Union Pacific Corporation (NYSE: UNP) reported a 2% decline in earnings for the third quarter of 2019 due to lower volumes, decreased fuel surcharge revenue, and negative mix. The results missed analysts’ expectations.
Net income decreased by 2% to $1.56 billion while earnings per share rose by 3% to $2.22 on lower weighted average diluted shares outstanding. Operating revenue dropped by 7% to $5.52 billion as lower volumes, decreased fuel surcharge revenue, and negative mix hurt freight revenue by 7%.
Check out the infographic on Union Pacific below.
The business volume, as measured by total revenue carloads, decreased by 8%. The growth in industrial volumes was more than offset by declines in agricultural products, premiums, and energy shipments.
Looking ahead into the full year 2019, the company now expects capital expenditures of about $3.1 billion. The operating ratio is still expected to be at sub-61% in 2019 and below 60% in 2020. In the fourth quarter, volumes are anticipated to be down at level similar to Q3.
Freight revenue decreased by 7% year-over-year, as core pricing gains were offset by lower volumes. Agricultural products and industrial were down by 1%, while the premium dropped by 9% and energy fell by 20%.
The $2.09 per gallon average quarterly diesel fuel price in the third quarter was 12% lower than the previous year quarter. Quarterly freight car velocity was 213 daily miles per car, a 10% improvement compared to the year-ago period.
The railroads’ industry has been experiencing a decline in rail traffic, which implies a slowing economy. Union Pacific and other railroads companies have been vulnerable to more volume declines for the third quarter. Fuel costs declined by double-digits as Union Pacific consumed less fuel.
In rivals, Kansas City Southern (NYSE: KSU) is scheduled to report its earnings results for the third quarter of 2019 on Friday before the market opens. Analysts expect Kansas City Southern’s earnings to jump by 14% to $1.79 per share and revenue will rise by 5.10% to $734.9 million for the third quarter.
Get access to timely and accurate verbatim transcripts that are published within hours of the event.
Most Popular
Intensity Therapeutics is establishing a new field of localized cancer reduction: CEO
Intensity Therapeutics, Inc. (NASDAQ: INTS) is a clinical biotechnology company engaged in the discovery development, and commercialization of first-in-class cancer drugs that attenuate tumors with minimal side effects while training
INTU Earnings: Intuit Q1 2025 adj. profit rises on higher revenues
Financial technology company Intuit Inc. (NASDAQ: INTU) Thursday announced results for the first quarter of 2025, reporting a modest increase in adjusted earnings. The Mountain View-headquartered company’s first-quarter revenue came
Riding the AI wave, Nvidia looks set to stay on the high-growth path
After delivering strong results for the third quarter, Nvidia Corporation (NASDAQ: NVDA) this week said the launch of its new-generation Blackwell chip is on track. The company is thriving on
