Condensed Consolidating Financial Information (Tables)

3 Months Ended

Mar. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Interim Condensed Consolidating Statements of Income

For the three months ended March 31, 2017



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Revenues
Freight	$	—		$	1,089		$	474		$	—		$	1,563
Non-freight	—			32			93			(85		)	40
Total revenues	—			1,121			567			(85		)	1,603
Operating expenses
Compensation and benefits	—			124			108			1			233
Fuel	—			132			38			—			170
Materials	—			34			9			6			49
Equipment rents	—			36			—			—			36
Depreciation and amortization	—			109			57			—			166
Purchased services and other	—			208			162			(92		)	278
Total operating expenses	—			643			374			(85		)	932
Operating income	—			478			193			—			671
Less:
Other income and charges	(20		)	(7		)	(1		)	—			(28		)
Net interest expense (income)	2			125			(7		)	—			120
Income before income tax expense and equity in net earnings of subsidiaries	18			360			201			—			579
Less: Income tax expense	1			98			49			—			148
Add: Equity in net earnings of subsidiaries	414			152			—			(566		)	—
Net income	$	431		$	414		$	152		$	(566	)	$	431

Interim Condensed Consolidating Statements of Income

For the three months ended March 31, 2016



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Revenues
Freight	$	—		$	1,097		$	451		$	—		$	1,548
Non-freight	—			33			96			(86		)	43
Total revenues	—			1,130			547			(86		)	1,591
Operating expenses
Compensation and benefits	—			201			126			2			329
Fuel	—			103			22			—			125
Materials	—			38			10			8			56
Equipment rents	—			54			(9		)	—			45
Depreciation and amortization	—			107			55			—			162
Purchased services and other	—			136			181			(96		)	221
Total operating expenses	—			639			385			(86		)	938
Operating income	—			491			162			—			653
Less:
Other income and charges	(69		)	(138		)	26			—			(181		)
Net interest (income) expense	(1		)	131			(6		)	—			124
Income before income tax expense and equity in net earnings of subsidiaries	70			498			142			—			710
Less: Income tax expense	9			111			50			—			170
Add: Equity in net earnings of subsidiaries	479			92			—			(571		)	—
Net income	$	540		$	479		$	92		$	(571	)	$	540

Interim Condensed Consolidating Statements of Comprehensive Income

For the three months ended March 31, 2017



(in millions of Canadian dollars)	CPRL (Parent Guarantor)		CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Net income	$	431	$	414		$	152		$	(566	)	$	431
Net gain (loss) in foreign currency translation adjustments, net of hedging activities	—		45			(40		)	—			5
Change in derivatives designated as cash flow hedges	—		5			—			—			5
Change in pension and post-retirement defined benefit plans	—		36			2			—			38
Other comprehensive income (loss) before income taxes	—		86			(38		)	—			48
Income tax expense on above items	—		(17		)	(1		)	—			(18		)
Equity accounted investments	30		(39		)	—			9			—
Other comprehensive income (loss)	30		30			(39		)	9			30
Comprehensive income	$	461	$	444		$	113		$	(557	)	$	461

Interim Condensed Consolidating Statements of Comprehensive Income

For the three months ended March 31, 2016



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Net income	$	540		$	479		$	92		$	(571	)	$	540
Net gain (loss) in foreign currency translation adjustments, net of hedging activities	—			310			(273		)	—			37
Change in derivatives designated as cash flow hedges	—			(47		)	—			—			(47		)
Change in pension and post-retirement defined benefit plans	—			45			2			—			47
Other comprehensive income (loss) before income taxes	—			308			(271		)	—			37
Income tax expense on above items	—			(41		)	—			—			(41		)
Equity accounted investments	(4		)	(271		)	—			275			—
Other comprehensive loss	(4		)	(4		)	(271		)	275			(4		)
Comprehensive income (loss)	$	536		$	475		$	(179	)	$	(296	)	$	536

Interim Condensed Consolidating Balance Sheets

As at March 31, 2017



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries		Consolidating Adjustments and Eliminations			CPRL Consolidated
Assets
Current assets
Cash and cash equivalents	$	—		$	83		$	118	$	—		$	201
Accounts receivable, net	—			447			184		—			631
Accounts receivable, inter-company	92			152			194		(438		)	—
Short-term advances to affiliates	500			513			4,167		(5,180		)	—
Materials and supplies	—			167			34		—			201
Other current assets	—			52			25		—			77
	592			1,414			4,722		(5,618		)	1,110
Long-term advances to affiliates	1			—			90		(91		)	—
Investments	—			40			143		—			183
Investments in subsidiaries	8,882			10,404			—		(19,286		)	—
Properties	—			8,763			7,898		—			16,661
Goodwill and intangible assets	—			—			200		—			200
Pension asset	—			1,165			—		—			1,165
Other assets	—			69			9		—			78
Deferred income taxes	11			—			—		(11		)	—
Total assets	$	9,486		$	21,855		$	13,062	$	(25,006	)	$	19,397
Liabilities and shareholders’ equity
Current liabilities
Accounts payable and accrued liabilities	$	73		$	804		$	271	$	—		$	1,148
Accounts payable, inter-company	17			281			140		(438		)	—
Short-term advances from affiliates	4,358			813			9		(5,180		)	—
Long-term debt maturing within one year	—			31			—		—			31
	4,448			1,929			420		(5,618		)	1,179
Pension and other benefit liabilities	—			656			74		—			730
Long-term advances from affiliates	—			91			—		(91		)	—
Other long-term liabilities	—			96			131		—			227
Long-term debt	—			8,529			54		—			8,583
Deferred income taxes	—			1,672			1,979		(11		)	3,640
Total liabilities	4,448			12,973			2,658		(5,720		)	14,359
Shareholders’ equity
Share capital	2,036			1,037			5,891		(6,928		)	2,036
Additional paid-in capital	42			1,637			300		(1,937		)	42
Accumulated other comprehensive (loss) income	(1,769		)	(1,770		)	672		1,098			(1,769		)
Retained earnings	4,729			7,978			3,541		(11,519		)	4,729
	5,038			8,882			10,404		(19,286		)	5,038
Total liabilities and shareholders’ equity	$	9,486		$	21,855		$	13,062	$	(25,006	)	$	19,397

Condensed Consolidating Balance Sheets

As At December 31, 2016



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries		Consolidating Adjustments and Eliminations			CPRL Consolidated
Assets
Current assets
Cash and cash equivalents	$	—		$	100		$	64	$	—		$	164
Accounts receivable, net	—			435			156		—			591
Accounts receivable, inter-company	90			113			206		(409		)	—
Short-term advances to affiliates	500			692			4,035		(5,227		)	—
Materials and supplies	—			150			34		—			184
Other current assets	—			38			32		—			70
	590			1,528			4,527		(5,636		)	1,009
Long-term advances to affiliates	1			—			91		(92		)	—
Investments	—			47			147		—			194
Investments in subsidiaries	8,513			10,249			—		(18,762		)	—
Properties	—			8,756			7,933		—			16,689
Goodwill and intangible assets	—			—			202		—			202
Pension asset	—			1,070			—		—			1,070
Other assets	1			48			8		—			57
Deferred income taxes	11			—			—		(11		)	—
Total assets	$	9,116		$	21,698		$	12,908	$	(24,501	)	$	19,221
Liabilities and shareholders’ equity
Current liabilities
Accounts payable and accrued liabilities	$	73		$	945		$	304	$	—		$	1,322
Accounts payable, inter-company	14			292			103		(409		)	—
Short-term advances from affiliates	4,403			816			8		(5,227		)	—
Long-term debt maturing within one year	—			25			—		—			25
	4,490			2,078			415		(5,636		)	1,347
Pension and other benefit liabilities	—			658			76		—			734
Long-term advances from affiliates	—			92			—		(92		)	—
Other long-term liabilities	—			152			132		—			284
Long-term debt	—			8,605			54		—			8,659
Deferred income taxes	—			1,600			1,982		(11		)	3,571
Total liabilities	4,490			13,185			2,659		(5,739		)	14,595
Shareholders’ equity
Share capital	2,002			1,037			5,823		(6,860		)	2,002
Additional paid-in capital	52			1,638			298		(1,936		)	52
Accumulated other comprehensive (loss) income	(1,799		)	(1,799		)	712		1,087			(1,799		)
Retained earnings	4,371			7,637			3,416		(11,053		)	4,371
	4,626			8,513			10,249		(18,762		)	4,626
Total liabilities and shareholders’ equity	$	9,116		$	21,698		$	12,908	$	(24,501	)	$	19,221

Interim Condensed Consolidating Statements of Cash Flows

For the three months ended March 31, 2017



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Cash provided by operating activities	$	63		$	85		$	264		$	(101	)	$	311
Investing activities
Additions to properties	—			(109		)	(121		)	—			(230		)
Proceeds from sale of properties and other assets	—			1			2			—			3
Advances to affiliates	(152		)	—			(134		)	286			—
Capital contributions to affiliates	—			(68		)	—			68			—
Other	—			5			—			—			5
Cash used in investing activities	(152		)	(171		)	(253		)	354			(222		)
Financing activities
Dividends paid	(73		)	(73		)	(28		)	101			(73		)
Issuance of share capital	—			—			68			(68		)	—
Issuance of CP Common Shares	28			—			—			—			28
Repayment of long-term debt, excluding commercial paper	—			(5		)	—			—			(5		)
Advances from affiliates	134			149			3			(286		)	—
Cash provided by (used in) financing activities	89			71			43			(253		)	(50		)
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents	—			(2		)	—			—			(2		)
Cash position
(Decrease) increase in cash and cash equivalents	—			(17		)	54			—			37
Cash and cash equivalents at beginning of period	—			100			64			—			164
Cash and cash equivalents at end of period	$	—		$	83		$	118		$	—		$	201

Interim Condensed Consolidating Statements of Cash Flows

For the three months ended March 31, 2016



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Cash provided by operating activities	$	23		$	51		$	198		$	(54	)	$	218
Investing activities
Additions to properties	—			(132		)	(146		)	—			(278		)
Proceeds from sale of properties and other assets	—			57			3			—			60
Advances to affiliates	—			(35		)	—			35			—
Capital contributions to affiliates	—			(9		)	—			9			—
Repurchase of share capital from affiliates	—			6			—			(6		)	—
Cash used in investing activities	—			(113		)	(143		)	38			(218		)
Financing activities
Dividends paid	(54		)	(54		)	—			54			(54		)
Issuance of share capital	—			—			9			(9		)	—
Return of share capital to affiliates	—			—			(6		)	6			—
Issuance of CP Common Shares	5			—			—			—			5
Repayment of long-term debt, excluding commercial paper	—			(4		)	(7		)	—			(11		)
Advances from affiliates	26			—			9			(35		)	—
Other	—			(2		)	—			—			(2		)
Cash (used in) provided by financing activities	(23		)	(60		)	5			16			(62		)
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents	—			(4		)	(13		)	—			(17		)
Cash position
(Decrease) increase in cash and cash equivalents	—			(126		)	47			—			(79		)
Cash and cash equivalents at beginning of year	—			502			148			—			650
Cash and cash equivalents at end of year	$	—		$	376		$	195		$	—		$	571