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CN profit up 21pc to US$2.5 billion as sales rise 15pc

THE Canadian National Railway (CN) posted a 21.2 per cent year-on-year net profit increase in 2014 to C$3.16 billion (US$2.54 billion), drawn on revenues of C$12.13 billion, up 15 per cent.

Fourth-quarter 2014 net profit increased 32.9 per cent year on year to C$844 million, drawn on quarterly revenues of C$3.20 billion, up 16 per cent.

Full-year 2014 volumes reached record levels, with carloadings up eight per cent and revenue ton-miles up 10 per cent, said the CN statement.

Fourth quarter operating profit increased 30 per cent to C$1.26 million while full-year 2014 operating profit rose 19 per cent to C$4.62 billion.

"CN delivered a strong fourth-quarter 2014 performance, concluding a remarkable year characterised by brutal first quarter winter weather, followed by a strong rebound starting in March, and capped by record full-year freight volumes," said CN president and CEO Claude Mongeau.

We're particularly proud of our solid operating performance that allowed us to move record volumes of western Canadian grain and equally strong US grain shipments.

"We see continued opportunities for growth in energy-related commodities, intermodal traffic, and commodities tied to US housing construction, automotive sales and other consumer spending," said Mr Mongeau.

Revenue increases were attributed to higher freight volumes due to a record 2013-2014 Canadian grain crop, strong energy markets, particularly crude oil and frac sand, new intermodal and automotive business; the positive translation impact of the weaker Canadian dollar on US dollar denominated revenues; and freight rate increases, said CN.

Carloadings for 2014 increased eight per cent over 2013 to 5,625 thousand.

Revenue ton-miles increased 10 per cent year on year. Operating expenses for 2014 increased 12 per cent to C$7.5 billion, mainly due to the negative translation impact of a weaker Canadian dollar on US-dollar-denominated expenses.