CN posts Q4 2023 financial, operating results

CN yesterday reported financial and operating results for fourth-quarter 2023.

The Class I posted Q4 revenue of C$4.5 billion, down 2%; net income of C$2.1 billion, up 50%; and C$3.29 diluted earnings per share (EPS), up 57%, compared with Q4 2022 results.

Adjusted Q4 net income came in at C$1.3 billion, down 8%, and adjusted diluted EPS totaled C$2.02, down 4%. The railroad posted operating income of C$1.8 billion, down 5%; and an operating ratio of 59.3%, up 1.4 points.

The company attributed the Q4 revenue decline primarily to lower shipments of intermodal and grain, lower container storage fees and lower fuel surcharge revenue as a result of lower fuel prices. Those declines were partly offset by freight rate increases and higher shipments of potash, natural gas liquids and refined petroleum products.

Operating expenses in Q4 climbed 1% to C$2.7 billion when compared to the same period in 2022. The increase was due mainly to higher labor and fringe benefits expenses driven by general wage increases and higher average headcount, as well as higher personal injury and legal claim provisions.

"Through 2023, our team of dedicated railroaders leveraged our scheduled operating model to deliver exceptional service for our customers and remained resilient in the face of numerous external challenges," CN President and CEO Tracy Robinson said in a press release.

In terms of operating performance, CN improved across most measures in Q4 2023 compared with Q4 2022:
• revenue ton miles of 61,136 (millions), up 2%;
• train length of 7,951 feet, up 1%;
• through network train speed of 19.6 mph, which was flat;
• car velocity of 215 car miles per day, a 4% improvement;
• through dwell of 6.9 (entire railroad, hours), a 4% improvement;
• fuel efficiency of 0.874 (U.S. gallons of locomotive fuel consumed per 1,000 gross ton miles), a 1% improvement;
• accident rate of 1.51 per million train miles, a 29% improvement; and
• injury frequency rate at a record low of 0.79 (per 200,000 person hours), a 14% improvement.

"Looking forward, we are optimistic as CN specific growth initiatives are producing volumes. While economic uncertainty persists, we have the momentum to deliver sustainable profitable growth in 2024," Robinson said.