Canadian Pacific Railway reports better-than-expected 4Q revenue but net income plunges

Canadian Pacific Railway (TSE:CP) (NYSE:CP) reported fourth quarter results late Wednesday that beat analyst expectations as the railway moved higher volumes of energy, grain and commodities. 

CP Rail’s adjusted income came in at C$648 million, or C$4.55 per share, in the fourth quarter ending Dec. 31, up from C$469 million, or C$3.22 per share, in the fourth quarter of 2017. This beat analysts’ average estimates of C$4.22, according to IBES data from Refinitiv.

Net income plunged 45% to C$545 million in the fourth quarter of 2018 compared to the same period in 2017. 

The Calgary-based railway’s revenue rose 17% to C$1.96 billion in the fourth quarter.

“CP’s impressive fourth quarter operating results are a testament to the hard work and dedication of our 13,000-strong CP family — who continue to safely and efficiently deliver for our customers and the North American economy,” said Keith Creel, Canadian Pacific president and chief executive officer. “The power of the CP operating model is evident in the strong performance across the company. We set records across many lines of business in 2018, including Canadian grain, potash and domestic intermodal.”

Fourth quarter revenues for energy, chemicals and plastics jumped 49% to $369 million, on the back of growing demand from Asian markets.

The company recorded an income-tax gain of C$527 million, which was related to the U.S. tax overhaul in the fourth quarter of 2017. 

Contact Katie Lewis at [email protected]
Follow her on Twitter: @kelewis

Story by ProactiveInvestors