CP, CN book higher Q1 grain revenue, smaller grain handle

First-quarter revenue from grain handling is up at both Canadian Pacific (CP) and Canadian National (CN) Railways as the two companies both reported higher overall quarterly profit.

CP on Tuesday booked overall first-quarter net income of $254 million on revenues of $1.509 billion for the period ending March 31 — the company’s best-ever Q1 result, and up from $217 million on $1.495 billion in the year-earlier period.

CN, also on Tuesday, reported overall first-quarter net income of $623 million on revenues of $2.693 billion, up from $555 million on $2.466 billion during the same period in 2013.

CN for its Q1 reported $431 million in revenue from grain and fertilizer traffic, up six per cent from $408 million in the year-earlier period. Grain and fertilizer carloads hauled were down one per cent at 140,000, for revenue per carload of $3,079, up seven per cent from $2,873 in its 2013 Q1.

CP, for its 2014 Q1, reported $327 million in grain freight revenue, up four per cent from $314 million in the year-earlier period. Grain carloads hauled, however, were down six per cent at 101,000, for increased grain revenue per carload at $3,238, up 11 per cent from $2,906 in its 2013 Q1.

CP’s total Q1 carloads hauled across all segments were down six per cent at 618,000; none of its segments showed an increase in carloads, but revenue per carload was up eight per cent at $2,385.

CN’s total Q1 carloads across all segments rose one per cent to 1.239 million, with revenue per carload rising nine per cent to $2,081. Three segments showed increased carloads hauled: intermodal (457,000, up six per cent), petroleum and chemicals (161,000, up seven per cent) and coal (125,000, up 29 per cent).

“CN delivered solid first-quarter results thanks to a dedicated team of railroaders who laboured long and hard to keep us rolling through the harshest winter in decades,” CN CEO Claude Mongeau said Tuesday in the company’s release.

“The winter of a lifetime took its toll on network capacity and affected all of our customers, but I’m pleased that CN’s recovery is now well underway, with key safety, operating and service metrics returning to pre-winter levels.”

CN said its increase in overall revenues was due mainly to the impact of a weaker Canadian dollar on U.S.-dollar-denominated revenues; freight rate increases; higher freight volumes, due to “strong energy markets and market share gains, particularly in intermodal;” and a higher fuel surcharge due to higher volumes.

“CP delivered solid results in a period that was severely impacted by extraordinary cold and severe winter weather conditions,” CP CEO Hunter Harrison said Tuesday in a separate release. “In the face of such difficult operating conditions, I am particularly proud of the women and men of CP who remained on the job 24/7, to keep the railway operating.

“Despite a slow start to the year and the reduced capacity which limited our ability to meet strong customer demand, we still have the utmost confidence in our ability to achieve our financial targets for 2014.” — AGCanada.com Network


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