CPKC sees profits and revenue jump on stronger volumes

CPKC saw strong international intermodal growth thanks to its Gemini partnership with Maersk and Hapag Lloyd, enjoyed 40% growth in its Mexico Midwest Express domestic cross-border intermodal hotshots, as well as a continued ramp-up in land-bridge traffic between Canada and Mexico.

CPKC’s quarterly operating income increased 6%, to $970 million U.S., as revenue grew 3%, to $2.67 billion U.S., compared to a year ago. Earnings per share surged 37%, to 96 cents.

The railway’s operating ratio was 63.7%, a 1.1-point improvement.

Overall volume was up 6% based on carloads and containers, but 7% when measured by revenue ton-miles.

On a carload basis, the growth was led by a 14% increase in intermodal shipments, an 11% increase in grain, and 9% increase in coal volume. Energy, chemicals, and plastics traffic was flat. The rest of CPKC’s segments — potash; fertilizers; forest products; metals, minerals and consumer products; and automotive — showed declines.

Average train speed was flat, but terminal dwell increased 7% partly due to the impact of congestion in former Kansas City Southern territory in the U.S. after a problematic May 3 computer systems cutover. The tech problems created congestion, missed switches, and significant delays for customers in Louisiana, Texas, and Mississippi.

CPKC has made significant progress clearing up congestion on the legacy KCS lines in the U.S., Chief Operating Officer Mark Redd says, citing a 42% improvement in dwell and a 38% increase in car miles per day.

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Find more articles by Stuart Chirls here.

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