Canadian Pacific Railway Limited (CP) has reported that revenues for the 2016 third quarter have decreased by 9 percent to $1.55 billion when compared to the third quarter of 2015. Diluted earnings per share (EPS) increased 15 percent to $2.34 from $2.04, and adjusted diluted EPS were up by 1 percent to $2.73 from $2.69.
“Despite decreased revenues, tied to a delayed grain harvest and stiff economic headwinds, our business model continues to perform on the cost side,” said CP’s CEO E. Hunter Harrison. “Our commitment to efficiency, asset optimization, and operational excellence has produced yet another record-low operating ratio.”
CP’s operating ratio of 57.7 percent was the lowest-ever when compared to adjusted operating ratios in previous quarters. In the 2015 third quarter, CP reported an operating ratio of 55.9 percent as a result of the sale of the D&H South, an item excluded from the 2015 third quarter adjusted operating ratio of 59.9 percent.
“Given the delayed grain harvest, lower crude volumes and persistent economic challenges compounded by a strengthening Canadian dollar, we are now expecting mid-single-digit EPS growth this year,” added Harrison. “While disappointed that we will not meet our previous forecast, I am incredibly proud that despite these challenges, CP will deliver its lowest-ever annual operating ratio. Our industry-leading operating plan and continued focus on improving service to our customers means we are well-positioned to capitalize on increasing volumes leading into 2017.”