Canadian Pacific Kansas City (CP) Investor presentation summary

Strategic transformation and network expansion

• Combined network now spans 20,000 route miles across Canada, the U.S., and Mexico, offering unique three-country connectivity and access to over 30 ports and 200+ transload facilities.

• The merger has created the only North American rail network connecting all three countries, enabling new market opportunities and competitive advantages.

• Strategic land holdings and surplus acreage in key markets like Kansas City, Dallas, Chicago, Vancouver, and Toronto provide significant room for low-cost capacity expansion.

• Investments in infrastructure, such as the Laredo International Railway Bridge expansion, support future growth and cross-border trade.

• The network is positioned to benefit from nearshoring trends and increased U.S.-Mexico trade, leveraging robust manufacturing and supply chain advantages.

Financial performance and outlook

• 2024 total revenues reached $14.5B CAD, up 16% year-over-year, with core adjusted combined operating income up 6% and core adjusted combined diluted EPS up 11%.

• Operating ratio improved to 64.4% as reported and 61.3% on a core adjusted basis.

• 2025 outlook projects 12–18% core adjusted diluted EPS growth, mid-single digit RTM growth, and $2.9B in capital expenditures.

• Long-term guidance (2024–2028) targets high single-digit revenue growth, double-digit core adjusted EPS growth, and annual capital expenditures of $2.6–$2.8B.

• Continued deleveraging with a target net debt to adjusted EBITDA ratio of 2.5x, down from 3.1x in 2024.

Operational excellence and innovation

• Precision railroading model drives industry-leading performance, with improvements in train speed (+7%), terminal dwell (-5%), and locomotive productivity (+6%) versus 2023.

• Predictive analytics and advanced technology, including remote train inspection portals and track health monitoring, enhance safety, efficiency, and capacity.

• Investment in digital and operational technology positions the network at the forefront of predictive analytics in the rail industry.

• Safety remains foundational, with the lowest FRA-reportable train accident frequency among Class 1 railroads for two consecutive years.

• Management compensation is tied to safety performance, reinforcing a culture of accountability.