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Canadian Pacific Railway (CP)

Participants
Chris De Bruyn Managing Director, Investor Relations and Treasury
Keith Creel President and Chief Executive Officer
Nadeem Velani Executive Vice President and Chief Financial Officer
John Brooks Executive Vice President and Chief Marketing Officer
Fadi Chamoun BMO
Ken Hoexter Bank of America
Brian Ossenbeck J.P. Morgan
Allison Landry Crédit Suisse
Steve Hansen Raymond James
Chris Wetherbee Citi
Justin Long Stephens
Scott Group Wolfe Research
Amit Mehrotra Deutsche Bank
Jason Seidl Cowen
Brandon Oglenski Barclays
Benoit Poirier Desjardins Capital Markets
David Vernon Bernstein
Tom Wadewitz UBS
Call transcript
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Operator

Good afternoon. My name is Christine, and I will be your conference operator today. At this time, I would like to welcome everyone to Canadian Pacific's First Quarter 2021 Conference Call. The slides accompanying today's call are available at www.cpr.ca. All lines have been placed on mute to prevent any background noise. there a remarks, Instructions]. session speakers' the will question-and-answer be [Operator After would Chris Treasury Relations conference. introduce like to Bruyn, the I to Investor De now Managing Director, begin and

Chris De Bruyn

joining everyone thank afternoon, Good Christine. you, you Thank for us today. and

we interest Chief actual presentation forward-looking this on results will Chief Chief materially. President risks, and are Vice and information. limit also remind factors Officer; could and my Keith other differ contains and be Executive release uncertainties, and US in Officer. Executive may the our described I the Creel. President and to Financial non-GAAP results that if formal Before In filed begin, The The with followed is Vice your you to President want questions on of Marketing Actual press CEO, and introduce could time, and by X. today appreciate now one. remarks Slide our Nadeem presentation John Executive President X Canadian me regulators. It This Slide MD&A Keith in pleasure contains outlined we'd Velani, Creel, measures you here Q&A. the Officer; With Brooks, is influence our our Mr. to

Keith Creel

great buzz because take focus I'm an look Thank the and I we've forward you, us matters. are to enabled to would and where on results, I railroaders the afternoon. that to the address things our I truth results everyone in to actual But about. going thanking the family compelling. think air today. of appreciate get getting got M&A appropriate and joining Chris. Good I Certainly, talk we exciting XX,XXX to results we those approach sharing it truth, some suggest to going very that strong it's those the the perhaps I'm from them. before that’s

where KCS that announced board truth to agreement unsolicited superior in think? And best the market and think facts, up I woke How sitting ago. and well, opportunity does address stand? we and only to the comparison the What And the best tied is only think month react? with offer and truth the those to The frankly, Perhaps unparalleled way undeniable do truly value where to yesterday our sure we that. unique way that surprised? we truth. the will KCS led that's we you're strategic a the to think witness what is do CN’s to thinking, the I perhaps indicate combination CP is the all I'm anything I there partnership we to points all with

as IC a start companies where, surprised. this developed an uniquely company, we Mark as that back does. history. chief in ran XX I my with the Operating answer senior of is Senior my days, Redd, both as alternative, if to for with Perhaps go first at obviously, last if unique career against with there. an the obviously. And I then started with partnering Officer competing ago at in in this I, National Jackson, share week gives experience working Tennessee. partners in experience my our Central with years I people vernacular I is Canadian the career with. started same the time CEO, bit operating So Officer, actually, company, actually here, the the and now as my as that it where the Memphis, on resume his I've I’ve the no, my actually the by years Mark spent let's The my that's got realize CN on KCS Kansas worked network Operating in XX started, in KCS perhaps Illinois operator. And industry Mississippi, the the it's interchanging where both truth experience KCS, think away My Jackson, not with And as competitor, the respect City. and at I

true. that's So

if that this about value think I'm combination, partnership very think the and just them. to undeniable this that, though, truth, this their Beyond through going unique go I you unique partnership, represents

the the only of KCS, class combination is X the only combination STB's true? on that Why without answers true truth new opportunity. with So say the facts with markets, USMCA it competition do CP-KCS of new public Why truth. only. pro reached impossible. it quite get Well, start proposed competitive. with two, partnership interest Customers the is it's many, Number be, the that number that Why number network the the when fronts, and one undeniable? is new introduced. not routes, we today frankly is The combination, that one. combination, approved merits, Based our our this and believe will in It's test. only, possible we that? one, let's Multiple

for with know because Well, in to the discuss topic. wouldn't it, line that's work. I that that's And of a to and KCS single and have KCS opportunity listening concerns enabled The New the conversation. always many the it competition a with but creates several didn't service market, Kansas doesn't a truth where exist have opportunity be it line combination. origin that the all support vision it discussed when of this shipper to where simply in customers economics changes service UP, with perhaps true week it. The be that fact the the the truth that today is wanted Iowa last happened today of entire we've runs. had share perhaps with invest investment the railroad, those in this grain of first doesn't is XXX to City Truth elevator be by miles territory that's a that three, number BNSF, the is CN, be customers, in introduced, and And time better in exist meet heart pro I service. north City Kansas not

the So four pro to undeniable, truth number continues resounding And service. XXX, the XXX-plus, of the that's change. our support overwhelming XXX, number customers.

the Bartlett, that customer filed deal welcome opportunity truth we uniquely the that we fact, is unlocks, KCS' this STB. is, largest supports with just the yesterday In

So zero, to the number and are proposed there combination have undeniable It's when That's support five, speak is of of enjoys number to Truth that Truth the of quality different seven, number customer spoken not transaction quality gain. with plus five, Truth a again, in that truth truth deny keyword. the in from is zero of true continue service zero. value losers, denying less quality, number. level this number. transaction. that results optionality this very XXX only carriers, support And That's six truth a pretty one voices say today, a this number growth. creating of in I any instances matters. unique truly customer enables no a lose And to options. uniquely only

on exposed You've railroads last with that drives number North infrastructure this producing for the have years especially that itself. needed Chicago have today at I in these is in quite think road stand It if uniquely from to Chicago. additional nine, in growth. that we and truth are And key understand alone about in lived total happening truth routes that industry sustainable, Truth And why I light it industry the rail. put led I've frankly them realistic how and think and sake, matters, we I got quality Truth growth matters think in uniquely I've to truth own drives it. two I the off another railroads be value And Chicago. the growth's opportunity unlocks the return. lived capacity, growth investment last CP of for The growth trucks led possible. earnings because and that rail in speaks Chicago. you the profitable, undeniable would two take the understand about and on that, communities truth, three environment of congestion about the a It's lines, Chicagoan Not the eight, it. bottom line never network years, shareholder these the KCS three highways create times. some what's the key Chicago, Mexico live being of enables I'm investment existing the performance. and in creation. undeniable. you the to to through I lines America benefits is number the through congestion comes capacity know that to in

think from that's road entire off congestion greenhouse opportunity, XXX, a the or that I Mexico, in So the metropolis benefit It's synergies to value, XX, spoken Monterrey, or for unique, XX, bringing over about There's to road for that taking on more million that take XX, for realize To suggest the this them that you to unlocks out, so undeniable. populated highway on deal be on to $XXX to truth order trucks to, that value miles, only on taking Chicago shareholders. get we X,XXX doable. is traffic but the it's on beneficial, emissions shareholders I otherwise deal into the represents suggest rail, them would conservative untrue. in and highway and approvable. done. XX, the the put to suggest we've And to or is deal about is highway that that the it of for Mexico got our This from. the that truly not realize City, area, local off much gas yesterday, less Chicago from talked highway heard huge actually Number route opportunity that traffic attainable

to as number for truth. environment across deal now creation more uniquely KCS benefit are job value both Truth truly value reasons all value even those XX, long undeniable value, and sustainable leads well through represents to all to that only truths. path as long that's one is undeniable CP's, compelling compelling by from, This from, called XX, this certainty. Those the to it combination. stated, value employees, true and our For term And created realized represents value benefit the term, deal one areas. the

at keeping proposal. take Now with a thought, now that look CN-KCS let's the

in about talk truth. what's Let's undeniable

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spin routes disingenuous never you'd competitive. or number competitive. if Truth you If the just doable, that of today customers, get How if deal, It's it the Louisiana, that's why many not happen it, an partnership X:X? and CN about who this to Superior, in customers strong between miles CP, I service that truth. truth, Wisconsin options? really How there. many anti the multiple guess Wisconsin man come How Superior, at CN, customers be down of with small, the XX not deal many just UP, it's option? and and on, I I'm CP. losing is you When think, in on. facts Come How do so one, two, us, today, this scenarios? is BN undeniable losses choose that lose matter. two perhaps today, in to facts can't The to not the I who? yesterday alone look number boils are in comments know The feel enjoy many anti X:X opportunity would the KCS

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customers America, ag This to says is represents in happen industry This Number strands this is Minnesota, revealed losers. you an Dakota, The and it's deal less your be truth But Somehow South Green opportunity. will enjoy in matters. you of that and truth, Iowa, located already or and already three, with in never reality out certainly again. because And revealed deal number will if the overwhelming Truth the provides winners spoken is didn't Middle outcry service. the some product. lost the an truth that left are truth it's North creates. history The Dakota, no service anti if come many they you're the is is line our yesterday. deal undeniable a those proposed and hurt. they says America, or the Belt customers, you're This truth truth CP-KCS four truth or more to transaction, numbers picking opposition are once weren't truth be ADM service service because of customers from options? CHS, How CP, single here CN-KCS they're those at truths. The penalized. is analyzed, The be yesterday. are this the

truth I their has your two in be in truth I'd this out in automotive the served it be truth CN of The Kansas at CN the moving creates General Motors, they'd North American enjoys would is The plants line Motors, about all plants. that And US, business think partnership, I CN that talk would four is Let's Mexico. over I plants serve were in and what CP-KCS I single were that Conversely, industry. imbalance. coming the If concerned. markets GM, have to options? if GM the of in with Ford instance or that three OEM General if combine half current Canada. uniquely absence KCS, The nearly is Canadian partnership, Ford, City is Mexico through if truth you're to of were are your the concerned.

Let's talk complete an CN export think and on a The about access the for and route Mexico. plastics. the markets, CN have propane energy, about destinations monopoly have US LPG, They’d would ECP, chemicals virtually is control Canada propane of in for truth market. customers.

the that by or away. to access today served combination the direct Rouge, a be we would Baton are, If is customer in you alternative they also and be and Rouge CN about and to Canadian because Pacific, Baton Exxon, uniquely a over refinery CP-KCS care you City that in That's a own at that's Edmonton line happen goes and you're Kansas truth. located provided

Forest some painful products, there there's truth too. more

is on Canada, they customer direct based control or is model, and this forest Canada of If by truth you're understand production. customer they've Canadian suggesting, that could the flows truth you in know a XX% They that single I enjoy a choose. in line and already CN broad choose The US. don't product served got can the the of In control pick destination boards would markets that. across they're

intermodal, go south north is four where would there is to let's only options UP, three. Now value today: and creation This suggests real story. truth the The the be CN KCS. that's in BN, deal there's

BN, undeniable KCS as truth. With Pretty absorbs the the CN-KCS merger, UP, CN option. the CN-KCS

we commitment unique long the If and them care you're they've and investments CP, and the we've Maersk, that's made that made would partnership commitment with so care to to we us their Cardenas, long the health. control a made access Lázaro about the long them terminal. be which and terminal, the made at new term with Because our CN ports partner us, unique their term term we about would investments with especially and to they've of Mobile, their

capital understand relationship, Truth markets, prefer Truth of if Springfield, about yet, done I they and share truth be are this number is would or are I they think they important the is to be they think number you those combination may these the create. investment. stranded overlap true potentials worse The how know that eight, exist. leverage suggest because Canadian what I probably isolated, homework yet To that I think some suggests it's that not or prepared a They of ours. lot undeniable. that I haven't do benefits to money would environment, is may overlapping go is the need could true. They I this I prefer or proposed number Jackson damage that to the this in think shipper their have don't the not if the many. not material. that locations do I guess care. a Omaha growth Truth and it a they really or to create thinking worse that five, the is to and in concerns they Illinois don't that X.X those about. their truths. they that of spoken be points Maersk, every it in not combination when about Council balance times seven, that And one about in think of go happy To obviously one, heard truth. lack I the again, were some uniquely proposal, of truth be shipper realize St. this this gets invest by growth in that the true. they're don't benefited ag Alabama; Perhaps customers create number believe truths impacts undeniable doesn't would to growth stifled speak the would this in talking sheet, one connection my I'm yesterday. the the either would Wisconsin; much nine, Truth and to to keep adverse and they or that takes wouldn't they Mississippi unlock investment. this proposed spoke I and the to to I KCS competition earlier to chemical and it's up every it's number National point understand, the not my to, served there lack back truth Superior, Louis, by compared think represents the Louisiana, Mobile, about the or to know that the doesn't locking in about to to suggest lumber Same that shipper, to to Truth exist. XX earlier, growth, that made that's lot to to Bluffs But I served miles the six, with guess to of of customers,

to aspirational, conversion. I think pretty rail road

time absolutely, been developing at these We've will partners facts, understand we've I partnership this our John they for but better our intermodal. market same billion the think to to yesterday, opportunities. in the than the time, the Conservative, of synergies. because $X is realistic KCS at synergies think our yes, get number some quite with the diligence. all truth in done we I heard this about at of synergies the of yes. this And have XX% of

Barrington, are Chicago I all over deal, the And route road congest is Chicago and gas to the go its it's be Monterrey, it's think truth direct about were EG&E. Chicago. when to truth I because going is the I would look It's propose City me, I back impacts truths. same intermodal what, to attainable? Detroit. I to get it's the suggest if the or environmental out you they terminal is our was Truth I smaller the it coming there about it Again, probably I part adverse it's to when on It's the to The those the think are it the And just their forward. go would that if the about markets, on to via going impact, network facts over their those. City. had their mitigate, understand which be concerned it's to going a Greater Barrington, network is create area, deal true it is It's sticking in very Toronto. And the with to is in true true is same truths And currently greenhouse to of south It's our is in emissions folks unattainable, value perhaps the those fact. folks Chicago access Chicago. traffic still if was the to would Aurora, if this has going beg created, of know at CN CN's created, CN number it's the off Joliet. it's to to Mexico, that not this the If going it's the The Chicago. that truth environmental truth value. denial, way has It's that know Mexico is population Naperville, was all traffic, the to rail. truths, that I think, value large speak coming streets a The is perhaps that the about suggest the live with same really network and going their other to existing there that the side going new the to Joliet. through in still highway. truths, their terminal you're is Chicago. would it's think a If XX, To differ Kansas you center, again, Even that got going western I think Chicago. let's located put truth about version you of attainable? is and communities, is only Those reality they of

They're pioneers, That I or of there. this don't think looked, this PSR pioneers a not nobody the heard yesterday would at still National. not over work mention truth Well, least They're last the is industry. pioneers. railroads. I all is I there discount of Canadian talent disagree. It's the running they out at anymore. the working

Not to So They then can then, I back can because I different record. years the They to can, say they the our years it can a I trail I the one, a XX, XX gauge it I That's that And the and if didn't thing all years I XX the spoke those of the a current underperformance and I earlier, think game. truth fact. there It's by. That's of team, at, go is go company. XX only I they? underperformance. industry. different but was that's team. And show, the ago, in industry. in to It's track facts pioneers look led decade. about history, industry. And truth. back the have think

undeniable points It's value truth the future I've truth Absolute future of That gold. proposition. for same partners. got that's company, They minded same understand in the service STB, that's as deep pro company, means. to what way. And Like no team believe I've because pro do are feel uncertainty with foolish truth there At what last risky of understand yesterday assume space. had make smart know means I the all to could fact headline They what one a represent the ultimately. simply engaged It's time I attainable in suggest to Directors, And proposed respect. we that at is we value. fantasy the past, then And could pretty the you. not leads is me railroaders, performance it deal enough matters. the truth, of think have They're those decision, money. Board investors, it investor, means. the is said work that the we again to deal they'd an experts which proud in that KCS. And did fools. the So end competition be my real more that's to to as me, a future, XX, the that through be this finally, I just true. day, to XXX% you're ones then the truth fool's the our than XX.

the on they you what believe, you're and investor truth? train story to I to one what look in I most the what think by the do you that by is based you at they've done. probable think what you represents not want if train aboard join, but an say, that's want get

and is group truth value. unique to story going decide value the to decade over we're put Our XX industry. compared a CP, creating your the to story. story you'll where in last That's again, proud have a And times to of a talented multiple railroaders of story we that this company turning of this doing what It's taking around, it's said this at do. a

So that's the my story of truths.

conclusions and save the pretty about are Q&A. for that I we'll think discussion obvious the

other woman It's management, because not our railroaders. now These They're that's enable about recognize that's change. proud not collective about. it partners, historic the or our without me about railroaders. and these I And man this this again. these and So extremely union enable business get leaders, us. It's represents. opportunity it. about this the this the what that that's that about real partners and I That's to engaging, in mean Again, whether our never to or the team all the it's talk it's company I excited truths, our say and just our our We we're want that's over of we've these family exciting let the They to Whether transformation. to couldn't that's ground results. been of on thank going family, that's efforts results. this are just do results over leader railroaders, railroaders, they're of excited this They're excited. of

So to these results, is this in the again, pretty I unique industry. truth it's think

of performance enabled XX.X%, up First strong and strong operating quarter pretty X%, job. adjusted a It's done phenomenal performance. team it's revenues EPS impressive. $X ratio a billion, operating a adjusted of and an Mark his have by

efficiency assets If -- spite for an levels, PSR culture details, finding new creating an what look levels our the in the that's new into true again Optimizing polar you links It's even It's a and says records of of not vortex again, essentially our enables. went the truth goal. weights that we operation, of outcome. aspirational through in February.

and the to to job. then And to Nadeem to discussion having markets. I'm forward done going wrap with stop to So up point phenomenal they've some And on us color numbers. look on John bring to turn again, a you, it that a the John. over color truthful, will frankful we after. at Over

John Brooks

Keith, Thanks, right. and everyone. afternoon, All good

So the by saying pleased very start quarter was let played me out. with I how

us. weather conditions across for Keith demand all winter February above is super to business in shape excited this than time And strengthen. spoke our and our frankly what lines on to up was going was The record challenging January significantly I'm the month environment in from I to coming more most came that of be. and high continue an expectations, March Aside excited QX year out to, of

and QX, us. for environment slightly fuel currency I'll our a basis. combined positive strengthen pricing were look results speak commodity the to looking revenues take were quarter. for a RTMs at the performance about to X% down at and So headwind the Total FX by a in X%, specifically adjusted continues on and now revenue here

XX%. up grain, XX% volumes So with starting up revenues on were with quarter, the

this the This the assessment helped successful update appealed our So Canadian quarters. or marking supply Agency and capital methodology record every partners execute crop chain and I'm was cost Canadian on straight for And provide XXXX, operating index is grain quarter our the VRCPI. us which that exceptional and Transportation an month proud in volume for index set appeal, the it were grain pleased reevaluating team of incredibly record XXXX across place that composite a also six in the in us, their price in I'm year. the network on VRCPI. and of QX changes had performance. had deliver we to this related taken by is we the the the the CPA entire

that about expect change at negative assessment the negative for original of to X%. in current now X% to the to year around a X% We compared come crop

strong franchise the Again, On closely grain our another the market. US front, great the to operating customers deliver US demand. team here to grain, with working story, robust our origination continues the see

Our RTMs for seen years. strongest are some remains Demand steady up export over we've the to and of in the XX% P&W year-over-year.

the border quarter as through grain deliver Now two. declining dry looking steady volumes despite of to stocks some and regions, to continue areas continue some both to conditions we in in move on Canada forward, sides expect across I

ongoing drive capacity work volume tell is a track On this I as through this X% reflects completed. in front, expansion Canpotex on at now working with facility. terminal were this that's decrease efficiencies The of will We're Canpotex's increased been you quarter. and volumes impact as to volumes work some the potash the outlet. new Portland the closely down export can result

tonnages while deliver the the potash as I XX% to and to start, see And business, off little Although were slow X% were for had chain QX. remains to a April out revenues very we bit extremely in up occurred close of an bulk the And opportunity well up port volumes coal here is XXXX. lapped record strong. supply potash issues QX a for still executed maintenance in that demand

and and energy, portfolio volumes we merchandise the where front, decline about plastics On to revenues turning chemicals XX%. saw

export domestic Excluding improving demand crude, by up were and the driven X% in for quarter, volumes LPGs. ECP

in continues from demand area to this crude, as recovery more to expect levels. strength ECP continued We in and pandemic the excluding see returns the normalized

In in reminder, tough QX pace moved As QX we and comps. a crude expect volumes by in continue improve as we crude X,XXX. gradually moved the saw move back of QX of carloads into QX then with XX,XXX quarter we the to the we similar half I and last a crude to as about XXXX, XXXX year. at into rail was

prices up revenues were strong QX we paper as and metrics for see up significant Forest demand X% and were products. continue to pulp products both for a X%, volumes lumber and record

MMC, volumes our fleet, volumes sand recently drive added trends of We XXX XXXX. have declined continue by driven lower will the to which we move positive beams declined as frac revenues center result to through reduced as largely In a about XX% XX%, drilling. and

were Excluding frac MMC positive. in volumes sand,

the for able up excellent front, impressive solutions the is again, an quarter, revenues the we've create power an up of customer the the to were On were XX% automotive unique in while And XX%. demonstration this OEMs. area been volumes of auto

with the OEMs While challenged demand focused those are lines. by which manufacturers most chip have manufactured shortage, vehicles recently we on our been with high on our

volumes production loading impact continued to some expect rail the next few over and weeks. We

However, grow at move space. we this for current strong to improvements a grow auto forecasts to in expect to double utilizing future opportunity show holdings customer our and the pace, I in see further revenues continue May. digit I as through land

intermodal the on quarterly X%. were down volumes side, finally So

Canada, On the time front, across consumer strong. a demand had continuing month. March despite be tightening first record we all related COVID domestic was intermodal we And quarter. record see an restrictions to

We that a Canada's relationship our and leading pleased Loblaw food with contract announce pharmacy to provider. term will long are with new expand

and to offering a We international for Canada, us for this competitive seeing Atlantic strong to growth highly up domestic service engine look and are years come. our into service ramping

our So while port this to to port exclusive the We to international with accelerate transload volumes continue container franchise did improve shortages contract. St. face we Vancouver as some challenges lapped ramp online the in comes and with The continue O&E Maersk. calls expect up and of here John QX. we O&E comps, and congestion

all marketing close I said, and very Keith business, lines build in customer marketing environment. let focused solutions delivering opportunities assets those sales continue that My playbooks of our of executing on and see underlying generate strong demand unique saying opportunity our laser that So across team and as and forward, pipeline optimize land growth. of me remains that profitable by looking I remain the specific to our sustainable confident

it that, financials. with the over turn I'll for Nadeem So to

Nadeem Velani

to good Thanks, proud I'm afternoon. of John, and results, ratio highlight a XX.X%. record CP present our which QX QX for operating

model, accruals then navigating Despite record given environment. an in challenging to weather, matter execution of the Our negative no the stronger once abilities the the stock February fuel time all rising by of these proved resilience results, delivered which and a higher of exceptional excuses Canadian month to conditions opportunities is the plenty a and team what dollar, impact producing CP's in March. testament record their team again railroaders of make the comp strength and prices,

decreased of Overall, the $XX $X operating ratio KCS that weights a the by Fuel X% higher Chicago. million the a services million in with today. I'll agreement million, prices. train exchange, Comp driver compensation line as transaction, or increase and quarter. primarily decreased based items price train basis a below the including note from was strong $X our purchased foreign the to by other of expense. stock higher XX speak costs to the primary partially XX.X% to higher You'll a of expense recognition adjusted closer record at result of million operating other million versus expense and X% gains in related total tollway was share points adjusted The few on by of driven the the the offset efficiencies, lower driven adjusted lengths side. last $XX we for and results $XX pending year. and transaction have a benefits and up look million in in $X a expense or Taking

down X% a of in rent was the in continue base. impact and improvements offsetting we Depreciation than QX efficiency in million, Equipment $X improve a quarter, expense an higher million million as expense $XXX income of or fuel contract X% quarter. asset increases The from to efficiency as negative to our more locomotives. operating record operating modernize increase as wins. result result fuel a prices $XX was automotive year-over-year, we a of performance change This our achieved rents was

$XX purchased of Finally, million $XXX the decrease closing the Again, XX%. main related services of was decrease million, to the driver the is gain or a tollway transaction.

periodic as discount Moving of or decreased $X quarter. Income Rounding income effective was grew result tax X%, reflecting related in million, EPS X% below the a lower to the out as the to million expected, net a in tax lower components line, decrease of benefit expense $XX rates. a adjusted primarily up interest recovery costs other rate. $X.XX statement,

cash, next or the ops we million. free from in flow cash slide moving with On XX% increasing strong to $XX cash QX by generated

the XXXX. in our billion reinvest to $X.XX to continue guided track are We meet spend on and railroad CapEx for

capital volume XXXX incremental John efficient to available the volume will we capital allowed by us XXXX, need shape and to team highlighted last saw the from in capital That engineering spend. operating The to our in when forward decision in won't fantastic increased Given time. resulting strong solid the and we has the benefit network robust the pandemic. team demand softer outlook outlook of from work track decision year the capture pull advantage our take execution and the

share X:X was by split approved at this morning. proposed Our AGM the shareholders

will liquidity enhanced for steps shares expect by CP's provide implement common in split We of complete to stock The a opportunities May. taking group wider greater to are ownership and the investors. encourage for share split and

X.X Our of strong debt EBITDA. balance adjusted sheet net leverage with to remain very adjusted and times liquidity

environment story. and I it We well into is lot brought QX. leverage commercial momentum turn are credit the quarter today. back that, share continue guidance range remains our fully convicted a to feel With and short self finished to investment and before help program have set We by with to strong term we down of excess up out our paper our buyback in January pay we cash we paused, set get our things led The committed target over wrap and in Keith demand ratings. up into to reiterated I'll grade Q&A. as strong realized extremely

Keith Creel

close undeniable. So I They're think for themselves. with The I are I'll speak started. maybe results of sort where

that the tough market I proud of open for especially industry up we think challenges environment, that the the discussion. had, I last growth enabled result the all given a compares says, by overall team, X% it. with compares extremely it enough think and let's very faced, said very that year a same to We to And and in some in of story. this year-over-year for our the the faced, against unique I faced, this XXXX memory peers remind that, be we toughest truthful I'm in we

Operator

from the Instructions] Chamoun Fadi comes line [Operator question first from Your BMO. of

Fadi Chamoun

explain time I appreciate the this piece. taking the time and through to

what customers, ground outlook? feel you've do So upside feel quick this here that understand multiple there your of little And synergies, what you you do weeks kind a synergy now had the question is significant maybe on of to about to kind on to a that that initial the talk means. were? maybe How more bit expectations

Keith Creel

create teams beyond our assumed to in Absolutely well these what together understated, we deal. two -- overachieve big opportunity for

Fadi Chamoun

quick going see the of it and end on down should customers day at this playing come feels the mind like STB's a sway they to maybe may ultimately, that. heart wins go. to just to maybe which that how follow-up mind way And of Like this out? the who Is in we're the

Keith Creel

trust I you're comes the the and I it down embrace if deal comes the or realized? our deal. comparing customer But want when gets Because Fadi, shareholders. test, about or think I'm to unlike who with going say us. CN have that's its not. so not it trust, I've so The truly here. STB under in pass the that, is why risk get truth not only done, their important. is the undeniable. the critically one realize believe there's to by of the feel overwhelming new the myself The approval against for serve, not, approved Well, you The obviously choice CN CP. going to KCS for to STB complex the it's into has can't uncertain. the whether ultimate just and voting uncertainty that answer good to tried put the we doability. have customers -- that the that their it's It trigger trust with can as and to your is regulatory to you, its are STB not down the deals, I down that listen Pat’s to to, is customers about trust their is What of is CN which is be That's truth mean in if deal process, deal seat, try the down seat, you public can done? It and that because to no meets the be test, myself rules and voting value interest new along one. test proposal to, the KCS value to And but comes so can Directors Board of two, myself out to truly it put much -- I part go comes put whole comes the shareholder. it And to Board down this will

Operator

Ken Bank America. Hoexter from question of from the comes next Your of line

Ken Hoexter

your just volumes, given we improved talk if your economy, outlook for maybe focus could now just on about it's or on maybe John, the I Keith, performance, guess.

changed? you outlook about You Are in that upper single acceleration seeing Maybe that digit don't in if updated in margin in well. had you RTM March? performance I What's to a that the team. given know throw just growth. want though exit talked on and about more carload talk to maybe as

John Brooks

digits, and extremely got we're single the with jump launched. I marching. it's there directly convicted was others the high in I'll January super pleased take here. that how path let still is Yes,

this to then And to little to Of move strong, last situation. all KCS for to blip of I business obviously off some The certainly But industry a talked over of struggle, about the convicted. We're I I've start of recovery but opportunities, in be well. see watching us spoken expect part, the close chip chip and weeks We're in recovering. and course, with see April. to again, OEMs bit to of the environment little with out I as expect merger we of shortage. perform good strong most bit continues couple a And all think the the QX here double lines QX out the just a digits. that. a February the remain across be year, this was certainly most [auto] about around

Canada, to QX. So but in to of I'm really here grain a be stocks nothing front us. optimistic in the areas impact certain bit But We're across strong starting of us that. see for continues in maybe dwindling see that would little I

remain So there. I optimistic

the we in moved said, tremendous lot forecast Canpotex that opportunity, up As pent demand And XX%. in the of QX. Ken, potash I is space. a in actually, been There QX up versus what has are about

the up, we're business John. around on side to weeks release coming Hapag-Lloyd business. you ramping is know protocol going of press first to here their the see on there's expected gain in front. And a the Maerks that lot what, into where of St. a So momentum opportunity only is intermodal

into As marketplace I business spoke intermodal domestic ramp our is up about, that too. to starting really

that all conviction excitement still XXXX lot of So say, what on to holds. and a

Nadeem Velani

comp ratio of terms we'll challenges well. it. have for prices headwind an overcome we're headwind XXs extremely that I of mean industry the side, fuel to that in convicted. We despite Stock talked issue vortex and Ken, been on January, in pace that's for a polar a obviously, for still And But was we're in not mid and margin just about, the a big that, the getting February. on operating type us, ratio creates. QX the operating as tough overall

headwinds. path feel double have again, that we more we're worried even about to nickel. a hitting that So not convicted I potentially

Keith Creel

could today, we it's Ken, through snow, see bit the even Yes, sunshine clear. the little it's of it, a the

Operator

from Ossenbeck from line J.P. You comes the next question of Brian Morgan.

Brian Ossenbeck

the bit if the here? that Maybe your for even a up about having perspective, trains maybe side, it just But how that bonus? capacity you then more more potash can just back? for one really both the demand Can than the think, can length working some comes as pretty at just mentioned. projecting in you you're a you gave just network the from have since you to is keep confidence and obviously, from address count in head you capacity growth hiring Maybe pent with the is size volume December fundamentals you And here. stick those talk that and John same big numbers

Keith Creel

at first productivity to productivity, which your about your not in say is And and weight, train even the on starts, productivity. Train capacity. is got being drives when quarter I in I what that comes has that go what costs. have drives length increased. and crew crew different per given did your that We've answer we size in we Productivity in crew all second it already. I'm yes demand of weight quarter a be, the length concerned an employee, level back look had RTMs train to the business, starts, obviously to we the higher that prepared leads space. locomotive surpassed has assumed for would history, we Train increased. environment locomotives if be crude

in have we So that back our pocket.

that's very comes to careful under-deliver That's We on not an railroad. and we But -- and have that. it We're value control it capacity. value Obviously, depends destruction, when creation. comes, not not careful overcommit it on resources and are our issue. where

Operator

Suisse. of Allison from comes question the next line Your Landry from Crédit

Allison Landry

sort your up take view needed regulatory bid? Or could guess is risk? and come bid? because you suggested investment unwillingness willing comment times by are mean to Should you growth X of CN range locking leverage, we you that as to I as is the capital your be CN similar to, around CP to And synergies. the initial at don't that a a I So need of capture that interpret to closer leverage raise that to for that up to Keith,

Keith Creel

I powder Well, frankly of the it's And at don't for go use our balance the to a It's hypothetical have question. it that's When kind this concerned. that's fantasy I our speaking about I was sheet as to in point. a It's to. think not don't just ability in our you all capacity far a to real I I of I'm healthy situation. That's X.X last to to right a don't to believe think honesty, put the to market. shareholders And proposition to alternative. shocks leverage, respond land. take speaks deal just answered what place with is that just at it's risk, because think as to our not our value all true

my considering it's would that be So we're all. nothing answer at

Operator

from Next question Steve comes line of Hansen the Raymond James. from

Steve Hansen

your got on growth detailing how prospects scenario feel the your in with having clear prospects do that Or a of absolutely the just I are Keith, is other Yes. view still otherwise? the last crystal absence you get you of the response you essential mean as growth I you to deal do like on shareholders KSC? this lots comfortable feel question, in that go not mean you outside way, the about it? done?

Keith Creel

value the Obviously, it's without create at the demonstrated to unique creation success, it. that we I think our deal, would it value create can We've we've own story. could we our create that it, what without capable We've suggest X done compared But in be got say disingenuous resiliency. this different that not suggest a very its least. it's to that. going railroad not. That'd Canada, would outcomes. I'm network shown to has I

and States, the we've to grow responsibility for get to and unhealthy create options a that shippers. you changed space. Then our when the provide in value way obviously, Now very dynamic that got in a

those. we So We've about those. one those. honesty, complex look the that it says comparison, truth look about scenarios hypothetical we've with would have being even less suggested to we you are potential thought in History suggest in that's the perhaps alternatives. And all them talked KCS. if than says And those considered by CN at at

Operator

from question of Citi. from the line comes Chris next Your Wetherbee

Chris Wetherbee

bit. pick discussion bit years help several little I sort past potential Can little that sort How is the that less a a If that a of you Keith, Obviously, could there up ago. think maybe about you complex of us elaborate there. could on a of terms just transaction? has alternatives? in been in

Keith Creel

math. simple it's Well,

special going alternatives. CN-KCS all to these of going from unique combining suggesting and I And Mississippi, not the think And our think can what this pro-competition and a committed and it's pro-service frankly happen. that And East either in it's the you reality. deal. future, I'm I'm This is us this and the exciting. overlaps. bunch spoke with scenarios Railroads that our creating, some represents that the I all discussions. will are with hypothetical I run about and to value this versus necessary. be proposed so the is This to quite be is to And

other alternatives. certainly to. I'll think So And wasted that a a I that we there's looking and to I did hypothetically, where lot time those don't to think a I have responsibility be get haven't we'll of made But have. we at point if case

Nadeem Velani

And in Chris, X that we'd be smallest scenario. the class

Operator

Our of Stephens. from Long Justin comes from next question the line

Justin Long

the from see to synergy geography we there some Are around some what on target month can see around guess a And where detail anything customers, wanted looks like on that's group? Would laid opportunity you by that. overwhelmingly is can or the in opportunity some more the collected feedback around in of I Just I color billion? it's of more talking the Is positive. that commodity ask you've incremental synergies? particular that. commentary your we out. results to maybe the upside as about or you've conservatism. side share terms it $X the that love would closer the last errs of Obviously, so you

Keith Creel

to and locomotive on gap car just can going to world, miles productivity look their will speak at a and the a the going I it's our growth tell become gain on about And about I rationalization. Think this creates, I the trains. I John productivity. side, growth. capital information, more that longer isn't if public productive. I or to And there's took it. side. a run car close day. and going cost-cutting about compare We're to But cost this without and last is opportunity week efficiencies locomotive let value heard more become about and This we unique numbers, very to locomotive [Sammy] this per on create think creating look fuel-efficient But revenue We're going can about gain conservative even close expense. We're on you and alone, now capacity meaningful to is efficiencies in value mention I'll approach. the all that's we call.

worth? do. understated, lived substantially say the that that's more value million by What's teams it side. by with of and that again, And value. and still to just create If shown having And is us creation you value revenue allows have X takes that capacity efficient. the XXX-plus lot record driven of a add of a of been apiece. are kind grow I'd experience whole material These things XX%, locomotives of takes work done synergies I to do just talking because execute, hard jobs blessed for the just track work. that You're it ability I've locomotives? my to instance. pretty and that just the believe and one math, XX% it about what's that's It becoming and created that having we having with, It and don't ability happen. an which to XXX

on don't So comment synergies? revenue color more John, you the why

John Brooks

Yes.

So We're of Justin, been I've me time at a the my say I lot that all sales foremost with out, those career, looking But product conservative and working it's let being and But much to those KCS to the reason. think X the say and and I laid yes but to I in areas. would spend first to competition you, that X or going in than as to the for folks achievable. personally involved our synergies a would be certain going railroad opportunities. bite we've to certainly, let have opportunities. done I characterize also is more that conservative, tranches know marketing tell clear. all have just those achievable, We're back synergies realize in commodities. realistic. We develop they're with we've

automotive place. of on model out add combination space there. that XXX we on these take alone opportunity as that going you this that take hundreds to fourth number today, trucks play working Is customers tremendous It's on Keith There's million? earlier. it. intermodal The our route just CP-Kansas grow auto City the see opportunities to opportunities our that commodities. that competitive industry think is not utilizing it never also if, and a the month achievable X,XXX-foot grain XXX existing road across over It's I the doesn't for the to it As I've business, North-South. in be There's in spoke there's Southern all will opportunity last on opportunities a huge to the have fact to synergies, CP. It the customers uncovered space that Certainly, in can The opportunity. spoken itself. I'm in imagine, put opportunities in product, and Is investment ag themselves, be. a KCS could our And but network existing the certainly million? with not just it's

laid again, And weeks. customers the I'm over opportunities have X to excited numbers these we've achievable. are brought the about very X last feel the So forward out I

Operator

Scott of Research. from Your from comes line Wolfe next question the Group

Scott Group

waiver then still Do Keith, if of that's offer about it's question. they sure network cutting So whatever are And Rail there more overturned, a So day, night conversations CP you if your further secondly, versus you that isn't KCS the deal things last So there. certainty why reason think versus perspective, deal reach? deal Pat even night-and-day so expands share in or with a and few one another? for for just X from that one trust Eastern I'm your do think it attractive? achievable, theirs? Is voting is a is the sort the view days. had And you've Board then

Keith Creel

come back notes, I'm some I'm for on you that. to make Scott. to clarity some going to on

unique agreement. looking end CP in this on the in that. pro-competitive, unique one think partner, Rail, So we and on have transaction the let I'm looking East? I'm on one me value. I'm start focused last. simple, Eastern not with the pro-customer, focused the an and only to not I'm this that would Why East. I'm industry creates focused I KCS. pro-service,

in looked So focused in. or to their and partnership unless to believe their and differently, that's weighed of both pursue a facts about that we're we I've deal I what to decision, where at until decides spoken we're truth Pat. that moving Pat, made have spoken they've exactly We're -- unique once Board to forward And value-creating the the on. course, to in speak this

From So as there'll Board on value enjoy creating we're CP's that anything, about with customers they that's a Pat employees. KCS's They that. key shareholders our than this. our principle. our part that's uniquely be to the And as the discussions well uniquely in and the no for We get what's unique and when value as other value, see very see well the about as been beginning sat more It and unparalleled. competition. talked Never transformational where uniquely, serves growth be be this something in It a the the down, be way. that checks mean, Scott, a this serves I we commerce. and at employees. serves boxes. how It It serves enables needed all could serves what unique time it's about will customers. that how very something this the could could It

we So don't the consideration. about what first your should it And about. overturned? that excited And so to be get question that's we're point of then special the gets

I then even best one reality in our agreed the the the the Because trust been one think that's to that of truly interest? it's only sort test. and boils passes compelling. trust. it And down combination, value makes there's more only the Is that public's that is to

the The other my facts. in could view, in never approved, assessment, my based be on

DOJ's these is the concern compare in we don't and deals preserving But you letter trust. with they the about It weighed necessary. can It's of You our DOJ. concern, necessary. about difference. a institutional the debate #X opine about why There's overall. industry. KCS. in DOJ can competition The compete But and the absolutely wrote is on part facts, you We about when trust concern it's think while in the X compare their its that they

undeniable that's a to end. overlap. if end truth the you fact. So get There's line, no We're bottom the is to

we'll it's they've truth today, other about CN and They KCS Now haven't, proposed miles the which they of trust, that they compete. contrast the all get the they those undeniable compare because compete. combination talked suggest and in compete trust, locations that XX would to never compete. the other on absolutely and I

concerned a So It's really that, that it. that approved do. if simple. about suggest if would competition trust think Scott, has are how basis you just really be you're sense protect missing anti-competitive I DOJ you to to I the do it? I an And the is allow And people true

Operator

next comes the question line Amit Deutsche Your Bank. from of from Mehrotra

Amit Mehrotra

CP for today capacity that driver the industry, need Do had and entity the and tack in of one you the won't related we're the consideration for or importantly, ago you the is in this an management capacity other there -- Is of of do for now be STB, could in you need there would years And the be When on at just I hyper-dearth but think maybe driver team? the the if you the given important dynamic the fluidity other the to majority shareholder by to terms that's demand question that a you? said fulcrum resulting of look would big point-to-point the improvement capacity? if think consolidation. more for and to how Keith, to, that. you the point basically that need further that be would just at a out for need network. from consolidation the look And of little alternatives, alternatives, comes CP consideration that you and at relative more

Keith Creel

And in about, so it principle shareholders? to we're is shareholders? combination deal fairly value of share? do obviously deal for evaluation consideration when any we're our excited about. the ever that in it that was comes My consider, would talking -- this to our create CP in this our I that And Does we fair it our

Chicago. context we enough says that all point operating Chicago. that or as that capacity the years with years back in says CEO, only there had At I railroad as that X. PSR. and there XX now model go creates have competitor's years railway. and one capacity adopted created one into my Years years X with in I X some wasn't but railway timing you And seat creates So to was or that XX to thesis operating naysayer's an was this let's world, capacity back In a ago, safe have to And creates to operation. go and X matters. capacity value both study, the again our is back the years, infrastructure back reality railway. deal create additional is whether contrary officer in flow cash this to there in rail to, sustainable time, as And go long-term was an opportunity to that case create invest belief in Years ago. in today's at as sitting the ago, initially well -- a

I So Chicago, infinite of it look look drives consolidation? a it there's didn't in as sit But at thesis does today I delay because capacity and have Absolutely, Chicago. undeniably, yes. we it, been it of No. at I lot created Is capacity, capacity? that

to STB a of think for play out don't about that's today. think worry a don't discussion need. I needs the So capacity I

proposal argue, smallest they would think standard about track mileage miles. goes what routes, be talking about U.S., discussion. does talking Yes, is would a truthful absolute this isn't about North challenge that. balance. This Unlike could than that other that that not you make gold still is imbalance the smallest is you you meet to the minimize this to think that of hurdle And this not. again, networks. answer Let But This threat a the to the X competitive to railroad. the American This third will it is it isolated fundamentals How would This it's answer do submits have I with deal, any it to we're or a to compares? railroads would commerce largest the can railway. discussion. a is deal We've We're of need number of this. U.S. exceed, discussion. threat a deal, of be The but one. the is question. combining, got it undeniably because create doesn't them that be, perhaps a X-country the competition USMCA

importance of connectivity the and and on that the little one truthful. that diminish a focus of not can't You piece. That's isolated just

be true they're And at to in matter. So to again, because I think and true. that I believe facts to they -- shoes and the going looking and going facts if today true, care carry I'm I they're it's going will. the are STB's to argument Those were

Amit Mehrotra

one a very talk talk that the a alternatives, we rails. Western And penetration about terms penetration there's lot the further in alternatives CN-KSC you into of in those particular one And rarely has very there's a Are of but the Eastern to about Coast Yes. rails about good as possibility Mexico. think merger, dynamic -- of as of of competitive the of kind being kind rails? West Mexico in

Keith Creel

not would Yes. if ever that one I consider. It's it's possibility, not a

answer So that's comment just I hypothetical and hypothetic a question. probably it. a on to everybody's apologize. be It'd not interest

Operator

question Seidl from comes from of next Your Jason the Cowen. line

Jason Seidl

on risk and Can a to shortly to of there the potential said numbers seem just track. CN-KCS plants some overlap going that's there the you play? quarter, us job come on transaction, Nice where in up counterparts X everybody's if this on are sort at give you transaction of, more transaction believe I many X you how mind. Keith, were Canadian behind, in to miles there's XX only believe, I'm customers certain very focus, that in but obviously your was the lot shippers

Keith Creel

But combinations of I John, while back Jackson, in would back can said think used to Railroad, facts been that IC XXX it. over at You the earlier. I my be as XXXX, I make to master Mobile. I didn't by a from the go of covered me today the train CP-CN earlier, -- you Like know ago, ago. I And And reality. Mississippi down real to up was in just Memphis, what on years I and reality that that There's know, look a XX be said let number. is The Memphis, don't Central to some impacted Illinois XXX -- probably I it's Tennessee a on then went Tennessee territory that.

people I in suggest show deal I know this I understand then which ignores Mobile. ignores for port. I today, serve I know Baton very Mobile. it's I worked people. I lived true. to Orleans, are today, isolated have operate understand space that Go New be the say the of towns. exist. on lot that that will know or into don't railroad, operate and be customers' Gulf that I KCS to can City the that on I I to that were I sidings. the it. customers tomorrow, disadvantages, know Mississippi even to to early the in if New know to the would industry. rides down that Destrehan. just X the Jackson down approved of crunching, Hattiesburg, suggested lived I now in To understand in space. line the suggest there. South would dual as understand operate Kansas could I in options, I tomorrow the in Mississippi, down single that I better, that, Orleans, coast the a those pain New also from lines be reality. will KCS’s IC going down it than worked time know be to number facts get because served an to Rouge Baton competitive I I there. this Rouge, know the I business, the that well, going those to It's again, to to the not the So ignores KCS to many the Orleans, done spent opportunity served would and it. customers. if the the business.

Jason Seidl

color. that appreciate I Keith,

on I this there surprised bunch of would pushback you guess your wasn't a potential so based combination. if be And shipper to comments,

Keith Creel

I an -- surprised understatement. be will

Jason Seidl

Appreciate enough. fair time. the Okay,

Keith Creel

I think time to might will be opposed show quickly people you very this. how many

Operator

of from Brandon the next from comes The Oglenski Barclays. line question

Brandon Oglenski

there's you that. to is lot spar short, with interchanges not the go instances to because want talked to on you guess I did trying -- down to got South. was Keith, shippers concern when about, So options get from The leveraging then here ability the a say rather another a I'm block And deals say physical CP where the you'd ability go in the any to Midwest overlap for market? I But Is the you those option there an did their Is of up in X X. maybe real that what's that way. in follow that interchanges? you let's KCS through, ultimately

Keith Creel

To difference a block the an interchanges? being There's and between interchange a blocking friendly interchange.

week. our We going rolled primary partnership in we're either We imagine into be -- spoken suggest can't in to friendly went which It I and in reality. partnering imagine eliminated is to not think in did rate So a as being Pat would combination and I going and a where I I colocate, world competitor, operate. come a our red Kansas or was we've out, City the it trains, for had not town today. or actually that to I can't offerings to honor employees. customer wouldn't today the our carpet agency good with as it hall. met this. actually their Kansas where of and crews we would yard formally -- world our friendly joint be we last be is received into any our in City, with

a Just not realistic not possibility. just

you to suggest way game you today, would go I if that So will be impacted.

John Brooks

Brandon, comments. I'll add Keith's to

if And Mexico. Kansas into of in lot would I get one loss about certainly frankly, CP-KC There's out provide coming a very it out tomorrow, single terms opportunity a shipper loss -- of would KCS a or Edmonton. -- connections Just line shippers. -- route compete shippers think a up the the of the I'm versus there, opportunity to a -- of region to a to get have down those direct on an of do CN propane I our the I with having we of that route, haul that would City concerned business of over of where those be gateway

Keith Creel

principally. We We CN grow. important. that can at desire, stronger. competitive And and Competition reach makes word Don't out. try to it is us. aspirational to better. it damage it that us it. good. I our they think Step railway. or is it's just go markets with It be someone they Why so better. And makes not they a that it. think to healthy. That's away. because in market to the it Don't fundamentally and can of create for they better. That's of to We industry you will alternatives you makes think it? space It I Don't that's our makes That Or then don't think either. us able think an to this new buy welcome agree try can. make don't afraid into better. create think goal competition don't being trying be make We makes just snuff compete competition eliminate try it reach. to customers We try better can to us it customers

Operator

Capital Your from next from Benoit comes the question line Desjardins of Poirier Markets.

Benoit Poirier

about pricing, capacity? in about about Could coming fuel bit has bit the FX? and evolve yield the it strengthened pricing, to little of the how a light whether little you And tight the thinking talk should mix, given be business the a we quarter the in

John Brooks

John Sure, Benoit. I'll take here. that. It's

what, know I tell that, I So momentum good QX pricing. you saw of in in can you terms our that accelerated. renewal

continues changing I don't I to those upper And frankly see into to QX. when of have X%-plus-type talked that that I we that accelerate ranges as end say So those think numbers about.

FX As year. I headwinds we see of think think begin move we improvement those continue of about the sort of you fuel as to through whole, yield as lap and or sort a and some to

and kind On damages. probably the that, speak that I'll back ultimately sort flat the of And front, range. of that sort the of coming itself through too, into I of even see I more to liquidated improving a bit that mix year. little And think moderates

I some see year. RTM as overall, we half move through for gaining the back So the of momentum the sense

Operator

comes from of from next Vernon Bernstein. question Your David the line

David Vernon

there? say with -- it's or to Is the trust your for do? whether expectation evaluated and grant, under want to on going What's terms about being anything you deal's what voting there's rules of Board is separately, going other STB just structure process be out offer to trying and the or -- the I going be your out to do transaction waiver its your -- process to is your not sort the on there? going depending under or a be STB in ask Keith, forward alternative get question. whether determination waiver is reviewed expect while for come to So around out of this proposed either in case lawyers them not this this moving from kind sense of the to hearing competing I'm you're just a while work this, what bid a

Keith Creel

be the words on I It's think would I to may process. And predict it. STB work ill may your best think in it my describe do. what or advised part not

is the work Their mind we carve-out. And CN's ultimately that proposal compelling. there. different think to that The And the is matters. truth STB know facts in no It’s believe that XXXX X our has think them. carve-out I facts, that our we're was decision. X that make I And my enabled that believe of different very the what in facts true. set the -- final our And I bearing That's matter. be that it to facts going stories, was I facts. will believe believe I specific. I supports the continue created, facts combination case are in to on facts. with and when

David Vernon

just kind I If of there. follow-up could a on stick

that you sort of a not in be how of competitive for maybe your the position to be look just into? deal to at Or maybe would looking about not traditionally you could facts that the this like the potential now the are some do right those it effective? that remedies to for pointing situation of that address do? is that table Like of that harder would some propose without remedies that Canadian would maybe those some Is things make on these and National of Some concerns. these issues complicate think prejudging it you're

Keith Creel

positive pretty a on of negatives. X our Zero, X There's no service. zero It's It's to no to simple. all focused new There's X. is pretty numbers. no on It's facts to overlap. no competitive deal. opportunities. on to There's I'm positive X. end. undeniable X It's It's number. There's powerful end no There's the X. all

on and I what it comparison, I facts those to represents. and judge facts just determination. I'm their relative folks. the even in And their So And that I way again anymore. what that's view it's the very to the group and comment my other that are facts, abilities. deal I've a of that ultimately, capable and process job. told based those the they're making on. in undeniable. And you In professional in true assessing assess the talented not capacity STB's going truth And their complexity of have faith They're have faith is I

Operator

question UBS. comes from from Tom next Your Wadewitz

Tom Wadewitz

look is obviously and regulatory you heard say, why deal. think Board seem trust think stronger approved. Keith, a sides the would it at to KSU's shareholders believe is a compelling to choose voting for for you've both which given for approval framework I us hurdle And the that I've pretty CP-KSU. But first you if and be

I So to simply approval struggling with guess their wouldn't it all KSU money. why with is that the choose trust voting a and like Because then get logic, seems me to I'm they they need highest price? shareholders get

bid case, leverage? with you raise Or if balance shares that do just if out you wouldn't that's taking sheet But So raise of instead the that's it the know why logic. bid? and you would the don't I reasonable, with disagree if

Keith Creel

trust deal those that we never all questions, because with Well, certainty certainty. latter to stops approval it get Tom, all and with

STB deal. that Our their the to Board value, fact There's the our something based That supports on or get on established. the that's approved, supports Directors, concern represents ability would which trust their be. is trust our will that get being deal certainty concern ultimately the in not achievable. opine of That our fiduciary to the next to

Now articulate suggest when to put don't and you If at an believe I the if to on on don't shoes, they Unless that. side other that and the on in to get and interest wouldn't deal on it, how at I'm of and meet represents facts get fence. view know realize way can't might the clearer you And care public ruled The its I the any much their value look don't don't STB, a I it. me, looking myself uncertainty, can't fantasy. it. other opine I to based just I I that's the don't facts test, It's that value. you based believe facts I on by believe that the support it. inferior

not facts truth the and So It's matter. achievable.

the value. to you get So never

at So we're zero.

Tom Wadewitz

Okay.

that that's your a much so you you approved not voting can't CN, approve is be merger can't think point with And even but trust. point. that, guess your the So I

Keith Creel

don't consideration. realize the the review would trust to get beyond don't consideration the and That you And get of their get the you realizable is substantive shareholder to approved. when is trust the trust. merger the KCS if Yes, not

Tom Wadewitz

you on considering is you Or I Are leverage, response. portion? understand just are Right, raising And the make just to an bid? about you commented you're cash about earlier concerned sure saying raising what the okay. your raising not it question

Keith Creel

We're focused the on getting represents the with KCS changing our not We've anything We're which value to this. considering agreed shareholder. deal, shareholder, bid. CP our for great

need what own more raising There's and based no agreement. to value an alone put that's the focused to need have to. on to it no money. discuss nothing discuss have merits. STB on its forward There's leverage. stands That's the compare paying We what on. we're in it we creates, It front of There's

board discussions? gets point to going KCS haven't. to. those decide differently. have a Not they Unless even the They why So and

And going There's need to. I'm on not they So no don't the I will. even there. believe facts, based

pretty think conclusions obvious. I I out. have are the scenarios obvious. to clear way don't a The draw decision is the

Tom Wadewitz

if you But the Okay. Board back, different consider it sounds came like. could approach, a

Keith Creel

I'm going comment just hypothetical. on not a to

I'm to going it can't. energy. not any Just give

going value the I to, And matters. deal truth. what this suggest it. not agreed creates. that's That's we've on unique focused do Just to would I'm that of the

Operator

I back over call We're Mr. of turn the time. to Keith now Creel. out

Keith Creel

has Okay, our thank I helped you truthful today. again, that of us discussion well hope joining fact-based some clear the for air.

to think the both the that responsibility deal opposition. associated look industry well the truth, are suggested. has risks speak it quarter company I forward as our being I to this responsibility. with to We some This feel that's value as strong our what of in alternatives strengths that that the certainly started spite creates, uniquely are results. and the second of in

challenging I outlook for The opportunity progress improvement finishing good. but margin double digit RTM we growth year, of see was of as end well year, the the our We at be year, shareholders to looks year, into be still going to second the single the digit, will February guided we've the a which month our for the rewarded result based record. on a will market what respect, again, track and is within think

forward So seeing well. everyone we soon. look Stay to

Operator

call. conference today's concludes This

may You now disconnect.