Canadian Pacific Kansas City (CP) investor relations material

Strategic growth and operational performance

• Achieved industry-leading growth through network synergies and self-help initiatives despite macroeconomic headwinds.

• On track for double-digit earnings growth, with strong cost control and efficient operations under the PSR model.

• Record Canadian grain crop and increased U.S. grain movement, with Chinese soybean demand boosting future volumes.

• Automotive and intermodal segments continue to set records, with new service offerings and partnerships driving expansion.

• Domestic intermodal up 48% YoY, with new express services and infrastructure investments supporting future growth.

Financial outlook and guidance

• Expecting mid-single digit RTM growth for the year, with margin improvement despite October softness.

• Guidance for 2026 to be provided in January, but current outlook anticipates similar growth and additional margin improvement.

• Multi-year EPS growth target in the mid-teens, with $1.4 billion in revenue synergies expected by end of 2026.

• Achieving double-digit EPS growth despite lower organic growth, offset by strong pricing and synergy realization.

Capital allocation and infrastructure

• Capital expenditures to step down in 2026, targeting $2.6–$2.8 billion annually, supporting cash flow and shareholder returns.

• Recent investments focused on network capacity, with future spending shifting toward operational efficiency and rolling stock.

• Dividend payout ratio targeted at 20–30%, with potential for increased buybacks as capital needs moderate.

• Infrastructure investments by partners, such as Americold, enhance network stickiness and growth opportunities.