Union Pacific profit rises 19 percent, beats views

The nation's largest freight railroad operator also issued a third-quarter earnings prediction above analysts' current views, expecting strong pricing to counter volumes dragged lower by a softening U.S. economy. The Omaha, Neb.-based company also issued a full-year earnings prediction within a range of what Wall Street expected.

The company earned $531 million, or $1.02 per share in the second-quarter, compared with $446 million, or 82 cents per share, a year earlier.

Revenue rose 13 percent to $4.57 billion, from $4.05 billion in the 2007 second quarter.

The results soared past Wall Street's expectations. Analysts polled by Thomson Financial forecast profit of 92 cents per share on revenue of $4.51 billion.

Carloads of agricultural products such as grain rose 11 percent in the quarter. Shipments of energy related products, which include everything from coal to wind turbines, rose 2 percent. Chemical carloads rose 1 percent.

Shipments of industrial products fell 1 percent, reflecting the softening U.S. economy. Intermodal volumes, which involve freight transferred between truck and train, fell 6 percent. But automotive shipments declined by the biggest margin--about 20 percent--because of the struggling U.S. vehicle market.

Total volumes in the quarter dropped by 3 percent.

But the railroad was still able to post higher revenue in five out of six business segments as rates remained strong.

Revenue from shipments of agricultural products jumped 29 percent, and carload revenue for energy related products jumped 21 percent. Chemical revenue rose 14 percent, while industrial product revenue increased 9 percent. Revenue from intermodal shipments rose 7 percent.