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10/26/2023
Canadian Pacific Kansas City yesterday reported third-quarter 2023 revenue of CA$3.3 billion and diluted earnings per share of 84 cents, down from 96 cents a year ago.
The company posted net income of CA$780 million, down 12% from CA$891 million in Q3 2022. CPKC’s operating ratio rose to 64.9% in the quarter from 59.3% a year ago.
The railroad’s Federal Railroad Administration-reportable train accident frequency declined 9% to 1.3 from 1.43 in Q3 2022 on a combined basis, while the FRA-reportable personal injury frequency fell 35% to 0.97 from 1.50 in Q3 2022 on a combined basis.
CPKC President and CEO Keith Creel said in a press release that softer macro-economic environment and challenges such as the dockworker strike at the Port of Vancouver impacted the quarter’s earnings. Still, he was pleased with the progress CPKC has made over the past six months since the merger of Canadian Pacific and Kansas City Southern, he said.
The company updated its guidance for the year. CPKC now expects a core adjusted combined diluted EPS to be flat to slightly positive compared to a 2022 core adjusted combined diluted EPS of $3.77.
"Economic headwinds and other near-term challenges, including the Port of Vancouver strike, have weighed on volumes more than we anticipated; therefore, we are adjusting our near-term guidance accordingly," Creel said. "Our enthusiasm for this combination and the long-term value it will produce remains unchanged as we stay focused on executing CPKC's unique and undeniable growth opportunities."