Summary
Union Pacific Corporation (UNP) reported a solid third quarter of 2022, with operating revenues increasing 18% year-over-year to $6.57 billion, driven by a 15% rise in average revenue per car (ARC) and a 3% increase in volume. Net income grew to $1.9 billion, or $3.05 per diluted share. The company saw broad-based strength across its commodity groups, particularly in industrial and premium segments, with notable contributions from automotive and coal shipments. Despite increased operating expenses, notably higher fuel costs and a one-time charge related to labor agreements, Union Pacific's operating income still rose 8%. The company continues to invest in infrastructure and capacity expansion, with capital expenditures for the first nine months totaling $2.69 billion. While operational metrics like freight car velocity and train speed showed year-over-year declines due to network congestion, sequential improvements were noted. Management is focused on service recovery and efficiency gains to mitigate inflationary pressures and improve operational performance.
Financial Highlights
48 data points| Revenue | $6.57B |
| Operating Expenses | $3.93B |
| Operating Income | $2.63B |
| Interest Expense | $315.00M |
| Net Income | $1.90B |
| EPS (Basic) | $3.05 |
| EPS (Diluted) | $3.05 |
| Shares Outstanding (Basic) | 620.40M |
| Shares Outstanding (Diluted) | 621.50M |
Key Highlights
- 1Operating revenues increased 18% year-over-year to $6.57 billion in Q3 2022, driven by a 15% increase in average revenue per car (ARC) and 3% volume growth.
- 2Net income for Q3 2022 rose to $1.9 billion, translating to diluted earnings per share (EPS) of $3.05, up from $2.57 in the prior year period.
- 3Operating income increased by 8% to $2.63 billion, despite a 25% increase in total operating expenses, which included higher fuel costs and a $114 million one-time charge for labor agreements.
- 4Capital expenditures for the nine months ended September 30, 2022, increased to $2.69 billion, up from $1.95 billion in the prior year, reflecting investments in infrastructure and growth projects.
- 5The company repurchased approximately $2.1 billion of its common stock in Q3 2022 under its share repurchase program.
- 6Despite some year-over-year deterioration in operational metrics like freight car velocity, sequential improvements were observed, indicating progress in network fluidity.
- 7Union Pacific maintains a strong liquidity position with $1.3 billion in cash and cash equivalents and $2.0 billion in available credit as of September 30, 2022.