Canadian Pacific Kansas City Reverses Revenue Decline in Second Quarter
The railroad reported revenue of $4.2 billion, a 13% increase from the same period last year.
Canadian Pacific Kansas City (CP) reported a return to growth in its second quarter, reversing a revenue decline seen at the start of the year.
The results marked a trajectory inflection for the transportation company. Revenue rose 13% year-over-year to $4.2 billion from $3.7 billion in the prior-year period, following a 2% year-over-year decrease reported in the first quarter.
Core adjusted diluted earnings per share increased 13% year-over-year to $1.27, up from $1.12 in the second quarter of 2024. This followed a 2% year-over-year decrease to $1.04 in the first quarter. Reported diluted EPS decreased 14% year-over-year to $1.15 from $1.33.
Growth was supported by a 4% year-over-year increase in volumes, measured by revenue ton-miles, which accelerated from a 2% increase in the first quarter. The freight revenue mix showed growth in grain, which reached $925 million compared to $743 million a year earlier, and automotive, which rose to $403 million from $330 million. Coal revenues declined to $209 million from $256 million.
Efficiency metrics trended lower as the reported operating ratio increased 90 basis points year-over-year to 64.6%. The core adjusted operating ratio also rose 90 basis points to 61.6% from 60.7% in the prior-year period.
Canadian Pacific Kansas City is poised for accelerated growth and expects to accelerate volume and earnings growth in the second half of 2024.
On March 27, 2024, the company expanded its commercial paper program, increasing the maximum borrowing limit from $1.5 billion to $2.2 billion.