Union Pacific Earnings Call Nuggets: Coal Volumes and Contract Losses
Thomas Wadewitz – JPMorgan: Let’s see, I’m going to surprise you here with a question on coal, I guess, Eric, sure you’ll get a lot on that but, anyways, can you give us some thoughts around what might drive upside or downside to your view on coal volumes. I think you are saying coal volumes are probably full year down a little bit. What would be the scenario, maybe your gas price levels, natural gas price level it would drive some upside and also in terms of risk to the downside how are you thinking about the impact of the Edison Mission bankruptcy and whether you are factoring in lower volumes there and for your comments on coal?
Eric L. Butler – EVP, Marketing and Sales: As you say there are lot of uncertainty in terms of the coal outlook and environment certainly on the down side regulatory environmental changes in Washington could have continued negative impact on the coal business and the coal market share. Certainly the natural gas, the price of natural gas can also have impacts on the downside and the upside right now we are expecting natural gas prices to remain in the $3.54 range for the year. But you know on the upside as natural gas prices go up that will drive more business to coal. If you look at the coal market share, full year market share for 2012 we are not expecting substantially higher coal market share vis-a-vis natural gas for 2013 maybe a point or two higher but basically flat in terms of overall market share.
But there will be upside and downside to that. In terms of the announced bankruptcies that are out there, we are working closely with our customers to work with them as they are working through those difficult times we also are doing what we need to do to ensure that we are preparing our corporate interest as we are going through the process. As you know the way the bankruptcies where customers have the right to look at contracts and we are working with them as they are going through that process and we’ll continue to work with them.
Robert M. Knight, Jr. – EVP and CFO: If I could just add couple of more points to Eric’s thoughts on drivers of coal. Remember we said in October at a conference it was about 10 million ton contract for us, so that’s factored obviously in 2013. And the other variable I’d remind everyone that can impact our coal volumes up or down is weather, and that’s always the case. The biggest driver is will we have a deep cold winter season and more importantly how early and how long and how deep will the summer season be and that can always influence our volume.