[310119.EN.BIZ] Union Pacific 2018 Profit Up 29pc to US$6 Billion As Sales Rise 7.5pc

THE Omaha-based Union Pacific Railroad posted a 29 per cent year-on-year profit increase to US$6 billion in 2018, drawn on operational revenues of $22.8 billion, up 7.5 per cent.

Fourth quarter also increased American largest railway net profit 29 per cent year on year to a record $1.6 billion, drawn on revenues of $5.8 billion, up six per cent.

Union Pacific CEO Lance Fritz credited "strong volume growth, core pricing gains and regaining positive productivity momentum" for UP's good fortune.

"We are optimistic that continued economic growth, improving service performance will drive positive volume and revenue growth in 2019," Mr Fritz said.

Mr Fritz, also UP chairman and president, said the railway as advancing its previously announced reform Unified Plan 2020.

"We expect operating margins will increase as a result of solid core pricing gains and significant productivity benefits from our G55 + 0 initiatives, including Unified Plan 2020,"

"Since starting this initiative in October, we have improved on-time service for our customers while at the same time eliminating excess costs and improving the utilisation of network resources," Mr Fritz said.

Union Pacific said strong growth in industrial and premium shipments more than offset declines in agricultural products and energy.

"Quarterly freight revenue increased six per cent compared to the fourth quarter 2017, as positive volume, increased fuel surcharge revenue and core pricing gains all contributed to the increase, but were partially offset by negative business mix," said the UP statement.

"Quarterly train speed, as reported to the Association of American Railroads, was 24.4 mph, three per cent slower than the fourth quarter 2017.

"Terminal dwell was 26.7 hours, an 18 per cent improvement compared to the fourth quarter 2017," said the statement.

Source : HKSG.