01—Abstract
Summary
Summary of the 10-K filed February 5, 2010. Cited figures are marked; the original filing is the authoritative source.
In 2009, Union Pacific Corporation (UNP) navigated a challenging economic environment, achieving its second-highest EPS on record and an all-time low operating ratio of 76.0%a.
Despite a 16%b decrease in volume, the company's focus on productivity, cost control, and disciplined cash management resulted in strong financial performance and improved operational efficiency, including record-high customer satisfaction. The company continued to invest in infrastructure, including preliminary work on Positive Train Control (PTC), and maintained a strong balance sheet.
Looking ahead, Union Pacific anticipates increased business levels as the economy recovers, leveraging its operational efficiencies and expansive network to capitalize on future growth opportunities. The company remains committed to its core strategy of safety, service, and value, with plans for significant capital expenditures in 2010 to support these objectives and maintain its competitive advantage.
02—Key points
Key Highlights
- Achieved an all-time low operating ratio of 76.0% in 2009, demonstrating strong cost control and operational efficiency despite a challenging economic climate.
- Generated $1.9 billion in net income and $3.75 in diluted EPS in 2009, reflecting resilience and effective management.
- Experienced a 16% decrease in freight carloads due to economic conditions but improved average train speed by 16% and car utilization by 8%, enhancing network fluidity.
- Maintained a strong safety record, setting new lows for employee injury incident rates and grade crossing incidents.
- Announced plans for approximately $2.5 billion in capital expenditures for 2010, including significant investment in Positive Train Control (PTC) technology.
- Returned substantial value to shareholders through dividends and stock repurchases in prior years, continuing its commitment to shareholder returns.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2009filed February 5, 2010Financial Statements
FY2009 against FY2008
| Line item | FY2009FY2008 | Change |
|---|---|---|
| Revenue | $14.14B$17.97B | −21.3% |
| Operating Expenses | $10.76B$13.90B | −22.6% |
| Operating Income | $3.38B$4.07B | −17.0% |
| Interest Expense | $600.00M$511.00M | +17.4% |
| Net Income | $1.89B$2.33B | −19.1% |
| EPS (Basic) | $1.88$2.29 | −17.7% |
| EPS (Diluted) | $1.87$2.27 | −17.4% |
| Shares Outstanding (Basic) | 1.01B1.02B | −1.5% |
| Shares Outstanding (Diluted) | 1.01B1.03B | −1.8% |
05—Questions
Frequently Asked Questions
How did Union Pacific perform financially in 2009 given the economic downturn?
Union Pacific demonstrated resilience in 2009, reporting its second-highest EPS on record and an all-time low operating ratio of 76.0%. Despite a 16% volume decline, the company effectively managed costs and improved operational efficiencies, leading to a net income of $1.9 billion.
What are Union Pacific's key operational improvements?
The company achieved significant operational improvements, including a 16% increase in average train speed and an 8% improvement in car utilization. These enhancements, coupled with ongoing network management initiatives, contributed to record-high customer satisfaction levels.
What is Union Pacific's outlook for 2010 and its capital expenditure plans?
Union Pacific anticipates increased volume in 2010 as the economy recovers. The company plans to invest approximately $2.5 billion in capital expenditures, focusing on infrastructure improvements, technology upgrades like Positive Train Control (PTC), and maintaining operational efficiency to support future growth.
How is Union Pacific addressing safety concerns?
Safety remains a top priority. Union Pacific continued its positive trend in safety performance, achieving record lows in employee injury incident rates and grade crossing incidents. This was supported by enhanced employee training, public education, and capital investments in safety technologies.
06—Continue