Union Pacific railroad's 4Q profit rises 7 percent

(AP) Union Pacific's fourth-quarter profit chugged ahead 7 percent because the railroad raised shipping rates and collected more fuel surcharges.

The nation's largest railroad said Thursday it earned $1.04 billion, or $2.19 per share, during the quarter. Revenue grew 3 percent to $5.25 billion.

The earnings exceeded Wall Street estimates but revenue fell short of expectations. Analysts surveyed by FactSet expected UP to earn $2.15 per share on revenue of $5.30 billion.

In premarket trading, the company's stock price fell 1 percent, or $1.33, to $134.02 a share.

Union Pacific's results offer insight into the nation's economic health because of the variety of cars, crops, chemicals and containers of imported goods it carries. It has more than 32,400 miles of track in 23 states in the West, Midwest and Gulf coast.

The company's shipping volume fell 2 percent in the quarter. Declines in coal and agricultural shipments couldn't be overcome in other areas of the railroad's business, despite significant increases in chemical and automotive shipments.

Our diverse portfolio of business, solid core pricing gains, and efficient network operations drove these results despite significantly weaker coal and grain markets, UP CEO Jack Koraleski said.

Coal demand has been weak in the past year because of relatively cheap natural gas prices and last year's mild winter. In the fourth quarter, Union Pacific hauled 17 percent less coal than the year before.

Agricultural shipments were hurt by a drought and the temporary shutdown of some ethanol plants.

Most of the challenges the Omaha, Neb.-based company faced last year will continue in 2013, Koraleski said.

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Online:

Union Pacific Corp.: www.up.com