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CN Rail Posts Record Q2
Revenues of C$4.3 Billion

Ingrid Hendershot, CEO of Hendershot Investments, a money management firm, reports on Q2 results for Canadian National Railway: Canadian National Railway (NYSE: CNI; TSX: CNR) reported record second quarter revenue of C$4.3 billion an increase of 21% with net income up 28% to C$1.3 billion and EPS chugging ahead 32% to C$1.92.

The increase in revenues was mainly due to higher applicable fuel surcharge rates, freight rate increases, higher Canadian export volumes of coal via west coast ports, higher volumes of U.S. grain and the positive translation impact of a weaker Canadian dollar; partly offset by significantly lower export volumes of Canadian grain.

Revenue ton miles increased 2% year-over-year to 60.5 billion and fuel efficiency improved by 4% to a record of 0.838 US gallons of locomotive fuel consumed per 1,000 gross ton miles. In addition, car velocity (car miles per day) improved by 2%.

During the first half of the year, the company generated C$1.2 billion in free cash flow and returned C$3.4 billion to shareholders through share repurchases of C$2.4 billion and dividends paid of C$1 billion.

Canadian National ended the quarter with C$465 million in cash, C$11.9 billion in long-term debt and C$21.7 billion in shareholders’ equity.

Management reaffirmed 2022 guidance of 15-20% adjusted EPS growth and an operating ratio below 60% as well as a ROIC of approximately 15%.

Canadian National maintained its free cash flow target in the range of C$3.7 billion to C$4 billion and expects to invest approximately 17% of revenues in its capital program. In addition, management continues to expect volume growth, in terms of Revenue ton miles (RTMs) in the low single-digit range and continues to expect significantly lower volumes of Canadian grain and lower volumes of potash as well as lumber and panels for 2022 compared to 2021.

CN’s Board of Directors has approved a third-quarter 2022 dividend on the Company’s common shares outstanding. A quarterly dividend of seventy-three and a quarter cents (C$0.7325) per common share will be paid on September 29, 2022, to shareholders of record at the close of business on September 8, 2022.

About Canadian National Railway CN is a world-class transportation leader and trade-enabler. Essential to the economy, to the customers, and to the communities it serves, CN safely transports more than 300 million tons of natural resources, manufactured products, and finished goods throughout North America every year.

As the only railroad connecting Canada’s Eastern and Western coasts with the U.S. South through a 18,600-mile rail network, CN and its affiliates have been contributing to community prosperity and sustainable trade since 1919. CN is committed to programs supporting social responsibility and environmental stewardship.

For further information on Canadian National Railway contact Paul Butcher, VP, Investor Relations at (514) 399-0052. Email: investor.relations@cn.ca or visit the website at www.cn.ca.

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