MINNEAPOLIS—Canadian National Railway Co. said on Monday its second-quarter profit fell 11 percent as the company struggled with rising fuel costs, but it still came in ahead of analyst expectations.
The railroad left intact its guidance for full-year profit growth in the mid single-digits, despite fuel costs that rose 60 percent from a year ago. It said the guidance was based on oil prices of $135 per barrel.
For the quarter that ended June 30, Canadian National said it earned $459 million Canadian ($456.6 million U.S.) or 95 cents Canadian (94 cents) per share, down from $516 million Canadian ($513.3 million), or $1.01 per share Canadian ($1), during the same period last year.
Revenue rose 3.5 percent to almost $2.1 billion Canadian (2.09 billion), up from $2.03 billion Canadian ($2.02 billion) a year ago.
Analysts surveyed by Thomson Financial were expecting, on average, per-share earnings of 86.5 cents Canadian (86 cents).
Canadian National attributed revenue gain to higher prices, including a higher fuel surcharge, and increased volume in commodities such as metals and minerals, which saw revenue increase 6 percent. Revenue for its intermodal category rose 14 percent, and coal-hauling revenue rose 8 percent.
Results were hurt by the strong Canadian dollar versus the U.S. dollar, which hurt results by $25 million Canadian, or about a nickel per share Canadian. Results were also hurt by weak markets such as forest products (revenue down 14 percent) and automotive (down 13 percent).
