CN Tuesday reported that net income and diluted earnings per share for the final quarter of 2009 increased 2.0% from the year-earlier period to C$582 million and C$1.23, respectively. Fourth-quarter 2009 revenue declined 14% from a year earlier to C$1,882 million. The fourth-quarter operating ratio was 65.3%, compared with 62.7% for the same quarter of 2008.
CN said results included an after-tax gain of C$59 million(C$0.12 per diluted share) from a line sale to Metrolinx, greater Toronto’s regional transit authority, and a deferred income tax recovery of C$99 million (C$0.21 per diluted share). Excluding these items, adjusted fourth-quarter net income was C$424 million,or C$0.90 per diluted share, compared with adjusted net income of C$531 million, or C$1.12 per diluted share, excluding a deferred income tax recovery, for the year-earlier period.
Free cash flow for full-year 2009 was C$790 million, compared with 2008's C$794 million. Net income for full-year 2009 decreased 2.0% from 2008.
Claude Mongeau, CN president and chief executive officer, said: "CN overcame a number of challenges during the fourth quarter, ranging from weather and operational disruptions in Western Canada to a five-day strike by locomotive engineers in Canada. In addition, the stronger Canadian dollar adversely affected our earnings. Despite these challenges, the final quarter of 2009 saw continued sequential improvement in CN's traffic levels and an easing in year-over-year volume comparisons. Carloadings were flat year-over-year, but up 4.0% versus the third quarter of 2009."
Fourth-quarter year-over-year growth was in coal, automotive, grain and fertilizers, and petroleum and chemicals volumes as the economic recovery began taking hold. Intermodal volumes declined 3%, metals and mineral carloadings were down 2%, and forest products markets remain depressed.
Mongeau said: "Throughout the year, the CN team raised the bar on operational execution, tightly controlled costs, and generated solid free cash flow and increased shareholder value through the monetization of underutilized assets. As we go forward, we will build on the improvements in operating metrics we achieved in 2009, including train velocity, lower freight car dwell times in terminals, and improved locomotive fuel efficiency."
Demolition of two existing short rail bridges is now under way at the Ft. Eustis Army Transportation Corp. base in Virginia to make way for two new bridges that will consist almost entirely of heavy-duty recycled plastic parts.
The prime contractor for the project is Parsons Brinckerhoff.
Axion International Holdings, Inc., is providing holdings, I-beams for pilecaps and main girders, and crossties/curbing. "All parts of the bridges will be made from Axion products except the steel fasteners and bolts,” said the company.
“We are pleased to announce the Ft. Eustis project is under way as we demolish the existing wood spans and make way for two new bridges utilizing our patented thermoplastic technology,” said Axion CEO Jim Kerstein. “Being the first known structures of this kind able to support 130 tons is a milestone achievement, considering the main components of these bridges are made entirely from 100% recycled consumer and industrial plastic. In fact, the only non-recycled plastic components of these bridges will be the steel connectors holding our Axion parts together and the rubber bearing pads that provide cushion between the main girders and pile caps.
“By utilizing recycled plastic, not only will these bridges not rot, rust, or corrode like traditional building materials, they will also help divert literally tons of recycled products that would normally be destined for landfills. This includes household items such as milk jugs, detergent bottles, and car bumpers.”
The new short-span bridges will extend approximately 40 feet and 80 feet, respectively. Each of these bridges are designed to achieve a high-load rating of 130 tons (in order to transport locomotives and freight traffic for military movement and base exercises and achieve a Cooper E60 Rating).
New York State Comptroller Thomas DiNapoli has issued a statement saying the cost of an electronic security plan for the Metropolitan Transportation Authority has increased from $591 million to $833 million, with only $59 million in funding still available.
"The transit system is safer than before September 11, 2001, due in large part to the efforts of the MTA Police Department, but some security improvements are years behind schedule and the electronic security program may never be completed," DiNapoli said.
The project, originally contracted to Lockheed Martin Corp., was due to be completed in August 2008. It was planned around a system of video cameras and electronic sensors, including motion detectors.
DiNapoli noted that Lockheed sued last April to terminate its contract and collect at least $138 million, citing obstacles including scheduling problems. MTA is countersuing for $92 million.
BNSF Railway said Tuesday it has reduced transit schedules on 60% of its Domestic Intermodal Premium Container traffic, and added 16 more days of service.
The changes include a reduction in travel time by 7-to-10 hours on BNSF’s premier Transcontinental route between Los Angeles/San Bernardino and Chicago, giving customers a morning availability and allowing forsame-day delivery. BNSF says it also reduced transit time between Memphis and Los Angeles by 4-to-6 hours, and increased Houston inbound and outbound day-of-week frequency.
“These changes are a direct result of feedback from our domestic carrier customers on what they need to attract more over-the-road freight to a truck-rail intermodal solution,” said George Duggan, BNSF vice president, Domestic Intermodal.
“We’re pleased to have worked with BNSF to create improved intermodal service offerings for the marketplace,” said Paul Bergant, J.B. Hunt chief marketing officer and president, Intermodal. “These changes come just in time for bid season and allow us to attract more retailers to the efficiencies that truck-rail intermodal has to offer.”
Said Dave Howland, Schneider Intermodal vice president, Rail Management, “These changes not only better fit the needs of our customers, but they also offer customers the single most effective way to reduce emissions in their transportation service, potentially reducing carbon emissions on average by more than 50%.”
“With more capacity, speed and now better service options, these service enhancements allow Swift to continue to provide its customers with flexibility and trucklike reliability at a cost-effective price,” said Mark Young, president, Swift Intermodal.
Tulsa, Okla.-based Miratech Corp., which designs and manufactures emission control products, says it has been notified that the Patent Cooperation Treaty (PCT) application submitted for its V-CAT® catalyst has been accepted. Suchacceptance smooths the process for subsequent international patent filings, the company says.
Under the PCT, Miratech,by filing a single international patent application in one language with one patent office, will streamline the process for seeking protection for its V-CATdesign in up to 117 countries throughout the world.
“This is a huge stepin our being able to take the V-CAT technology into the international marketplace with peace of mind that our intellectual property rights can be protected,” said Miratech CEO Bill Clary. “We’ve had outstanding success with V-CAT domestically, given its ability to provide operators of EMD diesel engines used to power locomotives, gensets, and marine vessels the means to meet—and exceed—EPA Tier 0, 1, and 2 standards for exhaust emissions. We’re excited about taking that success worldwide, and this moves us forward toward doing so.”
Russian Railways Tuesday signed an agreement with Moscow-based Russian Corporation of Nanotechnologies (Rusnano) for a strategic partnership in introducing and commercializing nanotechnology in railway transportation.
The agreement sets out a mechanism for introducing and promoting innovation, including nanotechnology products, in the railway sector. Work under the agreement will allow RZD to meet rising quality demands in transport services, and increase transport volumes, freight tonnage, and track speeds.
Under the agreement, RZD and Rusnano will determine the most promising areas in which nanotechnology products can be applied, and the regions and company subdivisions in which to implement comprehensive projects.
The companies plan to develop a system for statistical monitoring of the effectiveness of nanotechnology, in order to create an information base for management decision-making.
Oregon's Department of Transportation has rejected an application for funding by the Siskiyou Regional Railroad Authority (in California) to apply toward the Siskiyou Summit line, which straddles the California-Oregon border.
The authority, formed by the cities of Weed and Montague in northern California, sought $13.4 million in funding to upgrade 80 miles and support operations for the first six months of service resumption. Only 14 miles of the track in question lie north of the California border, extending to Ashland, Ore.
Oregon DOT's development division ruled that the application does not meet feasibility criteria. The authority has one month to appeal the decision, should it so choose.
The Siskiyou Regional Railroad Authority has signed a memoof understanding with Union Pacific to acquire the line. The authority plans tohire a short line operator to operate the railroad.John Hammond, authority president, said the arrangement would benefit shipperssuch as Roseburg Forest Products and Timber Products Co. It would also allowthe authority to later develop passenger service and provide excursion trainsover the “spectacular Siskiyou mountains,” Hammond said.
A survey conducted by Railway Age in late 2009 shows that the market for passenger railcars exceeded that for freight railcars last year and may do so again this year.
In 2009, 1,141 new passenger cars worth around $2 billion were delivered to passenger rail operators in the United States and Canada, and on Dec. 31, 2009, manufacturers had a backlog of 2,380 new passenger railcars on order and undelivered.
Approximately 22,650 new freight cars were delivered in 2009, valued at around $1.6 billion. The current estimate for 2010 is 15,750 freight cars.
“This does not mean that freight railroad capital spending is not continuing at a high level,” said Railway Age Publisher Robert P. DeMarco. “In fact, information made available to Railway Age shows that capital investment by our four largest railroads this year will be in the multi-billions, approaching the high levels of the last two years, though the emphasis will be changed.”
“While the freight car market will not heat up until the economy does,” said DeMarco, “the railroads will be spending heavily on new signaling initiatives, to improve safety and add capacity; they will invest in new and expanded intermodal facilities, to handle the fastest growing part of the railroad business as trucks increasingly turn over much of their business to the railroads for the long haul; and improvements to specific freight corridors will continue, in some cases to make room for the new business coming from trucks.
“Meanwhile, the renewed interest passenger rail of all kinds—intercity, metro, regional, light rail—is a welcome change in national transportation policy. It is also of importance to the companies that develop and market the technologies and products that are the key to the future of both passenger and freight rail,” DeMarco said.
As for freight rail capital spending in 2010, BNSF Railway, CSX, Norfolk Southern, and Union Pacific will be committing approximately the same amount as 2009. BNSF plans to spend $2.4 billion; CSX, $1.7 billion; NS, $1.4 billion; and UP, $2.5 billion. While no significant freight car or locomotive acquisitions are planned for this year, a far larger amount of signaling and communications dollars will be applied to Positive Train Control projects than in prior years, due to the federal PTC mandate.
The Federal Railroad Administration has named Dr. Magdy El-Sibaie its new deputy associate administrator for safety, regulatory, and legislative affairs. He succeeds Grady Cothen, who announced late last year that he would retire, but will assist with the transition through March.
El-Sibaie (pictured at left) most recently was acting associate administrator for hazardous materials safety at DOT’s Pipeline and Hazardous Materials Safety Administration. Until last October, he served as FRA’s director of research and development. Prior to that, he served as the agency’s chief of track research, where he managed the FRA’s track inspection technology development program that created improved systems for measuring track geometry at high speeds.
He joined FRA in 1995 as a senior program manager in the Office of Research and Development, chairing a government-industry working group that formulated the first set of safety standards for U.S. high speed rail service. He also worked with rail suppliers and Amtrak to establish standards for Amtrak Acela service operating on the Northeast Corridor.
El-Sibaie earned a doctorate in engineering mechanics from the University of Delaware in 1986, and was recruited by the Association of American Railroads as a researcher at the industry’s Chicago Technical Center, where he is credited with pioneering new methods of computer modeling to measure the dynamic behavior of track under varying loads, speeds, and conditions. For that work, the American Society of Mechanical Engineers honored him in in 1980 with its Rail Transportation Award.