22 April 2008
CPR Cuts 2008 Earnings Outlook
| |
CPR 3-month TSX
chart.
|
Shares of Canadian Pacific Railway fell more than four percent
after the company reported a fall in first-quarter profits and cut its earnings outlook for the year.
CP stock slipped $3.03 to close $68.22 on the TSX.
The stock slide came after CPR said its first-quarter earnings fell 29 percent to $91 million, from $129 million a year
ago.
The company's profit fell to 59 cents per dilute share from 82 cents one year earlier.
The company's revenues gained three percent to hit $1.15 billion.
Freight revenues gained 10 percent, but the effects of the higher Canadian dollar weighed on overall revenues.
"The first quarter brought many challenges as we continued to face remarkable year-over-year increases in both fuel
prices and the Canadian dollar", said Fred Green, CPR's president and CEO. "At the same time, we had a difficult winter with
prolonged cold spells and record snowfall which affected the entire supply chain and resulted in very tough operating conditions
throughout the central and eastern parts of our network", Green said in a release. "Although our busy western corridor
remained fluid, the winter weather had a significant impact on our overall ability to move traffic efficiently".
In light of its first-quarter results, and the state of the economy, CPR reduced its 2008 full-year earnings
forecast to a range of $4.40 to $4.60 a share, down from its earlier prediction of $4.65 to $4.80 a share.
CPR's reduced forecast came one day after competitor Canadian National Railway issued its own weaker outlook.
|
