UNP - Union Pacific Corporation (UNP) Q1 2024 Earnings Call Transcript
2024-04-25 13:07:10 ET
Union Pacific Corporation (UNP)
Q1 2024 Results Conference Call
April 25, 2024 08:45 AM ET
Company Participants
Jim Vena - Chief Executive Officer
Jennifer Hamann - Chief Financial Officer
Kenny Rocker - Executive Vice President of Marketing and Sales
Eric Gehringer - Executive Vice President of Operations
Conference Call Participants
David Vernon - Bernstein
Justin Long - Stephens
Amit Mehrotra - Deutsche Bank
Jon Chappell - Evercore ISI
Ken Hoexter - Bank of America
Ravi Shanker - Morgan Stanley
Brian Ossenbeck - JPMorgan
Jordan Alliger - Goldman Sachs
Eric Morgan - Barclays
Jeff Kauffman - Vertical Research Partners
Tom Wadewitz - UBS
Bascome Majors - Susquehanna
Scott Group - Wolfe Research
Stephanie Moore - Jefferies
Elliot Alper - TD Cowen
Walter Spracklin - RBC Capital Markets
Ben Nolan - Stifel
Presentation
Operator
Greetings, and welcome to the Union Pacific First Quarter 2024 Conference Call. At this time, all participants are in listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded, and the slides for today's presentation are available on Union Pacific's website.
It is now my pleasure to introduce your host, Mr. Jim Vena, Chief Executive Officer for Union Pacific. Thank you, Mr. Vena. You may now begin.
Jim Vena
Thanks, Rob, and good morning to everyone. Beautiful day in Omaha, 6 degrees, a little bit of rain. It is absolutely perfect for railroading. So why don't we get started? And thank you for joining us today to discuss Union Pacific's first quarter results.
I'm joined in Omaha by our Chief Financial Officer, Jennifer Haymann; our Executive Vice President of Marketing and Sales, Kenny Rocker; and our Executive Vice President of Operations, Eric Gehringer.
As you'll hear from the team, we continue to execute our multiyear strategy to establish Union Pacific as the industry leader in safety service and operational excellence. We, again, took positive steps towards that goal in the first quarter. While challenges outside our control persists, we are establishing a foundation for long-term success.
Now let's discuss first quarter results starting on Slide 3. This morning, Union Pacific reported 2024 first quarter net income of $1.6 billion or $2.69 per share. This compares to 2023 first quarter net income of $1.6 billion or $2.67 per share. We're pleased to be able to report earnings growth in a tough environment, especially since last year's results included a $0.14 per share real estate gain.
First quarter operating revenue was flat as solid core pricing gains and a positive business mix were offset by lower fuel surcharge revenue and reduced volumes. Normalizing for the impact from fuel surcharge, freight revenue was up 4% versus last year. Expenses year-over-year were down 3%, driven by lower fuel prices and productivity gains. This was partially offset by inflation, increased transportation workforce levels to compensate for new labor agreements and higher depreciation.
Our first quarter operating ratio of 60.7% improved 140 basis points versus last year. This also represents a 20 basis point improvement sequentially from the fourth quarter, which further demonstrates the strong work by the team. Look, it's a great start to the year. I'm pleased with how the Union Pacific team is coming together on lots possible for our company. But there's a lot of work to do.
I'll let the team walk you through the quarter in more detail, and I'll come back and wrap it up before we go to question and answer....
Union Pacific Corporation (UNP) Q1 2024 Earnings Call Transcript