Revenue up | Growth follows job cuts
Canadian Pacific Railway reported record first quarter earnings, posting significant year-over-year improvements in total revenue, net income and operating efficiency.
“CP delivered the best first quarter results in its history despite challenging winter conditions,” said chief executive officer Hunter Harrison.
- Net income in the quarter ending March 31 was $217 million, or $1.24 per share, up 51 percent from $142 million, or 82 cents per share, in the same period in 2012.
- Revenue was $1.495 billion, up nine percent.
- Operating ratio, a key measurement of railway efficiency, improved to 75.8 percent from 80.1 percent a year earlier.
- Lower operating ratios reflect a more efficient railroad.
- CP wants to achieve a sustainable operating ratio in the mid-60s by 2016.
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“There remains a lot of work to do as we continue to make significant changes to our operating model. With a very strong start to the year … we are on pace toward the best year-end financial and operating performance in CP’s history,” Harrison said.
The company has reduced its workforce by 3,400 people since Harrison was appointed CEO last summer.
Shortly after joining CP, Harrison announced the company would cut 4,500 jobs by 2016 in an effort to make the railway the most efficient carrier in North America.
Last month, he hinted that job cuts could approach 6,000, a reduction of nearly 30 percent from early 2012 when 19,500 were on the payroll.
CP expects 2013 earnings per share to grow by 40 percent, unchanged from its previous forecast.
There were 659,000 car loads shipped in the quarter of which 108,000 were grain. Grain carloads dropped two percent from the same quarter in 2012.
The railway shipped slightly more U.S. origin grain and a little less Canadian grain.
