Union Pacific Reports Record Second Quarter Results
Second Quarter Diluted Earnings per Share up 37 percent
Omaha, Neb., July 19, 2018
Union Pacific Corporation (NYSE: UNP) today reported 2018 second quarter net income of $1.5 billion, or a second quarter record $1.98 per diluted share. This compares to $1.2 billion, or $1.45 per diluted share, in the second quarter 2017.
Second Quarter Results
- Diluted earnings per share of $1.98 increased 37 percent.
- Operating income totaled $2.1 billion, up 5 percent.
- Operating ratio of 63.0 percent, up 1.1 points (see footnote).
"Overall, I am pleased with the effort put forth by the entire Union Pacific team; however, I recognize the results could have been better," said Lance Fritz, Union Pacific chairman, president and chief executive officer. "Network performance improved significantly coming out of the First Quarter, but a tunnel outage and train-crew shortages created a headwind in June. I am confident we have the right plans in place to drive improvement in our operations and a better service experience for our customers."
Second Quarter Summary
Operating revenue of $5.7 billion was up 8 percent in the second quarter 2018 compared to the second quarter 2017. Second quarter carloads increased 4 percent compared to 2017. Volume increases in industrial and premium more than offset declines in agricultural products and energy. In addition:
- Quarterly freight revenue improved 8 percent compared to the second quarter 2017, as volume growth, increased fuel surcharge revenue, and core pricing gains were partially offset by negative mix of traffic.
- Union Pacific's 63.0 percent operating ratio increased 1.1 points (see footnote) compared to the second quarter 2017.
- The $2.30 per gallon average quarterly diesel fuel price in the second quarter 2018 was 36 percent higher than the second quarter 2017.
- Quarterly train speed, as reported to the Association of American Railroads, was 24.7 mph, 3 percent slower than the second quarter 2017.
- Union Pacific's first half reportable personal injury rate of 0.76 per 200,000 employee hours was flat compared to the first half of 2017.
- The Company repurchased 33.2 million shares in the second quarter 2018, including 19.9 million shares received as part of an accelerated share repurchase program.
Summary of Second Quarter Freight Revenues
- Agricultural Products up 5 percent
- Energy up 5 percent
- Industrial up 8 percent
- Premium up 14 percent
"Looking to the remainder of the year, we expect the strong business environment to continue as we regain our productivity momentum and improve the value proposition for all of our stakeholders," Fritz said.
Footnote 1: Certain prior period amounts have been adjusted for the retrospective adoption of Accounting Standard Update 2017-07 related to the presentation of the components of net periodic pension and other postretirement benefit costs.
Second Quarter 2018 Earnings Conference Call
Union Pacific will host its second quarter 2018 earnings release presentation live over the Internet and via teleconference on Thursday, July 19, 2018 at 8:45 a.m. Eastern Time. The presentation will be webcast live over the internet on Union Pacific's website at www.up.com/investor. Alternatively, the webcast can be accessed directly through the following link. Participants may join the conference call by dialing 877/407-8293 (or for international participants, 201/689-8349).
About Union Pacific
Union Pacific Railroad is the principal operating company of Union Pacific Corporation (NYSE: UNP). One of America's most recognized companies, Union Pacific Railroad connects 23 states in the western two-thirds of the country by rail, providing a critical link in the global supply chain. In the past 10 years, 2008-2017, Union Pacific invested approximately $34 billion in its network and operations to support America's transportation infrastructure. The railroad's diversified business mix includes Agricultural Products, Energy, Industrial and Premium. Union Pacific serves many of the fastest-growing U.S. population centers, operates from all major West Coast and Gulf Coast ports to eastern gateways, connects with Canada's rail systems and is the only railroad serving all six major Mexico gateways. Union Pacific provides value to its roughly 10,000 customers by delivering products in a safe, reliable, fuel-efficient and environmentally responsible manner.
Union Pacific Investor contact: Mike Staffenbeal at 402-544-4227 or firstname.lastname@example.org
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