Canadian National profit sinks as demand plunges

NEW YORK - Canadian National Railway Co. said Thursday its fourth-quarter earnings sank 31 percent, hurt by plunging shipping demand and comparison to a one-time gains a year ago.

Montreal-based Canadian National said it earned 573 million Canadian dollars ($468.9 million), or 1.21 Canadian dollars (99 cents) per share, compared with 833 million Canadian dollars, or 1.68 Canadian dollars per share a year ago.

Excluding tax gains from both periods, the company reported adjusted earnings of 531 million Canadian ($434.5 million), or 1.12 Canadian dollars (92 cents) per share, compared with $444 million Canadian, or 90 Canadian cents per share a year earlier.

Revenue rose 13 percent to 2.2 billion Canadian dollars ($1.8 billion), from 1.94 billion Canadian dollars a year ago.

Thomson Reuters says analysts expected profit of 82 cents per share on revenue of $1.69 billion. Analysts typically exclude one-time items from their estimates.

Revenue was aided by foreign currency gains, freight rate hikes and lower fuel costs. But these factors were countered by sinking demand. Shipping volume fell by about 10 percent in the period compared with a year earlier. Sales gains were also offset by a payment and fines related to a reduction in grain shipping rates required by the Canadian Transportation Authority.

"To meet our long-term objectives, we will continue to maintain pricing discipline and pursue opportunities that extend beyond business-cycle considerations," President and Chief Executive E. Hunter Harrison said in a statement. "At the same time we will continue to do what's necessary to manage our assets and costs effectively in response to lower traffic volumes.

Shares of Canadian National fell 13 cents to $31.80 in aftermarket electronic trading after closing down 29 cents at $31.93 in the regular session.

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