Joint The Pacific (UNP.US) Q4 profit exceeds expectations, operating efficiency improves.

United The Pacific (UNP.US) announced its financial performance for the fourth quarter and full year of 2024. In the fourth quarter, the company's revenue was $6.1 billion, a 1% decrease compared to the same period last year, mainly due to a decrease in fuel surcharge revenue, unfavorable business mix, and other income reductions. However, sales volume growth partially offset this impact. Additionally, net profit for the fourth quarter was $1.8 billion, equivalent to diluted earnings per share of $2.91, exceeding the expected value of $2.79. This performance includes $40 million in labor costs incurred due to the approval of crew staffing agreements. In comparison, net profit for the fourth quarter of 2023 was $1.7 billion, with diluted earnings per share of $2.71. Looking at the full year, United The Pacific reported a net profit of $6.7 billion for 2024, with earnings per share of $11.09, a decrease from the full year net profit of $6.4 billion and earnings per share of $10.45 in 2023. Specifically, the company's revenue in the fourth quarter was $6.1 billion, a decrease of $50 million compared to the same period last year, a 1.0% decrease year-on-year. Operating truck loadings increased by 5%, and operating ratio improved by 220 basis points to 58.7%, including a 70 basis point adverse impact from crew staffing agreements. Furthermore, the company made significant progress in operating efficiency: operating income reached $2.5 billion, a 5% increase year-on-year; truck speeds increased by 1% to 219 miles per vehicle per day; labor productivity improved by 6% to 1,118 miles per employee; fuel consumption rate increased by 1% to 1.078 (measured in gallons per thousand total ton-miles of fuel). However, quarterly locomotive productivity decreased by 3% to 136 total ton-miles per horsepower per day. Looking ahead to 2025, United The Pacific plans to align with investor day targets. Despite the potential impact of complex economic environments, coal demand, and international intermodal challenges on freight volume, the company plans to improve operating ratio through pricing strategies and achieve a high single to low double-digit compound annual earnings per share growth target over the next three years. The company will continue to maintain industry-leading operating ratio and return on investment capital, while keeping its long-term capital allocation strategy unchanged. In 2025, the company plans to invest $3.4 billion in capital expenditures and plans to repurchase $4 to $4.5 billion worth of stock.