Market Overview

Canadian Pacific's First Quarter Profit Jumps 25 Percent

Canadian Pacific's First Quarter Profit Jumps 25 Percent

Canadian Pacific Railway Ltd (NYSE: CP) reports generally positive results in its first quarter

  • Profit up
  • Revenue up
  • Diluted EPS up
  • Total revenue up
  • Operating expenses up


First quarter 2019 profit for Canadian Pacific jumped 25 percent compared with the same period in 2018 amid a 6 percent increase in revenue. These results occurred despite adverse weather conditions that hampered rail movements during the quarter.

Net income totaled C$434 million in the first quarter of 2019, compared with C$348 million for the first quarter of 2018. (All monetary figures are reported in Canadian dollars; a Canadian dollar is currently valued at US$0.75.) Diluted earnings per share (EPS) in the first quarter totaled $3.09 per share, compared with $2.41 per share in the first quarter of 2018.

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Total revenue was nearly $1.77 billion in the first quarter of 2019, compared with $1.66 billion for the same period a year ago. Operating expenses were $1.22 billion, an increase when compared with $1.12 billion in the first quarter of 2018.

First quarter operating ratio was 69.3 percent, compared with 67.5 percent in the first quarter of 2018. (The lower the operating ratio the better, so the first quarter of 2019's results were not as good as the first quarter of 2018.)

"This past winter was one of the most challenging in my railroading career," CP president and chief executive officer Keith Creel said. "I applaud our employees for their resiliency in overcoming loss and pushing through extraordinary conditions and challenges throughout February and March. Our commitment to precision scheduled railroading enabled a strong recovery, and gives us a solid foundation moving forward."

Average train speed increased to 21.1 miles per hour (mph) in the first quarter, compared with 20.6 mph in the first quarter of 2018. Average terminal dwell, or the amount of time a train stayed at a terminal, was unchanged at 7.9 hours.

First quarter freight revenues rose for grain, coal, forest products, energy and plastics and chemicals, and automotive and intermodal, but they fell for potash, fertilizers and sulfur and the category of metals, minerals and consumer products. Freight revenue per ton mile rose for all categories except potash and automotive; intermodal was flat year-over-year.

Carload volumes for almost all commodities fell in the first quarter of this year compared with the first quarter of 2018, except for potash, forest products and the category of energy, chemicals and plastics.

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Image sourced from Pixabay

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Posted-In: Freight Freightwaves Logistics Q1 earningsEarnings News Markets General


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