Union Pacific Reports Third Quarter 2022 Results
- Adjusted earnings per diluted share of $3.19
- Operating revenue up 18%
- Adjusted operating income up 13%
OMAHA, Neb., Oct. 20, 2022 /PRNewswire/ -- Union Pacific Corporation (NYSE: UNP) today reported 2022 third quarter net income of $1.9 billion, or $3.05 per diluted share. These results include a $114 million charge for a change to prior period accounting estimates related to new, tentative and ratified labor agreements. Excluding the effects of that charge, adjusted third quarter net income was $2.0 billion, or $3.19 per diluted share. This compares to 2021 third quarter net income of $1.7 billion, or $2.57 per diluted share.
"We made positive strides in the third quarter to increase network fluidity and better meet customer demand," said Lance Fritz, Union Pacific chairman, president, and chief executive officer. "Inflationary pressures and operational inefficiencies continued to challenge us. We reported strong revenue and operating income growth in the quarter through increased fuel surcharge revenue, volume gains, and solid core pricing. As we close out 2022, we will maintain strong price discipline while improving efficiency and service to capitalize on the available demand."
Financial Results: Topline Growth Produces Quarterly Records for Operating Revenue, Operating Income, Net Income, and Earnings Per Share
Third Quarter 2022 Compared to Third Quarter 2021
- Operating revenue of $6.6 billion was up 18% driven by higher fuel surcharge revenue, volume growth, and core pricing gains.
- Business volumes, as measured by total revenue carloads, were up 3%.
- Union Pacific's reported operating ratio was 59.9%. Excluding the charge, the adjusted operating ratio of 58.2% deteriorated by 190 basis points. Lower fuel prices positively impacted the operating ratio by 70 basis points.
- Adjusted operating income of $2.7 billion was up 13%.
- The company repurchased 9.5 million shares in third quarter 2022 at an aggregate cost of $2.1 billion.
Operating Performance: Service and Efficiency Measures Improve Sequentially but Lag Prior Year Results; Quarterly Record for Fuel Consumption Rate
Third Quarter 2022 Compared to Third Quarter 2021
- Quarterly freight car velocity was 191 daily miles per car, a 2% decline.
- Quarterly locomotive productivity was 124 gross ton-miles (GTMs) per horsepower day, a 2% decline.
- Average maximum train length increased 1% to 9,483 feet.
- Quarterly workforce productivity of 1,045 car miles per employee was flat.
- Fuel consumption rate of 1.056, measured in gallons of fuel per thousand GTMs, improved 1%.
- Union Pacific's year-to-date reportable personal injury rate improved 20% to 0.80 per 200,000 employee-hours compared to 1.00 for year-to-date 2021.
2022 Guidance: Update Reflects Challenging Year
Updated
- Full year carload growth ~3%
- Full year reported operating ratio around 60%
- Capital spending of $3.4 billion
- Full year share repurchases of $6.5 billion
Affirmed
- Pricing gains in excess of inflation dollars
- Long term dividend payout target of 45% of earnings
Third Quarter 2022 Earnings Conference Call
Union Pacific will webcast its third quarter 2022 earnings release presentation live at www.up.com/investor and via teleconference on Thursday, October 20, 2022, at 8:45 a.m. Eastern Time. Participants may join the conference call by dialing 877-407-8293 (or for international participants, 201-689-8349).
ABOUT UNION PACIFIC
Union Pacific (NYSE: UNP) delivers the goods families and businesses use every day with safe, reliable, and efficient service. Operating in 23 western states, the company connects its customers and communities to the global economy. Trains are the most environmentally responsible way to move freight, helping Union Pacific protect future generations. More information about Union Pacific is available at www.up.com.
Supplemental financial information is attached.
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This news release and related materials contain statements about the Company's future that are not statements of historical fact, including specifically the statements regarding the Company's expectations with respect to economic conditions and demand levels, its ability to improve network performance (including those in response to increased traffic), its results of operations, and potential impacts of the COVID-19 pandemic and the Russian-Ukraine conflict. These statements are, or will be, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of 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 Company'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 Company'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 Company'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 Company's Annual Report on Form 10-K for 2021, which was filed with the SEC on February 4, 2022. The Company 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 Company 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 Company does update one or more forward-looking statements, no inference should be drawn that the Company 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 | ||||||||||||||||||||||||
Millions, Except Per Share Amounts and | 3rd Quarter | Year-to-Date | ||||||||||||||||||||||
Percentages, For the Periods Ended September 30, | 2022 | 2021 | % | 2022 | 2021 | % | ||||||||||||||||||
Operating Revenues | ||||||||||||||||||||||||
Freight revenues | $ | 6,109 | $ | 5,166 | 18 | % | $ | 17,391 | $ | 14,947 | 16 | % | ||||||||||||
Other revenues | 457 | 400 | 14 | 1,304 | 1,124 | 16 | ||||||||||||||||||
Total operating revenues | 6,566 | 5,566 | 18 | 18,695 | 16,071 | 16 | ||||||||||||||||||
Operating Expenses | ||||||||||||||||||||||||
Compensation and benefits | 1,278 | 1,040 | 23 | 3,471 | 3,088 | 12 | ||||||||||||||||||
Fuel | 932 | 544 | 71 | 2,586 | 1,452 | 78 | ||||||||||||||||||
Purchased services and materials | 626 | 510 | 23 | 1,809 | 1,478 | 22 | ||||||||||||||||||
Depreciation | 563 | 553 | 2 | 1,677 | 1,652 | 2 | ||||||||||||||||||
Equipment and other rents | 215 | 217 | (1) | 660 | 629 | 5 | ||||||||||||||||||
Other | 319 | 270 | 18 | 987 | 874 | 13 | ||||||||||||||||||
Total operating expenses | 3,933 | 3,134 | 25 | 11,190 | 9,173 | 22 | ||||||||||||||||||
Operating Income | 2,633 | 2,432 | 8 | 7,505 | 6,898 | 9 | ||||||||||||||||||
Other income, net | 124 | 38 | F | 334 | 214 | 56 | ||||||||||||||||||
Interest expense | (315) | (290) | 9 | (938) | (862) | 9 | ||||||||||||||||||
Income before income taxes | 2,442 | 2,180 | 12 | 6,901 | 6,250 | 10 | ||||||||||||||||||
Income taxes | (547) | (507) | 8 | (1,541) | (1,438) | 7 | ||||||||||||||||||
Net Income | $ | 1,895 | $ | 1,673 | 13 | % | $ | 5,360 | $ | 4,812 | 11 | % | ||||||||||||
Share and Per Share | ||||||||||||||||||||||||
Earnings per share - basic | $ | 3.05 | $ | 2.58 | 18 | % | $ | 8.56 | $ | 7.31 | 17 | % | ||||||||||||
Earnings per share - diluted | $ | 3.05 | $ | 2.57 | 19 | $ | 8.54 | $ | 7.29 | 17 | ||||||||||||||
Weighted average number of shares - basic | 620.4 | 648.7 | (4) | 626.1 | 658.3 | (5) | ||||||||||||||||||
Weighted average number of shares - diluted | 621.5 | 650.3 | (4) | 627.4 | 659.9 | (5) | ||||||||||||||||||
Dividends declared per share | $ | 1.30 | $ | 1.07 | 21 | $ | 3.78 | $ | 3.11 | 22 | ||||||||||||||
Operating Ratio | 59.9 | % | 56.3 | % | 3.6 | pts | 59.9 | % | 57.1 | % | 2.8 | pts | ||||||||||||
Effective Tax Rate | 22.4 | % | 23.3 | % | (0.9) | pts | 22.3 | % | 23.0 | % | (0.7) | pts | ||||||||||||
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES | ||||||||||||||||||||||||
3rd Quarter | Year-to-Date | |||||||||||||||||||||||
For the Periods Ended September 30, | 2022 | 2021 | % | 2022 | 2021 | % | ||||||||||||||||||
Freight Revenues (Millions) | ||||||||||||||||||||||||
Grain & grain products | $ | 880 | $ | 731 | 20 | % | $ | 2,624 | $ | 2,292 | 14 | % | ||||||||||||
Fertilizer | 178 | 172 | 3 | 541 | 521 | 4 | ||||||||||||||||||
Food & refrigerated | 290 | 253 | 15 | 828 | 739 | 12 | ||||||||||||||||||
Coal & renewables | 611 | 531 | 15 | 1,611 | 1,295 | 24 | ||||||||||||||||||
Bulk | 1,959 | 1,687 | 16 | 5,604 | 4,847 | 16 | ||||||||||||||||||
Industrial chemicals & plastics | 579 | 503 | 15 | 1,656 | 1,436 | 15 | ||||||||||||||||||
Metals & minerals | 601 | 488 | 23 | 1,648 | 1,330 | 24 | ||||||||||||||||||
Forest products | 390 | 342 | 14 | 1,140 | 1,006 | 13 | ||||||||||||||||||
Energy & specialized markets | 624 | 578 | 8 | 1,762 | 1,654 | 7 | ||||||||||||||||||
Industrial | 2,194 | 1,911 | 15 | 6,206 | 5,426 | 14 | ||||||||||||||||||
Automotive | 601 | 417 | 44 | 1,663 | 1,292 | 29 | ||||||||||||||||||
Intermodal | 1,355 | 1,151 | 18 | 3,918 | 3,382 | 16 | ||||||||||||||||||
Premium | 1,956 | 1,568 | 25 | 5,581 | 4,674 | 19 | ||||||||||||||||||
Total | $ | 6,109 | $ | 5,166 | 18 | % | $ | 17,391 | 14,947 | 16 | % | |||||||||||||
Revenue Carloads (Thousands) | ||||||||||||||||||||||||
Grain & grain products | 190 | 185 | 3 | % | 590 | 592 | - | % | ||||||||||||||||
Fertilizer | 51 | 55 | (7) | 149 | 153 | (3) | ||||||||||||||||||
Food & refrigerated | 48 | 48 | - | 143 | 141 | 1 | ||||||||||||||||||
Coal & renewables | 243 | 232 | 5 | 670 | 604 | 11 | ||||||||||||||||||
Bulk | 532 | 520 | 2 | 1,552 | 1,490 | 4 | ||||||||||||||||||
Industrial chemicals & plastics | 165 | 153 | 8 | 486 | 449 | 8 | ||||||||||||||||||
Metals & minerals | 202 | 188 | 7 | 589 | 516 | 14 | ||||||||||||||||||
Forest products | 62 | 63 | (2) | 189 | 187 | 1 | ||||||||||||||||||
Energy & specialized markets | 140 | 145 | (3) | 412 | 422 | (2) | ||||||||||||||||||
Industrial | 569 | 549 | 4 | 1,676 | 1,574 | 6 | ||||||||||||||||||
Automotive | 198 | 166 | 19 | 580 | 519 | 12 | ||||||||||||||||||
Intermodal [a] | 811 | 809 | - | 2,373 | 2,483 | (4) | ||||||||||||||||||
Premium | 1,009 | 975 | 3 | 2,953 | 3,002 | (2) | ||||||||||||||||||
Total | 2,110 | 2,044 | 3 | % | 6,181 | 6,066 | 2 | % | ||||||||||||||||
Average Revenue per Car | ||||||||||||||||||||||||
Grain & grain products | $ | 4,641 | $ | 3,937 | 18 | % | $ | 4,449 | $ | 3,869 | 15 | % | ||||||||||||
Fertilizer | 3,504 | 3,125 | 12 | 3,634 | 3,398 | 7 | ||||||||||||||||||
Food & refrigerated | 6,017 | 5,246 | 15 | 5,809 | 5,235 | 11 | ||||||||||||||||||
Coal & renewables | 2,514 | 2,298 | 9 | 2,403 | 2,146 | 12 | ||||||||||||||||||
Bulk | 3,685 | 3,244 | 14 | 3,612 | 3,252 | 11 | ||||||||||||||||||
Industrial chemicals & plastics | 3,508 | 3,277 | 7 | 3,404 | 3,195 | 7 | ||||||||||||||||||
Metals & minerals | 2,969 | 2,596 | 14 | 2,799 | 2,577 | 9 | ||||||||||||||||||
Forest products | 6,347 | 5,457 | 16 | 6,044 | 5,390 | 12 | ||||||||||||||||||
Energy & specialized markets | 4,434 | 3,996 | 11 | 4,273 | 3,924 | 9 | ||||||||||||||||||
Industrial | 3,852 | 3,482 | 11 | 3,702 | 3,448 | 7 | ||||||||||||||||||
Automotive | 3,030 | 2,500 | 21 | 2,866 | 2,488 | 15 | ||||||||||||||||||
Intermodal [a] | 1,672 | 1,424 | 17 | 1,651 | 1,362 | 21 | ||||||||||||||||||
Premium | 1,939 | 1,608 | 21 | 1,890 | 1,557 | 21 | ||||||||||||||||||
Average | $ | 2,895 | $ | 2,528 | 15 | % | $ | 2,814 | $ | 2,464 | 14 | % | ||||||||||||
[a] | For intermodal shipments each container or trailer equals one carload. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES | ||||||||
Sep. 30, | Dec. 31, | |||||||
Millions, Except Percentages | 2022 | 2021 | ||||||
Assets | ||||||||
Cash and cash equivalents | $ | 1,267 | $ | 960 | ||||
Short-term investments | 46 | 46 | ||||||
Other current assets | 3,092 | 2,545 | ||||||
Investments | 2,314 | 2,241 | ||||||
Properties, net | 55,689 | 54,871 | ||||||
Operating lease assets | 1,703 | 1,787 | ||||||
Other assets | 1,232 | 1,075 | ||||||
Total assets | $ | 65,343 | $ | 63,525 | ||||
Liabilities and Common Shareholders' Equity | ||||||||
Debt due within one year | $ | 1,678 | $ | 2,166 | ||||
Other current liabilities | 4,034 | 3,578 | ||||||
Debt due after one year | 31,744 | 27,563 | ||||||
Operating lease liabilities | 1,303 | 1,429 | ||||||
Deferred income taxes | 12,868 | 12,675 | ||||||
Other long-term liabilities | 1,973 | 1,953 | ||||||
Total liabilities | 53,600 | 49,364 | ||||||
Total common shareholders' equity | 11,743 | 14,161 | ||||||
Total liabilities and common shareholders' equity | $ | 65,343 | $ | 63,525 | ||||
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES | ||||||||
Millions, | Year-to-Date | |||||||
for the Periods Ended September 30, | 2022 | 2021 | ||||||
Operating Activities | ||||||||
Net income | $ | 5,360 | $ | 4,812 | ||||
Depreciation | 1,677 | 1,652 | ||||||
Deferred income taxes | 180 | 189 | ||||||
Other - net | (147) | (150) | ||||||
Cash provided by operating activities | 7,070 | 6,503 | ||||||
Investing Activities | ||||||||
Capital investments* | (2,690) | (1,945) | ||||||
Maturities of short-term investments | 46 | 64 | ||||||
Purchases of short-term investments | (46) | (40) | ||||||
Other - net | 131 | 129 | ||||||
Cash used in investing activities | (2,559) | (1,792) | ||||||
Financing Activities | ||||||||
Debt issued | 6,080 | 3,901 | ||||||
Share repurchase programs | (5,497) | (5,846) | ||||||
Dividends paid | (2,362) | (2,045) | ||||||
Debt repaid | (2,185) | (1,120) | ||||||
Net issued/(paid) of commercial paper | (203) | 125 | ||||||
Debt exchange | - | (270) | ||||||
Other - net | (43) | (36) | ||||||
Cash used in financing activities | (4,210) | (5,291) | ||||||
Net Change in Cash, Cash Equivalents and Restricted Cash | 301 | (580) | ||||||
Cash, cash equivalents, and restricted cash at beginning of year | 983 | 1,818 | ||||||
Cash, cash equivalents, and restricted cash at end of period | $ | 1,284 | $ | 1,238 | ||||
Free Cash Flow** | ||||||||
Cash provided by operating activities | $ | 7,070 | $ | 6,503 | ||||
Cash used in investing activities | (2,559) | (1,792) | ||||||
Dividends paid | (2,362) | (2,045) | ||||||
Free cash flow | $ | 2,149 | $ | 2,666 | ||||
* | Capital investments include locomotive and freight car early lease buyouts of $55 million in 2022 and $34 million in 2021. |
** | Free cash flow is a non-GAAP measure; however, we believe this measure is important to management and investors in evaluating our financial performance and measures our ability to generate cash without additional external financing. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES | ||||||||||||||||||||||||
3rd Quarter | Year-to-Date | |||||||||||||||||||||||
For the Periods Ended September 30, | 2022 | 2021 | % | 2022 | 2021 | % | ||||||||||||||||||
Operating/Performance Statistics | ||||||||||||||||||||||||
Freight car velocity (daily miles per car) | 191 | 195 | (2) | % | 192 | 205 | (6) | % | ||||||||||||||||
Average train speed (miles per hour) * | 23.7 | 24.2 | (2) | 23.8 | 24.8 | (4) | ||||||||||||||||||
Average terminal dwell time (hours) * | 24.4 | 24.0 | 2 | 24.3 | 23.5 | 3 | ||||||||||||||||||
Locomotive productivity (GTMs per horsepower day) | 124 | 127 | (2) | 126 | 135 | (7) | ||||||||||||||||||
Gross ton-miles (GTMs) (millions) | 214,999 | 207,059 | 4 | 634,494 | 607,949 | 4 | ||||||||||||||||||
Train length (feet) | 9,483 | 9,359 | 1 | 9,376 | 9,340 | - | ||||||||||||||||||
Intermodal car trip plan compliance (%)** | 62 | 66 | (4) | pts | 65 | 72 | (7) | pts | ||||||||||||||||
Manifest/Automotive car trip plan compliance (%)** | 58 | 60 | (2) | pts | 59 | 65 | (6) | pts | ||||||||||||||||
Workforce productivity (car miles per employee) | 1,045 | 1,044 | - | 1,045 | 1,036 | 1 | ||||||||||||||||||
Total employees (average) | 30,841 | 29,810 | 3 | 30,582 | 29,877 | 2 | ||||||||||||||||||
Locomotive Fuel Statistics | ||||||||||||||||||||||||
Average fuel price per gallon consumed | $ | 3.96 | $ | 2.37 | 67 | % | $ | 3.64 | $ | 2.13 | 71 | % | ||||||||||||
Fuel consumed in gallons (millions) | 227 | 221 | 3 | 687 | 660 | 4 | ||||||||||||||||||
Fuel consumption rate*** | 1.056 | 1.068 | (1) | 1.083 | 1.085 | - | ||||||||||||||||||
Revenue Ton-Miles (Millions) | ||||||||||||||||||||||||
Grain & grain products | 18,554 | 17,326 | 7 | % | 59,042 | 57,864 | 2 | % | ||||||||||||||||
Fertilizer | 2,802 | 3,038 | (8) | 9,068 | 9,202 | (1) | ||||||||||||||||||
Food & refrigerated | 4,430 | 4,685 | (5) | 13,389 | 13,824 | (3) | ||||||||||||||||||
Coal & renewables | 25,169 | 24,539 | 3 | 69,977 | 62,791 | 11 | ||||||||||||||||||
Bulk | 50,955 | 49,588 | 3 | 151,476 | 143,681 | 5 | ||||||||||||||||||
Industrial chemicals & plastics | 7,702 | 7,746 | (1) | 22,946 | 22,791 | 1 | ||||||||||||||||||
Metals & minerals | 10,053 | 8,922 | 13 | 28,460 | 24,382 | 17 | ||||||||||||||||||
Forest products | 6,573 | 6,381 | 3 | 19,892 | 19,405 | 3 | ||||||||||||||||||
Energy & specialized markets | 9,322 | 9,780 | (5) | 27,493 | 28,482 | (3) | ||||||||||||||||||
Industrial | 33,650 | 32,829 | 3 | 98,791 | 95,060 | 4 | ||||||||||||||||||
Automotive | 4,347 | 3,507 | 24 | 12,634 | 11,049 | 14 | ||||||||||||||||||
Intermodal | 18,296 | 18,390 | (1) | 54,924 | 56,643 | (3) | ||||||||||||||||||
Premium | 22,643 | 21,897 | 3 | 67,558 | 67,692 | - | ||||||||||||||||||
Total | 107,248 | 104,314 | 3 | % | 317,825 | 306,433 | 4 | % | ||||||||||||||||
* | Surface Transportation Board (STB) reported performance measures. |
** | Methodology used to report is not comparable with the reporting to the STB under docket number EP 770. |
*** | Fuel consumption is computed as follows: gallons of fuel consumed divided by gross ton-miles in thousands. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES | ||||||||||||||||
2022 | ||||||||||||||||
Millions, Except Per Share Amounts and Percentages, | 1st Qtr | 2nd Qtr | 3rd Qtr | Year-to-Date | ||||||||||||
Operating Revenues | ||||||||||||||||
Freight revenues | $ | 5,440 | $ | 5,842 | $ | 6,109 | $ | 17,391 | ||||||||
Other revenues | 420 | 427 | 457 | 1,304 | ||||||||||||
Total operating revenues | 5,860 | 6,269 | 6,566 | 18,695 | ||||||||||||
Operating Expenses | ||||||||||||||||
Compensation and benefits | 1,101 | 1,092 | 1,278 | 3,471 | ||||||||||||
Fuel | 714 | 940 | 932 | 2,586 | ||||||||||||
Purchased services and materials | 561 | 622 | 626 | 1,809 | ||||||||||||
Depreciation | 555 | 559 | 563 | 1,677 | ||||||||||||
Equipment and other rents | 215 | 230 | 215 | 660 | ||||||||||||
Other | 337 | 331 | 319 | 987 | ||||||||||||
Total operating expenses | 3,483 | 3,774 | 3,933 | 11,190 | ||||||||||||
Operating Income | 2,377 | 2,495 | 2,633 | 7,505 | ||||||||||||
Other income, net | 47 | 163 | 124 | 334 | ||||||||||||
Interest expense | (307) | (316) | (315) | (938) | ||||||||||||
Income before income taxes | 2,117 | 2,342 | 2,442 | 6,901 | ||||||||||||
Income taxes | (487) | (507) | (547) | (1,541) | ||||||||||||
Net Income | $ | 1,630 | $ | 1,835 | $ | 1,895 | $ | 5,360 | ||||||||
Share and Per Share | ||||||||||||||||
Earnings per share - basic | $ | 2.58 | $ | 2.93 | $ | 3.05 | $ | 8.56 | ||||||||
Earnings per share - diluted | $ | 2.57 | $ | 2.93 | $ | 3.05 | $ | 8.54 | ||||||||
Weighted average number of shares - basic | 632.2 | 625.6 | 620.4 | 626.1 | ||||||||||||
Weighted average number of shares - diluted | 633.6 | 626.8 | 621.5 | 627.4 | ||||||||||||
Dividends declared per share | $ | 1.18 | $ | 1.30 | $ | 1.30 | $ | 3.78 | ||||||||
Operating Ratio | 59.4 | % | 60.2 | % | 59.9 | % | 59.9 | % | ||||||||
Effective Tax Rate | 23.0 | % | 21.6 | % | 22.4 | % | 22.3 | % | ||||||||
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES | ||||||||||||||||
2022 | ||||||||||||||||
1st Qtr | 2nd Qtr | 3rd Qtr | Year-to-Date | |||||||||||||
Freight Revenues (Millions) | ||||||||||||||||
Grain & grain products | $ | 877 | $ | 867 | $ | 880 | $ | 2,624 | ||||||||
Fertilizer | 180 | 183 | 178 | 541 | ||||||||||||
Food & refrigerated | 267 | 271 | 290 | 828 | ||||||||||||
Coal & renewables | 508 | 492 | 611 | 1,611 | ||||||||||||
Bulk | 1,832 | 1,813 | 1,959 | 5,604 | ||||||||||||
Industrial chemicals & plastics | 520 | 557 | 579 | 1,656 | ||||||||||||
Metals & minerals | 485 | 562 | 601 | 1,648 | ||||||||||||
Forest products | 364 | 386 | 390 | 1,140 | ||||||||||||
Energy & specialized markets | 552 | 586 | 624 | 1,762 | ||||||||||||
Industrial | 1,921 | 2,091 | 2,194 | 6,206 | ||||||||||||
Automotive | 501 | 561 | 601 | 1,663 | ||||||||||||
Intermodal | 1,186 | 1,377 | 1,355 | 3,918 | ||||||||||||
Premium | 1,687 | 1,938 | 1,956 | 5,581 | ||||||||||||
Total | $ | 5,440 | $ | 5,842 | $ | 6,109 | $ | 17,391 | ||||||||
Revenue Carloads (Thousands) | ||||||||||||||||
Grain & grain products | 205 | 195 | 190 | 590 | ||||||||||||
Fertilizer | 45 | 53 | 51 | 149 | ||||||||||||
Food & refrigerated | 47 | 48 | 48 | 143 | ||||||||||||
Coal & renewables | 225 | 202 | 243 | 670 | ||||||||||||
Bulk | 522 | 498 | 532 | 1,552 | ||||||||||||
Industrial chemicals & plastics | 160 | 161 | 165 | 486 | ||||||||||||
Metals & minerals | 182 | 205 | 202 | 589 | ||||||||||||
Forest products | 64 | 63 | 62 | 189 | ||||||||||||
Energy & specialized markets | 131 | 141 | 140 | 412 | ||||||||||||
Industrial | 537 | 570 | 569 | 1,676 | ||||||||||||
Automotive | 190 | 192 | 198 | 580 | ||||||||||||
Intermodal [a] | 757 | 805 | 811 | 2,373 | ||||||||||||
Premium | 947 | 997 | 1,009 | 2,953 | ||||||||||||
Total | 2,006 | 2,065 | 2,110 | 6,181 | ||||||||||||
Average Revenue per Car | ||||||||||||||||
Grain & grain products | $ | 4,269 | $ | 4,451 | $ | 4,641 | $ | 4,449 | ||||||||
Fertilizer | 4,016 | 3,437 | 3,504 | 3,634 | ||||||||||||
Food & refrigerated | 5,637 | 5,770 | 6,017 | 5,809 | ||||||||||||
Coal & renewables | 2,262 | 2,426 | 2,514 | 2,403 | ||||||||||||
Bulk | 3,508 | 3,642 | 3,685 | 3,612 | ||||||||||||
Industrial chemicals & plastics | 3,247 | 3,455 | 3,508 | 3,404 | ||||||||||||
Metals & minerals | 2,660 | 2,755 | 2,969 | 2,799 | ||||||||||||
Forest products | 5,672 | 6,128 | 6,347 | 6,044 | ||||||||||||
Energy & specialized markets | 4,219 | 4,161 | 4,434 | 4,273 | ||||||||||||
Industrial | 3,574 | 3,674 | 3,852 | 3,702 | ||||||||||||
Automotive | 2,640 | 2,919 | 3,030 | 2,866 | ||||||||||||
Intermodal [a] | 1,566 | 1,711 | 1,672 | 1,651 | ||||||||||||
Premium | 1,782 | 1,943 | 1,939 | 1,890 | ||||||||||||
Average | $ | 2,711 | $ | 2,830 | $ | 2,895 | $ | 2,814 | ||||||||
[a] | For intermodal shipments each container or trailer equals one carload. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES | ||||||||
Adjusted Debt / Adjusted EBITDA* | ||||||||
Millions, Except Ratios | Sep. 30, | Dec. 31, | ||||||
for the Trailing Twelve Months Ended [a] | 2022 | 2021 | ||||||
Net income | $ | 7,071 | $ | 6,523 | ||||
Add: | ||||||||
Income tax expense | 2,058 | 1,955 | ||||||
Depreciation | 2,233 | 2,208 | ||||||
Interest expense | 1,233 | 1,157 | ||||||
EBITDA | $ | 12,595 | $ | 11,843 | ||||
Adjustments: | ||||||||
Other income, net | (417) | (297) | ||||||
Interest on operating lease liabilities [b] | 52 | 56 | ||||||
Adjusted EBITDA | $ | 12,230 | $ | 11,602 | ||||
Debt | $ | 33,422 | $ | 29,729 | ||||
Operating lease liabilities | 1,629 | 1,759 | ||||||
Unfunded/(funded) pension and OPEB, net of tax cost/(benefit) of ($40) and ($21) | (139) | (72) | ||||||
Adjusted debt | $ | 34,912 | $ | 31,416 | ||||
Adjusted debt / adjusted EBITDA | 2.9 | 2.7 | ||||||
[a] | The trailing twelve months income statement information ended September 30, 2022, is recalculated by taking the twelve months ended December 31, 2021, subtracting the nine months ended September 30, 2021, and adding the nine months ended September 30, 2022. |
[b] | Represents the hypothetical interest expense we would incur (using the incremental borrowing rate) if the property under our operating leases were owned or accounted for as finance leases. |
* | Total debt plus operating lease liabilities plus after-tax unfunded pension and OPEB (other postretirement benefit) obligations divided by net income plus income tax expense, depreciation, amortization, interest expense, and adjustments for other income and interest on operating lease liabilities. Adjusted debt to adjusted EBITDA (earnings before interest, taxes, depreciation, amortization, and adjustments for other income and interest on operating lease liabilities) 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 to management and investors in evaluating the Company's ability to sustain given debt levels (including leases) with the cash generated from operations. In addition, a comparable measure is used by rating agencies when reviewing the Company's credit rating. Adjusted debt to adjusted EBITDA should be considered in addition to, rather than as a substitute for, net income. The table above provides a reconciliation from net income to adjusted debt to adjusted EBITDA. At both September 30, 2022, and December 31, 2021, the incremental borrowing rate on operating lease liabilities was 3.2%. |
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES | |||||||||||||
Financial Performance* | |||||||||||||
Millions, Except Per Share Amounts | Reported results | Labor accrual | Adjusted results | ||||||||||
For the Three Months Ended September 30, 2022 | (GAAP) | adjustment | (non-GAAP) | ||||||||||
Operating income | $ | 2,633 | $ | 114 | $ | 2,747 | |||||||
Net income | 1,895 | 86 | 1,981 | ||||||||||
Diluted EPS | $ | 3.05 | $ | 0.14 | $ | 3.19 | |||||||
Operating ratio | 59.9 | % | (1.7) | pts | 58.2 | % | |||||||
Millions, Except Per Share Amounts | Reported results | Labor accrual | Adjusted results | ||||||||||
For the Nine Months Ended September 30, 2022 | (GAAP) | adjustment | (non-GAAP) | ||||||||||
Operating income | $ | 7,505 | $ | 114 | $ | 7,619 | |||||||
Net income | 5,360 | 86 | 5,446 | ||||||||||
Diluted EPS | $ | 8.54 | $ | 0.14 | $ | 8.68 | |||||||
Operating ratio | 59.9 | % | (0.7) | pts | 59.2 | % | |||||||
* | The above tables reconcile our results for the three and nine months ended September 30, 2022, to adjust results that exclude the impact of certain items identified as affecting comparability. We use adjusted operating income, adjusted net income, adjusted diluted earnings per share (EPS), and adjusted operating ratio, as applicable, among other measures, to evaluate our actual operating performance. We believe these non-GAAP financial measures provide valuable information regarding earnings and business trends by excluding specific items that we believe are not indicative of our ongoing operating results of our business, providing a useful way for investors to make a comparison of our performance over time and against other companies in our industry. Since these are not measures of performance calculated in accordance with GAAP, they should be considered in addition to, rather than as a substitute for, operating income, net income, diluted EPS, and operating ratio as indicators of operating performance. |
SOURCE Union Pacific Corporation
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