Q4 wraps up impressive 2011 for Union Pacific
Want some numbers to back up the renewed interest in freight rail growth?
Look no further. Union Pacific Corporation, one of the world’s most prestigious freight rail companies, today reported 2011 fourth quarter net income of $964 million, or $1.99 per diluted share, compared to $775 million, or $1.56 per diluted share, in the fourth quarter 2010.
Union Pacific CEO Jim Young is rightfully pleased with his company’s progress in 2011.
“The dedicated efforts of our employees, combined with the strength of our diverse railroad franchise, drove record fourth quarter results,” Young said. “In 2011, we achieved best-ever marks in customer satisfaction and employee safety, invested a record $3.2 billion in capital, and generated record free cash flow of $1.9 billion. 2011 was the most profitable year in Union Pacific's history, allowing us to reward shareholders with increased financial returns.”
Fourth Quarter Summary
Fourth quarter business volumes, as measured by total revenue carloads, grew 3 percent versus 2010. Four of Union Pacific's six business groups - chemical, automotive, energy and industrial products - reported strong volume increases. In addition, quarterly operating revenue increased 16 percent in the fourth quarter 2011 to a record $5.1 billion versus $4.4 billion in the fourth quarter 2010.
Each of Union Pacific’s six business groups reported freight revenue growth in the fourth quarter driven by increased fuel cost recoveries and core pricing gains. Volume growth was also a contributing factor in four of the six business groups.
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Union Pacific’s operating ratio of 68.3 percent was a fourth quarter best, 1.9 points better than the previous fourth quarter record set in 2010. Pricing gains, volume growth and improved operating efficiency contributed to this record performance, more than offsetting the negative impact of higher diesel fuel prices compared to 2010.
Average quarterly diesel fuel prices increased 28 percent to $3.16 per gallon in the fourth quarter 2011 from $2.46 per gallon in the fourth quarter 2010.
In related news, the Customer Satisfaction Index of 92 tied a quarterly best and was two points better than the fourth quarter 2010.
Quarterly train speed, as reported to the Association of American Railroads, was 25.6 mph, decreasing 3 percent compared to the fourth quarter 2010.
More on Union Pacific
It was 150 years ago that Abraham Lincoln signed the Pacific Railway Act on July 1, 1862, creating the original Union Pacific. One of America's iconic companies, today, Union Pacific Railroad is the principal operating company of Union Pacific Corporation linking 23 states in the western two-thirds of the country by rail and providing freight solutions and logistics expertise to the global supply chain.
From 2000 through 2011, Union Pacific spent more than $31 billion on its network and operations, making needed investments in America's infrastructure and enhancing its ability to provide safe, reliable, fuel-efficient and environmentally responsible freight transportation.
Union Pacific's diversified business mix includes Agricultural Products, Automotive, Chemicals, Energy, Industrial Products and Intermodal. The railroad serves many of the fastest-growing U.S. population centers and emphasizes excellent customer service. Union Pacific operates competitive routes from all major West Coast and Gulf Coast ports to eastern gateways, connects with Canada's rail systems and is the only railroad serving all six major Mexico gateways.
DHL Claim Multi-Sector Collaboration Key to Fighting COVID
Since January, global logistics leader DHL has distributed more than 200 million doses of the COVID vaccine to 120+ countries around the globe. While the US and UK recently rolled out immunisation plans to most citizens, countries with less developed infrastructure still desperately need more doses. In the United Arab Emirates (UAE), which currently has one of the highest per-capita immunisation rates, the government set up storage facilities to cover domestic and international demand. But storage, as we’ve learned, is little help if you can’t transport the goods.
This is where logistics leaders such as DHL make their impact. The company built over 50 new partnerships, bilateral and multilateral, to collaborate with pharmaceutical and private sector firms. With more than 350 DHL centres pressed into service, the group operated 9,000+ flights to ship the vaccine where it needed to go.
With new pandemic knowledge, DHL just released its “Revisiting Pandemic Resilience” white paper, which examined the role of logistics and supply chain companies in handling COVID-19. As Thomas Ellman, Head of Clinical Trials Logistics at DHL, said: “The past one year has highlighted the importance of logistics and supply chain management to manage the pandemic, ensure business continuity and protect public health. It has also shown us that together we are stronger”.
Multisector partnerships, DHL said, enabled rapid, effective vaccine distribution. While international scientists developed a vaccine in record time—five times faster than any other vaccine in history—manufacturers ramped up production and logistics teams rolled out distribution three times faster than expected. When commercial routes faced backups, logistics operators worked with military officers to transport vaccines via helicopters and boats.
In the UAE, the public-private HOPE Consortium distributed billions of COVID-19 doses to its civilians as well as other countries in need by partnering with commercial organisations such as DHL. For the first time, apropo for an unprecedented pandemic, logistics companies made strong connections with public health and government.
“While the race against the virus continues, leveraging the power of such collaborations and data analytics will be key”, said Katja Busch, Chief Commercial Officer DHL and Head of DHL Customer Solutions & Innovation. “We need to remain prepared for high patient and vaccine volumes, maintain logistics infrastructure and capacity, while planning for seasonal fluctuations by providing a stable and well-equipped platform for the years to come”.
How Do We Sustain Immunisation?
By the end of 2021, experts estimate that we need approximately 10 billion doses of vaccines—many of which will be shipped to areas of the world, such as India, South Africa, and Brazil, that lack significant infrastructure. This is perhaps the greatest divide between countries that have rolled out successful immunisation programmes and those that have not. As Busch noted, “the UAE’s significant investments in creating robust air, sea, and land infrastructure facilitated logistics and vaccine distribution, helping us keep supply chains resilient”.
Neither is the novel coronavirus a one-time affair. If predictions hold, COVID will be similar to seasonal colds or the flu: here to stay. When fall comes around each year, governments will need to vaccinate the world as quickly as possible to ensure long-term immunisation against the virus. This time, logistics companies must be better prepared.
Yet global immunisation, year after year, is no small order. To keep reinfection rates low and slow the spread of COVID, governments will likely need 7-9 billion annual doses of the vaccine to meet that mark. And if DHL’s white paper is any judge of success, multi-sector supply chain partnerships will set the gold standard.