A CN locomotive makes its way through the CN Taschereau yard in Montreal on Nov. 28, 2009.Graham Hughes/The Canadian Press
Canadian National Railway Co. said on Tuesday it aims to deliver high single-digit earnings per share growth in fiscal 2021 and beat quarterly profit as improvement in consumer spending drove volumes.
COVID-19 mandated lockdowns affected railroad volumes in the first half of 2020 owing to low demand for consumer products and industrial goods. However, intermodal and grain shipment picked up pace in the third quarter, which, along with the return of consumer spending, boosted volumes in the later half of the year.
The company’s operating ratio, a closely watched measure of operating expenses as a percentage of revenue, fell to 61.4 per cent from 66 per cent. A higher ratio represents inefficiency.
On an adjusted basis, Canadian National earned $1.43 a share, topping analysts’ average estimate of $1.41, according to Refinitiv data.
Revenue rose to $3.66-billion from $3.58-billion, a year earlier.
Analysts on average expect earnings of $6.29 a share for full-year 2021, according to IBES data from Refinitiv.
Net income at the largest railroad operator in Canada rose to $1.02-billion, or $1.43 a share, in the quarter ended Dec. 31, from $873 million, or $1.22 a share, a year earlier.
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