US-based Union Pacific has posted a slight growth in profit in the second quarter of this year, despite high fuel prices and increased expenses.
The railroad reported a net income of $1.84bn, or $2.93 per diluted share, in the three-month-period ending 30 June 2022 versus $1.8bn or $2.72 a diluted share in the same period last year.
Operating income increased 1% to $2.5bn from $2.47bn.
Benefitting from higher fuel surcharge revenue and core pricing gains, the company’s operating revenues grew 14% year-on-year to $6.27bn.
However, Union Pacific reported a 25% increase in operating expenses to $3.7bn from $3.03bn.
Its business volumes dipped 1%, as measured by total revenue carloads.
The company posted a 12% fall in quarterly freight car velocity with 187 daily miles per car, as well as a 12% drop in quarterly locomotive productivity with 123 gross tonne-miles (GTMs) per horsepower day.
Furthermore, quarterly workforce productivity decreased 2% to 1,034 car miles per employee.
Union Pacific chairman, president and CEO Lance Fritz said: “As anticipated, the Second Quarter was a tough one as we limited carloadings and increased expenses to recover network fluidity.
“We also experienced record high fuel prices and increasing inflation, adding pressure to our total costs. Offsetting the cost pressures were higher fuel surcharge revenue, solid core pricing, a positive mix, and continued train size initiatives.”