Canadian Pacific Kansas City Limited (CP) reported its first-quarter 2024 financial results, highlighting a significant 55.3% year-over-year surge in revenue to CA$3.52 billion. However, this result fell marginally below the consensus estimate of CA$3.54 billion. Despite the strong revenue growth, CP’s operating ratio increased by 400 basis points (bps) to 67.4% from 63.4% in the same period last year. Similarly, the adjusted operating ratio saw a 50 bps increase to 64%. Keith Creel, CPKC President and Chief Executive Officer, expressed pride in the company’s accomplishments over the past year since its historic combination. He emphasized the team’s success in driving growth as the only railway connecting Canada, the United States, and Mexico. Adjusted combined earnings per share (EPS) reached CA$0.93, marginally higher than the CA$0.90 reported in Q1 2023 but below the consensus estimate of CA$0.94. The company’s operating income rose by a substantial 38.6% year-over-year to CA$1.15 billion, while the margin contracted by 394 bps to 32.6%. CP’s financial performance also included a rise in net cash provided by operating activities to CA$1.015 billion from CA$881 million a year ago. Total Freight Revenue per Revenue Ton-Mile (RTM) increased by 12% year-over-year to 6.61, while Total Freight Revenue per Carload declined by 2% year-over-year to CA$3,195. Adjusted combined free cash reached CA$555 million, an increase from the CA$481 million reported in the same quarter last year. CP’s volumes, measured in Revenue Ton-Miles (RTMs), saw a 1% increase on a combined basis. The company’s Federal Railroad Administration (FRA)-reportable train accident frequency increased to 0.89 from 0.71 year-over-year, and FRA-reportable personal injury frequency also rose to 1.15 from 1.12 year-over-year on a combined basis. In the stock market, CP shares experienced a decline of 5.75% and were trading at $82.68 at the last check on Wednesday.
CP Rail Reports 55.3% Revenue Surge in Q1 2024, Misses Consensus
