CALGARY, March 7, 2018 /PRNewswire/ - Canadian Pacific
Railway Limited (TSX: CP) (NYSE: CP) continues to deliver overall
for the grain supply chain with our year-to-date shipments, through
Week 31, up 3 percent, or approximately 400,000 metric tonnes.
While extreme weather took its toll on the entire supply chain
through much of February, CP's network is now starting to recover.
Week 31 saw grain shipments increase by 16 percent week-over-week
and each day CP's network is getting more fluid. CP also spotted
nearly 50 percent more empties to the country in Week 31 compared
to the week prior, a further sign of the incremental gains being
made. CP's velocity is also improving, with train speeds up
approximately 10 percent this past week versus mid-February.
"We are optimistic that with the weather turning in our favour,
our singular focus on delivering safely for the supply chain, and
the re-opening of the Port of Thunder
Bay, that we are on the road to recovery," said Keith Creel, CP President and CEO. "While our
challenges have been significant, they are different than that of
our competitor's and the success of the supply chain depends on
both railroads running at optimum levels."
The supply chain works best when all of the players are
functioning at a high level. When one railroad struggles, or a
shipper is dealing with a labour outage, or a vessel captain
refuses to load in Vancouver due
to rain – the entire supply chain suffers, just as it does when
temperatures drop below -25 Celsius for long periods of time.
Extreme weather and line outages impact all commodity movements,
not just grain.
Each year, CP plans extensively for winter. Recently we have
experienced unprecedented cold (60 percent colder, 78 percent more
days below -25 Celsius) and snow along with some significant
outages. Additionally, CP is experiencing unprecedented and
unexpected demand being driven from dual rail-served territories in
the northern catchment areas of our network. In spite of
significant weather challenges our shipments are up 30 percent
crop-year to date in this area.
CP strategically plans each year for the upcoming crop, which
this year was originally forecast around 65 million metric tonnes,
but will end up being closer to 71 million metric tonnes, close to
a 10 percent difference, with much of that increased production
occurring in the northern catchment area of the prairies due to dry
conditions in the south.
"These short-term challenges are episodic, not systemic and we
expect our network to improve with improving weather conditions,"
Creel said. "We are still moving more grain than we did last year
and we are well positioned to have a great year overall across most
commodities and lines of business."
CP's innovative Dedicated Train Program (DTP) has 15 percent
more subscribers this year, DTP cycle times were on target and
generally, things along CP's network were moving well, prior to
February. CP's year-over-year compares would be even better if not
for a very slow start to the crop-year for grain sales. A
portion of CP's dedicated train capacity also sat idle for most of
August and September, and some shippers struggled to fill their
committed freight until November.
CP continues to add both crews and locomotives to support
volumes across all commodities and urges the senate and government
to move forward on Bill C-49 to bring some further certainty to the
grain supply chain moving forward, specifically relating to new
hopper car investment.
"We have 550 new people, across all crafts, in various stages of
the hiring process, 100 additional locomotives, which will start
being integrated into the fleet this month and into the spring and
summer, and we have earmarked between $1.35
billion and $1.5 billion in
capital improvements this year that will further improve the flow
of goods across North America,"
Creel said.
Forward Looking Statements
This news release contains
certain forward-looking information within the meaning of
applicable securities laws relating, but not limited, to crop
production estimates, transportation volume expectations,
legislative changes and capital investments. This forward-looking
information includes, but is not limited to, statements concerning
expectations, beliefs, plans, goals, objectives, assumptions and
statements about possible future events, conditions, and results of
operations or performance. Forward-looking information may contain
statements with words or headings such as "financial expectations",
"key assumptions", "anticipate", "believe", "expect", "plan",
"will", "outlook", "should" or similar words suggesting future
outcomes.
Undue reliance should not be placed on forward-looking
information as actual results may differ materially from the
forward-looking information. Forward-looking information is not a
guarantee of future performance. By its nature, CP's
forward-looking information involves numerous assumptions, inherent
risks and uncertainties that could cause actual results to differ
materially from the forward-looking information, including but not
limited to the following factors: changes in business strategies;
general North American and global economic, credit and business
conditions; risks in agricultural production such as weather
conditions and insect populations; the availability and price of
energy commodities; the effects of competition and pricing
pressures; industry capacity; shifts in market demand; changes in
commodity prices; uncertainty surrounding timing and volumes of
commodities being shipped via CP; inflation; changes in laws and
regulations, including regulation of rates; changes in taxes and
tax rates; potential increases in maintenance and operating costs;
uncertainties of investigations, proceedings or other types of
claims and litigation; labour disputes; risks and liabilities
arising from derailments; transportation of dangerous goods;
timing of completion of capital and maintenance projects; currency
and interest rate fluctuations; effects of changes in market
conditions and discount rates on the financial position of pension
plans and investments; and various events that could disrupt
operations, including severe weather, droughts, floods, avalanches
and earthquakes as well as security threats and governmental
response to them, and technological changes. The foregoing list of
factors is not exhaustive.
These and other factors are detailed from time to time in
reports filed by CP with securities regulators in Canada and the
United States. Reference should be made to "Risk Factors"
and "Management's Discussion and Analysis of Financial Condition
and Results of Operations – Forward-Looking Information" in CP's
annual and interim reports on Form 10-K and 10-Q. Readers are
cautioned not to place undue reliance on forward-looking
information. Forward looking information is based on current
expectations, estimates and projections and it is possible that
predictions, forecasts, projections, and other forms of
forward-looking information will not be achieved by CP. Except as
required by law, CP undertakes no obligation to update publicly or
otherwise revise any forward-looking information, whether as a
result of new information, future events or otherwise.
About Canadian Pacific
Canadian Pacific is a
transcontinental railway in Canada
and the United States with direct
links to major ports on the west and east coasts, providing North
American customers a competitive rail service with access to key
markets in every corner of the globe. CP is growing with its
customers, offering a suite of freight transportation services,
logistics solutions and supply chain expertise. Visit cpr.ca to see
the rail advantages of CP. CP-IR
SOURCE Canadian Pacific