Fewer shipments and weak dollar cut into CN profits

Canadian National Railway's net earnings slipped 31 per cent in the fourth quarter as freight volumes dropped and the weaker Canadian dollar cut into operating expenses.

CN's earnings for the latest period amounted to $573 million, down from $833 million for the same time last year.

Revenues grew 13 per cent to $2.2 billion.

“The North American economy is in recession, and we do not know how long or deep it will be," E. Hunter Harrison, president and chief executive officer said in a statement.

“And, although overall freight demand is much weaker, the basic driver of our business — demand for reliable, efficient, cost-effective transportation — remains intact.”

At least one analyst isn't so sure.

"We feel these numbers are essentially irrelevant for CN," said Bill Harris, Partner and portfolio manager with Avenue Investment Management in Toronto. "You have to look out for the next three to six months and there will be significant deterioration."

Three was some good news for CN shareholders.

They can expect a 10 per cent increase in the quarterly dividend, up to 25.25 cents per common share.