Union Pacific's Unified Plan 2020 produced another record quarter in earnings, operating income and an improved operating ratio.
UP today reported 2019 second quarter net income of $1.6 billion or $2.22 per share. That is up from $1.5 billion, or $1.98 per share, in the second quarter 2018.
Second Quarter Results
Earnings per share of $2.22 increased 12 percent. Operating income totaled $2.3 billion, up 8 percent.. Operating ratio of 59.6 percent, improved 3.4 points.
"We delivered record second quarter financial results driven by exceptional operating performance, including an all-time best quarterly operating ratio of 59.6 percent," said Lance Fritz, Union Pacific chairman, president and chief executive officer. "These results are a testament to the dedication of the men and women of Union Pacific, who are embracing Unified Plan 2020 and who worked closely with our customers to overcome numerous weather challenges." Second Quarter Summary Operating revenue of $5.6 billion was down 1 percent in second quarter 2019, compared to second quarter 2018. Second quarter business volumes, as measured by total revenue carloads, decreased 4 percent compared to 2018. Growth in industrial volumes were more than offset by flat agricultural products shipments as well as declines in energy and premium. In addition:
Quarterly freight revenue declined 2 percent, compared to second quarter 2018, as core pricing gains were offset by lower volumes. Union Pacific's all-time best 59.6 percent operating ratio improved 3.4 points, compared to second quarter 2018. The $2.21 per gallon average quarterly diesel fuel price in the second quarter 2019 was 4 percent lower than second quarter 2018. Union Pacific recognized a payroll tax refund of $32 million, along with associated interest income of $3 million in second quarter 2019. Quarterly freight car velocity was 195 daily miles per car, a 4 percent improvement compared to the second quarter 2018. Union Pacific's first half reportable personal injury rate was 0.87 per 200,000 employee-hours, compared to 0.76 in first half 2018. The Company repurchased 3.7 million shares in the second quarter 2019 at an aggregate cost of $639 million.
Summary of Second Quarter Freight Revenues
Agricultural Products up 4 percent Industrial up 4 percent Premium down 2 percent Energy down 13 percent
2019 Outlook "We look forward to building on the momentum from Unified Plan 2020 and providing a consistent, reliable service product for our customers," Fritz said. "We remain focused on driving increased shareholder returns by appropriately investing capital in the railroad and returning excess cash to our shareholders."