Canadian National Railway Reports First-Quarter Profit
Canadian National Railway Co. reported first-quarter earnings that beat analysts’ estimates as growing demand for forest products and a weaker Canadian dollar buoyed revenue.
Profit of 86 Canadian cents a share was 1 cent higher than the average of 26 analyst estimates compiled by Bloomberg News. Revenue rose to C$3.1 billion, exceeding the C$3 billion average forecast.
With U.S. revenue accounting for about one-third of the company’s sales, the Canadian dollar’s 8% decline in the latest quarter provided a “tailwind,” Benoit Poirier, an analyst at Desjardins Capital Markets in Montreal, said in an April 6 note.
The results set Canada’s biggest railroad apart from U.S. counterparts, which are being stung by a switch to natural gas from coal and slower growth in oil train traffic. U.S. railroads didn’t post any growth in carloads in the first three months of 2015, according to the Association of American Railroads. Last week, Norfolk Southern Corp. predicted revenue will decline this year.
Canadian National reaffirmed its previous target of at least 10% growth in 2015 per-share profit from last year’s C$3.76. That implies earnings of at least C$4.14.
