CPKC showcases strength of Precision Scheduled Railroading; delivers record margins

Executive Summary

• CPKC reported fourth-quarter 2025 revenues of $3.9 billion (up 1% year-over-year) and a record core adjusted operating ratio of 55.9%, reflecting improved operational efficiency despite macroeconomic headwinds.
• Full-year 2025 revenues reached $15.1 billion (up 4%), with core adjusted diluted EPS increasing 8% to $4.61, driven by cost controls and volume growth in key commodities like grain and intermodal.
• The company provided 2026 guidance anticipating low double-digit core adjusted diluted EPS growth, mid-single-digit volume growth, and capital expenditures of $2.65 billion.

Key Details

• Q4 2025 Financials:
  • Revenues: $3.9 billion (up 1% from Q4 2024).
  • Reported Operating Ratio (OR): 58.9% (improved 80 bps).
  • Core Adjusted OR: 55.9% (record low, improved 120 bps).
  • Reported Diluted EPS: $1.20 (down from $1.28 in Q4 2024).
  • Core Adjusted Diluted EPS: $1.33 (up 3% from $1.29 in Q4 2024).
• Full-Year 2025 Financials:
  • Revenues: $15.1 billion (up 4% from $14.5 billion in 2024).
  • Reported Operating Ratio: 62.8% (improved 160 bps).
  • Core Adjusted OR: 59.9% (record low, improved 140 bps).
  • Reported Diluted EPS: $4.51 (up from $3.98 in 2024).
  • Core Adjusted Diluted EPS: $4.61 (up 8% from $4.25 in 2024).
• Operational Metrics (Q4 2025 vs Q4 2024):
  • Record metrics achieved in train weights, network speed, locomotive productivity, and car miles per car day.
  • FRA-reportable personal injury frequency: 0.92 (down from 0.95).
  • FRA-reportable train accident frequency: 0.85 (down from 1.01).
• Commodity Performance (Full Year 2025):
  • Grain Revenue: $3.2 billion (up 7% or 5% FX-adjusted).
  • Intermodal Revenue: $2.7 billion (up 6% or 5% FX-adjusted).
  • Coal Revenue: $1.0 billion (up 9% or 8% FX-adjusted).
  • Energy, Chemicals and Plastics Revenue: $2.9 billion (up 2%).
  • Automotive Revenue: $1.3 billion (up 2% or 2% FX-adjusted).
• 2026 Guidance:
  • Core Adjusted Diluted EPS: Low double-digit growth vs. 2025 core adjusted diluted EPS of $4.61.
  • Volume: Mid-single-digit growth in Revenue Ton Miles (RTM).
  • Capital Expenditures: $2.65 billion (approx. 15% reduction from 2025).
  • Assumptions: Core adjusted effective tax rate of 24.75%; Other components of net periodic benefit recovery of $441 million.
• Shareholder Returns:
  • Dividends declared per share for 2025: $0.874 (up from $0.760 in 2024).
  • Share repurchases: 37.3 million shares repurchased and cancelled in 2025 under the NCIB.

Notable Quotes

• "Our fourth quarter and full year results demonstrate exceptional execution in a challenging market by controlling what we could control... our Precision Scheduled Railroading model again enabled us to control costs and deliver a record core adjusted operating ratio while capitalizing on our unique growth opportunities." — Keith Creel, CPKC President and Chief Executive Officer.
• "Safety is at the core of everything that we do, and our performance reflects the dedication of our railroaders and their unwavering focus on operational excellence... record grain harvests and a pipeline of unique growth opportunities position this company to continue producing differentiated results." — Keith Creel.