CN Rail recalling some of its 4,000 laid off workers as pandemic woes ease

CN Rail recalling some of its 4,000 laid off workers as pandemic woes ease

CN Rail recalling some of its 4,000 laid off workers as pandemic woes ease

MONTREAL, Ont. — Canadian National Railway Co. has laid off about 4,000 employees from its workforce this year as profits sagged 60 per cent in the second quarter amid fallout from the COVID-19 pandemic.

Shipments declined nearly across the board, prompting layoffs that left the country’s largest railroad operator down 5,100 employees from June 2019, when it had some 26,500 workers.

Roughly 3,000 of the 4,000 workers who were let go in 2020 are on furlough — meaning they can be recalled if business picks up — while some 1,000 others were permanently laid off, said CEO JJ Ruest.

“We unfortunately had to do quite a few layoffs. The good news is we’re starting to recall some people back to work,” Ruest said on a conference call with analysts on Tuesday.

The pandemic “adversely impacted” earnings, with revenue from auto and petroleum/chemicals shipments dropping 72 per cent and 25 per cent year-over-year, respectively, CN said.

Container shipments — CN’s most lucrative category at $874 million, accounting for close to one-third of freight revenue — declined by 12 per cent as consumer spending plummeted amid lockdowns and store closures.

The railway’s “trough” in May saw furlough numbers peak in lockstep with low points such as a 90 per cent plunge in auto revenue that month, Ruest said.

Cautious optimism remains, however. After taking 14,500 cars off the tracks between April and June, CN has started to bring some out of storage for auto and lumber traffic. With more cars come more recalled workers.

“We’re very methodical about bringing them back,” said chief operating officer Rob Reilly. “We’re still trying to figure out what the future volume’s going to be.”

Grain and fertilizer shipments held firm in the second quarter, helping to mitigate damage from other categories at the company.

CN set records for grain volume in four consecutive months this year. The planned acquisition of 1,500 high-capacity hopper cars aims to continue that trend, CN said.

Nonetheless, net income dropped to $545 million in the quarter ended June 30, compared with $1.36 billion a year earlier.

Revenue decreased by $750 million or 19 per cent year-over-year to $3.21 billion in the second quarter, the Montreal-based company said.

On an adjusted basis, diluted earnings per share fell 26 per cent to $1.28 from $1.73, matching analyst predictions, according to financial markets data firm Refinitiv.

This report by The Canadian Press was first published July 21, 2020.

Companies in this story: (TSX:CNR)

Christopher Reynolds, The Canadian Press

railway

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Alberta has 1,910 active cases of COVID-19 as of Wednesday. Red Deer is reporting five active cases, with 108 recovered. (File photo)
Red Deer reports 25th COVID-19 death

415 new cases identified provincially Saturday

Alberta Health reported two new COVID-19 deaths in Red Deer Friday. (Image courtesy CDC)
Two more deaths linked to Olymel outbreak in Red Deer

Province reported 356 additional COVID-19 cases Friday

Alberta Premier Jason Kenney speaks during a news conference in Edmonton on Feb. 24, 2020. It’s budget day in the province, and Kenney’s United Conservative government is promising more help in the fight against COVID, but more red ink on the bottom line. THE CANADIAN PRESS/Jason Franson
Alberta’s budget promises more help for COVID-19 with a hard deficit

Annual spending on debt interest is closing in on $3 billion

The Town of Sylvan Lake has launched a new contest to attract a new business. (File photo by Advocate staff)
Sylvan Lake offering rent-free storefront space to lure new businesses

Winning business proposal will get a storefront space rent-free for a year

Alberta reported an additional 399 cases of COVID-19 Thursday, on 9,217 tests, for a test positivity rate of 4.3 per cent. (Image courtesy CDC)
Red Deer down to 562 active COVID-19 cases

8 new COVID-19 deaths, 399 additional COVID-19 cases

A helicopter flies past a mountain near McBride, B.C., on Saturday January 30, 2016. THE CANADIAN PRESS/Darryl Dyck
Avalanche warning for backcountry users in North and South Rockies

Avalanche Canada is urging backcountry users to always check their regional avalanche forecasts

Supporters pray outside court in Stony Plain, Alta., on Wednesday, Feb. 24, 2021, as a trial date was set for Pastor James Coates of GraceLife Church. He is charged with holding Sunday services in violation of Alberta’s COVID-19 rules and with breaking conditions of his bail release. THE CANADIAN PRESS/Jason Franson
Trial date for jailed Alberta pastor charged with breaking COVID-19 health orders

The court says it will reconvene with lawyers on March 5 for a case management plan by teleconference

A pharmacist prepares a COVID-19 vaccine at Village Green Retirement Campus in Federal Way on Jan. 26. (Olivia Sullivan/Sound Publishing)
Canada approves use of AstraZeneca’s COVID-19 vaccine

The country joins more than a dozen others in giving the shot the green light

Emily Keeping of Wetaskiwin, Alta., was last seen at 4:20 p.m. on Feb. 25, 2021 at the FasGas on 49 St and 50 Ave in Wetaskiwin. Supplied/ Wetaskiwin RCMP.
UPDATE: Wetaskiwin RCMP seek assistance in locating missing 11-year-old

Emily Keeping was last seen on Feb. 25, 2021 at the FasGas on 49 St and 50 Ave in Wetaskiwin.

Alberta premier Jason Kenney, right and Doug Schweitzer, Minister of Justice and Solicitor General, provide details about Bill 13, the Alberta Senate Election Act., in Edmonton Alta, on Wednesday June 26, 2019. THE CANADIAN PRESS/Jason Franson
Minister Doug Schweitzer talks on Enhanced COVID-19 Business Benefit

Provincial government rolling out new benefit this April to better help small businesses.

NDP leader Jagmeet Singh holds a press conference on Parliament Hill in Ottawa on Wednesday, Feb. 24, 2021. THE CANADIAN PRESS/Sean Kilpatrick
NDP will not trigger election as long as pandemic continues: Singh

‘“We will vote to keep the government going’

Minister Rick Wilson poses with Katie at the Boys and Girls Club of Wetaskiwin, both wearing her Pink Shirt Day design. Facebook/ Boys and Girls Club of Wetaskiwin.
Wetaskiwin Boys and Girls club Pink Shirt day design focuses on kindness

Katie with the Boys and Girls Club of Wetaskiwin created this year’s Pink Shirt Day design.

Most Read