July 22 (Bloomberg) -- United Parcel Service Inc., the world's largest package-delivery company, said earnings in the second quarter rose 18 percent as global economic growth raised shipments. The company boosted its 2004 profit forecast.

Net income increased to $818 million, or 72 cents a share, from $692 million, or 61 cents, a year earlier, the Atlanta-based company said in a statement. Revenue climbed 7.8 percent to $8.87 billion from $8.23 billion.

The number of average daily shipments climbed 4.2 percent to 13.6 million. International deliveries rose 8.5 percent, led by a 70 percent jump in shipments from China, the company said, while U.S. shipments rose 3.8 percent. The International Monetary Fund last month reiterated its forecast that the world economy will grow 4.6 percent this year, the fastest pace in four years.

``International continues to be the driving force,'' said Kirk Schmitt, an analyst at Victory Capital Management, which owns 1.25 million United Parcel shares as of March.

United Parcel, the largest U.S. transportation company, said it expects 2004 profit to climb 20 percent from last year's $2.44 a share, which would be about $2.93. United Parcel previously forecast an increase of 12 percent to 18 percent.

The company said third-quarter profit will be 69 cents to 72 cents a share. United Parcel is forecast to earn 72 cents, the average estimate of analysts in a Thomson Financial survey.

In June, United Parcel and FedEx Corp., the biggest overnight-package delivery company, sought U.S. government approval to add cargo flights between the U.S. and China later this year under a new aviation treaty. United Parcel in April won approval to add six weekly flights between Hong Kong and other Asian cities, and bought out its partner in a Japanese joint venture.

To contact the reporter on this story: Mary Schlangenstein in Dallas at maryc.s@bloomberg.net

Last Updated: July 22, 2004 09:01 EDT