22 March 2011

CP Railway Shares Fall After Warning

Calgary Alberta - Shares of Calgary-based Canadian Pacific fell Tuesday, a day after it warned its first-quarter earnings will be lower than a year ago due to the severity and length of winter this year.
 
Stock in Canada's second-largest railway closed down $1.78, or 2.8 percent, at $62.71 on the Toronto Stock Exchange.
 
The bad weather has forced the company to slow trains and avalanches have also disrupted traffic.
 
"Since the new year, multiple severe weather events have caused significant disruptions to train operations across our network," CEO Fred Green said in a statement.
 
"The impact of avalanche disruptions are just one factor that increased fivefold this year in our busiest corridor through the mountains causing very inefficient stop-start operations."
 
CP said it expects to earn between 12 and 22 cents per diluted share for the quarter, down by about 40 cents from last year.
 
The average analyst estimate according to Thomson Reuters had been for a profit of 71 cents per share.