CALGARY, ALBERTA, CANADA — A “disciplined approach to sustainable, profitable growth” served Canadian Pacific Railway Ltd. well in fiscal 2019, allowing the company to generate record revenues and strong year-over-year profit growth.
Net income in the year ended Dec. 31, 2019, totaled C$2.440 billion, equal to C$17.58 per share on the common stock, up 25% from C$1.951 billion, or C$13.65 per share, in fiscal 2018. Fiscal 2019 results included an income tax expense of C$706 million, while 2018 results included an income tax expense of C$637 million.
Revenues increased 6.5% to C$7.792 billion from C$7.316 billion.
CP said it generated C$473 million in revenues from grain shipments in the fourth quarter of fiscal 2019, up from C$453 million in the same period a year ago. For the full year ended Dec. 31, revenues from grain shipments totaled C$1.684 billion, up 8% from C$1.566 billion in the same period a year ago.
“Grain volumes were flat in the quarter, but revenues were up 4%,” John K. Brooks, executive vice-president and chief marketing officer, said during a Jan. 29 conference call with analysts. “Despite a challenging Canadian grain harvest we delivered our single largest quarter in the company’s history with 7.9 million tonnes delivered to the market. This historic quarter capped off a 2019 as the largest Canadian grain and grain product tonnage shipped in any single year of our history. This achievement is a true testament to the dedication of our employees, our investment in the grain industry and collaboration with our customers in driving the most efficient operating model.
“As I look ahead, with the delayed harvest, and, more recently, the extreme wet weather in Vancouver, I expect Canadian grain shipments to remain strong through the first half of 2020.
“In the U.S. side, volumes were up 3%, largely as a result of increased soybean shipments to the PNW (Pacific Northwest) as positive U.S.-China trade settlement talks have helped rally spot grain movements in this export lane.”
Later in the call, Keith E. Creel, president and chief executive officer, said CP sees an opportunity to further grow its grain business.
“We’ve moved five or six trains in the new G3 terminal here recently as they prepare and commission their silos to open up,” he said. “We’ve opened here in 2019, six new 8,500-foot elevators that will primarily service that Vancouver market.”