Canadian National 2010 profit up 13pc to US$2.1 billion

STATE-OWNED Canadian National Railway (CN) has posted a 2010 net profit increase of 13 per cent year on year to C$2.1 billion (US$2.11 billion) drawn on a 12 per cent increase in revenue to C$8.2 billion.

"CN's strong fourth-quarter performance capped an impressive year. Operational and service excellence throughout 2010 allowed us to post solid operating metrics while handling a sharp rise in workload with improved reliability for our customers," said CN president and CEO Claude Mongeau.

The adjusted 2010 net income was C$1.97 billion, compared with 2009 adjusted net income of C$1.53 billion.

Net income for the final quarter of 2010 was C$503 million, down from C$582 million in the fourth quarter of 2009, as revenues increased 12 per cent to C$2.11billion on strong volume growth.

Fourth-quarter carloadings and revenue tonne-miles grew by more than 10 per cent, while full-year carloadings were up 18 per cent over 2009 and revenue tonne-miles increased by 12 per cent.

Although CN reports its earnings in Canadian dollars, a large portion of its revenues and expenses are denominated in US dollars. As such, the company's results are affected by exchange-rate fluctuations.

In support of top-line growth for 2011, CN expects to take advantage of continued strong growth in overseas container traffic, metal products and iron ore in domestics markets, and wood pulp and lumber offshore.

Other growth opportunities include Canadian metallurgical coal and US thermal coal, increased shipments of petroleum and chemicals, and share gains against truck in domestic intermodal market.