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Union Pacific 4Q Earnings Up 64 Percent
In the arena of profits, Fort Worth, Texas-based Burlington Northern was the leader last year with $1.89 billion to Union Pacific's $1.61 billion.
Regardless of which railroad is bigger, both Union Pacific and Burlington Northern reported strong performances this week.
  A Union Pacific engine sits in a railway yard Oct. 27, 2005, in a Salt Lake City file photo. Union Pacific Corp., the nation's largest railroad operator, on Thursday said fourth-quarter profit rose 63 percent, due mostly to more efficient operations and higher revenue from shipments of agricultural and energy-related commodities. (AP Photo/Douglas C. Pizac, File) (Douglas C. Pizac - AP) Partnership
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• Union Pacific's earnings of $1.78 per share in the fourth quarter surpassed the expectations of analysts polled by Thomson Financial, which had forecast a profit of $1.57 per share.
Union Pacific officials said greater efficiencies and strong demand for the coal and agricultural products it ships helped boost profits. It posted improved revenue in five of its six business groups, led by 20 percent increases from shipping agricultural and energy-related commodities. Revenue from industrial products fell slightly.
The company also said its operating ratio, or the ratio of operating expenses to revenue and a key measure of efficiency for railroads, improved to 79.6 percent from 85.3 percent in 2005. Railroads typically target an operating ratio of 80 percent.
Burlington Northern reported Tuesday that earnings rose 21 percent in the fourth quarter.
Union Pacific officials predict revenue growth in 2007 of 6 percent to 7 percent and growth in earnings per share of 10 percent to 15 percent.
On Tuesday, Burlington Northern officials forecast a 7 percent to 8 percent rise in freight revenue in 2007 and earnings per share percentage growth in the low teens.
Union Pacific's shares lost 47 cents to close Thursday at $96.49, while Burlington Northern's shares lost $1.01 to close at $78.28. Both stocks trade on the New York Stock Exchange.
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On the Net:
Union Pacific Corp.: http:/
Burlington Northern Santa Fe Corp.: http:/
