Union Pacific Corporation · NYSE:UNP
Union Pacific — Q3 2022 Earnings Presentation
13 slides from Union Pacific's earnings presentation, Oct 20, 2022
Slide 1: Third Quarter 2022 Earnings Release
THIRD QUARTER 2022 EARNINGS RELEASE Lance Fritz, Chairman, President, & CEO October 20, 2022 Third Quarter 2022 Results Earnings Per Share Operating Ratio $3.05 $3.19 $2.57 24% 59.9% 19% vs 2021 58.2% vs 2021 56.3% 3.6 pts vs 2021 1.9 pts vs 2021 2021 2022 2022 2021 2022 2022 Reported Adjusted* Repo
Slide 2: Marketing & Sales Review: Bulk
THIRD QUARTER 2022 MARKETING & SALES REVIEW Kenny Rocker Executive Vice President – Marketing & Sales 3 THIRD QUARTER 2022 Bulk Revenue $1,959 (+16%) Volume 532K (+2%) ARC $3,685 (+14%) Major Markets Coal & Renewables Grain & Fertilizer Food & Grain Products Refrigerated 232 243 +5% 185 190 +3% 55 5
Slide 3: Industrial and Premium
THIRD QUARTER 2022 Industrial Revenue $2,194 (+15%) Volume 569K (+4%) ARC $3,852 (+11%) Major Markets Energy & Specialized Forest Products Industrial Chemicals Metals & Minerals & Plastics 188 202 153 165 145 140 +7% +8% -3% 63 62 -2% 3Q 2021 3Q 2022 3Q 2021 3Q 2022 3Q 2021 3Q 2022 3Q 2021 3Q 2022 Q
Slide 4: Fourth Quarter 2022 Volume Outlook
Fourth Quarter 2022 Volume Outlook Bulk Industrial Premium Biofuels Industrial Production Domestic Intermodal Coal Forest Products International Intermodal Grain Construction Materials Automotive 7 THIRD QUARTER 2022 OPERATIONS REVIEW Eric Gehringer Executive Vice President – Operating 8
Slide 5: Safety Culture Demonstrating Results; Improving Crew Availability
Safety Culture Demonstrating Results Year to Date Safety Performance Employee (Reportable Personal Injury Incidents Per 200,000 Employee-Hours) -20% 1.00 0.80 2021 2022 Derailments (Reportable Derailment Incidents Per Million Train Miles) +2% 2.82 2.89 2021 2022 9 Improving Crew Availability Drives
Slide 6: Key Performance Metrics
THIRD QUARTER 2022 Key Performance Metrics FREIGHT CAR VELOCITY INTERMODAL TRIP PLAN MANIFEST/AUTO (Daily Miles per Car) COMPLIANCE TRIP PLAN COMPLIANCE (% of Boxes On Time) (% of Cars On Time) 195 191 66 62 60 58 3Q 2021 3Q 2022 3Q 2021 3Q 2022 3Q 2021 3Q 2022 2Q 2022: 187 2Q 2022: 62 2Q 2022: 56 Q
Slide 7: Operating Outlook
Operating Outlook • Execution of PSR Principles – Resource Utilization – Volume Leverage • Improve Operational Performance While Handling Increased Volumes • Recover Lost Productivity and Remove Excess Costs From the Network 13 THIRD QUARTER 2022 FINANCIAL REVIEW Jennifer Hamann Executive Vice Presi
Slide 8: Third Quarter Operating Ratio and EPS; Income Statement
Third Quarter Operating Ratio and EPS Favorable / (Unfavorable) Operating Ratio EPS Third Quarter 2021 ( 56.3% ($2.57 Labor Accrual Adjustments* (1.7) pts ($0.14) Core Results (3.1) pts $0.20 Fuel Price (net) 0.7 pts ( $0.37 2021 Wildfire and Weather 0.5)pts ( $0.05 Third Quarter 2022 ( 59.9% ($3.05
Slide 9: Freight Revenue Growth Drivers; Inflation and Network Inefficiencies Impact Costs
Freight Revenue Growth Drivers $ in Millions 18.25% $104 $6,109 $670 $169 $5,166 Volume Fuel Surcharge Price/Mix 3.25% 13.00% 2.00% 163 157 3Q 3Q 2021 2022 17 7 Day Volume (000s) Inflation and Network Inefficiencies Impact Costs $ in Millions 22% $3,819 $2 $10 $49 $116 $3,134 $388 $124 12% 71% 23% (
Slide 10: Solid Cash Generation Supports Strong Balance Sheet & Shareholder Returns
Solid Cash Generation Supports Strong Balance Sheet & Shareholder Returns Cash From Operations vs. Cash Returns to Comparable Cash Flow Shareholders Conversion* ($ in millions) ($ in millions) $7,891 $7,859 $7,070 $6,503 5% Reduction 95% $5,497 in Average Share Repurchases $5,846 Share Balance 80% D
Slide 11: 2022 Success Drivers
THIRD QUARTER 2022 Lance Fritz Chairman, President & CEO 21 2022 Success Drivers Enhance Safety Programs Advance Customer Experience Operational Excellence Expand Reach to Service New Markets and Industries Provide Value to All Win with Customers Stakeholders Industry Leading Cash ESG Leader Returns
Slide 12: Cautionary Information
Cautionary Information This presentation and related materials contain statements about the Company’s future that are not statements of historical fact, including specifically the statements regarding the Company’s expectations with respect to economic conditions and demand levels, its ability to im
Slide 13: Summary of Labor Accrual Adjustments
APPENDIX Summary of Labor Accrual Adjustments Summary of Labor Accrual Adjustments $114 Million Impact in Reported Third Quarter 2022 Results General Wage Annual Pre-tax $ in Millions Increase Bonus Total 2020 / 2021 Accrual $ 31 $ 61 $ 92 First Quarter 2022 Accrual 3 8 11 Second Quarter 2022 Accrua