CEO Luc Jobin is "cautiously optimistic" that any NAFTA changes wont dig in to the bottom line
MONTREAL—Canadian National Railway says it’s “cautiously optimistic” the country won’t be hurt by potential changes to NAFTA even though the automotive sector could be in the crosshairs of U.S. President Donald Trump.
“We don’t expect any significant change, at least not in the foreseeable future and I think most of our customers… are thinking the same sort of optimistic yet cautious approach,” CN chief executive Luc Jobin said in a conference call.
Jobin added that 17 per cent of the railway’s business is within the U.S., which will give it opportunities to grow if manufacturing expands and jobs are created south of the border.
The country’s largest railway also expects to transport three to four per cent more volumes of cargo throughout the year, even though it continues to experience some volatility and weaker conditions in a number of commodity sectors.
“As we look into 2017, North American economic conditions are improving, with favourable consumer confidence which supports progress in many sectors,” said CN’s chief financial officer Ghislain Houle.
The railway transported 87,000 carloads of grain in the quarter and has high hopes for the agricultural commodity. Although crude and oilsand volumes have improved of late, he said the sector should remain relatively muted for the year.
During the quarter, carloadings increased three per cent and revenue ton-miles increased four per cent.
“That is an encouraging sign that the worst of the market correction and several commodity sectors is behind us and brighter prospects lay ahead,” Jobin said.
The country’s largest railway said its expects adjusted earnings this year to increase by about five per cent to approximately about $4.82 per diluted share.