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CALGARY - Property sales and cost cutting measures boosted Canadian Pacific Railway Ltd.'s (TSX:CP) bottom line during the third quarter, despite the economic downturn that took a 20 per cent bite out of operating revenue.
"The impact of lower volumes continues to be a challenge. However, the company performed well, sustaining the operational improvements we realized earlier this year," chief executive Fred Green told a conference call with analysts Tuesday.
Canadian Pacific earned a third-quarter profit of $195.4 million or $1.16 per share, including $68 million from the sale of two properties in Windsor, Ont., and in Western Canada.
A year ago, the railway's profit was $170.7 million or $1.10 a share.
Revenue fell to $1.06 billion from $1.34 billion a year ago.
Operating expenses were down 20 per cent from $964.9 million to $827 million, as the railway worked to make its operations more efficient.
"A fluid railway, strong cost management and lower fuel prices were the primary drivers," chief financial officer Kathryn McQuade said.
The railway has also been "aggressively" managing its staffing levels throughout its network, she said. The average employee count in the third quarter was about 13,352, and is expected to rise somewhat in the fourth quarter as the railway deals with tougher winter conditions.
Brock Winter, Canadian Pacific's vice-president of operations, said the railway ran with 2,000, or 17 per cent, fewer unionized employees during the third quarter.
"However, these are highly valued employees that we'll need for future volume growth and to address retirement attrition," he said.
"As such, where we've had opportunity to enhance value-added work and manage employee retention, we've done so."
Canadian Pacific has taken the brunt of the recession, as demand has dwindled for the wide array of commodities and products it ships along its network.
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