Canadian Pacific Railway’s fourth quarter net income spiked 27 percent from a year earlier to $187 million (C$186 million), outpacing a 13 percent rise in revenue to $1.3 billion.
Fred Green, CP’s president and CEO, said the gains are continuing into 2011. “We continue to see strong demand for rail service across all lines of business,” he said. “We are ramping up our resources and making long-term investments in our company to meet growing demand, further improve customer service and achieve our three- to five-year target of a low 70s operating ratio” of expenses relative to receipts.
The company had a 77 percent operating ratio in the fourth quarter, improved from an adjusted 80.6 percent a year earlier.
CP earned $653 million during 2010, up 18 percent on a 13 percent revenue gain to $5 billion.
CP is starting 2011 with a $1 billion capital spending plan, up about 40 percent from what it initially planned to spend in 2010.
Traffic grew 8.7 percent in the fourth quarter from the final 2009 period. Intermodal volume grew 10.5 percent to 266,200 units, and revenue on that business increased 9.9 percent. Intermodal was also CP’s largest revenue generating cargo.
Grain traffic fell 3.1 percent, automotive rose 3.3 percent and a broad grouping of industrial and consumer products grew 10.3 percent.
CP ended the quarter with 15,250 workers across its U.S. and Canada operations, up 4 percent from a year earlier. Like other major rail lines, CP’s freight volume expanded much faster than its workforce as it boosted productivity.
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