Summary
Union Pacific Corporation (UNP) reported a strong third quarter and nine-month performance ending September 30, 2011, with record earnings per diluted share. Total operating revenues saw a significant increase of 16% in the third quarter and 15% year-to-date compared to the prior year, driven primarily by robust freight revenue growth across most commodity groups. This growth was fueled by higher fuel surcharges, core pricing gains, and modest volume increases. Despite inflationary pressures, weather-related disruptions in the Southern Region impacting operating expenses, and increased fuel costs, the company demonstrated operational efficiency and effective cost management. Financially, UNP maintained a solid balance sheet with total assets growing to $45.1 billion and total shareholders' equity increasing to $18.6 billion. Cash flow from operations remained strong, enabling significant capital investments in infrastructure and equipment. The company also actively managed its capital structure through debt issuances and share repurchases, signaling confidence in its financial health and commitment to returning value to shareholders. Investors should note the ongoing investments in infrastructure and the management's proactive approach to mitigating operational challenges.
Financial Highlights
47 data points| Revenue | $5.10B |
| Operating Expenses | $3.52B |
| Operating Income | $1.58B |
| Interest Expense | $142.00M |
| Net Income | $904.00M |
| EPS (Basic) | $0.94 |
| EPS (Diluted) | $0.93 |
| Shares Outstanding (Basic) | 968.40M |
| Shares Outstanding (Diluted) | 976.20M |
Key Highlights
- 1Total operating revenues increased by 16% to $5.1 billion for the third quarter and 15% to $14.4 billion for the nine months ended September 30, 2011, compared to the prior year.
- 2Net income rose to $904 million ($1.85 per diluted share) for the third quarter and $2.3 billion ($4.74 per diluted share) for the nine months, representing significant year-over-year growth.
- 3Freight revenues grew by 16% and 15% for the respective periods, driven by strong Average Revenue per Car (ARC) increases of 14% and 12%, attributed to fuel surcharges and core pricing.
- 4Operating expenses increased by 17% in Q3 and 16% year-to-date, largely due to a 51% jump in fuel costs and a 9% increase in compensation and benefits.
- 5The company made substantial capital investments totaling $2.2 billion in the nine-month period, primarily in road infrastructure replacements, locomotives, and freight cars.
- 6Union Pacific generated strong operating cash flow of $4.3 billion for the nine months, supporting investments and financing activities, including share repurchases and dividend payments.
- 7Despite operational challenges from extreme weather, the company maintained its commitment to growth and financial discipline, with an operating ratio of 69.1% for Q3 and 71.6% year-to-date.