Union Pacific Corp. said Thursday that third-quarter profit fell 5 percent on lower demand for freight hauling.
The Omaha-based railroad said net income was $1.3 billion, or $1.50 a share, down from $1.37 billion, or $1.53 a share, a year earlier. The earnings per share beat the average Wall Street analyst estimate of $1.43.
Freight volumes fell about 6 percent, the company said in a statement, and revenue dropped 10 percent to $5.6 billion. Shipments at the employer of about 8,000 Nebraskans dropped in five of the six major freight categories, with finished vehicles and vehicle parts the only gainer.
“We were faced with relatively weak demand, and our team worked hard to get our resources right and generate excellent service,” Chief Executive Lance Fritz said in an interview.
Shares of Union Pacific were up about 3 percent by late morning in trading on the New York Stock Exchange.
Coal volumes were down 15 percent in the quarter, as U.S. utilities increasingly shift to cheaper natural gas. Revenue generated from the major freight categories was:
» Automotive, little changed.
» Agricultural products, down 4 percent.
» Chemicals, down 6 percent.
» Intermodal, down 11 percent.
» Industrial products, down 16 percent.
» Coal, down 18 percent.
Union Pacific also said Thursday that about 2,700 hourly workers on trains, engines and yards are on temporary layoff, up from 2,300 in September. The company said earlier this year it also expected to cut several hundred management positions this year via terminations and attrition.
“This is about what I expected,” said Logan Purk, a transportation industry analyst at wealth adviser Edward Jones. “Tough sales and volume numbers, but solid cost control.”
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