Canadian Pacific Railway Ltd. (CSE:CN) today reported strong quarterly revenue growth of 7% in its second quarter.
The company said service interruptions related to labour negotiations and strike notices caused its net income to decrease 10% in the second quarter despite higher revenues.
The Calgary-based railway earned C$436 million, compared with C$480 million a year earlier.
That translated into C$3.04 per share for the period ended June 30, down from C$3.27 per share in the second quarter of 2017.
"Overall, it was a good quarter that sets the franchise up well for the remainder of 2018 and beyond," said Keith Creel, CP president and chief executive officer.
"Our quarterly performance was impacted by service interruptions related to labour negotiations and strike notices. However, we were able to reach tentative long-term agreements with both the Teamsters Canada Rail Conference and the International Brotherhood of Electrical Workers which will serve the CP family, customers, shareholders and the North American economy well for years to come. It is an exciting time to be at CP as we are well positioned for a strong second half of the year," Creel said.
"With labour stability in place, strong underlying network performance and a robust demand environment, the path is clear and the opportunities are many.
Excluding one-time items, adjusted earnings rose to C$453 million or C$3.16 per share, from C$407 million or C$2.77 per share year-over-year.
CP Rail's operating ratio, which measures its efficiency, worsened and rose to 64.2% from 62.8%.
CP Rail says its revenue ton-miles increased 4% and its carloads 2%.
Shares of CP Rail closed up 3.36% at C$248.83 in Toronto.