Canadian Pacific Kansas City Limited · TSX:CP
Canadian Pacific Kansas City — Canadian Pacific — Q1 2018 Earnings Presentation
15 slides from Canadian Pacific Kansas City's earnings presentation, Apr 18, 2018
Slide 1: Q1 2018 Earnings Review
Se Qi 2018 EARNINGS REVIEW APRIL 18, 2018 cP
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS The following investor presentation contains certain forward-looking market demand; inflation; changes in laws and regulations, including information within the meaning of applicable securities laws relating, but regulation of rates; changes in taxes and tax rates; potenti
Slide 3: Note on Non-GAAP Measures and Restated Financials
NOTE ON NON-GAAP MEASURES Except where noted, all figures are in millions of Canadian dollars. It should be noted that CP’s non-GAAP earnings as described in this presentation, have no standardized meanings and are not defined by Financial information is prepared in accordance with accounting U.S. G
Slide 4: Keith Creel, President & Chief Executive Officer
KEITH CREEL PRESIDENT & CHIEF EXECUTIVE OFFICER
Slide 5: Highlights
HIGHLIGHTS Q1 2018 VS. Q1 2017 Challenging winter conditions, but Revenues operating model was resilient and $1.66 billion team executed well +4% Operating Ratio Railroad recovering with strong 67.5% + 510 bps vs. reported OR momentum exiting Q1 +190 vs. adjusted OR (1) Diluted EPS Maintaining
Slide 6: John Brooks, Chief Marketing Officer
JOHN BROOKS CHIEF MARKETING OFFICER cP
Slide 7: Revenue Performance
REVENUE PERFORMANCE TOTAL REVENUE FX-adjusted revenue variance(1) +4% VS Q1 2017 Grain Coal Potash -7% 3% 18% Fertilizers & sulphur 5% Forest products 2% • RTMs: +6% Energy, chemicals & plastics 17% • Freight revenue per RTM: -2% -71% Metals, minerals, consumer 12% • FX: -2% • Fuel: +2% Automotive -
Slide 8: Nadeem Velani
NADEEM VELANI
Slide 9: Financial Performance
FINANCIAL PERFORMANCE (In millions, except percentages and First Quarter FX adjusted per share data) 2018 2017 Change % Change %(3) Total revenues $ 1,662 $ 1,603 4% 6% Compensation and benefits 374 300 25 % 27 % Fuel 215 170 26 % 31 % Materials 55 49 12 % 15 % Equipment rents 33 36 (8%) (6%) Deprec
Slide 10: Free Cash
FREE CASH For the three months ended March 31 (in millions) 2018 2017 Cash provided by operating activities $397 $311 Capital expenditures (241) (230) Other property and asset sales 4 3 Other (1) 5 Cash used in investing activities (238) (222) Effect of FX on USD-denominated cash & cash equivalents
Slide 11: 2018 Outlook
* Versus 2017 adjusted diluted EPS of $11.39. For a full description of 2018 Outlook and Non-GAAP measures, see CP’s 2017 Form 10-K on investor.cpr.ca
Slide 12: Appendix
APPENDIX
Slide 13: Pension Accounting Restatement
PENSION ACCOUNTING RESTATEMENT Beginning January 1, 2018, CP adopted the new accounting standard for the presentation of net periodic pension costs and post-retirement benefit costs. The new accounting standard resulted in a 430 bps increase to CP’s Q1 2017 operating ratio. There were no changes
Slide 14: Key Modeling Sensitivities
KEY MODELING SENSITIVITIES Key sensitivities Foreign exchange rate* For every $0.01 decline in the Canadian dollar: • Revenues increase by approximately $27 million • Expenses increase by approximately $14 million • Interest expense increases by approximately $3 million *Sensitivities are quoted on
Slide 15: Investor Relations Contacts
MAEGHAN ALBISTON ASSISTANT VICE PRESIDENT INVESTOR RELATIONS ANDREW ELFORD DIRECTOR INVESTOR RELATIONS 403-319-3591 investor@cpr.ca investor.cpr.ca cp