Union Pacific Corporation (NYSE:UNP) today reported 2020 fourth-quarter net income of $1.4 billion, or $2.05 per diluted share. These results include a previously announced $278 million pre-tax, non-cash impairment charge. Excluding the effects of that charge, adjusted fourth quarter net income was $1.6 billion, or $2.36 per diluted share. This compares to $1.4 billion, or $2.02 per diluted share, in the fourth quarter 2019.
"These outstanding results demonstrate the true potential of our franchise as we leveraged all three profitability drivers simultaneously – volume growth, productivity, and pricing – to produce record fourth quarter results," said CEO Lance Fritz. "The women and men of Union Pacific persevered throughout the pandemic to provide our customers with a safe, reliable, and consistent service product."
Operating revenue of $5.1 billion was down 1% in fourth quarter 2020 compared to fourth quarter 2019. Fourth-quarter business volumes, as measured by total revenue carloads, increased 3% compared to 2019. Premium volumes increased compared to 2019, while bulk was flat and industrial declined.
In addition, quarterly freight revenue declined 1% compared to fourth quarter 2019, as volume growth and core pricing gains were more than offset by decreased fuel surcharge revenue and a less favorable business mix.
Union Pacific's 61.0% reported operating ratio when adjusted for the impairment charge is an all-time quarterly record of 55.6%, 410 basis points lower than fourth quarter 2019. Lower fuel prices positively impacted the operating ratio by 90 basis points.
UNP shares began Thursday down $7.65, or 3.5%, to $210.53.
