“During the third quarter, we delivered strong performance across the operations of our unrivaled North American network, despite dealing with a number of temporary headwinds,” said CPKC President and CEO Keith Creel during a financial report on Oct. 23. The Canadian Class I railroad—formed last year through the combination of Canadian Pacific and Kansas City Southern—continues to see “strong revenue growth,” he said, and “we are doing what we said we would do and generating value for all stakeholders.”
For the three-months ended Sept. 30, 2024, CPKC posted revenues of C$3.5 billion, up 6% from C$3.3 billion in the same quarter last year; diluted earnings per share (EPS) of $0.90, up from $0.84 in 2023; and core adjusted combined diluted EPS of $0.99, up 8% from $0.92 in 2023.
Among CPKC’s other third-quarter 2024 results:
- Reported operating ratio (OR) increased by 120 basis points to 66.1% from 64.9% in third-quarter 2023.
- Core adjusted combined OR increased by 120 basis points to 62.9% from 61.7% in the prior-year period.
- Volumes, as measured in Revenue Ton-Miles (RTMs), rose 4%.
- Federal Railroad Administration (FRA)-reportable personal injury frequency decreased to 0.85 from 1.02 in third-quarter 2023.
- FRA-reportable train accident frequency dropped to 1.27 from 1.38 in the same quarter last year.
- Train speed came it at 18.8 mph, up 6% from third-quarter 2023.
- Terminal Dwell reached 10.3 hours, down 8% from third-quarter 2023.
CPKC reported “strong core performance and results, despite challenges in the quarter,” which included labor issues. The railroad noted that the third quarter also marked the creation of a new rail corridor linking Mexico, Texas and the U.S. Southeast. On Oct. 17, the Surface Transportation Board approved CPKC’s request to acquire from Genesee & Wyoming Class III Meridian & Bigbee Railroad (MNBR) and to operate some 50.4 miles of rail line between Meridian, Miss., and Myrtlewood, Ala.; and CSX Transportation’s request to acquire and operate the MNBR rail line that runs 93.7 miles between Burkville and Myrtlewood, Ala. (see map below).
Also in the third quarter, CPKC conducted its first linehaul hydrogen locomotive test.
2024 Outlook
CPKC said that it now expects RTMs to increase “mid-single digits” vs. 2023 on a combined basis. It continues to expect 2024 core adjusted combined diluted EPS to grow “double digits” vs. 2023 core adjusted combined diluted EPS of $3.84. Additionally, the railroad said capital expenditures will come in at C$2.75 billion.
“I am proud of this team of railroaders for overcoming challenges to still deliver on our guidance,” Keith Creel said. “[A]s we look to close 2024 with growing momentum, we’ve never been more excited about the opportunities ahead. Our strategic initiatives and investments position us well for more growth and success for the remainder of this year, in 2025 and beyond. Fueled by the strength of our dedicated team of railroaders, we are confident in our ability to continue producing results for our customers and long-term value for shareholders.”
Visit CPKC’s Investor Relations webpage for more third-quarter 2024 details.
