Union Pacific Raises Dividend by 15%; Sees 2014 Capital Spending of $3.9 Billion

   By Tess Stynes 
 

Union Pacific Corp. (UNP) said its board approved a 15% increase in the railroad company's quarterly dividend as well as a 2014 capital spending budget of roughly $3.9 billion.

The quarterly dividend will rise to 91 cents a share, an increase of 12 cents a share.

The company said the 2014 capital spending plan represents an increase of about $300 million over 2013 levels and includes increased spending for rail anticrash technology, known as Positive Train Control, or PTC.

Capital spending for Positive Train Control is expected to increase 7.1% to $450 million. The anticrash technology is designed to automatically stop a train even before it runs a red signal or gets into other dangerous situations.

"This dividend increase demonstrates our confidence in Union Pacific's continued ability to generate growing cash returns on our diverse franchise opportunities," said Chief Financial Officer Rob Knight.

"The increased capital spending plan for 2014 also highlights our expectation of future volume growth across a wide range of markets in 2014 and beyond," he added.

Union Pacific last month reported that its fourth-quarter earnings rose 13% on improved shipments and pricing gains, despite a continued slump in coal volume.

Write to Tess Stynes at [e-mail]

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