Canadian Pacific Kansas City Limited

Good morning. My name is Jason and I will be your conference operator today. At this time, I would like to welcome everyone to Canadian Pacific's second quarter 2020 conference call. The slides accompanying today's call are available at www.cpr.ca. 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 star, then the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. I would now like to introduce Megan Albiston, AVP Investor Relations and Pensions, to begin the conference.

Thank you, Jason. Good morning, everyone, and thank you for joining us today. Before we begin, I want to remind you that today's presentation contains forward-looking information and that actual results may differ materially. The risks, uncertainties, and other factors that could influence actual results are described on slide two in our press release and in the 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 CEO, Nadeem Vellani, Executive Vice President and Chief Financial Officer, and John Brooks, Executive Vice President and Chief Marketing Officer. The formal remarks will be followed by Q&A, and in the interest of time, we'd appreciate if you could limit your questions to one, and the Investor Relations Department would be happy to follow up with you afterwards for any follow-up questions. It's now my pleasure to introduce Mr. Keith Creel.

Thanks, Megan. Good morning. Beautiful day in Calgary. Let me start first and foremost. I'd be remiss not to begin my comments by applauding and continuing to thank our CP family. 12,000 strong, they continue to serve communities throughout Canada and the U.S. with a tremendous amount of pride. And it's that pride and it's our culture of accountability and performance that continue to fuel this unique performance that we produced at CP for our customers and for our shareholders. I can tell you as a leader, it's my honor to be able to serve with each of these men and women that make up our CP family every day. These employees are the true heroes that have been supplying and ensuring the supplies that people are depending upon are delivered. Rest assured, that's a responsibility that none of us take lightly. And I'm grateful to these employees and their union leaders for their continued strength and commitment to delivering for the North American economy, especially during this extraordinary time of need. So, under the guidance and the results, I can tell you we've consistently said that PSR is an operating model that works both on the upside and on the downside. And I'm sure that you would agree that today's results are a strong testament to that. In spite of the rapid change in volume, Mark and the operating team rose to the challenge throughout the quarter. They remained nimble. They adjusted resources and lockstep with our demand from the beginning to the end. This is what has enabled our strong operating performance across the board. Train weights and lengths, all-time record levels up 7% and 8% respectively. Locomotive productivity, again, an all-time best level, up 2% versus last year, full efficiency, a Q2 record, and a second-best quarter record for the company at 0.92 gallons per 1,000 GTMs, all of which enabled a record Q2 operating ratio of 57%. And as John will tell you as he provides color into the markets, This performance enabled us to set a number of new records for our grain and our potash customers that we're extremely proud of. You'll also note in our press release today that we provided updated guidance due to the strong performance. To date, we've guided a positive earnings growth for the year. We're following through on our commitment also that we made on our last earnings call, restarting our buyback and increasing our dividend. And as I said on our last call, we assured you that CP would emerge this pandemic a stronger company. Then we went in, and that's exactly what's happening. And it's not just the operating team that's moving the trains day in and day out. It's the folks that are working at home as well, the full team. This is a full team event. The men and women working from their homes have not been resting on their laurels, rest assured. We've been keeping constructive tension throughout the entire organization. We've challenged all of our people, especially those that are working at home, to find new and more innovative ways to work, focus on people. We focused on leadership. development and market development. I challenge John and the marketing team, sales team to get closer to the customer, to mine for opportunities, to drive additional volumes to the railroad, to be a problem solver, a transportation solution enabler for our customers in these tough times. We challenge the executive leadership team, get out of the office, get on the network, get on the ground. There's never been a better time to spend time with our people, the men and women, the heroes that are moving this traffic day in and day out. not only learn about the business, but let them know how much we appreciate what they're doing day in and day out when they come to work to protect the livelihood of others. Collectively also, we double down on leadership development. That's a legacy that I certainly intend to leave at this company. In order for this company to continue to improve, our leaders have to improve, and as the leaders improve, the company gets stronger, and that's the key to sustainability. That's the key to continuing and sustaining this very unique and special culture of accountability, this culture of performance that fuels these results and that delivers our freight to our customers day in and day out. It's the key to it, and we'll continue to develop those leaders through the training, the investment in each individual so they can realize their best potential and CP can realize its best potential. So the team's getting stronger. We're getting close to our customer. We're developing stronger leaders, and we're becoming better railroaders. It's fair to say we've been on the offense, not on the defense through these challenging and turbulent times. So with that said, now I'm going to turn it over to John to provide a bit more color on the markets.