OMAHA — Union Pacific reported stronger financial results for the first quarter of the year, posting a 5 percent increase in earnings as the company continues efforts to secure approval for its proposed 85-billion-dollar acquisition of Norfolk Southern.
The Omaha-based railroad announced it earned 1-point-7 billion dollars, or 2 dollars and 87 cents per share, during the quarter. That figure is up from 1-point-63 billion dollars, or 2 dollars and 70 cents per share, during the same period last year. Company officials noted that costs related to the proposed merger slightly reduced earnings, but overall results still came in higher than analysts had expected.
Union Pacific leaders say the company improved efficiency and benefited from higher shipping rates, even though the number of shipments moved during the quarter declined slightly. Total revenue increased about 3 percent to 6-point-22 billion dollars, while operating expenses also rose by roughly the same percentage.
Chief Executive Officer Jim Vena said the company remains confident that combining Union Pacific with Norfolk Southern would create the nation’s first truly coast-to-coast freight railroad, allowing goods to move faster and more efficiently across the country. He added that the merger could reduce highway traffic by shifting more freight to rail and provide long-term job stability for employees.
Union Pacific plans to resubmit its merger application to federal regulators in the coming days. The U.S. Surface Transportation Board previously declined to approve the proposal, requesting additional information before making a final decision.
The proposed merger has drawn mixed reactions. Some labor unions and businesses support the deal, saying it could improve service and strengthen the nation’s supply chain. Others, including certain rail worker groups and industry organizations, have raised concerns about competition and long-term impacts on the rail system.
Looking ahead, Union Pacific reaffirmed its expectation for steady growth this year and announced plans to invest about 3-point-3 billion dollars into operations and infrastructure improvements.
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