CN Net Income Up 18.4% in 3rd Quarter

Canadian National saw its third-quarter net income rise 18.4 percent to CA$1.1 million from CA$958 million in the same quarter a year ago.

Diluted earnings per share increased 21 percent to CA$1.54 over the 2017 third-quarter mark.

Adjusted net income jumped 11 percent to CA$1.1 million, while adjusted diluted EPS climbed 15 percent to CA$1.50.
CN posted a 14 percent increase in third-quarter revenue to CA$3.7 million, which the railroad attributed to higher volumes in the quarter.

Revenue ton-miles were up 4 percent and carloadings were up 3 percent.

In a news release, CN described the quarter’s results as “solid top-line growth with record revenues.”

Revenue rose on a year-over-year basis for petroleum and chemicals by 25 percent; coal, 25 percent; intermodal, 8 percent; and automotive, 3 percent. Revenue rose 15 percent in the categories of grain and fertilizers, forest products, and metals and minerals.

CN attributed the revenue increase primarily to higher applicable fuel surcharges, freight rate increases, the positive translation impact of a weaker Canadian dollar and higher volumes.

Operating income in the quarter rose 8 percent to CA$1.5 million and operating expenses rose 19 percent to CA$2.2 million.

The operating ratio increased 2.3 points during the third quarter to 59.3 percent compared with OR in the third quarter of 2017.

CEO J.J. Ruest said CN sees “strong opportunities ahead, across multiple existing rail commodities and new supply-chain services.”

“The balance of our expansion projects remains on track for completion before winter and our one team is energized to execute our proven operating model as we meet the growing economic needs of our customers,” he said.

CN is seeking a 2018 adjusted diluted EPS in the range of CA$5.30 to CA$5.45, versus last year’s adjusted diluted EPS of CA$4.99.

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