Delivers best first quarter financial results in company's
history
CALGARY, April 22, 2014 /PRNewswire/ - Canadian Pacific
Railway Limited (TSX: CP) (NYSE: CP) today announced record Q1 2014
financial results.
Reported net income in the first quarter was $254 million, or $1.44 per diluted share, versus $217 million, or $1.24 per share, in the first quarter of 2013.
This represents a 16 per cent year-over year improvement in
earnings per share.
FIRST-QUARTER 2014 RESULTS COMPARED WITH FIRST-QUARTER 2013:
- Total revenues were $1,509
million, an increase of 1 per cent
- Operating expenses were $1,086
million, a decrease of 4 per cent
- Operating income was $423
million, an increase of 17 per cent
- Operating ratio was 72.0 per cent, a 380 basis point
improvement
"CP delivered solid results in a period that was severely
impacted by extraordinary cold and severe winter weather
conditions," said E. Hunter
Harrison, Chief Executive Officer. "In the face of such
difficult operating conditions, I am particularly proud of the
women and men of CP who remained on the job 24/7, to keep the
railway operating."
"Despite a slow start to the year and the reduced capacity which
limited our ability to meet strong customer demand, we still have
the utmost confidence in our ability to achieve our financial
targets for 2014."
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, purchases of common shares for cancellation
under CP's share repurchase program, future sources of capital,
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 or
headings such as "financial expectations", "key assumptions",
"anticipate", "believe", "expect", "plan", "will", "outlook",
"should" 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; changes in
commodity prices; uncertainty surrounding timing and volumes of
commodities being shipped via CP; 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; 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) is a transcontinental railway in
Canada and the United States with direct links to eight
major ports, including Vancouver
and Montreal, providing North
American customers a competitive rail service with access to key
markets in every corner of the globe. CP is a low-cost provider
that is growing with its customers, offering a suite of freight
transportation services, logistics solutions and supply chain
expertise. Visit www.cpr.ca to see the rail advantages of Canadian
Pacific.
INTERIM CONSOLIDATED STATEMENTS OF
INCOME
(in millions of Canadian dollars, except per share data)
(unaudited)
|
|
|
For the three months |
|
|
|
ended March 31 |
|
|
|
2014 |
|
|
2013 |
|
|
|
|
Revenues |
|
|
|
|
|
|
Freight |
$ |
1,474 |
|
$ |
1,459 |
|
Other |
|
35 |
|
|
36 |
Total revenues |
|
1,509 |
|
|
1,495 |
Operating expenses |
|
|
|
|
|
|
Compensation and benefits (Note
2) |
|
355 |
|
|
402 |
|
Fuel |
|
271 |
|
|
270 |
|
Materials |
|
89 |
|
|
72 |
|
Equipment rents |
|
41 |
|
|
46 |
|
Depreciation and amortization |
|
141 |
|
|
141 |
|
Purchased services and other |
|
189 |
|
|
202 |
Total operating expenses |
|
1,086 |
|
|
1,133 |
|
|
|
|
|
|
|
Operating income |
|
423 |
|
|
362 |
Less: |
|
|
|
|
|
|
Other income and charges |
|
- |
|
|
3 |
|
Net interest expense |
|
70 |
|
|
70 |
Income before income tax
expense |
|
353 |
|
|
289 |
|
|
|
|
|
|
|
Income tax expense (Note
3) |
|
99 |
|
|
72 |
Net income |
$ |
254 |
|
$ |
217 |
|
|
|
|
|
|
|
Earnings per share (Note
4) |
|
|
|
|
|
|
Basic earnings per share |
$ |
1.45 |
|
$ |
1.25 |
|
Diluted earnings per share |
$ |
1.44 |
|
$ |
1.24 |
|
|
|
|
|
|
|
Weighted-average number of shares
(millions) (Note 4) |
|
|
|
|
|
|
Basic |
|
175.5 |
|
|
174.3 |
|
Diluted |
|
177.0 |
|
|
175.8 |
|
|
|
|
|
|
|
Dividends declared per
share |
$ |
0.3500 |
|
$ |
0.3500 |
|
|
|
|
|
|
|
See Notes to Interim Consolidated
Financial Statements. |
|
|
|
|
|
INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME
(in millions of Canadian dollars)
(unaudited)
|
|
For the three
months |
|
|
ended March 31 |
|
|
|
2014 |
|
|
2013 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
$ |
254 |
|
$ |
217 |
|
|
|
|
|
|
|
|
Net loss on foreign currency
translation |
|
|
|
|
|
|
adjustments, net of
hedging activities |
|
- |
|
|
(2) |
|
|
|
|
|
|
|
|
Change in derivatives designated as
cash flow hedges |
|
(1) |
|
|
1 |
|
|
|
|
|
|
|
|
Change in pension and post-retirement
defined benefit |
|
|
|
|
|
|
plans |
|
31 |
|
|
188 |
|
|
|
|
|
|
|
|
Other comprehensive income before
income tax expense |
|
30 |
|
|
187 |
|
|
|
|
|
|
|
|
Income tax recovery (expense) |
|
8 |
|
|
(40) |
|
|
|
|
|
|
|
Other comprehensive income (Note
2) |
|
38 |
|
|
147 |
|
|
|
|
|
|
|
Comprehensive income |
$ |
292 |
|
$ |
364 |
|
|
|
|
|
|
|
See Notes to Interim Consolidated
Financial Statements. |
|
|
|
|
|
INTERIM CONSOLIDATED BALANCE SHEETS AS AT MARCH 31, 2014
(in millions of Canadian dollars)
(unaudited)
|
|
March 31 |
|
December 31 |
|
|
2014 |
|
2013 |
Assets |
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and cash equivalents |
$ |
279 |
|
$ |
476 |
|
Restricted cash and cash
equivalents |
|
409 |
|
|
411 |
|
Accounts receivable, net |
|
723 |
|
|
580 |
|
Materials and supplies |
|
190 |
|
|
165 |
|
Deferred income taxes (Note
3) |
|
345 |
|
|
344 |
|
Other current assets |
|
64 |
|
|
53 |
|
|
|
2,010 |
|
|
2,029 |
|
|
|
|
|
|
|
Investments |
|
98 |
|
|
92 |
Properties |
|
13,518 |
|
|
13,327 |
Assets held for sale |
|
230 |
|
|
222 |
Goodwill and intangible
assets |
|
168 |
|
|
162 |
Pension asset (Note 8) |
|
1,092 |
|
|
1,028 |
Other assets |
|
199 |
|
|
200 |
Total assets |
$ |
17,315 |
|
$ |
17,060 |
|
|
|
|
|
|
|
Liabilities and shareholders'
equity |
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
Accounts payable and accrued
liabilities |
$ |
1,144 |
|
$ |
1,189 |
|
Long-term debt maturing within one
year (Note 6) |
|
95 |
|
|
189 |
|
|
|
1,239 |
|
|
1,378 |
|
|
|
|
|
|
|
Pension and other benefit liabilities
(Note 8) |
|
663 |
|
|
657 |
Other long-term liabilities |
|
348 |
|
|
338 |
Long-term debt (Note 6) |
|
4,774 |
|
|
4,687 |
Deferred income taxes |
|
3,028 |
|
|
2,903 |
Total liabilities |
|
10,052 |
|
|
9,963 |
|
|
|
|
|
|
|
Shareholders' equity |
|
|
|
|
|
|
Share capital (Note 5) |
|
2,253 |
|
|
2,240 |
|
Additional paid-in capital |
|
36 |
|
|
34 |
|
Accumulated other comprehensive loss
(Note 2) |
|
(1,465) |
|
|
(1,503) |
|
Retained earnings |
|
6,439 |
|
|
6,326 |
|
|
|
7,263 |
|
|
7,097 |
Total liabilities and
shareholders' equity |
$ |
17,315 |
|
$ |
17,060 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contingencies (Note 9) |
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Interim Consolidated
Financial Statements. |
|
|
|
|
|
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions of Canadian dollars)
(unaudited)
|
|
For the three
months |
|
|
ended March
31 |
|
|
2014 |
|
|
2013 |
Operating activities |
|
|
|
|
|
|
Net income |
$ |
254 |
|
$ |
217 |
|
Reconciliation of net
income to cash provided by operating activities: |
|
|
|
|
|
|
|
Depreciation and amortization |
|
141 |
|
|
141 |
|
|
Deferred income taxes (Note
3) |
|
89 |
|
|
63 |
|
|
Pension funding in excess of expense
(Note 8) |
|
(32) |
|
|
(9) |
|
Other operating
activities, net |
|
17 |
|
|
2 |
|
Change in non-cash
working capital balances related to operations |
|
(182) |
|
|
(147) |
Cash provided by operating
activities |
|
287 |
|
|
267 |
|
|
|
|
|
|
|
Investing activities |
|
|
|
|
|
|
Additions to
properties |
|
(224) |
|
|
(203) |
|
Proceeds from sale of
properties and other assets |
|
5 |
|
|
16 |
|
Change in restricted cash
and cash equivalents used to collateralize letters of credit |
|
2 |
|
|
- |
|
Other |
|
- |
|
|
(25) |
Cash used in investing
activities |
|
(217) |
|
|
(212) |
|
|
|
|
|
|
|
Financing activities |
|
|
|
|
|
|
Dividends paid |
|
(61) |
|
|
(61) |
|
Issuance of CP common
shares |
|
14 |
|
|
40 |
|
Purchase of CP common
shares (Note 5) |
|
(85) |
|
|
- |
|
Repayment of long-term
debt |
|
(143) |
|
|
(19) |
Cash used in financing
activities |
|
(275) |
|
|
(40) |
|
|
|
|
|
|
|
Effect of foreign currency
fluctuations on U.S. dollar-denominated cash and cash |
|
8 |
|
|
(1) |
equivalents |
|
|
|
|
|
Cash position |
|
|
|
|
|
|
(Decrease) increase in
cash and cash equivalents |
|
(197) |
|
|
14 |
|
Cash and cash equivalents
at beginning of period |
|
476 |
|
|
333 |
Cash and cash equivalents at end of
period |
$ |
279 |
|
$ |
347 |
|
|
|
|
|
|
|
Supplemental disclosures of cash
flow information: |
|
|
|
|
|
|
Income taxes paid |
$ |
9 |
|
$ |
4 |
|
Interest paid |
$ |
72 |
|
$ |
66 |
|
|
|
|
|
|
|
See Notes to Interim Consolidated
Financial Statements. |
|
|
|
|
|
INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN
SHAREHOLDERS' EQUITY
(in millions of Canadian dollars, except common share
amounts)
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common |
|
|
|
|
|
Accumulated |
|
|
|
|
|
shares |
|
|
|
Additional |
other |
|
|
Total |
|
(in |
|
Share |
paid-in |
comprehensive |
Retained |
shareholders' |
|
millions) |
|
capital |
capital |
loss |
earnings |
equity |
Balance at January 1, 2014 |
175.4 |
|
$ |
2,240 |
$ |
34 |
$ |
(1,503) |
$ |
6,326 |
$ |
7,097 |
Net income |
- |
|
|
- |
|
- |
|
- |
|
254 |
|
254 |
Other comprehensive income (Note 2) |
- |
|
|
- |
|
- |
|
38 |
|
- |
|
38 |
Dividends declared |
- |
|
|
- |
|
- |
|
- |
|
(61) |
|
(61) |
Effect of stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
expense |
- |
|
|
- |
|
6 |
|
- |
|
- |
|
6 |
CP common shares repurchased (Note 5) |
(0.6) |
|
|
(7) |
|
- |
|
- |
|
(80) |
|
(87) |
Shares issued under stock option |
|
|
|
|
|
|
|
|
|
|
|
|
plans |
0.3 |
|
|
20 |
|
(4) |
|
- |
|
- |
|
16 |
Balance at March 31, 2014 |
175.1 |
|
$ |
2,253 |
$ |
36 |
$ |
(1,465) |
$ |
6,439 |
$ |
7,263 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common |
|
|
|
|
|
Accumulated |
|
|
|
|
|
shares |
|
|
|
Additional |
other |
|
|
Total |
|
(in |
|
Share |
paid-in |
comprehensive |
Retained |
shareholders' |
|
millions) |
|
capital |
capital |
loss |
earnings |
equity |
Balance at January 1, 2013 |
173.9 |
|
$ |
2,127 |
$ |
41 |
$ |
(2,768) |
$ |
5,697 |
$ |
5,097 |
Net income |
- |
|
|
- |
|
- |
|
- |
|
217 |
|
217 |
Other comprehensive income (Note 2) |
- |
|
|
- |
|
- |
|
147 |
|
- |
|
147 |
Dividends declared |
- |
|
|
- |
|
- |
|
- |
|
(62) |
|
(62) |
Effect of stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
expense |
- |
|
|
- |
|
6 |
|
- |
|
- |
|
6 |
Shares issued under stock option |
|
|
|
|
|
|
|
|
|
|
|
|
plans |
0.8 |
|
|
56 |
|
(12) |
|
- |
|
- |
|
44 |
Balance at March 31, 2013 |
174.7 |
|
$ |
2,183 |
$ |
35 |
$ |
(2,621) |
$ |
5,852 |
$ |
5,449 |
|
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Interim Consolidated
Financial Statements. |
|
|
|
|
|
|
|
|
CANADIAN PACIFIC RAILWAY LIMITED
NOTES TO INTERIM CONSOLIDATED FINANCIAL
STATEMENTS
March 31, 2014
(unaudited)
1 |
Basis of presentation |
|
|
|
These unaudited interim consolidated financial
statements of Canadian Pacific Railway Limited ("CP", or "the
Company"), expressed in Canadian dollars, reflect management's
estimates and assumptions that are necessary for their fair
presentation in conformity with generally accepted accounting
principles in the United States of America ("GAAP"). They do
not include all disclosures required under GAAP for annual
financial statements and should be read in conjunction with the
2013 annual consolidated financial statements. The accounting
policies used are consistent with the accounting policies used in
preparing the 2013 annual consolidated financial statements. |
|
|
|
CP's operations can be affected by seasonal
fluctuations such as changes in customer demand and weather-related
issues. This seasonality could impact quarter-over-quarter
comparisons. |
|
|
|
In management's opinion, the unaudited interim
consolidated financial statements include all adjustments
(consisting of normal and recurring adjustments) necessary to
present fairly such information. Interim results are not
necessarily indicative of the results expected for the fiscal
year. |
|
|
2 |
Changes in accumulated other comprehensive
loss ("AOCL") by component |
|
|
|
|
For the three months ended March
31 |
|
(in millions of Canadian
dollars) |
Foreign
currency net of
hedging
activities(1) |
Derivatives and
other(1) |
Pension and
post-
retirement
defined
benefit
plans(1)(2) |
Total(1) |
|
January 1, 2014 |
$ 105 |
$ (15) |
$ (1,593) |
$ (1,503) |
|
Other comprehensive income |
|
|
|
|
|
before
reclassifications |
17 |
10 |
- |
27 |
|
Amounts reclassified from |
|
|
|
|
|
accumulated
other |
|
|
|
|
|
comprehensive loss |
- |
(11) |
22 |
11 |
|
Net current-period other |
|
|
|
|
|
comprehensive
income (loss) |
17 |
(1) |
22 |
38 |
|
March 31, 2014 |
$ 122 |
(16) |
(1,571)
|
(1,465)
|
|
January 1, 2013 |
$ 74 |
$ (14) |
$ (2,828) |
$ (2,768) |
|
Other comprehensive income
(loss) |
|
|
|
|
|
before
reclassifications |
8 |
(7) |
94 |
95 |
|
Amounts reclassified from |
|
|
|
|
|
accumulated
other |
|
|
|
|
|
comprehensive loss |
- |
6 |
46 |
52 |
|
Net current-period other |
|
|
|
|
|
comprehensive income (loss) |
8 |
(1) |
140 |
147 |
|
March 31, 2013 |
$ 82 |
$ (15) |
$ (2,688) |
$ (2,621) |
|
|
|
|
|
|
|
(1)Amounts are presented
net of tax. |
|
(2) Amounts reclassified
from accumulated other comprehensive loss. |
|
|
|
|
|
|
For the three months
ended
March 31 |
|
|
2014
|
2013 |
|
Amortization of prior service
costs(a) |
$ (17) |
$ (6) |
|
Recognition of net actuarial
loss(a) |
48 |
67 |
|
Total before income tax |
31 |
61 |
|
Income tax recovery |
(9) |
(15) |
|
Net of income tax |
$ 22 |
$ 46 |
|
|
|
|
|
(a)Impacts
Compensation and benefits on the Interim Consolidated Statements of
Income. |
3 |
Income
taxes |
|
|
|
|
For the three months |
|
|
ended March 31 |
|
|
|
2014 |
|
2013 |
|
(in millions of Canadian
dollars) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Current income tax expense |
|
$ |
10 |
|
$ |
9 |
|
Deferred income tax expense |
|
|
89 |
|
|
63 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
$ |
99 |
|
$ |
72 |
|
|
|
|
|
|
|
|
|
The effective income tax rate for the three months
ended March 31, 2014 was 28.0% (three months ended March 31, 2013 -
24.8%). The lower rate in 2013 was the result of a benefit
recognized for a U.S. federal track maintenance credit of $6
million for 2012 enacted and reported in the first quarter of
2013. |
4 |
Earnings per share |
|
|
|
At March 31, 2014, the number of shares outstanding
was 175.1 million (March 31, 2013 - 174.7 million). |
|
|
|
Basic earnings per share have been calculated using
net income for the period divided by the weighted- average number
of shares outstanding during the period. |
|
|
|
The number of shares used in earnings per share
calculations is reconciled as follows: |
|
|
|
|
|
For the three months
ended March 31 |
|
(in millions) |
2014 |
2013 |
|
|
|
|
|
Weighted-average basic
shares |
|
|
|
outstanding
|
175.5 |
174.3 |
|
Dilutive effect of stock
options |
1.5 |
1.5 |
|
|
|
|
|
|
|
|
|
Weighted-average diluted
|
177.0 |
175.8 |
|
shares
outstanding |
|
|
|
|
|
|
|
For the three months ended March 31, 2014,122,017
options were excluded from the computation of diluted
earnings per share because their effects were not dilutive (three
months ended March 31, 2013 - no
options). |
5 |
Shareholders' Equity |
|
|
|
On February 20, 2014, the Board of Directors of the Company
approved a share repurchase program, and in March 2014, the Company
filed a new normal course issuer bid to purchase, for cancellation,
up to 5.3 million of its outstanding common shares. Under the
filing, share purchases may be made during the 12-month period that
began March 17, 2014, and ends March 16, 2015. The purchases
are made at the market price on the day of purchase, with
consideration allocated to share capital up to the average carrying
amount of the shares, and any excess allocated to retained
earnings. |
|
|
|
The following table provides the activity under the share
repurchase program: |
|
|
|
|
|
|
|
For the three months |
|
|
|
ended March 31 |
|
|
|
|
2014 |
|
|
|
|
|
|
Number of common shares
repurchased |
|
|
567,750 |
|
Weighted-average price per
share(1) |
|
$ |
154.07 |
|
Amount of repurchase (in
millions)(1) |
|
$ |
87 |
|
|
|
|
|
(1) Includes brokerage fees. |
6 |
Financial instruments |
|
|
|
A. Fair values of
financial instruments |
|
|
|
The Company categorizes its financial assets and liabilities
measured at fair value in line with the fair value hierarchy
established by GAAP that prioritizes, with respect to reliability,
the inputs to valuation techniques used to measure fair
value. This hierarchy consists of three broad levels.
Level 1 inputs consist of quoted prices (unadjusted) in active
markets for identical assets and liabilities and give the highest
priority to these inputs. Level 2 and 3 inputs are based on
significant other observable inputs and significant unobservable
inputs, respectively, and give lower priority to these inputs. |
|
|
|
When possible, the estimated fair value is based on quoted
market prices and, if not available, estimates from third party
brokers. For non-exchange traded derivatives classified in
Level 2, the Company uses standard valuation techniques to
calculate fair value. Primary inputs to these techniques
include observable market prices (interest, foreign exchange and
commodity) and volatility, depending on the type of derivative and
nature of the underlying risk. The Company uses inputs and
data used by willing market participants when valuing derivatives
and considers its own credit default swap spread as well as those
of its counterparties in its determination of fair value. |
|
|
|
The carrying values of financial instruments equal or
approximate their fair values with the exception of long-term debt
which has a fair value of approximately $5,715 million at March 31,
2014 (December 31, 2013 - $5,572 million) and a carrying value of
$4,869 million at March 31, 2014 (December 31, 2013 - $4,876
million). The estimated fair value of current and long-term
borrowings has been determined based on market information where
available, or by discounting future payments of interest and
principal at estimated interest rates expected to be available to
the Company at period end. All derivatives and long-term debt
are classified as Level 2. |
|
|
|
B. Financial risk management |
|
|
|
Derivative financial instruments |
|
Derivative financial instruments may be used to selectively
reduce volatility associated with fluctuations in interest rates,
foreign exchange ("FX") rates, the price of fuel and stock-based
compensation expense. Where derivatives are designated as
hedging instruments, the relationship between the hedging
instruments and their associated hedged items is documented, as
well as the risk management objective and strategy for the use of
the hedging instruments. This documentation includes linking
the derivatives that are designated as fair value or cash flow
hedges to specific assets or liabilities on the Interim
Consolidated Balance Sheets, commitments or forecasted
transactions. At the time a derivative contract is entered
into, and at least quarterly thereafter, an assessment is made
whether the derivative item is effective in offsetting the changes
in fair value or cash flows of the hedged items. The
derivative qualifies for hedge accounting treatment if it is
effective in substantially mitigating the risk it was designed to
address. |
|
|
|
It is not the Company's intent to use financial derivatives or
commodity instruments for trading or speculative purposes. |
|
|
|
Foreign exchange management |
|
The Company conducts business transactions and owns assets in
both Canada and the United States. As a result, the Company
is exposed to fluctuations in value of financial commitments,
assets, liabilities, income or cash flows due to changes in FX
rates. The Company may enter into foreign exchange risk
management transactions primarily to manage fluctuations in the
exchange rate between Canadian and U.S. currencies. FX
exposure is primarily mitigated through natural offsets created by
revenues, expenditures and balance sheet positions incurred in the
same currency. Where appropriate, the Company may negotiate
with customers and suppliers to reduce the net exposure. |
|
|
|
Occasionally the Company may enter into short-term FX forward
contracts as part of its cash management strategy. |
|
|
|
Net investment hedge |
|
The FX gains and losses on long-term debt are mainly unrealized
and can only be realized when U.S. dollar denominated long-term
debt matures or is settled. The Company also has long-term FX
exposure on its investment in U.S. affiliates. The majority
of the Company's U.S. dollar denominated long-term debt has been
designated as a hedge of the net investment in foreign
subsidiaries. This designation has the effect of mitigating
volatility on net income by offsetting long-term FX gains and
losses on U.S. dollar denominated long-term debt and gains and
losses on its net investment. The effective portion
recognized in "Other comprehensive income" for the three months
ended March 31, 2014 was an unrealized foreign exchange loss of
$131 million (three months ended March 31, 2013 - $67
million). There was no ineffectiveness during the three
months ended March 31, 2014 and March 31, 2013. |
|
|
|
Foreign exchange forward contracts |
|
The Company may enter into FX forward contracts to lock-in the
amount of Canadian dollars it has to pay on its U.S. denominated
debt maturities. |
|
|
|
At March 31, 2014, the Company had FX forward contracts to fix
the exchange rate on US$175 million of its 6.50% Notes due in May
2018, and US$100 million of its 7.25% Notes due in May 2019.
At December 31, 2013, the Company had FX forward contracts to fix
the exchange rate on US$100 million of principal outstanding on a
capital lease due in January 2014, US$175 million of its 6.50%
Notes due in May 2018, and US$100 million of its 7.25% Notes due in
May 2019. These derivatives, which are accounted for as cash
flow hedges, guarantee the amount of Canadian dollars that the
Company will repay when these obligations mature. |
|
|
|
During the three months ended March 31, 2014, the Company
settled the FX forward contract related to the repayment of a
capital lease due in January 2014 for proceeds of $8 million. |
|
|
|
During the three months ended March 31, 2014, the combined
realized and unrealized foreign exchange gain of $11 million (three
months ended March 31, 2013 - unrealized gain of $5 million) was
recorded in "Other income and charges" in relation to these
derivatives. These gains recorded in "Other income and
charges" were largely offset by the realized and unrealized losses
on the underlying debt which the derivatives were designated to
hedge. |
|
|
|
At March 31, 2014, the unrealized gain derived from these FX
forwards was $27 million which was recorded in "Other assets" with
the offset reflected as an unrealized gain of $4 million in
"Accumulated other comprehensive loss" and as an unrealized gain of
$23 million in "Retained earnings". At December 31, 2013, the
unrealized gain derived from these FX forwards was $25 million of
which $6 million was included in "Other current assets" and $19
million in "Other assets" with the offset reflected as an
unrealized gain of $5 million in "Accumulated other comprehensive
loss" and as an unrealized gain of $20 million in "Retained
earnings". |
|
|
|
At March 31, 2014, the Company expected that, during the next
twelve months, unrealized pre-tax losses of $1 million would be
reclassified to "Other income and charges". |
7 |
Stock-based compensation |
|
|
|
At March 31, 2014, the Company had several stock-based
compensation plans, including stock option plans, various cash
settled liability plans and an employee stock savings plan.
These plans resulted in an expense for the three months ended March
31, 2014 of $22 million (three months ended March 31, 2013 - $33
million). |
|
|
|
Regular options |
|
In the first three months of 2014, under CP's stock option
plans, the Company issued 366,050 regular options at the weighted
average price of $168.88 per share, based on the closing price on
the grant date. |
|
|
|
Pursuant to the employee plan, these regular options may be
exercised upon vesting, which is between 12 months and 48 months
after the grant date, and will expire after 10 years. |
|
|
|
Under the fair value method, the fair value of the regular
options at the grant date was approximately $17 million. The
weighted average fair value assumptions were approximately: |
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three
months |
|
|
|
|
|
|
ended March, 31 2014 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Grant price |
|
$ |
168.88 |
|
|
|
|
Expected option life
(years)(1) |
|
|
5.82 |
|
|
|
|
Risk-free interest
rate(2) |
|
|
1.64 |
% |
|
|
|
Expected stock price
volatility(3) |
|
|
28.63 |
% |
|
|
|
Expected annual dividends per
share(4) |
|
$ |
1.40 |
|
|
|
|
Expected forfeiture
rate(5) |
|
|
1.4 |
% |
|
|
|
|
(1) Represents the period of time that awards are
expected to be outstanding. Historical data on exercise
behaviour, or when available, specific expectations regarding
future exercise behaviour, were used to
estimate the expected life of the option. |
|
(2) Based on the implied yield available on
zero-coupon government issues with an equivalent remaining
term at the time of the grant. |
|
(3) Based on the historical stock price volatility
of the Company's stock over a period commensurate with the
expected term of the option. |
|
(4) Determined by the current annual dividend at the
time of grant. The Company does not employ different
dividend yields throughout the contractual term of the option. |
|
(5) The Company estimated forfeitures based on past
experience. This rate is monitored on a periodic basis. |
|
|
|
Performance share unit ("PSU") plan |
|
In the three months ended March 31, 2014, the Company issued
163,760 PSUs with a grant date fair value of approximately $25
million. These units attract dividend equivalents in the form
of additional units based on the dividends paid on the Company's
Common Shares. PSUs vest and are settled in cash, or in CP
common shares approximately three years after the grant date,
contingent upon CP's performance (performance factor). The
fair value of PSUs is measured, both on the grant date and each
subsequent quarter until settlement, using a Monte Carlo simulation
model. The model utilizes multiple input variables that
determine the probability of satisfying the performance and market
conditions stipulated in the grant. |
|
|
|
Deferred share unit ("DSU") plan |
|
In the three months ended March 31, 2014, the Company granted
46,034 DSUs with a grant date fair value of approximately $7.5
million. DSUs vest over various periods of up to 48 months
and are only redeemable for a specified period after employment is
terminated. An expense to income for DSUs is recognized over
the vesting period for both the initial subscription price and the
change in value between reporting periods. |
8 |
Pensions and other benefits |
|
|
|
In the three months ended March 31, 2014, the
Company made contributions of $19 million (in the three months
ended March 31, 2013 - $30 million) to its defined benefit pension
plans. The elements of net periodic benefit cost for defined
benefit pension plans and other benefits recognized in the quarter
included the following components: |
|
|
|
|
|
|
|
For the three months |
|
|
|
ended March 31 |
|
|
|
Pensions |
|
|
Other benefits |
|
(in millions of Canadian
dollars) |
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current service cost (benefits |
|
|
|
|
|
|
|
|
|
|
|
|
earned by employees in
the |
|
|
|
|
|
|
|
|
|
|
|
|
period) |
$ |
27 |
|
$ |
35 |
|
$ |
3 |
|
$ |
4 |
|
Interest cost on benefit
obligation |
|
119 |
|
|
112 |
|
|
6 |
|
|
5 |
|
Expected return on fund assets |
|
(189) |
|
|
(186) |
|
|
- |
|
|
- |
|
Recognized net actuarial loss |
|
47 |
|
|
66 |
|
|
1 |
|
|
1 |
|
Amortization of prior service
costs |
|
(17) |
|
|
(6) |
|
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net periodic benefit cost
(recovery) |
$ |
(13) |
|
$ |
21 |
|
$ |
10 |
|
$ |
10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
9 |
Contingencies |
|
|
|
In the normal course of its operations, the Company becomes
involved in various legal actions, including claims relating to
injuries and damage to property. The Company maintains provisions
it considers to be adequate for such actions. While the final
outcome with respect to actions outstanding or pending at March 31,
2014 cannot be predicted with certainty, it is the opinion of
management that their resolution will not have a material adverse
effect on the Company's financial position or results of operations
individually and in aggregate. |
|
|
|
On July 6, 2013, a train carrying crude oil operated by
Montreal Maine and Atlantic Railway ("MM&A") derailed and
exploded in Lac-Megantic, Quebec on a section of railway line owned
by MM&A. The day before CP had interchanged the train to
MM&A, but after the interchange MM&A exercised exclusive
control over the train. |
|
|
|
Following this incident, the Minister of Sustainable
Development, Environment, Wildlife and Parks of Quebec issued an
order directing named parties to recover the contaminants and to
clean up and decontaminate the derailment site. CP was later
added as a named party in the administrative action on August 14,
2013. |
|
|
|
A class action lawsuit has also been filed in the Superior
Court of Quebec on behalf of a class of persons and entities
residing in, owning or leasing property in, operating a business in
or physically present in Lac-Megantic. The lawsuit seeks
damages caused by the derailment including for wrongful deaths,
personal injuries, and property damages. CP was added as a
defendant on August 16, 2013. In the wake of the derailment
and ensuing litigation, MM&A filed for bankruptcy in Canada and
the United States. |
|
|
|
At this early stage in the legal proceedings, any potential
liability and the quantum of potential loss cannot be
determined. Nevertheless, CP denies liability for MM&A's
derailment and will vigorously defend itself in both proceedings or
any proceeding that may be commenced in the future. |
|
|
|
Environmental remediation accruals cover site-specific
remediation programs. Environmental remediation accruals are
measured on an undiscounted basis and are recorded when the costs
to remediate are probable and reasonably estimable. |
|
|
|
The accruals for environmental remediation represent CP's best
estimate of its probable future obligation and include both
asserted and unasserted claims, without reduction for anticipated
recoveries from third parties. Although the recorded accruals
include CP's best estimate of all probable costs, CP's total
environmental remediation costs cannot be predicted with
certainty. Accruals for environmental remediation may change
from time to time as new information about previously untested
sites becomes known, environmental laws and regulations evolve and
advances are made in environmental remediation technology.
The accruals may also vary as the courts decide legal proceedings
against outside parties responsible for contamination. These
potential charges, which cannot be quantified at this time, are not
expected to be material to CP's financial position, but may
materially affect income in the particular period in which a charge
is recognized. Costs related to existing, but as yet unknown,
or future contamination will be accrued in the period in which they
become probable and reasonably estimable. |
|
|
|
The expense included in "Purchased services and other" for the
three months ended March 31, 2014 was $1 million (three months
ended March 31, 2013 - $1 million). Provisions for
environmental remediation costs are recorded in "Other long-term
liabilities", except for the current portion which is recorded in
"Accounts payable and accrued liabilities". The total amount
provided at March 31, 2014 was $93 million (December 31, 2013 - $
90 million). Payments are expected to be made over 10 years
to 2024. |
Summary of Rail Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter |
|
Financial (millions, except per share
data) |
|
2014 |
|
2013 |
|
Fav/(Unfav) |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
Freight revenue |
|
$ |
1,474 |
|
$ |
1,459 |
|
$ |
15 |
|
1 |
|
Other revenue |
|
|
35 |
|
|
36 |
|
|
(1) |
|
(3) |
Total revenues |
|
|
1,509 |
|
|
1,495 |
|
|
14 |
|
1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits |
|
|
355 |
|
|
402 |
|
|
47 |
|
12 |
|
Fuel |
|
|
271 |
|
|
270 |
|
|
(1) |
|
- |
|
Materials |
|
|
89 |
|
|
72 |
|
|
(17) |
|
(24) |
|
Equipment rents |
|
|
41 |
|
|
46 |
|
|
5 |
|
11 |
|
Depreciation and amortization |
|
|
141 |
|
|
141 |
|
|
- |
|
- |
|
Purchased services and other |
|
|
189 |
|
|
202 |
|
|
13 |
|
6 |
Total operating expenses |
|
|
1,086 |
|
|
1,133 |
|
|
47 |
|
4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
423 |
|
|
362 |
|
|
61 |
|
17 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income and charges |
|
|
- |
|
|
3 |
|
|
3 |
|
100 |
|
Net interest expense |
|
|
70 |
|
|
70 |
|
|
- |
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax expense |
|
|
353 |
|
|
289 |
|
|
64 |
|
22 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
|
99 |
|
|
72 |
|
|
(27) |
|
(38) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
254 |
|
$ |
217 |
|
$ |
37 |
|
17 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating ratio (%) |
|
|
72.0 |
|
|
75.8 |
|
|
3.8 |
|
380 |
bps |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share |
|
$ |
1.45 |
|
$ |
1.25 |
|
$ |
0.20 |
|
16 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share |
|
$ |
1.44 |
|
$ |
1.24 |
|
$ |
0.20 |
|
16 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares Outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares outstanding (millions) |
|
|
175.5 |
|
|
174.3 |
|
|
1.2 |
|
1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of diluted shares outstanding
(millions) |
|
|
177.0 |
|
|
175.8 |
|
|
1.2 |
|
1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign Exchange |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average foreign exchange rate (US$/Canadian$) |
|
|
0.92 |
|
|
0.99 |
|
|
0.07 |
|
7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average foreign exchange rate (Canadian$/US$) |
|
|
1.09 |
|
|
1.01 |
|
|
0.08 |
|
8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First
Quarter |
|
|
|
|
|
2014 |
|
2013 |
Fav/(Unfav) |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commodity Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Freight Revenues
(millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
- Grain |
|
$ |
327 |
|
$ |
314 |
$ |
13 |
|
4 |
|
|
|
- Coal |
|
|
148 |
|
|
149 |
|
(1) |
|
(1) |
|
|
|
- Fertilizers and sulphur |
|
|
134 |
|
|
152 |
|
(18) |
|
(12) |
|
|
|
- Industrial and consumer
products |
|
|
412 |
|
|
372 |
|
40 |
|
11 |
|
|
|
- Automotive |
|
|
88 |
|
|
97 |
|
(9) |
|
(9) |
|
|
|
- Forest products |
|
|
48 |
|
|
53 |
|
(5) |
|
(9) |
|
|
|
- Intermodal |
|
|
317 |
|
|
322 |
|
(5) |
|
(2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Freight
Revenues |
|
$ |
1,474 |
|
$ |
1,459 |
$ |
15 |
|
1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Millions of Revenue
Ton-Miles (RTM) |
|
|
|
|
|
|
|
|
|
|
|
|
|
- Grain |
|
|
8,385 |
|
|
8,430 |
|
(45) |
|
(1) |
|
|
|
- Coal |
|
|
5,441 |
|
|
5,640 |
|
(199) |
|
(4) |
|
|
|
- Fertilizers and sulphur |
|
|
4,367 |
|
|
4,952 |
|
(585) |
|
(12) |
|
|
|
- Industrial and consumer
products |
|
|
9,277 |
|
|
9,536 |
|
(259) |
|
(3) |
|
|
|
- Automotive |
|
|
514 |
|
|
604 |
|
(90) |
|
(15) |
|
|
|
- Forest products |
|
|
920 |
|
|
1,223 |
|
(303) |
|
(25) |
|
|
|
- Intermodal |
|
|
5,471 |
|
|
5,778 |
|
(307) |
|
(5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total RTMs |
|
|
34,375 |
|
|
36,163 |
|
(1,788) |
|
(5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Freight Revenue per
RTM (cents) |
|
|
|
|
|
|
|
|
|
|
|
|
|
- Grain |
|
|
3.90 |
|
|
3.73 |
|
0.17 |
|
5 |
|
|
|
- Coal |
|
|
2.72 |
|
|
2.64 |
|
0.08 |
|
3 |
|
|
|
- Fertilizers and sulphur |
|
|
3.07 |
|
|
3.06 |
|
0.01 |
|
- |
|
|
|
- Industrial and consumer
products |
|
|
4.44 |
|
|
3.90 |
|
0.54 |
|
14 |
|
|
|
- Automotive |
|
|
17.23 |
|
|
16.09 |
|
1.14 |
|
7 |
|
|
|
- Forest products |
|
|
5.18 |
|
|
4.33 |
|
0.85 |
|
20 |
|
|
|
- Intermodal |
|
|
5.79 |
|
|
5.58 |
|
0.21 |
|
4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Freight Revenue per
RTM |
|
|
4.29 |
|
|
4.04 |
|
0.25 |
|
6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carloads
(thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
- Grain |
|
|
101 |
|
|
108 |
|
(7) |
|
(6) |
|
|
|
- Coal |
|
|
78 |
|
|
81 |
|
(3) |
|
(4) |
|
|
|
- Fertilizers and sulphur |
|
|
43 |
|
|
49 |
|
(6) |
|
(12) |
|
|
|
- Industrial and consumer
products |
|
|
125 |
|
|
127 |
|
(2) |
|
(2) |
|
|
|
- Automotive |
|
|
30 |
|
|
35 |
|
(5) |
|
(14) |
|
|
|
- Forest products |
|
|
14 |
|
|
18 |
|
(4) |
|
(22) |
|
|
|
- Intermodal |
|
|
227 |
|
|
241 |
|
(14) |
|
(6) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Carloads |
|
|
618 |
|
|
659 |
|
(41) |
|
(6) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Freight Revenue per
Carload |
|
|
|
|
|
|
|
|
|
|
|
|
|
- Grain |
|
$ |
3,238 |
|
$ |
2,906 |
$ |
332 |
|
11 |
|
|
|
- Coal |
|
|
1,897 |
|
|
1,849 |
|
48 |
|
3 |
|
|
|
- Fertilizers and sulphur |
|
|
3,155 |
|
|
3,067 |
|
88 |
|
3 |
|
|
|
- Industrial and consumer
products |
|
|
3,290 |
|
|
2,921 |
|
369 |
|
13 |
|
|
|
- Automotive |
|
|
2,913 |
|
|
2,742 |
|
171 |
|
6 |
|
|
|
- Forest products |
|
|
3,400 |
|
|
3,028 |
|
372 |
|
12 |
|
|
|
- Intermodal |
|
|
1,396 |
|
|
1,339 |
|
57 |
|
4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Freight Revenue per
Carload |
|
$ |
2,385 |
|
$ |
2,214 |
$ |
171 |
|
8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter |
|
|
2014 |
|
2013 (1) |
|
Fav/(Unfav) |
|
% |
|
|
|
|
|
|
|
|
|
Operations Performance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Freight gross ton-miles
(millions) |
|
62,349 |
|
67,679 |
|
(5,330) |
|
(8) |
Revenue ton-miles (millions) |
|
34,375 |
|
36,163 |
|
(1,788) |
|
(5) |
Train miles (thousands) |
|
8,727 |
|
9,993 |
|
(1,266) |
|
(13) |
Average train weight - excluding
local traffic (tons) |
|
7,653 |
|
7,209 |
|
444 |
|
6 |
Average train length - excluding
local traffic (feet) |
|
6,371 |
|
6,298 |
|
73 |
|
1 |
Average terminal
dwell (hours)(2) |
|
10.3 |
|
6.6 |
|
(3.7) |
|
(56) |
Average train speed
(mph)(3) |
|
15.9 |
|
18.0 |
|
(2.1) |
|
(12) |
|
|
|
|
|
|
|
|
|
Locomotive productivity (daily
average GTMs/active HP) |
|
204.3 |
|
205.5 |
|
(1.2) |
|
(1) |
|
|
|
|
|
|
|
|
|
Fuel efficiency(4) |
|
1.11 |
|
1.13 |
|
0.02 |
|
2 |
U.S. gallons of locomotive fuel
consumed (millions)(5) |
|
68.3 |
|
75.7 |
|
7.4 |
|
10 |
Average fuel price (U.S. dollars
per U.S. gallon) |
|
3.63 |
|
3.55 |
|
(0.08) |
|
(2) |
|
|
|
|
|
|
|
|
|
Total employees
(average)(6) |
|
14,246 |
|
14,920 |
|
674 |
|
5 |
Total employees (end of
period)(6) |
|
14,446 |
|
15,112 |
|
666 |
|
4 |
Workforce (end of
period)(7) |
|
14,774 |
|
16,108 |
|
1,334 |
|
8 |
|
|
|
|
|
|
|
|
|
Safety |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FRA personal injuries per 200,000
employee-hours |
|
1.50 |
|
1.74 |
|
0.24 |
|
14 |
FRA train accidents per million
train-miles |
|
0.92 |
|
1.96 |
|
1.04 |
|
53 |
|
|
|
|
|
|
|
|
|
(1) |
Certain prior period figures have been revised to conform with
current presentation or have been updated to reflect new
information. |
(2) |
Incorporates a new reporting definition where average terminal
dwell measures the average time a freight car resides
within terminal boundaries. |
(3) |
Incorporates a new reporting definition where average train
speed measures the line-haul movement from origin to
destination including terminal dwell hours. |
(4) |
Fuel efficiency is defined as U.S. gallons of locomotive fuel
consumed per 1,000 GTMs - freight and yard. |
(5) |
Includes gallons of fuel consumed from freight, yard and
commuter service but excludes fuel used in capital projects and
other non-freight activities. |
(6) |
An employee is defined as an individual, including trainees,
who has worked more than 40 hours in a standard biweekly
pay period. This excludes part time employees, contractors,
and consultants. |
(7) |
Workforce is defined as total employees plus part time
employees, contractors, and consultants. |
SOURCE Canadian Pacific