For the second quarter of 2012, CN reported revenues of $2,543 million, up by 12.5 per cent compared to the same period of 2011. Net income was $631 million, up 17.3 per cent, and representing 24.8 per cent of revenues, an astonishing achievement.
For the same time period, CP reported revenues of $1,366 million, up by 8.0 per cent compared to the same period of 2011. Net income was $103 million, which represented a decline of 19.5 per cent compared to 2011.
Except for grains and fertilizers, CN registered solid traffic increases in every commodity group during the second quarter, which all recorded double-digit gains in revenue tonne-miles. Overall, revenue tonne-miles increased by eight per cent. CN credited the gains to continued economic growth, market share gains, and a labour disruption at CP. Given its solid performance during the second quarter, and it assumption that economic growth will continue as before, CN has revised its financial outlook for 2012. It now anticipates to deliver up to a 15 per cent increase in adjusted diluted earnings per share over adjusted diluted earnings per share of $4.84 in 2011.
At CP, revenue tonne-miles recorded strong growth in industrial and consumer goods, as well as automotive, but declined in forest products, coal and grains. Overall, revenue tonne-miles increased by one per cent over the second quarter of 2011.
It is evident that CP has been making strides in making productivity improvements during the latest period: average train weights and lengths have increased, train speed has increased, terminal dwell time was down, and car miles per day were up substantially. While these improvements bode well for improved performance in the future, employee productivity was impacted negatively by the mismatch between the number of employees needed and the number of employees on the payroll, thus resulting in a seven per cent reduction in employee productivity.