By JOSH FUNKAP Business Writer
OMAHA, Neb. (AP) - Union Pacific Corp. says rate increases helped lift its second-quarter profit by 10 percent, even though the number of carloads the railroad hauled slipped by 1 percent.
The Omaha, Neb.-based railroad said Thursday that it generated $1.11 billion in net income, or $2.37 per share, in the quarter that ended June 30. That's up from $1 billion, or $2.10 per share, in the same months last year.
Revenue rose 5 percent, to $5.47 billion.
Analysts surveyed by FactSet predicted Union Pacific would report earnings of $2.35 per share on $5.5 billion in revenue.
Even after the strong quarter, Union Pacific CEO Jack Koraleski remained cautious.
"As we move into the second half of the year, the economic outlook remains uncertain, but we're hopeful that we'll see some economic improvement in the months ahead," Koraleski said.
Union Pacific's stock slipped 43 cents in pre-market trading to $159.25.
Coal volumes were roughly even with last year's weak levels, suggesting that demand may have bottomed out. Over the past two years, many utilities have cut back on coal purchases because of relatively cheap natural gas prices and environmental concerns.
The railroad reported stronger revenue in every area except agricultural products and intermodal containers.
Union Pacific said the volume of intermodal containers imported off of ships fell 8 percent in the quarter as activity at West Coast ports slowed. The number of containers moved off of trucks to the railroad increased 3 percent.
Union Pacific said revenue improved 12 percent in its automotive, chemical and coal businesses, and industrial products revenue grew 7 percent.
Union Pacific operates 32,400 miles of track in 23 states from the Midwest to the West and Gulf coasts.
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Union Pacific Corp.: www.up.com
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