Canadian Pacific Kansas City

Please stand by. Your program is about to begin. If you need assistance on today's call, please press star zero. Good afternoon. My name is Leo, and I'll be your conference operator today. At this time, I would like to welcome everyone to Canadian Pacific's first quarter 2022 conference call. The slides accompanying today's call are available at All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question, simply press the star, then the number one on your telephone keypad. If you would like to withdraw your question, please press the pound key. I would now like to introduce Megan Albiston, Vice President, Capital Markets, to begin the conference.

Thank you, Leo. Good afternoon, everyone, and thank you for joining us today. Before we begin, I want to remind you that this presentation contains forward-looking information, and actual results may differ materially. The risks, uncertainties, and other factors that could influence actual results are described on slide two in the press release and in our MD&A filed with Canadian and U.S. regulators. This presentation also contains non-GAAP measures, which are outlined on slide three. With me here today is Keith Creel, our President and Chief Executive Officer, Nadeem Volani, Executive Vice President and Chief Financial Officer, and John Brooks, Executive Vice President and Chief Marketing Officer. Also attending our call today on behalf of KCS are CEO Pat Ottensmeyer and CFO Mike Upchurch, who will be happy to answer any questions regarding KCS. As CP investors are aware, KCS is now beneficially owned by CP through a voting trust, pending control approval by the STB. During this trust period and prior to the STB approving CP's control of KCS, CP and KCS operate independently, and KCS's business is managed by its own officers and is overseen by its own board of directors. During this trust period and... Truly, KCS's management is in the best position to answer investor questions regarding their performance and results. I would highlight that KCS has also posted an information package to their website. And should you have any questions about their performance that aren't addressed on today's call, Ashley and Daniel on KCS's IR team would be pleased to answer your questions. The formal remarks today will be followed by Q&A, and in the interest of time, we'd appreciate if you could limit your questions to one. It's now my pleasure to introduce President and CEO, Mr. Keith Creel.

Thanks, Megan. Good afternoon and welcome, everyone, joining us on our first quarter earnings call. Let's not be remiss not to start thanking the 12,000-strong CP family that endured quite a challenging quarter. It's been one for the ages. In fact, all of the The uncontrollable challenges that we had relative to the weather, which was a huge challenge, and obviously this COVID Omicron spike, this company spiked up. We moved up to about 500 employees that had to face the Omicron challenge during the quarter, which obviously had an adverse impact to our network velocity, and then finally had a very unfortunate work stoppage. But in spite of all those challenges, the tenacity of And the grit of this team, the commitment that we have to each other to provide service for our customers and serve all of our stakeholders was untapped out, never short of an opportunity to step into that and to meet and exceed those challenges. So let me talk about the results a bit. The quarter delivered first quarter revenues of $1.8 billion, an operating ratio of 69.8, and core EPS of 67 cents. On the train accident front, we were encouraged that we reduced our reportable train accident frequency by another 25% on the quarter. On the safety front, when it comes to personal injuries, we did have a bit of slippage there at 13% versus last year, which is always a reminder to myself, the team, and the company that safety, it's not a destination, it's a journey. We can never lose sight of the importance of making sure that every member of our family go home safely every day. So it was a tough quarter. I'm not here to make any excuses. This team's not going to today. We knew that it would be challenging the first half, certainly more out in Q1. Despite those challenges, our outlook on the year remains largely unchanged. We continue to see a very strong and supportive macro environment. We still expect to deliver double-digit RTM growth in the back half and ultimately grow RTMs on the year. So the point that we made earlier that this was going to be a year of tele-two-halves is playing out as expected. On the CPKC transaction, the merger front, the preparation, the planning to ensure we execute our integration between these two great companies from day one continues. We're excited to announce during the quarter that we successfully launched our first interline service from Lazaro Cardenas to Chicago in early March with a seven-day transit time from the time the ship left. hit the port docks to the time the first container was deramped on the Chicago and hit the pavement, seven days. A pretty compelling product to test the market. It was a demonstration of a significant opportunity, obviously, to bring an alternative to the congested West Coast ports for our customers and for our marketplace. This is a product that works when it's congested. This is a product that works when it's uncongested. It's an undeniable compelling product that these two companies will be able to bring to the marketplace. CPKC's represents extremely meaningful opportunity to take trucks off of our highways to leverage our fuel efficiency that we enjoy on the rail side versus truck and to contribute obviously to a low carbon future for North America, Canada and Mexico. Also, I want to tell you even more excited about the potential that this unlocks for the North American supply chain, which is becoming increasingly more important. The additional outlets for North American resources that, in fact, are increasing in demand. We've got three very resource-rich nations creating a network to connect to ports, 11 of those ports that will uniquely serve and ultimately get our products to Tidewater to like-minded countries around the world. To say we're excited, I would suggest, is an understatement as we look forward to the opportunities ahead of us. Our customers are looking forward to us as well for the prospect of this great single-line service from Mexico through to Canada, and I'll tell you we're excited and looking forward to the path forward. And on that point, I know that many of you are following the SDB process closely. Obviously, we all know the procedural schedule has been paused right now as we've been asked to clarify some of the data, which we have done. We're certainly optimistic things will be restarted soon. I say that, and I remind folks as well, there's room in the overall schedule for the board to take the time it needs to consider all the facts and the data. We do not see this materially delaying the combination. We still anticipate a ruling by the latest early 2023. So with that, let me hand it over to John to bring some color to the markets, and then Nadine will close up before we open for questions elaborating on the numbers.