Union Pacific Posts Record Results
First Quarter 2006 Earnings Per Share More Than Doubled
Omaha, Neb., April 20, 2006
- First quarter 2006 earnings more than doubled to $1.15 per diluted share.
- Commodity revenue was an all-time quarterly record of $3.5 billion, up 18 percent.
- Operating income grew 93 percent to $605 million.
- First quarter 2006 operating ratio improved 6.4 points to 83.7 percent.
"This quarter was positive for us in many ways," said Jim Young, president and chief executive officer. "We experienced record growth in our business, moved these volumes more efficiently and improved our bottom-line results. Most importantly, we provided better service to our customers."
First Quarter Summary
Union Pacific Corporation reported record operating revenue of $3.7 billion in the first quarter of 2006 compared to last year’s $3.2 billion. Operating income in the first quarter of 2006 was $605 million compared to $313 million for the same period in 2005 – a 93 percent improvement.
- First quarter 2006 commodity revenue was an all-time record of $3.5 billion, up 18 percent, compared to $3.0 billion in 2005. Drivers of the increase were a 4 percent increase in volumes as well as increased fuel surcharge revenue and yields.
- First quarter 2006 average revenue per car was at an all-time best $1,481, versus $1,306 in the first quarter of 2005.
- The operating ratio improved to 83.7 percent in the first quarter of 2006 from 90.1 percent in the first quarter 2005.
- The Railroad’s 2006 average quarterly fuel price of $1.87 per gallon compares to $1.45 per gallon paid a year ago.
2006 First Quarter Commodity Revenue Summary versus 2005
- Agricultural up 26 percent
- Automotive, Industrial Products and Intermodal each up 23 percent
- Chemicals up 14 percent
- Energy up 5 percent
"Looking ahead we continue to see solid demand, which should support future volume and yield growth," Young said. "Our challenge will be to continue to handle that growth more efficiently.
"Although we made progress in the quarter with our operating initiatives, we have a long way to go before we are satisfied with our service, velocity and returns. We will work hard over the weeks and months ahead to make further improvement."
Union Pacific Corporation owns one of America’s leading transportation companies. Its principal operating company, Union Pacific Railroad, links 23 states in the western two-thirds of the country and serves the fastest-growing U.S. population centers. Union Pacific’s diversified business mix includes Agricultural Products, Automotive, Chemicals, Energy, Industrial Products and Intermodal. The railroad offers competitive long-haul routes from all major West Coast and Gulf Coast ports to eastern gateways. Union Pacific connects with Canada’s rail systems and is the only railroad serving all six major gateways to Mexico, making it North America’s premier rail franchise.
Additional information regarding Union Pacific is available on our Web site, www.up.com.
Our contact for investors is Jennifer Hamann at (402) 544-4227.
Our media contact is Kathryn Blackwell (402) 544-3753.
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Important factors that 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 include, but are not limited to: whether the Corporation and its subsidiaries are fully successful in implementing their financial and operational initiatives, including those plans and management initiatives to improve system velocity and network performance or otherwise improve operations; the impact of ongoing track maintenance and restoration work being performed in the Southern Powder River Basin of Wyoming; the outcome of claims and litigation, including those related to environmental contamination, personal injuries, and occupational illnesses arising from hearing loss, repetitive motion and exposure to asbestos and diesel fumes; legislative and regulatory developments, including possible enactment of initiatives to re-regulate the rail industry; the impact of a rail accident involving the release of hazardous materials; natural events such as severe weather, fire, floods, hurricanes and earthquakes; changes in fuel prices; changes in labor costs, labor stoppages, and the availability of qualified personnel required for our operations; industry competition, conditions, performance and consolidation; legislative, regulatory and legal developments involving taxation, including enactment of new federal or state income tax rates, revisions of controlling authority and the outcome of tax claims and litigation; changes in securities and capital markets; the effects of adverse general economic conditions, both within the United States and globally; any adverse economic or operational repercussions from terrorist activities and any governmental response thereto; and war or risk of war. More information regarding risk factors is available in the Corporation’s Annual Report on Form 10-K for 2005, which was filed with the SEC on February 24, 2006. The Corporation updates information regarding risk factors if circumstances require such updates in its periodic reports on Form 10-Q (or such other reports that may be filed with the SEC).
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