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Rail News: Union Pacific Railroad
UP anticipates best-ever earnings, lower operating ratio in 3Q results
Union Pacific Corp. doesn't release its third-quarter financial results until Oct. 17, but yesterday the Class I shared some of its performance expectations for the quarter.
The railroad anticipates it will report best-ever quarterly earnings in the range of $2.45 to $2.48 per diluted share, which would represent a double-digit increase compared with third-quarter 2012 earnings.
Overall quarterly volume appears to be flat as mild summer weather combined with disruptions from Colorado flooding impacted coal traffic, and, to a lesser extent, other commodities, while the uncertain economic environment continued to impact intermodal shipments, UP officials said in a press release.
Other third-quarter expectations include operating revenue growth of 4 percent to 4.5 percent; an operating ratio improvement of about 1.5 points from third-quarter 2012's 66.6; and a $10 million negative impact on operating income due to lost revenue and increased costs associated with the Colorado floods.
"Our strong third-quarter expectations reflect continued core pricing gains, ongoing productivity initiatives and strong returns to our shareholders," said UP Executive Vice President and Chief Financial Officer Rob Knight. "In the fourth quarter, we expect these positive trends to continue, and we're hopeful that the economy cooperates and this year's grain harvest meets current projections, enabling year-over-year volume growth."
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