Newspaper article The Canadian Press

CN Remains Optimistic about Growing Profits in 2013 despite Challenging Winter

Newspaper article The Canadian Press

CN Remains Optimistic about Growing Profits in 2013 despite Challenging Winter

Article excerpt

CN earns $555 million in first quarter

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MONTREAL - Canadian National Railway is maintaining its forecast for a stronger year in 2013 despite suffering a harsh winter that delayed trains and increased costs.

"If the economy stays with us -- which I have no indication is not the case -- we should be able to come in with the full year in line with our guidance and have the back end of the year very strong," CEO Claude Mongeau said Monday during a conference call.

The country's largest railway expects to report high single-digit adjusted earnings per share growth on top of the $5.61 per share it earned last year.

CN (TSX:CNR) reported slightly better than expected results for the first quarter despite heavy snow in Western Canada compared with a mild winter last year.

The company said Monday it earned $555 million or $1.30 per share for the quarter ended March 31. The results compared with a profit of $775 million or $1.75 per share a year ago, when the company gained $252 million from the sale of rail lines in the Toronto area to Metrolinx.

Excluding one-time gains, the Montreal-based railway said it earned $519 million of $1.22 per share for the quarter compared with $523 million of $1.18 per share a year ago when the company had more shares outstanding.

The average analyst estimate had been for a profit of $1.21 per share in adjusted profits, according to Thomson Reuters.

Revenues increased five per cent to $2.47 billion, from $2.35 billion a year ago, while revenue ton-miles rose three per cent and carloadings increased two per cent.

"It's clear that we've had a tough start to the year but this is a strong team and whatever doesn't knock you down makes you stronger and we are as we speak preparing for next winter," Mongeau told analysts from Edmonton where the company will hold its annual meeting on Tuesday.

He said that train velocity and freight car dwell times in yards have since improved as it tries to regain service levels to all its customers. …

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