Union Pacific Reports Second Quarter 2023 Results

Rhea-AI Summary

Union Pacific Corporation (NYSE: UNP) reported a 5% decrease in operating revenue, with a net income of $1.6 billion, or $2.57 per diluted share for the second quarter of 2023. The company's financial results were impacted by softening consumer markets, inflation, and increased workforce levels. Despite this, the reportable derailment rate improved by 9%. Operating performance saw improvements in service performance, with a larger crew base. The company's outlook for 2023 is pressured by challenging demand and cost environment, with consumer-related volumes expected to drive full-year volume expectations below Industrial Production. The company also announced leadership and board updates, including the appointment of a new CEO, president, chairman, and two new independent directors.

Positive

• Improved service performance and a larger crew base contributed to better quarterly freight car velocity and locomotive productivity. The reportable derailment rate improved by 9%, indicating a positive trend in safety measures.

Negative

• Operating revenue was down 5%, with a 12% decline in operating income. The company's outlook for 2023 indicates challenges in demand and cost environment, with consumer-related volumes expected to drive full-year volume expectations below Industrial Production.

• Earnings per diluted share of $2.57
• Operating revenue down 5%
• Reportable derailment rate improved 9%

OMAHA, Neb., July 26, 2023 /PRNewswire/ -- Union Pacific Corporation (NYSE: UNP) today reported 2023 second quarter net income of $1.6 billion, or $2.57 per diluted share. These results include the previously disclosed $67 million labor expense and $73 million income tax benefit. This compares to 2022 second quarter net income of $1.8 billion, or $2.93 per diluted share.

"The results this quarter were impacted by softening consumer markets, inflation, a one-time labor expense, and increased workforce levels," said Lance Fritz, Union Pacific chairman, president, and chief executive officer. "The entire team remains focused on maintaining a solid service product while taking steps to recapture lost productivity and lay a strong foundation for sustainable future success. We took actions throughout the second quarter to drive greater network fluidity and provide our customers with better service. We finished the quarter with resource levels more aligned with demand, as we stored excess locomotives, improved recrew rates, and reduced borrowed-out employees."

Financial Results: Core Pricing Gains Offset by Reduced Fuel Surcharge Revenue, Lower Volumes, and an Unfavorable Business Mix
Second Quarter 2023 Compared to Second Quarter 2022

• Operating revenue of $6 billion was down 5% driven by reduced fuel surcharge revenue, lower volumes, and an unfavorable business mix, partially offset by core pricing gains.
• Business volumes, as measured by total revenue carloads, were down 2%.
• Operating ratio was 63.0%, up 280 basis points. This includes an unfavorable 110 basis point impact from a one-time labor agreement payment and a 200 basis point benefit from falling fuel prices.
• Operating income of $2.2 billion declined 12%.
• The company repurchased 600,000 shares in second quarter 2023 at an aggregate cost of $120 million.

Operating Performance: Improved Service Performance Supported by Larger Crew Base
Second Quarter 2023 Compared to Second Quarter 2022

• Quarterly freight car velocity was 202 daily miles per car, an 8% improvement.
• Quarterly locomotive productivity was 126 gross ton-miles (GTMs) per horsepower day, a 2% improvement.
• Average maximum train length was 9,316 feet, a 1% decline.
• Quarterly workforce productivity decreased 5% to 983 car miles per employee.
• Fuel consumption rate of 1.086, measured in gallons of fuel per thousand GTMs, deteriorated 1%.
• Union Pacific's first half reportable derailment rate improved 9% to 2.45 per million train miles compared to 2.68 for 2022.

2023 Outlook Pressured by Challenging Demand and Cost Environment

• Consumer-related volumes likely drive full year volume expectations below Industrial Production (Current forecast: +0.1%)
• Pricing dollars in excess of inflation dollars
• Forecasting $50 to $70 million in labor expense from new agreements in second half of 2023
• 2023 Capital Allocation:
• Capital plan of $3.6 billion
• Maintain dividend of $1.30/quarter
• No further 2023 share repurchases planned

Leadership and Board Updates

In separate press releases issued today, the Company appointed Jim Vena as chief executive officer, named Beth Whited as president, elected Mike McCarthy as chairman and appointed two new independent directors, Doyle Simons, and John Wiehoff, to the Board.

Second Quarter 2023 Earnings Conference Call

Union Pacific will webcast its second quarter 2023 earnings release presentation live at www.up.com/investor and via teleconference on Wednesday, July 26, 2023, at 8:45 a.m. Eastern Time. Participants may join the conference call by dialing 877-407-8293 (or for international participants, 201-689-8349).

ABOUT UNION PACIFIC

Union Pacific (NYSE: UNP) delivers the goods families and businesses use every day with safe, reliable, and efficient service. Operating in 23 western states, the company connects its customers and communities to the global economy. Trains are the most environmentally responsible way to move freight, helping Union Pacific protect future generations. More information about Union Pacific is available at www.up.com.

Supplemental financial information is attached.

This news release and related materials contain statements about the Company's future that are not statements of historical fact, including specifically the statements regarding the potential impacts of public health crises, including pandemics, epidemics and the outbreak of other contagious diseases, such as the coronavirus and its variant strains (COVID); the Russia-Ukraine conflict and its impact on our business operations, financial results, liquidity, and financial position, and on the world economy (including customers, employees, and supply chains), including as a result of fluctuations in volume and carloadings; expectations as to general macroeconomic conditions, including slowdowns and recessions, domestically or internationally, and future volatility in interest rates and fuel prices; closing of customer manufacturing, distribution, or production facilities; expectations as to operational or service improvements; expectations as to hiring challenges; availability of employees; expectations regarding the effectiveness of steps taken or to be taken to improve operations, service, infrastructure improvements, and transportation plan modifications; expectations as to cost savings, revenue growth, and earnings; the time by which goals, targets, or objectives will be achieved; projections, predictions, expectations, estimates, or forecasts as to business, financial, and operational results, future economic performance, and planned capital investments ; proposed new products and services; estimates of costs relating to environmental remediation and restoration; estimates and expectations regarding tax matters; expectations that claims, litigation, environmental costs, commitments, contingent liabilities, labor negotiations or agreements, cyberattacks or other matters. These statements are, or will be, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements also generally include, without limitation, information, or statements regarding: projections, predictions, expectations, estimates, or forecasts as to the Company's and its subsidiaries' business, financial, and operational results, and future economic performance; and management's beliefs, expectations, goals, and objectives and other similar expressions concerning matters that are not historical facts.

 Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times that, or by which, such performance or results will be achieved. Forward-looking information, including expectations regarding operational and financial improvements and the Company's future performance or results are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statement. Important factors, including risk factors, could affect the Company's and its subsidiaries' future results and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements. Information regarding risk factors and other cautionary information are available in the Company's Annual Report on Form 10-K for 2022, which was filed with the SEC on February 10, 2023. The Company updates information regarding risk factors if circumstances require such updates in its periodic reports on Form 10-Q and its subsequent Annual Reports on Form 10-K (or such other reports that may be filed with the SEC).

Forward-looking statements speak only as of, and are based only upon information available on, the date the statements were made. The Company assumes no obligation to update forward-looking information to reflect actual results, changes in assumptions, or changes in other factors affecting forward-looking information. If the Company does update one or more forward-looking statements, no inference should be drawn that the Company will make additional updates with respect thereto or with respect to other forward-looking statements. References to the Company's website are provided for convenience and, therefore, information on or available through the website is not, and should not be deemed to be, incorporated by reference herein.

 

UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES Condensed Consolidated Statements of Income (unaudited)
Millions, Except Per Share Amounts and		2nd Quarter												Year-to-Date
Percentages, For the Periods Ended June 30,		2023				2022						%		2023				2022						%
Operating Revenues
Freight revenues		$	5,569			$	5,842				(5)	%		$	11,225			$	11,282				(1)	%
Other revenues			394				427				(8)				794				847				(6)
Total operating revenues			5,963				6,269				(5)				12,019				12,129				(1)
Operating Expenses
Compensation and benefits			1,269				1,092				16				2,448				2,193				12
Fuel			664				940				(29)				1,430				1,654				(14)
Purchased services and materials			650				622				5				1,303				1,183				10
Depreciation			577				559				3				1,149				1,114				3
Equipment and other rents			248				230				8				483				445				9
Other			351				331				6				708				668				6
Total operating expenses			3,759				3,774				-				7,521				7,257				4
Operating Income			2,204				2,495				(12)				4,498				4,872				(8)
Other income, net			93				163				(43)				277				210				32
Interest expense			(339)				(316)				7				(675)				(623)				8
Income before income taxes			1,958				2,342				(16)				4,100				4,459				(8)
Income tax expense			(389)				(507)				(23)				(901)				(994)				(9)
Net Income		$	1,569			$	1,835				(14)	%		$	3,199			$	3,465				(8)	%
Share and Per Share
Earnings per share - basic		$	2.58			$	2.93				(12)	%		$	5.25			$	5.51				(5)	%
Earnings per share - diluted		$	2.57			$	2.93				(12)			$	5.24			$	5.50				(5)
Weighted average number of shares - basic			608.7				625.6				(3)				609.6				628.9				(3)
Weighted average number of shares - diluted			609.5				626.8				(3)				610.5				630.2				(3)
Dividends declared per share		$	1.30			$	1.30				-			$	2.60			$	2.48				5
Operating Ratio			63.0	%			60.2	%			2.8	pts			62.6	%			59.8	%			2.8	pts
Effective Tax Rate			19.9	%			21.6	%			(1.7)	pts			22.0	%			22.3	%			(0.3)	pts

 

UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES Freight Revenues Statistics (unaudited)
		2nd Quarter												Year-to-Date
For the Periods Ended June 30,		2023				2022				%				2023				2022				%
Freight Revenues (Millions)
Grain & grain products		$	890			$	867				3	%		$	1,833			$	1,744				5	%
Fertilizer			183				183				-				369				363				2
Food & refrigerated			255				271				(6)				518				538				(4)
Coal & renewables			429				492				(13)				934				1,000				(7)
Bulk			1,757				1,813				(3)				3,654				3,645				-
Industrial chemicals & plastics			545				557				(2)				1,081				1,077				-
Metals & minerals			562				562				-				1,098				1,047				5
Forest products			347				386				(10)				679				750				(9)
Energy & specialized markets			632				586				8				1,245				1,138				9
Industrial			2,086				2,091				-				4,103				4,012				2
Automotive			625				561				11				1,212				1,062				14
Intermodal			1,101				1,377				(20)				2,256				2,563				(12)
Premium			1,726				1,938				(11)				3,468				3,625				(4)
Total		$	5,569			$	5,842				(5)	%		$	11,225				11,282				(1)	%
Revenue Carloads (Thousands)
Grain & grain products			197				195				1	%			399				400				-	%
Fertilizer			48				53				(9)				93				98				(5)
Food & refrigerated			44				48				(8)				88				95				(7)
Coal & renewables			203				202				-				419				427				(2)
Bulk			492				498				(1)				999				1,020				(2)
Industrial chemicals & plastics			164				161				2				321				321				-
Metals & minerals			210				205				2				398				387				3
Forest products			55				63				(13)				107				127				(16)
Energy & specialized markets			144				141				2				283				272				4
Industrial			573				570				1				1,109				1,107				-
Automotive			213				192				11				413				382				8
Intermodal [a]			749				805				(7)				1,483				1,562				(5)
Premium			962				997				(4)				1,896				1,944				(2)
Total			2,027				2,065				(2)	%			4,004				4,071				(2)	%
Average Revenue per Car
Grain & grain products		$	4,527			$	4,451				2	%		$	4,598			$	4,357				6	%
Fertilizer			3,830				3,437				11				3,978				3,701				7
Food & refrigerated			5,740				5,770				(1)				5,851				5,703				3
Coal & renewables			2,107				2,426				(13)				2,228				2,340				(5)
Bulk			3,568				3,642				(2)				3,657				3,574				2
Industrial chemicals & plastics			3,336				3,455				(3)				3,368				3,351				1
Metals & minerals			2,677				2,755				(3)				2,760				2,710				2
Forest products			6,337				6,128				3				6,360				5,898				8
Energy & specialized markets			4,388				4,161				5				4,398				4,189				5
Industrial			3,646				3,674				(1)				3,701				3,626				2
Automotive			2,928				2,919				-				2,935				2,780				6
Intermodal [a]			1,471				1,711				(14)				1,521				1,641				(7)
Premium			1,794				1,943				(8)				1,829				1,864				(2)
Average		$	2,748			$	2,830				(3)	%		$	2,804			$	2,771				1	%

[a]	For intermodal shipments each container or trailer equals one carload.

 

UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES Condensed Consolidated Statements of Financial Position (unaudited)
	Jun. 30,			Dec. 31,
Millions, Except Percentages		2023				2022
Assets
Cash and cash equivalents		$	830			$	973
Short-term investments			-				46
Other current assets			2,922				2,933
Investments			2,524				2,375
Properties, net			56,641				56,038
Operating lease assets			1,651				1,672
Other assets			1,465				1,412
Total assets		$	66,033			$	65,449
Liabilities and Common Shareholders' Equity
Debt due within one year		$	1,745			$	1,678
Other current liabilities			3,504				3,842
Debt due after one year			31,557				31,648
Operating lease liabilities			1,217				1,300
Deferred income taxes			13,069				13,033
Other long-term liabilities			1,747				1,785
Total liabilities			52,839				53,286
Total common shareholders' equity			13,194				12,163
Total liabilities and common shareholders' equity		$	66,033			$	65,449

 

UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES Condensed Consolidated Statements of Cash Flows (unaudited)
	Year-to-Date
Millions, for the Periods Ended June 30,	2023			2022
Operating Activities
Net income	$	3,199		$	3,465
Depreciation		1,149			1,114
Deferred income taxes		36			93
Other - net		(526)			(505)
Cash provided by operating activities		3,858			4,167
Investing Activities
Capital investments*		(1,607)			(1,645)
Other - net		(67)			105
Cash used in investing activities		(1,674)			(1,540)
Financing Activities
Debt repaid		(1,664)			(1,664)
Debt issued		1,599			4,090
Dividends paid		(1,588)			(1,556)
Share repurchase programs		(705)			(3,473)
Net issued/(paid) of commercial paper		19			(151)
Other - net		11			(42)
Cash used in financing activities		(2,328)			(2,796)
Net change in cash, cash equivalents, and restricted cash		(144)			(169)
Cash, cash equivalents, and restricted cash at beginning of year		987			983
Cash, cash equivalents, and restricted cash at end of period	$	843		$	814
Free Cash Flow**
Cash provided by operating activities	$	3,858		$	4,167
Cash used in investing activities		(1,674)			(1,540)
Dividends paid		(1,588)			(1,556)
Free cash flow	$	596		$	1,071

*	Capital investments include locomotive and freight car early lease buyouts of $14 million in 2023 and $46 million in 2022.
**	Free cash flow is a non-GAAP measure; however, we believe this measure is important to management and investors in evaluating our financial performance and measures our ability to generate cash without additional external financing.

 

UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES Operating and Performance Statistics (unaudited)
		2nd Quarter												Year-to-Date
For the Periods Ended June 30,		2023				2022				%				2023				2022				%
Operating/Performance Statistics
Freight car velocity (daily miles per car)*			202				187				8	%			199				192				4	%
Average train speed (miles per hour)*			24.1				23.6				2				24.1				23.9				1
Average terminal dwell time (hours)*			23.3				24.6				(5)				23.6				24.3				(3)
Locomotive productivity (GTMs per horsepower day)			126				123				2				125				126				(1)
Gross ton-miles (GTMs) (millions)			207,606				209,789				(1)				414,254				419,495				(1)
Train length (feet)			9,316				9,439				(1)				9,238				9,321				(1)
Intermodal car trip plan compliance (%)**			79				62				17	pts			76				67				9	pts
Manifest/Automotive car trip plan compliance (%)**			64				56				8	pts			63				59				4	pts
Workforce productivity (car miles per employee)			983				1,034				(5)				987				1,045				(6)
Total employees (average)			32,060				30,715				4				31,766				30,452				4
Locomotive Fuel Statistics
Average fuel price per gallon consumed		$	2.86			$	4.03				(29)	%		$	3.04			$	3.48				(13)	%
Fuel consumed in gallons (millions)			226				226				-				458				460				-
Fuel consumption rate***			1.086				1.076				1				1.105				1.096				1
Revenue Ton-Miles (Millions)
Grain & grain products			18,858				19,459				(3)	%			38,902				40,488				(4)	%
Fertilizer			2,953				3,115				(5)				6,089				6,266				(3)
Food & refrigerated			4,514				4,257				6				9,057				8,959				1
Coal & renewables			20,864				20,558				1				43,361				44,808				(3)
Bulk			47,189				47,389				-				97,409				100,521				(3)
Industrial chemicals & plastics			7,214				7,685				(6)				14,305				15,244				(6)
Metals & minerals			9,209				9,662				(5)				18,156				18,407				(1)
Forest products			5,815				6,694				(13)				11,364				13,319				(15)
Energy & specialized markets			9,817				9,105				8				19,316				18,171				6
Industrial			32,055				33,146				(3)				63,141				65,141				(3)
Automotive			4,687				4,140				13				9,087				8,287				10
Intermodal			17,567				18,710				(6)				35,687				36,628				(3)
Premium			22,254				22,850				(3)				44,774				44,915				-
Total			101,498				103,385				(2)	%			205,324				210,577				(2)	%

*	Surface Transportation Board (STB) reported performance measures.
**	Methodology used to report is not comparable with the reporting to the STB under docket number EP 770.
***	Fuel consumption is computed as follows: gallons of fuel consumed divided by gross ton-miles in thousands.

 

UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES Condensed Consolidated Statements of Income (unaudited)
	2023
Millions, Except Per Share Amounts and Percentages,	1st Qtr			2nd Qtr		Year-to-Date
Operating Revenues
Freight revenues	$	5,656		$	5,569		$	11,225
Other revenues		400			394			794
Total operating revenues		6,056			5,963			12,019
Operating Expenses
Compensation and benefits		1,179			1,269			2,448
Fuel		766			664			1,430
Purchased services and materials		653			650			1,303
Depreciation		572			577			1,149
Equipment and other rents		235			248			483
Other		357			351			708
Total operating expenses		3,762			3,759			7,521
Operating Income		2,294			2,204			4,498
Other income, net		184			93			277
Interest expense		(336)			(339)			(675)
Income before income taxes		2,142			1,958			4,100
Income tax expense		(512)			(389)			(901)
Net Income	$	1,630		$	1,569		$	3,199
Share and Per Share
Earnings per share - basic	$	2.67		$	2.58		$	5.25
Earnings per share - diluted	$	2.67		$	2.57		$	5.24
Weighted average number of shares - basic		610.6			608.7			609.6
Weighted average number of shares - diluted		611.5			609.5			610.5
Dividends declared per share	$	1.30		$	1.30		$	2.60
Operating Ratio		62.1	%		63.0	%		62.6	%
Effective Tax Rate		23.9	%		19.9	%		22.0	%

 

UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES Freight Revenues Statistics (unaudited)
	2023
	1st Qtr			2nd Qtr		Year-to-Date
Freight Revenues (Millions)
Grain & grain products	$	943		$	890		$	1,833
Fertilizer		186			183			369
Food & refrigerated		263			255			518
Coal & renewables		505			429			934
Bulk		1,897			1,757			3,654
Industrial chemicals & plastics		536			545			1,081
Metals & minerals		536			562			1,098
Forest products		332			347			679
Energy & specialized markets		613			632			1,245
Industrial		2,017			2,086			4,103
Automotive		587			625			1,212
Intermodal		1,155			1,101			2,256
Premium		1,742			1,726			3,468
Total	$	5,656		$	5,569		$	11,225
Revenue Carloads (Thousands)
Grain & grain products		202			197			399
Fertilizer		45			48			93
Food & refrigerated		44			44			88
Coal & renewables		216			203			419
Bulk		507			492			999
Industrial chemicals & plastics		157			164			321
Metals & minerals		188			210			398
Forest products		52			55			107
Energy & specialized markets		139			144			283
Industrial		536			573			1,109
Automotive		200			213			413
Intermodal [a]		734			749			1,483
Premium		934			962			1,896
Total		1,977			2,027			4,004
Average Revenue per Car
Grain & grain products	$	4,668		$	4,527		$	4,598
Fertilizer		4,135			3,830			3,978
Food & refrigerated		5,963			5,740			5,851
Coal & renewables		2,341			2,107			2,228
Bulk		3,743			3,568			3,657
Industrial chemicals & plastics		3,402			3,336			3,368
Metals & minerals		2,853			2,677			2,760
Forest products		6,384			6,337			6,360
Energy & specialized markets		4,408			4,388			4,398
Industrial		3,760			3,646			3,701
Automotive		2,944			2,928			2,935
Intermodal [a]		1,573			1,471			1,521
Premium		1,866			1,794			1,829
Average	$	2,861		$	2,748		$	2,804

[a]	For intermodal shipments each container or trailer equals one carload.

 

UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES Non-GAAP Measures Reconciliation to GAAP
Debt / Net Income
Millions, Except Ratios		Jun. 30,				Dec. 31,
for the Trailing Twelve Months Ended [a]		2023				2022
Debt		$	33,302			$	33,326
Net income			6,732				6,998
Debt / net income			4.9				4.8
Adjusted Debt / Adjusted EBITDA*
Millions, Except Ratios		Jun. 30,				Dec. 31,
for the Trailing Twelve Months Ended [a]		2023				2022
Net income		$	6,732			$	6,998
Add:
Income tax expense			1,981				2,074
Depreciation			2,281				2,246
Interest expense			1,323				1,271
EBITDA		$	12,317			$	12,589
Adjustments:
Other income, net			(493)				(426)
Interest on operating lease liabilities [b]			53				54
Adjusted EBITDA		$	11,877			$	12,217
Debt		$	33,302			$	33,326
Operating lease liabilities			1,563				1,631
Unfunded pension and OPEB, net of tax cost of $0 and $0			-				-
Adjusted debt		$	34,865			$	34,957
Adjusted debt / Adjusted EBITDA			2.9				2.9

[a]	The trailing twelve months income statement information ended June 30, 2023, is recalculated by taking the twelve months ended December 31, 2022, subtracting the six months ended June 30, 2022, and adding the six months ended June 30, 2023.
[b]	Represents the hypothetical interest expense we would incur (using the incremental borrowing rate) if the property under our operating leases were owned or accounted for as finance leases.
*	Total debt plus operating lease liabilities plus after-tax unfunded pension and OPEB (other postretirement benefit) obligations divided by net income plus income tax expense, depreciation, amortization, interest expense, and adjustments for other income and interest on operating lease liabilities. Adjusted debt to adjusted EBITDA (earnings before interest, taxes, depreciation, amortization, and adjustments for other income and interest on operating lease liabilities) is considered non-GAAP financial measure by SEC Regulation G and Item 10 of SEC Regulation S-K and may not be defined and calculated by other companies in the same manner. We believe this measure is important to management and investors in evaluating the Company's ability to sustain given debt levels (including leases) with the cash generated from operations. In addition, a comparable measure is used by rating agencies when reviewing the Company's credit rating. Adjusted debt to adjusted EBITDA should be considered in addition to, rather than as a substitute for, other information provided in accordance with GAAP. The most comparable GAAP measure is debt to net income ratio. The tables above provide a reconciliation from net income to adjusted EBITDA, debt to adjusted debt, and debt to net income to adjusted debt to adjusted EBITDA. At June 30, 2023, and December 31, 2022, the incremental borrowing rate on operating lease liabilities was 3.4% and 3.3%, respectively.

 

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SOURCE Union Pacific Corporation

FAQ

What is Union Pacific Corporation's stock symbol?

The company's stock symbol is NYSE: UNP.

What were the financial results for the second quarter of 2023?

The company reported a 5% decrease in operating revenue, with a net income of $1.6 billion, or $2.57 per diluted share.

What factors impacted the company's financial results?

The financial results were impacted by softening consumer markets, inflation, and increased workforce levels.

What is the company's outlook for 2023?

The company's outlook for 2023 is pressured by challenging demand and cost environment, with consumer-related volumes expected to drive full-year volume expectations below Industrial Production.