Canadian rail operator, CN, has announced record 3Q15 results with revenues up 3% to just under CAN$3.3 billion. The results were achieved despite a drop in carloadings and revenue ton-miles.
“The revenue performance was mainly attributable to the positive translation impact of the weaker Canadian dollar on US dollar-denominated revenues; freight rate increases; strong overseas intermodal demand, higher volumes of finished vehicle traffic, and increased shipments of lumber and panels to US markets,” the company said.
Coal revenues were down by 13% from CAN$185 million to CAN$161 million on weaker demand for the fuel in North America. Coal carloads totaled 113 000, down 10% from 126 000 in 3Q15.
Year-to-date coal revenues have dropped 18% from CAN$568 million in 3Q14 to CAN$468 million. The falling coal volumes have been more than offset by increases in revenues from other sectors, including a strong 17% increase in revenue from automotive shipments. Year-to-date revenue was CAN9.4 billion, up 6% from CAN$8.9 billion in 2014.
Operating expenses were also lower by 5% on 3Q14 at CAN$1.7 billion due to lower fuel costs and lower casualty and other expenses. CN recorded diesel fuel usage of 98.8 million gal. in the quarter, down from 108.1 million gal. on the same period last year. The average fuel price fell significantly to US$2.58/gal. from US$3.62/gal. in 3Q14.
“CN delivered record third-quarter results thanks to strong team execution in safety and efficiently meeting our customers’ needs while recalibrating resources to the weaker volume requirements,” said Luc Jobin, Executive Vice President and CFO at CN. “With CN’s continued strong performance this year, we are pleased to reaffirm our outlook for double-digit adjusted EPS [earnings per share] growth in 2015 versus last year’s adjusted diluted EPS of CAN$3.76.”
The company provided an update on the health of its President and CEO, Claude Mongeau, who recently underwent surgery to remove a rare type of soft tissue tumor. The company said the operation had been a success and that it expected Mongeau to work early in the new year.
“Claude is upbeat, recovering well and remains engaged in the business,” said Robert Pace, Chairman of CN. “The board has every confidence in the experienced leadership team to continue to deliver strong results and all of us look forward to Claude’s return.”
Edited by Jonathan Rowland.
Read the article online at: https://www.worldcoal.com/handling/28102015/coal-volumes-down-but-revenues-rise-at-cn-3076/