MONTREAL — Canadian National Railway Co. saw its profits plunge last quarter with a week-long strike and thinner freight demand denting revenues.
The country’s largest railway says net income dropped 24 per cent to $873 million in the quarter ended Dec. 31, compared with $1.14 billion in the same period in 2018.
Fourth-quarter revenue fell six per cent to $3.58 billion versus $3.81 billion the year before, CN said Tuesday.
On an adjusted basis, diluted earnings decreased to $1.25 per share, 16 per cent lower than $1.49 per share 12 months prior.
The result notched above analyst expectations of $1.20 per share — which came following a revised forecast from CN in December — according to financial markets data firm Refinitiv.
Full-year revenues rose four per cent to $14.92 billion and profits dipped three per cent to $4.22 billion.
The board of directors approved a seven per cent increase in the 2020 dividend on the Montreal-based company’s common shares.
The eight-day strike by 3,200 conductors and yard workers last November — the longest rail strike since 2012 — brought the railway to a near halt, stopping shipments, triggering layoffs and disrupting industries across the country.
Keith Reardon, who oversees the company’s consumer product supply chain, said the strike “impacted our domestic business for close to a month.”
Chief executive JJ Ruest said CN will scale down its capital program but aims to invest $3 billion in capital expenditures this year versus a total of $7.4 billion over the past two years.
“CN’s strong balance sheet provides us with the financial flexibility and resiliency required in the current turbulent economic environment,” Ruest said in a statement.
“We’ll have to do quite a bit of self-help,” he added, on a conference call with investors.
This report by The Canadian Press was first published Jan. 28, 2020.
Companies in this story: (TSX:CNR)
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