(Reuters distributed the following article on July 29.)
CALGARY — Higher freight volumes allowed Canadian Pacific Railway Ltd. to more than double its second-quarter profit and to forecast higher revenues for the rest of the year.
CP said yesterday it has largely resolved problems that dogged its West Coast operations this year, but that it has yet to decide what capital investments will be necessary to handle future surges in the region’s rail traffic.
“We’re moving what is offered, and positioned to handle reasonable growth,” chief executive Rob Ritchie told analysts.
The carrier, which operates nearly 22,000 kilometres of track in Canada and the United States, said it earned $83.7 million, or 53 cents a share, in the quarter, compared with a profit of $34.1 million, or 22 cents a share, in the year-before period.
Revenues were just over $1 billion, up from $914 million a year earlier. CP Rail said it expects freight volumes to remain robust for the rest of 2004, with revenue growth of between 5 and 7 per cent.
CP’s operations suffered in early 2004 when its mainline through the Rocky Mountains was hit with several weather closings and it struggled with an unexpected sharp jump in traffic at the Port of Vancouver.
CP is talking with customers to see if it will need expand its track network and plans a decision by the end of the year.
Ritchie said its current shipping delays were due largely to the slow return of freight cars, such as lumber-carrying flat cars, from U.S. rail carriers, which have also seen their capacity stretched by increased shipping volumes.