OMAHA, Neb., Jan. 22, 2015 /PRNewswire/ --
All-Time Quarterly Records
- Diluted earnings per share of $1.61 improved 27 percent.
- Operating income totaled $2.4 billion, up 20 percent.
- Operating ratio of 61.4 percent improved 3.6 points.
Full Year Records
- Diluted earnings per share of $5.75 improved 22 percent.
- Operating revenues totaled $24.0 billion, up 9 percent.
- Operating income totaled $8.8 billion, up 18 percent.
- Operating ratio of 63.5 percent improved 2.6 points.
Union Pacific Corporation (NYSE: UNP) today reported 2014 fourth quarter net income of $1.4 billion, or $1.61 per diluted share, compared to $1.2 billion, or $1.27 per diluted share, in the fourth quarter 2013.
"Union Pacific achieved record quarterly financial results, driven by strong volumes, solid core pricing and productivity gains," said Jack Koraleski, Union Pacific chief executive officer. "Robust volumes challenged our network for much of the year, and we remained focused on adding the necessary resources to safely improve service. We are encouraged with the progress we are making."
Fourth Quarter Summary
Operating revenue increased in the fourth quarter 2014 to $6.2 billion, a 9 percent increase over fourth quarter 2013. Fourth quarter business volumes, as measured by total revenue carloads, increased 6 percent compared to 2013. Volume increased in all business groups – led by growth in industrial products and coal. In addition:
- Quarterly freight revenue increased 9 percent compared to the fourth quarter 2013, driven by volume growth and core pricing gains.
- The average quarterly diesel fuel price of $2.66 per gallon in the fourth quarter 2014 was down 14 percent compared to the fourth quarter 2013.
- Union Pacific's operating ratio of 61.4 percent was an all-time quarterly record, 3.6 points better than the fourth quarter 2013. The net impact of lower fuel prices contributed about 1.5 points of this improvement.
- Quarterly train speed, as reported to the Association of American Railroads, was 23.8 mph, 8 percent slower than the fourth quarter 2013.
- The Company repurchased more than 7.7 million shares in the fourth quarter 2014 at an average share price of $113.77 and an aggregate cost of $880 million.
Summary of Fourth Quarter Freight Revenues
- Industrial Products up 15 percent
- Intermodal up 11 percent
- Coal up 9 percent
- Agricultural Products up 9 percent
- Chemicals up 8 percent
- Automotive flat
2014 Full Year Summary
For the full year 2014, Union Pacific reported net income of $5.2 billion or $5.75 per diluted share. This compares to $4.4 billion or $4.71 per diluted share in 2013, 18 and 22 percent increases, respectively. Operating revenue totaled a record $24.0 billion versus $22.0 billion in 2013. Operating income totaled $8.8 billion, an 18 percent increase over 2013. In addition:
- Freight revenue increased to $22.6 billion, a 9 percent increase over 2013. Carloadings were up 7 percent versus 2013, with growth in each business group. Volume growth was led by agricultural products, industrial products, and intermodal.
- Average diesel fuel prices decreased 6 percent to $2.97 per gallon in 2014 from $3.15 per gallon in 2013.
- Union Pacific's operating ratio of 63.5 percent was a full year record, improving 2.6 points from the previous record set in 2013.
- Train speed, as reported to the Association of American Railroads, was 24.0 mph, 8 percent slower compared to the full year 2013.
- Union Pacific's capital program in 2014 totaled $4.1 billion, an increase of approximately $500 million compared to the full year 2013.
- The Company increased its quarterly declared dividend per share by 10 percent to $0.50 cents per share in the third quarter 2014. Total dividends declared for the full year 2014 grew 29 percent compared to the full year 2013.
- The Company repurchased more than 32.0 million shares in 2014 at an average share price of $100.65, and an aggregate cost of more than $3.2 billion.
2015 Outlook
"With 2014 behind us, we're intently focused on the year ahead," Koraleski said. "Overall, the U.S. economy continues to move forward at a moderate pace, but of course, there are always uncertainties. Clearly, one of the biggest uncertainties is the outlook for energy markets, which will bring both challenges and opportunities as we move ahead. We're entering the year well-resourced and we're looking forward to safely providing efficient, value-added service for our customers, and increasing returns for our shareholders in 2015."
About Union Pacific
Union Pacific Railroad is the principal operating company of Union Pacific Corporation (NYSE: UNP). One of America's most recognized companies, Union Pacific Railroad connects 23 states in the western two-thirds of the country by rail, providing a critical link in the global supply chain. From 2005-2014, Union Pacific invested more than $31 billion in its network and operations to support America's transportation infrastructure. The railroad's diversified business mix includes Agricultural Products, Automotive, Chemicals, Coal, Industrial Products and Intermodal. Union Pacific serves many of the fastest-growing U.S. population centers, operates from all major West Coast and Gulf Coast ports to eastern gateways, connects with Canada's rail systems and is the only railroad serving all six major Mexico gateways. Union Pacific provides value to its roughly 10,000 customers by delivering products in a safe, reliable, fuel-efficient and environmentally responsible manner.
Investor contact is Mike Staffenbeal, (402) 544-4227.
Media contact is Aaron Hunt, (402) 544-0100.
Supplemental financial information is attached.
This presentation and related materials contain statements about the Corporation's future that are not statements of historical fact, including specifically the statements regarding the Corporation's expectations with respect to economic conditions; and its ability to generate financial returns, improve network performance, provide quality customer service, and provide returns to its shareholders. These statements are, or will be, forward-looking statements as defined by the Securities Act of 1933 and the Securities Exchange Act of 1934. Forward-looking statements also generally include, without limitation, information or statements regarding: projections, predictions, expectations, estimates or forecasts as to the Corporation's and its subsidiaries' business, financial, and operational results, and future economic performance; and management's beliefs, expectations, goals, and objectives and other similar expressions concerning matters that are not historical facts.
Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times that, or by which, such performance or results will be achieved. Forward-looking information, including expectations regarding operational and financial improvements and the Corporation's future performance or results are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statement. Important factors, including risk factors, could affect the Corporation's and its subsidiaries' future results and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements. Information regarding risk factors and other cautionary information are available in the Corporation's Annual Report on Form 10-K for 2013, which was filed with the SEC on February 7, 2014. The Corporation updates information regarding risk factors if circumstances require such updates in its periodic reports on Form 10-Q and its subsequent Annual Reports on Form 10-K (or such other reports that may be filed with the SEC).
Forward-looking statements speak only as of, and are based only upon information available on, the date the statements were made. The Corporation assumes no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. If the Corporation does update one or more forward-looking statements, no inference should be drawn that the Corporation will make additional updates with respect thereto or with respect to other forward-looking statements. References to our website are provided for convenience and, therefore, information on or available through the website is not, and should not be deemed to be, incorporated by reference herein.
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES |
||||||||||||||
Condensed Consolidated Statements of Income (unaudited) |
||||||||||||||
Millions, Except Per Share Amounts and Percentages, |
4th Quarter |
Full Year |
||||||||||||
For the Periods Ended December 31, |
2014 |
2013 |
% |
2014 |
2013 |
% |
||||||||
Operating Revenues |
||||||||||||||
Freight revenues |
$ |
5,794 |
$ |
5,297 |
9% |
$ |
22,560 |
$ |
20,684 |
9% |
||||
Other revenues |
359 |
333 |
8 |
1,428 |
1,279 |
12 |
||||||||
Total operating revenues |
6,153 |
5,630 |
9 |
23,988 |
21,963 |
9 |
||||||||
Operating Expenses |
||||||||||||||
Compensation and benefits |
1,289 |
1,210 |
7 |
5,076 |
4,807 |
6 |
||||||||
Fuel |
813 |
905 |
(10) |
3,539 |
3,534 |
- |
||||||||
Purchased services and materials |
665 |
585 |
14 |
2,558 |
2,315 |
10 |
||||||||
Depreciation |
489 |
458 |
7 |
1,904 |
1,777 |
7 |
||||||||
Equipment and other rents |
296 |
311 |
(5) |
1,234 |
1,235 |
- |
||||||||
Other |
228 |
188 |
21 |
924 |
849 |
9 |
||||||||
Total operating expenses |
3,780 |
3,657 |
3 |
15,235 |
14,517 |
5 |
||||||||
Operating Income |
2,373 |
1,973 |
20 |
8,753 |
7,446 |
18 |
||||||||
Other income |
71 |
37 |
92 |
151 |
128 |
18 |
||||||||
Interest expense |
(146) |
(127) |
15 |
(561) |
(526) |
7 |
||||||||
Income before income taxes |
2,298 |
1,883 |
22 |
8,343 |
7,048 |
18 |
||||||||
Income taxes |
(867) |
(709) |
22 |
(3,163) |
(2,660) |
19 |
||||||||
Net Income |
$ |
1,431 |
$ |
1,174 |
22% |
$ |
5,180 |
$ |
4,388 |
18% |
||||
Share and Per Share* |
||||||||||||||
Earnings per share - basic |
$ |
1.62 |
$ |
1.28 |
27% |
$ |
5.77 |
$ |
4.74 |
22% |
||||
Earnings per share - diluted |
$ |
1.61 |
$ |
1.27 |
27 |
$ |
5.75 |
$ |
4.71 |
22 |
||||
Weighted average number of shares - basic |
885.7 |
916.2 |
(3) |
897.1 |
926.5 |
(3) |
||||||||
Weighted average number of shares - diluted |
889.8 |
921.4 |
(3) |
901.1 |
931.5 |
(3) |
||||||||
Dividends declared per share |
$ |
0.50 |
$ |
0.395 |
27 |
$ |
1.91 |
$ |
1.48 |
29 |
||||
Operating Ratio |
61.4% |
65.0% |
(3.6) |
pts |
63.5% |
66.1% |
(2.6) |
pts |
||||||
Effective Tax Rate |
37.7% |
37.7% |
- |
pts |
37.9% |
37.7% |
0.2 |
pts |
* |
On June 6, 2014, we completed a two-for-one stock split, effected in the form of a 100% stock dividend. All references to common shares and per share amounts have been retroactively adjusted to reflect the stock split for all periods presented. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES |
|||||||||||||
Freight Revenues Statistics (unaudited) |
|||||||||||||
4th Quarter |
Full Year |
||||||||||||
For the Periods Ended December 31, |
2014 |
2013 |
% |
2014 |
2013 |
% |
|||||||
Freight Revenues (Millions) |
|||||||||||||
Agricultural Products |
$ |
1,018 |
$ |
937 |
9% |
$ |
3,777 |
$ |
3,276 |
15% |
|||
Automotive |
543 |
544 |
- |
2,103 |
2,077 |
1 |
|||||||
Chemicals |
922 |
855 |
8 |
3,664 |
3,501 |
5 |
|||||||
Coal |
1,078 |
985 |
9 |
4,127 |
3,978 |
4 |
|||||||
Industrial Products |
1,098 |
954 |
15 |
4,400 |
3,822 |
15 |
|||||||
Intermodal |
1,135 |
1,022 |
11 |
4,489 |
4,030 |
11 |
|||||||
Total |
$ |
5,794 |
$ |
5,297 |
9% |
$ |
22,560 |
$ |
20,684 |
9% |
|||
Revenue Carloads (Thousands) |
|||||||||||||
Agricultural Products |
252 |
243 |
4% |
973 |
874 |
11% |
|||||||
Automotive |
209 |
205 |
2 |
809 |
781 |
4 |
|||||||
Chemicals |
275 |
263 |
5 |
1,116 |
1,103 |
1 |
|||||||
Coal |
455 |
419 |
9 |
1,768 |
1,703 |
4 |
|||||||
Industrial Products |
335 |
305 |
10 |
1,368 |
1,236 |
11 |
|||||||
Intermodal * |
898 |
845 |
6 |
3,591 |
3,325 |
8 |
|||||||
Total |
2,424 |
2,280 |
6% |
9,625 |
9,022 |
7% |
|||||||
Average Revenue per Car |
|||||||||||||
Agricultural Products |
$ |
4,031 |
$ |
3,846 |
5% |
$ |
3,881 |
$ |
3,746 |
4% |
|||
Automotive |
2,607 |
2,653 |
(2) |
2,602 |
2,659 |
(2) |
|||||||
Chemicals |
3,344 |
3,255 |
3 |
3,282 |
3,176 |
3 |
|||||||
Coal |
2,366 |
2,352 |
1 |
2,334 |
2,336 |
- |
|||||||
Industrial Products |
3,283 |
3,134 |
5 |
3,217 |
3,093 |
4 |
|||||||
Intermodal * |
1,265 |
1,208 |
5 |
1,250 |
1,212 |
3 |
|||||||
Average |
$ |
2,390 |
$ |
2,323 |
3% |
$ |
2,344 |
$ |
2,293 |
2% |
* Each intermodal container or trailer equals one carload. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES |
|||||
Condensed Consolidated Statements of Financial Position (unaudited) |
|||||
Dec. 31, |
Dec. 31, |
||||
Millions, Except Percentages |
2014 |
2013 |
|||
Assets |
|||||
Cash and cash equivalents |
$ |
1,586 |
$ |
1,432 |
|
Other current assets |
3,093 |
2,558 |
|||
Investments |
1,390 |
1,321 |
|||
Net properties |
46,272 |
43,749 |
|||
Other assets |
375 |
671 |
|||
Total assets |
$ |
52,716 |
$ |
49,731 |
|
Liabilities and Common Shareholders' Equity |
|||||
Debt due within one year |
$ |
462 |
$ |
705 |
|
Other current liabilities |
3,303 |
3,086 |
|||
Debt due after one year |
11,018 |
8,872 |
|||
Deferred income taxes |
14,680 |
14,163 |
|||
Other long-term liabilities |
2,064 |
1,680 |
|||
Total liabilities |
31,527 |
28,506 |
|||
Total common shareholders' equity |
21,189 |
21,225 |
|||
Total liabilities and common shareholders' equity |
$ |
52,716 |
$ |
49,731 |
|
Debt to Capital |
35.1% |
31.1% |
|||
Adjusted Debt to Capital* |
41.3% |
37.6% |
|||
Return on Invested Capital* |
16.2% |
14.7% |
* |
Adjusted Debt to Capital and Return on Invested Capital are non-GAAP measures; however, we believe that they are important in evaluating our financial performance. See pages 8 and 9 for a reconciliation to GAAP. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES |
||||||
Condensed Consolidated Statements of Cash Flows (unaudited) |
||||||
Millions, |
Full Year |
|||||
For the Periods Ended December 31, |
2014 |
2013 |
||||
Operating Activities |
||||||
Net income |
$ |
5,180 |
$ |
4,388 |
||
Depreciation |
1,904 |
1,777 |
||||
Deferred income taxes |
895 |
723 |
||||
Other - net |
(594) |
(65) |
||||
Cash provided by operating activities |
7,385 |
6,823 |
||||
Investing Activities |
||||||
Capital investments |
(4,346) |
(3,496) |
||||
Other - net |
97 |
91 |
||||
Cash used in investing activities |
(4,249) |
(3,405) |
||||
Financing Activities |
||||||
Common shares repurchased |
(3,225) |
(2,218) |
||||
Debt issued |
2,588 |
1,443 |
||||
Dividends paid |
(1,632) |
(1,333) |
||||
Debt repaid |
(710) |
(640) |
||||
Debt exchange |
- |
(289) |
||||
Other - net |
(3) |
(12) |
||||
Cash used in financing activities |
(2,982) |
(3,049) |
||||
Net Change in Cash and Cash Equivalents |
154 |
369 |
||||
Cash and cash equivalents at beginning of year |
1,432 |
1,063 |
||||
Cash and Cash Equivalents End of Period |
$ |
1,586 |
$ |
1,432 |
||
Free Cash Flow* |
||||||
Cash provided by operating activities |
$ |
7,385 |
$ |
6,823 |
||
Cash used in investing activities |
(4,249) |
(3,405) |
||||
Dividends paid |
(1,632) |
(1,333) |
||||
Free cash flow |
$ |
1,504 |
$ |
2,085 |
* |
Free cash flow is a non-GAAP measure; however, management believes that it is an important measure in evaluating our financial performance and measures our ability to generate cash without additional external financing. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES |
|||||||||||
Operating and Performance Statistics (unaudited) |
|||||||||||
4th Quarter |
Full Year |
||||||||||
For the Periods Ended December 31, |
2014 |
2013 |
% |
2014 |
2013 |
% |
|||||
Operating/Performance Statistics |
|||||||||||
Gross ton-miles (GTMs) (millions) |
262,267 |
244,631 |
7% |
1,014,905 |
949,065 |
7% |
|||||
Employees (average) |
48,037 |
45,951 |
5 |
47,201 |
46,445 |
2 |
|||||
GTMs (millions) per employee |
5.46 |
5.32 |
3 |
21.50 |
20.43 |
5 |
|||||
Locomotive Fuel Statistics |
|||||||||||
Average fuel price per gallon consumed |
$ 2.66 |
$ 3.11 |
(14)% |
$ 2.97 |
$ 3.15 |
(6)% |
|||||
Fuel consumed in gallons (millions) |
298 |
283 |
5 |
1,158 |
1,091 |
6 |
|||||
Fuel consumption rate * |
1.135 |
1.157 |
(2) |
1.141 |
1.149 |
(1) |
|||||
AAR Reported Performance Measures |
|||||||||||
Average train speed (miles per hour) |
23.8 |
25.8 |
(8)% |
24.0 |
26.0 |
(8)% |
|||||
Average terminal dwell time (hours) |
31.0 |
28.0 |
11 |
30.3 |
27.1 |
12 |
|||||
Revenue Ton-Miles (Millions) |
|||||||||||
Agricultural Products |
24,910 |
24,197 |
3% |
94,273 |
80,904 |
17% |
|||||
Automotive |
4,316 |
4,238 |
2 |
16,797 |
16,169 |
4 |
|||||
Chemicals |
18,696 |
17,752 |
5 |
75,519 |
73,963 |
2 |
|||||
Coal |
50,443 |
45,865 |
10 |
191,359 |
186,902 |
2 |
|||||
Industrial Products |
22,178 |
19,523 |
14 |
88,054 |
77,760 |
13 |
|||||
Intermodal |
21,175 |
20,037 |
6 |
83,627 |
78,574 |
6 |
|||||
Total |
141,718 |
131,612 |
8% |
549,629 |
514,272 |
7% |
* |
Fuel consumption is computed as follows: gallons of fuel consumed divided by gross ton-miles in thousands. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES |
|||||||||||||||
Condensed Consolidated Statements of Income (unaudited) |
|||||||||||||||
2014 |
|||||||||||||||
Millions, Except Per Share Amounts and Percentages |
1st Qtr |
2nd Qtr |
3rd Qtr |
4th Qtr |
Full Year |
||||||||||
Operating Revenues |
|||||||||||||||
Freight revenues |
$ |
5,286 |
$ |
5,661 |
$ |
5,819 |
$ |
5,794 |
$ |
22,560 |
|||||
Other revenues |
352 |
354 |
363 |
359 |
1,428 |
||||||||||
Total operating revenues |
5,638 |
6,015 |
6,182 |
6,153 |
23,988 |
||||||||||
Operating Expenses |
|||||||||||||||
Compensation and benefits |
1,254 |
1,246 |
1,287 |
1,289 |
5,076 |
||||||||||
Fuel |
921 |
923 |
882 |
813 |
3,539 |
||||||||||
Purchased services and materials |
607 |
636 |
650 |
665 |
2,558 |
||||||||||
Depreciation |
464 |
470 |
481 |
489 |
1,904 |
||||||||||
Equipment and other rents |
312 |
316 |
310 |
296 |
1,234 |
||||||||||
Other |
226 |
228 |
242 |
228 |
924 |
||||||||||
Total operating expenses |
3,784 |
3,819 |
3,852 |
3,780 |
15,235 |
||||||||||
Operating Income |
1,854 |
2,196 |
2,330 |
2,373 |
8,753 |
||||||||||
Other income |
38 |
22 |
20 |
71 |
151 |
||||||||||
Interest expense |
(133) |
(138) |
(144) |
(146) |
(561) |
||||||||||
Income before income taxes |
1,759 |
2,080 |
2,206 |
2,298 |
8,343 |
||||||||||
Income tax expense |
(671) |
(789) |
(836) |
(867) |
(3,163) |
||||||||||
Net Income |
$ |
1,088 |
$ |
1,291 |
$ |
1,370 |
$ |
1,431 |
$ |
5,180 |
|||||
Share and Per Share* |
|||||||||||||||
Earnings per share - basic |
$ |
1.20 |
$ |
1.43 |
$ |
1.53 |
$ |
1.62 |
$ |
5.77 |
|||||
Earnings per share - diluted |
$ |
1.19 |
$ |
1.43 |
$ |
1.53 |
$ |
1.61 |
$ |
5.75 |
|||||
Weighted average number of shares - basic |
908.1 |
901.5 |
893.2 |
885.7 |
897.1 |
||||||||||
Weighted average number of shares - diluted |
912.5 |
905.0 |
896.9 |
889.8 |
901.1 |
||||||||||
Dividends declared per share |
$ |
0.455 |
$ |
0.455 |
$ |
0.50 |
$ |
0.50 |
$ |
1.91 |
|||||
Operating Ratio |
67.1% |
63.5% |
62.3% |
61.4% |
63.5% |
||||||||||
Effective Tax Rate |
38.1% |
37.9% |
37.9% |
37.7% |
37.9% |
* |
On June 6, 2014, we completed a two-for-one stock split, effected in the form of a 100% stock dividend. All references to common shares and per share amounts have been retroactively adjusted to reflect the stock split for all periods presented. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES |
||||||||||||||
Freight Revenues Statistics (unaudited) |
||||||||||||||
2014 |
||||||||||||||
1st Qtr |
2nd Qtr |
3rd Qtr |
4th Qtr |
Full Year |
||||||||||
Freight Revenues (Millions) |
||||||||||||||
Agricultural Products |
$ |
910 |
$ |
934 |
$ |
915 |
$ |
1,018 |
$ |
3,777 |
||||
Automotive |
488 |
545 |
527 |
543 |
2,103 |
|||||||||
Chemicals |
893 |
913 |
936 |
922 |
3,664 |
|||||||||
Coal |
961 |
989 |
1,099 |
1,078 |
4,127 |
|||||||||
Industrial Products |
1,011 |
1,130 |
1,161 |
1,098 |
4,400 |
|||||||||
Intermodal |
1,023 |
1,150 |
1,181 |
1,135 |
4,489 |
|||||||||
Total |
$ |
5,286 |
$ |
5,661 |
$ |
5,819 |
$ |
5,794 |
$ |
22,560 |
||||
Revenue Carloads (Thousands) |
||||||||||||||
Agricultural Products |
239 |
243 |
239 |
252 |
973 |
|||||||||
Automotive |
188 |
208 |
204 |
209 |
809 |
|||||||||
Chemicals |
270 |
283 |
288 |
275 |
1,116 |
|||||||||
Coal |
430 |
417 |
466 |
455 |
1,768 |
|||||||||
Industrial Products |
314 |
356 |
363 |
335 |
1,368 |
|||||||||
Intermodal * |
833 |
924 |
936 |
898 |
3,591 |
|||||||||
Total |
2,274 |
2,431 |
2,496 |
2,424 |
9,625 |
|||||||||
Average Revenue per Car |
||||||||||||||
Agricultural Products |
$ |
3,815 |
$ |
3,833 |
$ |
3,836 |
$ |
4,031 |
$ |
3,881 |
||||
Automotive |
2,591 |
2,619 |
2,590 |
2,607 |
2,602 |
|||||||||
Chemicals |
3,307 |
3,230 |
3,249 |
3,344 |
3,282 |
|||||||||
Coal |
2,236 |
2,369 |
2,362 |
2,366 |
2,334 |
|||||||||
Industrial Products |
3,218 |
3,175 |
3,195 |
3,283 |
3,217 |
|||||||||
Intermodal * |
1,227 |
1,246 |
1,260 |
1,265 |
1,250 |
|||||||||
Average |
$ |
2,324 |
$ |
2,329 |
$ |
2,331 |
$ |
2,390 |
$ |
2,344 |
* Each intermodal container or trailer equals one carload. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES |
|||||
Non-GAAP Measures Reconciliation to GAAP |
|||||
Debt to Capital* |
|||||
Dec. 31, |
Dec. 31, |
||||
Millions, Except Percentages |
2014 |
2013 |
|||
Debt (a) |
$ |
11,480 |
$ |
9,577 |
|
Equity |
21,189 |
21,225 |
|||
Capital (b) |
$ |
32,669 |
$ |
30,802 |
|
Debt to capital (a/b) |
35.1% |
31.1% |
* |
Total debt divided by total debt plus equity. Management believes this is an important measure in evaluating our balance sheet strength and is important in managing our credit ratios and financing relationships. |
Adjusted Debt to Capital, Reconciliation to GAAP* |
|||||
Dec. 31, |
Dec. 31, |
||||
Millions, Except Percentages |
2014 |
2013 |
|||
Debt |
$ |
11,480 |
$ |
9,577 |
|
Net present value of operating leases |
2,902 |
3,057 |
|||
Unfunded pension and OPEB |
523 |
170 |
|||
Adjusted debt (a) |
$ |
14,905 |
$ |
12,804 |
|
Equity |
21,189 |
21,225 |
|||
Adjusted capital (b) |
$ |
36,094 |
$ |
34,029 |
|
Adjusted debt to capital (a/b) |
41.3% |
37.6% |
* |
Total debt plus net present value of operating leases plus after-tax unfunded pension and OPEB obligation divided by total debt plus net present value of operating leases plus after-tax unfunded pension and OPEB obligation plus equity. Operating leases were discounted using 5.3% at December 31, 2014 and 5.7% at December 31, 2013. The discount rate reflects our effective interest rate. Management believes this is an important measure to management and investors in evaluating the total amount of leverage in our capital structure including off-balance sheet obligations. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES |
|||||
Non-GAAP Measures Reconciliation to GAAP |
|||||
Return on Invested Capital as Adjusted (ROIC)* |
|||||
Dec. 31, |
Dec. 31, |
||||
Millions, Except Percentages |
2014 |
2013 |
|||
Net income |
$ |
5,180 |
$ |
4,388 |
|
Interest expense |
561 |
526 |
|||
Interest on present value of operating leases |
158 |
175 |
|||
Taxes on interest |
(273) |
(264) |
|||
Net operating profit after taxes as adjusted (a) |
$ |
5,626 |
$ |
4,825 |
|
Average equity |
$ |
21,207 |
$ |
20,551 |
|
Average debt |
10,529 |
9,287 |
|||
Average present value of operating leases |
2,980 |
3,077 |
|||
Average invested capital as adjusted (b) |
$ |
34,716 |
$ |
32,915 |
|
Return on invested capital as adjusted (a/b) |
16.2% |
14.7% |
* |
ROIC is considered a non-GAAP financial measure by SEC Regulation G and Item 10 of SEC Regulation S-K, and may not be defined and calculated by other companies in the same manner. We believe this measure is important in evaluating the efficiency and effectiveness of the Corporation's long-term capital investments, and we currently use ROIC as a performance criteria in determining certain elements of equity compensation for our executives. ROIC should be considered in addition to, rather than as a substitute for, other information provided in accordance with GAAP. The most comparable GAAP measure is Return on Average Common Shareholders' Equity. |
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SOURCE Union Pacific Corporation
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