Condensed Consolidating Financial Information (Tables)

3 Months Ended

Mar. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Interim Condensed Consolidating Statements of Income

For the three months ended March 31, 2020



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Revenues
Freight	$	—		$	1,457		$	543		$	—		$	2,000
Non-freight	—			33			93			(83		)	43
Total revenues	—			1,490			636			(83		)	2,043
Operating expenses
Compensation and benefits	—			275			120			3			398
Fuel	—			167			45			—			212
Materials	—			41			16			2			59
Equipment rents	—			44			(5		)	(3		)	36
Depreciation and amortization	—			115			77			—			192
Purchased services and other	—			243			154			(85		)	312
Total operating expenses	—			885			407			(83		)	1,209
Operating income	—			605			229			—			834
Less:
Other expense (income)	21			208			(18		)	—			211
Other components of net periodic benefit (recovery) expense	—			(87		)	2			—			(85		)
Net interest expense (income)	—			122			(8		)	—			114
(Loss) income before income tax expense and equity in net earnings of subsidiaries	(21		)	362			253			—			594
Less: Income tax expense	—			134			51			—			185
Add: Equity in net earnings of subsidiaries	430			202			—			(632		)	—
Net income	$	409		$	430		$	202		$	(632	)	$	409

Interim Condensed Consolidating Statements of Income

For the three months ended March 31, 2019



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Revenues
Freight	$	—		$	1,244		$	482		$	—		$	1,726
Non-freight	—			29			114			(102		)	41
Total revenues	—			1,273			596			(102		)	1,767
Operating expenses
Compensation and benefits	—			274			130			2			406
Fuel	—			165			44			—			209
Materials	—			38			15			4			57
Equipment rents	—			33			2			—			35
Depreciation and amortization	—			96			64			—			160
Purchased services and other	—			278			187			(108		)	357
Total operating expenses	—			884			442			(102		)	1,224
Operating income	—			389			154			—			543
Less:
Other (income) expense	(5		)	(43		)	1			—			(47		)
Other components of net periodic benefit (recovery) expense	—			(98		)	1			—			(97		)
Net interest (income) expense	(1		)	122			(7		)	—			114
Income before income tax expense and equity in net earnings of subsidiaries	6			408			159			—			573
Less: Income tax expense	—			104			35			—			139
Add: Equity in net earnings of subsidiaries	428			124			—			(552		)	—
Net income	$	434		$	428		$	124		$	(552	)	$	434

Interim Condensed Consolidating Statements of Comprehensive Income

For the three months ended March 31, 2020



(in millions of Canadian dollars)	CPRL (Parent Guarantor)		CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries		Consolidating Adjustments and Eliminations			CPRL Consolidated
Net income	$	409	$	430		$	202	$	(632	)	$	409
Net (loss) gain in foreign currency translation adjustments, net of hedging activities	—		(555		)	490		—			(65		)
Change in derivatives designated as cash flow hedges	—		2			—		—			2
Change in pension and post-retirement defined benefit plans	—		44			1		—			45
Other comprehensive (loss) income before income taxes	—		(509		)	491		—			(18		)
Income tax recovery on above items	—		60			—		—			60
Equity accounted investments	42		491			—		(533		)	—
Other comprehensive income	42		42			491		(533		)	42
Comprehensive income	$	451	$	472		$	693	$	(1,165	)	$	451

Interim Condensed Consolidating Statements of Comprehensive Income

For the three months ended March 31, 2019



(in millions of Canadian dollars)	CPRL (Parent Guarantor)		CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Net income	$	434	$	428		$	124		$	(552	)	$	434
Net gain (loss) in foreign currency translation adjustments, net of hedging activities	—		120			(104		)	—			16
Change in derivatives designated as cash flow hedges	—		2			—			—			2
Change in pension and post-retirement defined benefit plans	—		19			1			—			20
Other comprehensive income (loss) before income taxes	—		141			(103		)	—			38
Income tax expense on above items	—		(22		)	—			—			(22		)
Equity accounted investments	16		(103		)	—			87			—
Other comprehensive income (loss)	16		16			(103		)	87			16
Comprehensive income	$	450	$	444		$	21		$	(465	)	$	450

Interim Condensed Consolidating Balance Sheets

As at March 31, 2020



(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	$	—		$	119		$	128	$	—		$	247
Accounts receivable, net	—			670			215		—			885
Accounts receivable, intercompany	172			249			168		(589		)	—
Short-term advances to affiliates	—			1,891			3,874		(5,765		)	—
Materials and supplies	—			134			43		—			177
Other current assets	—			54			44		—			98
	172			3,117			4,472		(6,354		)	1,407
Long-term advances to affiliates	1,090			8			92		(1,190		)	—
Investments	—			29			340		—			369
Investments in subsidiaries	10,886			11,861			—		(22,747		)	—
Properties	—			10,446			9,454		—			19,900
Goodwill and intangible assets	—			—			223		—			223
Pension asset	—			1,111			—		—			1,111
Other assets	—			179			299		—			478
Deferred income taxes	5			—			—		(5		)	—
Total assets	$	12,153		$	26,751		$	14,880	$	(30,296	)	$	23,488
Liabilities and shareholders’ equity
Current liabilities
Accounts payable and accrued liabilities	$	113		$	1,025		$	390	$	—		$	1,528
Accounts payable, intercompany	7			333			249		(589		)	—
Short-term advances from affiliates	5,078			664			23		(5,765		)	—
Long-term debt maturing within one year	—			203			63		—			266
	5,198			2,225			725		(6,354		)	1,794
Pension and other benefit liabilities	—			695			95		—			790
Long-term advances from affiliates	—			1,181			9		(1,190		)	—
Other long-term liabilities	—			180			361		—			541
Long-term debt	—			9,804			—		—			9,804
Deferred income taxes	—			1,780			1,829		(5		)	3,604
Total liabilities	5,198			15,865			3,019		(7,549		)	16,533
Shareholders’ equity
Share capital	1,985			538			4,610		(5,148		)	1,985
Additional paid-in capital	51			411			267		(678		)	51
Accumulated other comprehensive (loss) income	(2,480		)	(2,480		)	1,072		1,408			(2,480		)
Retained earnings	7,399			12,417			5,912		(18,329		)	7,399
	6,955			10,886			11,861		(22,747		)	6,955
Total liabilities and shareholders’ equity	$	12,153		$	26,751		$	14,880	$	(30,296	)	$	23,488

Condensed Consolidating Balance Sheets

As at December 31, 2019



(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	$	—		$	37		$	96	$	—		$	133
Accounts receivable, net	24			597			184		—			805
Accounts receivable, intercompany	164			313			249		(726		)	—
Short-term advances to affiliates	—			1,387			3,700		(5,087		)	—
Materials and supplies	—			144			38		—			182
Other current assets	—			41			49		—			90
	188			2,519			4,316		(5,813		)	1,210
Long-term advances to affiliates	1,090			7			84		(1,181		)	—
Investments	—			32			309		—			341
Investments in subsidiaries	10,522			11,165			—		(21,687		)	—
Properties	—			10,287			8,869		—			19,156
Goodwill and intangible assets	—			—			206		—			206
Pension asset	—			1,003			—		—			1,003
Other assets	—			173			278		—			451
Deferred income taxes	4			—			—		(4		)	—
Total assets	$	11,804		$	25,186		$	14,062	$	(28,685	)	$	22,367
Liabilities and shareholders’ equity
Current liabilities
Accounts payable and accrued liabilities	$	146		$	1,189		$	358	$	—		$	1,693
Accounts payable, intercompany	6			402			318		(726		)	—
Short-term advances from affiliates	4,583			490			14		(5,087		)	—
Long-term debt maturing within one year	—			548			51		—			599
	4,735			2,629			741		(5,813		)	2,292
Pension and other benefit liabilities	—			698			87		—			785
Long-term advances from affiliates	—			1,174			7		(1,181		)	—
Other long-term liabilities	—			206			356		—			562
Long-term debt	—			8,145			13		—			8,158
Deferred income taxes	—			1,812			1,693		(4		)	3,501
Total liabilities	4,735			14,664			2,897		(6,998		)	15,298
Shareholders’ equity
Share capital	1,993			538			4,610		(5,148		)	1,993
Additional paid-in capital	48			406			265		(671		)	48
Accumulated other comprehensive (loss) income	(2,522		)	(2,522		)	581		1,941			(2,522		)
Retained earnings	7,550			12,100			5,709		(17,809		)	7,550
	7,069			10,522			11,165		(21,687		)	7,069
Total liabilities and shareholders’ equity	$	11,804		$	25,186		$	14,062	$	(28,685	)	$	22,367

Interim Condensed Consolidating Statements of Cash Flows

For the three months ended March 31, 2020



(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	$	94		$	240		$	269		$	(114	)	$	489
Investing activities
Additions to properties	—			(271		)	(84		)	—			(355		)
Proceeds from sale of properties and other assets	—			1			1			—			2
Advances to affiliates	—			(496		)	(175		)	671			—
Other	—			(8		)	(1		)	—			(9		)
Cash used in investing activities	—			(774		)	(259		)	671			(362		)
Financing activities
Dividends paid	(114		)	(114		)	—			114			(114		)
Issuance of CP Common Shares	24			—			—			—			24
Purchase of CP Common Shares	(501		)	—			—			—			(501		)
Issuance of long-term debt, excluding commercial paper	—			959			—			—			959
Repayment of long-term debt, excluding commercial paper	—			(6		)	(9		)	—			(15		)
Net repayment of commercial paper	—			(553		)	—			—			(553		)
Increase in short-term borrowings	—			145			—			—			145
Advances from affiliates	486			175			10			(671		)	—
Other	11			—			—			—			11
Cash (used in) provided by financing activities	(94		)	606			1			(557		)	(44		)
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents	—			10			21			—			31
Cash position
Increase in cash and cash equivalents	—			82			32			—			114
Cash and cash equivalents at beginning of period	—			37			96			—			133
Cash and cash equivalents at end of period	$	—		$	119		$	128		$	—		$	247

Interim Condensed Consolidating Statements of Cash Flows

For the three months ended March 31, 2019



(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	$	687		$	198		$	219		$	(691	)	$	413
Investing activities
Additions to properties	—			(141		)	(83		)	—			(224		)
Proceeds from sale of properties and other assets	—			4			2			—			6
Advances to affiliates	—			(250		)	(30		)	280			—
Repayment of advances to affiliates	—			643			—			(643		)	—
Other	—			—			(1		)	—			(1		)
Cash provided by (used in) investing activities	—			256			(112		)	(363		)	(219		)
Financing activities
Dividends paid	(91		)	(691		)	—			691			(91		)
Issuance of CP Common Shares	4			—			—			—			4
Purchase of CP Common Shares	(207		)	—			—			—			(207		)
Issuance of long-term debt, excluding commercial paper	—			397			—			—			397
Repayment of long-term debt, excluding commercial paper	—			(5		)	—			—			(5		)
Advances from affiliates	250			30			—			(280		)	—
Repayment of advances from affiliates	(643		)	—			—			643			—
Cash (used in) provided by financing activities	(687		)	(269		)	—			1,054			98
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents	—			(1		)	—			—			(1		)
Cash position
Increase in cash and cash equivalents	—			184			107			—			291
Cash and cash equivalents at beginning of period	—			42			19			—			61
Cash and cash equivalents at end of period	$	—		$	226		$	126		$	—		$	352