Union Pacific 2Q Profit Declines, As Pandemic Holds Back Demand
July 23 2020 - 8:52AM
Dow Jones News
By Micah Maidenberg
Union Pacific Corp. reported a weaker second-quarter profit,
reflecting how demand for shipments across the company's business
lines fell off amid coronavirus-related shutdowns earlier this
year.
Union Pacific said earnings dropped to $1.13 billion, or $1.67 a
share, from $1.57 billion, or $2.22 a share, for the second quarter
last year. Profit on a per-share basis topped expectations from
analysts, according to FactSet.
The Omaha, Neb.-based railroad said quarterly volume dropped by
20% year over year. It warned that for the year, it believes
carload volumes will be down roughly 10%.
"Volumes for all three business teams - bulk, industrial and
premium - declined in the quarter due to the deteriorating economic
conditions brought on by the Covid-19 pandemic," the company
said.
CSX Corp. and Canadian Pacific Railway Ltd. Wednesday said they
also struggled with falling volumes and reported weaker earnings
for the second quarter.
Union Pacific reported revenue of $4.24 billion, down 24%
compared with last year and weaker than forecast from analysts, who
predicted the company would generate more than $4.39 billion in
revenue.
Cost cuts helped the company grapple with the weakness in
demand. Operating expenses were down 22% overall. Employee
compensation dropped 21% and fuel costs fell 56%, Union Pacific
said.
The company recognized a $69 million gain from a real-estate
sale to the Illinois State Toll Highway Authority. That deal added
seven cents a share to profit for the quarter.
Write to Micah Maidenberg at micah.maidenberg@wsj.com
(END) Dow Jones Newswires
July 23, 2020 08:37 ET (12:37 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
Union Pacific (NYSE:UNP)
Historical Stock Chart
From Mar 2024 to Apr 2024
Union Pacific (NYSE:UNP)
Historical Stock Chart
From Apr 2023 to Apr 2024