Canadian National Railway Company (CNR) investor relations material

Long-term growth opportunities and network positioning

• Positioned on a rich natural resource base, especially in northern and western Canada, with strong port access on all coasts and a diverse business portfolio spanning consumer, industrial, and resource segments.

• Significant growth expected in natural resources, including energy products, potash, grain, and critical minerals, with industry forecasts of 25%-40% growth in natural gas and up to 70% in potash over the next decade.

• Export capabilities enhanced by exclusive access to Prince Rupert, which has shifted from primarily intermodal to a balanced export hub, with carload business rising from 40% to 55% in four years.

• Major capital investments over the past four years have increased network, locomotive, and railcar capacity, positioning for both immediate and long-term growth.

• Structural growth projects like the ACE Terminal partnership are expected to drive persistent, fundamental growth in energy exports.

Operational excellence and productivity

• Productivity improvements include 15% faster cycle times and record grain and corn crop movements without additional assets.

• Five consecutive quarters of domestic intermodal growth, with service quality enabling pricing above rail cost inflation.

• Operating leverage allows incremental volume growth to translate directly to earnings and free cash flow, with available capacity in every corridor.

• Modernized locomotive fleet and 25% increased western network capacity provide several years of growth before further capital investment is needed.

• Ongoing terminal productivity initiatives and technology adoption, including AI and data analytics, are expected to drive further efficiency gains.

Market dynamics, trade, and regulatory environment

• Trade diversification is a key theme, with efforts to expand beyond the U.S. while maintaining its critical importance; 75% of Canadian trade remains with the U.S.

• Tariff impacts have been largely mitigated, with most lost revenue replaced by new business, though forest products remain challenged.

• Regulatory changes are slow but progressing, with Canada granting some waivers ahead of the U.S.; industry seeks a more constructive framework to unlock technology-driven productivity.

• The Railway Safety Act is viewed as overly prescriptive and not addressing actual industry issues, potentially hindering operational efficiency.

• Autonomous trucking and rail technology are seen as necessary for future logistics efficiency, given labor constraints and economic growth aspirations.