Calgary Alberta - As part of its 2018 Investor Day, Canadian Pacific Railway Limited (CP) today reported preliminary third-quarter results, updated its 2018 guidance, and unveiled the next phase of its long-term strategy, focused on driving sustainable, profitable, growth.
 
CP reports preliminary third-quarter results

• Revenues are estimated to grow by 19 percent to an all-time record high of approximately $1.9 billion;
   
  
• Operating ratio is expected to be sub 58.5 percent;
   
  
• Reported diluted earnings per share (EPS) is expected to be approximately $4.35 and adjusted diluted EPS is expected to be approximately $4.10, the highest in the Company's history.

CP raises full-year guidance
 
Due to a record-setting third quarter and a strong outlook for the remainder of the year, CP is also raising its 2018 full-year guidance.
 
The Company now expects adjusted diluted EPS to grow in excess of 20 percent, increased from earlier guidance of low-double digit growth. [1]
 
CP outlines strategy for sustainable, profitable growth at 2018 Investor Day
 
At Investor Day, hosted at CP's Ogden campus in Calgary, President and Chief Executive Officer Keith Creel will outline for investors the Company's multi-year strategy to deliver superior service and financial results.
 
"Simply put, we have rebuilt the engine at CP and are leveraging the strengths of our franchise to drive growth," Creel said.
 
"Our continued success comes from our commitment to the precision scheduled railroading model, our deep bench of industry-leading railroaders, a disciplined approach to capital investment, network capacity, and a focus on sustainable growth."
 
Financial targets for 2018-2020:

• Volume compound annual growth rate (CAGR) of mid-single digits, measured in Revenue Ton-Miles (RTMs);
   
  
• Double-digit CAGR in adjusted diluted EPS;
   
  
• Continued margin improvement through cost control and operating leverage;
   
  
• Capital expenditures of approximately $1.6 billion per year.

Mr. Creel said CP's growth strategy is built on its foundations, people, and network strengths.
 
"Our family of nearly 13,000 CP railroaders is proud to safely and efficiently deliver for our customers, communities, and the broader supply chain. We remain committed to the foundations of precision scheduled railroading, across all aspects of the Company, and with the rigor the model demands for long-term success."
 
Key Assumptions for 2018-2020 Targets:

• Exchange rate of 1.30 CAD/USD;
   
  
• On-Highway Diesel price of $3.20 USD/US gallon;
   
  
• Pension income consistent with 2018;
   
  
• Annualized effective tax rate of approximately 25 percent, excluding discrete items such as foreign-exchange gains or losses on U.S. dollar-denominated debt and any effects of changes in tax rates.

For information regarding non-GAAP measures, including reconciliations to the nearest GAAP measures, see Non-GAAP Measures below.
 
CP will webcast presentations from today's Investor Day session starting with opening remarks at 08:00 mountain time.
 
We encourage you to access the webcast and presentation material at cpInvestorDay.ca.
 
Presentation material will be available on the website at approximately 07:00 mountain time.
 
[1] CP's expectations for adjusted diluted EPS growth in 2018 are based on adjusted diluted EPS of $11.39 in 2017.
 
CP expects approximately $50 million of gains from land sales in the fourth quarter of 2018.
 
Author unknown.