CN profit climbs on sale of railway corridor

CN three-month TSX trading

The sale of a railway corridor in Toronto was the main factor in the higher profit at Canadian National Railway Co. in the first quarter, the company said Monday.

Profit for the three months ended March 31 was $424 million (90 cents a diluted share), compared with $311 million (64 cents) a year earlier.

The 2009 figure includes a $135 million gain from the sale of a railway corridor to GO Transit in Toronto, a $28-million charge related to CN's purchase of the principal lines of the U.S. Elgin, Joliet and Eastern Railway Co., and a $15 million tax recovery.

After deducting those items, profit was $302 million (64 cents), slightly above adjusted first-quarter 2008 profit of $300 million (62 cents).

CN said revenue fell four per cent to $1.86 billion, compared with $1.93 billion.

Carloadings fell16 per cent to 954,000 from 1.13 million last year.

"Our traffic declined sharply as production cuts and reduced imports and exports coursed through the North American and global economies," president and CEO E. Hunter Harrison said.

But the weakening of the Canadian dollar vis a vis the U.S. dollar was a "shock absorber," he said.

CN stock fell $2.33 to $46.78 in TSX trading. The results were released after the market closed.