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Rail News Home Canadian National Railway - CN


Rail News: Canadian National Railway - CN

CN 1Q profit rises, will boost infrastructure investment


CN posted a solid performance in first-quarter 2015, which saw net income increase 13 percent to $704 million (in Canadian dollars), or 86 cents per diluted share, compared with net income of $623 million, or 75 cents per diluted share, in first-quarter 2014.

Diluted earnings per share for the quarter rose 30 percent compared with first-quarter 2014's adjusted earnings per share of 66 cents, which excluded a gain on a rail line sale.

First-quarter revenue increased 15 percent to $3.1 billion from $2.69 billion; revenue ton-miles grew by 7 percent; and carloadings increased 9 percent. The operating ratio for the quarter improved by 3.9 points to 65.7 from 69.6 in the year-ago quarter.
"CN turned in a solid first-quarter performance thanks to strong freight demand and continued productivity improvements, helped in part by easier winter conditions compared with last year's polar vortex," said President and Chief Executive Officer Claude Mongeau in a prepared statement.

The company affirmed its outlook for double-digit earnings-per-share growth in 2015 versus 2014's adjusted earnings per share of $3.76, despite weaker-than-expected energy markets and a mixed economy, Mongeau said.

The Class I also announced that it would raise its planned capital spending for the year to $2.7 billion, up $100,000 from a previously announced forecast of $2.6 billion to improve infrastructure. The railroad has experienced a number of derailments recently.

Also, CN lowered its forecast for growth in energy-related products, namely crude oil and frac sand. It now assumes shipments of those two commodities will grow by 40,000 carloads versus 2014, compared with its assumption announced Jan. 27 of 75,000 carloads for 2015.

The company assumes total carload growth for all freight categories in 2015 will be 3 percent compared with its Jan. 27 forecast of 3 percent to 4 percent.

Contact Progressive Railroading editorial staff.

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