Claude Mongeau presided over impressive results yesterday for his first quarter at the helm of Canadian National Railway Co.
The Montreal-based railroad's profits jumped more than 20 per cent to $511 million for the three months ended March 31 from $424 million in the year-earlier period. Revenues also grew by six per cent to $1.97 billion from $1.86 billion in the quarter last year.
Carloads were up 16 per cent and revenue ton-miles increased 14 per cent, while CN's operating ratio dropped to 69.3 per cent from 71.7 per cent last year. This measures the cost of operating the railway, so the lower the better. Free-cash flow also surged to $493 million from $207 million in the quarter last year.
Mongeau, who took over as president and CEO of CN from Hunter Harrison on Jan. 1, said in a teleconference call that "it's clear the economy is in recovery mode, perhaps faster than we had anticipated."
"All the key metrics are going in the right direction."
Chief operating officer Keith Creel said that the company's performance was helped by clement weather, reducing the higher costs of operating in harsh winters.
"Mother Nature was good to us, but rest assured, we did not simply get by by riding Mother Nature's coattails ...
We fired 775 employees, 660 of them through attrition."
