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Canadian National profit up 3pc to US$2.79 billion as revenue slips 5pc

CANADA's biggest railway, the Canadian National, posted a three per cent year-on-year net profit increase to C$3.64 billion (US$2.79 billion) in 2016, drawn on revenues of C$12.03 billion, down five per cent.

Fourth quarter profits increased eight per cent year on year to C$1.01 billion, drawn on revenues of C$3.21 billion, up two per cent.

Annual operating profit increased one per cent to C$5.31 billion, while quarterly operating profit rose three per cent to C$1.39 billion.

"Despite facing difficult winter conditions in December, CN delivered very strong fourth-quarter results," said CN president and CEO Luc Jobin.

"We saw weaker volumes during the year, but quickly adjusted as our dedicated team of railroaders maintained its focus on operational efficiency, while continuing to provide quality service to our customers and improve our safety performance," he said.

"Overall, the economy remains challenging, but we remain optimistic and expect to see moderate volume growth in 2017," said Mr Jobin.

Revenues increasedfor grain and fertilisers (14 per cent), automotive (four per cent), and intermodal (one percent). Revenues declined for metals and minerals (six per cent), coal (six per cent),petroleum and chemicals (five per cent), while revenues for forest products remained flat.

Revenue increases were attributed to higher volumes of Canadian grain andUS soybeans, refined petroleum products, finished vehicles, and petroleum coke; as wellas freight rate increases.

"These factors were partly offset by lower volumes of crude oil, US thermal coal, and drilling pipe; and lower applicable fuel surcharge rates. Carloadings for the quarter increased three per cent to 1.36 million.

Revenue ton-miles increased by four per cent, while rail freight revenue per RTM, a measurement of yield defined as revenue earned on the movement of a ton of freight over one mile, decreased by three per cent.