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Condensed Consolidating Financial Information (Tables)

6 Months Ended

Jun. 30, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Interim Condensed Consolidating Statements of Income

For the three months ended June 30, 2017



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Revenues
Freight	$	—		$	1,129		$	469		$	—		$	1,598
Non-freight	—			34			95			(84		)	45
Total revenues	—			1,163			564			(84		)	1,643
Operating expenses
Compensation and benefits	—			165			111			1			277
Fuel	—			122			38			—			160
Materials	—			34			8			6			48
Equipment rents	—			39			(2		)	—			37
Depreciation and amortization	—			108			57			—			165
Purchased services and other	—			210			158			(91		)	277
Total operating expenses	—			678			370			(84		)	964
Operating income	—			485			194			—			679
Less:
Other income and charges	(5		)	(59		)	3			—			(61		)
Net interest (income) expense	(9		)	139			(8		)	—			122
Income before income tax expense and equity in net earnings of subsidiaries	14			405			199			—			618
Less: Income tax expense	1			62			75			—			138
Add: Equity in net earnings of subsidiaries	467			124			—			(591		)	—
Net income	$	480		$	467		$	124		$	(591	)	$	480

Interim Condensed Consolidating Statements of Income

For the three months ended June 30, 2016



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Revenues
Freight	$	—		$	1,007		$	399		$	—		$	1,406
Non-freight	—			33			98			(87		)	44
Total revenues	—			1,040			497			(87		)	1,450
Operating expenses
Compensation and benefits	—			181			102			1			284
Fuel	—			103			28			—			131
Materials	—			27			8			3			38
Equipment rents	—			53			(9		)	—			44
Depreciation and amortization	—			107			54			—			161
Purchased services and other	—			193			139			(91		)	241
Total operating expenses	—			664			322			(87		)	899
Operating income	—			376			175			—			551
Less:
Other income and charges	(4		)	(12		)	7			—			(9		)
Net interest expense (income)	10			111			(6		)	—			115
(Loss) income before income tax expense and equity in net earnings of subsidiaries	(6		)	277			174			—			445
Less: Income tax (recovery) expense	(6		)	70			53			—			117
Add: Equity in net earnings of subsidiaries	328			121			—			(449		)	—
Net income	$	328		$	328		$	121		$	(449	)	$	328

Interim Condensed Consolidating Statements of Income

For the six months ended June 30, 2017



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Revenues
Freight	$	—		$	2,218		$	943		$	—		$	3,161
Non-freight	—			66			188			(169		)	85
Total revenues	—			2,284			1,131			(169		)	3,246
Operating expenses
Compensation and benefits	—			289			219			2			510
Fuel	—			254			76			—			330
Materials	—			68			17			12			97
Equipment rents	—			75			(2		)	—			73
Depreciation and amortization	—			217			114			—			331
Purchased services and other	—			418			320			(183		)	555
Total operating expenses	—			1,321			744			(169		)	1,896
Operating income	—			963			387			—			1,350
Less:
Other income and charges	(25		)	(66		)	2			—			(89		)
Net interest (income) expense	(7		)	264			(15		)	—			242
Income before income tax expense and equity in net earnings of subsidiaries	32			765			400			—			1,197
Less: Income tax expense	2			160			124			—			286
Add: Equity in net earnings of subsidiaries	881			276			—			(1,157		)	—
Net income	$	911		$	881		$	276		$	(1,157	)	$	911

Interim Condensed Consolidating Statements of Income

For the six months ended June 30, 2016



(in millions of Canadian dollars)	CPRL (Parent Guarantor)			CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Revenues
Freight	$	—		$	2,104		$	850		$	—		$	2,954
Non-freight	—			66			194			(173		)	87
Total revenues	—			2,170			1,044			(173		)	3,041
Operating expenses
Compensation and benefits	—			382			228			3			613
Fuel	—			206			50			—			256
Materials	—			65			18			11			94
Equipment rents	—			107			(18		)	—			89
Depreciation and amortization	—			214			109			—			323
Purchased services and other	—			329			320			(187		)	462
Total operating expenses	—			1,303			707			(173		)	1,837
Operating income	—			867			337			—			1,204
Less:
Other income and charges	(73		)	(150		)	33			—			(190		)
Net interest expense (income)	9			242			(12		)	—			239
Income before income tax expense and equity in net earnings of subsidiaries	64			775			316			—			1,155
Less: Income tax expense	3			181			103			—			287
Add: Equity in net earnings of subsidiaries	807			213			—			(1,020		)	—
Net income	$	868		$	807		$	213		$	(1,020	)	$	868

Interim Condensed Consolidating Statements of Comprehensive Income

For the three months ended June 30, 2017



(in millions of Canadian dollars)	CPRL (Parent Guarantor)		CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Net income	$	480	$	467		$	124		$	(591	)	$	480
Net gain (loss) in foreign currency translation adjustments, net of hedging activities	—		117			(103		)	—			14
Change in derivatives designated as cash flow hedges	—		4			—			—			4
Change in pension and post-retirement defined benefit plans	—		36			1			—			37
Other comprehensive income (loss) before income taxes	—		157			(102		)	—			55
Income tax expense on above items	—		(26		)	—			—			(26		)
Equity accounted investments	29		(102		)	—			73			—
Other comprehensive income (loss)	29		29			(102		)	73			29
Comprehensive income	$	509	$	496		$	22		$	(518	)	$	509

Interim Condensed Consolidating Statements of Comprehensive Income

For the three months ended June 30, 2016



(in millions of Canadian dollars)	CPRL (Parent Guarantor)		CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Net income	$	328	$	328		$	121		$	(449	)	$	328
Net gain (loss) in foreign currency translation adjustments, net of hedging activities	—		20			(17		)	—			3
Change in derivatives designated as cash flow hedges	—		(29		)	—			—			(29		)
Change in pension and post-retirement defined benefit plans	—		41			2			—			43
Other comprehensive income (loss) before income taxes	—		32			(15		)	—			17
Income tax expense on above items	—		(5		)	(2		)	—			(7		)
Equity accounted investments	10		(17		)	—			7			—
Other comprehensive income (loss)	10		10			(17		)	7			10
Comprehensive income	$	338	$	338		$	104		$	(442	)	$	338

Interim Condensed Consolidating Statements of Comprehensive Income

For the six months ended June 30, 2017



(in millions of Canadian dollars)	CPRL (Parent Guarantor)		CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Net income	$	911	$	881		$	276		$	(1,157	)	$	911
Net gain (loss) in foreign currency translation adjustments, net of hedging activities	—		162			(143		)	—			19
Change in derivatives designated as cash flow hedges	—		9			—			—			9
Change in pension and post-retirement defined benefit plans	—		72			3			—			75
Other comprehensive income (loss) before income taxes	—		243			(140		)	—			103
Income tax expense on above items	—		(43		)	(1		)	—			(44		)
Equity accounted investments	59		(141		)	—			82			—
Other comprehensive income (loss)	59		59			(141		)	82			59
Comprehensive income	$	970	$	940		$	135		$	(1,075	)	$	970

Interim Condensed Consolidating Statements of Comprehensive Income

For the six months ended June 30, 2016



(in millions of Canadian dollars)	CPRL (Parent Guarantor)		CPRC (Subsidiary Issuer)			Non-Guarantor Subsidiaries			Consolidating Adjustments and Eliminations			CPRL Consolidated
Net income	$	868	$	807		$	213		$	(1,020	)	$	868
Net gain (loss) in foreign currency translation adjustments, net of hedging activities	—		330			(290		)	—			40
Change in derivatives designated as cash flow hedges	—		(76		)	—			—			(76		)
Change in pension and post-retirement defined benefit plans	—		86			4			—			90
Other comprehensive income (loss) before income taxes	—		340			(286		)	—			54
Income tax expense on above items	—		(46		)	(2		)	—			(48		)
Equity accounted investments	6		(288		)	—			282			—
Other comprehensive income (loss)	6		6			(288		)	282			6
Comprehensive income (loss)	$	874	$	813		$	(75	)	$	(738	)	$	874

Interim Condensed Consolidating Balance Sheets

As at June 30, 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	$	—		$	178		$	60	$	—		$	238
Accounts receivable, net	—			440			164		—			604
Accounts receivable, inter-company	95			144			192		(431		)	—
Short-term advances to affiliates	499			559			4,817		(5,875		)	—
Materials and supplies	—			158			34		—			192
Other current assets	—			55			30		—			85
	594			1,534			5,297		(6,306		)	1,119
Long-term advances to affiliates	591			—			413		(1,004		)	—
Investments	—			43			143		—			186
Investments in subsidiaries	9,296			11,252			—		(20,548		)	—
Properties	—			8,850			7,853		—			16,703
Goodwill and intangible assets	—			—			195		—			195
Pension asset	—			1,261			—		—			1,261
Other assets	—			68			5		—			73
Deferred income taxes	11			—			—		(11		)	—
Total assets	$	10,492		$	23,008		$	13,906	$	(27,869	)	$	19,537
Liabilities and shareholders’ equity
Current liabilities
Accounts payable and accrued liabilities	$	84		$	797		$	302	$	—		$	1,183
Accounts payable, inter-company	16			283			132		(431		)	—
Short-term advances from affiliates	5,059			807			9		(5,875		)	—
Long-term debt maturing within one year	—			762			—		—			762
	5,159			2,649			443		(6,306		)	1,945
Pension and other benefit liabilities	—			657			72		—			729
Long-term advances from affiliates	—			1,004			—		(1,004		)	—
Other long-term liabilities	—			102			120		—			222
Long-term debt	—			7,606			54		—			7,660
Deferred income taxes	—			1,694			1,965		(11		)	3,648
Total liabilities	5,159			13,712			2,654		(7,321		)	14,204
Shareholders’ equity
Share capital	2,038			1,038			6,835		(7,873		)	2,038
Additional paid-in capital	42			1,639			300		(1,939		)	42
Accumulated other comprehensive (loss) income	(1,740		)	(1,740		)	571		1,169			(1,740		)
Retained earnings	4,993			8,359			3,546		(11,905		)	4,993
	5,333			9,296			11,252		(20,548		)	5,333
Total liabilities and shareholders’ equity	$	10,492		$	23,008		$	13,906	$	(27,869	)	$	19,537

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 June 30, 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	$	95		$	468		$	239		$	(191	)	$	611
Investing activities
Additions to properties	—			(192		)	(154		)	—			(346		)
Proceeds from sale of properties and other assets	—			5			8			—			13
Advances to affiliates	(1,086		)	(553		)	(973		)	2,612			—
Repayment of advances to affiliates	—			2			—			(2		)	—
Capital contributions to affiliates	—			(945		)	—			945			—
Other	—			1			(1		)	—			—
Cash used in investing activities	(1,086		)	(1,682		)	(1,120		)	3,555			(333		)
Financing activities
Dividends paid	(73		)	(73		)	(118		)	191			(73		)
Issuance of share capital	—			—			945			(945		)	—
Issuance of CP Common Shares	9			—			—			—			9
Purchase of CP Common Shares	(142		)	—			—			—			(142		)
Repayment of long-term debt, excluding commercial paper	—			(9		)	—			—			(9		)
Advances from affiliates	1,197			1,415			—			(2,612		)	—
Repayment of advances from affiliates	—			—			(2		)	2			—
Settlement of forward starting swaps	—			(22		)	—			—			(22		)
Cash provided by (used in) financing activities	991			1,311			825			(3,364		)	(237		)
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents	—			(2		)	(2		)	—			(4		)
Cash position
Increase (decrease) in cash and cash equivalents	—			95			(58		)	—			37
Cash and cash equivalents at beginning of period	—			83			118			—			201
Cash and cash equivalents at end of period	$	—		$	178		$	60		$	—		$	238

Interim Condensed Consolidating Statements of Cash Flows

For the three months ended June 30, 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	$	75		$	374		$	219		$	(156	)	$	512
Investing activities
Additions to properties	—			(206		)	(124		)	—			(330		)
Proceeds from sale of properties and other assets	—			11			—			—			11
Advances to affiliates	—			(482		)	(285		)	767			—
Repayment of advances to affiliates	—			208			—			(208		)	—
Capital contributions to affiliates	—			(348		)	—			348			—
Other	—			—			(2		)	—			(2		)
Cash used in investing activities	—			(817		)	(411		)	907			(321		)
Financing activities
Dividends paid	(53		)	(53		)	(103		)	156			(53		)
Issuance of share capital	—			—			348			(348		)	—
Issuance of CP Common Shares	4			—			—			—			4
Purchase of CP Common Shares	(788		)	—			—			—			(788		)
Repayment of long-term debt, excluding commercial paper	—			(7		)	—			—			(7		)
Net issuance of commercial paper	—			176			—			—			176
Advances from affiliates	762			—			5			(767		)	—
Repayment of advances from affiliates	—			—			(208		)	208			—
Other	—			(1		)	—			—			(1		)
Cash (used in) provided by financing activities	(75		)	115			42			(751		)	(669		)
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents	—			(1		)	—			—			(1		)
Cash position
Decrease in cash and cash equivalents	—			(329		)	(150		)	—			(479		)
Cash and cash equivalents at beginning of period	—			376			195			—			571
Cash and cash equivalents at end of period	$	—		$	47		$	45		$	—		$	92

Interim Condensed Consolidating Statements of Cash Flows

For the six months ended June 30, 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	$	158		$	553		$	503		$	(292	)	$	922
Investing activities
Additions to properties	—			(301		)	(275		)	—			(576		)
Proceeds from sale of properties and other assets	—			6			10			—			16
Advances to affiliates	(1,238		)	(551		)	(1,107		)	2,896			—
Capital contributions to affiliates	—			(1,013		)	—			1,013			—
Other	—			6			(1		)	—			5
Cash used in investing activities	(1,238		)	(1,853		)	(1,373		)	3,909			(555		)
Financing activities
Dividends paid	(146		)	(146		)	(146		)	292			(146		)
Issuance of share capital	—			—			1,013			(1,013		)	—
Issuance of CP Common Shares	37			—			—			—			37
Purchase of CP Common Shares	(142		)	—			—			—			(142		)
Repayment of long-term debt, excluding commercial paper	—			(14		)	—			—			(14		)
Advances from affiliates	1,331			1,564			1			(2,896		)	—
Settlement of forward starting swaps	—			(22		)	—			—			(22		)
Cash provided by (used in) financing activities	1,080			1,382			868			(3,617		)	(287		)
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents	—			(4		)	(2		)	—			(6		)
Cash position
Increase (decrease) in cash and cash equivalents	—			78			(4		)	—			74
Cash and cash equivalents at beginning of period	—			100			64			—			164
Cash and cash equivalents at end of period	$	—		$	178		$	60		$	—		$	238

Interim Condensed Consolidating Statements of Cash Flows

For the six months ended June 30, 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	$	98		$	425		$	417		$	(210	)	$	730
Investing activities
Additions to properties	—			(338		)	(270		)	—			(608		)
Proceeds from sale of properties and other assets	—			68			3			—			71
Advances to affiliates	—			(517		)	(285		)	802			—
Repayment of advances to affiliates	—			208			—			(208		)	—
Capital contributions to affiliates	—			(357		)	—			357			—
Repurchase of share capital from affiliates	—			6			—			(6		)	—
Other	—			—			(2		)	—			(2		)
Cash (used in) provided by investing activities	—			(930		)	(554		)	945			(539		)
Financing activities
Dividends paid	(107		)	(107		)	(103		)	210			(107		)
Return of share capital to affiliates	—			—			(6		)	6			—
Issuance of share capital	—			—			357			(357		)	—
Issuance of CP Common Shares	9			—			—			—			9
Purchase of CP Common Shares	(788		)	—			—			—			(788		)
Repayment of long-term debt, excluding commercial paper	—			(11		)	(7		)	—			(18		)
Net issuance of commercial paper	—			176			—			—			176
Advances from affiliates	788			—			14			(802		)	—
Repayment of advances from affiliates	—			—			(208		)	208			—
Other	—			(3		)	—			—			(3		)
Cash (used in) provided by financing activities	(98		)	55			47			(735		)	(731		)
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents	—			(5		)	(13		)	—			(18		)
Cash position
Decrease in cash and cash equivalents	—			(455		)	(103		)	—			(558		)
Cash and cash equivalents at beginning of period	—			502			148			—			650
Cash and cash equivalents at end of period	$	—		$	47		$	45		$	—		$	92