Canadian National Railway Company · TSX:CNR
Canadian National Railway — Shareholder Meeting (2015)
53 slides from Canadian National Railway's shareholder meeting presentation, 2015
Slide 1: Building for the Future
BUILDING FOR THE FUTURE per
Slide 2: Robert Pace, Chairman of the Board
Robert Pace CHAIRMAN OF THE BOARD
Slide 3: Building for the Future
BUILDING FOR THE FUTURE per
Slide 4: Safety Briefing
Safety Briefing
Slide 5: All Aboard Safety
all aboard safety
Slide 6: Jim Larmer and Kevin Timmerman
Jim Larmer SEPTEMBER 10, 2014 Kevin Timmerman APRIL 10, 2015
Slide 7: Building for the Future
BUILDING FOR THE FUTURE per
Slide 8: Notice of Meeting
Notice of Meeting
Slide 9: Scrutineers
Scrutineers
Slide 10: Report on Quorum
Report on Quorum oF | i. :
Slide 11: Consolidated Financial Statements
Consolidated Financial Statements
Slide 12: Election of Directors
Election of Directors
Slide 13: Director Nominees
Director Nominees Donald Carty Ambassador Gordon Giffin Edith Holiday Maureen Kempston Darkes The Honourable Denis Losier The Honourable Kevin Lynch Claude Mongeau James O’Connor Robert Pace Robert Phillips Laura Stein
Slide 14: Appointment of Auditors
Appointment of Auditors
Slide 15: Advisory Vote on Executive Compensation
Advisory Vote on Executive Compensation
Slide 16: Building for the Future
BUILDING FOR THE FUTURE per
Slide 17: Claude Mongeau, President and CEO
Claude Mongeau PRESIDENT AND CEO
Slide 18: Slide 18
Slide 19: Acquisitions, diversified business, reaching major markets
• C$8 billion of acquisitions • Diversified book of business • Reaching major markets in Canada and the U.S.
Slide 20: A True Backbone of the Economy
A True Backbone of the Economy ia ie i a %
Slide 21: What We Stand For
CREATING VALUE FOR SHAREHOLDERS DELIVERING SAFELY & RESPONSIBLY DELIVERING OPERATIONAL ee’ ANDSERVICE * EXCELLENCE BUILDING FOR THE FUTURE CREATING VALUE FOR CUSTOMERS PLAYING OUR ROLE AS A BACKBONE
Slide 22: Building for the Future
BUILDING FOR THE FUTURE per
Slide 23: Forward-looking statements
The financial results in this presentation were determined on the basis of U.S. GAAP. Please CN also now assumes that in 2015 the value of the Canadian dollar in U.S. currency will be refer to the website www.cn.ca/nonGAAP for the reconciliation of certain non-GAAP approximately $0.80, compared with
Slide 24: Luc Jobin, EVP & Chief Financial Officer
Luc Jobin EXECUTIVE VICE-PRESIDENT & CHIEF FINANCIAL OFFICER
Slide 25: Non-GAAP measures
This presentation contains non-GAAP measures that do not have a standardized meaning prescribed by GAAP and are therefore not necessarily comparable to similar measures presented by other companies, and as such, should not be considered in isolation. A reconciliation to the comparable GAAP measures
Slide 26: Diluted and Adjusted Diluted Earnings per Share
Diluted Earnings per Share Adjusted Diluted Earnings per Share ($ Cdn) ($ Cdn) 3.85 3.76 3.06 3.09 3.06 2.70 2.81 2.24 25% 2.41 2.10 23% 14% CAGR 16% CAGR 2010 2011 2012 2013 2014 2010 2011 2012 2013 2014 Adjusted to exclude items affecting the comparability of results. See website for an explanatio
Slide 27: Carloads and Revenues
Carloads Revenues (thousands) ($M Cdn) 12,134 5,625 4,696 4,873 5,059 5,190 9,920 10,575 9,028 8,297 8% 15% 5% CAGR 10% CAGR 2010 2011 2012 2013 2014 2010 2011 2012 2013 2014 Revenues up 10% on a constant currency basis(1) (1) See website for an explanation of this non-GAAP measure
Slide 28: Expenses and 2014 Operating Ratio
Expenses 2014 Operating Ratio ($M Cdn) (percent) 7,510 6,702 67.0 6,235 5,732 5,273 12 % 64.7 61.9 2010 2011 2012 2013 2014 US Peers CP CN On a constant currency basis, expenses up 8%(1) (1) See website for an explanation of this non-GAAP measure. CP and US Peers (weighted average of UP, CSX and NS)
Slide 29: Train Productivity, Yard Productivity, Car Velocity
Train Productivity Yard Productivity Car Velocity (GTMs per train mile) (Cars per yard switching hour) (Car miles per day) 205 199 8,625 45 8,438 42 2013 2014 2013 2014 2013 2014
Slide 30: Becoming a true supply chain enabler
• Becoming a true supply chain enabler − Improving first mile/last mile service, engaging and collaborating with an outside-in perspective • End-to-end visibility − Rolling out iAdvise, a key information tool linking the customer, CN customer service representative and CN operations • Customer centr
Slide 31: Free Cash Flow
Free Cash Flow* ($M Cdn) 2,220 1,618 1,746 1,661 1,623 2,047 1,450 1,377 1,350 1,571 30% 2010 2011 2012 2013 2014 Adjusted Free Cash Flow (excluding Major Asset Sales) Major Non-Strategic Asset Sales * Free cash flow after voluntary pension plan contributions of C$100 million, C$700 million, C$350 m
Slide 32: Capital Investments 2010-2014
Capital Investments 2010-2014 ($B Cdn) Core Track and Roadway 5.1 Growth, Capacity and Productivity 1.7 Rolling Stock 1.5 $2.3B invested Information Technology in 2014 and Other 1.3 Unwavering focus on safety and plant integrity Supporting growth, service and productivity
Slide 33: Adjusted Debt-to-Capitalization and Debt to EBITDA
Adjusted Debt-to-Total Adjusted Debt to Capitalization Ratio Adjusted EBITDA (at December 31) (for the twelve months ended December 31) 1.72x 1.58x 39.4% 40.1% 2013 2014 2013 2014 See website for an explanation of these non-GAAP measures.
Slide 34: Share Buyback and Dividends
Share Buyback Dividends ($M Cdn) ($M Cdn) 818 1,420 1,505 724 1,400 1,400 652 585 913 503 2010 2011 2012 2013 2014 2010 2011 2012 2013 2014 19 consecutive years of 22.4M shares repurchased in 2014 dividend growth (17% CAGR) Current program of up to 28M shares 25 % increase approved for 2015
Slide 35: Five-year cumulative total return
350 Index: Closing price on December 31, 2009 = 100 Assumes reinvestment of all dividends CNR 300 200%* CNI 250 174%* S&P 500 200 44%* S&P TSX 150 105%* 100 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 * Cumulative total return over the last five years
Slide 36: Q1 Diluted and Adjusted Diluted EPS
Diluted Earnings Adjusted Diluted Per Share Earnings Per Share ($ Cdn) ($ Cdn) 15% 0.86 0.86 0.75 30% 0.66 Q1-14 Q1-15 Q1-14 Q1-15 Adjusted to exclude items affecting the comparability of results. See website for an explanation of this non-GAAP measure.
Slide 37: 2015 outlook
• Double-digit earnings growth over 2014 adjusted diluted EPS of C$3.76 (1) • Reinvesting C$2.7B in the business for safety, growth and productivity • Rewarding shareholders through continued dividend growth and share buybacks (1) Please see website, www.cn.ca/nonGAAP, for an explanation of this non
Slide 38: Building for the Future
BUILDING FOR THE FUTURE per
Slide 39: Introduction of Directors
Introduction of Directors
Slide 40: Director Donald Carty
Director Donald Carty
Slide 41: Director Ambassador Gordon Giffin
Director Ambassador Gordon Giffin
Slide 42: Director Edith Holiday
Director Edith Holiday
Slide 43: Director Maureen Kempston Darkes
Director Maureen Kempston Darkes
Slide 44: Director The Honourable Denis Losier
Director The Honourable Denis Losier
Slide 45: Director The Honourable Kevin Lynch
Director The Honourable Kevin Lynch
Slide 46: Director James O'Connor
Director James O’Connor
Slide 47: Director Robert Phillips
Director Robert Phillips
Slide 48: Director Laura Stein
Director Laura Stein
Slide 49: Director Claude Mongeau
Director Claude Mongeau
Slide 50: Director Robert Pace
Director Robert Pace
Slide 51: Building for the Future
BUILDING FOR THE FUTURE per
Slide 52: Question Period
Question Period
Slide 53: Building for the Future
BUILDING FOR THE FUTURE per
Canadian National Railway Company — Shareholder Meeting (2015) on 6ix