leveraging its core package business to create future opportunities, he said.

UPS’s results do not include non-recurring items that occurred in both quarters. The first quarter of 2001 included a one-time cumulative effect charge on adoption of an accounting standard for derivatives, FAS133, which totaled $26 million after tax, and the first quarter of 2000 included net one-time gains totaling $139 million after tax.