The Omaha, Neb.-based company’s operating revenue and business volumes both fell by 2 percent.
Union Pacific Corporation reported on Thursday a 6 percent year-over-year increase in first-quarter profit despite 2 percent drops in both operating revenue and business volumes measured by total revenue carloads.
The Omaha, Neb.-based Class I railroad reported a first-quarter net income of $1.4 billion, or $1.93 per diluted share, which was a 15 percent jump over 2018. Operating revenue fell, however, to $5.4 billion. The diluted earnings per share were better than analysts expected, but the revenue fell below expectations, Reuters reported.
“We delivered record first-quarter financial results driven by improved operating performance, while dealing with significant weather challenges,” said Lance Fritz (pictured above), Union Pacific chairman, president and chief executive officer.
Union Pacific, which operates in 23 western states, also improved its operating ratio by one point to 63.6 percent.
Quarterly freight revenue declined 2 percent to $5.01 billion as “increased fuel surcharge revenue and core pricing gains were offset by lower volumes and negative mix,” the company said.
Energy freight revenue declined 16 percent to $982 million and agricultural product revenue decreased by 3 percent to $1.07 billion. The drops offset the 5 percent industrial freight increase ($1.41 billion) and 3 percent premium freight growth ($1.55 billion).
“We look to build on the momentum we had prior to the weather challenges and provide a consistent, reliable service product for our customers, while at the same time improving our operating efficiency,” Fritz said in the statement.
Union Pacific was the third Class I railroad to report its first-quarter earnings this week, following CSX and Kansas City Southern.