Canadian National Reports Revenues Up 5% in Third Quarter

Montreal, QB — Canadian National Railway reported Tuesday, Oct. 19, its financial and operating results for the third quarter ended Sept. 30, showing strong performance across nearly all key metrics.

Adjusted diluted earnings per share ("EPS") of C$1.52 were up 10 percent, an adjusted operating ratio of 59 percent, an improvement of 90 basis points, and revenues of C$3.6 billion, up 5 percent over the third quarter of 2020. All financial numbers are in Canadian dollars ($1 U.S. = $1.24 Canadian).

For the same period, the Company reported a 72 percent year-over-year increase in diluted EPS to C$2.37 and an operating ratio of 62.7 percent.

Financial results highlights Third-quarter 2021 compared to third-quarter 2020

  • Revenues of C$3,591 million, an increase of C$182 million or 5 percent.
  • Operating income of C$1,341 million, a decrease of two per cent, and adjusted operating income of C$1,471 million, an increase of 8 percent on an adjusted basis.
  • Diluted EPS of C$2.37, an increase of 72 percent, and adjusted diluted EPS of C$1.52, an increase of 10 percent.
  • Operating ratio of 62.7 per cent, an increase of 2.8 points, and adjusted operating ratio of 59 percent, an improvement of 0.9 points.
  • Operating income and operating ratio were impacted by transaction-related costs for the terminated CN merger agreement with KCS, a workforce reduction provision, and advisory fees related to shareholder matters.
  • For the nine months ended Sept. 30, 2021, after accounting for all direct and incremental expenses as well as income generated from the merger termination fee, CN recorded additional income of C$705 million (C$616 million after-tax), as a result of its strategic decision to bid for KCS.
  • Free cash flow for the first nine months of 2021 was C$2,034 million compared to C$2,087 million for the same period in 2020.

“CN’s dedicated railroaders produced strong financial and operating results this quarter, despite headwinds from severe wildfires in Western Canada that caused a prolonged disruption to CN’s main line to Vancouver in July," said JJ Ruest, president and CEO of CN.

"We are proud of the team’s efforts and dedication, as well as the progress we are making on executing our strategic plan.

"This includes delivering immediate shareholder value while maintaining our long-term commitment to safety, customer service and sustainable value creation.

"Our entire organization is highly confident that the investments we have made in safety, technology and capacity over the past three years will support the Company in delivering enhanced financial results in the last quarter of this year, as well as in 2022 and beyond.

"Similarly, we believe that we are well positioned to achieve our targets of C$700 million of additional operating income and a 57 percent operating ratio for 2022.

We are already seeing solid progress toward these goals and are working to continue to deliver results to benefit all CN shareholders.”

To read the full report, click here.