Mr. Hunter Harrison reports

CP REPORTS RECORD Q1 2015 OR OF 63.2 PERCENT AND EARNINGS PER SHARE OF C$1.92

Canadian Pacific Railway Ltd. has its lowest first quarter operating ratio (OR) in the company's history and the highest-ever net income for the period.

Revenues climbed 10 per cent to a first quarter record of $1.67-billion. Net income rose to an all-time quarterly high of $320-million, or $1.92 per diluted share, an improvement of 33 per cent. Adjusted earnings per share improved 59 per cent to $2.26.

"CP's success in the first quarter of the year is the result of hard work by its people and a business model that responds nimbly to any shift in economic conditions," said E. Hunter Harrison, CP's chief executive officer. "CP's relentless focus on rail safety and cost control has created a solid foundation for growth, innovation and creative collaboration with customers."

First quarter 2015 highlights

• Revenue climbed 10 per cent to $1.67-billion.
• OR fell to a first quarter record 63.2 per cent, an 880-basis-point improvement.
• Adjusted earnings per share advanced 59 per cent to $2.26.

"The diversity of the business and efficiency of CP's network and team has the company well positioned for the rest of the year," Mr. Harrison said. "Amid persistent uncertainty in the pace of the North American economic recovery, CP continues to demonstrate the ability to recognize and capitalize on new business opportunities and operational efficiencies.

"We are confident in our plan and our people, and are committed to achieving our goals for 2015."

                    INTERIM CONSOLIDATED STATEMENTS OF INCOME
                         (In millions, except per share)

                                                     Three months ended March 31,
                                                                 2015       2014
Revenues
Freight                                                      $  1,630   $  1,474
Non-freight                                                        35         35
Total revenues                                                  1,665      1,509
Operating expenses
Compensation and benefits                                         378        345
Fuel                                                              195        271
Materials                                                          52         52
Equipment rents                                                    42         41
Depreciation and amortization                                     146        141
Purchased services and other                                      240        236
Total operating expenses                                        1,053      1,086
Operating income                                                  612        423
Less
Other income and charges                                           73          -
Net interest expense                                               85         70
Income before income tax expense                                  454        353
Income tax expense                                                134         99
Net income                                                   $    320   $    254
Earnings per share
Basic earnings per share                                     $   1.94   $   1.45
Diluted earnings per share                                   $   1.92   $   1.44
Dividends declared per share                                 $ 0.3500   $ 0.3500

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