Canadian Pacific Announces Strong Operating Performance and Fourth-Quarter Results

CALGARY, Jan. 26, 2012 /CNW/ - Canadian Pacific Railway Limited (TSX: CP) (NYSE: CP) announced its fourth-quarter and full year 2011 results today.  Fourth-quarter CP reported net income of $221 million and diluted earnings per share of $1.30, inclusive of $0.22 per share income tax benefit.  For the full year, the company reported net income of $570 million and diluted earnings per share of $3.34.

"We exited 2011 having made meaningful progress on the three pillars of our Multi-Year Plan: driving growth, expanding network capacity to safely and efficiently support higher volumes and controlling costs.  During the fourth quarter we delivered record asset velocity, a direct link to better service, positioning us for a lower operating ratio," said Fred Green, President and Chief Executive Officer.  "We begin 2012 with operating momentum, excellent service levels and a stronger, more resilient rail network.  We are aggressively executing on our Multi-Year Plan, which is instrumental in creating long-term value for shareholders."

RECORD OPERATING PERFORMANCE

• Car miles per car day and terminal dwell both improved 20 per cent during the quarter
• Active cars online improved 14 per cent while handling five per cent more gross ton miles (GTMs) during the quarter
• Fuel efficiency of 1.17 gallons per 1,000 GTMs, matching best ever fourth-quarter performance
• Train weights set new full year record

FOURTH-QUARTER 2011 RESULTS COMPARED WITH FOURTH-QUARTER 2010

• Total revenues were $1.4 billion, an increase of $114 million
• Operating expenses were $1.1 billion, an increase of $109 million
• Average fuel price increased 29 per cent to $3.45 U.S. dollars per U.S. gallon
• Operating income was $303 million, an increase of $5 million
• Net income was $221 million, an increase of $35 million
• Diluted earnings per share were $1.30 per share, an increase of $0.21 per share

FULL YEAR 2011 RESULTS COMPARED WITH FULL YEAR 2010

• Total revenues were $5.2 billion, an increase of $196 million
• Operating expenses were $4.2 billion, an increase of $345 million
• Average fuel price increased 35 per cent to $3.38 U.S. dollars per U.S. gallon
• Operating income was $967 million, a decrease of $149 million
• Net income was $570 million, a decrease of $81 million
• Diluted earnings per share were $3.34 per share, a decrease of $0.51 per share
• Made a pension prepayment of $600 million in 2011 and $650 million in 2010
• Increased dividends to shareholders by 11 per cent to $1.1700 per share

MULTI-YEAR PLAN

"Our operational metrics are a leading indicator of both customer satisfaction and financial results.  The operational improvements we have already achieved will now begin to drive enhanced financial results in the first quarter of 2012 and, as we continue to execute on our Multi-Year Plan, further operational improvements will deliver financial benefits," added Fred Green. "Given our recent market successes and operating trends, we can now with confidence, narrow our target operating ratio range to 70 to 72 per cent in three years and we have no intention of stopping there."

2012 ASSUMPTIONS

Defined benefit pension contributions are currently estimated to be between $100 million and $125 million in each of the next few years, a decrease from previous estimates of $125 million to $150 million. These contribution levels reflect the Company's intentions with respect to application of voluntary prepayments.  Defined benefit pension expense for 2012 is expected to be $41 million.  For 2013, defined benefit pension expense is expected to be approximately $125 million, assuming normal equity market returns and modest increases in bond yields in 2012.

CP plans to spend in the range of $1.1 billion to $1.2 billion on capital programs in 2012, as announced on January 17, 2012.

CP expects its tax rate to be in the 25 per cent to 27 per cent range in 2012.

CONFERENCE CALL INFORMATION

CP will discuss its results with analysts in a conference call beginning at 11:00 a.m. Eastern time (9:00 a.m. Mountain time) on January 26, 2012.

Toronto/International participants dial in number: [phone]
Operator assisted toll free dial in number: 1-888-231-8191
Callers should dial in 10 minutes prior to the call.

WEBCAST

For those with Internet access we encourage you to listen via CP's website at www.cpr.ca. To access the webcast and the presentation material, click on "Invest In CP" tab.

A replay of the conference call will be available by phone through February 29, 2012 at [phone] or toll free 1-855-859-2056, passcode 36730106. A webcast of the presentation and an audio file will be available at www.cpr.ca under "Invest In CP" tab.

NOTE ON FORWARD-LOOKING INFORMATION

This news release contains certain forward-looking statements relating but not limited to our operations, anticipated financial performance and business prospects.  Undue reliance should not be placed on forward-looking information as actual results may differ materially.

By its nature, CP's forward-looking information involves numerous assumptions, inherent risks and uncertainties, including but not limited to the following factors: changes in business strategies; general North American and global economic, credit and business conditions; risks in agricultural production such as weather conditions and insect populations; the availability and price of energy commodities; the effects of competition and pricing pressures; industry capacity; shifts in market demand; inflation; changes in laws and regulations, including regulation of rates; changes in taxes and tax rates; potential increases in maintenance and operating costs; uncertainties of investigations, proceedings or other types of claims and litigation; labour disputes; risks and liabilities arising from derailments; transportation of dangerous goods; timing of completion of capital and maintenance projects; currency and interest rate fluctuations; effects of changes in market conditions and discount rates on the financial position of pension plans and investments, including long-term floating rate notes; and various events that could disrupt operations, including severe weather, droughts, floods, avalanches and earthquakes as well as security threats and governmental response to them, and technological changes.  Other risks are detailed from time to time in reports filed by CP with securities regulators in Canada and the United States.  Reference should be made to "Management's Discussion and Analysis" in CP's annual and interim reports, Annual Information Form and Form 40-F.

Except as required by law, CP undertakes no obligation to update publicly or otherwise revise any forward-looking information, whether as a result of new information, future events or otherwise.

ABOUT CANADIAN PACIFIC

Canadian Pacific (CP:TSX)(NYSE:CP) operates a North American transcontinental railway providing freight transportation services, logistics solutions and supply chain expertise. Incorporating best-in-class technology and environmental practices, CP is re-defining itself as a modern 21st century transportation company built on safety, service reliability and operational efficiency. Visit cpr.ca and see how Canadian Pacific is Driving the Digital Railway.

CONSOLIDATED STATEMENTS OF INCOME     
(in millions of Canadian dollars, except per share data)
(unaudited)

			For the three months						For the year
			ended December 31						ended December 31
			2011			2010			2011			2010
Revenues
	Freight	$	1,375		$	1,262		$	5,052		$	4,853
	Other		33			32			125			128
Total revenue			1,408			1,294			5,177			4,981
Operating expenses
	Compensation and benefits		389			362			1,426			1,431
	Fuel		267			202			968			728
	Materials		58			56			243			214
	Equipment rents		51			48			209			206
	Depreciation and amortization		123			121			490			489
	Purchased services and other		217			207			874			797
Total operating expenses			1,105			996			4,210			3,865
Operating income			303			298			967			1,116
Less:
	Other (income) and charges (Note 3)		10			(5)			18			(12)
	Net interest expense		61			65			252			257
Income before income tax expense			232			238			697			871
	Income tax expense (Note 2)		11			52			127			220
Net income		$	221		$	186		$	570		$	651
Earnings per share
	Basic	$	1.31		$	1.10		$	3.37		$	3.86
	Diluted	$	1.30		$	1.09		$	3.34		$	3.85
Weighted average number of shares (millions)
	Basic		169.8			169.1			169.5			168.8
	Diluted		170.8			169.7			170.6			169.2
Dividends declared per share		$	0.3000		$	0.2700		$	1.1700		$	1.0575
See notes to interim consolidated financial information.

CONSOLIDATED BALANCE SHEETS
(in millions of Canadian dollars)
(unaudited)

		December 31			December 31
		2011			2010
Assets
Current assets
	Cash and cash equivalents	$	47		$	361
	Accounts receivable, net		518			459
	Materials and supplies		138			114
	Deferred income taxes		101			222
	Other current assets		52			48
			856			1,204
Investments			167			145
Net properties			12,752			11,997
Goodwill and intangible assets			192			190
Other assets			143			140
Total assets		$	14,110		$	13,676
Liabilities and shareholders' equity
Current liabilities
	Short-term borrowing	$	27		$	-
	Accounts payable and accrued liabilities		1,133			1,008
	Long-term debt maturing within one year		50			282
			1,210			1,290
Pension and other benefit liabilities (Note 4)			1,372			1,116
Other long-term liabilities			365			468
Long-term debt (Note 3)			4,695			4,033
Deferred income taxes			1,819			1,945
Total liabilities			9,461			8,852
Shareholders' equity
	Share capital		1,854			1,813
	Additional paid-in capital		86			24
	Accumulated other comprehensive loss		(2,736)			(2,086)
	Retained earnings		5,445			5,073
			4,649			4,824
Total liabilities and shareholders' equity		$	14,110		$	13,676
See notes to interim consolidated financial information.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions of Canadian dollars)
(unaudited)

				For the three months						For the year
				ended December 31						ended December 31
					2011			2010			2011			2010
Operating activities
	Net income			$	221		$	186		$	570		$	651
		Reconciliation of net income to cash provided by (used in)
		operating activities:
			Depreciation and amortization		123			121			490			489
			Deferred income taxes (Note 2)		68			51			187			211
			Pension funding (in excess of) less than expense (Note 4)		(607)			5			(647)			(801)
			Other operating activities, net		(65)			(38)			(112)			(32)
			Change in non-cash working capital balances related to
			operations		99			56			24			(16)
Cash (used in) provided by operating activities					(161)			381			512			502
Investing activities
	Additions to properties				(400)			(282)			(1,104)			(726)
	Proceeds from the sale of properties and other assets				30			43			71			89
	Other				(4)			1			(11)			2
Cash used in investing activities					(374)			(238)			(1,044)			(635)
Financing activities
	Dividends paid				(51)			(46)			(193)			(174)
	Issuance of common shares				16			6			29			32
	Collection of receivable from financial institution				-			-			-			220
	Issuance of long-term debt (Note 3)				757			-			757			355
	Repayment of long-term debt (Note 3)				(257)			(8)			(401)			(613)
	Net increase in short-term borrowing				28			9			28			9
	Other				(3)			-			(3)			3
Cash provided by (used in) financing activities					490			(39)			217			(168)
Effect of foreign currency fluctuations on U.S. dollar-
denominated cash and cash equivalents					(5)			(11)			1			(17)
Cash position
	(Decrease) increase in cash and cash equivalents				(50)			93			(314)			(318)
	Cash and cash equivalents at beginning of period				97			268			361			679
Cash and cash equivalents at end of period				$	47		$	361		$	47		$	361
Supplemental disclosures of cash flow information:
	Income taxes paid			$	1		$	2		$	4		$	8
	Interest paid			$	91		$	95		$	271		$	347
See notes to interim consolidated financial information.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(in millions of Canadian dollars, except common share amounts)
(unaudited)

	Common					Accumulated
	shares			Additional		other				Total
	(in	Share		paid-in		comprehensive		Retained		shareholders'
	millions)	capital		capital		loss		earnings		equity
Balance at December 31, 2010	169.2	$	1,813	$	24	$	(2,086)	$	5,073	$	4,824
Net income	-		-		-		-		570		570
Other comprehensive loss	-		-		-		(650)		-		(650)
Dividends declared	-		-		-		-		(198)		(198)
Effect of stock-based compensation expense	-		-		16		-		-		16
Changes to stock compensation awards	-		-		57		-		-		57
Shares issued under stock option plans	0.8		41		(11)		-		-		30
Balance at December 31, 2011	170.0	$	1,854	$	86	$	(2,736)	$	5,445	$	4,649
						Other
						comprehensive		Net		Comprehensive
						loss		income		loss
Comprehensive loss - three months ended December 31, 2011						$	(743)	$	221	$	(522)
Comprehensive loss - year ended December 31, 2011						$	(650)	$	570	$	(80)
	Common					Accumulated
	shares			Additional		other				Total
	(in	Share		paid-in		comprehensive		Retained		shareholders'
	millions)	capital		capital		loss		earnings		equity
Balance at December 31, 2009	168.5	$	1,771	$	31	$	(1,745)	$	4,601	$	4,658
Net income	-		-		-		-		651		651
Other comprehensive loss	-		-		-		(341)		-		(341)
Dividends declared	-		-		-		-		(179)		(179)
Effect of stock-based compensation expense	-		-		1		-		-		1
Shares issued under stock option plans	0.7		42		(8)		-		-		34
Balance at December 31, 2010	169.2	$	1,813	$	24	$	(2,086)	$	5,073	$	4,824
						Other
						comprehensive		Net		Comprehensive
						loss		income		income (loss)
Comprehensive loss - three months ended December 31, 2010						$	(393)	$	186	$	(207)
Comprehensive income - year ended December 31, 2010						$	(341)	$	651	$	310
See notes to interim consolidated financial information.

NOTES TO INTERIM CONSOLIDATED FINANCIAL INFORMATION
December 31, 2011
(unaudited)

1  Basis of presentation

This unaudited interim consolidated financial information of Canadian Pacific Railway Limited ("CP", or "the Company") reflects management's estimates and assumptions that are necessary for its fair presentation in conformity with accounting principles generally accepted in the United States of America ("GAAP").  This information does not include all disclosures required under GAAP for annual and interim financial statements and should be read in conjunction with the 2010 consolidated financial statements and 2011 consolidated interim financial statements.  The policies used are consistent with the policies used in preparing the 2010 consolidated financial statements.  The Company's investments in which CP has significant influence, which are not consolidated, are accounted for using the equity method.

CP's operations can be affected by seasonal fluctuations such as changes in customer demand and weather-related issues.  This seasonality could impact quarter-over-quarter comparisons.

In management's opinion, the unaudited interim consolidated financial information includes all adjustments (consisting solely of normal recurring adjustments) necessary to present fairly such information.

2  Income taxes

Income tax expense for the fourth quarter of 2011 reflects a tax recovery of $37 million resulting from the resolution of certain income tax matters and adjustments related to previous year's tax filings and estimates.

3 Long-term debt

On September 13, 2011, the Company announced a cash tender offer and consent solicitation for any or all its outstanding US$246 million 6.25% Notes due October 15, 2011.  Notes tendered with a principal value of US$204 million were redeemed on October 12, 2011, and the remaining US$42 million Notes not tendered were redeemed on October 17, 2011.  Upon redemption of the Notes a net loss of $1 million was recognized to "Other income and charges" in the fourth quarter of 2011.

During December 2011, the Company issued $125 million 5.10% 10-year Notes, US$250 million 4.50% 10-year Notes and US$250 million 5.75% 30-year Notes.  Net proceeds from these offerings were $618 million and were largely used to make a $600 million voluntary prepayment to the Company's main Canadian defined benefit pension plan (see Note 4).

During the fourth quarter of 2011, the Company issued US$139 million 3.88% Series A and B Senior Secured Notes due in 2026 for net proceeds of $139 million.  These Notes are secured by locomotives previously acquired by the Company with a carrying value of $139 million at December 31, 2011.  The Company pays equal blended semi-annual payments of principal and interest up to and including December 2026. Final repayment of the remaining principal of US$69 million is due in the fourth quarter of 2026.

4  Pensions and other benefits

During the fourth quarter of 2011, the Company made a $600 million voluntary prepayment to the Company's main Canadian defined benefit pension plan.  The Company made a voluntary prepayment of $650 million to the Company's main Canadian defined benefit plan in September 2010.

As a result of lower discount rates at December 31, 2011, compared with December 31, 2010, as well as unfavourable 2011 equity returns, pension and post-retirement benefit liabilities increased by $1,040 million, other comprehensive loss was increased by $768 million and the Company's deferred tax liability was reduced by $272 million.  The Company used a discount rate of 4.55% at December 31, 2011, (2010 - 5.20%) to determine the pension and other post-retirement benefit obligation.

Summary of Rail Data
Fourth Quarter														Year
	2011			2010		Fav/(Unfav)		%			Financial (millions, except per share data)				2011			2010		Fav/(Unfav)		%
											Revenues
$	1,375		$	1,262		$	113	9				Freight revenue		$	5,052		$	4,853		$	199	4
	33			32			1	3				Other revenue			125			128			(3)	(2)
	1,408			1,294			114	9							5,177			4,981			196	4
											Operating expenses
	389			362			(27)	(7)				Compensation and benefits			1,426			1,431			5	-
	267			202			(65)	(32)				Fuel			968			728			(240)	(33)
	58			56			(2)	(4)				Materials			243			214			(29)	(14)
	51			48			(3)	(6)				Equipment rents			209			206			(3)	(1)
	123			121			(2)	(2)				Depreciation and amortization			490			489			(1)	-
	217			207			(10)	(5)				Purchased services and other			874			797			(77)	(10)
	1,105			996			(109)	(11)							4,210			3,865			(345)	(9)
	303			298			5	2			Operating income				967			1,116			(149)	(13)
											Less:
	10			(5)			(15)	-				Other (income) and charges			18			(12)			(30)	-
	61			65			4	6				Net interest expense			252			257			5	2
	232			238			(6)	(3)			Income before income tax expense				697			871			(174)	(20)
	11			52			41	79				Income tax expense			127			220			93	42
$	221		$	186		$	35	19			Net income			$	570		$	651		$	(81)	(12)
	78.5			77.0			(1.5)	(150)	bps		Operating ratio (%)				81.3			77.6			(3.7)	(370)	bps
$	1.31		$	1.10		$	0.21	19				Basic earnings per share		$	3.37		$	3.86		$	(0.49)	(13)
$	1.30		$	1.09		$	0.21	19				Diluted earnings per share		$	3.34		$	3.85		$	(0.51)	(13)
											Shares Outstanding
												Weighted average number of shares
	169.8			169.1			0.7	-				outstanding (millions)			169.5			168.8			0.7	-
												Weighted average number of diluted shares
	170.8			169.7			1.1	1				outstanding (millions)			170.6			169.2			1.4	1
											Foreign Exchange
												Average foreign exchange rate
	0.98			0.98			-	-				(US$/Canadian$)			1.01			0.97			(0.04)	(4)
												Average foreign exchange rate
	1.02			1.02			-	-				(Canadian$/US$)			0.99			1.03			(0.04)	(4)

Summary of Rail Data (Page 2)
Fourth Quarter															Year
	2011			2010		Fav/(Unfav)		%								2011			2010		Fav/(Unfav)		%
											Commodity Data
												Freight Revenues (millions)
$	323		$	299		$	24		8				- Grain		$	1,100		$	1,135		$	(35)		(3)
	158			126			32		25				- Coal			556			491			65		13
	133			132			1		1				- Sulphur and fertilizers			549			475			74		16
	47			50			(3)		(6)				- Forest products			189			185			4		2
	288			240			48		20				- Industrial and consumer products			1,017			903			114		13
	94			75			19		25				- Automotive			338			316			22		7
	332			340			(8)		(2)				- Intermodal			1,303			1,348			(45)		(3)
$	1,375		$	1,262		$	113		9			Total Freight Revenues			$	5,052		$	4,853		$	199		4
												Millions of Revenue Ton-Miles (RTM)
	9,111			8,775			336		4				- Grain			32,481			34,556			(2,075)		(6)
	5,860			4,814			1,046		22				- Coal			21,041			19,021			2,020		11
	4,899			4,963			(64)		(1)				- Sulphur and fertilizers			20,468			17,687			2,781		16
	1,176			1,344			(168)		(13)				- Forest products^(1)			4,960			5,091			(131)		(3)
	6,478			6,046			432		7				- Industrial and consumer products^(1)			24,122			22,143			1,979		9
	535			501			34		7				- Automotive			2,080			2,067			13		1
	6,025			6,440			(415)		(6)				- Intermodal			23,907			25,863			(1,956)		(8)
	34,084			32,883			1,201		4			Total RTMs				129,059			126,428			2,631		2
												Freight Revenue per RTM (cents)
	3.55			3.41			0.14		4				- Grain			3.39			3.28			0.11		3
	2.70			2.62			0.08		3				- Coal			2.64			2.58			0.06		2
	2.71			2.66			0.05		2				- Sulphur and fertilizers			2.68			2.69			(0.01)		-
	4.00			3.72			0.28		8				- Forest products^(1)			3.81			3.63			0.18		5
	4.45			3.97			0.48		12				- Industrial and consumer products^(1)			4.22			4.08			0.14		3
	17.57			14.97			2.60		17				- Automotive			16.25			15.29			0.96		6
	5.51			5.28			0.23		4				- Intermodal			5.45			5.21			0.24		5
	4.03			3.84			0.19		5			Total Freight Revenue per RTM				3.91			3.84			0.07		2
												Carloads (thousands)
	121			118			3		3				- Grain			450			467			(17)		(4)
	87			87			-		-				- Coal			313			341			(28)		(8)
	48			48			-		-				- Sulphur and fertilizers			199			177			22		12
	17			19			(2)		(11)				- Forest products			72			72			-		-
	114			102			12		12				- Industrial and consumer products			421			397			24		6
	39			34			5		15				- Automotive			145			137			8		6
	250			266			(16)		(6)				- Intermodal			997			1,070			(73)		(7)
	676			674			2		-			Total Carloads				2,597			2,661			(64)		(2)
												Freight Revenue per Carload
$	2,669		$	2,534		$	135		5				- Grain		$	2,444		$	2,430		$	14		1
	1,816			1,448			368		25				- Coal			1,776			1,440			336		23
	2,771			2,750			21		1				- Sulphur and fertilizers			2,759			2,684			75		3
	2,765			2,632			133		5				- Forest products			2,625			2,569			56		2
	2,526			2,353			173		7				- Industrial and consumer products			2,416			2,275			141		6
	2,410			2,206			204		9				- Automotive			2,331			2,307			24		1
	1,328			1,278			50		4				- Intermodal			1,307			1,260			47		4
$	2,034		$	1,872		$	162		9			Total Freight Revenue per Carload			$	1,945		$	1,824		$	121		7
(1)  Certain prior period figures have been updated to reflect new information.

Summary of Rail Data (Page 3)
Fourth Quarter										Year
2011		2010 ^(^1^)		Fav/(Unfav)		%				2011		2010 ^(^1)		Fav/(Unfav)		%
								Operations Performance
65,472		62,498		2,974		5		Freight gross ton-miles (millions)^(2)		247,955		242,757		5,198		2
10,611		10,132		479		5		Train miles (thousands)		40,145		39,576		569		1
16,616		15,637		(979)		(6)		Average number of active employees - Total		16,097		15,460		(637)		(4)
14,459		13,918		(541)		(4)		Average number of active employees - Expense		14,169		13,879		(290)		(2)
16,428		15,250		(1,178)		(8)		Number of employees at end of period - Total		16,428		15,250		(1,178)		(8)
14,764		14,048		(716)		(5)		Number of employees at end of period - Expense		14,764		14,048		(716)		(5)
46.7		54.1		7.4		14		Average daily active cars on-line (thousands)		51.4		50.9		(0.5)		(1)
1,085		1,048		(37)		(4)		Average daily active road locomotives on-line		1,085		1,016		(69)		(7)
76.0		74.3		(1.7)		(2)		U.S. gallons of locomotive fuel consumed (millions)^(3)		290.8		282.0		(8.8)		(3)
3.45		2.68		(0.77)		(29)		Average fuel price (U.S. dollars per U.S. gallon)		3.38		2.50		(0.88)		(35)
23.4		21.7		1.7		8		Average train speed - AAR definition (mph)		21.3		22.7		(1.4)		(6)
17.7		22.2		4.5		20		Average terminal dwell  - AAR definition (hours)		19.9		21.4		1.5		7
183.5		152.7		30.8		20		Car miles per car day		160.1		159.4		0.7		-
1.17		1.20		0.03		3		Fuel efficiency^(4)		1.18		1.17		(0.01)		(1)
6,587		6,559		28		-		Average train weight - excluding local traffic (tons)		6,593		6,519		74		1
5,654		5,652		2		-		Average train length - excluding local traffic (feet)		5,665		5,660		5		-
175.1		175.2		(0.1)		-		Locomotive productivity (daily average GTMs/active HP)		166.7		176.6		(9.9)		(6)
4.5		4.5		-		-		Employee productivity (million GTMs/expense employee)		17.5		17.5		-		-
1.75		1.80		0.05		3		FRA personal injuries per 200,000 employee-hours		1.86		1.67		(0.19)		(11)
1.38		1.27		(0.11)		(9)		FRA train accidents per million train-miles		1.85		1.65		(0.20)		(12)
1.69		1.59		(0.10)		(6)		Total operating expenses per GTM (cents)		1.70		1.59		(0.11)		(7)
								Operating expenses, less land sales and
1.63		1.63		-		-		the impact of fuel price, per GTM (cents)^(5)		1.61		1.60		(0.01)		(1)

(1)	Certain prior period figures have been revised to conform with current presentation or have been updated to reflect new information.
(2)	Gross Ton-Miles (GTM) is  the movement of the combined tons (freight car tare, inactive locomotive tare, and contents) a distance of one mile.
(3)	Includes gallons of fuel consumed from freight, yard and commuter service but excludes fuel used in capital projects and other non-freight activities.
(4)	Fuel efficiency is defined as U.S. gallons of locomotive fuel consumed per 1,000 GTMs - freight and yard.
(5)	Operating expenses, less land sales and the impact of fuel price, per GTM is calculated consistently with total operating expenses per GTM except for the exclusion of net gains on land sales and the fuel price impact, the latter to remove the volatility of fuel prices and to provide comparative fuel expenses at the 2010 fuel price.  Net gains on land sales were $20 million and $22 million for the three months ended December 31, 2011 and 2010, respectively, and $25 million and $28 million for the year ended December 31, 2011 and 2010, respectively. The impact in fuel price was $58 million for the three months ended December 31, 2011 and $247 million for the year ended December 31, 2011.