* First-quarter rev $5.64 bln vs est $5.70 bln
* Earnings $2.38/share vs est $2.37
* Revenue in agricultural products business up 16 pct
(Adds executive comment, details; updates shares)
By Sagarika Jaisinghani
April 17 Union Pacific Corp, the largest
publicly traded U.S. railroad, reported a 14 percent jump in
profit as coal shipments, its largest cargo, picked up and the
company hauled more grains meant for export to Mexico and China.
Demand for thermal coal is expected to recover in the United
States after two years of decline as power producers switch back
to coal due to a recent run-up in natural gas prices.
U.S. coal miners Alpha Natural Resources and Arch
Coal Inc said earlier this year that they expected
demand for thermal coal to pick up due to severe winter weather,
coupled with a fall in inventory levels at utilities.
"Lower inventories will continue to be a driver for our coal
business in the second quarter," Eric Butler, executive vice
president of Union Pacific's marketing and sales, said on a call
Rival Kansas City Southern said on Wednesday coal
shipments were better than expected in the first quarter and
that it expects that strength to continue in the current
U.S. railroads are key indicators of the health of an
economy because of the variety of goods they transport. Union
Pacific connects 23 states in the western two-thirds of the
The pick-up in shipments comes on the back of a severe U.S.
winter that hit rail traffic and caused delays up to 48 hours.
Union Pacific's coal shipments rose 7 percent in the first
quarter ended March 31. Shipments had dropped 9 percent and 14
percent in the past two years.
Revenue in the company's agricultural business, which ships
a range of products such as frozen food, beer, oils and whole
grains, rose 16 percent. Total revenue rose 6.6 percent to $5.64
Net income rose to $1.09 billion, or $2.38 per share, from
$957 million, or $2.03 per share, a year earlier.
Analysts on average expected earnings of $2.37 per share on
revenue of $5.70 billion, according to Thomson Reuters I/B/E/S.
The Omaha, Nebraska-based company's shares were down 0.2
percent at $187.4 on the New York Stock Exchange on Thursday.
The stock has gained more than a third in the past 12 months
to Wednesday close, beating a 29 percent rise in the S&P
(Reporting by Sagarika Jaisinghani in Bangalore; Editing by
Joyjeet Das and Don Sebastian)