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CN expected to report a doubling of net income in Q2, according to analysts

Last Updated Jul 20, 2021 at 11:32 am MDT

A man walks into central station next to CN headquarters in Montreal, Tuesday, Nov. 26, 2019. THE CANADIAN PRESS/Graham Hughes

MONTREAL — Canadian National Railway Co. is hoping to rebound from last year’s challenging second quarter with analysts expecting net profits to double on a 14 per cent boost in revenues.

The Montreal-based railway is expected to report after markets close net profits of $1.08 billion, up from $545 million in the pandemic-plagued second quarter of 2020, according to financial data firm Refinitiv.

Adjusted profits are forecast to be $1.09 billion or $1.49 per diluted share.

CN’s adjusted profits a year ago were $908 million or $1.28. That was down from $1.25 billion or $1.73 per share in the second quarter of 2019.

Revenues are expected to be $3.66 billion, up from $3.21 billion last year but short of the $3.96 billion in the year prior.

The financial results come as the railway is awaiting a ruling from the U.S. Surface Transportation Board on its application for a voting trust for Kansas City Southern while its $33.6-billion takeover bid is analyzed by the regulator.

CN could be on the hook to pay the U.S. railway a US$1 billion penalty if the voting trust isn’t approved. That’s in addition to US$700 million it has agreed to pay KCS after it backed away from an agreement to be purchased by Calgary-based Canadian Pacific Railway Ltd.

This report by The Canadian Press was first published July 20, 2021.

Companies in this story: (TSX:CNR, TSX:CP)

The Canadian Press