Union Pacific’s Q3 2016 Earnings Review: Lower Shipments And Fuel Surcharge Revenue Weigh On Results
Union Pacific reported a 9% year-over-year decline in its Q3 earnings per share, with top line headwinds translating into lower profits. A decline in shipment volumes and fuel surcharge revenue negatively impacted the company’s overall revenue, with lower operating expenses partially offsetting the impact of lower revenue on the company’s profits. A decline in Union Pacific’s coal shipments, with low natural gas prices negatively impacting the demand for coal from utilities, drove the overall decline in the company’s shipment volumes. In addition, lower fuel surcharge revenue due to a decline in fuel prices, also contributed to the decline in the company’s top line. Though lower volume-related operating expenses (including fuel expenses) and Union Pacific’s cost reduction initiatives partially offset the impact of lower revenue on the company’s operating profits, the net impact was a 180 basis points deterioration in the company’s operational ratio.
Have more questions about Union Pacific? See the links below.
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