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

COVID-19. (Image courtesy CDC)
City and County of Wetaskiwin reporting active cases

Both the City of Wetaskiwin and County of Wetaskiwin have active cases.

Alberta chief medical officer of health Dr. Deena Hinshaw updates media on the Covid-19 situation in Edmonton on Friday March 20, 2020. nbsp;Alberta is reporting it's highest daily number of COVID-19 cases, with 364 new infections. THE CANADIAN PRESS/Jason Franson
Alberta confirmed 323 COVID-19 cases Tuesday

Central zone active cases at 145

COVID-19. (Image courtesy CDC)
Maskwacis reporting 37 active cases

Numbers current as of Oct. 19

Health Minister Tyler Shandro and Dr. Deena Hinshaw, the chief medical officer of health, receive flu shot. Photo via Government of Alberta
COVID-19: One more death in central zone

Ponoka County on province’s watchlist

Photo submitted/ Millet In Bloom
Town of Millet declared Best Blooming Community

The Town of Millet is being recognized for their efforts to meet the challenges of 2020.

Conservative member of Parliament Pierre Poilievre speaks during a press conference on Parliament Hill in Ottawa on October 19, 2020. THE CANADIAN PRESS/Sean Kilpatrick
Liberals say Tory effort to set up COVID-19 committee will be a confidence matter

The Tories were originally proposing an ‘anticorruption’ committee

File photo
RCMP’s response to online discussions about anti-racism demonstrations

Ponoka RCMP Staff Sgt.’s comments misattributed online

Shaelynn Decock and her dog Taco, who has been missing since Aug. 26. Photo Submitted
Sylvan Lake woman looking for closure for her stolen dog

Shaelynn Decock says it has been two months since she last saw her dog Taco

Prime Minister Justin Trudeau is seen during a news conference Tuesday October 20, 2020 in Ottawa. THE CANADIAN PRESS/Adrian Wyld
Trudeau and his family decide against trick-or-treating this year due to COVID

Adhering to local health authorities, Trudeau urges Canadians to do their part in following those guidelines

Natural Resources Minister Seamus O’Regan responds to a question during Question Period in the House of Commons Tuesday February 4, 2020 in Ottawa. The Alberta government is welcoming news that Ottawa has approved an expansion of the Nova Gas Transmission Ltd. gathering system in Alberta — while condemning federal delays that it says cost this summer’s construction season. THE CANADIAN PRESS/Adrian Wyld
Alberta welcomes federal approval of gas pipeline expansion while criticizing delay

The project is expected to create up to 2,920 direct jobs during construction, the federal release said

A Tim Hortons employee hands out coffee from a drive-through window to a customer in Mississauga, Ont., on March 17, 2020. Tim Hortons is ending the practice of double cupping hot drinks, a move the fast food restaurant says will eliminate hundreds of millions of cups from landfills each year. THE CANADIAN PRESS/Nathan Denette
The end of double cupping: Tim Hortons ditches two cups in favour of one with sleeve

Most recycling facilities in Canada don’t recycle single use paper coffee cups because of a plastic lining

Canada’s Chief Public Health Officer doctor Theresa Tam responds to a question during a news conference Tuesday October 20, 2020 in Ottawa. Canada’s chief public health doctor says in the age of social media, fake news about the COVID-19 pandemic has been spreading faster than the virus itself. THE CANADIAN PRESS/Adrian Wyld
VIDEO: Fake news creates serious issues for battling pandemic, chief public health doc says

Both Tam and Prime Minister Justin Trudeau urged Canadians to be responsible about the information they share

A narwhal tusk that was donated to a Goodwill store in northwest Calgary this summer will soon be gifted to the Arctic Institute of North America (Hesam Rezaei)
Narwhal tusk discovered in Calgary Goodwill pile to be donated to university

The tusk had federal hunting tags from 1978 attached that say animal was harvested from the central Arctic

(The Canadian Press)
Alberta-raised Cree actor lands role in Disney’s live-action ‘Peter Pan and Wendy’

Tiger Lily is featured in Disney’s 1953 animated “Peter Pan” film

Most Read