United Parcel Service said it expects profit to rise by 9 to 15 percent this year, with improving profit margins offsetting an uneven global economy.

The world's largest package delivery company on Tuesday said fourth-quarter net income fell to $725 million, or 74 cents a share, from $1.025 billion, or $1.02 a share, a year ago. Its results for the just-ended quarter included a $527 million charge related to a change in how it accounts for pension expenses.

Its shares rose 1.7 percent to $77.45 in premarket trading from a $76.15 close on the New York Stock Exchange.

UPS and No. 2 package delivery company Fed are viewed as economic bellwethers because of the volume of packages they handle.

Fourth-quarter revenue at UPS rose 6 percent to $14.2 billion, compared with the $14.4 billion expected by analysts.

The Atlanta-based company set an initial 2012 profit target of $4.75 to $5 per share for 2012, which would represent 9 percent to 15 percent growth over 2011 levels and at its midpoint is above the $4.80 per share analysts had expected.

The company expects mixed economic growth globally in 2012, with modest improvement to the U.S. economy, said Chief Financial Officer Kurt Kuehn, in a statement.

(Reporting By Lynn Adler, writing by Scott Malone; editing by John Wallace)