CN 1Q earnings beat Street expectations

CN late Tuesday reported its first-quarter net income increased 31% to C$668 million, or diluted earnings of C$1.45 per share, aided by the sale of a rail line. Excluding that sale, net income of C$414 million, or 90 Canadian cents a share, still beat Wall Street analysts expectations of 88 Canadian cents.

Revenue in the first-quarter rose 6% to about C$2.1 billion. CN’s operating ratio was 69.0%, a 0.3-point improvement over the operating ratio of 69.3% during the first quarter of 2010.

The company raised its financial guidance. It also plans to invest C$1 billion in infrastructure during 2011.

CN President and CEO Claude Mongeau said, "Despite a very challenging winter, CN produced a solid first-quarter performance thanks to further, gradual improvements in the North American and global economies and a well-executed winter operating plan. CN leveraged its continued investments in extended sidings by deploying additional distributed power-equipped locomotives. Our network initiatives, along with the benefits from supply chain collaboration, helped us maintain an efficient and fluid network.”