CN 3rd Quarter Net Income Up, Traffic Down

Canadian National reported that its third quarter 2016 net income was C$972 million, or C$1.25 per diluted share, compared with net income of C$1.01 billion, or C$1.26 per diluted share for the third quarter of 2015.

Canadian NationalCN’s operating income fell 5 percent to C$1.41 billion while revenue revenues decreased by 6 percent to C$3.01 billion. Carloadings declined 4 percent and revenue ton-miles were down 3 percent.

Operated expenses dropped by 7 percent to C$1.61 billion.

CN said it posted a record 53.3 percent operating ratio, a 0.5-point improvement over the prior-year quarter’s performance. Free cash flow for the first nine months of 2016 was C$1.74 billion, which was flat compared with the year-earlier period.

“With solid execution from our industry-leading operating team and a network-wide focus on providing quality service, CN delivered outstanding results in the third quarter while facing a still sluggish North American and global economy,” said CN CEO and President Luc Jobin, in a statement.

Jobin said the challenges that CN faced during the quarter included shifting traffic demands and a delayed Canadian grain harvest

“We also continued to reinvest in our business and infrastructure, investments that are driving ongoing safety, service and productivity improvements, while we maintained our commitment to providing the long-term value that helps CN and its customers succeed,” he said.

CN expects a 2016 adjusted diluted earnings per share to be up approximately 1 percent versus last year’s adjusted diluted EPS of C$4.44.

The CN Board of Directors has approved a fourth-quarter 2016 dividend on the company’s common shares outstanding. A quarterly dividend of C$0.375 per common share will be paid on Dec. 30, 2016, to shareholders of record at the close of business on Dec. 9, 2016.

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