CANADIAN PACIFIC KANSAS CITY LTD/CN
For the period ended Mar 31, 2025. Filed May 1, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 1, 2025
CP$92.17-1.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-10-24.
0000016875-24-000033
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-01.
0000016875-25-000018
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 281 previous paragraphs and 184 current paragraphs.
70 unchanged; 83 reworded; 31 added; 122 removed; 6 previous and 0 current paragraphs rearranged.
Tables are not compared: 31 previous and 20 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (31)
Current report
First Quarter of 2025 Results
Current report
•Total revenues were $3,795 million, an increase of 8% compared to $3,520 million in 2024. The increase was primarily due to higher freight revenue per revenue ton-mile ("RTM") and higher volumes as measured by RTMs.
Current report
•Core adjusted diluted EPS was $1.06, an increase of 14% compared to $0.93 in 2024.
Current report
•Operating ratio was 65.3%, a 210 basis point improvement from 67.4% in 2024.
Current report
•Core adjusted operating ratio was 62.5%, a 150 basis point improvement from 64.0% in 2024.
Current report
•On April 29, 2025, the Company declared a quarterly dividend of $0.228 per share on the outstanding Common Shares, an increase of 20% from $0.190 per share from the prior quarter. The dividend is payable on July 28, 2025 to holders of record at the close of business on June 27, 2025.
Current report
•On April 2, 2025, the Company announced that CPKC and the Lanco Group/Mi-Jack sold the Panama Canal Railway Company to APM Terminals Panama Rail LP, a subsidiary of A.P. Moller - Maersk A/S. The sale closed on April 1, 2025. See Item 1. Financial Statements, Note 14. Subsequent events for further details.
Current report
•On February 27, 2025, the Company announced a normal course issuer bid, commencing March 3, 2025, to purchase up to 37.3 million Common Shares in the open market for cancellation before March 2, 2026. See Part II, Item 2. Unregistered Sales of Equity Securities and Use of Proceeds for further details of share repurchases.
Current report
•greater usage of pooled freight cars by the Company;
Current report
•slower cycle times; and
Current report
•the unfavourable impact of change in FX of $5 million.
Current report
•the unfavorable impact of the change in FX of $14 million; and
Current report
•lower third-party locomotive costs due to insourcing and a new parts agreement embedded in "Materials" effective in the fourth quarter of 2024;
Current report
•lower casualty incident costs; and
Current report
•lower terminal service costs.
Current report
Income Tax Expense
Current report
During the first quarter of 2025, the Company repaid, at maturity, the remaining balance of U.S. $642 million ($930 million) on its 2.90% 10-year Notes.
Current report
During the first quarter of 2025, the Company issued U.S. $600 million 4.80% 5-year unsecured notes due March 30, 2030 for net proceeds of approximately U.S. $596 million ($857 million) and U.S. $600 million 5.20% 10-year unsecured notes due March 30, 2035 for net proceeds of approximately U.S. $593 million ($853 million). The Company also entered into, and fully repaid, a U.S. $500 million unsecured non-revolving term credit facility.
Current report
The Company's revolving credit facility agreement (the "facility") consists of a five-year U.S. $1.1 billion tranche maturing June 25, 2029 and a two-year U.S. $1.1 billion tranche maturing June 25, 2026. As at December 31, 2024 the Company had U.S. $200 million drawn from the two-year U.S. $1.1 billion tranche, which was subsequently repaid in full during the first quarter of 2025. As at March 31, 2025, the facility was undrawn (December 31, 2024 - U.S. $200 million ($288 million)).
Current report
As at March 31, 2025, other than changes to long-term debt, there have been no material changes in our contractual commitments from the year ended December 31, 2024, a description of which can be found in Contractual Commitments of Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations of the Company's Annual Report on Form 10-K. For further information concerning long-term debt, refer to Item 1. Financial Statements, Note 8 Debt.
Current report
•higher principal repayments on long-term debt of $864 million driven by repayment of the 2.90% 10-year Notes at maturity;
Current report
•higher repayments of short-term borrowings and net repayments of commercial paper of $533 million; and
Current report
•the impact of share repurchases of $347 million.
Current report
This increase was partially offset by net proceeds from debt issuances of $1,710 million resulting from the U.S. $600 million 4.80% 5-year unsecured notes due March 30, 2030 and U.S. $600 million 5.20% 10-year unsecured notes due March 30, 2035.
Current report
Statement of Income Information
Current report
Balance Sheet Information
Current report
Beginning in the first quarter of 2025, Core adjusted diluted EPS and Core adjusted operating ratio have been used in continuity of Non-GAAP measures previously known as Core adjusted combined diluted EPS and Core adjusted combined operating ratio. No adjustments are required to Core adjusted combined diluted EPS and Core adjusted combined operating ratio as reported in 2024 to present them on a comparative basis as Core adjusted diluted EPS and Core adjusted operating ratio, as KCS was consolidated within the Company's results throughout the whole year and therefore, no combination adjustments exist.
Current report
Significant items that impact Net income attributable to controlling shareholders as reported on a GAAP basis for the first three months of 2025 and 2024 include:
Current report
•Acquisition-related costs of $20 million in connection with the KCS acquisition ($15 million after current income tax recovery of $5 million) including costs of $5 million recognized in "Compensation and benefits" primarily related to restructuring costs, retention and synergy related incentive compensation costs; $1 million recognized in "Materials"; and $14 million recognized in "Purchased services and other" primarily related to system migration, legal fees, and other third party purchased services, that unfavourably impacted Diluted EPS by 2 cents.
Current report
Core Adjusted Diluted Earnings per Share
Current report
Core Adjusted Operating Ratio
Removed paragraphs (122)
Previous report
Third Quarter of 2024 Results
Previous report
•Core adjusted combined diluted EPS was $0.99, an increase of 8% compared to the same period of 2023.
Previous report
•Operating ratio was 66.1%, a 120 basis point increase compared to the same period of 2023.
Previous report
•Core adjusted combined operating ratio was 62.9%, a 120 basis point increase compared to the same period of 2023.
Previous report
•On August 9, 2024, CPKC issued a notice to the Teamsters Canada Rail Conference ("TCRC") - Train and Engine ("T&E") division and TCRC - Rail Traffic Controller ("RCTC") division, of its plan to lock out employees if the TCRC leadership and the Company were unable to come to a negotiated settlement or agree to binding interest arbitration. On August 18, 2024, the TCRC - T&E division and TCRC - RCTC division issued notice to CPKC, of their plan to exercise their right to strike if the parties were unable to reach negotiated settlements. On August 22, 2024, a work stoppage commenced. The TCRC - T&E represents approximately 3,200 locomotive engineers, conductors and train and yard workers, and the TCRC - RCTC represents approximately 80 rail traffic controllers, all in Canada. On August 26, 2024, CPKC announced it restarted railway operations in Canada following the Canada Industrial Relations Board's order imposing binding interest arbitration and requiring CPKC to resume operations and TCRC employees to resume their duties.
Previous report
•On December 1, 2023, CPKC and Genesee & Wyoming Inc. ("G&W") entered into an agreement in which G&W will transfer to CPKC the track and roadway assets owned by Meridian & Bigbee Railroad, L.L.C. (a G&W-owned company) located between Meridian, Mississippi and Myrtlewood, Alabama, and in exchange, CPKC will transfer certain assets and operating rights to G&W or its subsidiaries. The transaction was approved subject to certain conditions, by the United States Surface Transportation Board (the “STB”), on October 17, 2024 and the STB’s decision will be effective on November 16, 2024.
Previous report
The increase in GTMs in the first nine months of 2024 was primarily due to the impact of the KCS acquisition and higher volumes of U.S. grain, Energy, chemicals and plastics, Potash, international intermodal, and Automotive, partially offset by lower volumes of Metals, minerals and consumer products.
Previous report
The increase in train miles in the first nine months of 2024 reflected the impact of a 16% increase in workload (GTMs) and a 4% decrease in average train weights, which was primarily due to the impact of the KCS acquisition.
Previous report
Total Revenues
Previous report
The increase in Freight revenues in the first nine months of 2024 was primarily due to the impact of the KCS acquisition of $1,375 million, higher volumes as measured by RTMs, and increased freight revenue per RTM. The increase in Non-freight revenues was primarily due to higher revenue from a fibre optic agreement and the impact of the KCS acquisition of $21 million.
Previous report
RTMs
Previous report
The increase in RTMs in the first nine months of 2024 was primarily due to the impact of the KCS acquisition and higher volumes of U.S. grain, Energy, chemicals and plastics, Potash, international intermodal, and Automotive, partially offset by lower volumes of Metals, minerals and consumer products.
Previous report
Freight Revenue per RTM
Previous report
The increase in freight revenue per RTM in the first nine months of 2024 was primarily due to higher freight rates and the favourable impact of the change in FX of $67 million, partially offset by the unfavourable impact of lower fuel prices on fuel surcharge revenue of $77 million.
Previous report
In the first nine months of 2024, fuel surcharge revenues were$1,254 million, an increase of $138 million, or 12%, from $1,116 million in the same period of 2023. This increase was primarily due to the impact of the KCS acquisition, higher volumes, increased carbon levy surcharge revenue, the favourable impact from the timing of recoveries under the Company's fuel cost adjustment program, and the favourable impact of the change in FX, partially offset by lower fuel prices.
Previous report
The increase in Grain revenue in the third quarter of 2024 was primarily due to higher volumes of U.S. grain, primarily soybeans and wheat to Mexico and corn to the U.S. Pacific Northwest, higher volumes of Canadian grain to Mexico and Vancouver, British Columbia ("B.C."), and increased freight revenue per RTM. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX. RTMs increased while carloads remained flat due to moving higher volumes of U.S. grain from the U.S. Midwest to Mexico and the U.S. Pacific Northwest, which have longer lengths of haul.
Previous report
The increase in Coal revenue in the third quarter of 2024 was primarily due to increased freight revenue per RTM and higher volumes of Canadian coal to Kamloops, B.C. This increase was partially offset by lower volumes of U.S. coal primarily driven by lower natural gas prices, which decreases demand for thermal coal, lower volumes of Canadian coal to Vancouver, and the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates. Carloads decreased more than RTMs due to moving lower volumes of U.S. coal versus Canadian coal, which has a shorter average length of haul.
Previous report
The increase in Potash revenue in the third quarter of 2024 was primarily due to higher volumes of export potash to Vancouver and Kamloops as a result of the prior year impact of the International Longshore and Warehouse Union's ("ILWU") strike in July 2023, higher volumes of export potash to the U.S. Pacific Northwest due to recovery of operations following an equipment failure at the Port of Portland, Oregon in 2023, and higher freight rates. This increase was partially offset by decreased freight revenue per RTM, lower volumes of export potash to Chicago, Illinois, and lower volumes of domestic potash. Freight revenue per RTM decreased due to the unfavourable impact of lower fuel prices on fuel surcharge revenue. RTMs increased more than carloads due to moving higher volumes of export potash to Vancouver, which has a longer length of haul.
Previous report
Fertilizers and sulphur revenue was flat in the third quarter of 2024 primarily due to higher freight rates, higher volumes of wet fertilizers, and the favourable impact of the change in FX, offset by decreased freight revenue per RTM. Freight revenue per RTM decreased due to the unfavourable impact of lower fuel prices on fuel surcharge revenue.
Previous report
The decrease in Forest products revenue in the third quarter of 2024 was primarily due to lower volumes of paperboard and wood pulp and the unfavourable impact of lower fuel prices on fuel surcharge revenue. This decrease was partially offset by increased freight revenue per RTM and higher volumes of lumber from Alberta to Texas. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX. Carloads decreased more than RTMs due to moving lower volumes of wood pulp from Ontario to the U.S. Northeast and Québec, which have shorter lengths of haul, and from moving higher volumes of lumber from Alberta to Texas, which has a longer length of haul.
Previous report
The increase in Energy, chemicals and plastics revenue in the first nine months of 2024 was primarily due to the impact of the KCS acquisition, higher volumes of fuel oil, conventional crude from Alberta to Chicago, plastics, and ethylene glycol, and increased freight revenue per RTM, partially offset by the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX.
Previous report
The increase in Metals, minerals and consumer products revenue in the first nine months of 2024 was primarily due to the impact of the KCS acquisition and increased freight revenue per RTM. This increase was partially offset by lower volumes of frac sand to the Bakken and Permian Basin shale formations, lower volumes of steel and aggregates, and the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX. Carloads increased more than RTMs due to the impact of the KCS acquisition as KCS has a shorter average length of haul and due to moving lower volumes of frac sand to the Bakken shale formation, which has a longer length of haul.
Previous report
The increase in Automotive revenue in the third quarter of 2024 was primarily due to higher volumes from Mexico to various locations in North America and from Vancouver to eastern Canada and higher freight rates, partially offset by decreased freight revenue per RTM. Freight revenue per RTM decreased due to the unfavourable impact of lower fuel prices on fuel surcharge revenue and the unfavourable impact of the change in FX. RTMs increased more than carloads due to moving higher volumes from Mexico to the U.S. Midwest and from Vancouver to eastern Canada, which have longer lengths of haul.
Previous report
The decrease in Intermodal revenue in the third quarter of 2024 was primarily due to decreased freight revenue per RTM and lower domestic intermodal volumes between Mexico and Texas. This decrease was partially offset by higher international intermodal volumes to and from the Port of Vancouver, B.C. due to onboarding a new customer and the prior year impact of the ILWU's strike in July 2023, higher freight rates, and the favourable impact of the change in FX. Freight revenue per RTM decreased due to the unfavourable impact of lower fuel prices on fuel surcharge revenue. Carloads decreased while RTMs increased due to moving lower domestic intermodal volumes between Mexico and Texas, which has a shorter length of haul, and moving higher international intermodal volumes to and from the Port of Vancouver, which has a longer length of haul.
Previous report
The increase in Compensation and benefits expense in the first nine months of 2024 was primarily due to the impact of the KCS acquisition of $243 million and the impact of wage and benefit inflation. This increase was partially offset by lower acquisition-related costs incurred by CPKC primarily due to restructuring charges of $50 million incurred by KCS in 2023.
Previous report
The increase in Fuel expense in the first nine months of 2024 was primarily due to the impact of the KCS acquisition of $179 million and the increase in workload, as measured by GTMs. This increase was partially offset by the impact of lower fuel prices of $18 million.
Previous report
The increase in Materials expense in the first nine months of 2024 was primarily due to the impact of the KCS acquisition of $33 million, partially offset by a decrease in freight car maintenance.
Previous report
The increase in Equipment rents expense in the first nine months of 2024 was primarily due to the impact of the KCS acquisition of $37 million and lower recoveries from other railways for their use of the Company's locomotives. This increase was partially offset by greater recoveries from other railways for their use of the Company's freight cars.
Previous report
The increase in Depreciation and amortization expense in the first nine months of 2024, compared to the same period in 2023, was primarily due to the impact of the KCS acquisition of $255 million and a larger depreciable asset base.
Previous report
•a 2023 business interruption insurance recovery of $51 million as a result of settlements reached with insurers by the Company related to a wildfire and flooding in B.C. in 2021;
Previous report
•higher casualty incident cost; and
Previous report
•the impact of the KCS acquisition of $235 million;
Previous report
•a 2023 business interruption insurance recovery of $51 million as a result of settlements reached with insurers by the Company related to a wildfire and flooding in B.C. in 2021;
Previous report
•higher casualty incident cost;
Previous report
•the impact of cost inflation;
Previous report
•higher terminal service costs;
Previous report
•higher environmental management expenses; and
Previous report
•the impact of the change in FX of $10 million.
Previous report
Equity Earnings of Kansas City Southern
Previous report
On April 14, 2023, the Company assumed control of KCS, and ceased recognizing equity earnings of KCS.
Showing the first 40 of 122 passages. Open the source sections for the rest.
Reworded paragraphs (83)
Previous wording
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to enhance a reader’s understanding of the Company’s results of operations and financial condition. The MD&A is provided as a supplement to, and should be read in conjunction with, the Company's Interim Consolidated Financial Statements and the related notes as at and for the three and nine months ended September 30, 2024 in Item 1. Financial Statements, other information in this report, and Item 8. Financial Statements and Supplementary Data of the Company's 2023 Annual Report on Form 10-K. Except where otherwise indicated, all financial information reflected herein is expressed in Canadian dollars.
Current wording
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to enhance a reader’s understanding of the Company’s results of operations and financial condition. The MD&A is provided as a supplement to, and should be read in conjunction with, the Company's Interim Consolidated Financial Statements and the related notes as at and for the three months ended March 31, 2025 in Item 1. Financial Statements, other information in this report, and Item 8. Financial Statements and Supplementary Data of the Company's 2024 Annual Report on Form 10-K. Except where otherwise indicated, all financial information reflected herein is expressed in Canadian dollars.
Previous wording
In this Quarterly Report on Form 10-Q, unless the context indicates otherwise, references to "CPKC", "the Company", "our", or "us" are to Canadian Pacific Kansas City Limited ("CPKC") and its subsidiaries, which includes Kansas City Southern ("KCS") as a consolidated subsidiary on and from April 14, 2023 (the "Control Date"). For the period beginning on January 1, 2023 and ending on April 13, 2023, the Company's 100% interest in KCSwas accounted for and reported as an equity-method investment.
Current wording
In this Quarterly Report on Form 10-Q, unless the context indicates otherwise, references to "CPKC", "the Company", "our", or "us" are to Canadian Pacific Kansas City Limited ("CPKC") and its subsidiaries, which includes Kansas City Southern ("KCS") as a consolidated subsidiary.
Previous wording
•Diluted earnings per share ("EPS") was $0.90, an increase of 7% compared to the same period of 2023.
Current wording
•Diluted earnings per share ("EPS") was $0.97, an increase of 17% compared $0.83 in 2024.
Previous wording
Core adjusted combined diluted EPS and Core adjusted combined operating ratio are defined and reconciled in the "Non-GAAP Measures" section of this Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Current wording
Core adjusted diluted EPS and Core adjusted operating ratio are defined and reconciled in the "Non-GAAP Measures" section of this Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Previous wording
AGTM is defined as the movement of one ton of train weight over one mile. GTMs are calculated by multiplying total train weight by the distance the train moved. Total train weight comprises the weight of the freight cars, their contents, and any inactive locomotives. An increase in GTMs indicates additional workload. The increase in GTMs in the third quarter of 2024 was primarily due to higher volumes of Grain, Potash, Energy, chemicals and plastics, and international intermodal, partially offset by lower volumes of Metals, minerals and consumer products.
Current wording
AGTM is defined as the movement of one ton of train weight over one mile. GTMs are calculated by multiplying total train weight by the distance the train moved. Total train weight comprises the weight of the freight cars, their contents, and any inactive locomotives. An increase in GTMs indicates additional workload. The increase in GTMs in the first quarter of 2025 was primarily due to higher volumes of Coal, Grain, Intermodal, Potash and Automotive.
Previous wording
Train miles are defined as the sum of the distance moved by all trains operated on the network. Train miles provide a measure of the productive utilization of our network. A smaller increase in train miles relative to increases in volumes, as measured by RTMs, and/or workload, as measured by GTMs, indicates improved train productivity. The increase in train miles in the third quarter of 2024 reflected the impact of a 4% increase in workload (GTMs), partially offset by a 2% increase in average train weights.
Current wording
Train miles are defined as the sum of the distance moved by all trains operated on the network. Train miles provide a measure of the productive utilization of our network. A smaller increase in train miles relative to increases in volumes, as measured by RTMs, and/or workload, as measured by GTMs, indicates improved train productivity. The decrease in train miles in the first quarter of 2025 reflects the impact of a 5% increase in average train weights primarily due to improvement in operating plan efficiency and moving longer and heavier Grain trains, partially offset by a 3% increase in workload (GTMs).
Previous wording
Fuel efficiency is defined as U.S. gallons of locomotive fuel consumed per 1,000 GTMs. Fuel consumed includes gallons from freight, yard and commuter service but excludes fuel used in capital projects and other non-freight activities. An improvement in fuel efficiency indicates operational cost savings. The improvement in fuel efficiency in the third quarter of 2024 was due to an improvement in horsepower utilization. The 2% increase in the first nine months of 2024 was due to a decrease in average train weights by 4%, which was primarily due to lower horsepower utilization and harsher winter operating conditions in January 2024.
Current wording
Fuel efficiency is defined as U.S. gallons of locomotive fuel consumed per 1,000 GTMs. Fuel consumed includes gallons from freight, yard and commuter service but excludes fuel used in capital projects and other non-freight activities. An improvement in fuel efficiency indicates operational cost savings. Fuel efficiency in the first quarter of 2025 remained flat compared to the first quarter of 2024.
Previous wording
Anemployee is defined as an individual currently engaged in full-time, part-time, or seasonal employment with the Company. The Company monitors employment and workforce levels in order to efficiently meet service and strategic requirements. The number of employees is a key driver to total compensation and benefits costs. The average number of total employees in the third quarter was relatively unchanged. The increase in the average number of total employees in the first nine months of 2024 was primarily due to the acquisition of KCS.
Current wording
Anemployee is defined as an individual currently engaged in full-time, part-time, or seasonal employment with the Company. The Company monitors employment and workforce levels in order to efficiently meet service and strategic requirements. The number of employees is a key driver of total compensation and benefits costs. The decrease of 1% in the average number of total employees in the first quarter of 2025 was due to efficient resource planning.
Previous wording
The following table presents selected financial data related to the Company’s financial results for the three and nine months ended September 30, 2024 and the comparative periods in 2023.
Current wording
The following table presents selected financial data related to the Company’s financial results for the three months ended March 31, 2025 and the comparative period in 2024.
Previous wording
(2)Operating ratio is defined as total operating expenses divided by total revenues.
Current wording
(2)Operating ratio is defined as operating expenses divided by revenues.
Previous wording
The increase in Freight revenues in the third quarter of 2024 was primarily due to higher volumes as measured by RTMs and increased freight revenue per RTM. The increase in Non-freight revenues was primarily due to higher leasing revenues.
Current wording
The increase in Freight revenues in the first quarter of 2025 was primarily due to higher freight revenue per RTM and higher volumes as measured by RTMs. The decrease in Non-freight revenues was primarily due to lower revenue related to a subsurface fibre optic agreement.
Previous wording
RTMs are defined as the movement of one revenue-producing ton of freight over a distance of one mile. RTMs measure the relative weight and distance of rail freight moved by the Company. The increase in RTMs in the third quarter of 2024 was primarily due to moving higher volumes of Grain, Potash, Energy, chemicals and plastics, and international intermodal, partially offset by lower volumes of Metals, minerals and consumer products.
Current wording
RTMs are defined as the movement of one revenue-producing ton of freight over a distance of one mile. RTMs measure the relative weight and distance of rail freight moved by the Company. The increase in RTMs in the first quarter of 2025 was primarily due to higher volumes of Coal, Grain, Intermodal, Potash, and Automotive.
Previous wording
Freight revenue per RTM is defined as freight revenue per revenue-producing ton of freight over a distance of one mile. This is an indicator of yield. The increase in freight revenue per RTM in the third quarter of 2024 was primarily due to higher freight rates and the favourable impact of the change in foreign exchange "FX" of $20 million, partially offset by the unfavourable impact of lower fuel prices on fuel surcharge revenue of $7 million.
Current wording
Freight revenue per RTM is defined as freight revenue per revenue-producing ton of freight over a distance of one mile. This is an indicator of yield. The increase in freight revenue per RTM in the first quarter of 2025 was primarily due to the favourable impact of the change in foreign exchange ("FX") of $114 million and higher freight rates, partially offset by the unfavourable impact of lower fuel prices on fuel surcharge revenue of $33 million.
Previous wording
Freight revenues include fuel surcharge revenues associated with the Company's fuel cost adjustment program, which is designed to respond to fluctuations in fuel prices and reduce exposure to changes in fuel prices. The surcharge is applied to shippers through tariffs and by contract, within agreed-upon guidelines. This program includes recoveries of carbon taxes, levies, and obligations under cap-and-trade programs. Freight revenues included fuel surcharge revenues of $400 million in the third quarter of 2024, a decrease of $1 million from $401 million in the same period of 2023. This decrease was primarily due to lower fuel prices, partially offset by the favourable impact from the timing of recoveries under the Company's fuel cost adjustment program, increased carbon levy surcharge revenue, and higher volumes.
Current wording
Freight revenues include fuel surcharge revenues associated with the Company's fuel cost adjustment program, which is designed to respond to fluctuations in fuel prices and help reduce exposure to changing fuel prices. The surcharge is applied to shippers through tariffs and by contract, within agreed-upon guidelines. This program includes recoveries of carbon taxes, levies, and obligations under cap-and-trade programs. Freight revenues included fuel surcharge revenues of $402 million in the first quarter of 2025, a decrease of $10 million, or 2%, from $412 million in the same period of 2024. This decrease was primarily due to lower fuel prices, partially offset by increased carbon levy surcharge revenue, higher volumes, and the favourable impact of the change in FX.
Previous wording
The increase in Grain revenue in the first nine months of 2024 was primarily due to the impact of the KCS acquisition, higher volumes of U.S. corn to the U.S. Pacific Northwest and Mexico, higher volumes of U.S. soybeans and wheat and Canadian grain to Mexico, and increased freight revenue per RTM. This increase was partially offset by lower volumes of Canadian grain to Vancouver due to a smaller 2023-2024 crop size and the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX. RTMs increased more than carloads due to moving higher volumes of U.S. grain from the U.S. Midwest to the U.S. Pacific Northwest and Mexico, which have longer lengths of haul.
Current wording
The increase in Grain revenue in the first quarter of 2025 was primarily due to higher volumes of Canadian grain to Vancouver, British Columbia ("B.C.") and Mexico due to a larger crop size for the 2024-2025 crop year, higher volumes of U.S. corn to the U.S. Pacific Northwest and U.S. soybean meal products to Mexico, and an increase in freight revenue per RTM. This increase was partially offset by lower volumes of U.S. corn to Mexico and Alberta, U.S. soybeans to the U.S. Pacific Northwest, and the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to the favourable impact of the change in FX and higher freight rates.
Previous wording
The increase in Coal revenue in the first nine months of 2024 was primarily due to the impact of the KCS acquisition, increased freight revenue per RTM, and higher volumes of Canadian coal to Vancouver. This increase was partially offset by lower volumes of U.S. coal driven by lower natural gas prices, which decreases demand for thermal coal, lower volumes of Canadian coal to Kamloops, and the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX.
Current wording
The increase in Coal revenue in the first quarter of 2025 was primarily due to an increase in freight revenue per RTM, higher volumes of Canadian coal to Kamloops, B.C., Vancouver, and Thunder Bay, Ontario and higher volumes of U.S. coal. This increase was partially offset by the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX.
Previous wording
The increase in Potash revenue in the first nine months of 2024 was primarily due to higher volumes of export potash to the U.S. Pacific Northwest due to recovery of operations following an equipment failure at the Port of Portland in 2023, higher volumes of export potash to Thunder Bay, Ontario, and increased freight revenue per RTM. This increase was partially offset by lower volumes of export potash to Chicago, lower volumes of domestic potash, and the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX. Carloads increased more than RTMs due to moving higher volumes of export potash to the U.S. Pacific Northwest, which has a shorter length of haul.
Current wording
The increase in Potash revenue in the first quarter of 2025 was primarily due to higher volumes of export potash to Vancouver and the U.S. Pacific Northwest and an increase in freight revenue per RTM. This increase was partially offset by lower volumes of export potash to Texas and Kamloops and the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX.
Previous wording
The increase in Fertilizers and sulphur revenue in the first nine months of 2024 was primarily due to higher volumes of dry fertilizers and sulphur moving between Chicago and Alberta, higher volumes of wet fertilizers, the impact of the KCS acquisition, and increased freight revenue per RTM, partially offset by the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX. RTMs increased more than carloads due to moving higher volumes of dry fertilizers and sulphur between Chicago and Alberta, which have longer lengths of haul.
Current wording
The increase in Fertilizers and sulphur revenue in the first quarter of 2025 was primarily due to an increase in freight revenue per RTM and higher volumes of sulphur and wet fertilizers, partially offset by the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to the favourable impact of the change in FX and higher freight rates.
Previous wording
The increase in Forest products revenue in the first nine months of 2024 was primarily due to the impact of the KCS acquisition, higher volumes of lumber from Alberta, B.C., and Ontario to Texas and the U.S. Midwest, higher freight rates, and the favourable impact of the change in FX. This increase was partially offset by lower volumes of wood pulp and paperboard and the unfavourable impact of lower fuel prices on fuel surcharge revenue.
Current wording
The increase in Forest products revenue in the first quarter of 2025 was primarily due to higher volumes of wood pulp and paperboard and an increase in freight revenue per RTM, partially offset by the unfavourable impact of lower fuel prices on fuel surcharge revenue and lower volumes of newsprint. Freight revenue per RTM increased due to the favourable impact of the change in FX and higher freight rates. RTMs increased while carloads decreased due to extending the length of haul of wood pulp from B.C. to Texas, Ontario, and New York and moving lower volumes of wood pulp within B.C., which has a shorter length of haul.
Previous wording
The increase in Energy, chemicals and plastics revenue in the third quarter of 2024 was primarily due to higher volumes of fuel oil, plastics, ethylene glycol, and biofuels, and increased freight revenue per RTM, partially offset by the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX.
Current wording
The increase in Energy, chemicals and plastics revenue in the first quarter of 2025 was primarily due to higher volumes of liquefied petroleum gas, styrene, gasoline, and ethylene glycol and an increase in freight revenue per RTM. This increase was partially offset by lower volumes of crude and the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to the favourable impact of the change in FX and higher freight rates.
Previous wording
The decrease in Metals, minerals and consumer products revenue in the third quarter of 2024 was primarily due to lower volumes of steel and aggregates, lower volumes of frac sand to the Bakken and Permian Basin shale formations, and the unfavourable impact of lower fuel prices on fuel surcharge revenue, partially offset by increased freight revenue per RTM. Freight revenue per RTM increased due to higher freight rates. RTMs decreased more than carloads due to moving lower volumes of frac sand to the Bakken shale formation, which has a longer length of haul.
Current wording
The increase in Metals, minerals and consumer products revenue in the first quarter of 2025 was primarily due to an increase in freight revenue per RTM and higher volumes of frac sand and cement, partially offset by lower volumes of steel and the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to higher freight rates and the favourable impact of the change in FX. Carloads decreased while RTMs remained flat due to moving lower volumes of steel within Mexico, which has a shorter length of haul.
Previous wording
The increase in Automotive revenue in the first nine months of 2024 was primarily due to higher volumes from Mexico to various locations in North America, from Vancouver to eastern Canada, and from Ontario to the U.S. Midwest, the impact of the KCS acquisition, higher freight rates, and the favourable impact of the change in FX. This increase was partially offset by the unfavourable impact of lower fuel prices on fuel surcharge revenue. RTMs increased more than carloads due to moving higher volumes from Mexico to the U.S. Midwest and from Vancouver to eastern Canada, which have longer lengths of haul.
Current wording
The increase in Automotive revenue in the first quarter of 2025 was primarily due to higher volumes from Mexico to the U.S. Midwest and Texas, from Chicago, Illinois and Kansas City, Missouri to Canada, and from Vancouver to eastern Canada, higher freight rates, and the favourable impact of the change in FX. This increase was partially offset by a decrease in freight revenue per RTM due to the unfavourable impact of lower fuel prices on fuel surcharge revenue. RTMs increased more than carloads due to extending the length of haul from Mexico to the U.S. Midwest and moving higher volumes from Vancouver to eastern Canada, which has a longer length of haul.
Previous wording
The increase in Intermodal revenue in the first nine months of 2024 was primarily due to the impact of the KCS acquisition, higher international intermodal volumes to and from the Port of Vancouver, including onboarding a new customer, higher domestic intermodal wholesale volumes, higher freight rates, and the favourable impact of the change in FX. This increase was partially offset by decreased freight revenue per RTM, lower domestic intermodal volumes between Mexico and Texas, and lower international intermodal volumes to and from the Port of Montréal, Québec. Freight revenue per RTM decreased due to the unfavourable impact of lower fuel prices on fuel surcharge revenue.
Current wording
The increase in Intermodal revenue in the first quarter of 2025 was primarily due to higher domestic intermodal wholesale and retail volumes, higher international intermodal volumes to and from the Port of Saint John and the Port of Lazaro, and an increase in freight revenue per RTM. This increase was partially offset by lower international intermodal volumes to and from the Port of Vancouver and the Port of Montréal and the unfavourable impact of lower fuel prices on fuel surcharge revenue. Freight revenue per RTM increased due to the favourable impact of the change in FX and higher freight rates.
Previous wording
Compensation and benefits expense includes employee wages, salaries, fringe benefits, and stock-based compensation. The increase in Compensation and benefits expense in the third quarter of 2024 was primarily due to an increase in stock-based compensation of $39 million largely driven by the changes in the common share price and the impact of wage and benefit inflation.
Current wording
Compensation and benefits expense includes employee wages, salaries, fringe benefits, and stock-based compensation. The decrease in Compensation and benefits expense in the first quarter of 2025 was primarily due to a decrease in stock-based compensation of $26 million primarily driven by the change in share price, and adjustments to provisions for Mexican taxes of $10 million recognized in 2024. The decrease was partially offset by the impact of wage and benefit inflation.
Previous wording
Fuel expense consists mainly of fuel used by locomotives and includes provincial, state, and federal fuel taxes. The decrease in Fuel expense in the third quarter of 2024 was primarily due to the impact of lower fuel price of $15 million and improved efficiency from running longer and heavier trains. This decrease was partially offset by an increase in workload, as measured by GTMs.
Current wording
Fuel expense consists mainly of fuel used by locomotives and includes provincial, state, and federal fuel taxes. The increase in Fuel expense in the first quarter of 2025 was primarily due to an increase in workload, as measured by GTMs and the unfavourable impact of change in FX of $11 million. The increase was partially offset by the impact of lower fuel prices of $11 million.
Previous wording
Materials expense includes the cost of materials used for the maintenance of track, locomotives, freight cars, and buildings, as well as software sustainment. The increase in Materials expense in the third quarter of 2024 was primarily due to increased locomotive maintenance.
Current wording
Materials expense includes the cost of materials used for the maintenance of track, locomotives, freight cars, and buildings, as well as software sustainment. The increase in Materials expense in the first quarter of 2025 was primarily due to higher locomotive materials costs due to a new parts agreement insourcing a subset of maintenance work with a favourable offset in "Purchased services and other" effective in the fourth quarter of 2024, and increased track maintenance.
Previous wording
Equipment rents expense includes the cost associated with using other railways' freight cars, intermodal equipment, and locomotives, net of recoveries received from other railways for the use of the Company’s equipment. The decrease in Equipment rents expense in the third quarter of 2024 was primarily due to reduced payments from the use of other railways' freight cars and greater recoveries from other railways for their use of the Company's freight cars. This decrease was partially offset by cost inflation.
Current wording
Equipment rents expense includes the cost associated with using other railways' freight cars, intermodal equipment, and locomotives, net of recoveries received from other railways for the use of the Company’s equipment. The increase in Equipment rents expense was primarily due to:
Previous wording
Depreciation and amortization expense is the charge associated with the use of track and roadway, rolling stock, buildings, and other depreciable assets, including assets related to the Company's concession with the Mexican government, as well as amortization of finite life intangible assets. The increase in Depreciation and amortization expense in the third quarter of 2024, compared to the same period in 2023, was primarily due to a larger depreciable asset base.
Current wording
Depreciation and amortization expense is the charge associated with the use of track and roadway, rolling stock, buildings, and other depreciable assets, including assets related to a concession granted by the Mexican government, as well as amortization of finite life intangible assets. The increase in Depreciation and amortization expense in the first quarter of 2025 was primarily due to a higher depreciable asset base increasing depreciation by $16 million and the unfavourable impact of the change in FX of $19 million.
Previous wording
Purchased services and other expense encompasses a wide range of third-party costs, including expenses for joint facilities, personal injury and damage claims, environmental remediation, property taxes, contractor and consulting fees, and insurance. The increase in Purchased services and other expense in the third quarter of 2024 was primarily due to:
Current wording
Purchased services and other expense encompasses a wide range of third-party costs, including expenses for joint facilities, personal injury and damage claims, provisions for environmental remediation, property taxes, contractor and consulting fees, and insurance premiums. The increase in Purchased services and other expense in the first quarter of 2025 was primarily due to:
Previous wording
This increase was partially offset by a one-time fee of $34 million (U.S. $25 million) received in connection with the Company's agreement to waive a departing executive's non-competition agreement with respect to their employment with Norfolk Southern Corporation and lower acquisition-related costs incurred by CPKC.
Current wording
•a one-time fee of $34 million (U.S. $25 million) received in 2024 in connection with the Company's agreement to waive a departing executive's non-competition agreement with respect to their employment with Norfolk Southern Corporation;
Previous wording
•Total revenues were $3,549 million, an increase of 6% compared to the same period of 2023. The increase was primarily due to higher volumes as measured by revenue ton-miles ("RTMs") and increased freight revenue per RTM.
Current wording
The increase was partially offset by:
Previous wording
Other expense (income) consists of gains and losses from the change in FX on cash and working capital, the impact of foreign currency forwards, financing costs, shareholder costs, equity earnings, and other non-operating expenditures.
Current wording
Other expense (income) consists of gains and losses from the change in FX on cash and working capital, financing costs, shareholder costs, equity earnings, and other non-operating expenditures. Other expense was $7 million in the first quarter of 2025, a change of $9 million, or 450%, compared to income of $2 million in the same period of 2024. This change was primarily due to the unfavourable impact of net FX losses on U.S. denominated cash and working capital compared to net FX gains in the same period of 2024.
Previous wording
Other components of net periodic benefit recovery are related to the Company's pension and other post-retirement and post-employment benefit plans. It includes interest cost on benefit obligation, expected return on plan assets, recognized net actuarial loss, and amortization of prior service costs. Other components of net periodic benefit recovery was $89 million and $265 million for the three and nine months ended September 30, 2024, an increase of $4 million or 5%, and $11 million or 4%, respectively, compared to the same periods of 2023. These increases were primarily due to a decrease in the interest cost on benefit obligation for the three and nine months ended September 30, 2024 of $5 million and $13 million, respectively.
Current wording
Other components of net periodic benefit recovery are related to the Company's pension and other post-retirement and post-employment benefit plans. It includes interest cost on benefit obligation, expected return on plan assets, recognized net actuarial loss, and amortization of prior service costs. Other components of net periodic benefit recovery was $107 million in the first quarter of 2025, an increase of $19 million, or 22%, compared to the same period of 2024. The increase was primarily due to an increase in expected return on plan assets of $9 million and a decrease in recognized net actuarial loss of $8 million.
Previous wording
Net interest expense includes interest on long-term debt and finance leases. Net interest expense was $192 million in the third quarter of 2024, a decrease of $15 million, or 7%, from $207 million in the same period of 2023. The decrease was primarily due to lower interest expense of $12 million following repayment of maturing long-term debt.
Current wording
Net interest expense includes interest on long-term debt, short-term debt, and finance leases. Net interest expense was $216 million in the first quarter of 2025, an increase of $10 million, or 5%, from $206 million in the same period of 2024. The increase was primarily due to interest of $16 million incurred on short-term borrowings and the issuance of long-term notes, along with the unfavourable impact of the change in FX of $12 million. The increase was partially offset by lower interest costs of $14 million following the repayment of maturing long-term debt.
Previous wording
Income tax expense was $262 million in the third quarter of 2024, an increase of $4 million, or 2%, from $258 million in the same period of 2023. The increase was primarily due to higher taxable earnings.
Current wording
Income tax expense was $292 million in the first quarter of 2025, an increase of $33 million, or 13%, from $259 million in the same period of 2024. The increase was primarily due to higher taxable earnings.
Previous wording
The effective tax rates in the third quarter and first nine months of 2024 were 23.88% and 24.44%, respectively, compared to 24.88% and 166.83% in the same periods of 2023. The Core adjusted effective income tax rates in the third quarter and first nine months of 2024 were 24.24% and 24.75%, compared to 24.96% and 24.91%, respectively, for the same periods in 2023. The Company's 2024 Core adjusted effective tax rate is expected to be approximately 24.75%. The Core adjusted effective tax rate is a Non-GAAP measure, calculated as the effective tax rate adjusted for significant items as they are not considered indicative of future financial trends either by nature or amount nor provide comparability to past performance. The Company uses the Core adjusted effective tax rate to evaluate CPKC’s operating performance and for planning and forecasting future profitability. Core adjusted effective tax rate also excludes equity earnings of KCS (net of tax) and KCS purchase accounting to provide financial statement users with additional transparency by isolating the impact of KCS purchase accounting. This Non-GAAP measure does not have a standardized meaning and is not defined by GAAP and, therefore, may not be comparable to similar measures presented by other companies. Significant items and KCS purchase accounting are discussed further in Non-GAAP Measures of this Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The Company’s 2024 outlook for its Core adjusted effective tax rate is based on certain assumptions about events and developments that may or may not materialize, or that may be offset entirely or partially by new events and developments. This is discussed further in Item 1A. Risk Factors of the Company's 2023 Annual Report on Form 10-K.
Current wording
The effective income tax rate in the first quarter of 2025 was 24.32% compared to 25.09% in the same period of 2024. The Core adjusted effective tax rate in the first quarter of 2025 was 24.50%, compared to 25.00% in the same period of 2024. The Company's 2025 Core adjusted effective tax rate is expected to be approximately 24.50%. The Core adjusted effective tax rate is a Non-GAAP measure, calculated as the effective tax rate adjusted for significant items as they are not considered indicative of future or past financial trends either by nature or amount. The Company uses the Core adjusted effective tax rate to evaluate CPKC’s operating performance and for planning and forecasting future profitability. Core adjusted effective tax rate also excludes KCS purchase accounting to provide financial statement users with additional transparency by isolating the impact of KCS purchase accounting. This Non-GAAP measure does not have a standardized meaning and is not defined by GAAP and, therefore, may not be comparable to similar measures presented by other companies. Significant items and KCS purchase accounting are discussed further in Non-GAAP Measures of this Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The outlook for the Company’s 2025 Core adjusted effective tax rate is based on certain assumptions about events and developments that may or may not materialize, or that may be offset entirely or partially by new events and developments. This is discussed further in Item 1A. Risk Factors of the Company's 2024 Annual Report on Form 10-K. Refer also to "Forward-Looking Statements" below for further details.
Previous wording
Impact of FX on Earnings and Foreign Exchange Risk
Current wording
Impact of Foreign Exchange on Earnings and Foreign Exchange Risk
Previous wording
Although the Company is headquartered in Canada and reports in Canadian dollars, a significant portion of its revenues, expenses, assets and liabilities including debt are denominated in U.S. dollars and Mexican pesos. In addition, equity earnings of KCS recognized through April 13, 2023 are denominated in U.S. dollars. The value of the Canadian dollar is affected by a number of domestic and international factors, including, without limitation, economic performance, commodity prices, and Canadian, U.S., and international monetary policies. Fluctuations in FX affect the Company’s results because revenues and expenses denominated in U.S. dollars and Mexican pesos are translated into Canadian dollars. U.S. dollar-denominated revenues and expenses increase (decrease) when the Canadian dollar weakens (strengthens) in relation to the U.S. dollar. Mexican peso-denominated revenues and expenses increase (decrease) when the U.S. dollar weakens (strengthens) in relation to the Mexican peso.
Current wording
Although the Company is headquartered in Canada and reports in Canadian dollars, a significant portion of its revenues, expenses, assets and liabilities, including debt, are denominated in U.S. dollars and Mexican pesos ("Ps."). The value of the Canadian dollar is affected by a number of domestic and international factors, including, without limitation, economic performance, commodity prices, and Canadian, U.S., and international monetary policies. Fluctuations in FX affect the Company’s financial results because revenues and expenses denominated in U.S. dollars and Mexican pesos are translated into Canadian dollars. U.S. dollar-denominated revenues and expenses increase (decrease) when the Canadian dollar weakens (strengthens) in relation to the U.S. dollar. Mexican peso-denominated revenues and expenses increase (decrease) when the U.S. dollar weakens (strengthens) in relation to the Mexican peso.
Previous wording
In the third quarter of 2024, the U.S. dollar strengthened to an average rate of $1.36 Canadian/U.S. dollar and the Mexican Peso weakened to an average rate of Ps. 13.88 Mexican Peso/Canadian dollar, compared to $1.34 Canadian/U.S. dollar and Ps. 12.72 Mexican Peso/Canadian dollar in the third quarter of 2023, resulting in an increase in Total revenues of $20 million, an increase in Total operating expenses of $2 million, and an increase in Net interest expense of $3 million from the same period of 2023.
Current wording
In the first quarter of 2025, the U.S. dollar strengthened to an average rate of $1.44 Canadian/U.S. dollar and the Mexican Peso weakened to an average rate of Ps. 14.23 Mexican Peso/Canadian dollar, compared to $1.35 Canadian/U.S. dollar and Ps. 12.61 Mexican Peso/Canadian dollar in the first quarter of 2024, resulting in an increase in Total revenues of $115 million, an increase in Total operating expenses of $55 million, and an increase in "Net interest expense" of $12 million.
Previous wording
On an annualized basis, the Company expects that every $0.01 weakening (or strengthening) of the Canadian dollar relative to the U.S. dollar, positively (or negatively) impacts Total revenues by approximately $73 million (December 31, 2023 – approximately $75 million), negatively (or positively) impacts Operating expenses by approximately $46 million (December 31, 2023 – approximately $46 million), and negatively (or positively) impacts Net interest expense by approximately $5 million (December 31, 2023 – approximately $5 million).
Current wording
On an annualized basis, the Company expects that every $0.01 weakening (or strengthening) of the Canadian dollar relative to the U.S. dollar, positively (or negatively) impacts Total revenues by approximately $76 million (December 31, 2024 – approximately $76 million), negatively (or positively) impacts Operating expenses by approximately $43 million (December 31, 2024 – approximately $43 million), and negatively (or positively) impacts "Net interest expense" by approximately $6 million (December 31, 2024 – approximately $6 million).
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Previous report — wording carried elsewhere
The increase in Purchased services and other expense in the first nine months of 2024 was primarily due to:
Previous report — wording carried elsewhere
•higher current income tax expense due to higher taxable earnings;
Previous report — wording carried elsewhere
In the first nine months of 2024, the U.S. dollar strengthened to an average rate of $1.36 Canadian/U.S. dollar and the Mexican peso strengthened to an average rate of Ps. 13.00 Mexican Peso/Canadian dollar, compared to $1.35 Canadian/U.S. dollar and Ps. 13.20 Mexican Peso/Canadian dollar in the first nine months of 2023, resulting in an increase in Total revenues of $68 million, an increase in Total operating expenses of $35 million, and an increase in interest expense of $6 million from the same period of 2023.
Previous report — wording carried elsewhere
If the Company’s credit ratings were to decline to below investment-grade levels, the Company could experience a significant increase in its interest cost for new debt along with a negative effect on its ability to readily issue new debt.
Previous report — wording carried elsewhere
CPKC will be released and relieved of its obligations under the guarantees after obligations to the holders are satisfied in accordance with the terms of the respective instruments.
Previous report — wording carried elsewhere
More information on the securities under this guarantee structure can be found in Exhibit 22.1 List of Issuers and Guarantor Subsidiaries of this quarterly report.