CP Rail posts record revenues and per-share profits in third quarter
Calgary-based railway earned $622M or $4.35 per diluted share for the quarter ended Sept. 30
Canadian Pacific Railway Ltd. says it earned the highest adjusted per-share profits and revenues of its 137-year history last quarter, helping the country's second largest railroad to overcome the impact earlier this year from service interruptions tied to labour action.
The Calgary-based railway earned $622 million or $4.35 per diluted share for the quarter ended Sept. 30, compared with $510 million or 3.50 per share for the same period a year earlier. Its operating income hit $790 million, a 27 per cent year-over-year increase.
Adjusted earnings rose to $589 million or a record $4.12 per diluted share, two cents better than it forecast earlier this month. The earnings marked a 42 per cent leap from $2.90 per share or $422 million a year earlier, beating the expectations of analysts polled by Thomson Reuters Eikon.
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The quarter showed the success of the railway's operating model, stated CEO Keith Creel.
"It was a record by almost every measure and sets us up well for the remainder of the year and beyond."
Third-quarter revenues grew 19 per cent to $1.9 billion from $1.6 billion.
It was led by a 58 per cent growth in currency adjusted revenues for energy, chemicals and plastics, 24 per cent higher revenues from potash, 20 per cent in automotive, 18 per cent in intermodal, 12 per cent in forest products, seven per cent grain, five per cent metals, minerals, consumer, four per cent coal and two per cent fertilizers and sulphur.
The company is also reporting a record-low quarterly operating ratio, which measures its efficiency, of 58.3 per cent, compared with 61 per cent a year earlier.
Creel said the company foresees continued and sustainable growth across all lines of business.
"We have the foundational underpinnings, and the room to grow, in the weeks, months and years ahead," he said in a news release.
CP Rail says it expects adjusted diluted earnings per share to grow more than 20 per cent this year, up from an earlier guidance of low double-digit growth.