CP Rail says drought will affect grain movement

Canadian Pacific Rail has lowered its volume outlook for the year due to the drought and supply chain challenges.

CP says it now expects low single digit volume growth this year compared with last year.

However, the railway says it remains confident it will deliver full-year double digit adjusted earnings per share growth.

CP says the smaller grain crop and some supply chain issues, but there are positive signs as well.

Grain revenue was down 21 percent in the third quarter compared to a year earlier, as the crop is expected to be 40 percent smaller than last year.

Automotive revenue was down 8 percent due to semiconductor chip shortages.

Meanwhile, demand for minerals was up with a 35 percent climb in revenue for metals, minerals and consumer products, a 27 percent jump for energy, chemicals and plastics, and a 22 percent increase for coal.

CP revenues for the third quarter reached 1.94 billion dollars, compared to 1.86 billion last year.

Profits were 472 million dollars, down from 598 million the same time in the previous year.

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