Union Pacific Reports Fourth Quarter and Full Year 2015 Results

Fourth Quarter Operating Ratio of 63.2 percent

FOR IMMEDIATE RELEASE

Fourth Quarter Results

· Diluted earnings per share of $1.31 declined 19 percent.

· Operating income totaled $1.9 billion, down 19 percent.

· Operating ratio of 63.2 percent, up 1.8 points.

Full Year 2015 Results

· Diluted earnings per share of $5.49 declined 5 percent.

· Operating income totaled $8.1 billion, down 8 percent.

· Operating ratio of 63.1 percent, improved 0.4 points.

Omaha, Neb., January 21, 2016 – Union Pacific Corporation (NYSE: UNP) today reported 2015 fourth quarter net income of $1.1 billion, or $1.31 per diluted share compared to $1.4 billion, or $1.61 per diluted share, in the fourth quarter 2014.

“Total volumes decreased 9 percent in the quarter, more than offsetting another quarter of solid core pricing gains,” said Lance Fritz, Union Pacific chairman, president and chief executive officer. “On the cost side, we continued to adjust resources throughout the quarter and also made solid progress with our productivity initiatives. As a result of these efforts, we achieved a quarterly operating ratio of 63.2 percent.” Fourth Quarter Summary

Operating revenue of $5.2 billion was down 15 percent in the fourth quarter 2015 compared to the fourth quarter 2014. Fourth quarter business volumes, as measured by total revenue carloads, declined 9 percent compared to 2014. Volumes declined in each of the Company’s business groups with the exception of automotive. In addition:

· Quarterly freight revenue decreased 16 percent compared to the fourth quarter 2014, as volume declines, lower fuel surcharge revenue, and negative business mix more than offset core pricing gains.

· Union Pacific’s 63.2 percent operating ratio was unfavorable by 1.8 points compared to the fourth quarter 2014.

· The $1.61 per gallon average quarterly diesel fuel price in the fourth quarter 2015 was 39 percent lower than the fourth quarter 2014.

· Quarterly train speed, as reported to the Association of American Railroads, was 27.0 mph, 13 percent faster than the fourth quarter 2014.

· The Company repurchased 6.6 million shares in the fourth quarter 2015 at an aggregate cost of $586 million.

Summary of Fourth Quarter Freight Revenues

· Automotive up 1 percent

· Chemicals down 7 percent

· Agricultural Products down 12 percent

· Intermodal down 14 percent

· Industrial Products down 23 percent

· Coal down 31 percent

2015 Full Year Summary

For the full year 2015, Union Pacific reported net income of $4.8 billion or $5.49 per diluted share versus $5.2 billion or $5.75 per diluted share in 2014, representing 8 and 5 percent decreases, respectively. Operating revenue totaled $21.8 billion as compared to $24.0 billion in 2014. Operating income totaled $8.1 billion, an 8 percent decrease compared to 2014. In addition:

· Freight revenue decreased to $20.4 billion, a 10 percent decrease when compared to 2014. Carloadings were down 6 percent versus 2014, with declines in each of the Company’s business groups with the exception of automotive.

· Average diesel fuel prices decreased 38 percent to $1.84 per gallon in 2015 from $2.97 per gallon in 2014.

· Union Pacific’s operating ratio of 63.1 percent was a full year record, improving 0.4 points from the previous record set in 2014.

· Train speed, as reported to the Association of American Railroads, was 25.4 mph, 6 percent faster compared to the full year 2014.

· Union Pacific’s reportable personal injury rate of 0.87 incidents per 200,000 employee-hours was a full year record, improving 11 percent compared to the full year 2014.

· Union Pacific’s capital program in 2015 totaled $4.3 billion, an increase of approximately $200 million compared to the full year 2014.

· The Company repurchased 35.3 million shares in 2015 at an aggregate cost of almost $3.5 billion.

2016 Outlook

“This past year was a difficult one in many respects, but our team did outstanding work in the face of dramatic declines in volumes, and shifts in our business mix,” Fritz said. “Overall economic conditions, uncertainty in the energy markets, commodity prices, and the strength of the U.S. dollar will continue to have a major impact on our business this year. However, we are well-positioned to efficiently serve customers in existing markets as they rebound. The strength and diversity of the Union Pacific franchise also will provide tremendous opportunities for new business development as both domestic and global markets evolve. When combined with our unrelenting focus on safety, productivity, and service, these opportunities will translate into an excellent experience for our customers and strong value for our shareholders in the years ahead.”

Fourth Quarter 2015 Earnings Conference Call

Union Pacific will host its fourth quarter 2015 earnings release presentation live over the Internet and via teleconference on Thursday, January 21, 2016 at 8:45 a.m. Eastern Time. The presentation will be webcast live over the internet on Union Pacific’s website at www.up.com/investor. Alternatively, the webcast can be accessed directly through the following link. Participants may join the conference call by dialing 877/407-8293 (or for international participants, 201/689-8349).

ABOUT UNION PACIFIC

Union Pacific Railroad is the principal operating company of Union Pacific Corporation (NYSE: UNP). One of America's most recognized companies, Union Pacific Railroad connects 23 states in the western two-thirds of the country by rail, providing a critical link in the global supply chain. From 2006-2015, Union Pacific invested approximately $33 billion in its network and operations to support America’s transportation infrastructure. The railroad’s diversified business mix includes Agricultural Products, Automotive, Chemicals, Coal, Industrial Products and Intermodal. Union Pacific serves many of the fastest-growing U.S. population centers, operates 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. Union Pacific provides value to its roughly 10,000 customers by delivering products in a safe, reliable, fuel-efficient and environmentally responsible manner.