Canadian Pacific Railway Limited (TSX: CP) (NYSE: CP) today announced record second-quarter earnings driven by strong top-line growth and continued margin improvements produced by its industry-leading operating model and its 12,000 talented railroaders.
Revenues climbed 13 percent to $1.64 billion, while net income rose 46 percent to $480 million, or $3.27 per diluted share, the highest ever for the period. Adjusted earnings per share rose 35 percent to $2.77 per diluted share.
"This quarter's impressive results demonstrate the power of precision railroading," said Keith Creel, CP's President and Chief Executive Officer. "Strong volumes across many of our key business segments, combined with disciplined cost control, produced record operating income and earnings for the quarter."
SECOND-QUARTER HIGHLIGHTS
- Total revenues grew 13 percent to $1.64 billion
- Operating ratio improved 330 basis points to a second-quarter record of 58.7 percent
- Operating income increased 23 percent to $679 million, a second-quarter record
- Adjusted income climbed 30 percent to $407 million, with adjusted diluted earnings per share increasing 35 percent to $2.77
- Cash from operations for the first six months rose to $922 million from $730 million a year earlier, supporting a gain in free cash flow to $361 million from $173 million in the same period
"We are off to a strong start in 2017 and remain confident that our team of committed railroaders will continue to safely and efficiently deliver results for our customers and shareholders in the second half of the year and beyond," Creel said.
The company will discuss its results with the financial community in a
conference call beginning at: 4:30 p.m. eastern time (2:30 p.m. mountain time) on July 19.
Conference Call Access
Toronto participants dial in number: 1-647-427-7450
Operator assisted toll free dial in number: 1-888-231-8191
Callers should dial in 10 minutes prior to the call.
Webcast
We encourage you to access the webcast and presentation material at
investor.cpr.ca
A replay of the second-quarter conference call will be available by phone through to August 19, 2017 at 416-849-0833 or toll free 1-855-859-2056, password 98435596.
Access to the webcast and audio file of the presentation will be made available at
investor.cpr.ca
Non-GAAP Measures
For further information regarding non-GAAP measures, including reconciliations to the nearest GAAP measures, see the attached supplementary schedule Non-GAAP Measures.
Note on forward-looking information
This news release contains certain forward-looking information within the meaning of applicable securities laws relating, but not limited, to our operations, priorities and plans, anticipated financial performance, including our 2017 full-year guidance, business prospects, planned capital expenditures, programs and strategies. This forward-looking information also includes, but is not limited to, statements concerning expectations, beliefs, plans, goals, objectives, assumptions and statements about possible future events, conditions, and results of operations or performance. Forward-looking information may contain statements with words or headings such as "financial expectations", "key assumptions", "anticipate", "believe", "expect", "plan", "will", "outlook", "should" or similar words suggesting future outcomes. To the extent that CP has provided guidance using non-GAAP financial measures, the Company may not be able to provide a reconciliation to a GAAP measure, due to unknown variables and uncertainty related to future results.
Undue reliance should not be placed on forward-looking information as actual results may differ materially from the forward-looking information. Forward-looking information is not a guarantee of future performance. By its nature, CP's forward-looking information involves numerous assumptions, inherent risks and uncertainties that could cause actual results to differ materially from the forward looking information, including but not limited to the following factors: changes in business strategies; general North American and global economic, credit and business conditions; risks in agricultural production such as weather conditions and insect populations; the availability and price of energy commodities; the effects of competition and pricing pressures; industry capacity; shifts in market demand; changes in commodity prices; uncertainty surrounding timing and volumes of commodities being shipped via CP; inflation; changes in laws and regulations, including regulation of rates; changes in taxes and tax rates; potential increases in maintenance and operating costs; uncertainties of investigations, proceedings or other types of claims and litigation; labour disputes; risks and liabilities arising from derailments; transportation of dangerous goods; timing of completion of capital and maintenance projects; currency and interest rate fluctuations; effects of changes in market conditions and discount rates on the financial position of pension plans and investments; and various events that could disrupt operations, including severe weather, droughts, floods, avalanches and earthquakes as well as security threats and governmental response to them, and technological changes. The foregoing list of factors is not exhaustive. These and other factors are detailed from time to time in reports filed by CP with securities regulators in Canada and the United States. Reference should be made to "Item 1A - Risk Factors" and "Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations - Forward-Looking Information" in CP's annual and interim reports on Form 10-K and 10-Q. Readers are cautioned not to place undue reliance on forward-looking information. Forward looking information is based on current expectations, estimates and projections and it is possible that predictions, forecasts, projections, and other forms of forward-looking information will not be achieved by CP. Except as required by law, CP undertakes no obligation to update publicly or otherwise revise any forward-looking information, whether as a result of new information, future events or otherwise.
About Canadian Pacific
Canadian Pacific Railway Limited (TSX:CP)(NYSE:CP) is a transcontinental railway in Canada and the United States with direct links to eight major ports, including Vancouver and Montreal, providing North American customers a competitive rail service with access to key markets in every corner of the globe. CP is growing with its customers, offering a suite of freight transportation services, logistics solutions and supply chain expertise. Visit www.cpr.ca to see the rail advantages of CP. CP-IR.