Canadian National Railway Company · TSX:CNR
Canadian National Railway — Q1 2017 Earnings Presentation
16 slides from Canadian National Railway's earnings presentation, Apr 24, 2017
Slide 1: First Quarter 2017 Financial Results
First Quarter 2017 Financial Results April 24, 2017
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements included in this presentation constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and under Canadian securities laws. By their nature, forward-looking statements involve risks,
Slide 3: Luc Jobin
Luc Jobin President and Chief Executive Officer
Slide 4: Highlights
Highlights Strong start to the year Driving top line growth − Record first quarter volumes and revenues with strong growth across most sectors (RTMs up 14%) − Market share gains in key service sensitive markets − Inflation-plus pricing At low incremental cost − Solid response from the operating team
Slide 5: Mike Cory
Mike Cory Executive VP and Chief Operating Officer
Slide 6: Operating Highlights
Operating Highlights Solid operating metrics despite 12% increase in GTMs and more demanding winter conditions Train Productivity Yard Productivity Terminal Dwell (GTMs per train mile) (Cars per yard switching hour) (Entire railroad, hours) 51 9,389 16.9 9,134 48 15.6 8,464 11% 44 16% 14.4 8% vs Q1-
Slide 7: JJ Ruest
JJ Ruest Executive VP and Chief Marketing Officer
Slide 8: Q1 Top Line Performance
Q1 Top Line Performance Impressive performance, particularly in coal, grain and frac sand Highlights Volumes % of Total % Change – Favorable Revenues (2) (Unfavorable) Bulk 12% Revenues 8% Grain & Fertilizers 24% 19% (8%) Coal 60% 4% Carloads 9% Merchandise $ / Carload (1%) 3% Petroleum & Chemicals
Slide 9: Market Outlook
Market Outlook Now expecting 2017 RTM growth of approximately 10% Intermodal Merchandise Bulk 23% of revenues 50% of revenues 23% of revenues • International • Positive outlook on energy-related • Shift to commercial framework and − Volumes expected to outperform volumes for Q2 best in class railroa
Slide 10: Ghislain Houle
Ghislain Houle Executive VP and Chief Financial Officer
Slide 11: Q1 Results
Q1 Results Solid financial performance Change Favorable In millions of Canadian dollars, except EPS data, unless otherwise indicated 2017 2016 (Unfavorable) Revenues $ 3,206 $ 2,964 8% Operating expenses 1,903 1,747 Operating income 1,303 1,217 7% Interest expense (122) (123) Other income 2 5 Income
Slide 12: Q1 Operating Expenses
Q1 Operating Expenses Continuing to deliver efficiency gains through disciplined cost management % Change at % constant Change currency (1) Favorable Favorable In millions of Canadian dollars, unless otherwise indicated 2017 2016 (Unfavorable) (Unfavorable) Labor and fringe benefits $ 580 $ 590 2% -
Slide 13: Generating Strong Free Cash Flow
Generating Strong Free Cash Flow In millions of Canadian dollars, unless otherwise indicated 2017 YTD Net income $ 884 Non-cash adjustments 468 Payments for income taxes (164) Other working capital items 68 Net cash provided by operating activities 1,256 Capital expenditures (net) (396) Other invest
Slide 14: Revised 2017 Financial Outlook
Revised 2017 Financial Outlook Expect to deliver adjusted diluted EPS in the range of C$4.95 to C$5.10 versus 2016 adjusted diluted EPS of C$4.59 (1) (2) − Volume growth of approximately 10% in terms of RTMs, with overall pricing above inflation Increasing our capital envelope by C$100M to C$2.6B fo
Slide 15: Luc Jobin
Luc Jobin President and Chief Executive Officer
Slide 16: Looking Ahead
Looking Ahead Creating value for our customers and shareholders - Building on the momentum of strong first quarter volumes - Solid foundation of operational excellence with unwavering commitment to safety - Leveraging our supply chain focus to grow faster than the economy - Capex program with a long
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