Intermodal buoys CN Q2 performance
Canadian National saw second quarter operating income increase 8 percent to $926 million, the railroad said in its quarterly financial filings Tuesday.
Revenue rose 8 percent to nearly $2.4 million while loadings increased 4 percent and revenue ton-miles rose 5 percent.
'CN delivered a solid second quarter performance as a result of continued improvements in freight volumes and strong operational execution,' said Claude Mongeau, CN president and chief executive officer. 'CN railroaders responded quickly and effectively to a series of weather challenges, including floods, forest fires and mudslides.'
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Mongeau said all of CN’s commodity groups posted revenue gains during the quarter. Intermodal, CN’s largest revenue segment, was a bright spot, benefiting principally from higher import volumes through the ports of Vancouver and Prince Rupert and increased domestic retail shipments. Total intermodal volumes rose 10 percent and intermodal revenues increased 14 percent.
'Intermodal was one of the first areas where we applied our new end-to-end supply chain collaboration approach,' Mongeau said. 'This approach is really starting to pay off, and we hope to enjoy gains in other segments of our business where we have brought forward a similar focus on innovation and service excellence.'
'The company's 2Q11 operating ratio of 61.3 percent was roughly in line with the 61.2 percent operating ratio posted one year ago despite the very challenging operating conditions experienced in 2Q11,' an analyst for Stifel Nicolaus Transportation & Logistics Research Group, wrote in a note about CN Tuesday. 'Despite adverse operating conditions, most productivity metrics held up well in 2Q11, in our view; the company continues to demonstrate progress on its initiative to run longer/heavier trains.'