Both of Canada’s major railways felt the effects of a weak economy, and capacity constraints, exacerbated by bad weather, and produced somewhat disappointing financial results. Both carriers restated the financials pertaining to the first quarter of 2017, but we chose to maintain them as originally presented. As is evident from the table, net income as a percentage of revenues tumbled from 34 per cent in 2016 to 21 per cent in 2018 at CP, while at CN net income as a percentage of revenues dropped from 26.7 per cent in 2016 to 23.2 per cent in 2018. Both carriers have spent vast sums of cash repurchasing their own shares over the past few years, with CN in particular picking up the pace of these repurchases. Stock repurchases help maintain earnings per share numbers, as the company’s earnings are divided by a reduced number of outstanding shares. On the other hand, as is evident from the numbers, one could argue that share repurchases were financed entirely or in part through borrowed funds, and for that reason, have the effect of weakening the balance sheet, compared to what it would look like without the repurchases. (more…)
By Keith Norbury
Canada’s two major railways are each ramping up their cold chain game. Canadian Pacific Railway in February launched a trademarked TempPro service for perishable products that is being augmented by the purchase this year of more than 400 new 53-foot “SlimLine” reefers. Canadian National Railway, meanwhile, plans to add more equipment to the 2017 addition of 100 reefer units to its CargoCool fleet, which now has 720 units, Senior Media Relations Manager Patrick Waldron said by email. “Each 53-foot CargoCool container offers the power of almost 100 refrigerators and through ReeferTrak, our team has real time visibility to temperatures inside the box, ensuring that perishable cargo is protected at all times,” Mr. Waldron said. (more…)
On April 18, CN announced it will acquire 350 premium boxcars to serve growing demand from industrial customers across its North American network. “These additional boxcars, combined with our new locomotives, hundreds of new train crew members, and track expansion investments, will help give us the capacity and network resiliency we need for pulp, paper and metals customers,” said Doug MacDonald, Vice-President of Bulk at CN. The leased 50-foot, high-capacity plate F boxcars, equipped with 12-foot plug doors, are expected to be delivered beginning in late summer with all the cars in service by the end of 2018. (more…)
By Keith Norbury
The Hudson Bay Railway line proved no match for the uneven, boggy terrain of the Hudson Bay Lowlands this spring. On June 9, a news release from OmniTrax Inc., its owner, said it had suspended service indefinitely on the railway from Amery, 29 rail miles northeast of Gillam, to Churchill — a section it had been unable to operate since May 23. A preliminary assessment by an independent engineering firm found the flooding had washed the track bed away in 19 locations, the release said. The flood “visibly damaged” five bridges with another 30 bridges and 600 culverts needing further assessment.
The CP Holiday Train program launched in 1999, and has since raised more than C$13 million and four million pounds of food for communities along CP’s routes in Canada and the United States.
Beginning in Montreal, Quebec, on November 25 and 26, 2017 respectively, two trains will make the festive journey, travelling through both the U.S. and Canada to bring holiday cheer to 182 communities along CP’s network. Each event is completely free, with CP encouraging every attendee to open their cupboards or wallets to ease hunger needs in their community. Local food banks will be accepting donations at each stop to ensure those less fortunate can access adequate food this holiday season and year-round.
“The Holiday Train program is all about local food banks and food shelves and the critical role they play in our communities,” said Keith Creel, CP’s President and Chief Executive Officer. “People come for the beautifully-lit train and stay for the incredible show – all in the name of community. The holiday season is the best time of the year, and we look forward to bringing together thousands of Canadians and Americans this season for this incredibly important cause and a great time.
The 2017 edition of the Holiday Train also concludes CP’s Canada 150 celebrations and the Canadian train will feature the Spirit of Tomorrow car, which was part of the Canada 150 Train this past summer. For a schedule of stops, kindly visit http://www.cpr.ca/holiday-train/canada
By Alexander Whiteman
Hurricane Harvey failed to derail North American operators as intermodal revenue continued to rise in the third quarter – international shipments bolstering double-digit net income gains. Kansas City Southern stood out as the sector’s star performer, with nine-month revenue up 11 per cent year-on-year, to $1.9 billion, resulting in $411 million in net income for the period. While intermodal revenue for the year to date only showed marginal gains at $266 million, the mode performed better in the third quarter with turnover up 4 per cent to $92.3 million. Revenue for the three months to September climbed 8 per cent to $656 million, with net income up 7 per cent to $129.9 million.