(Reuters circulated the following article on July 20.)
CHICAGO — U.S. railroad Union Pacific Corp. on Thursday said its quarterly net profit rose 67 percent due to rising commodity volumes and fuel surcharges, beating market expectations.
The Omaha, Nebraska-based company said second-quarter net income increased to $390 million, or $1.44 a share, from $233 million, or 88 cents a share, a year earlier.
Analysts had expected earnings per share of $1.33, according to Reuters Estimates.
“Basically it was another great quarter with big upside on revenue and big upside on earnings per share,” said Shawn Campbell, principal of Campbell Asset Management, which holds Union Pacific stock.
“The real question moving forward is how Union Pacific and the other railroads perform if there is a downturn in the economy,” he added.
Union Pacific said revenue in the second quarter totaled $3.9 billion, compared with $3.3 billion a year earlier.
Analysts had expected revenue of $3.88 billion, according to Reuters Estimates.
Union Pacific said that volumes should remain strong throughout the rest of the year.
“We expect the volume strength we saw in the first half of the year to continue through the upcoming peak shipping season,” Chief Executive Officer Jim Young said in a statement. “The biggest challenge ahead for us will be to continue to make progress on our operating initiatives, productivity and service reliability in the face of record volume.”