(The Canadian Press circulated the following article on January 3.)
VANCOUVER — Storms that swept across Western Canada in November and December dumping snow and causing mudslides have prompted an analyst to lower his 2006 profit estimates for Canadian Pacific Railway Ltd. and Canadian National Railway Co.
However, RBC Capital Markets analyst Walter Spracklin suggested the extreme weather will result in a shifting of volumes to the first quarter of 2007 as overall demand remains solid in most segments.
“High winds at the port of Vancouver have impeded the ability of terminal operators to load and unload intermodal containers, while heavy snow and mudslides have caused delays along the major rail corridors carrying bulk commodities,” Mr. Spracklin said in a report to clients.
“In addition, colder than normal temperatures from Manitoba through Western Canada also resulted in shorter train lengths, due to the impact that colder temperatures have on air-braking systems.”
Mr. Spracklin lowered his earnings per share estimate for the fourth quarter of 2006 for CNR to 88 cents, down from 94 cents. His estimate for Canadian Pacific went to $1.15, from $1.18.
Shares in CNR were up 71 cents at $50.94 on the Toronto Stock Exchange on Wednesday afternoon, while Canadian Pacific shares were up 39 cents at $62.57.