Canadian National boosts profits despite dip in revenue
The Canadian National Railway Co. reported sharply higher fourth quarter and yearly profits of CAN $224 million ($176 million) and $1 billion due in large measure to fewer extraordinary expenses.
Operating income was $512 million for the quarter and $1.8 billion for 2003. Revenue of $1.5 billion offset high fuel and exchange rate costs, the railroad said. The strengthening of the Canadian dollar reduced U.S. revenues by $145 million and operating income by $45 million. Excluding the impact of the dollar conversion revenue would have increased 7 percent, Canadian National said.
The company said fourth quarter revenue, despite a 2 percent overall drop, was boosted by strong business in grain shipments, overseas container traffic at the ports of Vancouver and Halifax, higher lumber shipments and new iron traffic to China via the Port of Prince Rupert. Full year revenues declined 4 percent to $5.9 billion.
Net income during the 2002 same quarter was $22 million after the company took a $173 million charge to cover workplace injury and other claims. Adjusted for charges, net income was up 11 percent in the 2003 fourth quarter. Net income was $800 million for the full year in 2002.
Cost containment contributed to a record operating ratio of 66.1 percent. Operating expenses were cut 31 percent to $1 billion during the quarter.