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Union Pacific Railroad today reported better-than-expected third-quarter earnings and revenue despite the Class I's business disruptions caused by Hurricane Harvey.UP announced third-quarter net income increased to $1.2 billion, or $1.50 per diluted share, compared with net income of $1.1 billion, or $1.36 per diluted share, in the same period a year ago. Operating revenue rose 5 percent to $5.4 billion, operating expenses climbed 6 percent to $3.4 billion and operating income increased 3 percent to $2 billion compared with third-quarter 2016.UP's earnings per share of $1.50 was higher than the $1.49 per share expected by a Thomson Reuters' survey of analysts.The Class I's operating ratio of 62.8 percent for the quarter was up 0.7 points compared with last year's third-quarter ratio."During the quarter, our company faced the unprecedented challenge of Hurricane Harvey," said Chairman, President and Chief Executive Officer Lance Fritz in a press release. "Given these challenges, I am pleased with our results and look forward to continuing to build on the foundation provided by our six-track value strategy."The storm negatively impacted earnings per share by 4 cents.Business volumes, as measured by total revenue carloads, declined 1 percent compared to third-quarter 2016. Volume increases in industrial products were more than offset by declines in agricultural products, automotive, chemicals and coal, UP officials said. Intermodal volume was flat compared to what it was in third-quarter 2016.Also in Q3 2017:• Freight revenue rose 4 percent, with increased fuel surcharge revenue, core pricing gains and positive mix of traffic all contributing to the increase.• The $1.77 per gallon average quarterly diesel fuel price was 13 percent higher than in third-quarter 2016.• Quarterly train speed, as reported to the Association of American Railroads, was 25.4 mph, 2 percent slower than the same period a year ago.• The year-to-date reportable personal injury rate of 0.78 per 200,000 employee-hours increased from the record year-to-date rate of 0.77 achieved in 2016.As measured by freight revenue, automotive declined 3 percent; agricultural products fell 2 percent; and coal decreased 2 percent. Freight revenue for the quarter rose for chemicals, up 2 percent; intermodal, up 3 percent; and industrial products, up 26 percent compared with third-quarter 2016 results."As the economy continues to ebb and flow, we will focus on executing our value strategy," Fritz said. "We will use innovation to enhance our customer experience while continuing to drive resource productivity throughout the organization as we progress our G55 + 0 initiatives."Looking ahead to 2018, UP's goal "is to continue creating long-term enterprise value for all of our stakeholders as we improve our top-line and progress toward our margin improvement targets," Fritz added.
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