OMAHA, Neb. — Union Pacific Corp. announced that its Board of Directors voted today to increase the quarterly dividend on the company’s common shares by 22 percent to 33 cents per share. The increased dividend is payable July 1 to stockholders of record on May 28.
“Two weeks ago Union Pacific reported record first quarter earnings, evidence that we are emerging from the challenge of last year’s recession as a stronger, more profitable company,” said Jim Young, Union Pacific chairman and chief executive officer. “With business volumes continuing to grow, we feel very positive about the long-term fundamentals of our business as well as UP’s strategy to make the most of these opportunities. As a result, we are generating solid free cash flows and have confidence going forward that we are taking the right steps to capitalize on our growth opportunities and reward our shareholders.”
The Board also approved a $100 million increase in growth capital spending in 2010, bringing the full year 2010 investment to $2.6 billion, primarily to acquire additional intermodal equipment and support our intermodal strategy.
“UP’s domestic intermodal business grew 8 percent last year during one of the worst recessions in decades, as our record service performance attracted new business to our railroad,” Young said.
In addition, Union Pacific plans to resume share repurchases on an opportunistic basis under its existing program, which authorizes purchases of up to 32.6 million shares by March 31, 2011. Timing and volume of share repurchases will be at the discretion of management. Any share repurchase under this program may be made in the open market, or otherwise.
Union Pacific has paid dividends on its common stock for 111 consecutive years.