(The following story by Joe Ruff appeared on the Omaha World-Herald website on April 23, 2009.)
OMAHA, Neb. — Union Pacific reported today an 18 percent drop in net income for its first quarter, driven by decreased demand in the global recession.
The Omaha-based freight railroad reported net income of $362 million, or 72 cents a share, in the three months ending March 31, compared with $443 million, or 85 cents a share, in the same period last year. Revenue was down 20 percent to $3.4 billion compared with $4.3 billion last year.
The weak global economy affected all six of Union Pacific’s business groups. Business volume was down 21 percent compared with last year’s first quarter. A decline in fuel surcharge revenue contributed to the drop in freight revenue.
Automotive revenue was down 55 percent, followed by a 29 percent decline in industrial products, a 22 percent drop in intermodal business and a 15 percent decline in chemicals. Agriculture was down 13 percent and energy was down 6 percent.
Chairman and CEO Jim Young said the company is reducing costs across the board to help combat the decline.