Seriously Flawed Survey with Potentially Skewed Results Does
Not Reflect CP's Strong First Quarter Earnings
CALGARY, April 26, 2012
/PRNewswire/ - Canadian Pacific Railway Limited (TSX: CP) (NYSE:
CP) today issued the following statement in response to an
incomplete and misleading shareholder survey published by Brendan
Wood:
"CP questions the validity of the findings of the incomplete
shareholder survey released today by Brendan Wood.
We believe that this survey, and its potentially skewed results,
does not portray a fair representation of the views of CP's
shareholder base.
Importantly, by Brendan Wood's own admission, 'These data do not
yet include the response to your 1st Quarter earnings
announcement.'1
For the first quarter of 2012, CP delivered earnings per share
of $0.82, an increase of $0.62, or 310%, from the same period in
2011. In spite of seasonality which makes Q1 the most
difficult operating quarter, the Company broke records, saw an
increase in revenues of $213 million,
and improved operating ratio by 1,050 bps during the quarter.
CP notes that the only vote that counts is at the May 17, 2012 annual meeting of shareholders."
CP also noted that the Company's strong earnings, which were
disclosed after the completion of the Brendan Wood shareholder
survey, were well-received by financial analysts2:
- "As the company has highlighted previously, the Q1 operating
metrics showed impressive improvements over both last year and over
the more normalized 2010. Indeed, car miles per day and terminal
dwell were both Q1 records." (Cameron
Doerksen of National Bank, April 20,
2012)
- "By almost all measures, CP reported an impressive quarter as
network, business development, and cost management efforts produced
strong top and bottom line results." (Peter
Nesvold of Jefferies, April 23,
2012)
- "We believe CP will produce materially improved results in 2012
and beyond, assuming success of the company's OR improvement
efforts and normal operating conditions. We believe the potential
for material upside surprises is large through the operating
improvement period. Accordingly, we recommend BUYing CP for
very strong EPS growth in the next 3-5 years and the potential for
upside surprises along the way." (David
Tyerman of Canaccord Genuity, April
23, 2012)
- "Our analysis of CP Rail's operating metrics shows a degree of
improvement that cannot be explained by a mild winter alone.
Fluidity has been fully restored and to the extent that execution
remains on track, ongoing investments in network infrastructure
should enable growth at low incremental costs in coming quarters."
(Fadi Chamoun of BMO Capital
Markets, April 23, 2012)
1 Email from Brendan Wood to Canadian
Pacific, dated April 20,
2012.
2 Permission to use quotes neither sought nor
obtained. [The views expressed and numbers cited by
independent financial analysts are their own and are not
necessarily endorsed by CP. The inclusion of such information in
this release should not be viewed as indicating that CP has
agreed with the contents and conclusions of any such
analysts.]
CP recommends that shareholders vote FOR the Company's
continued forward momentum that is being carried out by the right
management team under the supervision of the right Board.
To do so, vote FOR the election of the director nominees
proposed by CP on the WHITE universal proxy. In
addition, shareholders are encouraged to visit www.CPonTrack.com to
access the Company's Management Proxy Circular and for more
information about CP, the CP management team and its
value-generating Multi-Year Plan.
If you have any questions about the information contained in
this document or require assistance in completing your WHITE
universal proxy, please contact our proxy solicitation agents:
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Georgeson |
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MacKenzie Partners, Inc. |
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TOLL FREE - 1-866-374-9187 or
International Toll Free Number
(outside Canada and
U.S.): 1-866-682-6148 |
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TOLL FREE 1-800-322-2885
or
(212) 929-5500 (Call Collect) |
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email: askus@georgeson.com |
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email: proxy@mackenziepartners.com |
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Note on Forward-Looking Information
This news release contains certain forward-looking information
within the meaning of applicable securities laws relating, but not
limited, to our operations, priorities and plans, anticipated
financial performance, business prospects, planned capital
expenditures, programs and strategies. This forward-looking
information also includes, but is not limited to, statements
concerning expectations, beliefs, plans, goals, objectives,
assumptions and statements about possible future events,
conditions, and results of operations or performance.
Forward-looking information may contain statements with words such
as "anticipate", "believe", "expect", "plan" or similar words
suggesting future outcomes.
Undue reliance should not be placed on forward-looking
information as actual results may differ materially from the
forward-looking information. Forward-looking information is
not a guarantee of future performance. By its nature, CP's
forward-looking information involves numerous assumptions, inherent
risks and uncertainties that could cause actual results to differ
materially from the forward-looking information, including but not
limited to the following factors: changes in business strategies;
general North American and global economic, credit and business
conditions; risks in agricultural production such as weather
conditions and insect populations; the availability and price of
energy commodities; the effects of competition and pricing
pressures; industry capacity; shifts in market demand; inflation;
changes in laws and regulations, including regulation of rates;
changes in taxes and tax rates; potential increases in maintenance
and operating costs; uncertainties of investigations, proceedings
or other types of claims and litigation; labour disputes; risks and
liabilities arising from derailments; transportation of dangerous
goods; timing of completion of capital and maintenance projects;
currency and interest rate fluctuations; effects of changes in
market conditions and discount rates on the financial position of
pension plans and investments, including long-term floating rate
notes; and various events that could disrupt operations, including
severe weather, droughts, floods, avalanches and earthquakes as
well as security threats and governmental response to them, and
technological changes. The foregoing list of factors is not
exhaustive.
These and other factors are detailed from time to time in
reports filed by CP with securities regulators in Canada and the
United States. Reference should be made to
"Management's Discussion and Analysis" in CP's annual and interim
reports, Annual Information Form and Form 40-F. Readers are
cautioned not to place undue reliance on forward-looking
information. Forward-looking information is based on current
expectations, estimates and projections and it is possible that
predictions, forecasts, projections, and other forms of
forward-looking information will not be achieved by CP.
Except as required by law, CP undertakes no obligation to update
publicly or otherwise revise any forward-looking information,
whether as a result of new information, future events or
otherwise.
About Canadian Pacific
Canadian Pacific (TSX:CP)(NYSE:CP) operates a North American
transcontinental railway providing freight transportation services,
logistics solutions and supply chain expertise. Incorporating
best-in-class technology and environmental practices, CP is
re-defining itself as a modern 21st century transportation company
built on safety, service reliability and operational efficiency.
Visit www.CPonTrack.com and see how Canadian Pacific is further
driving shareholder value.
SOURCE Canadian Pacific