UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 21, 2010 (January 21, 2010)
Union Pacific Corporation
(Exact name of registrant as specified in its charter)
| Utah | 1-6075 | 13-2626465 | ||
| (State or other jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) | ||
| 1400 Douglas Street, Omaha, Nebraska | 68179 | |||
| (Address of principal executive offices) |
(Zip Code) | |||
(Registrant’s telephone number, including area code): (402) 544-5000
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On January 21, 2010, Union Pacific Corporation issued a press release announcing its financial results for the quarter and year ended December 31, 2009. A copy of the press release is furnished herewith as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
| (c) | Exhibits. |
| 99.1 | Press Release of Union Pacific Corporation, dated January 21, 2010, announcing its financial results for the quarter and year ended December 31, 2009. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: January 21, 2010
| UNION PACIFIC CORPORATION | ||
| By: | /s/ Robert M. Knight, Jr. | |
| Robert M. Knight, Jr. | ||
| Executive Vice President – Finance and Chief Financial Officer | ||
Exhibit Index
| 99.1 | Press Release of Union Pacific Corporation, dated January 21, 2010 |
Exhibit 99.1
UNION PACIFIC REPORTS FOURTH QUARTER EARNINGS
Record 2009 Operating Ratio
FOR IMMEDIATE RELEASE
Fourth Quarter 2009 Highlights
| • | Operating income totaled $1 billion, down 12 percent. |
| • | Net income down 17 percent to $551 million. |
| • | Operating ratio was 73.3 percent, a new quarterly record versus 73.4 percent in 2008. |
| • | Customer Satisfaction Index of 88 ties a quarterly best, up 3 points. |
Full Year 2009 Highlights
| • | Operating income totaled $3.4 billion, down 17 percent. |
| • | Net income down 19 percent to $1.9 billion. |
| • | Operating ratio was a record 76 percent, a 1.3 point improvement. |
| • | Customer Satisfaction Index, up 5 points, set a record at 88. |
Omaha, Neb., January 21, 2010 – Union Pacific Corporation (NYSE: UNP) today reported 2009 fourth quarter net income of $551 million, or $1.08 per diluted share, compared to $661 million, or $1.31 per diluted share in the fourth quarter 2008.
“Union Pacific’s fourth quarter earnings reflected the continued impact of the recession that began in 2008,” said Jim Young, Union Pacific chairman and chief executive officer. “In this difficult environment, we’ve continued to focus on running our business efficiently and improving customer service. As a result, we finished the year with new records in safety, service, customer satisfaction and efficiency.”
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Fourth Quarter Summary
Slightly stronger fourth quarter demand led to an increase over soft prior year volume levels in three of Union Pacific’s six business groups: Intermodal, Agricultural and Automotive. Fourth quarter 2009 operating revenues totaled $3.8 billion versus $4.3 billion in the fourth quarter 2008. In addition:
| • | Business volumes, as measured by total revenue carloads, were down 5 percent versus the fourth quarter 2008. Year-over-year freight revenues declined 13 percent to $3.5 billion in the fourth quarter 2009 as a result of lower volumes and a $320 million reduction in fuel surcharge revenue. |
| • | Quarterly diesel fuel prices decreased 17 percent from an average of $2.46 per gallon in the fourth quarter 2008 to an average of $2.05 per gallon. |
| • | Union Pacific’s operating ratio improved to 73.3 percent from 73.4 percent in 2008, the fourth consecutive year of fourth quarter records, primarily due to ongoing efficiency initiatives and pricing gains that offset the impact of lower volumes. |
| • | The Company’s Customer Satisfaction Index of 88 improved 3 points and ties a quarterly best. |
| • | Quarterly train speed, as reported to the Association of American Railroads, was 27.0 mph, up 1.9 mph or 8 percent versus the fourth quarter 2008. This improvement reflected continued productivity and operational improvements, as well as the impact of lower volumes. |
Summary of Fourth Quarter Freight Revenues
| • | Automotive was down 1 percent. |
| • | Intermodal was down 3 percent. |
| • | Agricultural was down 7 percent. |
| • | Chemicals was down 7 percent. |
| • | Energy was down 22 percent. |
| • | Industrial Products was down 28 percent. |
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2009 Full Year Summary
For the full year 2009, Union Pacific reported net income of $1.9 billion or $3.75 per diluted share. This compares to $2.3 billion or $4.54 per diluted share in 2008. The Company’s 2009 operating revenue totaled $14.1 billion, compared to $18 billion in 2008. Operating income decreased 17 percent from 2008 to $3.4 billion.
| • | Business volumes were down 16 percent versus 2008. |
| • | Freight revenues declined 22 percent to $13.4 billion in 2009 as a result of lower volumes and a $1.7 billion reduction in fuel surcharge revenue versus 2008. |
| • | Average diesel fuel price per gallon decreased 44 percent from $3.15 to $1.75. |
Outlook
“Although still uncertain, the economic picture for 2010 looks somewhat more favorable than it did a year ago,” Young said. “We will continue executing Union Pacific’s long-term strategy to improve safety, customer service, productivity and efficiency. Our network management initiatives and strategic growth investments should position us to take full advantage of new business opportunities. The new safety and service records set in 2009 give customers increasing confidence that UP will serve their business needs in a safe, timely and efficient manner. As volumes return, these efforts provide us with opportunities to generate significant margin leverage and strong financial returns for our shareholders.”
About Union Pacific
Union Pacific Corporation owns one of America’s leading transportation companies. Its principal operating company, Union Pacific Railroad, links 23 states in the western two-thirds of the country. Union Pacific serves many of the fastest-growing U.S. population centers and provides Americans with a fuel-efficient, environmentally responsible and safe mode of freight transportation. Union Pacific’s diversified business mix includes Agricultural Products, Automotive, Chemicals, Energy, Industrial Products and Intermodal. The railroad emphasizes excellent customer service and offers competitive routes from all major West Coast and Gulf Coast ports to eastern gateways. Union Pacific connects with Canada’s rail systems and is the only railroad serving all six major gateways to Mexico, making it North America’s premier rail franchise.
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Supplemental financial information is attached.
Investor contact is Jennifer Hamann, (402) 544-4227.
Media contact is Donna Kush, (402), 544-3753.
****
This press release and related materials contain statements about the Corporation’s future that are not statements of historical fact, including specifically the Corporation’s outlook regarding economic conditions, future productivity, future safety and operating performance, the success and outcome of network management initiatives and strategic investments, competitiveness and quality of service, and its ability to generate financial returns and significant margin leverage and take advantage of new business opportunities. These statements are, or will be, forward-looking statements as defined by the Securities Act of 1933 and the Securities Exchange Act of 1934. Forward-looking statements also generally include, without limitation, information or statements regarding: projections, predictions, expectations, estimates or forecasts as to the Corporation’s and its subsidiaries’ business, financial, and operational results, and future economic performance; and management’s beliefs, expectations, goals, and objectives and other similar expressions concerning matters that are not historical facts.
Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times that, or by which, such performance or results will be achieved. Forward-looking information, including expectations regarding operational and financial improvements and the Corporation’s future performance or results are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statement. Important factors, including risk factors, could affect the Corporation’s and its subsidiaries’ future results and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements. Information regarding risk factors and other cautionary information are available in the Corporation’s Annual Report on Form 10-K for 2008, which was filed with the SEC on February 6, 2009. The Corporation updates information regarding risk factors if circumstances require such updates in its periodic reports on Form 10-Q and its subsequent Annual Reports on Form 10-K (or such other reports that may be filed with the SEC).
Forward-looking statements speak only as of, and are based only upon information available on, the date the statements were made. The Corporation assumes no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. If the Corporation does update one or more forward-looking statements, no inference should be drawn that the Corporation will make additional updates with respect thereto or with respect to other forward-looking statements. References to our Web site are provided for convenience and, therefore, information on or available through the Web site is not, and should not be deemed to be, incorporated by reference herein.
###
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES
Condensed Consolidated Statements of Income (unaudited)
| Millions, Except Per Share Amounts, For the Periods Ended December 31, |
4th Quarter | Full Year | ||||||||||||
| 2009 | 2008 | % | 2009 | 2008 | % | |||||||||
| Operating Revenues |
||||||||||||||
| Freight revenues |
$ 3,541 | $ 4,080 | (13)% | $ 13,373 | $ 17,118 | (22)% | ||||||||
| Other revenues |
213 | 206 | 3 | 770 | 852 | (10) | ||||||||
| Total operating revenues |
3,754 | 4,286 | (12) | 14,143 | 17,970 | (21) | ||||||||
| Operating Expenses |
||||||||||||||
| Compensation and benefits |
1,018 | 1,101 | (8) | 4,063 | 4,457 | (9) | ||||||||
| Fuel |
541 | 732 | (26) | 1,763 | 3,983 | (56) | ||||||||
| Purchased services and materials |
421 | 458 | (8) | 1,614 | 1,902 | (15) | ||||||||
| Depreciation |
377 | 353 | 7 | 1,444 | 1,387 | 4 | ||||||||
| Equipment and other rents |
266 | 320 | (17) | 1,180 | 1,326 | (11) | ||||||||
| Other |
129 | 181 | (29) | 687 | 840 | (18) | ||||||||
| Total operating expenses |
2,752 | 3,145 | (12) | 10,751 | 13,895 | (23) | ||||||||
| Operating Income |
1,002 | 1,141 | (12) | 3,392 | 4,075 | (17) | ||||||||
| Other income |
23 | 25 | (8) | 195 | 92 | F | ||||||||
| Interest expense |
(153) | (127) | 20 | (600) | (511) | 17 | ||||||||
| Income before income taxes |
872 | 1,039 | (16) | 2,987 | 3,656 | (18) | ||||||||
| Income taxes |
(321) | (378) | (15) | (1,089) | (1,318) | (17) | ||||||||
| Net Income |
$ 551 | $ 661 | (17)% | $ 1,898 | $ 2,338 | (19)% | ||||||||
| Share and Per Share |
||||||||||||||
| Earnings per share - basic |
$ 1.09 | $ 1.31 | (17)% | $ 3.77 | $ 4.58 | (18)% | ||||||||
| Earnings per share - diluted |
$ 1.08 | $ 1.31 | (18) | $ 3.75 | $ 4.54 | (17) | ||||||||
| Weighted average number of shares - basic |
503.5 | 503.2 | - | 503.0 | 510.6 | (1) | ||||||||
| Weighted average number of shares - diluted |
507.8 | 506.5 | - | 505.8 | 515.0 | (2) | ||||||||
| Dividends declared per share |
$ 0.27 | $ 0.27 | - | $ 1.08 | $ 0.98 | 10 | ||||||||
| Operating Ratio |
73.3% | 73.4% | (0.1) pts | 76.0% | 77.3% | (1.3) pts | ||||||||
| Effective Tax Rate |
36.8% | 36.4% | 0.4 pts | 36.5% | 36.1% | 0.4 pts | ||||||||
1
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES
Freight Revenues Statistics (unaudited)
| 4th Quarter | Full Year | |||||||||||||
| For the Periods Ending December 31, | 2009 | 2008 | % | 2009 | 2008 | % | ||||||||
| Freight Revenues (Millions) |
||||||||||||||
| Agricultural |
$ 738 | $ 792 | (7)% | $ 2,666 | $ 3,174 | (16)% | ||||||||
| Automotive |
302 | 305 | (1) | 854 | 1,344 | (36) | ||||||||
| Chemicals |
539 | 578 | (7) | 2,102 | 2,494 | (16) | ||||||||
| Energy |
765 | 983 | (22) | 3,118 | 3,810 | (18) | ||||||||
| Industrial Products |
513 | 717 | (28) | 2,147 | 3,273 | (34) | ||||||||
| Intermodal |
684 | 705 | (3) | 2,486 | 3,023 | (18) | ||||||||
| Total |
$ 3,541 | $ 4,080 | (13)% | $ 13,373 | $ 17,118 | (22)% | ||||||||
| Revenue Carloads (Thousands) |
||||||||||||||
| Agricultural |
235 | 228 | 3 % | 865 | 947 | (9)% | ||||||||
| Automotive |
151 | 150 | 1 | 465 | 667 | (30) | ||||||||
| Chemicals |
191 | 195 | (2) | 761 | 885 | (14) | ||||||||
| Energy |
499 | 590 | (15) | 2,021 | 2,348 | (14) | ||||||||
| Industrial Products |
213 | 270 | (21) | 899 | 1,249 | (28) | ||||||||
| Intermodal |
763 | 724 | 5 | 2,775 | 3,165 | (12) | ||||||||
| Total |
2,052 | 2,157 | (5)% | 7,786 | 9,261 | (16)% | ||||||||
| Average Revenue per Car |
||||||||||||||
| Agricultural |
$ 3,129 | $ 3,472 | (10)% | $ 3,080 | $ 3,352 | (8)% | ||||||||
| Automotive |
2,004 | 2,040 | (2) | 1,838 | 2,017 | (9) | ||||||||
| Chemicals |
2,815 | 2,957 | (5) | 2,761 | 2,818 | (2) | ||||||||
| Energy |
1,536 | 1,664 | (8) | 1,543 | 1,622 | (5) | ||||||||
| Industrial Products |
2,412 | 2,662 | (9) | 2,388 | 2,620 | (9) | ||||||||
| Intermodal |
896 | 974 | (8) | 896 | 955 | (6) | ||||||||
| Average |
$ 1,726 | $ 1,891 | (9)% | $ 1,718 | $ 1,848 | (7)% | ||||||||
2
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES
Condensed Consolidated Statements of Financial Position (unaudited)
| Dec. 31, | Dec. 31, | |||
| Millions of Dollars, Except Percentages | 2009 | 2008 | ||
| Assets |
||||
| Cash and cash equivalents |
$ 1,850 | $ 1,249 | ||
| Other current assets |
1,830 | 1,564 | ||
| Investments |
1,036 | 974 | ||
| Net properties |
37,428 | 35,701 | ||
| Other assets |
266 | 234 | ||
| Total assets |
$ 42,410 | $ 39,722 | ||
| Liabilities and Common Shareholders’ Equity |
||||
| Debt due within one year |
$ 212 | $ 320 | ||
| Other current liabilities |
2,470 | 2,560 | ||
| Debt due after one year |
9,636 | 8,607 | ||
| Deferred income taxes |
11,130 | 10,282 | ||
| Other long-term liabilities |
2,021 | 2,506 | ||
| Total liabilities |
25,469 | 24,275 | ||
| Total common shareholders’ equity |
16,941 | 15,447 | ||
| Total liabilities and common shareholders’ equity |
$ 42,410 | $ 39,722 | ||
| Debt to Capital |
36.8% | 36.6% | ||
| Adjusted Debt to Capital* |
45.9% | 47.4% | ||
| Return on Invested Capital* |
8.2% | 10.2% | ||
| * | Adjusted Debt to Capital and Return on Invested Capital are non-GAAP measures; however, we believe that they are important in evaluating our financial performance. See pages 8 and 9 for a reconciliation to GAAP. |
3
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES
Condensed Consolidated Statements of Cash Flows (unaudited)
| Millions of Dollars, For the Periods Ending December 31, |
Full Year | |||||
| 2009 | 2008 | |||||
| Operating Activities |
||||||
| Net income |
$ 1,898 | $ 2,338 | ||||
| Depreciation |
1,444 | 1,387 | ||||
| Deferred income taxes |
723 | 547 | ||||
| Other - net |
(831 | ) | (202 | ) | ||
| Cash provided by operating activities |
3,234 | 4,070 | ||||
| Investing Activities |
||||||
| Capital investments |
(2,384 | ) | (2,780 | ) | ||
| Other - net |
209 | 16 | ||||
| Cash used in investing activities |
(2,175 | ) | (2,764 | ) | ||
| Financing Activities |
||||||
| Debt issued |
843 | 2,257 | ||||
| Common shares repurchased |
- | (1,609 | ) | |||
| Debt repaid |
(871 | ) | (1,208 | ) | ||
| Dividends paid |
(544 | ) | (481 | ) | ||
| Other - net |
114 | 106 | ||||
| Cash used in financing activities |
(458 | ) | (935 | ) | ||
| Net Change in Cash and Cash Equivalents |
601 | 371 | ||||
| Cash and cash equivalents at beginning of year |
1,249 | 878 | ||||
| Cash and Cash Equivalents End of Year |
$ 1,850 | $ 1,249 | ||||
| Free Cash Flow* |
||||||
| Cash provided by operating activities |
$ 3,234 | $ 4,070 | ||||
| Cash used in investing activities |
(2,175 | ) | (2,764 | ) | ||
| Dividends paid |
(544 | ) | (481 | ) | ||
| Free cash flow |
$ 515 | $ 825 | ||||
| * | Free cash flow is a non-GAAP measure; however, we believe that it is important in evaluating our financial performance and measures our ability to generate cash without additional external financings. |
4
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES
Operating and Performance Statistics (unaudited)
| 4th Quarter | Full Year | |||||||||||||
| For the Periods Ending December 31, | 2009 | 2008 | % | 2009 | 2008 | % | ||||||||
| Operating/Performance Statistics |
||||||||||||||
| Gross ton-miles (GTMs) (millions) |
220,231 | 243,641 | (10)% | 846,473 | 1,020,370 | (17)% | ||||||||
| Employees (average) |
42,157 | 46,877 | (10) | 43,531 | 48,242 | (10) | ||||||||
| GTMs (millions) per employee |
5.22 | 5.20 | - | 19.44 | 21.15 | (8) | ||||||||
| Customer satisfaction index |
88 | 85 | 3 pts | 88 | 83 | 5 pts | ||||||||
| Locomotive Fuel Statistics |
||||||||||||||
| Average fuel price per gallon consumed |
$ 2.05 | $ 2.46 | (17)% | $ 1.75 | $ 3.15 | (44)% | ||||||||
| Fuel consumed in gallons (millions) |
256 | 289 | (11) | 979 | 1,229 | (20) | ||||||||
| Fuel consumption rate* |
1.162 | 1.188 | (2) | 1.156 | 1.204 | (4) | ||||||||
| AAR Reported Performance Measures |
||||||||||||||
| Average train speed (miles per hour) |
27.0 | 25.1 | 8 % | 27.3 | 23.5 | 16 % | ||||||||
| Average terminal dwell time (hours) |
25.8 | 25.3 | 2 | 24.8 | 24.9 | - | ||||||||
| Average rail car inventory (thousands) |
282.8 | 292.9 | (3) | 283.1 | 300.7 | (6) | ||||||||
| Revenue Ton-Miles (Millions) |
||||||||||||||
| Agricultural |
22,723 | 21,560 | 5 % | 81,207 | 88,588 | (8)% | ||||||||
| Automotive |
3,174 | 3,169 | - | 9,740 | 13,982 | (30) | ||||||||
| Chemicals |
12,031 | 12,641 | (5) | 48,055 | 54,807 | (12) | ||||||||
| Energy |
54,093 | 65,393 | (17) | 218,227 | 258,362 | (16) | ||||||||
| Industrial Products |
12,429 | 15,421 | (19) | 51,873 | 70,714 | (27) | ||||||||
| Intermodal |
19,077 | 17,014 | 12 | 70,086 | 76,178 | (8) | ||||||||
| Total |
123,527 | 135,198 | (9)% | 479,188 | 562,631 | (15)% | ||||||||
| * | Fuel consumption is computed as follows: gallons of fuel consumed divided by gross ton-miles in thousands. |
5
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES
Condensed Consolidated Statements of Income (unaudited)
| 2009 | ||||||||||
| In Millions, Except per Share Amounts and Percentages | 1st Qtr | 2nd Qtr | 3rd Qtr | 4th Qtr | Full Year | |||||
| Operating Revenues |
||||||||||
| Freight revenues |
$ 3,240 | $ 3,121 | $ 3,471 | $ 3,541 | $ 13,373 | |||||
| Other revenues |
175 | 182 | 200 | 213 | 770 | |||||
| Total operating revenues |
3,415 | 3,303 | 3,671 | 3,754 | 14,143 | |||||
| Operating Expenses |
||||||||||
| Compensation and benefits |
1,070 | 976 | 999 | 1,018 | 4,063 | |||||
| Fuel |
386 | 370 | 466 | 541 | 1,763 | |||||
| Purchased services and materials |
399 | 391 | 403 | 421 | 1,614 | |||||
| Depreciation |
345 | 355 | 367 | 377 | 1,444 | |||||
| Equipment and other rents |
317 | 307 | 290 | 266 | 1,180 | |||||
| Other |
226 | 153 | 179 | 129 | 687 | |||||
| Total operating expenses |
2,743 | 2,552 | 2,704 | 2,752 | 10,751 | |||||
| Operating Income |
672 | 751 | 967 | 1,002 | 3,392 | |||||
| Other income |
23 | 135 | 14 | 23 | 195 | |||||
| Interest expense |
(141) | (150) | (156) | (153) | (600) | |||||
| Income before income taxes |
554 | 736 | 825 | 872 | 2,987 | |||||
| Income tax expense |
(192) | (268) | (308) | (321) | (1,089) | |||||
| Net Income |
$ 362 | $ 468 | $ 517 | $ 551 | $ 1,898 | |||||
| Share and Per Share |
||||||||||
| Earnings per share - basic |
$ 0.72 | $ 0.93 | $ 1.03 | $ 1.09 | $ 3.77 | |||||
| Earnings per share - diluted |
$ 0.72 | $ 0.92 | $ 1.02 | $ 1.08 | $ 3.75 | |||||
| Weighted average number of shares - basic |
502.7 | 502.9 | 503.1 | 503.5 | 503.0 | |||||
| Weighted average number of shares - diluted |
504.6 | 505.3 | 507.0 | 507.8 | 505.8 | |||||
| Dividends declared per share |
$ 0.27 | $ 0.27 | $ 0.27 | $ 0.27 | $ 1.08 | |||||
| Operating Ratio |
80.3% | 77.3% | 73.7% | 73.3% | 76.0% | |||||
| Effective Tax Rate |
34.7% | 36.4% | 37.3% | 36.8% | 36.5% | |||||
6
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES
Freight Revenues Statistics (unaudited)
| 2009 | ||||||||||
| 1st Qtr | 2nd Qtr | 3rd Qtr | 4th Qtr | Full Year | ||||||
| Freight Revenues (Millions) |
||||||||||
| Agricultural |
$ 661 | $ 618 | $ 649 | $ 738 | $ 2,666 | |||||
| Automotive |
162 | 163 | 227 | 302 | 854 | |||||
| Chemicals |
513 | 499 | 551 | 539 | 2,102 | |||||
| Energy |
807 | 715 | 831 | 765 | 3,118 | |||||
| Industrial Products |
546 | 531 | 557 | 513 | 2,147 | |||||
| Intermodal |
551 | 595 | 656 | 684 | 2,486 | |||||
| Total |
$ 3,240 | $ 3,121 | $ 3,471 | $ 3,541 | $ 13,373 | |||||
| Revenue Carloads (Thousands) |
||||||||||
| Agricultural |
212 | 203 | 215 | 235 | 865 | |||||
| Automotive |
97 | 93 | 124 | 151 | 465 | |||||
| Chemicals |
180 | 188 | 202 | 191 | 761 | |||||
| Energy |
521 | 470 | 531 | 499 | 2,021 | |||||
| Industrial Products |
222 | 229 | 235 | 213 | 899 | |||||
| Intermodal |
615 | 669 | 728 | 763 | 2,775 | |||||
| Total |
1,847 | 1,852 | 2,035 | 2,052 | 7,786 | |||||
| Average Revenue per Car |
||||||||||
| Agricultural |
$ 3,116 | $ 3,045 | $ 3,026 | $ 3,129 | $ 3,080 | |||||
| Automotive |
1,675 | 1,755 | 1,827 | 2,004 | 1,838 | |||||
| Chemicals |
2,843 | 2,659 | 2,730 | 2,815 | 2,761 | |||||
| Energy |
1,550 | 1,520 | 1,564 | 1,536 | 1,543 | |||||
| Industrial Products |
2,459 | 2,319 | 2,367 | 2,412 | 2,388 | |||||
| Intermodal |
897 | 889 | 901 | 896 | 896 | |||||
| Average |
$ 1,755 | $ 1,685 | $ 1,706 | $ 1,726 | $ 1,718 | |||||
7
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES
| Debt / Capital, Reconciliation to GAAP* | ||||
| Dec. 31, | Dec. 31, | |||
| Millions of Dollars, Except Percentages | 2009 | 2008 | ||
| Debt (a) |
$ 9,848 | $ 8,927 | ||
| Equity |
16,941 | 15,447 | ||
| Capital (b) |
$ 26,789 | $ 24,374 | ||
| Debt to capital (a/b) |
36.8% | 36.6% |
| * | Total debt divided by total debt plus equity. Management believes this is an important measure in evaluating our balance sheet strength and is important in managing our credit ratios and financing relationships. |
| Adjusted Debt / Capital, Reconciliation to GAAP* | ||||
| Dec. 31, | Dec. 31, | |||
| Millions of Dollars, Except Percentages | 2009 | 2008 | ||
| Debt |
$ 9,848 | $ 8,927 | ||
| Net present value of operating leases |
3,672 | 3,690 | ||
| Value of sold receivables |
400 | 584 | ||
| Unfunded pension and OPEB |
456 | 733 | ||
| Adjusted debt (a) |
$ 14,376 | $ 13,934 | ||
| Equity |
16,941 | 15,447 | ||
| Adjusted capital (b) |
$ 31,317 | $ 29,381 | ||
| Adjusted debt to capital (a/b) |
45.9% | 47.4% | ||
| * | Total debt plus net present value of operating leases plus value of sold receivables plus after-tax unfunded pension and OPEB obligation divided by total debt plus net present value of operating leases plus value of sold receivables plus after-tax unfunded pension and OPEB obligation plus equity. Operating leases were discounted using 6.3% at December 31, 2009 and 8.0% at December 31, 2008, respectively. The lower discount rate reflects changes to interest rates and our current financing costs. Management believes this is an important measure in evaluating the total amount of leverage in our capital structure including off-balance sheet obligations. |
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| Return on Invested Capital as Adjusted (ROIC)* | ||||
| Dec. 31, | Dec. 31, | |||
| Millions of Dollars, Except Percentages | 2009 | 2008 | ||
| Net income |
$ 1,898 | $ 2,338 | ||
| Add: Interest expense |
600 | 511 | ||
| Add: Sale of receivables fees |
9 | 23 | ||
| Add: Interest on present value of operating leases |
232 | 299 | ||
| Less: Taxes on interest and fees |
(307) | (301) | ||
| Net operating profit after taxes as adjusted (a) |
$ 2,432 | $ 2,870 | ||
| Average equity |
$ 16,194 | $ 15,516 | ||
| Add: Average debt |
9,388 | 8,305 | ||
| Add: Average value of sold receivables |
492 | 592 | ||
| Add: Average present value of operating leases |
3,681 | 3,737 | ||
| Average invested capital as adjusted (b) |
$ 29,755 | $ 28,150 | ||
| Return on invested capital as adjusted (a/b) |
8.2% | 10.2% |
| * | ROIC is considered a non-GAAP financial measure by SEC Regulation G and Item 10 of SEC Regulation S-K, and may not be defined and calculated by other companies in the same manner. We believe this measure is important in evaluating the efficiency and effectiveness of the Corporation’s long-term capital investments, and we currently use ROIC as a performance criteria in determining certain elements of equity compensation for our executives. ROIC should be considered in addition to, rather than as a substitute for, other information provided in accordance with GAAP. The most comparable GAAP measure is Return on Average Common Shareholders’ Equity. |
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