Union Pacific Corporation · NYSE:UNP
Union Pacific — Q3 2020 Earnings Presentation
11 slides from Union Pacific's earnings presentation, Oct 22, 2020
Slide 1: Third Quarter 2020 Earnings Release
THIRD QUARTER 2020 EARNINGS RELEASE Lance Fritz – Chairman, President & CEO October 22, 2020 Third Quarter 2020 Results Earnings Per Share Operating Ratio $2.22 All-Time Quarterly $2.01 Record 59.5% 58.7% (9%) (0.8) pts 2019 2020 2019 2020 2
Slide 2: Operations Review: Key Performance Metrics 3Q 2020 vs. 3Q 2019
THIRD QUARTER 2020 OPERATIONS REVIEW Jim Vena Chief Operating Officer 3 Unified Plan 2020 Key Performance Metrics – 3Q 2020 vs. 3Q 2019 All-Time All-Time Quarterly Quarterly Record Record 220 22.8 25.3 138 998 77 72 FREIGHT CAR FREIGHT CAR TRAIN SPEED LOCOMOTIVE WORKFORCE INTERMODAL MANIFEST/AUTO VE
Slide 3: Unified Plan 2020 Update and Operating Outlook
Unified Plan 2020 Update Terminal Rationalization & Network Changes Train Length (Max on Route, in Feet) • Continued Focus on Increasing Train Length 9,000 • Completed Twenty-Eight 15,000 Foot ~1,950 ft Sidings 8,500 +28% • Network Changes 8,000 – Curtailed North Platte East Hump Yard 7,500 – Chicag
Slide 4: Marketing & Sales Review: Bulk
THIRD QUARTER 2020 MARKETING & SALES REVIEW Kenny Rocker Executive Vice President – Marketing & Sales 7 Bulk Revenue $1,478M (-12%) Volume 498K (-9%) ARC $2,964 (-3%) Coal & Grain & Fertilizer Food & Renewables Grain Products Refrigerated 271 213 181 187 (21%) 3% 48 50 48 48 4% Flat 2019 2020 2019 2
Slide 5: Industrial and Premium Results
Industrial Revenue $1,567M (-18%) Volume 480K (-16%) ARC $3,271 (-2%) Energy & Forest Products Industrial Metals & Specialized Chemicals & Minerals Plastics 200 157 158 156 144 125 (22%) (9%) (20%) 55 55 Flat 2019 2020 2019 2020 2019 2020 2019 2020 Quarterly Drivers Energy Market Challenges Pandemic
Slide 6: Fourth Quarter Volume & Outlook
Fourth Quarter Volume & Outlook Fourth Quarter Volume To Date* 7-Day Weekly Carloadings (000s) Premium 11% 180 2019 Bulk 3% 160 140 2020 Industrial (9%) 120 TOTAL 4% 100 1Q 2Q 3Q 4Q 11 * Volume through October 14 THIRD QUARTER 2020 FINANCIAL REVIEW Jennifer Hamann Executive Vice President & Chief Fi
Slide 7: Third Quarter Income Statement and Freight Revenue
Third Quarter Income Statement $ in Millions (except EPS) 2020 2019 Variance Operating Revenues $4,919- $5,516- (11)--- % Operating Expenses 2,888- 3,282- (12)--- Operating Income 2,031- 2,234- (9)--- Other Income 37- 534 (30)--- Interest Expense (295) (266) 11---- Income Taxes (410) (466) (12)--- N
Slide 8: Third Quarter Operating Expenses and Productivity Results
Third Quarter Operating Expenses $ in Millions (12%) $3,282 $126 $2,888 $203 $66 $22 $19 $2 (11%) (40%) (11%) (8%) Flat 8% Compensation Fuel Purchased Equipment Depreciation Other & Benefits Services & & Other Materials Rents 2019 2020 15 Volume Variability Productivity Results 3Q 2020 vs. 3Q 2019 (
Slide 9: Cash Generation & Liquidity; Updated 2020 Guidance
Cash From Ops vs. Cash Conversion Cash Generation & Liquidity ($ in millions) $6,264 93% Year-to-Date Results $5,993 83% • Cash from Operations Down 4% as Net Income Down 12% • Cash Flow Conversion Rate Equal to 93% of Net Income* YTD 2019 YTD 2020 • Maintained Industry Leading Dividend Payout & Res
Slide 10: Looking Ahead
THIRD QUARTER 2020 Lance Fritz Chairman, President & CEO 19 Looking Ahead • Committed to Employee Safety & Health • Continue Implementation of Unified Plan 2020 • Deliver a Highly Consistent and Reliable Service Product • Win with Customers 20
Slide 11: Question & Answer Session; 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