CP reports record 4Q18

Fourth quarter 2018 results

• Revenues increased 17% to CAN$2 billion, from CAN$1.7 billion.
• Operating ratio improved by 370 basis points to 56.5%.
• Operating income rose 28% to CAN$874 million, from CAN$682 million.

"CP's impressive fourth quarter operating results are a testament to the hard work and dedication of our 13 000-strong CP family - who continue to safely and efficiently deliver for our customers and the North American economy," said Keith Creel, CP President and CEO. "The power of the CP operating model is evident in the strong performance across the company. We set records across many lines of business in 2018, including Canadian grain, potash and domestic intermodal."

CP continues to focus on a disciplined approach to sustainable, profitable growth – a plan rooted in the foundations of precision scheduled railroading. This approach in 2018 enabled CP to deliver its highest-ever revenues, lowest-ever yearly operating ratio and a 13th consecutive year leading Class 1 railways with the lowest train accident frequency.

Full year results

• Revenues increased 12% to CAN$7.3 billion from CAN$6.6 billion.
• Operating ratio improved to a record 61.3%.
• Diluted EPS decreased 17%to CAN$13.61 from CAN$16.44, while adjusted diluted EPS rose 27% to CAN$14.51 from CAN$11.39.

"2018 was a record by almost every measure and will be remembered as a watershed year for our company," said Creel. "Our record operating results are proof that the CP family is committed to making this company the best it has ever been."

Full year 2019 guidance

• Mid-single digit volume growth, as measured in revenue tonne-miles.
• Capital expenditures of CAN$1.6 billion.

CP's guidance is based on the following key assumptions:

• US-to-Canadian dollar exchange rate of approximately 1.30.
• Effective tax rate of 25.5 - 26%.
• Other components of net periodic benefit recovery to increase by CAN$11 million versus 2018.
• No material land sales.

"Each day I look at our team of railroaders and I am proud to be their CEO," Creel said. "We are entering 2019 with tremendous momentum and a commitment to operating the precision scheduled railroading model in its true form."

CP will discuss its results with the financial community in a conference call beginning at 4:30 pm eastern time (2:30 pm mountain time) on 23 January 2019.

Read the article online at: https://www.drybulkmagazine.com/rail-barge/25012019/cp-reports-record-4q18/