Summary
Union Pacific Corporation (UNP) reported its second-quarter 2019 financial results, showing a slight decrease in total operating revenues to $5.6 billion compared to $5.7 billion in the prior year period. Net income for the quarter rose to $1.57 billion, or $2.22 per diluted share, an increase from $1.51 billion, or $1.98 per diluted share, in the second quarter of 2018. This improvement in profitability was driven by effective cost management, including productivity savings, lower fuel prices, and a notable employment tax refund, which more than offset a 2% decline in freight revenues primarily due to a 4% decrease in volume. The company highlighted progress in its 'Unified Plan 2020' initiative, which focuses on operational efficiency and reliability, leading to improvements in locomotive, freight car, and workforce productivity despite facing challenges from widespread flooding. Financially, UNP demonstrated a strong operating ratio of 59.6%, an all-time quarterly record, indicating robust cost control. The company also continued its commitment to shareholder returns through share repurchases and dividend payments. Investments in capital expenditures were approximately $1.56 billion for the first six months of the year, primarily focused on infrastructure replacements and capacity expansion. The company reaffirmed its expectation for full-year 2019 capital expenditures to be around $3.2 billion.
Financial Highlights
47 data points| Revenue | $5.60B |
| Operating Expenses | $3.34B |
| Operating Income | $2.26B |
| Interest Expense | $259.00M |
| Net Income | $1.57B |
| EPS (Basic) | $2.23 |
| EPS (Diluted) | $2.22 |
| Shares Outstanding (Basic) | 705.50M |
| Shares Outstanding (Diluted) | 708.00M |
Key Highlights
- 1Total operating revenues for Q2 2019 decreased slightly to $5.6 billion from $5.7 billion in Q2 2018.
- 2Net income increased to $1.57 billion ($2.22/share) in Q2 2019 from $1.51 billion ($1.98/share) in Q2 2018.
- 3Freight revenues declined by 2% driven by a 4% volume decrease, partially offset by a 3% increase in average revenue per car (ARC).
- 4Operating expenses decreased by 7% in Q2 2019 due to productivity savings, lower fuel prices, and an employment tax refund, leading to an improved operating ratio of 59.6% (an all-time quarterly record).
- 5Significant progress was made on the 'Unified Plan 2020' initiative, showing improvements in locomotive, freight car, and workforce productivity.
- 6Capital expenditures for the first six months of 2019 were $1.56 billion, with full-year 2019 capital expenditure guidance of approximately $3.2 billion.
- 7The company repurchased $3.6 billion in shares in the first half of 2019, and a new authorization for up to 150 million shares was approved.