Transcript NA Grain

CP GRAIN IN
NORTH DAKOTA
January 2013
CANADIAN PACIFIC

Track miles:
14,700

Expense Employees:
14,200

Annual Carloads:
2.6 Million

2011 Revenues:
$5.2 Billion

Global reach through ports of Vancouver and the US PNW, Thunder Bay / Duluth, Montreal, & NEUS

North American reach through major hubs at Chicago, Minneapolis & Kansas City
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BOOK OF BUSINESS
Grain – CP’s Single Largest Commodity
Mix of business
Bulk
44%
(Percent of 2011 Freight Revenues)
Grain
22%
Coal
11%
Sulphur & Fertilizer
11%
Merchandise
30%
Industrial & Consumer
19%
Automotive
7%
Forest Products
4%
Intermodal
26%
Import/Export
13%
Domestic
13%
26%
44%
30%
Bulk
Merchandise
Intermodal
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GRAIN & CRUDE
The odd couple
For CP, Energy development in North Dakota has been going on since 2009. The expansion
of our energy portfolio has supported technology, capacity and operational improvements that
have benefitted our grain business, resulting in our ability to move a record number of grain
cars this crop year.
 Achieving record empty order fulfillment for US grain this crop year
 Reducing grain car cycles by nearly 20%
 Have secured target of $400 million of
energy growth
– Crude, frac sand, other inputs
 Will reach 70,000 car per year run rate in crude oil shipments in Q1 2013
3
NORTH AMERICAN PRODUCTION
AB Production:
18,077,000*
SK Production:
26,155,000*
MB Production:
7,538,000*
MN Production:
38,512,328**
ND Production:
9,354,656**
CP Rail Network
SD Production:
19,656,232**
* 6 majors + specialty crops, 5 Year Average (07/08 to 11/12) – metric tonnes
** Corn and Soybeans, 5 Year Average (07/08 to 11/12) – metric tonnes
Source: http://www5.statcan.gc.ca/cansim/a26
ENERGY - CP POSITIONING

Well established network for multiple traditional energy plays

Making / expanding markets in AIH, Marcellus and in Ethanol
4
Alberta’s Industrial Heartland
Bakken oil formation
Ethanol
Marcellus shale
CP Serves North America’s Most Compelling Energy Opportunities
5
Canadian Pacific Infrastructure Program
North Dakota and Minnesota
Edmonton
Sutherland
Calgary
Winnipeg
Moose Jaw
Vancouver
Thunder Bay
Lethbridge
Kingsgate
Coutts
1
2
1
3
4
2
3
4
5
8
Sudbury
7
6 Glenwood
St Paul
Toronto
Huron
Detroit
Mason City
Nahant
Montreal
Binghamton
Buffalo
Chicago
Sunbury
Kansas City
Projects completed in 2011
1. Portal Sub - Flaxton - siding extension (8500ft) & two yard track
extensions
2. Portal Sub - Harvey - West - extend inspection track
3. Newtown Sub - Max yard phase l – track extension
4. Newtown Sub - Newtown - runaround track
Projects completed in 2012
1.
2.
3.
4.
5.
6.
7.
8.
Carrington Sub – Harvey – yard expansion headroom east
Elbow Lake Sub – Enderlin – extend yard tracks
Newtown Sub – Drake – Newtown sub siding/yard reconfigure
Newtown Sub – Max yard phase ll – track extension
Newtown Sub – Various – AEIs/Radio Towers/HBDs
Detroit Lakes – Henning – siding extension
Detroit Lakes – Marsh Creek – new siding
Noyes – Lake Bronson - siding extension
6
SUSTAINABLE SERVICE IMPROVEMENTS
Recent changes to CP’s operating plan along with changes to our Products & Services and order
systems have greatly improved EOF and cycle times for Grain.
Overall US Grain Cycles
Average Weekly EOF
35
30
-24% YOY
25
-18% vs a 3-yr avg
20
15
Aug
Sep
2011
Aug
Sep
2011
Oct
3 Yr Avg
Nov
2012
Oct
3 Yr Avg
Nov
2012
PNW Cycles
25
+34% YOY
20
+20% vs a 3-yr avg
15
-27% YOY
-17% vs a 3-yr avg
10
Aug
CP is creating sustainable capacity to move
Sep
2011
Oct
3 Yr Avg
Nov
2012
more grain.
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CORPORATE OPERATING METRICS
Train length
Train weight
(Feet)
(Tons)
2010
2011
2012 YTD
2016
2010
2011
2012 YTD
Car velocity
Locomotive productivity
(Car miles/car day)
(GTMs/HP/day)
2010
2011
2012 YTD
2016
2010
2011
2012 YTD
2016
2016
Driving significant improvement
8
POSITIONED FOR SUCCESS
Grain and Crude
 Grain
 Responded to industry changes developing new markets and
leveraging our entire North American network
 Successfully implemented our grain improvement initiative
including the Grain Car Request System (GCRS)
 Positioned to drive further capacity, service delivery and asset
utilization improvements
 Crude
 Expanding in step-wise and collaborative way
 Achieving mutual commitment and investment
 Providing service and optionality value
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THANK YOU
QUESTIONS?