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CN yesterday reported higher revenue, operating income and earnings per share for fourth-quarter 2020 compared with the same period a year ago.
The Class I reported fourth-quarter revenue increased 2% to CA$3.7 billion; operating income rose 16% (13% on an adjusted basis) to CA$1.4 billion; and diluted earnings per share climbed 17% (14% on an adjusted basis) to CA$1.43, CN officials said in a press release.
The company posted an operating ratio in the quarter of 61.4%, a decrease of 4.6 points (3.8 points on an adjusted basis) compared with the same quarter in 2019.
CN attributed the increase in revenue mainly to record shipments of Canadian grain, increased shipments of U.S. grain, higher international container traffic via the Port of Vancouver and freight rate increases. Those factors were partly offset by lower applicable fuel surcharge rates and lower volumes of petroleum crude.
Revenue ton miles (RTMs), measuring the weight and distance of freight transported by CN, increased 10%. Freight revenue per RTM fell 6%, mainly driven by an increase in the average length of haul, changes in business mix and lower applicable fuel surcharge rates; partly offset by freight rate increases.
Operating expenses for the quarter decreased 5% to CA$2.2 billion. The decrease was attributed mainly to lower fuel costs, as well as lower purchased services and materials expense.
"While the recovery remains uneven across the markets we serve, we are pleased by the momentum in volume demand that grew during the fourth quarter and continues to grow," said CN President and Chief Executive Officer JJ Ruest. "We are increasingly optimistic about 2021 and are reinstating our full-year financial outlook."
CN expects to invest CA$3 billion in capital projects in 2021, Ruest said.