CN profits surprise on higher revenue
Montreal-based rail operator earned $555 million in the first quarter
Canadian National Railway slightly beat expectations as it earned net income of $555 million in the first quarter on a five per cent increase in revenues.
Excluding a $36 million after-tax gain on the sale of a rail line segment, the Montreal-based railway earned $519 million.
The $1.22 per share in adjusted profits were one cent better than forecast by analysts and four cents better than a year ago.
Revenues increased five per cent to $2.47 billion, while revenue ton-miles rose three per cent and carloadings increased two per cent. Including one-time gains, CN net earnings amounted to $1.30 per share, compared with $1.75 per share or $775 million last year when it gained $252 million from the sale of rail lines in the Toronto area.
Operating income declined two per cent to $780 million, while the operating ratio was 68.4 per cent, a deterioration of 2.2 percentage points.
Chief executive Claude Mongeau said the country's largest railway faced a string of operational challenges in the quarter, including extreme cold and heavy snow in Western Canada.
On the Toronto Stock Exchange, CN's shares were down 34 cents at $98.14 in afternoon trading Monday.