☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Canada | 98-0355078 | ||||||||||
(State or Other Jurisdiction of Incorporation or Organization) | (IRS Employer Identification No.) | ||||||||||
7550 Ogden Dale Road S.E. | |||||||||||
Calgary | AB | T2C 4X9 | |||||||||
(Address of Principal Executive Offices) | (Zip Code) |
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on which Registered | ||||||||||||||||||||||||
Common Shares, without par value, of Canadian Pacific Railway Limited | CP | New York Stock Exchange | ||||||||||||||||||||||||
Toronto Stock Exchange | ||||||||||||||||||||||||||
Perpetual 4% Consolidated Debenture Stock of Canadian Pacific Railway Company | CP/40 | New York Stock Exchange | ||||||||||||||||||||||||
BC87 | London Stock Exchange |
þ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | Smaller reporting company | ☐ | ||||||||||||||||||
Emerging growth company | ☐ |
PART I | Page | |||||||
Item 1. | Business | |||||||
Item 1A. | Risk Factors | |||||||
Item 1B. | Unresolved Staff Comments | |||||||
Item 2. | Properties | |||||||
Item 3. | Legal Proceedings | |||||||
Item 4. | Mine Safety Disclosures | |||||||
Information about our Executive Officers | ||||||||
PART II | ||||||||
Item 5. | Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities | |||||||
Item 6. | Selected Financial Data | |||||||
Item 7. | Management's Discussion and Analysis of Financial Condition and Results of Operations | |||||||
Item 7A. | Quantitative and Qualitative Disclosures About Market Risk | |||||||
Item 8. | Financial Statements and Supplementary Data | |||||||
Item 9. | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure | |||||||
Item 9A. | Controls and Procedures | |||||||
Item 9B. | Other Information | |||||||
PART III | ||||||||
Item 10. | Directors, Executive Officers and Corporate Governance | |||||||
Item 11. | Executive Compensation | |||||||
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | |||||||
Item 13. | Certain Relationships and Related Transactions, and Director Independence | |||||||
Item 14. | Principal Accounting Fees and Services | |||||||
PART IV | ||||||||
Item 15. | Exhibits, Financial Statement Schedule | |||||||
Item 16. | Form 10-K Summary | |||||||
Signatures |
2020 Freight Revenues |
2019 Freight Revenues | 2018 Freight Revenues |
2020 Freight Revenues | 2019 Freight Revenues | 2018 Freight Revenues |
2020 Bulk Revenues | 2019 Bulk Revenues | 2018 Bulk Revenues | ||||||
(43% of Freight Revenues) | (40% of Freight Revenues) | (41% of Freight Revenues) |
2020 Grain Revenues | 2019 Grain Revenues | 2018 Grain Revenues | ||||||
(58% of Bulk Revenues; 24% of Freight Revenues) | (55% of Bulk Revenues; 22% of Freight Revenues) | (53% of Bulk Revenues; 22% of Freight Revenues) |
2020 Coal Revenues | 2019 Coal Revenues | 2018 Coal Revenues | ||||||
(18% of Bulk Revenues; 8% of Freight Revenues) | (22% of Bulk Revenues; 9% of Freight Revenues) | (23% of Bulk Revenues; 9% of Freight Revenues) |
2020 Potash Revenues | 2019 Potash Revenues | 2018 Potash Revenues | ||||||
(15% of Bulk Revenues; 7% of Freight Revenues) | (15% of Bulk Revenues; 6% of Freight Revenues) | (16% of Bulk Revenues; 7% of Freight Revenues) |
2020 Fertilizers & Sulphur Revenues | 2019 Fertilizers & Sulphur Revenues | 2018 Fertilizers & Sulphur Revenues | ||||||
(9% of Bulk Revenues; 4% of Freight Revenues) | (8% of Bulk Revenues; 3% of Freight Revenues) | (8% of Bulk Revenues; 3% of Freight Revenues) |
2020 Merchandise Revenues | 2019 Merchandise Revenues | 2018 Merchandise Revenues | ||||||
(36% of Freight Revenues) | (39% of Freight Revenues) | (37% of Freight Revenues) |
2020 Forest Products Revenues | 2019 Forest Products Revenues | 2018 Forest Products Revenues | ||||||
(12% of Merchandise Revenues; 4% of Freight Revenues) | (10% of Merchandise Revenues; 4% of Freight Revenues) | (11% of Merchandise Revenues; 4% of Freight Revenues) |
2020 Energy, Chemicals & Plastics Revenues | 2019 Energy, Chemicals & Plastics Revenues | 2018 Energy, Chemicals & Plastics Revenues | ||||||
(54% of Merchandise Revenues; 20% of Freight Revenues) | (52% of Merchandise Revenues; 20% of Freight Revenues) | (47% of Merchandise Revenues; 17% of Freight Revenues) |
2020 Metals, Minerals & Consumer Products Revenues | 2019 Metals, Minerals & Consumer Products Revenues | 2018 Metals, Minerals & Consumer Products Revenues | ||||||
(22% of Merchandise Revenues; 8% of Freight Revenues) | (26% of Merchandise Revenues; 10% of Freight Revenues) | (30% of Merchandise Revenues; 11% of Freight Revenues) |
2020 Automotive Revenues | 2019 Automotive Revenues | 2018 Automotive Revenues | ||||||
(12% of Merchandise Revenues; 4% of Freight Revenues) | (12% of Merchandise Revenues; 5% of Freight Revenues) | (12% of Merchandise Revenues; 5% of Freight Revenues) |
2020 Intermodal Revenues | 2019 Intermodal Revenues | 2018 Intermodal Revenues | ||||||
(21% of Freight Revenues) | (21% of Freight Revenues) | (22% of Freight Revenues) |
Canada and U.S. Diversity Percentages(1) | 2020 | 2019 | 2018 | ||||||||
Women | 10 | % | 10 | % | 10 | % | |||||
Persons with disabilities | 3 | % | 3 | % | 2 | % | |||||
Minorities (visible minorities)(2) | 13 | % | 13 | % | 13 | % | |||||
Indigenous peoples (Canada only) | 3 | % | 4 | % | 3 | % |
At December 31, 2020, the breakdown of CP operated track miles is as follows: |
Total | |||||||||
First main track | 13,046 | ||||||||
1,051 | |||||||||
4,261 | |||||||||
878 | |||||||||
19,236 | |||||||||
Age: |
Classification Yards | Intermodal Terminals | Transload Facilities | ||||||||||
Vancouver, British Columbia | Vancouver, British Columbia | Vancouver, British Columbia | ||||||||||
Calgary, Alberta | Calgary, Alberta | Toronto, Ontario | ||||||||||
Edmonton, Alberta | Edmonton, Alberta | Hamilton, Ontario | ||||||||||
Moose Jaw, Saskatchewan | Regina, Saskatchewan | Côte Saint-Luc, Québec | ||||||||||
Winnipeg, Manitoba | Winnipeg, Manitoba | |||||||||||
Vaughan, Ontario | ||||||||||||
Lachine, Québec | ||||||||||||
Chicago, Illinois | ||||||||||||
Minneapolis, Minnesota |
Locomotives | Owned | Leased | Total | Average Age (in years) | ||||||||||
Line haul | 770 | 62 | 832 | 14 | ||||||||||
Road switcher | 566 | 14 | 580 | 30 | ||||||||||
Total locomotives | 1,336 | 76 | 1,412 | 20 |
Freight cars | Owned | Leased | Total | Average Age (in years) | ||||||||||
Box car | 2,502 | 545 | 3,047 | 31 | ||||||||||
Covered hopper | 8,623 | 7,693 | 16,316 | 21 | ||||||||||
Flat car | 1,436 | 998 | 2,434 | 26 | ||||||||||
Gondola | 3,623 | 1,595 | 5,218 | 22 | ||||||||||
Intermodal | 1,315 | 150 | 1,465 | 16 | ||||||||||
Multi-level autorack | 2,800 | 1,017 | 3,817 | 26 | ||||||||||
Company service car | 2,413 | 176 | 2,589 | 45 | ||||||||||
Open top hopper | 113 | — | 113 | 34 | ||||||||||
Tank car | 33 | 32 | 65 | 14 | ||||||||||
Total freight cars | 22,858 | 12,206 | 35,064 | 24 |
Intermodal equipment | Owned | Leased | Total | Average Age (in years) | ||||||||||
Containers | 8,150 | — | 8,150 | 7 | ||||||||||
Chassis | 6,374 | 109 | 6,483 | 12 | ||||||||||
Total intermodal equipment | 14,524 | 109 | 14,633 | 9 |
Name, Age and Position | Business Experience | ||||||||
At-risk pay | |||||||||||||||||||||||||||||||||||
($ thousands) | Long-term incentive awards | ||||||||||||||||||||||||||||||||||
Base salary | Short-term incentive | Performance share units | Stock options | Total direct compensation | % at risk | ||||||||||||||||||||||||||||||
Keith E. Creel President and Chief Executive Officer | 1,538 | 2,979 | 5,870 | 3,642 | 14,029 | 89 | % | ||||||||||||||||||||||||||||
Nadeem S. Velani Executive Vice-President and Chief Financial Officer | 751 | 1,096 | 1,552 | 979 | 4,378 | 83 | % | ||||||||||||||||||||||||||||
John K. Brooks Executive Vice-President and Chief Marketing Officer | 670 | 829 | 1,197 | 697 | 3,393 | 81 | % | ||||||||||||||||||||||||||||
Laird J. Pitz Senior Vice-President and Chief Risk Officer | 529 | 571 | 811 | 503 | 2,414 | 78 | % | ||||||||||||||||||||||||||||
Mark A. Redd Executive Vice-President Operations | 491 | 593 | 605 | 355 | 2,044 | 76 | % | ||||||||||||||||||||||||||||
Robert A. Johnson (1) Retired Executive Vice-President Operations | 478 | 524 | 1,015 | 629 | 2,646 | 82 | % |
and policy development | industry | management | (shareholders and others) | |||||||||
2019 | 2018 | |||||||||||||||||||
Kingsdale | Willis Towers Watson | Kingsdale | Willis Towers Watson | |||||||||||||||||
Executive compensation-related fees | $ 90,000 | $ 74,785 | $ 78,750 | $ 233,309 | ||||||||||||||||
Other fees | $112,821 | $2,598,193 | $111,254 | $2,150,258 | ||||||||||||||||
Total fees | $202,821 | $2,672,978 | $190,004 | $2,383,567 |
2019 (in USD) | % change from 2018 | 2018 (in USD) | ||||||||||
Keith Creel | 1,158,750 | 3.0% | 1,125,000 | |||||||||
Nadeem Velani | 566,500 | 3.0% | 550,000 | |||||||||
John Brooks | 525,000 | 31.3% | 400,000 | |||||||||
Laird Pitz | 400,000 | 6.7% | 375,000 | |||||||||
Mark Redd | 425,000 | 24.4% | 341,700 | |||||||||
Robert Johnson | 458,350 | 3.0% | 445,000 |
Payout as a % of base salary | ||||||||||||||||
Level | Below hurdle | Minimum | Target | Maximum | ||||||||||||
CEO | 0 | % | 62.5 | % | 125 | % | 250 | % | ||||||||
Other named executives | 0 | % | 34.2-45 | % | 68.3-90 | % | 136.7-180 | % |
Performance measure | Why it is important | Threshold (50%) | Target (100%) | Exceptional (200%) | 2019 Reported Result | 2019 STIP Result | Weighting | Score | ||||||||||||||||||||||
Financial measures | ||||||||||||||||||||||||||||||
STIP Operating ratio Operating expenses divided by total revenues based on an assumed fuel price and foreign exchange rate | Continues our focus on driving down costs while focusing on growth strategy | 61.3% | 60.8% | 60.3% | 59.9% | 59.9 | % | 35% | 200% | |||||||||||||||||||||
STIP Operating income ($ millions) Total revenues less total operating expenses based on an assumed foreign exchange rate | Highlights the importance of revenue growth to our corporate strategy | 3,014 | 3,054 | 3,121 | 3,124 | 3,089 | 35% | 152% | ||||||||||||||||||||||
Safety measure | ||||||||||||||||||||||||||||||
FRA Train Accident Frequency Number of FRA reportable train accidents which meet FRA reporting thresholds per million train miles | CP has long been an industry leader in rail safety and we are more focused on it than ever, committed to protecting our people, our communities, our environment and our customers’ goods. As safety is our top priority, in 2019, we increased the weighting of our safety measure within the STIP targets to 20% from 10% | 1.12 | 1.08 | 0.99 | 1.06 | 1.06 | 20% | 122% | ||||||||||||||||||||||
Operating measure | ||||||||||||||||||||||||||||||
Trip Plan Compliance Calculated as the number of shipments completed on time (less than 12 hours late vs. baseline plan), divided by the total number of shipments completed | Trip plan compliance is a detailed schedule of performance and the core of CP’s product offering. It balances between customer needs and what we are capable of delivering It is critical to the service we provide customers and to our growth strategy. Trip plan compliance, as a stand-alone measure, is a relatively new measure at CP | 75% | 80% | 85% | 77.1% | 77.1 | % | 10% | 71% | |||||||||||||||||||||
Corporate performance factor | 155% |
for the CEO has a cap, so his individual performance factor cannot exceed the corporate performance factor. the CEO aligns with the CEO’s overall responsibility for CP’s performance. | ||||||||||||||
Keith Creel, | ||||||||||||||
2019 long-term | ||||||||||||||||||||||||||||
incentive | Allocation | |||||||||||||||||||||||||||
award | Performance share units | Stock options | ||||||||||||||||||||||||||
(grant value) ($) | ($) | (#) | ($) | (#) | ||||||||||||||||||||||||
Keith Creel | | 9,512,269 | | | 5,870,208 | | | 21,901 | | | 3,642,061 | | | 54,202 | | |||||||||||||
Nadeem Velani | | 2,531,053 | | | 1,552,110 | | | 5,788 | | | 978,943 | | | 16,313 | | |||||||||||||
John Brooks | | 1,893,801 | | | 1,196,771 | | | 4,465 | | | 697,030 | | | 10,453 | | |||||||||||||
Laird Pitz | | 1,313,416 | | | 810,534 | | | 3,024 | | | 502,882 | | | 7,484 | | |||||||||||||
Mark Redd | | 959,877 | | 604,824 | 2,167 | | 355,053 | | | 5,293 | | |||||||||||||||||
Robert Johnson | | 1,643,916 | | | 1,014,508 | | | 3,785 | | | 629,408 | | | 9,367 | |
2019 PSU performance measures | Why the measure is important | Threshold (50%) | Target (100%) | Exceptional (200%) | Weighting | |||||||||||||
PSU three-year average return on invested capital (ROIC) Net operating profit after tax divided by average invested capital | Focuses executives on the effective use of capital as we grow Ensures shareholders’ capital is employed in a value-accretive manner | 15.3% | 16% | 16.4% | 70% | |||||||||||||
Total shareholder return Measured over three years. The percentile ranking of CP’s TSX Compound Annual Growth Rate (CAGR) relative to the companies that make up the S&P/TSX 60 | Compares our TSR on the TSX to the broader S&P/TSX60 to reflect our progress relative to the Canadian market Aligns long-term incentive compensation with long-term shareholder interests | 25th percentile | | 50th percentile | | 75th percentile | | 15% | ||||||||||
Total shareholder return Measured over three years. The ordinal ranking of CP’s NYSE CAGR relative to the Class 1 Railroads | Compares our TSR on the NYSE to the publicly traded Class 1 Railroads to ensure we are competitive against our primary competitors. Aligns long-term incentive compensation with long-term shareholder interests | 4th | 3rd | 1st | 15% |
Grant value ($) | # of PSUs | Grant price | ||||||||||
Keith Creel | | 5,870,208 | | | 21,901 | | | US$202.00 (NYSE) | | |||
Nadeem Velani | | 1,552,110 | | | 5,788 | | | $268.16 (TSX) | | |||
John Brooks | | 1,196,771 | | | 4,465 | | | US$202.00 (NYSE) | | |||
Laird Pitz | | 810,534 | | | 3,024 | | | US$202.00 (NYSE) | | |||
Mark Redd | 432,874 171,950 | 1,615 552 | US$202.00 (NYSE) US$234.76 (NYSE) | |||||||||
Robert Johnson | | 1,014,508 | | | 3,785 | | | US$202.00 (NYSE) | |
Grant value ($) | # of options | Grant price | ||||||||||
Keith Creel | | 3,642,061 | | | 54,202 | | | US$205.31 (NYSE) | | |||
Nadeem Velani | | 978,943 | | | 16,313 | | | $271.50 (TSX) | | |||
John Brooks | 502,881 194,149 | 7,484 2,969 | US$205.31 (NYSE) US$202.00 (NYSE) | |||||||||
Laird Pitz | | 502,882 | | | 7,484 | | | US$205.31 (NYSE) | | |||
Mark Redd | 268,508 86,545 | 3,996 1,297 | US$205.31 (NYSE) US$234.76 (NYSE) | |||||||||
Robert Johnson | | 629,408 | | | 9,367 | | | US$205.31 (NYSE) | |
(as at December 31) | 2017 | 2018 | 2019 | |||||||||
Number of options granted | | 369,980 | | | 282,125 | | | 224,730 | | |||
Weighted number of shares outstanding | | 145,863,318 | | | 142,885,817 | | | 138,771,939 | | |||
Burn rate | | 0.25% | | | 0.20% | | | 0.16% | |
Number of options/shares | Percentage of outstanding shares | |||||||
Options outstanding (as at December 31, 2019) | | 1,416,346 | | | 1.03 | % | ||
Options available to grant (as at December 31, 2019) | | 1,098,707 | | | 0.80 | % | ||
Shares issued on exercise of options in 2019 | | 260,267 | | | 0.19 | % | ||
Options granted in 2019 | | 224,730 | | | 0.16 | % |
PSU measures | Threshold (50%) | Target (100%) | Maximum (200%) | PSU result | Weighting | PSU performance factor | ||||||||||||||||||
3 Year Average Adjusted Return on Invested Capital (1) | 14.5% | 15% | 15.5% | 15.9% | 60% | 200% | ||||||||||||||||||
TSR to S&P/TSX Capped Industrial Index | | 25th percentile | | | 50th percentile | | | 75th percentile | | | 80th percentile | | | 20% | | | 200% | | ||||||
TSR to S&P 1500 Road and Rail Index | | 25th percentile | | | 50th percentile | | | 75th percentile | | | 66.7th percentile | | | 20% | | | 167% | | ||||||
PSU performance factor | | 193% | |
President and Chief Executive Officer | Mr. Creel became President and CEO of CP on January 31, Prior to joining CP, Mr. Creel |
(in CAD $‘000) | Value of $100 | |||||||||||||||||||
Compensation awarded ($) | Realized and realizable value of compensation as at December 31, 2019 ($) | Period | Keith Creel ($) | Shareholder ($) | ||||||||||||||||
2017 | 18,780,304 | 48,994,522 | Jan 1, 2017 to Dec 31, 2019 | 260.88 | 178.55 | |||||||||||||||
2018 | 11,491,066 | 14,640,604 | Jan 1, 2018 to Dec 31, 2019 | 127.41 | 147.41 | |||||||||||||||
2019 | 14,029,129 | 15,318,711 | Jan 1, 2019 to Dec 31, 2019 | 109.19 | 138.38 |
Requirement (as a multiple of salary) | Minimum ownership value ($) | Shares ($) | Deferred share units ($) | Total ownership value ($) | Total ownership (as a multiple of salary) | |||||||||
6x | 9,616,608 | 1,166,073 | 10,666,164 | 11,832,237 | 7.38x |
Requirement (as a multiple of salary) | Minimum ownership value ($) | Shares ($) | Deferred share units ($) | Total ownership value ($) | Total ownership (as a multiple of salary) | |||||||||||||||
3x | 2,363,511 | 204,541 | 2,373,218 | 2,577,759 | 3.27x |
Requirement (as a multiple of salary) | Minimum ownership value ($) | Shares ($) | Deferred share units ($) | Total ownership value ($) | Total ownership (as a multiple of salary) | |||||||||||||||
3x | 2,220,821 | 692,832 | 615,076 | 1,307,908 | 1.77x |
Requirement (as a multiple of salary) | Minimum ownership value ($) | Shares ($) | Deferred share units ($) | Total ownership value ($) | Total ownership (as a multiple of salary) | |||||||||||||||
2x | 1,106,550 | 25,724 | 1,485,075 | 1,510,799 | 2.73x |
Mr. Creel began his railroad career at Burlington Northern Railway in 1992 as an intermodal ramp manager in Birmingham, Alabama. He also spent part of his career at Grand Trunk Western Railroad as a superintendent and general manager, and at Illinois Central Railroad as a trainmaster and director of corridor operations, prior to its merger with CN in 1999. | |||||
Mark Redd, 50 Executive Vice-President, Operations | Mr. Redd has been Executive Vice-President Operations since September 1, 2019. Previous to these roles, he was General Manager Operations U.S. West and General Manager Operations Central Division. He was named Prior to joining CP in October 2013, Mr. Redd | ||||
Nadeem Velani, 48 Executive Vice-President | Mr. Velani has been Executive Vice-President and CFO of CP since October 17, 2017. Previous to this appointment, he was the Vice-President and CFO of CP from October 19, 2016, to October 16, 2017, Vice-President, Investor Relations from October 28, 2015, and Assistant Vice-President, Investor Relations from March 11, 2013. Prior to joining CP, Mr. Velani spent 15 years at CN where he Mr. Velani holds a Bachelor of Economics degree from Western University and an MBA in Finance/International Business from McGill University. | ||||
John Brooks, 50 Executive Vice-President and Chief Marketing Officer | Mr. Brooks has been Executive Vice-President and Chief Marketing Officer ("CMO") of CP since February 14, 2019. Previous to this appointment, he was the Senior Vice-President and CMO of CP from February 14, 2017, to February 13, 2019. He has worked in senior marketing roles at CP since he joined the Company in 2007, most recently as Vice-President, Marketing – Bulk and Intermodal. Mr. Brooks began his railroading career with UP and later helped start I&M Rail Link, LLC, which was purchased by DM&E in 2002. Mr. Brooks was Vice-President, Marketing at DM&E prior to it being acquired by CP in 2007. With more than 20 years in the |
Laird Pitz, 76 Senior Vice-President and Chief Risk Officer | Mr. Pitz has been Senior Vice-President and Chief Risk Officer ("CRO") of CP since October 17, 2017. Previously, he was the Vice-President and CRO of CP from October 29, 2014, to October 16, 2017, and the Vice-President, Security and Risk Management of CP from April 2014 to October 2014. Prior to joining CP, Mr. Pitz was retired from March 2012 to April 2014, and Vice-President, Risk Mitigation of CN from September 2003 to March 2012. Mr. Pitz, a Vietnam War veteran and former Federal Bureau of Investigation special agent, is a 40-year career professional who has directed strategic and operational risk mitigation, security and crisis management functions for companies operating in a wide range of fields, including defence, logistics and transportation. | ||||||||
James Clements, 51 Senior Vice-President, Strategic Planning and Technology Transformation | |||||||||
Requirement (as a multiple of salary) | Minimum ownership value ($) | Shares ($) | Deferred share units ($) | Total ownership value ($) | Total ownership (as a multiple of salary) | |||||||||||||||
3x | 1,797,807 | 291,791 | 721,813 | 1,013,604 | 1.69x |
Mr. Clements has been at CP for 26 years and his previous experience covers a wide range of areas of CP’s business, including He has an MBA in Finance/International Business from McGill University and a | |||||
Jeffrey Ellis, 53 Chief Legal Officer and Corporate Secretary | Mr. Ellis has been Chief Legal Officer and Corporate Secretary of CP since November 23, 2015. Mr. Ellis is accountable for the overall strategic leadership, oversight and performance Prior to joining CP in 2015, Mr. Ellis was the U.S. General Counsel at BMO Financial Group ("BMO"). Before joining BMO in 2006, Mr. Ellis was with the law firm of Borden Ladner Gervais LLP in Toronto, Ontario. Mr. Ellis has Bachelor of Arts and Master of Arts degrees from the University of Toronto, Juris Doctor and Master of Laws degrees from Osgoode Hall Law School, and an MBA from the Richard Ivey School of Business, Western University. Mr. Ellis is a member of the bars of New York, Illinois, Ontario and Alberta. | ||||
Mike Foran, 47 Vice-President, Market Strategy and Asset Management | Mr. Foran has been Vice-President, Market Strategy and Asset Management of CP since February 14, 2017. His prior roles with CP include Vice-President Network Transportation from 2014 to 2017, Assistant Vice-President Network Transportation from 2013 to 2014, and General Manager – Asset Management from 2012 to 2013. In over 20 years at CP, Mr. Foran has worked in operations, business development, marketing and general management. Mr. Foran holds an Executive MBA from the Ivey School of Business at Western University and a Bachelor of Commerce from the University of Calgary. | ||||
Michael Redeker, 60 Vice-President and Chief Information Officer | Mr. Redeker has been Vice-President and Chief Information Officer ("CIO") of CP since October 15, 2012. Prior to joining CP, Mr. Redeker was Vice-President and CIO of Alberta Treasury Branch from May 2007 to September 2012. He also spent 11 years at IBM Canada, where he focused on delivering quality information technology services within the financial services industry. | ||||
Chad Rolstad, 44 Vice-President, Human Resources and Chief Culture Officer | Mr. Rolstad has been Vice-President, Human Resources since February 14, 2019, and the Chief Culture Officer since September 1, 2019. Previous to this appointment, he was Assistant Vice-President, Human Resources of CP from August 1, 2018, to February 13, 2019, and Assistant Vice-President, Strategic Procurement of CP from April 10, 2017, to July 31, 2018. Prior to |
Non-equity Incentive plan compensation ($) | ||||||||||||||||||||||||||||||||||||
Name and principal position | Year | Salary ($) | Share-based awards ($) | Option-based awards ($) | Annual incentive plans | Long-term incentive plans | Pension values ($) | All other compensation ($) | Total compensation ($) | |||||||||||||||||||||||||||
Keith E. Creel | 2019 | 1,537,866 | 5,870,208 | 3,642,061 | 2,978,994 | - | 566,343 | 554,930 | 15,150,402 | |||||||||||||||||||||||||||
President and Chief | 2018 | 1,453,595 | 4,369,757 | 2,519,163 | 3,148,551 | - | 452,209 | 543,332 | 12,486,607 | |||||||||||||||||||||||||||
Executive Officer | | 2017 | | | 1,436,594 | | | 4,407,788 | | | 10,516,630 | | | 2,419,292 | | | - | | | 398,894 | | | 926,402 | | | 20,105,600 | | |||||||||
Nadeem S. Velani | 2019 | 751,099 | 1,623,980 | 978,943 | 1,095,729 | - | 214,043 | 59,250 | 4,723,044 | |||||||||||||||||||||||||||
Executive Vice-President | 2018 | 666,946 | 1,199,385 | 688,327 | 1,032,596 | - | 138,925 | 57,680 | 3,783,859 | |||||||||||||||||||||||||||
and Chief Financial Officer | | 2017 | | | 451,355 | | | 806,073 | | | 202,650 | | | 490,763 | | | - | | | 101,027 | | | 49,523 | | | 2,101,391 | | |||||||||
John K. Brooks | 2019 | 670,235 | 1,240,804 | 697,030 | 829,259 | - | 254,186 | 66,651 | 3,758,165 | |||||||||||||||||||||||||||
Executive Vice-President | 2018 | 499,384 | 424,798 | 244,922 | 602,177 | - | 166,898 | 61,456 | 1,999,635 | |||||||||||||||||||||||||||
and Chief Marketing Officer | | 2017 | | | 436,359 | | | 428,442 | | | 125,582 | | | 420,251 | | | - | | | 144,378 | | | 59,567 | | | 1,614,579 | | |||||||||
Laird J. Pitz | 2019 | 529,378 | 810,534 | 502,882 | 571,230 | - | 104,830 | 45,606 | 2,564,460 | |||||||||||||||||||||||||||
Senior Vice-President | 2018 | 482,486 | 444,139 | 256,132 | 560,593 | - | 87,126 | 42,346 | 1,872,822 | |||||||||||||||||||||||||||
and Chief Risk Officer | | 2017 | | | 457,901 | | | 394,237 | | | 228,694 | | | 435,601 | | | - | | | 82,361 | | | 41,137 | | | 1,639,931 | | |||||||||
Mark A. Redd | 2019 | 491,307 | 642,177 | 355,053 | 592,539 | - | 96,231 | 214,626 | 2,391,933 | |||||||||||||||||||||||||||
Executive Vice-President | 2018 | 440,209 | 832,824 | 562,059 | 510,812 | - | 78,942 | 283,124 | 2,707,970 | |||||||||||||||||||||||||||
Operations | | 2017 | | | 415,321 | | | 367,349 | | | 179,664 | | | 391,637 | | | - | | | 69,989 | | | 66,582 | | | 1,490,542 | | |||||||||
Robert A. Johnson | 2019 | 478,386 | 1,014,508 | 629,408 | 523,969 | - | 121,175 | 79,573 | 2,847,019 | |||||||||||||||||||||||||||
Retired Executive Vice- | 2018 | 572,808 | 950,363 | 547,936 | 778,392 | - | 105,825 | 63,858 | 3,019,182 | |||||||||||||||||||||||||||
President Operations | | 2017 | | | 564,891 | | | 958,705 | | | 556,073 | | | 597,372 | | | - | | | 114,037 | | | 54,819 | | | 2,845,897 | |
2020 | Total number of shares purchased(1) | Average price paid per share(2) | Total number of shares purchased as part of publicly announced plans or programs | Maximum number of shares that may yet be purchased under the plans or programs | ||||||||||
October 1 to October 31 | 230,195 | $ | 407.28 | 230,195 | 1,620,676 | |||||||||
November 1 to November 30 | 451,299 | 425.89 | 451,299 | 1,169,377 | ||||||||||
December 1 to December 31 | 640,000 | 429.23 | 640,000 | nil(3) | ||||||||||
Ending Balance | 1,321,494 | $ | 424.26 | 1,321,494 | N/A |
(in millions, except per share data, percentage and ratios) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Financial Performance and Liquidity | |||||||||||||||||
Total revenues | $ | 7,710 | $ | 7,792 | $ | 7,316 | $ | 6,554 | $ | 6,232 | |||||||
Operating income | 3,311 | 3,124 | 2,831 | 2,519 | 2,411 | ||||||||||||
Adjusted operating income(1) | 3,311 | 3,124 | 2,831 | 2,468 | 2,411 | ||||||||||||
Net income | 2,444 | 2,440 | 1,951 | 2,405 | 1,599 | ||||||||||||
Adjusted income(1) | 2,403 | 2,290 | 2,080 | 1,666 | 1,549 | ||||||||||||
Basic earnings per share ("EPS") | 18.05 | 17.58 | 13.65 | 16.49 | 10.69 | ||||||||||||
Diluted EPS | 17.97 | 17.52 | 13.61 | 16.44 | 10.63 | ||||||||||||
Adjusted diluted EPS(1) | 17.67 | 16.44 | 14.51 | 11.39 | 10.29 | ||||||||||||
Dividends declared per share | 3.5600 | 3.1400 | 2.5125 | 2.1875 | 1.8500 | ||||||||||||
Cash provided by operating activities | 2,802 | 2,990 | 2,712 | 2,182 | 2,089 | ||||||||||||
Cash used in investing activities | (2,030) | (1,803) | (1,458) | (1,295) | (1,069) | ||||||||||||
Cash used in financing activities | (764) | (1,111) | (1,542) | (700) | (1,493) | ||||||||||||
Free cash(1) | 1,157 | 1,357 | 1,289 | 874 | 1,007 | ||||||||||||
Financial Position | |||||||||||||||||
Total assets | $ | 23,640 | $ | 22,367 | $ | 21,254 | $ | 20,135 | $ | 19,221 | |||||||
Total long-term debt, including current portion | 9,771 | 8,757 | 8,696 | 8,159 | 8,684 | ||||||||||||
Total shareholders' equity | 7,319 | 7,069 | 6,636 | 6,437 | 4,626 | ||||||||||||
Financial Ratios | |||||||||||||||||
Operating ratio(2) | 57.1 | % | 59.9 | % | 61.3 | % | 61.6 | % | 61.3 | % | |||||||
Adjusted operating ratio(1) | 57.1 | % | 59.9 | % | 61.3 | % | 62.4 | % | 61.3 | % | |||||||
Return on average shareholders' equity(3) | 34.0 | % | 35.6 | % | 29.8 | % | 43.4 | % | 33.9 | % | |||||||
Adjusted return on invested capital ("Adjusted ROIC")(1) | 16.7 | % | 16.9 | % | 16.2 | % | 14.7 | % | 14.0 | % | |||||||
Dividend payout ratio(4) | 19.8 | % | 17.9 | % | 18.5 | % | 13.3 | % | 17.4 | % | |||||||
Adjusted dividend payout ratio(1) | 20.1 | % | 19.1 | % | 17.3 | % | 19.2 | % | 18.0 | % | |||||||
Long-term debt to Net income ratio(5) | 4.0 | 3.6 | 4.5 | 3.4 | 5.4 | ||||||||||||
Adjusted net debt to adjusted EBITDA ratio(1) | 2.5 | 2.4 | 2.6 | 2.6 | 2.9 |
Page | |||||
Executive Summary | |||||
2021 Outlook | |||||
Performance Indicators | |||||
Results of Operations | |||||
Impact of Foreign Exchange on Earnings | |||||
Impact of Fuel Price on Earnings | |||||
Impact of Share Price on Earnings | |||||
Operating Revenues | |||||
Operating Expenses | |||||
Other Income Statement Items | |||||
Liquidity and Capital Resources | |||||
Share Capital | |||||
Non-GAAP Measures | |||||
Off-Balance Sheet Arrangements | |||||
Critical Accounting Estimates | |||||
Forward-Looking Statements |
RTM growth | Adjusted diluted EPS(1) | Capital expenditures | |||||||||
Outlook | Mid-single-digit growth Revised quarterly and updated at the end of the third quarter to low single-digit decrease | High single-digit to low double-digit growth Revised quarterly and updated at the end of the third quarter to at least mid-single-digit Adjusted diluted EPS growth from full-year 2019 Adjusted diluted EPS of $16.44. | Approximately $1.60 billion | ||||||||
Actual outcomes | RTMs decreased by 2,487 million, or 2% | Adjusted diluted EPS growth of 7% to $17.67 | $1.67 billion |
% Change | |||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | 2020 vs. 2019 | 2019 vs. 2018 | ||||||||||||
Operations Performance | |||||||||||||||||
Gross ton-miles (“GTMs”) (millions) | 272,360 | 280,724 | 275,362 | (3) | 2 | ||||||||||||
Train miles (thousands) | 30,324 | 32,924 | 32,312 | (8) | 2 | ||||||||||||
Average train weight – excluding local traffic (tons) | 9,707 | 9,129 | 9,100 | 6 | — | ||||||||||||
Average train length – excluding local traffic (feet) | 7,929 | 7,388 | 7,313 | 7 | 1 | ||||||||||||
Average terminal dwell (hours) | 6.5 | 6.4 | 6.8 | 2 | (6) | ||||||||||||
Average train speed (miles per hour, or "mph") | 22.0 | 22.2 | 21.5 | (1) | 3 | ||||||||||||
Locomotive productivity (GTMs / operating horsepower, or "GTMs/OHP") | 207 | 202 | 198 | 2 | 2 | ||||||||||||
Fuel efficiency (U.S. gallons of locomotive fuel consumed /1,000 GTMs) | 0.942 | 0.955 | 0.953 | (1) | — | ||||||||||||
Total Employees and Workforce | |||||||||||||||||
Total employees (average) | 12,168 | 13,103 | 12,756 | (7) | 3 | ||||||||||||
Total employees (end of period) | 11,890 | 12,694 | 12,840 | (6) | (1) | ||||||||||||
Workforce (end of period) | 11,904 | 12,732 | 12,866 | (7) | (1) | ||||||||||||
Safety Indicators(1) | |||||||||||||||||
FRA personal injuries per 200,000 employee-hours | 1.11 | 1.42 | 1.47 | (22) | (3) | ||||||||||||
FRA train accidents per million train-miles | 0.96 | 1.06 | 1.10 | (9) | (4) |
Average exchange rates (Canadian/U.S. dollar) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
For the year ended – December 31 | $ | 1.34 | $ | 1.33 | $ | 1.30 | $ | 1.30 | $ | 1.33 | |||||||
For the three months ended – December 31 | $ | 1.30 | $ | 1.32 | $ | 1.32 | $ | 1.27 | $ | 1.33 |
Exchange rates (Canadian/U.S. dollar) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Beginning of year – January 1 | $ | 1.30 | $ | 1.36 | $ | 1.25 | $ | 1.34 | $ | 1.38 | |||||||
Beginning of quarter – April 1 | $ | 1.41 | $ | 1.33 | $ | 1.29 | $ | 1.33 | $ | 1.30 | |||||||
Beginning of quarter – July 1 | $ | 1.36 | $ | 1.31 | $ | 1.32 | $ | 1.30 | $ | 1.29 | |||||||
Beginning of quarter – October 1 | $ | 1.33 | $ | 1.32 | $ | 1.29 | $ | 1.25 | $ | 1.31 | |||||||
End of year – December 31 | $ | 1.28 | $ | 1.30 | $ | 1.36 | $ | 1.25 | $ | 1.34 |
High/Low exchange rates (Canadian/U.S. dollar) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
High | $ | 1.45 | $ | 1.36 | $ | 1.37 | $ | 1.37 | $ | 1.46 | |||||||
Low | $ | 1.27 | $ | 1.30 | $ | 1.23 | $ | 1.21 | $ | 1.25 |
Average Fuel Price (U.S. dollars per U.S. gallon) | 2020 | 2019 | 2018 | ||||||||
For the year ended – December 31 | $ | 1.90 | $ | 2.49 | $ | 2.72 | |||||
For the three months ended – December 31 | $ | 1.91 | $ | 2.53 | $ | 2.71 |
Toronto Stock Exchange (in Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
Opening Common Share price, as at January 1 | $ | 331.03 | $ | 242.24 | $ | 229.66 | |||||
Ending Common Share price, as at March 31 | $ | 310.55 | $ | 275.34 | $ | 227.20 | |||||
Ending Common Share price, as at June 30 | $ | 345.32 | $ | 308.43 | $ | 240.92 | |||||
Ending Common Share price, as at September 30 | $ | 405.05 | $ | 294.42 | $ | 273.23 | |||||
Ending Common Share price, as at December 31 | $ | 441.53 | $ | 331.03 | $ | 242.24 | |||||
Change in Common Share price for the year ended December 31 | $ | 110.50 | $ | 88.79 | $ | 12.58 |
New York Stock Exchange (in U.S. dollars) | 2020 | 2019 | 2018 | ||||||||
Opening Common Share price, as at January 1 | $ | 254.95 | $ | 177.62 | $ | 182.76 | |||||
Ending Common Share price, as at March 31 | $ | 219.59 | $ | 206.03 | $ | 176.50 | |||||
Ending Common Share price, as at June 30 | $ | 255.34 | $ | 235.24 | $ | 183.02 | |||||
Ending Common Share price, as at September 30 | $ | 304.43 | $ | 222.46 | $ | 211.94 | |||||
Ending Common Share price, as at December 31 | $ | 346.69 | $ | 254.95 | $ | 177.62 | |||||
Change in Common Share price for the year ended December 31 | $ | 91.74 | $ | 77.33 | $ | (5.14) |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(2) | Total Change | % Change | FX Adjusted % Change(2) | |||||||||||||||||||||||
Freight revenues (in millions)(1) | $ | 7,541 | $ | 7,613 | $ | 7,152 | $ | (72) | (1) | (1) | $ | 461 | 6 | 5 | ||||||||||||||||||
Non-freight revenues (in millions) | 169 | 179 | 164 | (10) | (6) | (6) | 15 | 9 | 8 | |||||||||||||||||||||||
Total revenues (in millions) | $ | 7,710 | $ | 7,792 | $ | 7,316 | $ | (82) | (1) | (1) | $ | 476 | 7 | 5 | ||||||||||||||||||
Carloads (in thousands) | 2,708.4 | 2,766.4 | 2,739.8 | (58.0) | (2) | N/A | 26.6 | 1 | N/A | |||||||||||||||||||||||
Revenue ton-miles (in millions) | 151,891 | 154,378 | 154,207 | (2,487) | (2) | N/A | 171 | — | N/A | |||||||||||||||||||||||
Freight revenue per carload (in dollars) | $ | 2,784 | $ | 2,752 | $ | 2,611 | $ | 32 | 1 | 1 | $ | 141 | 5 | 4 | ||||||||||||||||||
Freight revenue per revenue ton-mile (in cents) | 4.96 | 4.93 | 4.64 | 0.03 | 1 | — | 0.29 | 6 | 5 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(1) | Total Change | % Change | FX Adjusted % Change(1) | |||||||||||||||||||||||
Freight revenues (in millions) | $ | 1,829 | $ | 1,684 | $ | 1,566 | $ | 145 | 9 | 8 | $ | 118 | 8 | 6 | ||||||||||||||||||
Carloads (in thousands) | 480.1 | 431.4 | 429.4 | 48.7 | 11 | N/A | 2.0 | — | N/A | |||||||||||||||||||||||
Revenue ton-miles (in millions) | 41,747 | 36,941 | 36,856 | 4,806 | 13 | N/A | 85 | — | N/A | |||||||||||||||||||||||
Freight revenue per carload (in dollars) | $ | 3,810 | $ | 3,904 | $ | 3,645 | $ | (94) | (2) | (3) | $ | 259 | 7 | 6 | ||||||||||||||||||
Freight revenue per revenue ton-mile (in cents) | 4.38 | 4.56 | 4.25 | (0.18) | (4) | (4) | 0.31 | 7 | 6 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(1) | Total Change | % Change | FX Adjusted % Change(1) | |||||||||||||||||||||||
Freight revenues (in millions) | $ | 566 | $ | 682 | $ | 673 | $ | (116) | (17) | (17) | $ | 9 | 1 | 1 | ||||||||||||||||||
Carloads (in thousands) | 260.4 | 304.3 | 304.3 | (43.9) | (14) | N/A | — | — | N/A | |||||||||||||||||||||||
Revenue ton-miles (in millions) | 18,510 | 21,820 | 22,443 | (3,310) | (15) | N/A | (623) | (3) | N/A | |||||||||||||||||||||||
Freight revenue per carload (in dollars) | $ | 2,174 | $ | 2,241 | $ | 2,211 | $ | (67) | (3) | (3) | $ | 30 | 1 | 1 | ||||||||||||||||||
Freight revenue per revenue ton-mile (in cents) | 3.06 | 3.13 | 3.00 | (0.07) | (2) | (2) | 0.13 | 4 | 4 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(1) | Total Change | % Change | FX Adjusted % Change(1) | |||||||||||||||||||||||
Freight revenues (in millions) | $ | 493 | $ | 462 | $ | 486 | $ | 31 | 7 | 6 | $ | (24) | (5) | (6) | ||||||||||||||||||
Carloads (in thousands) | 162.9 | 149.3 | 158.4 | 13.6 | 9 | N/A | (9.1) | (6) | N/A | |||||||||||||||||||||||
Revenue ton-miles (in millions) | 18,784 | 17,297 | 18,371 | 1,487 | 9 | N/A | (1,074) | (6) | N/A | |||||||||||||||||||||||
Freight revenue per carload (in dollars) | $ | 3,026 | $ | 3,094 | $ | 3,071 | $ | (68) | (2) | (3) | $ | 23 | 1 | — | ||||||||||||||||||
Freight revenue per revenue ton-mile (in cents) | 2.62 | 2.67 | 2.65 | (0.05) | (2) | (2) | 0.02 | 1 | — |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(1) | Total Change | % Change | FX Adjusted % Change(1) | |||||||||||||||||||||||
Freight revenues (in millions) | $ | 290 | $ | 250 | $ | 243 | $ | 40 | 16 | 15 | $ | 7 | 3 | 1 | ||||||||||||||||||
Carloads (in thousands) | 61.6 | 57.0 | 58.1 | 4.6 | 8 | N/A | (1.1) | (2) | N/A | |||||||||||||||||||||||
Revenue ton-miles (in millions) | 4,683 | 3,846 | 4,051 | 837 | 22 | N/A | (205) | (5) | N/A | |||||||||||||||||||||||
Freight revenue per carload (in dollars) | $ | 4,708 | $ | 4,386 | $ | 4,186 | $ | 322 | 7 | 6 | $ | 200 | 5 | 3 | ||||||||||||||||||
Freight revenue per revenue ton-mile (in cents) | 6.19 | 6.50 | 6.00 | (0.31) | (5) | (5) | 0.50 | 8 | 7 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(1) | Total Change | % Change | FX Adjusted % Change(1) | |||||||||||||||||||||||
Freight revenues (in millions) | $ | 328 | $ | 304 | $ | 284 | $ | 24 | 8 | 7 | $ | 20 | 7 | 5 | ||||||||||||||||||
Carloads (in thousands) | 71.6 | 71.5 | 68.6 | 0.1 | — | N/A | 2.9 | 4 | N/A | |||||||||||||||||||||||
Revenue ton-miles (in millions) | 5,491 | 4,974 | 4,763 | 517 | 10 | N/A | 211 | 4 | N/A | |||||||||||||||||||||||
Freight revenue per carload (in dollars) | $ | 4,581 | $ | 4,252 | $ | 4,139 | $ | 329 | 8 | 7 | $ | 113 | 3 | 1 | ||||||||||||||||||
Freight revenue per revenue ton-mile (in cents) | 5.97 | 6.11 | 5.96 | (0.14) | (2) | (3) | 0.15 | 3 | 1 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(1) | Total Change | % Change | FX Adjusted % Change(1) | |||||||||||||||||||||||
Freight revenues (in millions) | $ | 1,519 | $ | 1,534 | $ | 1,243 | $ | (15) | (1) | (1) | $ | 291 | 23 | 22 | ||||||||||||||||||
Carloads (in thousands) | 308.8 | 358.1 | 334.6 | (49.3) | (14) | N/A | 23.5 | 7 | N/A | |||||||||||||||||||||||
Revenue ton-miles (in millions) | 24,172 | 29,356 | 27,830 | (5,184) | (18) | N/A | 1,526 | 5 | N/A | |||||||||||||||||||||||
Freight revenue per carload (in dollars) | $ | 4,919 | $ | 4,284 | $ | 3,715 | $ | 635 | 15 | 15 | $ | 569 | 15 | 14 | ||||||||||||||||||
Freight revenue per revenue ton-mile (in cents) | 6.28 | 5.23 | 4.47 | 1.05 | 20 | 20 | 0.76 | 17 | 15 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(1) | Total Change | % Change | FX Adjusted % Change(1) | |||||||||||||||||||||||
Freight revenues (in millions) | $ | 629 | $ | 752 | $ | 797 | $ | (123) | (16) | (17) | $ | (45) | (6) | (8) | ||||||||||||||||||
Carloads (in thousands) | 207.3 | 234.3 | 252.2 | (27.0) | (12) | N/A | (17.9) | (7) | N/A | |||||||||||||||||||||||
Revenue ton-miles (in millions) | 9,325 | 10,684 | 11,858 | (1,359) | (13) | N/A | (1,174) | (10) | N/A | |||||||||||||||||||||||
Freight revenue per carload (in dollars) | $ | 3,034 | $ | 3,210 | $ | 3,161 | $ | (176) | (5) | (6) | $ | 49 | 2 | — | ||||||||||||||||||
Freight revenue per revenue ton-mile (in cents) | 6.75 | 7.04 | 6.72 | (0.29) | (4) | (5) | 0.32 | 5 | 3 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(1) | Total Change | % Change | FX Adjusted % Change(1) | |||||||||||||||||||||||
Freight revenues (in millions) | $ | 324 | $ | 352 | $ | 322 | $ | (28) | (8) | (9) | $ | 30 | 9 | 7 | ||||||||||||||||||
Carloads (in thousands) | 106.1 | 114.4 | 108.3 | (8.3) | (7) | N/A | 6.1 | 6 | N/A | |||||||||||||||||||||||
Revenue ton-miles (in millions) | 1,321 | 1,427 | 1,347 | (106) | (7) | N/A | 80 | 6 | N/A | |||||||||||||||||||||||
Freight revenue per carload (in dollars) | $ | 3,054 | $ | 3,077 | $ | 2,975 | $ | (23) | (1) | (2) | $ | 102 | 3 | 1 | ||||||||||||||||||
Freight revenue per revenue ton-mile (in cents) | 24.53 | 24.67 | 23.92 | (0.14) | (1) | (1) | 0.75 | 3 | 1 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(1) | Total Change | % Change | FX Adjusted % Change(1) | |||||||||||||||||||||||
Freight revenues (in millions) | $ | 1,563 | $ | 1,593 | $ | 1,538 | $ | (30) | (2) | (2) | $ | 55 | 4 | 3 | ||||||||||||||||||
Carloads (in thousands) | 1,049.6 | 1,046.1 | 1,025.9 | 3.5 | — | N/A | 20.2 | 2 | N/A | |||||||||||||||||||||||
Revenue ton-miles (in millions) | 27,858 | 28,033 | 26,688 | (175) | (1) | N/A | 1,345 | 5 | N/A | |||||||||||||||||||||||
Freight revenue per carload (in dollars) | $ | 1,489 | $ | 1,523 | $ | 1,499 | $ | (34) | (2) | (2) | $ | 24 | 2 | 1 | ||||||||||||||||||
Freight revenue per revenue ton-mile (in cents) | 5.61 | 5.68 | 5.76 | (0.07) | (1) | (2) | (0.08) | (1) | (2) |
2020 Operating Expenses | 2019 Operating Expenses | 2018 Operating Expenses |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
For the year ended December 31 (in millions of Canadian dollars) | 2020 | 2019 | 2018 | Total Change | % Change | FX Adjusted % Change(1) | Total Change | % Change | FX Adjusted % Change(1) | |||||||||||||||||||||||
Compensation and benefits | $ | 1,560 | $ | 1,540 | $ | 1,468 | $ | 20 | 1 | 1 | $ | 72 | 5 | 4 | ||||||||||||||||||
Fuel | 652 | 882 | 918 | (230) | (26) | (27) | (36) | (4) | (6) | |||||||||||||||||||||||
Materials | 216 | 210 | 201 | 6 | 3 | 3 | 9 | 4 | 4 | |||||||||||||||||||||||
Equipment rents | 142 | 137 | 130 | 5 | 4 | 2 | 7 | 5 | 3 | |||||||||||||||||||||||
Depreciation and amortization | 779 | 706 | 696 | 73 | 10 | 10 | 10 | 1 | 1 | |||||||||||||||||||||||
Purchased services and other | 1,050 | 1,193 | 1,072 | (143) | (12) | (12) | 121 | 11 | 10 | |||||||||||||||||||||||
Total operating expenses | $ | 4,399 | $ | 4,668 | $ | 4,485 | $ | (269) | (6) | (6) | $ | 183 | 4 | 3 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||
For the year ended December 31 (in millions of Canadian dollars) | 2020 | 2019 | 2018 | Total Change | % Change | Total Change | % Change | |||||||||||||||||||
Support and facilities | $ | 271 | $ | 278 | $ | 264 | $ | (7) | (3) | $ | 14 | 5 | ||||||||||||||
Track and operations | 282 | 278 | 268 | 4 | 1 | 10 | 4 | |||||||||||||||||||
Intermodal | 209 | 222 | 221 | (13) | (6) | 1 | — | |||||||||||||||||||
Equipment | 113 | 125 | 143 | (12) | (10) | (18) | (13) | |||||||||||||||||||
Casualty | 116 | 149 | 73 | (33) | (22) | 76 | 104 | |||||||||||||||||||
Property taxes | 126 | 133 | 124 | (7) | (5) | 9 | 7 | |||||||||||||||||||
Other | (57) | 29 | 20 | (86) | (297) | 9 | 45 | |||||||||||||||||||
Land sales | (10) | (21) | (41) | 11 | (52) | 20 | (49) | |||||||||||||||||||
Total Purchased services and other | $ | 1,050 | $ | 1,193 | $ | 1,072 | $ | (143) | (12) | $ | 121 | 11 |
For the year ended December 31 (in millions of Canadian dollars, except for track miles and crossties) | 2020 | 2019 | 2018 | ||||||||
Additions to capital | |||||||||||
Track and roadway | $ | 1,161 | $ | 1,004 | $ | 965 | |||||
Rolling stock (1) | 253 | 393 | 318 | ||||||||
Information systems software (2) | 45 | 55 | 53 | ||||||||
Buildings (3) | 103 | 58 | 54 | ||||||||
Other (3) | 126 | 154 | 184 | ||||||||
Total – accrued additions to capital | 1,688 | 1,664 | 1,574 | ||||||||
Less: | |||||||||||
Non-cash transactions | 17 | 17 | 23 | ||||||||
Cash invested in additions to properties (per Consolidated Statements of Cash Flows) | $ | 1,671 | $ | 1,647 | $ | 1,551 | |||||
Track installation capital programs | |||||||||||
Track miles of rail laid (miles) | 301 | 246 | 281 | ||||||||
Track miles of rail capacity expansion (miles) | 28 | 11 | 4 | ||||||||
Crossties installed (thousands) | 1,417 | 1,122 | 1,015 |
Long-term debt | Outlook | ||||||||||
Standard & Poor's | |||||||||||
Long-term corporate credit | BBB+ | stable | |||||||||
Senior secured debt | A | stable | |||||||||
Senior unsecured debt | BBB+ | stable | |||||||||
Moody's | |||||||||||
Senior unsecured debt | Baa1 | stable | |||||||||
Commercial paper program | |||||||||||
Standard & Poor's | A-2 | N/A | |||||||||
Moody's | P-2 | N/A |
CPRC (Subsidiary Issuer) and CPRL (Parent Guarantor) | ||||||||
(in millions of Canadian dollars) | For the year ended December 31, 2020 | For the year ended December 31, 2019 | ||||||
Total revenues | $ | 5,797 | $ | 5,662 | ||||
Total operating expenses | 3,263 | 3,446 | ||||||
Operating Income (1) | 2,534 | 2,216 | ||||||
Less: Other (2) | 127 | (13) | ||||||
Income before income tax expense | 2,407 | 2,229 | ||||||
Net Income | $ | 1,792 | $ | 1,704 |
CPRC (Subsidiary Issuer) and CPRL (Parent Guarantor) | ||||||||
(in millions of Canadian dollars) | As at December 31, 2020 | As at December 31, 2019 | ||||||
Assets | ||||||||
Current Assets | $ | 907 | $ | 842 | ||||
Properties | 10,865 | 10,287 | ||||||
Other non-current assets | 1,151 | 1,208 | ||||||
Liabilities | ||||||||
Current liabilities | $ | 2,290 | $ | 1,833 | ||||
Long-term debt | 8,585 | 8,145 | ||||||
Other non-current liabilities | 2,981 | 2,711 |
CPRC (Subsidiary Issuer) and CPRL (Parent Guarantor) | ||||||||
(in millions of Canadian dollars) | For the year ended December 31, 2020 | For the year ended December 31, 2019 | ||||||
Dividend income from non-guarantor subsidiaries | $ | 163 | $ | 158 | ||||
Capital contributions to non-guarantor subsidiaries | — | (125) | ||||||
Return of capital from non-guarantor subsidiaries | 198 | 1,345 |
CPRC (Subsidiary Issuer) and CPRL (Parent Guarantor) | ||||||||
(in millions of Canadian dollars) | As at December 31, 2020 | As at December 31, 2019 | ||||||
Assets | ||||||||
Accounts Receivable, intercompany | $ | 327 | $ | 318 | ||||
Short-term advances to affiliates | 20 | 14 | ||||||
Long-term advances to affiliates | 9 | 7 | ||||||
Liabilities | ||||||||
Accounts payable, intercompany | $ | 179 | $ | 249 | ||||
Short-term advances from affiliates | 3,658 | 3,700 | ||||||
Long-term advances from affiliates | 82 | 84 |
For the year ended December 31 | |||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Net income as reported | $ | 2,444 | $ | 2,440 | $ | 1,951 | $ | 2,405 | $ | 1,599 | |||||||
Less significant items (pre-tax): | |||||||||||||||||
Legal settlement charge | — | — | — | — | (25) | ||||||||||||
Insurance recovery of legal settlement | — | — | — | 10 | — | ||||||||||||
Charge on hedge roll and de-designation | — | — | — | (13) | — | ||||||||||||
Management transition recovery | — | — | — | 51 | — | ||||||||||||
Impact of FX translation gain (loss) on debt and lease liabilities | 14 | 94 | (168) | 186 | 79 | ||||||||||||
Add: | |||||||||||||||||
Tax effect of adjustments(1) | 2 | 8 | (18) | 36 | 4 | ||||||||||||
Income tax rate changes | (29) | (88) | (21) | (541) | — | ||||||||||||
Provision for uncertain tax item | — | 24 | — | — | — | ||||||||||||
Adjusted income | $ | 2,403 | $ | 2,290 | $ | 2,080 | $ | 1,666 | $ | 1,549 | |||||||
For the year ended December 31 | |||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | |||||||||||||
Diluted earnings per share as reported | $ | 17.97 | $ | 17.52 | $ | 13.61 | $ | 16.44 | $ | 10.63 | |||||||
Less significant items (pre-tax): | |||||||||||||||||
Legal settlement charge | — | — | — | — | (0.17) | ||||||||||||
Insurance recovery of legal settlement | — | — | — | 0.07 | — | ||||||||||||
Charge on hedge roll and de-designation | — | — | — | (0.09) | — | ||||||||||||
Management transition recovery | — | — | — | 0.35 | — | ||||||||||||
Impact of FX translation gain (loss) on debt and lease liabilities | 0.10 | 0.67 | (1.17) | 1.27 | 0.53 | ||||||||||||
Add: | |||||||||||||||||
Tax effect of adjustments(1) | 0.01 | 0.05 | (0.12) | 0.25 | 0.02 | ||||||||||||
Income tax rate changes | (0.21) | (0.63) | (0.15) | (3.70) | — | ||||||||||||
Provision for uncertain tax item | — | 0.17 | — | — | — | ||||||||||||
Adjusted diluted earnings per share | $ | 17.67 | $ | 16.44 | $ | 14.51 | $ | 11.39 | $ | 10.29 | |||||||
For the year ended December 31 | |||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Operating income as reported | $ | 3,311 | $ | 3,124 | $ | 2,831 | $ | 2,519 | $ | 2,411 | |||||||
Less significant item: | |||||||||||||||||
Management transition recovery | — | — | — | 51 | — | ||||||||||||
Adjusted operating income | $ | 3,311 | $ | 3,124 | $ | 2,831 | $ | 2,468 | $ | 2,411 |
For the year ended December 31 | |||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | |||||||||||||
Operating ratio as reported | 57.1 | % | 59.9 | % | 61.3 | % | 61.6 | % | 61.3 | % | |||||||
Less significant item: | |||||||||||||||||
Management transition recovery | — | — | — | (0.8) | — | ||||||||||||
Adjusted operating ratio | 57.1 | % | 59.9 | % | 61.3 | % | 62.4 | % | 61.3 | % |
For the year ended December 31 | |||||||||||||||||
(in millions of Canadian dollars, except for percentages) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Net income as reported | $ | 2,444 | $ | 2,440 | $ | 1,951 | $ | 2,405 | $ | 1,599 | |||||||
Average shareholders' equity | $ | 7,194 | $ | 6,853 | $ | 6,537 | $ | 5,539 | $ | 4,711 | |||||||
Return on average shareholders' equity | 34.0 | % | 35.6�� | % | 29.8 | % | 43.4 | % | 33.9 | % |
For the year ended December 31 | |||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Net income as reported | $ | 2,444 | $ | 2,440 | $ | 1,951 | $ | 2,405 | $ | 1,599 | |||||||
Add: | |||||||||||||||||
Net interest expense | 458 | 448 | 453 | 473 | 471 | ||||||||||||
Tax on interest(1) | (113) | (112) | (112) | (126) | (124) | ||||||||||||
Significant items (pre-tax): | |||||||||||||||||
Legal settlement charge | — | — | — | — | 25 | ||||||||||||
Insurance recovery of legal settlement | — | — | — | (10) | — | ||||||||||||
Charge on hedge roll and de-designation | — | — | — | 13 | — | ||||||||||||
Management transition recovery | — | — | — | (51) | — | ||||||||||||
Impact of FX translation (gain) loss on debt and lease liabilities | (14) | (94) | 168 | (186) | (79) | ||||||||||||
Tax on significant items(2) | 2 | 8 | (18) | 36 | 4 | ||||||||||||
Income tax rate changes | (29) | (88) | (21) | (541) | — | ||||||||||||
Provision for uncertain tax item | — | 24 | — | — | — | ||||||||||||
Adjusted return | $ | 2,748 | $ | 2,626 | $ | 2,421 | $ | 2,013 | $ | 1,896 |
For the year ended December 31 | |||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Average shareholders' equity | $ | 7,194 | $ | 6,853 | $ | 6,537 | $ | 5,539 | $ | 4,711 | |||||||
Average Long-term debt, including long-term debt maturing within one year | 9,264 | 8,726 | 8,427 | 8,422 | 8,821 | ||||||||||||
$ | 16,458 | $ | 15,579 | $ | 14,964 | $ | 13,961 | $ | 13,532 | ||||||||
Less: | |||||||||||||||||
Significant items (pre-tax): | |||||||||||||||||
Legal settlement charge | — | — | — | — | (13) | ||||||||||||
Insurance recovery of legal settlement | — | — | — | 5 | — | ||||||||||||
Charge on hedge roll and de-designation | — | — | — | (7) | — | ||||||||||||
Management transition recovery | — | — | — | 26 | — | ||||||||||||
Tax on significant items(1) | — | — | — | (5) | 4 | ||||||||||||
Income tax rate changes | 15 | 44 | 11 | 270 | — | ||||||||||||
Provision for uncertain tax item | — | (12) | — | — | — | ||||||||||||
Adjusted average invested capital | $ | 16,443 | $ | 15,547 | $ | 14,953 | $ | 13,672 | $ | 13,541 |
For the year ended December 31 | |||||||||||||||||
(in millions of Canadian dollars, except for percentages) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Adjusted return | $ | 2,748 | $ | 2,626 | $ | 2,421 | $ | 2,013 | $ | 1,896 | |||||||
Adjusted average invested capital | $ | 16,443 | $ | 15,547 | $ | 14,953 | $ | 13,672 | $ | 13,541 | |||||||
Adjusted ROIC | 16.7 | % | 16.9 | % | 16.2 | % | 14.7 | % | 14.0 | % |
For the year ended December 31 | |||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Cash provided by operating activities | $ | 2,802 | $ | 2,990 | $ | 2,712 | $ | 2,182 | $ | 2,089 | |||||||
Cash used in investing activities | (2,030) | (1,803) | (1,458) | (1,295) | (1,069) | ||||||||||||
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents | 6 | (4) | 11 | (13) | (13) | ||||||||||||
Less: | |||||||||||||||||
Settlement of forward starting swaps on debt issuance | — | — | (24) | — | — | ||||||||||||
Investment in Central Maine & Québec Railway | 19 | (174) | — | — | — | ||||||||||||
Investment in Detroit River Tunnel Partnership | (398) | — | — | — | — | ||||||||||||
Free cash | $ | 1,157 | $ | 1,357 | $ | 1,289 | $ | 874 | $ | 1,007 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
(in millions of Canadian dollars) | Reported 2020 | Reported 2019 | Reported 2018 | Variance due to FX | FX Adjusted 2019 | FX Adj. % Change | Variance due to FX | FX Adjusted 2018 | FX Adj. % Change | |||||||||||||||||||||||
Freight revenues by line of business | ||||||||||||||||||||||||||||||||
Grain | $ | 1,829 | $ | 1,684 | $ | 1,566 | $ | 8 | $ | 1,692 | 8 | $ | 19 | $ | 1,585 | 6 | ||||||||||||||||
Coal | 566 | 682 | 673 | 1 | 683 | (17) | 2 | 675 | 1 | |||||||||||||||||||||||
Potash | 493 | 462 | 486 | 2 | 464 | 6 | 6 | 492 | (6) | |||||||||||||||||||||||
Fertilizers and sulphur | 290 | 250 | 243 | 2 | 252 | 15 | 4 | 247 | 1 | |||||||||||||||||||||||
Forest products | 328 | 304 | 284 | 3 | 307 | 7 | 5 | 289 | 5 | |||||||||||||||||||||||
Energy, chemicals and plastics | 1,519 | 1,534 | 1,243 | 3 | 1,537 | (1) | 17 | 1,260 | 22 | |||||||||||||||||||||||
Metals, minerals, and consumer products | 629 | 752 | 797 | 7 | 759 | (17) | 16 | 813 | (8) | |||||||||||||||||||||||
Automotive | 324 | 352 | 322 | 3 | 355 | (9) | 7 | 329 | 7 | |||||||||||||||||||||||
Intermodal | 1,563 | 1,593 | 1,538 | 4 | 1,597 | (2) | 10 | 1,548 | 3 | |||||||||||||||||||||||
Freight revenues | 7,541 | 7,613 | 7,152 | 33 | 7,646 | (1) | 86 | 7,238 | 5 | |||||||||||||||||||||||
Non-freight revenues | 169 | 179 | 164 | — | 179 | (6) | 1 | 165 | 8 | |||||||||||||||||||||||
Total revenues | $ | 7,710 | $ | 7,792 | $ | 7,316 | $ | 33 | $ | 7,825 | (1) | $ | 87 | $ | 7,403 | 5 |
2020 vs. 2019 | 2019 vs. 2018 | |||||||||||||||||||||||||||||||
(in millions of Canadian dollars) | Reported 2020 | Reported 2019 | Reported 2018 | Variance due to FX | FX Adjusted 2019 | FX Adj. % Change | Variance due to FX | FX Adjusted 2018 | FX Adj. % Change | |||||||||||||||||||||||
Compensation and benefits | $ | 1,560 | $ | 1,540 | $ | 1,468 | $ | 5 | $ | 1,545 | 1 | $ | 11 | $ | 1,479 | 4 | ||||||||||||||||
Fuel | 652 | 882 | 918 | 8 | 890 | (27) | 18 | 936 | (6) | |||||||||||||||||||||||
Materials | 216 | 210 | 201 | — | 210 | 3 | 1 | 202 | 4 | |||||||||||||||||||||||
Equipment rents | 142 | 137 | 130 | 2 | 139 | 2 | 3 | 133 | 3 | |||||||||||||||||||||||
Depreciation and amortization | 779 | 706 | 696 | 2 | 708 | 10 | 4 | 700 | 1 | |||||||||||||||||||||||
Purchased services and other | 1,050 | 1,193 | 1,072 | 6 | 1,199 | (12) | 11 | 1,083 | 10 | |||||||||||||||||||||||
Total operating expenses | $ | 4,399 | $ | 4,668 | $ | 4,485 | $ | 23 | $ | 4,691 | (6) | $ | 48 | $ | 4,533 | 3 |
For the year ended December 31 | |||||||||||||||||
(in dollars, except for percentages) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Dividends declared per share | $ | 3.5600 | $ | 3.1400 | $ | 2.5125 | $ | 2.1875 | $ | 1.8500 | |||||||
Diluted EPS | 17.97 | 17.52 | 13.61 | 16.44 | 10.63 | ||||||||||||
Dividend payout ratio | 19.8 | % | 17.9 | % | 18.5 | % | 13.3 | % | 17.4 | % |
For the year ended December 31 | |||||||||||||||||
(in dollars, except for percentages) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Dividends declared per share | $ | 3.5600 | $ | 3.1400 | $ | 2.5125 | $ | 2.1875 | $ | 1.8500 | |||||||
Adjusted diluted EPS | 17.67 | 16.44 | 14.51 | 11.39 | 10.29 | ||||||||||||
Adjusted dividend payout ratio | 20.1 | % | 19.1 | % | 17.3 | % | 19.2 | % | 18.0 | % |
(in millions of Canadian dollars, except for ratios) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Long-term debt including long-term debt maturing within one year as at December 31 | $ | 9,771 | $ | 8,757 | $ | 8,696 | $ | 8,159 | $ | 8,684 | |||||||
Net income for the year ended December 31 | 2,444 | 2,440 | 1,951 | 2,405 | 1,599 | ||||||||||||
Long-term debt to Net income ratio | 4.0 | 3.6 | 4.5 | 3.4 | 5.4 |
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Long-term debt including long-term debt maturing within one year as at December 31 | $ | 9,771 | $ | 8,757 | $ | 8,696 | $ | 8,159 | $ | 8,684 | |||||||
Add: | |||||||||||||||||
Pension plans deficit(1) | 328 | 294 | 266 | 278 | 273 | ||||||||||||
Operating lease liabilities | 311 | 354 | 387 | 281 | 361 | ||||||||||||
Less: | |||||||||||||||||
Cash and cash equivalents | 147 | 133 | 61 | 338 | 164 | ||||||||||||
Adjusted net debt as at December 31 | $ | 10,263 | $ | 9,272 | $ | 9,288 | $ | 8,380 | $ | 9,154 |
For the year ended December 31 | |||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Net income as reported | $ | 2,444 | $ | 2,440 | $ | 1,951 | $ | 2,405 | $ | 1,599 | |||||||
Add: | |||||||||||||||||
Net interest expense | 458 | 448 | 453 | 473 | 471 | ||||||||||||
Income tax expense | 758 | 706 | 637 | 93 | 553 | ||||||||||||
EBIT | 3,660 | 3,594 | 3,041 | 2,971 | 2,623 | ||||||||||||
Less significant items (pre-tax): | |||||||||||||||||
Legal settlement charge | — | — | — | — | (25) | ||||||||||||
Insurance recovery of legal settlement | — | — | — | 10 | — | ||||||||||||
Charge on hedge roll and de-designation | — | — | — | (13) | — | ||||||||||||
Management transition recovery | — | — | — | 51 | — | ||||||||||||
Impact of FX translation gain (loss) on debt and lease liabilities | 14 | 94 | (168) | 186 | 79 | ||||||||||||
Adjusted EBIT | 3,646 | 3,500 | 3,209 | 2,737 | 2,569 | ||||||||||||
Add: | |||||||||||||||||
Operating lease expense | 78 | 83 | 97 | 104 | 111 | ||||||||||||
Depreciation and amortization | 779 | 706 | 696 | 661 | 640 | ||||||||||||
Less: | |||||||||||||||||
Other components of net periodic benefit recovery | 342 | 381 | 384 | 274 | 167 | ||||||||||||
Adjusted EBITDA | $ | 4,161 | $ | 3,908 | $ | 3,618 | $ | 3,228 | $ | 3,153 |
(in millions of Canadian dollars, except for ratios) | 2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||
Adjusted net debt as at December 31 | $ | 10,263 | $ | 9,272 | $ | 9,288 | $ | 8,380 | $ | 9,154 | |||||||
Adjusted EBITDA for the year ended December 31 | 4,161 | 3,908 | 3,618 | 3,228 | 3,153 | ||||||||||||
Adjusted net debt to Adjusted EBITDA ratio | 2.5 | 2.4 | 2.6 | 2.6 | 2.9 |
Payments due by period (in millions of Canadian dollars) | Total | 2021 | 2022 & 2023 | 2024 & 2025 | Thereafter | ||||||||||||
Interest on long-term debt and finance leases | $ | 10,883 | $ | 441 | $ | 762 | $ | 693 | $ | 8,987 | |||||||
Long-term debt | 9,717 | 1,178 | 946 | 974 | 6,619 | ||||||||||||
Finance leases | 143 | 8 | 111 | 14 | 10 | ||||||||||||
Operating leases(1) | 347 | 71 | 112 | 76 | 88 | ||||||||||||
Supplier purchase | 1,743 | 528 | 930 | 97 | 188 | ||||||||||||
Other long-term liabilities(2) | 494 | 54 | 102 | 98 | 240 | ||||||||||||
Total contractual commitments | $ | 23,327 | $ | 2,280 | $ | 2,963 | $ | 1,952 | $ | 16,132 |
Payments due by period (in millions of Canadian dollars) | Total | 2021 | 2022 & 2023 | 2024 & 2025 | Thereafter | ||||||||||||
Letters of credit | $ | 59 | $ | 59 | $ | — | $ | — | $ | — | |||||||
Capital commitments | 547 | 369 | 79 | 41 | 58 | ||||||||||||
Total certain other financial commitments | $ | 606 | $ | 428 | $ | 79 | $ | 41 | $ | 58 |
2020 | 2019 | ||||||||||||||||||||||
(in millions of Canadian dollars) | Current service cost | Other components | Total | Current service cost | Other components | Total | |||||||||||||||||
Defined benefit pensions | $ | 140 | $ | (363) | $ | (223) | $ | 107 | $ | (414) | $ | (307) | |||||||||||
Defined contribution pensions | 12 | — | 12 | 11 | — | 11 | |||||||||||||||||
Post-retirement benefits | 4 | 17 | 21 | 4 | 16 | 20 | |||||||||||||||||
Self-insured workers' compensation and long-term disability benefits | 8 | 4 | 12 | 7 | 17 | 24 | |||||||||||||||||
All plans | $ | 164 | $ | (342) | $ | (178) | $ | 129 | $ | (381) | $ | (252) |
Key Assumptions | Assessments | ||||
•Whole and remaining asset lives | •Statistical analysis of historical retirement patterns; •Evaluation of management strategy and its impact on operations and the future use of specific property assets; •Assessment of technological advances; •Engineering estimates of changes in current operations and analysis of historic, current and projected future usage; •Additional factors considered for track assets: density of traffic and whether rail is new or has been re-laid in a subsequent position; •Assessment of policies and practices for the management of assets including maintenance; and •Comparison with industry data. | ||||
•Salvage values | •Analysis of historical, current and estimated future salvage values. |
Page | |||||
Report of Independent Registered Public Accounting Firm | |||||
Consolidated Statements of Income | |||||
For the Year Ended December 31, 2020, 2019, and 2018 | |||||
Consolidated Statements of Comprehensive Income | |||||
For the Year Ended December 31, 2020, 2019, and 2018 | |||||
Consolidated Balance Sheets | |||||
As at December 31, 2020 and 2019 | |||||
Consolidated Statements of Cash Flows | |||||
For the Year Ended December 31, 2020, 2019, and 2018 | |||||
Consolidated Statements of Changes in Shareholders' Equity | |||||
For the Year Ended December 31, 2020, 2019, and 2018 | |||||
Notes to Consolidated Financial Statements |
Year ended December 31 (in millions of Canadian dollars, except share and per share data) | 2020 | 2019 | 2018 | ||||||||
Revenues (Note 3) | |||||||||||
Freight | $ | 7,541 | $ | 7,613 | $ | 7,152 | |||||
Non-freight | 169 | 179 | 164 | ||||||||
Total revenues | 7,710 | 7,792 | 7,316 | ||||||||
Operating expenses | |||||||||||
Compensation and benefits (Note 22, 23) | 1,560 | 1,540 | 1,468 | ||||||||
Fuel | 652 | 882 | 918 | ||||||||
Materials | 216 | 210 | 201 | ||||||||
Equipment rents | 142 | 137 | 130 | ||||||||
Depreciation and amortization | 779 | 706 | 696 | ||||||||
Purchased services and other (Note 10) | 1,050 | 1,193 | 1,072 | ||||||||
Total operating expenses | 4,399 | 4,668 | 4,485 | ||||||||
Operating income | 3,311 | 3,124 | 2,831 | ||||||||
Less: | |||||||||||
Other (income) expense (Note 4) | (7) | (89) | 174 | ||||||||
Other components of net periodic benefit recovery (Note 22) | (342) | (381) | (384) | ||||||||
Net interest expense (Note 5) | 458 | 448 | 453 | ||||||||
Income before income tax expense | 3,202 | 3,146 | 2,588 | ||||||||
Income tax expense (Note 6) | 758 | 706 | 637 | ||||||||
Net income | $ | 2,444 | $ | 2,440 | $ | 1,951 | |||||
Earnings per share (Note 7) | |||||||||||
Basic earnings per share | $ | 18.05 | $ | 17.58 | $ | 13.65 | |||||
Diluted earnings per share | $ | 17.97 | $ | 17.52 | $ | 13.61 | |||||
Weighted-average number of shares (millions) (Note 7) | |||||||||||
Basic | 135.5 | 138.8 | 142.9 | ||||||||
Diluted | 136.0 | 139.3 | 143.3 |
Year ended December 31 (in millions of Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
Net income | $ | 2,444 | $ | 2,440 | $ | 1,951 | |||||
Net gain (loss) in foreign currency translation adjustments, net of hedging activities | 18 | 37 | (60) | ||||||||
Change in derivatives designated as cash flow hedges | 9 | 10 | 38 | ||||||||
Change in pension and post-retirement defined benefit plans | (407) | (661) | (449) | ||||||||
Other comprehensive loss before income taxes | (380) | (614) | (471) | ||||||||
Income tax recovery on above items | 88 | 135 | 169 | ||||||||
Other comprehensive loss (Note 8) | (292) | (479) | (302) | ||||||||
Comprehensive income | $ | 2,152 | $ | 1,961 | $ | 1,649 |
As at December 31 (in millions of Canadian dollars, except Common Shares) | 2020 | 2019 | ||||||
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 147 | $ | 133 | ||||
Accounts receivable, net (Note 9) | 825 | 805 | ||||||
Materials and supplies | 208 | 182 | ||||||
Other current assets | 141 | 90 | ||||||
1,321 | 1,210 | |||||||
Investments (Note 11) | 199 | 341 | ||||||
Properties (Note 12, 19) | 20,422 | 19,156 | ||||||
Goodwill and intangible assets (Note 10, 13) | 366 | 206 | ||||||
Pension asset (Note 22) | 894 | 1,003 | ||||||
Other assets (Note 14, 19) | 438 | 451 | ||||||
Total assets | $ | 23,640 | $ | 22,367 | ||||
Liabilities and shareholders’ equity | ||||||||
Current liabilities | ||||||||
Accounts payable and accrued liabilities (Note 15, 19) | $ | 1,467 | $ | 1,693 | ||||
Long-term debt maturing within one year (Note 16, 17, 19) | 1,186 | 599 | ||||||
2,653 | 2,292 | |||||||
Pension and other benefit liabilities (Note 22) | 832 | 785 | ||||||
Other long-term liabilities (Note 18, 19) | 585 | 562 | ||||||
Long-term debt (Note 16, 17, 19) | 8,585 | 8,158 | ||||||
Deferred income taxes (Note 6) | 3,666 | 3,501 | ||||||
Total liabilities | 16,321 | 15,298 | ||||||
Shareholders’ equity | ||||||||
Share capital (Note 20) Authorized unlimited Common Shares without par value. Issued and outstanding are 133.3 million and 137.0 million as at December 31, 2020 and 2019, respectively. | 1,983 | 1,993 | ||||||
Authorized unlimited number of first and second preferred shares; none outstanding. | ||||||||
Additional paid-in capital | 55 | 48 | ||||||
Accumulated other comprehensive loss (Note 8) | (2,814) | (2,522) | ||||||
Retained earnings | 8,095 | 7,550 | ||||||
7,319 | 7,069 | |||||||
Total liabilities and shareholders’ equity | $ | 23,640 | $ | 22,367 |
Approved on behalf of the Board: | ||||||||||||||||||||||||||
/s/ ISABELLE COURVILLE | /s/ JANE L. PEVERETT | |||||||||||||||||||||||||
Isabelle Courville, Director, | Jane L. Peverett, Director, | |||||||||||||||||||||||||
Chair of the Board | Chair of the Audit and Finance Committee |
Year ended December 31 (in millions of Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
Operating activities | |||||||||||
Net income | $ | 2,444 | $ | 2,440 | $ | 1,951 | |||||
Reconciliation of net income to cash provided by operating activities: | |||||||||||
Depreciation and amortization | 779 | 706 | 696 | ||||||||
Deferred income tax expense (Note 6) | 221 | 181 | 256 | ||||||||
Pension recovery and funding (Note 22) | (250) | (360) | (321) | ||||||||
Foreign exchange (gain) loss on debt and lease liabilities (Note 4) | (14) | (94) | 168 | ||||||||
Settlement of forward starting swaps on debt issuance (Note 17) | 0 | 0 | (24) | ||||||||
Other operating activities, net | 11 | 143 | (79) | ||||||||
Change in non-cash working capital balances related to operations (Note 21) | (389) | (26) | 65 | ||||||||
Cash provided by operating activities | 2,802 | 2,990 | 2,712 | ||||||||
Investing activities | |||||||||||
Additions to properties | (1,671) | (1,647) | (1,551) | ||||||||
Investment in Detroit River Tunnel Partnership (Note 10) | (398) | 0 | 0 | ||||||||
Investment in Central Maine & Québec Railway (Note 10) | 19 | (174) | 0 | ||||||||
Proceeds from sale of properties and other assets | 22 | 26 | 78 | ||||||||
Other | (2) | (8) | 15 | ||||||||
Cash used in investing activities | (2,030) | (1,803) | (1,458) | ||||||||
Financing activities | |||||||||||
Dividends paid | (467) | (412) | (348) | ||||||||
Issuance of CP Common Shares (Note 23) | 52 | 26 | 24 | ||||||||
Purchase of CP Common shares (Note 20) | (1,509) | (1,134) | (1,103) | ||||||||
Issuance of long-term debt, excluding commercial paper (Note 16) | 958 | 397 | 638 | ||||||||
Repayment of long-term debt, excluding commercial paper (Note 16) | (84) | (500) | (753) | ||||||||
Net issuance of commercial paper (Note 16) | 270 | 524 | 0 | ||||||||
Net increase in short-term borrowings (Note 16) | 5 | 0 | 0 | ||||||||
Other | 11 | (12) | 0 | ||||||||
Cash used in financing activities | (764) | (1,111) | (1,542) | ||||||||
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents | 6 | (4) | 11 | ||||||||
Cash position | |||||||||||
Increase (decrease) in cash and cash equivalents | 14 | 72 | (277) | ||||||||
Cash and cash equivalents at beginning of year | 133 | 61 | 338 | ||||||||
Cash and cash equivalents at end of year | $ | 147 | $ | 133 | $ | 61 | |||||
Supplemental disclosures of cash flow information: | |||||||||||
Income taxes paid | $ | 582 | $ | 506 | $ | 318 | |||||
Interest paid | $ | 443 | $ | 444 | $ | 463 |
(in millions of Canadian dollars, except per share data) | Share capital | Additional paid-in capital | Accumulated other comprehensive loss | Retained earnings | Total shareholders’ equity | ||||||||||||
Balance at December 31, 2017 | $ | 2,032 | $ | 43 | $ | (1,741) | $ | 6,103 | $ | 6,437 | |||||||
Net income | 0 | 0 | 0 | 1,951 | 1,951 | ||||||||||||
Other comprehensive loss (Note 8) | 0 | 0 | (302) | 0 | (302) | ||||||||||||
Dividends declared ($2.5125 per share) | 0 | 0 | 0 | (358) | (358) | ||||||||||||
Effect of stock-based compensation expense | 0 | 11 | 0 | 0 | 11 | ||||||||||||
CP Common Shares repurchased (Note 20) | (66) | 0 | 0 | (1,061) | (1,127) | ||||||||||||
Shares issued under stock option plan (Note 20) | 36 | (12) | 0 | 0 | 24 | ||||||||||||
Balance at December 31, 2018 | 2,002 | 42 | (2,043) | 6,635 | 6,636 | ||||||||||||
Impact of accounting change | — | — | — | (5) | (5) | ||||||||||||
Balance at January 1, 2019, as restated | 2,002 | 42 | (2,043) | 6,630 | 6,631 | ||||||||||||
Net income | 0 | 0 | 0 | 2,440 | 2,440 | ||||||||||||
Other comprehensive loss (Note 8) | 0 | 0 | (479) | 0 | (479) | ||||||||||||
Dividends declared ($3.1400 per share) | 0 | 0 | 0 | (434) | (434) | ||||||||||||
Effect of stock-based compensation expense | 0 | 15 | 0 | 0 | 15 | ||||||||||||
CP Common Shares repurchased (Note 20) | (54) | 0 | 0 | (1,086) | (1,140) | ||||||||||||
Shares issued under stock option plan (Note 20) | 45 | (9) | 0 | 0 | 36 | ||||||||||||
Balance at December 31, 2019 | 1,993 | 48 | (2,522) | 7,550 | 7,069 | ||||||||||||
Impact of accounting change (Note 2) | — | — | — | (1) | (1) | ||||||||||||
Balance at January 1, 2020, as restated | 1,993 | 48 | (2,522) | 7,549 | 7,068 | ||||||||||||
Net income | 0 | 0 | 0 | 2,444 | 2,444 | ||||||||||||
Other comprehensive loss (Note 8) | 0 | 0 | (292) | 0 | (292) | ||||||||||||
Dividends declared ($3.5600 per share) | 0 | 0 | 0 | (479) | (479) | ||||||||||||
Effect of stock-based compensation expense | 0 | 17 | 0 | 0 | 17 | ||||||||||||
CP Common Shares repurchased (Note 20) | (58) | 0 | 0 | (1,419) | (1,477) | ||||||||||||
Shares issued under stock option plan (Note 20) | 48 | (10) | 0 | 0 | 38 | ||||||||||||
Balance at December 31, 2020 | $ | 1,983 | $ | 55 | $ | (2,814) | $ | 8,095 | $ | 7,319 |
Assumptions | Willis Towers Watson expected life binomial valuation | |||||||||
NYSE | TSX | |||||||||
Option Term | 7 years | 7 years | ||||||||
Vesting Schedule | 4 year pro-rated | 4 year pro-rated | ||||||||
Expected Life | 4.75 years | 4.75 years | ||||||||
Dividend Yield (1-year historical) | 1.00% | 0.99% | ||||||||
Volatility (3-year daily) | 24.0% | 21.7% | ||||||||
Risk-free Rate (yield curve) | 2.5 - 3.1% | 2.0 - 2.5% | ||||||||
Risk of Forfeiture | 5% | 5% | ||||||||
Stock Option Value (as a % of grant price) | 23% | 20% |
Perquisites | Other compensation | |||||||||||||||||||||||||||||||||||||||
Name | Personal use of company aircraft ($) | Auto benefits ($) | Housing allowance ($) | Financial and tax planning ($) | Additional medical ($) | Club benefits ($) | 401K match ($) | Employer share purchase plan match ($) | Tax Assistance ($) | Total ($) | ||||||||||||||||||||||||||||||
Keith Creel | | 413,422 | | | 28,704 | | | 17,056 | | | 33,173 | | | 1,353 | | | 23,647 | | | 7,165 | | | 30,410 | | | - | | | 554,930 | | ||||||||||
Nadeem Velani | | - | | | 33,177 | | | - | | | - | | | - | | | 11,200 | | | - | | | 14,872 | | | - | | | 59,249 | | ||||||||||
John Brooks | | - | | | 26,251 | | | - | | | - | | | 2,610 | | | 14,861 | | | 9,658 | | | 13,271 | | | - | | | 66,651 | | ||||||||||
Laird Pitz | | - | | | 22,543 | | | - | | | - | | | - | | | 14,861 | | | 8,203 | | | - | | | - | | | 45,607 | | ||||||||||
Mark Redd | | - | | | 36,594 | | | - | | | - | | | 2,510 | | | 14,861 | | | 7,626 | | | 9,728 | | | 143,305 | | | 214,624 | | ||||||||||
Robert Johnson | | - | | | 53,148 | | | - | | | - | | | - | | | 14,861 | | | 9,616 | | | 1,949 | | | - | | | 79,574 | |
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
Freight | |||||||||||
Grain | $ | 1,829 | $ | 1,684 | $ | 1,566 | |||||
Coal | 566 | 682 | 673 | ||||||||
Potash | 493 | 462 | 486 | ||||||||
Fertilizers and sulphur | 290 | 250 | 243 | ||||||||
Forest products | 328 | 304 | 284 | ||||||||
Energy, chemicals and plastics | 1,519 | 1,534 | 1,243 | ||||||||
Metals, minerals and consumer products | 629 | 752 | 797 | ||||||||
Automotive | 324 | 352 | 322 | ||||||||
Intermodal | 1,563 | 1,593 | 1,538 | ||||||||
Total freight revenues | 7,541 | 7,613 | 7,152 | ||||||||
Non-freight excluding leasing revenues | 107 | 116 | 102 | ||||||||
Revenues from contracts with customers | 7,648 | 7,729 | 7,254 | ||||||||
Leasing revenues | 62 | 63 | 62 | ||||||||
Total revenues | $ | 7,710 | $ | 7,792 | $ | 7,316 |
Option-based awards | Share-based awards | |||||||||||||||||||||||||||||||||
Name | Grant date | Number of securities underlying unexercised options (#) | Option exercise price ($) | Option expiration date | Value of unexercised in-the-money options ($) | Grant type | Number of shares or units of shares that have not vested (#) | Market or payout value of share-based awards that have not vested ($) | Market or payout value of vested share-based awards not paid out or distributed ($) | |||||||||||||||||||||||||
Keith Creel | 31-Jan-2014 | 39,900 | 168.84 | 31-Jan-2024 | 6,471,381 | |||||||||||||||||||||||||||||
24-Jul-2014 | 47,940 | 210.32 | 24-Jul-2024 | 5,786,837 | ||||||||||||||||||||||||||||||
23-Jan-2015 | 33,910 | 175.92 | 23-Jan-2025 | 3,480,664 | ||||||||||||||||||||||||||||||
22-Jan-2016 | 55,250 | 116.80 | 22-Jan-2026 | 9,913,464 | ||||||||||||||||||||||||||||||
20-Jan-2017 | 33,884 | 150.99 | 20-Jan-2024 | 4,575,128 | ||||||||||||||||||||||||||||||
1-Feb-2017 | 18,762 | 151.14 | 1-Feb-2024 | 2,529,651 | ||||||||||||||||||||||||||||||
1-Feb-2017 | 177,225 | 151.14 | 1-Feb-2024 | 23,894,968 | ||||||||||||||||||||||||||||||
22-Jan-2018 | 43,148 | 185.85 | 22-Jan-2025 | 3,872,407 | ||||||||||||||||||||||||||||||
25-Jan-2019 | 54,202 | 205.31 | 25-Jan-2026 | 3,494,535 | ||||||||||||||||||||||||||||||
6-Feb-2013 | DSU | 10,546,127 | ||||||||||||||||||||||||||||||||
21-Feb-2017 | PSU | 14,138,889 | ||||||||||||||||||||||||||||||||
15-Feb-2018 | PSU | 18,621 | 6,166,051 | |||||||||||||||||||||||||||||||
14-Feb-2019 | PSU | 22,068 | 7,307,316 | |||||||||||||||||||||||||||||||
Total | 504,221 | 64,019,035 | 40,689 | 13,473,367 | 24,685,016 | |||||||||||||||||||||||||||||
Nadeem Velani | 2-Apr-2013 | 2,310 | 126.34 | 2-Apr-2023 | 472,834 | |||||||||||||||||||||||||||||
31-Jan-2014 | 1,820 | 168.84 | 31-Jan-2024 | 295,186 | ||||||||||||||||||||||||||||||
23-Jan-2015 | 1,539 | 218.78 | 23-Jan-2025 | 172,753 | ||||||||||||||||||||||||||||||
22-Jan-2016 | 2,927 | 165.74 | 22-Jan-2026 | 483,804 | ||||||||||||||||||||||||||||||
20-Jan-2017 | 4,644 | 201.49 | 20-Jan-2024 | 601,584 | ||||||||||||||||||||||||||||||
22-Jan-2018 | 13,260 | 231.66 | 22-Jan-2025 | 1,317,646 | ||||||||||||||||||||||||||||||
25-Jan-2019 | 16,313 | 271.50 | 25-Jan-2026 | 971,113 | ||||||||||||||||||||||||||||||
26-Feb-2014 | DSU | 223,781 | ||||||||||||||||||||||||||||||||
19-Feb-2015 | DSU | 113,220 | ||||||||||||||||||||||||||||||||
24-Feb-2017 | DSU | 124 | 41,083 | 164,332 | ||||||||||||||||||||||||||||||
22-Feb-2019 | DSU | 270 | 89,402 | 357,609 | ||||||||||||||||||||||||||||||
21-Feb-2017 | PSU | 2,517,052 | ||||||||||||||||||||||||||||||||
15-Feb-2018 | PSU | 5,304 | 1,755,752 | |||||||||||||||||||||||||||||||
14-Feb-2019 | PSU | 5,832 | 1,930,622 | |||||||||||||||||||||||||||||||
Total | 42,813 | 4,314,920 | 11,530 | 3,816,859 | 3,375,994 | |||||||||||||||||||||||||||||
John Brooks | 1-Apr-2012 | 2,850 | 75.71 | 1-Apr-2022 | 727,662 | |||||||||||||||||||||||||||||
7-Dec-2012 | 2,345 | 97.70 | 7-Dec-2022 | 547,159 | ||||||||||||||||||||||||||||||
22-Feb-2013 | 1,900 | 119.18 | 22-Feb-2023 | 402,515 | ||||||||||||||||||||||||||||||
31-Jan-2014 | 1,440 | 168.84 | 31-Jan-2024 | 233,554 | ||||||||||||||||||||||||||||||
23-Jan-2015 | 2,506 | 175.92 | 23-Jan-2025 | 257,226 | ||||||||||||||||||||||||||||||
22-Jan-2016 | 4,340 | 116.80 | 22-Jan-2026 | 778,723 | ||||||||||||||||||||||||||||||
20-Jan-2017 | 2,610 | 150.99 | 20-Jan-2024 | 352,411 | ||||||||||||||||||||||||||||||
22-Jan-2018 | 4,195 | 185.85 | 22-Jan-2025 | 376,489 | ||||||||||||||||||||||||||||||
25-Jan-2019 | 7,484 | 205.31 | 25-Jan-2026 | 482,512 | ||||||||||||||||||||||||||||||
14-Feb-2019 | 2,969 | 202.00 | 14-Feb-2026 | 204,182 | ||||||||||||||||||||||||||||||
6-Sep-2012 | DSU | 334,073 | ||||||||||||||||||||||||||||||||
22-Feb-2019 | DSU | 166 | 54,816 | 219,265 | ||||||||||||||||||||||||||||||
21-Feb-2017 | PSU | 1,374,360 | ||||||||||||||||||||||||||||||||
15-Feb-2018 | PSU | 1,810 | 599,421 | |||||||||||||||||||||||||||||||
14-Feb-2019 | PSU | 4,499 | 1,489,757 | |||||||||||||||||||||||||||||||
Total | 32,639 | 4,362,433 | 6,475 | 2,143,994 | 1,927,698 | |||||||||||||||||||||||||||||
Laird Pitz | 22-Jan-2016 | 1,808 | 116.80 | 22-Jan-2026 | 324,408 | |||||||||||||||||||||||||||||
20-Jan-2017 | 2,376 | 150.99 | 20-Jan-2024 | 320,815 | ||||||||||||||||||||||||||||||
22-Jan-2018 | 3,290 | 185.85 | 22-Jan-2025 | 295,268 | ||||||||||||||||||||||||||||||
25-Jan-2019 | 7,484 | 205.31 | 25-Jan-2026 | 482,512 | ||||||||||||||||||||||||||||||
19-Feb-2015 | DSU | 592,133 | ||||||||||||||||||||||||||||||||
23-Feb-2016 | DSU | 876,230 | ||||||||||||||||||||||||||||||||
21-Feb-2017 | PSU | 1,264,578 | ||||||||||||||||||||||||||||||||
15-Feb-2018 | PSU | 1,893 | 626,713 | |||||||||||||||||||||||||||||||
14-Feb-2019 | PSU | 3,047 | 1,008,964 | |||||||||||||||||||||||||||||||
Total | 14,958 | 1,423,003 | 4,940 | 1,635,677 | 2,732,941 |
Option-based awards | Share-based awards | |||||||||||||||||||||||||||||||||
Name | Grant date | Number of securities underlying unexercised options (#) | Option exercise price ($) | Option expiration date | Value of unexercised in-the-money options ($) | Grant type | Number of shares or units of shares that have not vested (#) | Market or payout value of share-based awards that have not vested ($) | Market or payout value of vested share-based awards not paid out or distributed ($) | |||||||||||||||||||||||||
Mark Redd | 1-Apr-2014 | 1,380 | 166.16 | 1-Apr-2024 | 227,521 | |||||||||||||||||||||||||||||
23-Jan-2015 | 1,256 | 175.92 | 23-Jan-2025 | 128,921 | ||||||||||||||||||||||||||||||
22-Jan-2016 | 2,042 | 116.80 | 22-Jan-2026 | 366,394 | ||||||||||||||||||||||||||||||
20-Jan-2017 | 3,734 | 150.99 | 20-Jan-2024 | 504,177 | ||||||||||||||||||||||||||||||
22-Jan-2018 | 4,015 | 185.85 | 22-Jan-2025 | 360,335 | ||||||||||||||||||||||||||||||
20-Jul-2018 | 5,280 | 194.97 | 20-Jul-2025 | 411,323 | ||||||||||||||||||||||||||||||
25-Jan-2019 | 3,996 | 205.31 | 25-Jan-2026 | 257,632 | ||||||||||||||||||||||||||||||
3-Sep-2019 | 1,297 | 234.76 | 3-Sep-2026 | 34,011 | ||||||||||||||||||||||||||||||
19-Feb-2015 | DSU | 144,884 | ||||||||||||||||||||||||||||||||
22-Feb-2019 | DSU | 140 | 46,499 | 185,998 | ||||||||||||||||||||||||||||||
21-Feb-2017 | PSU | 1,178,305 | ||||||||||||||||||||||||||||||||
15-Feb-2018 | PSU | 1,733 | 573,813 | |||||||||||||||||||||||||||||||
20-Jul-2018 | PSU | 1,708 | 565,642 | |||||||||||||||||||||||||||||||
14-Feb-2019 | PSU | 1,627 | 538,848 | |||||||||||||||||||||||||||||||
3-Sep-2019 | PSU | 554 | 183,289 | |||||||||||||||||||||||||||||||
Total | 23,000 | 2,290,314 | 5,762 | 1,908,091 | 1,509,187 | |||||||||||||||||||||||||||||
Robert Johnson | 22-Jan-2016 | 2,061 | 116.80 | 22-Jan-2026 | 369,804 | |||||||||||||||||||||||||||||
20-Jan-2017 | 5,778 | 150.99 | 20-Jan-2024 | 780,164 | ||||||||||||||||||||||||||||||
22-Jan-2018 | 7,038 | 185.85 | 22-Jan-2025 | 631,640 | ||||||||||||||||||||||||||||||
25-Jan-2019 | 9,367 | 205.31 | 25-Jan-2026 | 603,913 | ||||||||||||||||||||||||||||||
24-Jun-2013 | DSU | 1,879,575 | ||||||||||||||||||||||||||||||||
27-Feb-2018 | DSU | 213,756 | ||||||||||||||||||||||||||||||||
21-Feb-2017 | PSU | 3,075,226 | ||||||||||||||||||||||||||||||||
15-Feb-2018 | PSU | 4,050 | 1,341,032 | |||||||||||||||||||||||||||||||
14-Feb-2019 | PSU | 3,814 | 1,262,873 | |||||||||||||||||||||||||||||||
Total | 24,244 | 2,385,521 | 7,864 | 2,603,905 | 5,168,557 |
(in millions of Canadian dollars) | 2020 | 2019 | |||||||||
Opening balance | $ | 146 | $ | 2 | |||||||
Revenue recognized that was included in the contract liability balance at the beginning of the period | (100) | (2) | |||||||||
Increase due to consideration received, net of revenue recognized during the period | 15 | 146 | |||||||||
Closing balance | $ | 61 | $ | 146 |
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
Foreign exchange (gain) loss on debt and lease liabilities | $ | (14) | $ | (94) | $ | 168 | |||||
Other foreign exchange (gains) losses | (1) | (4) | 3 | ||||||||
Other | 8 | 9 | 3 | ||||||||
Other (income) expense | $ | (7) | $ | (89) | $ | 174 |
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
Interest cost | $ | 478 | $ | 471 | $ | 475 | |||||
Interest capitalized to Properties | (16) | (17) | (20) | ||||||||
Interest expense | 462 | 454 | 455 | ||||||||
Interest income | (4) | (6) | (2) | ||||||||
Net interest expense | $ | 458 | $ | 448 | $ | 453 |
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
Current income tax expense | $ | 537 | $ | 525 | $ | 381 | |||||
Deferred income tax expense | |||||||||||
Origination and reversal of temporary differences | 277 | 316 | 214 | ||||||||
Effect of tax rate decrease | (32) | (95) | (21) | ||||||||
Effect of hedge of net investment in foreign subsidiaries | (18) | (38) | 64 | ||||||||
Other | (6) | (2) | (1) | ||||||||
Total deferred income tax expense | 221 | 181 | 256 | ||||||||
Total income taxes | $ | 758 | $ | 706 | $ | 637 | |||||
Income before income tax expense | |||||||||||
Canada | $ | 2,518 | $ | 2,392 | $ | 1,788 | |||||
Foreign | 684 | 754 | 800 | ||||||||
Total income before income tax expense | $ | 3,202 | $ | 3,146 | $ | 2,588 | |||||
Income tax expense | |||||||||||
Current | |||||||||||
Canada | $ | 412 | $ | 410 | $ | 336 | |||||
Foreign | 125 | 115 | 45 | ||||||||
Total current income tax expense | 537 | 525 | 381 | ||||||||
Deferred | |||||||||||
Canada | 231 | 141 | 174 | ||||||||
Foreign | (10) | 40 | 82 | ||||||||
Total deferred income tax expense | 221 | 181 | 256 | ||||||||
Total income taxes | $ | 758 | $ | 706 | $ | 637 |
(in millions of Canadian dollars) | 2020 | 2019 | ||||||
Deferred income tax assets | ||||||||
Amount related to tax losses carried forward | $ | 17 | $ | 6 | ||||
Liabilities carrying value in excess of tax basis | 131 | 139 | ||||||
Unrealized foreign exchange losses | 4 | 26 | ||||||
Environmental remediation costs | 22 | 22 | ||||||
Other | 4 | 4 | ||||||
Total net deferred income tax assets | 178 | 197 | ||||||
Deferred income tax liabilities | ||||||||
Properties carrying value in excess of tax basis | 3,708 | 3,524 | ||||||
Pensions carrying value in excess of tax basis | 43 | 83 | ||||||
Other | 93 | 91 | ||||||
Total deferred income tax liabilities | 3,844 | 3,698 | ||||||
Total net deferred income tax liabilities | $ | 3,666 | $ | 3,501 |
(in millions of Canadian dollars, except percentage) | 2020 | 2019 | 2018 | ||||||||
Statutory federal and provincial income tax rate (Canada) | 26.31 | % | 26.77 | % | 26.86 | % | |||||
Expected income tax expense at Canadian enacted statutory tax rates | $ | 842 | $ | 842 | $ | 695 | |||||
(Decrease) increase in taxes resulting from: | |||||||||||
(Gains) losses not subject to tax | (23) | (19) | 8 | ||||||||
Canadian tax rate differentials | (3) | 0 | 0 | ||||||||
Foreign tax rate differentials | (32) | (33) | (55) | ||||||||
Effect of tax rate decrease | (32) | (95) | (21) | ||||||||
Valuation allowance | 0 | (5) | 5 | ||||||||
Unrecognized tax benefits | (7) | 33 | 0 | ||||||||
Other | 13 | (17) | 5 | ||||||||
Income tax expense | $ | 758 | $ | 706 | $ | 637 |
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
Unrecognized tax benefits at January 1 | $ | 52 | $ | 13 | $ | 13 | |||||
Increase in unrecognized: | |||||||||||
Tax benefits related to the current year | 0 | 9 | 1 | ||||||||
Tax benefits related to prior years | 10 | 34 | 0 | ||||||||
Dispositions: | |||||||||||
Gross uncertain tax benefits related to prior years | (9) | 0 | (1) | ||||||||
Settlements with taxing authorities | 2 | (4) | 0 | ||||||||
Unrecognized tax benefits at December 31 | $ | 55 | $ | 52 | $ | 13 |
Name | Option-based awards - value vested during the year ($) | Share-based awards - value vested during the year ($) | Non-equity incentive plan compensation - value earned during the year ($) | |||||||||
Keith Creel | | 2,679,271 | | | 14,138,889 | | | 2,978,994 | | |||
Nadeem Velani | | 256,072 | | | 2,778,742 | | | 1,095,729 | | |||
John Brooks | | 185,799 | | | 1,529,295 | | | 829,259 | | |||
Laird Pitz | | 309,653 | | | 1,353,851 | | | 571,230 | | |||
Mark Redd | | 133,500 | | | 1,309,733 | | | 592,539 | | |||
Robert Johnson | | 462,290 | | | 3,075,226 | | | 523,969 | |
(in millions of Canadian dollars, except per share data) | 2020 | 2019 | 2018 | ||||||||
Net income | $ | 2,444 | $ | 2,440 | $ | 1,951 | |||||
Weighted-average basic shares outstanding (millions) | 135.5 | 138.8 | 142.9 | ||||||||
Dilutive effect of stock options (millions) | 0.5 | 0.5 | 0.4 | ||||||||
Weighted-average diluted shares outstanding (millions) | 136.0 | 139.3 | 143.3 | ||||||||
Earnings per share – basic | $ | 18.05 | $ | 17.58 | $ | 13.65 | |||||
Earnings per share – diluted | $ | 17.97 | $ | 17.52 | $ | 13.61 |
(in millions of Canadian dollars) | Before tax amount | Income tax (expense) recovery | Net of tax amount | ||||||||
For the year ended December 31, 2020 | |||||||||||
Unrealized foreign exchange (loss) gain on: | |||||||||||
Translation of the net investment in U.S. subsidiaries | $ | (118) | $ | 0 | $ | (118) | |||||
Translation of the U.S. dollar-denominated long-term debt designated as a hedge of the net investment in U.S. subsidiaries (Note 17) | 136 | (18) | 118 | ||||||||
Realized loss on derivatives designated as cash flow hedges recognized in income | 9 | (3) | 6 | ||||||||
Change in pension and other benefits actuarial gains and losses | (403) | 108 | (295) | ||||||||
Change in prior service pension and other benefit costs | (4) | 1 | (3) | ||||||||
Other comprehensive loss | $ | (380) | $ | 88 | $ | (292) | |||||
For the year ended December 31, 2019 | |||||||||||
Unrealized foreign exchange (loss) gain on: | |||||||||||
Translation of the net investment in U.S. subsidiaries | $ | (251) | $ | 0 | $ | (251) | |||||
Translation of the U.S. dollar-denominated long-term debt designated as a hedge of the net investment in U.S. subsidiaries (Note 17) | 288 | (38) | 250 | ||||||||
Realized loss on derivatives designated as cash flow hedges recognized in income | 10 | (2) | 8 | ||||||||
Change in pension and other benefits actuarial gains and losses | (661) | 175 | (486) | ||||||||
Other comprehensive loss | $ | (614) | $ | 135 | $ | (479) | |||||
For the year ended December 31, 2018 | |||||||||||
Unrealized foreign exchange gain (loss) on: | |||||||||||
Translation of the net investment in U.S. subsidiaries | $ | 419 | $ | 0 | $ | 419 | |||||
Translation of the U.S. dollar-denominated long-term debt designated as a hedge of the net investment in U.S. subsidiaries (Note 17) | (479) | 64 | (415) | ||||||||
Change in derivatives designated as cash flow hedges: | |||||||||||
Realized loss on cash flow hedges recognized in income | 10 | (3) | 7 | ||||||||
Unrealized gain on cash flow hedges and other | 28 | (8) | 20 | ||||||||
Change in pension and other benefits actuarial gains and losses | (447) | 115 | (332) | ||||||||
Change in prior service pension and other benefit costs | (2) | 1 | (1) | ||||||||
Other comprehensive loss | $ | (471) | $ | 169 | $ | (302) |
(in millions of Canadian dollars) | 2020 | 2019 | ||||||
Unrealized foreign exchange gain on translation of the net investment in U.S. subsidiaries | $ | 493 | $ | 611 | ||||
Unrealized foreign exchange loss on translation of the U.S. dollar-denominated long-term debt designated as a hedge of the net investment in U.S. subsidiaries | (381) | (499) | ||||||
Net deferred losses on derivatives and other | (48) | (54) | ||||||
Amounts for defined benefit pension and other post-retirement plans not recognized in income (Note 22) | (2,878) | (2,580) | ||||||
Accumulated other comprehensive loss | $ | (2,814) | $ | (2,522) |
(in millions of Canadian dollars) | Foreign currency net of hedging activities(1) | Derivatives and other(1) | Pension and post- retirement defined benefit plans(1) | Total(1) | ||||||||||
Opening balance, January 1, 2020 | $ | 112 | $ | (54) | $ | (2,580) | $ | (2,522) | ||||||
Other comprehensive loss before reclassifications | 0 | (2) | (430) | (432) | ||||||||||
Amounts reclassified from accumulated other comprehensive loss | 0 | 8 | 132 | 140 | ||||||||||
Net other comprehensive income (loss) | 0 | 6 | (298) | (292) | ||||||||||
Closing balance, December 31, 2020 | $ | 112 | $ | (48) | $ | (2,878) | $ | (2,814) | ||||||
Opening balance, January 1, 2019 | $ | 113 | $ | (62) | $ | (2,094) | $ | (2,043) | ||||||
Other comprehensive loss before reclassifications | (1) | 0 | (550) | (551) | ||||||||||
Amounts reclassified from accumulated other comprehensive loss | 0 | 8 | 64 | 72 | ||||||||||
Net other comprehensive (loss) income | (1) | 8 | (486) | (479) | ||||||||||
Closing balance, December 31, 2019 | $ | 112 | $ | (54) | $ | (2,580) | $ | (2,522) |
(in millions of Canadian dollars) | 2020 | 2019 | ||||||
Amortization of prior service costs(1) | $ | (1) | $ | 0 | ||||
Recognition of net actuarial loss(1) | 180 | 84 | ||||||
Total before income tax | 179 | 84 | ||||||
Income tax recovery | (47) | (20) | ||||||
Total net of income tax | $ | 132 | $ | 64 |
As at December 31, 2020 | As at December 31, 2019(1) | |||||||||||||||||||
(in millions of Canadian dollars) | Freight | Non-Freight | Total | Freight | Non-Freight | Total | ||||||||||||||
Total accounts receivable | $ | 662 | $ | 203 | $ | 865 | $ | 637 | $ | 210 | $ | 847 | ||||||||
Allowance for credit losses | (25) | (15) | (40) | (26) | (16) | (42) | ||||||||||||||
Total accounts receivable, net | $ | 637 | $ | 188 | $ | 825 | $ | 611 | $ | 194 | $ | 805 |
For the twelve months ended December 31, 2020 | |||||||||||
(in millions of Canadian dollars) | Freight | Non-Freight | Total | ||||||||
Allowance for credit losses, opening balance(1) | $ | (27) | $ | (16) | $ | (43) | |||||
Current period credit loss provision, net | 2 | 1 | 3 | ||||||||
Allowance for credit losses, closing balance | $ | (25) | $ | (15) | $ | (40) |
(in millions of Canadian dollars) | December 22, 2020 | ||||
Fair value of net assets acquired: | |||||
Accounts receivable, net | $ | 5 | |||
Properties | 436 | ||||
Intangible assets (Note 13) | 4 | ||||
Accounts payable and accrued liabilities | (1) | ||||
Deferred taxes | (55) | ||||
Total identifiable assets and liabilities | $ | 389 | |||
Goodwill (Note 13) | 90 | ||||
$ | 479 | ||||
Consideration: | |||||
Cash, net of cash acquired | $ | 398 | |||
Fair value of previously held equity method investment | 81 | ||||
Total consideration | $ | 479 |
(in millions of Canadian dollars) | June 3, 2020 | ||||
Fair value of net assets acquired: | |||||
Cash and cash equivalents | $ | 22 | |||
Accounts receivable, net | 2 | ||||
Properties | 54 | ||||
Intangible assets (Note 13) | 27 | ||||
Accounts payable and accrued liabilities | (13) | ||||
Other long-term liabilities | (6) | ||||
Total identifiable assets and liabilities | $ | 86 | |||
Goodwill (Note 13) | 52 | ||||
$ | 138 | ||||
Consideration: | |||||
Fair value of previously held equity method investment | $ | 138 |
(in millions of Canadian dollars) | December 30, 2019 | ||||
Fair value of net assets acquired: | |||||
Accounts receivable, net | $ | 7 | |||
Properties | 42 | ||||
Intangible assets (Note 13) | 5 | ||||
Accounts payable and accrued liabilities | (2) | ||||
Long-term debt maturing within one year (Note 16) | (11) | ||||
Other long-term liabilities | (4) | ||||
Total identifiable assets and liabilities | 37 | ||||
Goodwill (Note 13) | 10 | ||||
$ | 47 | ||||
Consideration: | |||||
Cash, net of cash acquired | $ | 47 |
(in millions of Canadian dollars) | 2020 | 2019 | ||||||
Investment in CMQ U.S. accounted for on an equity basis (Note 10) | $ | 0 | $ | 127 | ||||
Other rail investments accounted for on an equity basis | 150 | 166 | ||||||
Other investments | 49 | 48 | ||||||
Total investments | $ | 199 | $ | 341 |
2020 | 2020 | 2019 | ||||||||||||||||||||||||||||||||||||
(in millions of Canadian dollars except percentages) | Weighted-average annual depreciation rate | Cost | Accumulated depreciation | Net book value | Cost | Accumulated depreciation | Net book value | |||||||||||||||||||||||||||||||
Track and roadway | 2.8 | % | $ | 20,676 | $ | 5,859 | $ | 14,817 | $ | 19,299 | $ | 5,522 | $ | 13,777 | ||||||||||||||||||||||||
Buildings | 2.9 | % | 937 | 259 | 678 | 833 | 237 | 596 | ||||||||||||||||||||||||||||||
Rolling stock | 2.8 | % | 4,702 | 1,498 | 3,204 | 4,529 | 1,445 | 3,084 | ||||||||||||||||||||||||||||||
Information systems software(1) | 9.3 | % | 569 | 253 | 316 | 527 | 215 | 312 | ||||||||||||||||||||||||||||||
Other | 5.2 | % | 2,167 | 760 | 1,407 | 2,067 | 680 | 1,387 | ||||||||||||||||||||||||||||||
Total | $ | 29,051 | $ | 8,629 | $ | 20,422 | $ | 27,255 | $ | 8,099 | $ | 19,156 |
2020 | 2019 | |||||||||||||||||||
(in millions of Canadian dollars) | Cost | Accumulated depreciation | Net book value | Cost | Accumulated depreciation | Net book value | ||||||||||||||
Rolling stock | 302 | 138 | 164 | 303 | 130 | 173 | ||||||||||||||
Other | 8 | 1 | 7 | 4 | 0 | 4 | ||||||||||||||
Total assets held under finance lease | $ | 310 | $ | 139 | $ | 171 | $ | 307 | $ | 130 | $ | 177 |
Goodwill | Intangible assets | |||||||||||||||||||
(in millions of Canadian dollars) | Net carrying amount | Cost | Accumulated amortization | Net carrying amount | Total goodwill and intangible assets | |||||||||||||||
Balance at December 31, 2018 | $ | 194 | $ | 22 | $ | (14) | $ | 8 | $ | 202 | ||||||||||
Additions (Note 10) | 10 | 5 | — | 5 | 15 | |||||||||||||||
Amortization | — | — | (1) | (1) | (1) | |||||||||||||||
Foreign exchange impact | (10) | — | — | — | (10) | |||||||||||||||
Balance at December 31, 2019 | 194 | 27 | (15) | 12 | 206 | |||||||||||||||
Additions (Note 10) | 142 | 31 | — | 31 | 173 | |||||||||||||||
Amortization | — | — | (3) | (3) | (3) | |||||||||||||||
Foreign exchange impact | (7) | (3) | — | (3) | (10) | |||||||||||||||
Balance at December 31, 2020 | $ | 329 | $ | 55 | $ | (18) | $ | 37 | $ | 366 |
(in millions of Canadian dollars) | 2020 | 2019 | ||||||
Operating lease ROU assets (Note 19) | $ | 316 | $ | 358 | ||||
Contracted customer incentives | 60 | 32 | ||||||
Long-term materials | 37 | 41 | ||||||
Other | 25 | 20 | ||||||
Total other assets | $ | 438 | $ | 451 |
(in millions of Canadian dollars) | 2020 | 2019 | ||||||
Trade payables | $ | 401 | $ | 453 | ||||
Accrued charges | 294 | 348 | ||||||
Accrued interest | 134 | 131 | ||||||
Dividends payable | 127 | 114 | ||||||
Stock-based compensation liabilities | 121 | 85 | ||||||
Income and other taxes payable | 115 | 139 | ||||||
Payroll-related accruals | 68 | 78 | ||||||
Operating lease liabilities (Note 19) | 63 | 69 | ||||||
Accrued vacation | 59 | 60 | ||||||
Personal injury and other claims provision | 37 | 55 | ||||||
Deferred revenue (Note 3) | 27 | 142 | ||||||
Deferred real estate lease and license revenue(1) | 11 | 10 | ||||||
Provision for environmental remediation (Note 18) | 9 | 7 | ||||||
Other(1) | 1 | 2 | ||||||
Total accounts payable and accrued liabilities | $ | 1,467 | $ | 1,693 |
(in millions of Canadian dollars except percentages) | Maturity | Currency in which payable | 2020 | 2019 | ||||||||||||||||
9.450% | 30-year Debentures | (A) | Aug 2021 | U.S.$ | 318 | 325 | ||||||||||||||
5.100% | 10-year Medium Term Notes | (A) | Jan 2022 | CDN$ | 125 | 125 | ||||||||||||||
4.500% | 10-year Notes | (A) | Jan 2022 | U.S.$ | 318 | 324 | ||||||||||||||
4.450% | 12.5-year Notes | (A) | Mar 2023 | U.S.$ | 445 | 454 | ||||||||||||||
2.900% | 10-year Notes | (A) | Feb 2025 | U.S.$ | 891 | 909 | ||||||||||||||
3.700% | 10.5-year Notes | (A) | Feb 2026 | U.S.$ | 318 | 324 | ||||||||||||||
4.000% | 10-year Notes | (A) | Jun 2028 | U.S.$ | 636 | 649 | ||||||||||||||
3.150% | 10-year Notes | (A) | Mar 2029 | CDN$ | 399 | 399 | ||||||||||||||
2.050% | 10-year Notes | (A) | Mar 2030 | U.S.$ | 636 | 0 | ||||||||||||||
7.125% | 30-year Debentures | (A) | Oct 2031 | U.S.$ | 446 | 454 | ||||||||||||||
5.750% | 30-year Debentures | (A) | Mar 2033 | U.S.$ | 312 | 318 | ||||||||||||||
4.800% | 20-year Notes | (A) | Sep 2035 | U.S.$ | 381 | 388 | ||||||||||||||
5.950% | 30-year Notes | (A) | May 2037 | U.S.$ | 567 | 578 | ||||||||||||||
6.450% | 30-year Notes | (A) | Nov 2039 | CDN$ | 400 | 400 | ||||||||||||||
5.750% | 30-year Notes | (A) | Jan 2042 | U.S.$ | 313 | 319 | ||||||||||||||
4.800% | 30-year Notes | (A) | Aug 2045 | U.S.$ | 698 | 712 | ||||||||||||||
3.050% | 30-year Notes | (A) | Mar 2050 | CDN$ | 298 | 0 | ||||||||||||||
6.125% | 100-year Notes | (A) | Sep 2115 | U.S.$ | 1,146 | 1,169 | ||||||||||||||
8.000% | 5-year Promissory Notes | (B) | up to Jun 2020 | U.S.$ | 0 | 11 | ||||||||||||||
5.41% | Senior Secured Notes | (C) | Mar 2024 | U.S.$ | 89 | 100 | ||||||||||||||
6.91% | Secured Equipment Notes | (D) | Oct 2024 | CDN$ | 75 | 91 | ||||||||||||||
7.49% | Equipment Trust Certificates | (E) | Jan 2021 | U.S.$ | 14 | 55 | ||||||||||||||
Obligations under finance leases | ||||||||||||||||||||
1.99% -2.97% | (F) | 2021 - 2023 | CDN$/U.S.$ | 4 | 3 | |||||||||||||||
6.99% | (F) | Mar 2022 | U.S.$ | 97 | 99 | |||||||||||||||
6.57% | (F) | Dec 2026 | U.S.$ | 38 | 45 | |||||||||||||||
12.77% | (F) | Jan 2031 | CDN$ | 4 | 4 | |||||||||||||||
Commercial Paper | up to Feb 2021 | U.S.$ | 820 | 516 | ||||||||||||||||
9,788 | 8,771 | |||||||||||||||||||
Perpetual 4% Consolidated Debenture Stock | (G) | U.S.$ | 39 | 39 | ||||||||||||||||
Perpetual 4% Consolidated Debenture Stock | (G) | G.B.£ | 6 | 6 | ||||||||||||||||
9,833 | 8,816 | |||||||||||||||||||
Unamortized fees on long-term debt | (62) | (59) | ||||||||||||||||||
9,771 | 8,757 | |||||||||||||||||||
Less: Long-term debt maturing within one year | 1,186 | 599 | ||||||||||||||||||
$ | 8,585 | $ | 8,158 |
Name | Number of options exercised and sold | Option exercise price ($) | Value realized ($) | |||||||||
Keith Creel (1) | 59,325 | 115.78 | 12,770,437 | |||||||||
| 53,350 | | | 119.18 | | | 11,301,402 | | ||||
John Brooks (2) | 900 | 51.17 | 234,697 | |||||||||
| 3,200 | | | 65.06 | | | 787,706 | | ||||
Laird Pitz | 4,584 | 175.92 | 393,199 | |||||||||
3,618 | 116.80 | 585,031 | ||||||||||
2,377 | 150.99 | 276,409 | ||||||||||
| 1,097 | | | 185.85 | | | 77,370 | | ||||
Mark Redd | | 1,410 | | | 168.84 | | | 205,910 | | |||
Robert Johnson (3) | 3,640 | 129.54 | 669,053 | |||||||||
5,870 | 168.84 | 845,179 | ||||||||||
5,198 | 175.92 | 397,230 | ||||||||||
6,183 | 116.80 | 953,444 | ||||||||||
5,779 | 150.99 | 630,239 | ||||||||||
| 2,347 | | | 185.85 | | | 147,957 | |
(in millions of Canadian dollars) | 2020 | 2019 | ||||||
Operating lease liabilities, net of current portion (Note 19) | $ | 248 | $ | 285 | ||||
Stock-based compensation liabilities, net of current portion | 146 | 111 | ||||||
Provision for environmental remediation, net of current portion(1) | 71 | 70 | ||||||
Deferred revenue, net of current portion (Note 3)(2) | 34 | 4 | ||||||
Deferred real estate lease and license revenue, net of current portion(3) | 18 | 20 | ||||||
Deferred gains on sale leaseback transactions(3) | 5 | 6 | ||||||
Other, net of current portion (2) | 63 | 66 | ||||||
Total other long-term liabilities | $ | 585 | $ | 562 |
Plan Category | Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights ($) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in the first column) | |||||||||
Equity compensation plans approved by security holders | | 1,416,346 | | | 199.12 | | | 1,438,707 | | |||
Equity compensation plans not approved by security holders | | - | | | - | | | - | | |||
Total | 1,416,346 | 199.12 | 1,438,707 |
(in millions of Canadian dollars) | 2020 | 2019 | ||||||
Operating lease cost | $ | 83 | $ | 89 | ||||
Short-term lease cost | 10 | 10 | ||||||
Variable lease cost | 13 | 13 | ||||||
Sublease income | (3) | (3) | ||||||
Finance Lease Cost | ||||||||
Amortization of right-of-use assets | 9 | 9 | ||||||
Interest on lease liabilities | 11 | 11 | ||||||
Total lease costs | $ | 123 | $ | 129 |
(in millions of Canadian dollars) | Classification | 2020 | 2019 | ||||||||
Assets | |||||||||||
Operating | Other assets | $ | 316 | $ | 358 | ||||||
Finance | Properties, net book value | 171 | 177 | ||||||||
Liabilities | |||||||||||
Current | |||||||||||
Operating | Accounts payable and accrued liabilities | 63 | 69 | ||||||||
Finance | Long-term debt maturing within one year | 8 | 7 | ||||||||
Long-term | |||||||||||
Operating | Other long-term liabilities | 248 | 285 | ||||||||
Finance | Long-term debt | 135 | 144 |
2020 | 2019 | |||||||
Weighted-Average Remaining Lease Term | ||||||||
Operating leases | 7 years | 7 years | ||||||
Finance leases | 3 years | 4 years | ||||||
Weighted-Average Discount Rate | ||||||||
Operating leases | 3.32 | % | 3.45 | % | ||||
Finance leases | 7.06 | % | 7.07 | % |
(in millions of Canadian dollars) | 2020 | 2019 | ||||||
Cash paid for amounts included in measurement of lease liabilities | ||||||||
Operating cash outflows from operating leases | $ | 74 | $ | 82 | ||||
Operating cash outflows from finance leases | 10 | 10 | ||||||
Financing cash outflows from finance leases | 8 | 6 | ||||||
Right-of-use assets obtained in exchange for lease liabilities | ||||||||
Operating leases | 34 | 38 | ||||||
Finance leases | 4 | 4 |
(in millions of Canadian dollars) | Finance Leases | Operating Leases | ||||||
2021 | $ | 11 | $ | 71 | ||||
2022 | 107 | 59 | ||||||
2023 | 9 | 53 | ||||||
2024 | 8 | 42 | ||||||
2025 | 8 | 34 | ||||||
Thereafter | 12 | 88 | ||||||
Total lease payments | 155 | 347 | ||||||
Imputed interest | (12) | (36) | ||||||
Present value of lease payments | $ | 143 | $ | 311 |
(number of shares in millions) | 2020 | 2019 | 2018 | ||||||||
Share capital, January 1 | 137.0 | 140.5 | 144.9 | ||||||||
CP Common Shares repurchased | (4.0) | (3.8) | (4.6) | ||||||||
Shares issued under stock option plan | 0.3 | 0.3 | 0.2 | ||||||||
Share capital, December 31 | 133.3 | 137.0 | 140.5 |
2020 | 2019 | 2018 | |||||||||
Number of Common Shares repurchased(1) | 3,973,076 | 3,794,149 | 4,683,162 | ||||||||
Weighted-average price per share(2) | $ | 371.74 | $ | 300.65 | $ | 240.68 | |||||
Amount of repurchase (in millions)(2) | $ | 1,477 | $ | 1,141 | $ | 1,127 |
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
(Use) source of cash: | |||||||||||
Accounts receivable, net | $ | (61) | $ | 27 | $ | (107) | |||||
Materials and supplies | (15) | (8) | (11) | ||||||||
Other current assets | (5) | (24) | 30 | ||||||||
Accounts payable and accrued liabilities | (308) | (21) | 153 | ||||||||
Change in non-cash working capital | $ | (389) | $ | (26) | $ | 65 |
Pensions | Other benefits | ||||||||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | 2020 | 2019 | 2018 | |||||||||||||||||
Current service cost (benefits earned by employees) | $ | 140 | $ | 107 | $ | 120 | $ | 12 | $ | 11 | $ | 12 | |||||||||||
Other components of net periodic benefit cost (recovery): | |||||||||||||||||||||||
Interest cost on benefit obligation | 406 | 450 | 438 | 17 | 20 | 19 | |||||||||||||||||
Expected return on fund assets | (945) | (947) | (955) | 0 | 0 | 0 | |||||||||||||||||
Recognized net actuarial loss | 177 | 84 | 114 | 4 | 12 | 2 | |||||||||||||||||
Amortization of prior service costs | (1) | (1) | (2) | 0 | 1 | 0 | |||||||||||||||||
Total other components of net periodic benefit (recovery) cost | (363) | (414) | (405) | 21 | 33 | 21 | |||||||||||||||||
Net periodic benefit (recovery) cost | $ | (223) | $ | (307) | $ | (285) | $ | 33 | $ | 44 | $ | 33 |
Pensions | Other benefits | ||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2020 | 2019 | |||||||||||||
Change in projected benefit obligation: | |||||||||||||||||
Benefit obligation at January 1 | $ | 12,610 | $ | 11,372 | $ | 541 | $ | 501 | |||||||||
Current service cost | 140 | 107 | 12 | 11 | |||||||||||||
Interest cost | 406 | 450 | 17 | 20 | |||||||||||||
Employee contributions | 42 | 41 | 0 | 0 | |||||||||||||
Benefits paid | (653) | (646) | (34) | (34) | |||||||||||||
Foreign currency changes | (5) | (10) | 0 | 0 | |||||||||||||
Plan amendments and other | 3 | 0 | 0 | 0 | |||||||||||||
Actuarial loss | 1,256 | 1,296 | 17 | 43 | |||||||||||||
Projected benefit obligation at December 31 | $ | 13,799 | $ | 12,610 | $ | 553 | $ | 541 |
Pensions | Other benefits | ||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2020 | 2019 | |||||||||||||
Change in fund assets: | |||||||||||||||||
Fair value of fund assets at January 1 | $ | 13,319 | $ | 12,349 | $ | 5 | $ | 4 | |||||||||
Actual return on fund assets | 1,634 | 1,528 | 0 | 1 | |||||||||||||
Employer contributions | 27 | 53 | 34 | 34 | |||||||||||||
Employee contributions | 42 | 41 | 0 | 0 | |||||||||||||
Benefits paid | (653) | (646) | (34) | (34) | |||||||||||||
Foreign currency changes | (4) | (6) | 0 | 0 | |||||||||||||
Fair value of fund assets at December 31 | $ | 14,365 | $ | 13,319 | $ | 5 | $ | 5 | |||||||||
Funded status – plan surplus (deficit) | $ | 566 | $ | 709 | $ | (548) | $ | (536) |
2020 | 2019 | ||||||||||||||||
(in millions of Canadian dollars) | Pension plans in surplus | Pension plans in deficit | Pension plans in surplus | Pension plans in deficit | |||||||||||||
Projected benefit obligation at December 31 | $ | (13,220) | $ | (579) | $ | (12,076) | $ | (534) | |||||||||
Fair value of fund assets at December 31 | 14,114 | 251 | 13,079 | 240 | |||||||||||||
Funded Status | $ | 894 | $ | (328) | $ | 1,003 | $ | (294) |
Pensions | Other benefits | ||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2020 | 2019 | |||||||||||||
Pension asset | $ | 894 | $ | 1,003 | $ | 0 | $ | 0 | |||||||||
Accounts payable and accrued liabilities | (11) | (11) | (33) | (34) | |||||||||||||
Pension and other benefit liabilities | (317) | (283) | (515) | (502) | |||||||||||||
Total amount recognized | $ | 566 | $ | 709 | $ | (548) | $ | (536) |
Pensions | Other benefits | ||||||||||||||||
(in millions of Canadian dollars) | 2020 | 2019 | 2020 | 2019 | |||||||||||||
Net actuarial loss: | |||||||||||||||||
Other than deferred investment gains | $ | 3,960 | $ | 3,434 | $ | 104 | $ | 91 | |||||||||
Deferred investment gains | (95) | 41 | 0 | 0 | |||||||||||||
Prior service cost | 5 | 1 | 1 | 1 | |||||||||||||
Deferred income tax | (1,070) | (964) | (27) | (24) | |||||||||||||
Total (Note 8) | $ | 2,800 | $ | 2,512 | $ | 78 | $ | 68 |
(percentages) | 2020 | 2019 | 2018 | |||||||||||||||||
Benefit obligation at December 31: | ||||||||||||||||||||
Discount rate | 2.58 | 3.25 | 4.01 | |||||||||||||||||
Projected future salary increases | 2.75 | 2.75 | 2.75 | |||||||||||||||||
Health care cost trend rate | 5.00 | (1) | 5.50 | (1) | 6.00 | (1) | ||||||||||||||
Benefit cost for year ended December 31: | ||||||||||||||||||||
Discount rate | 3.25 | 4.01 | 3.80 | |||||||||||||||||
Expected rate of return on fund assets (3) | 7.25 | 7.50 | 7.75 | |||||||||||||||||
Projected future salary increases | 2.75 | 2.75 | 2.75 | |||||||||||||||||
Health care cost trend rate | 5.50 | (1) | 6.00 | (1) | 7.00 | (2) |
Percentage of plan assets at December 31 | ||||||||||||||
Asset allocation (percentage) | Asset allocation target | Policy range | 2020 | 2019 | ||||||||||
Cash and cash equivalents | 1.2 | 0 – 10 | 2.0 | 0.9 | ||||||||||
Fixed income | 24.1 | 20 – 40 | 28.1 | 24.6 | ||||||||||
Public equity | 45.1 | 35 – 55 | 49.3 | 54.5 | ||||||||||
Real estate and infrastructure | 9.8 | 4 – 13 | 6.3 | 6.8 | ||||||||||
Private debt | 9.8 | 4 – 13 | 3.3 | 2.4 | ||||||||||
Absolute return | 10.0 | 4 – 13 | 11.0 | 10.8 | ||||||||||
Total | 100.0 | 100.0 | 100.0 |
Assets Measured at Fair Value | Investments measured at NAV(1) | Total Plan Assets | |||||||||||||||
(in millions of Canadian dollars) | Quoted prices in active markets for identical assets (Level 1) | Significant other observable inputs (Level 2) | |||||||||||||||
December 31, 2020 | |||||||||||||||||
Cash and cash equivalents | $ | 219 | $ | 0 | $ | 0 | $ | 219 | |||||||||
Fixed income | |||||||||||||||||
Government bonds(2) | 284 | 1,699 | 0 | 1,983 | |||||||||||||
Corporate bonds(2) | 691 | 1,144 | 0 | 1,835 | |||||||||||||
Mortgages(3) | 220 | 5 | 0 | 225 | |||||||||||||
Public equities | |||||||||||||||||
Canada | 1,183 | 0 | 0 | 1,183 | |||||||||||||
U.S. and international | 5,871 | 28 | 0 | 5,899 | |||||||||||||
Real estate(4) | 0 | 0 | 704 | 704 | |||||||||||||
Infrastructure(5) | 0 | 0 | 199 | 199 | |||||||||||||
Private debt(6) | 0 | 0 | 465 | 465 | |||||||||||||
Derivative instruments(7) | 0 | 71 | 0 | 71 | |||||||||||||
Absolute return(8) | |||||||||||||||||
Funds of hedge funds | 0 | 0 | 1,560 | 1,560 | |||||||||||||
Multi-strategy funds | 0 | 0 | 22 | 22 | |||||||||||||
$ | 8,468 | $ | 2,947 | $ | 2,950 | $ | 14,365 | ||||||||||
December 31, 2019 | |||||||||||||||||
Cash and cash equivalents | $ | 112 | $ | 0 | $ | 0 | $ | 112 | |||||||||
Fixed income | |||||||||||||||||
Government bonds(2) | 233 | 1,857 | 0 | 2,090 | |||||||||||||
Corporate bonds(2) | 273 | 819 | 0 | 1,092 | |||||||||||||
Mortgages(3) | 159 | 5 | 0 | 164 | |||||||||||||
Public equities | |||||||||||||||||
Canada | 1,351 | 0 | 0 | 1,351 | |||||||||||||
U.S. and international | 5,883 | 22 | 0 | 5,905 | |||||||||||||
Real estate(4) | 0 | 0 | 724 | 724 | |||||||||||||
Infrastructure(5) | 0 | 0 | 187 | 187 | |||||||||||||
Private debt(6) | 0 | 0 | 313 | 313 | |||||||||||||
Derivative instruments(7) | 0 | (59) | 0 | (59) | |||||||||||||
Absolute return(8) | |||||||||||||||||
Funds of hedge funds | 0 | 0 | 1,418 | 1,418 | |||||||||||||
Multi-strategy funds | 0 | 0 | 22 | 22 | |||||||||||||
$ | 8,011 | $ | 2,644 | $ | 2,664 | $ | 13,319 |
(in millions of Canadian dollars) | Pensions | Other benefits | ||||||
2021 | $ | 632 | $ | 33 | ||||
2022 | 629 | 31 | ||||||
2023 | 631 | 31 | ||||||
2024 | 633 | 30 | ||||||
2025 | 635 | 30 | ||||||
2026-2030 | 3,203 | 142 |
Options outstanding | Non-vested options | ||||||||||||||||
Number of options | Weighted-average exercise price | Number of options | Weighted-average grant date fair value | ||||||||||||||
Outstanding, January 1, 2020 | 1,416,346 | $ | 199.12 | 761,784 | $ | 53.54 | |||||||||||
Granted | 217,240 | $ | 344.04 | 217,240 | $ | 69.00 | |||||||||||
Exercised | (232,034) | $ | 162.87 | N/A | N/A | ||||||||||||
Vested | N/A | N/A | (188,108) | $ | 50.91 | ||||||||||||
Forfeited | (13,839) | $ | 271.75 | (13,839) | $ | 58.29 | |||||||||||
Expired | (347) | $ | 168.84 | N/A | N/A | ||||||||||||
Outstanding, December 31, 2020 | 1,387,366 | $ | 225.20 | 777,077 | $ | 58.40 | |||||||||||
Vested or expected to vest at December 31, 2020(1) | 1,366,649 | $ | 223.98 | N/A | N/A | ||||||||||||
Exercisable, December 31, 2020 | 610,289 | $ | 177.65 | N/A | N/A |
Options outstanding | Options exercisable | |||||||||||||||||||||||||
Range of exercise prices | Number of options | Weighted-average years to expiration | Weighted-average exercise price | Aggregate intrinsic value (millions) | Number of options | Weighted-average exercise price | Aggregate intrinsic value (millions) | |||||||||||||||||||
$65.06 - $188.78 | 342,773 | 3.4 | $ | 141.26 | $ | 103 | 342,773 | $ | 141.26 | $ | 103 | |||||||||||||||
$188.79 - $214.58 | 327,811 | 3.1 | $ | 196.82 | $ | 80 | 109,375 | $ | 203.83 | $ | 26 | |||||||||||||||
$214.59 - $261.88 | 394,953 | 4.4 | $ | 244.17 | $ | 78 | 134,845 | $ | 232.54 | $ | 28 | |||||||||||||||
$261.89 - $411.37 | 321,829 | 5.8 | $ | 320.21 | $ | 39 | 23,296 | $ | 272.56 | $ | 4 | |||||||||||||||
Total(1) | 1,387,366 | 4.2 | $ | 225.20 | $ | 300 | 610,289 | $ | 177.65 | $ | 161 |
2020 | 2019 | 2018 | |||||||||
Expected option life (years)(1) | 4.75 | 5.00 | 5.00 | ||||||||
Risk-free interest rate(2) | 1.28 | % | 2.22 | % | 2.22 | % | |||||
Expected stock price volatility(3) | 23.14 | % | 25.04 | % | 24.81 | % | |||||
Expected annual dividends per share(4) | $ | 3.3200 | $ | 2.6191 | $ | 2.3854 | |||||
Expected forfeiture rate(5) | 4.41 | % | 6.05 | % | 4.70 | % | |||||
Weighted-average grant date fair value of options granted during the year | $ | 69.00 | $ | 63.69 | $ | 55.63 |
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
Total intrinsic value | $ | 52 | $ | 63 | $ | 17 | |||||
Cash received by the Company upon exercise of options | 52 | 26 | 24 |
2020 | 2019 | |||||||
Outstanding, January 1 | 403,136 | 395,048 | ||||||
Granted | 108,027 | 134,260 | ||||||
Units, in lieu of dividends | 3,843 | 4,032 | ||||||
Settled | (121,225) | (117,228) | ||||||
Forfeited | (11,912) | (12,976) | ||||||
Outstanding, December 31 | 381,869 | 403,136 |
2020 | 2019 | |||||||
Outstanding, January 1 | 161,219 | 152,760 | ||||||
Granted | 19,041 | 19,912 | ||||||
Units, in lieu of dividends | 1,511 | 1,608 | ||||||
Settled | (26,788) | (12,110) | ||||||
Forfeited | (172) | (951) | ||||||
Outstanding, December 31 | 154,811 | 161,219 |
(in millions of Canadian dollars) | 2020 | 2019 | 2018 | ||||||||
Plan | |||||||||||
PSUs | $ | 76 | $ | 54 | $ | 30 | |||||
DSUs | 9 | 4 | 6 | ||||||||
Other | 1 | 0 | 1 | ||||||||
Total | $ | 86 | $ | 58 | $ | 37 |
(in millions of Canadian dollars) | Canada | United States | Total | ||||||||
2020 | |||||||||||
Revenues | $ | 5,829 | $ | 1,881 | $ | 7,710 | |||||
Long-term assets excluding financial instruments and pension assets | 14,258 | 7,165 | 21,423 | ||||||||
2019 | |||||||||||
Revenues | 5,675 | 2,117 | 7,792 | ||||||||
Long-term assets excluding financial instruments and pension assets | 13,131 | 7,020 | 20,151 | ||||||||
2018 | |||||||||||
Revenues | 5,232 | 2,084 | 7,316 | ||||||||
Long-term assets excluding financial instruments and pension assets | 12,133 | 6,759 | 18,892 |
For the quarter ended | 2020 | 2019 | ||||||||||||||||||||||||
(in millions of Canadian dollars, except per share data) | Dec. 31 | Sep. 30 | Jun. 30 | Mar. 31 | Dec. 31 | Sep. 30 | Jun. 30 | Mar. 31 | ||||||||||||||||||
Total revenues | $ | 2,012 | $ | 1,863 | $ | 1,792 | $ | 2,043 | $ | 2,069 | $ | 1,979 | $ | 1,977 | $ | 1,767 | ||||||||||
Operating income | 928 | 779 | 770 | 834 | 890 | 869 | 822 | 543 | ||||||||||||||||||
Net income | 802 | 598 | 635 | 409 | 664 | 618 | 724 | 434 | ||||||||||||||||||
Basic earnings per share(1) | $ | 5.97 | $ | 4.42 | $ | 4.68 | $ | 2.99 | $ | 4.84 | $ | 4.47 | $ | 5.19 | $ | 3.10 | ||||||||||
Diluted earnings per share(1) | $ | 5.95 | $ | 4.41 | $ | 4.66 | $ | 2.98 | $ | 4.82 | $ | 4.46 | $ | 5.17 | $ | 3.09 |
Accumulated value at start of year ($) | Compensatory ($) | Accumulated value at year end ($) | ||||||||||
Keith Creel | | 1,262,991 | | | 543,653 | | | 2,041,957 | | |||
Nadeem Velani | | 455,364 | | | 214,043 | | | 774,411 | |
Years of credited service | Annual benefits payable | Opening present value of defined benefit obligation ($) | Compensatory change ($) | Non-compensatory change ($) | Closing present value of defined benefit obligation ($) | |||||||||||||||||||||||||||
Name | At December 31, 2019 | At age 65 | At year end ($) | At age 65 ($) | ||||||||||||||||||||||||||||
John Brooks | | 11.17 | | | 27.25 | | | 109,679 | | | 267,571 | | | 571,271 | | | 254,186 | | | 258,866 | | | 1,084,323 | |
Accumulated value at start of year ($) | Compensatory ($) | Accumulated value at year end ($) | ||||||||||
Keith Creel | | 841,702 | | 22,690 | 1,045,509 | |||||||
Laird Pitz | | 267,437 | | 104,830 | 406,946 | |||||||
Mark Redd | | 126,699 | | | 96,231 | | | 246,286 | | |||
Robert Johnson | | 401,049 | | | 121,175 | | | 518,583 | |
Unvested DSUs (#) | Vested DSUs (#) | Total Units (#) | Value as at December 31, 2019 ($) | |||||||||||||
Keith Creel | | 0 | | | 31,849 | | | 31,849 | | | 10,546,129 | | ||||
Nadeem Velani | | 394 | | | 2,595 | | | 2,989 | | | 989,449 | | ||||
John Brooks | | 166 | | | 1,671 | | | 1,837 | | | 608,284 | | ||||
Laird Pitz | | 0 | | | 4,434 | | | 4,434 | | | 1,468,226 | | ||||
Mark Redd | | 140 | | | 999 | | | 1,139 | | | 377,156 | | ||||
Robert Johnson | | 0 | | | 6,322 | | | 6,322 | | | 2,093,398 | |
Severance payment | ||||||||||||||||||||||||||||
Name | Severance period (# of months) | Base pay ($) | Short-term incentive ($) | Additional retirement benefits ($) | Other benefits ($) | Value of vesting of options and equity-based awards ($) | Payable on termination without cause ($) | |||||||||||||||||||||
Keith Creel | | 24 | | | 3,009,969 | | | 3,762,461 | | | - | | | 41,912 | | | 12,642,454 | | | 19,456,796 | |
Name | Fees earned ($) | Share-based awards (1)(3) ($) | Option-based awards ($) | Non-equity incentive plan compensation ($) | Pension value ($) | All other compensation (2)(3) ($) | Total ($) | |||||||||||||||||||||
John Baird | - | 261,471 | - | - | - | 1,000 | 262,471 | |||||||||||||||||||||
Isabelle Courville | - | 439,366 | - | - | - | 1,000 | 440,366 | |||||||||||||||||||||
Jill Denham | - | 261,471 | - | - | - | 1,000 | 262,471 | |||||||||||||||||||||
Edward Hamberger (4) | - | 121,403 | - | - | - | 1,327 | 122,730 | |||||||||||||||||||||
Rebecca MacDonald | - | 300,691 | - | - | - | 1,000 | 301,691 | |||||||||||||||||||||
Edward Monser | - | 264,765 | - | - | - | 1,327 | 266,092 | |||||||||||||||||||||
Matthew Paull | - | 304,480 | - | - | - | 1,327 | 305,807 | |||||||||||||||||||||
Jane Peverett | - | 300,691 | - | - | - | 1,000 | 301,691 | |||||||||||||||||||||
Andrea Robertson (4) | - | 119,163 | - | - | - | 1,000 | 120,163 | |||||||||||||||||||||
Gordon Trafton | - | 284,456 | - | - | - | 1,327 | 285,783 | |||||||||||||||||||||
Andrew Reardon (5) | 92,154 | 93,073 | - | - | - | - | 185,227 |
securities underlying unexercised options | exercise price | date | unexercised options | type | shares or units of shares that have not vested | payout value of share-based awards that have not vested | value of vested share-based awards not paid out or distributed | |||||||||||||||||||||||||
Name of beneficial owner 1 | Shares of common stock beneficially owned | Percent of common stock outstanding | ||||||
John Baird (a) | — | — | ||||||
Isabelle Courville (a) | 900 | * | ||||||
Jill Denham (a) | 0 | — | ||||||
Edward Hamberger (a) | 0 | — | ||||||
Rebecca MacDonald (a) | 0 | — | ||||||
Edward Monser (a) | 0 | — | ||||||
Matthew Paull (a) | 3,000 | * | ||||||
Jane Peverett (a) | 0 | — | ||||||
Andrea Robertson (a) | 0 | — | ||||||
Gordon T. Trafton (a) | 0 | — | ||||||
Keith E. Creel (b)(c) | 269,726 | * | ||||||
John K. Brooks (b)(d) | 24,142 | * | ||||||
Robert A. Johnson (b)(e) | 9,638 | * | ||||||
Laird J. Pitz (b)(f) | 6,041 | * | ||||||
Mark A. Redd (b)(g) | 6,534 | * | ||||||
Nadeem S. Velani (b)(h) | 23,419 | * | ||||||
TCI Fund Management Limited (i) | 10,978,084 | 8.09 | % | |||||
All current executive officers and directors as a group | 420,737 | * |
For the year ended December 31 | 2019 | 2018 | ||||||
Audit fees for audit of our annual financial statements, reviews of quarterly reports and services relating to statutory and regulatory filings or engagements (including attestation services and audit or interim review of financial statements of certain subsidiaries and certain pension and benefits plans, and advice on accounting and/or disclosure matters) | $ | 3,576,300 | $ | 3,800,200 | ||||
Audit-related fees for assurance and services related to the audit but not included in the audit fees above, including securities filings | $ | 169,700 | $ | 138,800 | ||||
Tax fees for services relating to tax compliance, tax planning and tax advice | $ | 35,500 | $ | 121,000 | ||||
All other fees for services provided relating to CP’s corporate sustainability report and training programs | $ | 90,500 | $ | 54,000 | ||||
Total | $ | 3,872,000 | $ | 4,114,000 |
(in millions of Canadian dollars) | Beginning balance at January 1 | Additions charged to expenses | Payments and other reductions | Impact of FX | Ending balance at December 31 | ||||||||||||
Accruals for personal injury and other claims provision(1) | |||||||||||||||||
2018 | $ | 118 | $ | 93 | $ | (60) | $ | 1 | $ | 152 | |||||||
2019 | $ | 152 | $ | 142 | $ | (152) | $ | (1) | $ | 141 | |||||||
2020 | $ | 141 | $ | 105 | $ | (119) | $ | (1) | $ | 126 | |||||||
Environmental liabilities | |||||||||||||||||
2018 | $ | 78 | $ | 6 | $ | (7) | $ | 5 | $ | 82 | |||||||
2019 | $ | 82 | $ | 6 | $ | (8) | $ | (3) | $ | 77 | |||||||
2020 | $ | 77 | $ | 10 | $ | (6) | $ | (1) | $ | 80 |
Description | |||||
3 | Articles of Incorporation and Bylaws: | ||||
4 | Instruments Defining the Rights of Security Holders, Including Indentures: | ||||
10 | Material Contracts: | ||||
Fifth Amending Agreement, dated as of June 8, 2018, amending the Credit Agreement, dated September 26, 2014, between Canadian Pacific Railway Company, as Borrower, Canadian Pacific Railway Limited, as Covenantor, Royal Bank of Canada, as Administrative Agent, and the various Lenders party thereto (incorporated by reference to Exhibit 10.1 to Canadian Pacific Railway Limited's Current Report on Form 8-K filed with the Securities and Exchange Commission on June 11, 2018, File No. 001-01342). | |||||
Amendment dated as of January 1, 2019, to the Executive Employment Agreement between Canadian Pacific Railway Company and Keith Creel, dated July 23, 2016 and effective as of July 1, 2017 as amended as of January 31, 2017 (incorporated by reference to Exhibit 10.49 to Canadian Pacific Railway Limited's Form 10-K filed with the Securities and Exchange Commission on February 15, 2019, File No. 001-01342). | |||||
101.INS** | Inline XBRL Instance Document | ||||
101.SCH** | Inline XBRL Taxonomy Extension Schema Document | ||||
101.CAL** | Inline XBRL Taxonomy Extension Calculation Linkbase Document | ||||
101.LAB** | Inline XBRL Taxonomy Extension Label Linkbase Document | ||||
101.DEF** | Inline XBRL Taxonomy Extension Definition Linkbase Document | ||||
101.PRE** | Inline XBRL Taxonomy Extension Presentation Linkbase Document | ||||
The following financial information from Canadian Pacific Railway Limited’s Annual Report on Form 10-K for the year ended December 31, 2020, formatted in Extensible Business Reporting Language (XBRL) includes: (i) the Consolidated Statements of Income for each of the three years ended December 31, 2020, 2019, and 2018; (ii) the Consolidated Statements of Comprehensive Income for each of the three years ended December 31, 2020, 2019, and 2018; (iii) the Consolidated Balance Sheets at December 31, 2020 and 2019; (iv) the Consolidated Statements of Cash Flows for each of the three years ended December 31, 2020, 2019, and 2018; (v) the Consolidated Statements of Changes in Shareholders’ Equity for each of the three years ended December 31, 2020, 2019, and 2018; and (vi) the Notes to Consolidated Financial Statements. | |||||
104 ** | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
CANADIAN PACIFIC RAILWAY LIMITED | ||||||
(Registrant) | ||||||
By: | /s/ KEITH CREEL | |||||
Keith Creel | ||||||
Title | ||||||
/s/ KEITH CREEL | ||||||
Keith Creel | (Principal Executive Officer) | |||||
/s/ NADEEM VELANI | Executive Vice-President and Chief Financial Officer | |||||
Nadeem Velani | (Principal Financial | |||||
Chair of the Board of Directors | ||||||
Isabelle Courville | ||||||
/s/ JOHN R. BAIRD | Director | |||||
John R. Baird | ||||||
/s/ GILLIAN H. DENHAM | Director | |||||
Gillian H. Denham | ||||||
/s/ EDWARD R. HAMBERGER | Director | |||||
Edward R. Hamberger | ||||||
Director | ||||||
Rebecca MacDonald | ||||||
/s/ EDWARD L. MONSER | Director | |||||
Edward L. Monser | ||||||
/s/ MATTHEW H. PAULL | Director | |||||
Matthew H. Paull | ||||||
/s/ JANE L. PEVERETT | Director | |||||
Jane L. Peverett | ||||||
/s/ ANDREA ROBERTSON | Director | |||||
Andrea Robertson | ||||||
/s/ GORDON T. TRAFTON | Director | |||||
Gordon T. Trafton | ||||||