8 September 2008
CP Rail in Good Financial Shape Despite Management Changes
The appointment of Kathryn McQuade as the new CFO of Canadian
Pacific Railway Ltd. may have come as a surprise to some, but the former COO is in fact a better fit than Mike Lambert who left
"to pursue other interests", according to RBC Capital Markets' Walter Spracklin. That's because putting a senior manager with
operational experience is the right move given CEO Fred Green's growth plans, the analyst told clients.
In terms of Ms. McQuade's suitability for the job, Mr. Spracklin has no concerns given her 20 years of finance experience in roles that
included senior vice president of finance and executive vice president of planning and CIO at Norfolk Southern Corp.
And as far as what the management realignment means for CP as a whole, the analyst does not see this as a sign of bad news ahead.
"While the company's financial performance has underperformed our expectations, we see no link between this announcement and the
company's financial performance," Mr. Spracklin said, adding that he considers CP's financial situation to be strong and its debt
"solidly" two notches above investment grade at all three rating agencies.
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