UP reports solid first quarter results

The railway increased net income 8.3% to $1.2 billion compared to the first quarter 2014, according to Union Pacific’s latest financial statements.    Union Pacific Corporation in the first quarter 2015 increased revenues 8.3 percent to $1.2 billion compared to the first quarter 2014, according to the company’s latest financial statements. The railway increased diluted earnings per share from $1.19 to $1.30 per diluted share, a 9 percent improvement from the previous year.
   Operating revenues at the company reached $5.6 billion for the quarter, the same as in the first quarter 2014.
   The company’s operating ratio was 64.8 percent, 2.3 points better than the first quarter 2014. UP attributed the improved operating ratio to lower fuel prices, including the lag impact of fuel surcharge. UP said its average quarterly diesel fuel price of $1.95 per gallon was down 38 percent from the previous year.
   Overall volumes at the railway fell 2 percent, due to declines in coal, industrial products, intermodal and chemicals that offset growth in automotive and agricultural products. Revenues from freight decreased 1 percent compared to the first quarter 2014.
   In individual business segments, revenues grew 6 percent in the automotive units, 3 percent in agricultural products, and 1 percent in industrial products. Revenues from coal transportation declined 5 percent, as did intermodal, and revenues from chemicals were remained the same as in the first quarter 2014.
   “Union Pacific achieved 9 percent earnings per share growth in the first quarter, as solid core pricing gains were partially offset by a sharp drop in volume,” Lance Fritz, president and chief executive officer, said of the results. “While we took actions during the quarter to adjust for the volume decline, we did not run an efficient operation. We are taking the steps to align our resources with current demand, while remaining agile in an ever-changing environment.”
   Looking ahead to 2015, Fritz said, “We’ve had some challenges to start off the year, but we’re taking the steps needed to work through those challenges and realize the opportunities we see ahead. We expect to see solid improvement in network performance and cost efficiency over the coming months. As we leverage the strengths of our diverse franchise, we continue to be intently focused on safety, service and shareholder returns.”
   Union Pacific Railroad is the principal operating company of Union Pacific Corporation, connecting 23 states in the western two-thirds of the United States by rail.