Union Pacific Corporation · NYSE:UNP
Union Pacific — BB&T Transportation Services Conference 2012
10 slides from Union Pacific's conference presentation, Feb 15, 2012
Slide 1: BB&T Transportation Services Conference
BB&T Transportation Services Conference February 15, 2012 Rob Knight, CFO 1 Cautionary Information This presentation and related materials contain statements about the Corporation’s future that are not statements of historical fact, including specifically the Corporation’s outlook regarding: economi
Slide 2: Union Pacific Achieves 2011 Milestones
Union Pacific Achieves 2011 Milestones Earnings Per Share • Record Highlights – Safety & Service +22% $6.72 7-Day – Operating Income 190 Volume (000s) – Earnings $5.53 177 – Free Cash Flow* – ROIC* – Customer Satisfaction $3.44 • Investing for Growth and Returns • Increased Shareholder Value 2007 20
Slide 3: 2011 Business Levels; 2012 Volume Growth Potential
2011 Business Levels 7-Day Monthly Carloadings Volume Growth (000s) 210 Chemicals +9% 200 2006 Automotive +7% @192 190 Industrial +7% 2011 Products 180 @177 Energy +5% 170 2010 @172 Agricultural +2% 160 2009 @152 Units (excl Intermodal) +6% 150 140 Intermodal -2% January December TOTAL +3% 5 2012 Vo
Slide 4: Intermodal Trends; Coal Trends
Intermodal Trends UP Intermodal Volumes Domestic & International (7 Day) (Year-over-Year Volume Growth ) 74,000 6% 2% 3% 1% 0% 2010 66,000 -2% 2012* Domestic 2011 -7% International 2009 -12% 58,000 1Q11 2Q11 3Q11 4Q11 50,000 + Solid Domestic Volumes & Highway Conversions 42,000 ‒ Sluggish Internatio
Slide 5: Global Demand for Energy
Global Demand for Energy Diverse Opportunities for UP, over $6 Billion in 2011 Energy Sources • Coal • Petroleum/LPG • Oil Sands, Shale • Ethanol • Wind Related Markets • Frac Sand • Minerals • Pipe • Other Materials 9 Global Demand for Energy Originating Railroads UP Route (Crude) Integrated Strate
Slide 6: Mexico Opportunities; Pricing Gains and Opportunities
Mexico Opportunities Freight Revenue FY 2011 of $1.8B Calexico Energy Industrial 1% 19% Nogales El Paso Agricultural Intermodal 26% 11% Chemicals Hermosillo Eagle Pass 9% Chihuahua Automotive 34% Laredo Monclova Brownsville Torreón Saltillo Monterrey Culiacán • Growing Population • Faster Economic R
Slide 7: Operating Ratio Trend; Investments and Returns
Operating Ratio Trend Operating Ratio (Percent) 81.6 79.3 77.4 Targeting a 65% to 67% 76.1 Full Year Operating Ratio by 2015 192 70.6 70.7 190 Fuel Price 65 - 67 180 177 172 152 11 point improvement from 2006 to 2011 2006 2007 2008 2009 2010 2011 2015E 7-Day Volume (000s) 13 Investments and Returns
Slide 8: Strong Capital Investments Creating Capacity; Strong Financial Position
Strong Capital Investments Creating Capacity Spending on Infrastructure Top 10 State Highway Agencies vs. Railroads 1. California 2. Texas 3. Florida 4. Pennsylvania BNSF Union Pacific 5. New York 6. Illinois 7. Louisiana 8. North Carolina Norfolk Southern CSX 9. Washington 10. Michigan Data include
Slide 9: Delivering Value to Shareholders; Total Shareholder Return
Delivering Value to Shareholders Cash To Shareholders (Cumulative) (Dividends + Share Repurchases, in Billions) • Record $1.9 Billion $8.5 Free Cash Flow – Declared Dividend $6.2 Increase of 58% in 2011 • 30% Targeted Dividend Payout Ratio $4.4 $3.8 – $1.4 Billion in Share Repurchases in 2011 $1.7 •
Slide 10: Leveraging the Strength of the UP Franchise; Q&A
Leveraging the Strength of the UP Franchise • Macro Demand Drivers • Highway Conversions • Food Production • International Markets • Energy Consumption • Value Proposition • Franchise Strength & Diversity • Service / Price • Continued Productivity • Growth Capital Investment • Shareholder Returns 19
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