Canadian National Railway Company · TSX:CNR
Canadian National Railway — Q3 2011 Earnings Presentation
19 slides from Canadian National Railway's earnings presentation, Oct 25, 2011
Slide 1: Third-Quarter 2011 Financial Results
Third- AuanEL 2011 Financial Seale October 25, 2011
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS The financial results in this presentation were determined on the basis of U.S. GAAP. Please refer to the website www.cn.ca/nonGAAP for the reconciliation of certain non-GAAP measures to comparable GAAP measures. To the extent we have provided guidance which are non-GAAP f
Slide 3: Claude Mongeau, President and Chief Executive Officer
Slide 4: Q3 2011 Highlights
Q3 2011 Highlights Record revenue performance "Up 12% at constant currency *Outpacing the economy Solid financial results « Operating ratio at 59.3% « Adjusted Diluted EPS up 16%”) = YTD Free Cash flow of C$1,328M" Delivering on our agenda () Please see website, www.cn.ca/nonGAAP. for an explanation
Slide 5: Keith Creel, Chief Operating Officer
Slide 6: Q3 Operating Highlights
CN Q3 Operating Highlights GTM's per train mile Cars per yard switching hour Terminal Dwell (entire railroad, hours) 39 7997 8159 37 37 7775 | 16.5 16.0 16.3 03-09 Q3-10 Q3-11 Q3-08 Q3-10 Q3-11 03-09 3-10 03-11 Trailing GTM’s per total Car miles per day Train Speed (mph) horsepower 284 281 276 217 2
Slide 7: Operational and Service Excellence
Operational and Service Excellence Completion of key infrastructure projects across our network Railroading hard in Q4 Already preparing for winter Supply-chain collaboration and service innovation
Slide 8: Jean-Jacques Ruest, Chief Marketing Officer
Slide 9: Q3 Revenues
Q3 Revenues % Change at As Reported onaee constant currency In millions of Canadian dollars, unless otherwise indicated 2011 2010 Tt fGctevoestigs Petroleum and chemicals $361 $341 6% 10% Metals and minerals 274 227 21% 26% Forest products 325 303 7% 12% Automotive 117 107 9% 15% Coal 166 164 1% 4%
Slide 10: Intermodal
CN Intermodal Third Quarter (2011 vs 2010) Revenues 1) eel 14% RTMs 8% Carloads [=m 7% ¢/RT™ ) 6% Revenue / car (1) TM Market Breakdown = Acore growth engine for CN = International segment — continues to outpace the market @ International = Domestic segment — good momentum across all segments Domest
Slide 11: Bulk
Bulk Third Quarter (2011 vs 2010) Revenues (1) Ll RTMs tl 1% Carloads (4%) [a ULL tat ¢/RTM el Revenue / car (1) See 1% Commodity Breakdown Canadian grain — more favourable to CN catchment area @ Coal and Pet Coke U.S. grain — weaker exports through the Gulf M4 Grain and Grain Products Offshore dema
Slide 12: Manufacturing
Manufacturing Third Quarter (2011 vs 2010) Revenues (1) 15% RTMs ——$ prelil Carloads Ns ¢/RTM 5% Revenue / car (1) uu is Commodity Breakdown = Volumes of crude oil and refined petroleum @ Petroleum, products ramping up Chemicals & Sulfur 4 Metals, Minerals « Strong shipments of steel driven by oil &
Slide 13: Luc Jobin, Executive Vice-President and Chief Financial Officer
Luc Jobin Executive Vice-President and Chief Financial Officer
Slide 14: Q3 Results
Q3 Results Change In millions of Canadian dollars, except EPS data, unless otherwise indicated 2044 2010 (unfavorable) Revenues $2,307 $2,122 9% Operating expenses 1,369 1,288 Operating income 938 834 12% Interest expense (85) (90) Other income 70 24 Income before income taxes 923 768 Income tax exp
Slide 15: Q3 Operating Expenses
Q3 Operating Expenses % % Change at As Reported Change constant currency In millions of Canadian dollars, unless otherwise indicated 2011 2010 Wicvoene) (iescenia) Labor and fringe benefits $396 $437 9% 7% Purchased services and material 271 246 (10%) (13%) Fuel 350 249 (41%) (49%) Depreciation and
Slide 16: YTD 2011 Free Cash Flow
YTD 2011 Free Cash Flow In millions of Canadian dollars, unless otherwise indicated Net income Non-cash adjustments Payments for income taxes Other working capital items Capital expenditures (net) Disposal of property Other investing “) Dividends Effect of foreign exchange fluctuations on US dollar-
Slide 17: Uncertain economic environment
Uncertain economic environment *Current volume growth steady «Monitoring trends carefully Reaffirming 2011 guidance Expecting up to 15% growth over 2010 adjusted diluted EPS “ =Free cash flow in the order of $1.2B (2) Leveraging solid pipeline of a and growth initiatives into next ye «Facing pension
Slide 18: Claude Mongeau, President and Chief Executive Officer
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