Grain News

CN Reports 2Q Net Income of C$717 Million, Up From C$631 in 2Q 2012

Date Posted: July 24, 2013

Montreal—CN (TSX: CNR) (NYSE: CNI) reported July 22 its financial and operating results for the second quarter and six-month period ended June 30, 2013.

Full Report

Second-quarter 2013 highlights

• Second-quarter 2013 net income was C$717 million, or C$1.69 per diluted share, compared with net income of C$631 million, or C$1.44 per diluted share, for second-quarter 2012. The second-quarter 2013 results included a net gain of C$13 million (C$0.03 per diluted share) resulting from a gain on a non-monetary transaction with another railway that was partly offset by the effect of the enactment of higher provincial corporate income tax rates.

• Excluding the net gain, Q2-2013 adjusted diluted earnings per share (EPS) increased 11 per cent to C$1.66 from Q2-2012 adjusted diluted EPS of C$1.50. (1)

• Revenues for the latest quarter increased five per cent to C$2,666 million, driven by a five per cent increase in revenue ton-miles and a two per cent increase in carloadings.

• Operating income increased six per cent to C$1,042 million.

• Operating ratio improved by 0.4 of a point to 60.9 per cent.

• Free cash flow totalled C$437 million for the first half of 2013, compared with free cash flow of C$703 million in the comparable period of 2012.

Claude Mongeau, president and chief executive officer, said: “We executed strongly during the second quarter, with service and operating metrics on a steady improvement trend.

This performance underscores our agenda of Operational and Service Excellence, which is key to achieve solid revenue growth at low incremental cost.

“Looking forward, despite slower volume growth than anticipated, the CN team will maintain a keen focus on growing revenues faster than the overall economy as well as on tightly managing costs to meet our full-year financial outlook.”

2013 financial outlook

CN is maintaining the 2013 financial outlook issued on Jan. 22, 2013, as well as the plan to invest approximately C$2 billion in capital programs in 2013, which was revised upward from C$1.9 billion on April 22, 2013.

For more information, call 905-669-3384.

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