Exhibit 99.1

Selected Unaudited Combined Summary of Historical Financial Data

CANADIAN PACIFIC KANSAS CITY LIMITED

TABLE OF CONTENTS

	Page
Background	2
Part I - Combined Financial Highlights	3
Part II - Regulation S-X Article 11 - Pro Forma Financial Information (unaudited)	4
1. Summary of Pro Forma Financial Information	4
2. Pro Forma Consolidated Income Statement for the First Quarter Ended March 31, 2023	5
3. Pro Forma Consolidated Income Statement for the First Quarter Ended March 31, 2022	6
4. Pro Forma Consolidated Income Statement for the Second Quarter Ended June 30, 2022	7
5. Pro Forma Consolidated Income Statement for the Third Quarter Ended September 30, 2022	8
6. Pro Forma Consolidated Income Statement for the Fourth Quarter Ended December 31, 2022	9
7. Pro Forma Consolidated Income Statement for the Year Ended December 31, 2022	10
8. Pro Forma Explanatory Notes	11
Part III - Non-GAAP Measures	21

1

Background

On September 15, 2021, Canadian Pacific Railway Limited, a Canadian corporation (“CPRL”), entered into an Agreement and Plan of Merger (the "Merger Agreement") with Kansas City Southern, a Delaware corporation (“KCS”).

On December 14, 2021, following approval of the transaction by the shareholders of both CPRL and KCS, receipt of Mexican regulatory approvals, satisfaction of customary closing conditions and pursuant to the terms set forth in the Merger Agreement, CPRL completed the indirect acquisition of KCS. Pending regulatory approval from the U.S. Surface Transportation Board (the “STB”), the shares of KCS common stock were deposited by a subsidiary of CPRL into a voting trust to ensure that KCS operated independently of CPRL during the regulatory review process. During this period, CPRL recorded its investment in KCS using the equity method of accounting up to the date effective control of KCS was obtained.

On March 15, 2023, the STB issued a decision approving the CPRL and KCS joint merger application, subject to certain conditions. On April 14, 2023 (“Control Date”), CPRL assumed control of KCS and filed articles of amendment to change CPRL's name to Canadian Pacific Kansas City Limited ("CPKC").

Accordingly, effective as of the Control Date, CPKC consolidates KCS, accounting for the acquisition as a business combination achieved in stages. In accounting for the business combination, CPRL’s previously held interest in KCS has been remeasured to its Control Date fair value. The identifiable assets acquired, and liabilities and non-controlling interest assumed, have been measured at their fair value at the Control Date, with certain exceptions.

In this Selected Unaudited Combined Summary of Historical Financial Data, unless the context indicates otherwise, references to “CPRL” refer to Canadian Pacific Railway Limited prior to the Control Date without giving effect to the KCS business combination.

The Selected Unaudited Combined Summary of Historical Financial Data is intended to provide investors with combined company information, including the following three sections and related schedules:

–Part I - Combined Financial Highlights: Combined Financial Highlights to illustrate the estimated effects of combining CPRL and KCS key financial measures for the first quarter ended March 31, 2023 and each of the four quarters and the full year of 2022 as if CPRL and KCS formed a combined company for these periods. Certain of these combined financial measures are derived from Part II Regulation S-X Article 11 Pro Forma Financial Information included on page 4-20 prepared in accordance with Regulation S-X Article 11 ("Article 11"). Other combined financial measures presented have been derived from the Pro Forma Financial Information but have been adjusted in a manner not consistent with Article 11 and are presented as non-GAAP measures.

–Part II - Regulation S-X Article 11 - Pro forma Financial Information

•Summary of Pro forma Financial Information: Summary of Pro forma Financial Information to illustrate the estimated effects of the acquisition for the first quarter ended March 31, 2023 and each of the four quarters and the full year of 2022, as if the acquisition closed on January 1, 2022;

•Pro Forma Consolidated Statement of Income: Pro Forma Consolidated Statement of Income to provide details about pro forma adjustments applied in accordance with Article 11 to illustrate the estimated effects of the acquisition for all periods presented in the Summary of Pro Forma Financial Information; and

•Pro Forma Explanatory Notes: Pro Forma Explanatory Notes to explain the basis of presentations, presentation currency translation and each pro forma adjustment applied.

–Part III - Non-GAAP Measures: Non-GAAP Measures includes reconciliations of non-GAAP measures presented in the Part I Combined Financial Highlights to the most comparable pro forma GAAP performance measure.

The Selected Unaudited Combined Summary of Historical Financial Data is provided on a voluntary basis for illustrative purposes only and does not purport to represent what the actual consolidated results of operations would have been had CPRL had control of KCS and consolidation actually had occurred for the periods presented. The Selected Unaudited Combined Summary of Historical Financial Data also does not purport to project the future consolidated results of operations for any future period or as of any future date. The Regulation S-X Article Pro Forma Financial Information sets forth important financial measures defined by U.S. generally accepted accounting principles (“GAAP”) and utilized by CPKC management. CPKC also uses Non-GAAP performance measures, among other measures, to evaluate operating performance. These Non-GAAP performance measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP and are defined and reconciled in the attached supplementary schedule Non-GAAP Measures.

This document does not represent a restatement of CPRL’s or KCS's previously issued consolidated financial statements. CPRL did not control KCS during any of the periods presented. This document has been prepared by and is the responsibility of CPKC’s management. CPKC’s independent auditors have not performed a review of this document.

2

Part I - Combined Financial Highlights (unaudited)

These combined financial measures are derived from Part II Regulation S-X Article 11 Pro Forma Financial Information section.

	Combined Financial Highlights (unaudited)
(in millions of Canadian dollars, except for percentages, share and per share data)	For the quarter ended															For the year ended
	03/31/23			03/31/22			06/30/22			09/30/22			12/31/22			12/31/22
Combined operating ratio(1)	66.5		%	71.9		%	63.7		%	63.0		%	63.9		%	65.3		%
Core adjusted combined operating ratio(2)	63.5		%	66.7		%	60.3		%	59.8		%	60.9		%	61.7		%
Pro forma operating income	$	1,157		$	795		$	1,192		$	1,282		$	1,313		$	4,582
Core adjusted combined operating income(2)	$	1,262		$	940		$	1,303		$	1,393		$	1,424		$	5,060
Pro forma net income attributable to controlling shareholders	$	756		$	1,224		$	794		$	861		$	1,274		$	4,153
Core adjusted combined income(2)	$	840		$	628		$	882		$	945		$	1,066		$	3,521
Pro forma diluted earnings per share	$	0.81		$	1.31		$	0.85		$	0.92		$	1.37		$	4.45
Core adjusted combined diluted earnings per share(2)	$	0.90		$	0.67		$	0.95		$	1.01		$	1.14		$	3.77
Weighted average number of diluted shares outstanding (millions)	933.5			932.7			932.6			932.9			933.2			932.9

(1) Combined operating ratio is defined as pro forma operating expenses divided by pro forma revenues.

(2) These measures are Non-GAAP measures, and have no standardized meanings prescribed by accounting principles generally accepted in the United States (“GAAP”) and, therefore, may not be comparable to similar measures presented by other companies. These measures are defined and reconciled in Part III Non-GAAP Measures.

3

Part II - Regulation S-X Article 11 - Pro forma Financial Information (unaudited)

1.Summary of Pro Forma Financial Information

	For the quarter ended										For the year ended
(in millions of Canadian dollars, except per share data)	03/31/23		03/31/22		06/30/22		09/30/22		12/31/22		12/31/22
Revenues
Freight	$	3,385	$	2,765	$	3,220	$	3,394	$	3,566	$	12,945
Non-freight	71		62		65		72		73		272
Total revenues	3,456		2,827		3,285		3,466		3,639		13,217
Operating expenses
Compensation and benefits	650		587		527		601		615		2,330
Fuel	475		396		528		516		562		2,002
Materials	98		80		86		91		94		351
Material and other	—		—		—		—		—		—
Equipment rents	70		60		60		67		77		264
Depreciation and amortization	441		408		412		419		433		1,672
Purchased services and other	565		501		480		490		545		2,016
Merger costs	—		—		—		—		—		—
Total operating expenses	2,299		2,032		2,093		2,184		2,326		8,635
Operating income	1,157		795		1,192		1,282		1,313		4,582
Less:
Equity earnings of Kansas City Southern	—		—		—		—		—		—
Other expense (income)	25		(11)		16		24		(324)		(295)
Other components of net periodic benefit recovery	(85)		(100)		(101)		(101)		(112)		(414)
Equity in net earnings of affiliates	—		—		—		—		—		—
Foreign exchange loss	—		—		—		—		—		—
Gain on settlement of treasury lock agreements	—		—		—		—		—		—
Net interest expense	210		213		214		220		222		869
Remeasurement loss of Kansas City Southern	—		7,175		—		—		—		7,175
Income (loss) before income tax expense (recovery)	1,007		(6,482)		1,063		1,139		1,527		(2,753)
Less:
Current income tax expense	219		148		210		235		272		865
Deferred tax expense (recovery)	32		(7,855)		59		43		(20)		(7,773)
Income tax expense (recovery)	251		(7,707)		269		278		252		(6,908)
Net income	$	756	$	1,225	$	794	$	861	$	1,275	$	4,155
Less: Net income attributable to non-controlling interest	—		1		—		—		1		2
Net income attributable to controlling shareholders	$	756	$	1,224	$	794	$	861	$	1,274	$	4,153
Earnings per share
Basic earnings per share	$	0.81	$	1.32	$	0.85	$	0.93	$	1.37	$	4.47
Diluted earnings per share	$	0.81	$	1.31	$	0.85	$	0.92	$	1.37	$	4.45

See “Pro Forma Consolidated Statement of Income” schedules for details about pro forma transaction accounting adjustments applied to each period presented.

4

2.Pro Forma Consolidated Statement of Income (unaudited)

For the first quarter ended March 31, 2023

(in millions of Canadian dollars, except per share data)	Historical Canadian Pacific Railway Limited		Adjusted Historical Kansas City Southern (Note 3)		Transaction Accounting Adjustments		Note	Consolidated
Revenues
Freight	$	2,217	$	—	$	1,167	4a	$	3,385
					1		4g
Non-freight	49		—		23		4a	71
					(1)		4g
Revenues	—		1,187		(1,187)		4a	—
Total revenues	2,266		1,187		3			3,456
Operating expenses
Compensation and benefits	438		211		1		4a	650
Fuel	326		149		—			475
Materials	72		—		26		4a	98
Materials and other	—		140		(140)		4a	—
Equipment rents	30		39		1		4a	70
Depreciation and amortization	225		136		80		4f	441
Purchased services and other	346		92		127		4a	565
Merger costs	—		12		(12)		4a	—
Total operating expenses	1,437		779		83			2,299
Operating income	829		408		(80)			1,157
Less:
Equity earnings of Kansas City Southern	(204)		—		204		4b	—
Other expense (income)	2		(1)		23		4a	25
					1		4f
Other components of net periodic benefit recovery	(86)		—		1		4a	(85)
Net interest expense	154		53		(2)		4a	210
					5		4d
Equity in net earnings of affiliates	—		(3)		3		4a	—
Foreign exchange loss	—		25		(25)		4a	—
Income before income tax expense	963		334		(290)			1,007
Less:
Current income tax expense	139		80		—		4e	219
Deferred tax expense	24		8		—		4e	32
Income tax expense	163		88		—			251
Net income	$	800	$	246	$	(290)		$	756
Less: Net income attributable to non-controlling interest	—		—		—			—
Net income attributable to controlling shareholders	$	800	$	246	$	(290)		$	756
Earnings per share
Basic earnings per share	$	0.86					4i	$	0.81
Diluted earnings per share	$	0.86					4i	$	0.81

5

3.Pro Forma Consolidated Statement of Income (unaudited)

For the first quarter ended March 31, 2022

(in millions of Canadian dollars, except per share data)	Historical Canadian Pacific Railway Limited		Adjusted Historical Kansas City Southern (Note 3)		Transaction Accounting Adjustments		Note	Consolidated
Revenues
Freight	$	1,796	$	—	$	968	4a	$	2,765
					1		4g
Non-freight	42		—		21		4a	62
					(1)		4g
Revenues	—		986		(986)		4a	—
Total revenues	1,838		986		3			2,827
Operating expenses
Compensation and benefits	413		168		6		4a	587
Fuel	273		123		—			396
Materials	62		—		18		4a	80
Materials and other	—		99		(99)		4a	—
Equipment rents	35		24		1		4a	60
Depreciation and amortization	210		122		76		4f	408
Purchased services and other	310		65		93		4a	501
					33		4c
Merger costs	—		16		(16)		4a	—
Total operating expenses	1,303		617		112			2,032
Operating income	535		369		(109)			795
Less:
Equity earnings of Kansas City Southern	(198)		—		198		4b	—
Other income	(1)		(1)		(10)		4a	(11)
					1		4f
Other components of net periodic benefit recovery	(101)		—		1		4a	(100)
Net interest expense	160		49		(1)		4a	213
					5		4d
Remeasurement loss of Kansas City Southern	—		—		7,175		4h	7,175
Equity in net earnings of affiliates	—		(12)		12		4a	—
Foreign exchange loss	—		2		(2)		4a	—
Income (loss) before income tax expense (recovery)	675		331		(7,488)			(6,482)
Less:
Current tax expense	86		71		(9)		4c,4e	148
Deferred tax (recovery) expense	(1)		21		(7,875)		4e	(7,855)
Income tax expense (recovery)	85		92		(7,884)			(7,707)
Net income	$	590	$	239	$	396		$	1,225
Less: Net income attributable to non-controlling interest	—		1		—			1
Net income attributable to controlling shareholders	$	590	$	238	$	396		$	1,224
Earnings per share
Basic earnings per share	$	0.63					4i	$	1.32
Diluted earnings per share	$	0.63					4i	$	1.31

6

4.Pro Forma Consolidated Statement of Income (unaudited)

For the second quarter ended June 30, 2022

(in millions of Canadian dollars, except per share data)	Historical Canadian Pacific Railway Limited		Adjusted Historical Kansas City Southern (Note 3)		Transaction Accounting Adjustments		Note	Consolidated
Revenues
Freight	$	2,154	$	—	$	1,065	4a	$	3,220
					1		4g
Non-freight	48		—		18		4a	65
					(1)		4g
Revenues	—		1,079		(1,079)		4a	—
Total revenues	2,202		1,079		4			3,285
Operating expenses
Compensation and benefits	348		173		6		4a	527
Fuel	370		158		—			528
Materials	63		—		23		4a	86
Materials and other	—		108		(108)		4a	—
Equipment rents	29		29		2		4a	60
Depreciation and amortization	211		125		76		4f	412
Purchased services and other	313		70		97		4a	480
Merger costs	—		16		(16)		4a	—
Total operating expenses	1,334		679		80			2,093
Operating income	868		400		(76)			1,192
Less:
Equity earnings of Kansas City Southern	(208)		—		208		4b	—
Other expense	7		1		8		4a	16
					—		4f
Other components of net periodic benefit recovery	(101)		—		—		4a	(101)
Net interest expense	160		51		(2)		4a	214
					5		4d
Equity in net losses of affiliates	—		1		(1)		4a	—
Foreign exchange loss	—		6		(6)		4a	—
Income before income tax expense	1,010		341		(288)			1,063
Less:
Current income tax expense	131		78		1		4a	210
Deferred tax expense	114		16		(71)		4e	59
Income tax expense	245		94		(70)			269
Net income	$	765	$	247	$	(218)		$	794
Less: Net income attributable to non-controlling interest	—		—		—			—
Net income attributable to controlling shareholders	$	765	$	247	$	(218)		$	794
Earnings per share
Basic earnings per share	$	0.82					4i	$	0.85
Diluted earnings per share	$	0.82					4i	$	0.85

7

5.Pro Forma Consolidated Statement of Income (unaudited)

For the third quarter ended September 30, 2022

(in millions of Canadian dollars, except per share data)	Historical Canadian Pacific Railway Limited		Adjusted Historical Kansas City Southern (Note 3)		Transaction Accounting Adjustments		Note	Consolidated
Revenues
Freight	$	2,264	$	—	$	1,129	4a	$	3,394
					1		4g
Non-freight	48		—		25		4a	72
					(1)		4g
Revenues	—		1,151		(1,151)		4a	—
Total revenues	2,312		1,151		3			3,466
Operating expenses
Compensation and benefits	393		202		6		4a	601
Fuel	358		158		—			516
Materials	66		—		25		4a	91
Materials and other	—		117		(117)		4a	—
Equipment rents	33		33		1		4a	67
Depreciation and amortization	213		128		78		4f	419
Purchased services and other	312		75		103		4a	490
Merger costs, net	—		15		(15)		4a	—
Total operating expenses	1,375		728		81			2,184
Operating income	937		423		(78)			1,282
Less:
Equity earnings of Kansas City Southern	(221)		—		221		4b	—
Other expense	7		—		16		4a	24
					1		4f
Other components of net periodic benefit recovery	(102)		—		1		4a	(101)
Net interest expense	166		51		(2)		4a	220
					5		4d
Equity in net earnings of affiliates	—		—		—		4a	—
Foreign exchange loss	—		16		(16)		4a	—
Income before income tax expense	1,087		356		(304)			1,139
Less:
Current income tax expense	158		76		1		4a	235
Deferred tax expense	38		18		(13)		4e	43
Income tax expense	196		94		(12)			278
Net income	$	891	$	262	$	(292)		$	861
Less: Net income attributable to non-controlling interest	—		—		—			—
Net income attributable to controlling shareholders	$	891	$	262	$	(292)		$	861
Earnings per share
Basic earnings per share	$	0.96					4i	$	0.93
Diluted earnings per share	$	0.96					4i	$	0.92

8

6.Pro Forma Consolidated Statement of Income (unaudited)

For the fourth quarter ended December 31, 2022

(in millions of Canadian dollars, except per share data)	Historical Canadian Pacific Railway Limited		Adjusted Historical Kansas City Southern (Note 3)		Transaction Accounting Adjustments		Note	Consolidated
Revenues
Freight	$	2,413	$	—	$	1,152	4a	$	3,566
					1		4g
Non-freight	49		—		25		4a	73
					(1)		4g
Revenues	—		1,174		(1,174)		4a	—
Total revenues	2,462		1,174		3			3,639
Operating expenses
Compensation and benefits	416		195		4		4a	615
Fuel	399		163		—			562
Materials	69		—		25		4a	94
Materials and other	—		146		(146)		4a	—
Equipment rents	43		33		1		4a	77
Depreciation and amortization	219		134		80		4f	433
Purchased services and other	327		85		133		4a	545
Merger costs, net	—		14		(14)		4a	—
Total operating expenses	1,473		770		83			2,326
Operating income	989		404		(80)			1,313
Less:
Equity earnings of Kansas City Southern	(447)		—		447		4b	—
Other expense (income)	4		(6)		(323)		4a	(324)
					1		4f
Other components of net periodic benefit recovery	(107)		—		(5)		4a	(112)
Net interest expense	166		53		(2)		4a	222
					5		4d
Equity in net earnings of affiliates	—		(1)		1		4a	—
Gain on settlement of treasury lock agreements	—		(349)		349		4a	—
Foreign exchange loss	—		20		(20)		4a	—
Income before income tax expense	1,373		687		(533)			1,527
Less:
Current income tax expense	117		155		—		4e	272
Deferred tax recovery	(15)		(9)		4		4e	(20)
Income tax expense	102		146		4			252
Net income	$	1,271	$	541	$	(537)		$	1,275
Less: Net income attributable to non-controlling interest	—		1		—			1
Net income attributable to controlling shareholders	$	1,271	$	540	$	(537)		$	1,274
Earnings per share
Basic earnings per share	$	1.37					4i	$	1.37
Diluted earnings per share	$	1.36					4i	$	1.37

9

7.Pro Forma Consolidated Statement of Income (unaudited)

For the year ended December 31, 2022

(in millions of Canadian dollars, except per share data)	Historical Canadian Pacific Railway Limited		Adjusted Historical Kansas City Southern (Note 3)		Transaction Accounting Adjustments		Note	Consolidated
Revenues
Freight	$	8,627	$	—	$	4,314	4a	$	12,945
					4		4g
Non-freight	187		—		89		4a	272
					(4)		4g
Revenues	—		4,390		(4,390)		4a	—
Total revenues	8,814		4,390		13			13,217
Operating expenses
Compensation and benefits	1,570		738		22		4a	2,330
Fuel	1,400		602		—			2,002
Materials	260		—		91		4a	351
Materials and other	—		470		(470)		4a	—
Equipment rents	140		119		5		4a	264
Depreciation and amortization	853		509		310		4f	1,672
Purchased services and other	1,262		295		426		4a	2,016
					33		4c
Merger costs, net	—		61		(61)		4a	—
Total operating expenses	5,485		2,794		356			8,635
Operating income	3,329		1,596		(343)			4,582
Less:
Equity earnings of Kansas City Southern	(1,074)		—		1,074		4b	—
Other expense (income)	17		(6)		(309)		4a	(295)
					3		4f
Other components of net periodic benefit recovery	(411)		—		(3)		4a	(414)
Net interest expense	652		204		(7)		4a	869
					20		4d
Remeasurement loss of Kansas City Southern	—		—		7,175		4h	7,175
Equity in net earnings of affiliates	—		(12)		12		4a	—
Gain on settlement of treasury lock agreements	—		(349)		349		4a	—
Foreign exchange loss	—		44		(44)		4a	—
Income (loss) before income tax expense (recovery)	4,145		1,715		(8,613)			(2,753)
Less:
Current income tax expense	492		380		2		4a	865
					(9)		4e
Deferred tax expense (recovery)	136		46		(7,955)		4e	(7,773)
Income tax expense (recovery)	628		426		(7,962)			(6,908)
Net income	$	3,517	$	1,289	$	(651)		$	4,155
Less: Net income attributable to non-controlling interest	—		2		—			2
Net income attributable to controlling shareholders	$	3,517	$	1,287	$	(651)		$	4,153
Earnings per share
Basic earnings per share	$	3.78					4i	$	4.47
Diluted earnings per share	$	3.77					4i	$	4.45

10

8.    Pro Forma Explanatory Notes

(1)Basis of Presentation

The unaudited Pro Forma Consolidated Statement of Income for the first quarter ended March 31, 2023, each of the four quarters of 2022, and the year ended December 31, 2022 (the “Pro Forma Consolidated Statement of Income”) was prepared in accordance with Regulation S-X Article 11 (“Article 11”) to illustrate the estimated effects of the acquisition and other related transactions and adjustments described below (collectively, the “adjustments” or “transaction accounting adjustments”) as if they had occurred on January 1, 2022. Quarterly data within the Pro forma Consolidated Statement of Income is derived through apportioning adjustments contained in the full year Pro forma Consolidated Statement of Income to the quarter to which the adjustments relate, as further detailed below, with no change to underlying assumptions.

Adjustments in the Pro forma Consolidated Statement of Income to align KCS’s income statement amounts to CPRL’s presentation, to recognize CPRL’s transaction costs expected to be incurred, and the associated income tax impacts of recognizing these costs are defined here as “other adjustments”. For the purposes of the Pro Forma Consolidated Statement of Income, all of the transaction costs incurred and expected to be incurred by CPRL to effect the acquisition have been included as “other adjustments” on the basis that all such costs are incurred to achieve the acquisition.

The Pro forma Consolidated Statement of Income reflects pro forma adjustments CPRL believes are necessary to present fairly CPKC’s pro forma results of income following the completion of the acquisition as of and for the periods indicated. The pro forma adjustments are based on currently available information and assumptions CPRL believes are, under the circumstances and given the information available at this time, reasonable, directly attributable to the acquisition, and reflective of adjustments necessary to report CPKC’s results of operations as if CPRL completed the acquisition. The Pro forma Consolidated Statement of Income does not include adjustments to reflect any potential revenue or operational synergies, cost savings that may be achievable in connection with the acquisition, normalization to eliminate transaction costs recognized by CPRL and KCS for the first quarter ended March 31, 2023 and the year ended December 31, 2022, or incremental estimated integration costs.

The Pro forma Consolidated Statement of Income is based on various adjustments and assumptions and is not necessarily indicative of what CPKC’s consolidated statement of income actually would have been, had the acquisition and other adjustments been completed as of the dates indicated, or will be, for any future periods. The Pro forma Consolidated Statement of Income does not purport to project the future operating results of CPKC following the completion of the acquisition.

(2) Principles of Consolidation

The Pro Forma Consolidated Statement of Income has been prepared to reflect CPRL’s accounting for the acquisition as a purchase of KCS using the acquisition method pursuant to Accounting Standards Codification 805 “Business Combinations” (“ASC 805”). Under the acquisition method, CPRL’s previously held interest in KCS is remeasured to its Control Date fair value on the Control Date.

The adjustments to the Pro Forma Consolidated Statement of Income are preliminary and have been made solely for the purpose of presenting the Pro Forma Consolidated Statement of Income, which are necessary to comply with applicable disclosure and reporting requirements. The purchase price allocation is pending finalization of various estimates, inputs and analyses. Since the Pro Forma Consolidated Statement of Income has been prepared based on preliminary estimates of fair values attributable to the purchase of KCS, the actual amounts eventually recorded for the remeasurement of CPRL’s equity investment in KCS and purchase accounting may differ materially from the information presented. For the Pro Forma Consolidated Statement of Income, the purchase price allocation has been prepared using information available to CPRL under the terms of the U.S. Surface Transportation Board protective order in force until CPRL obtained control of KCS. As a result of obtaining control on the Control Date, CPKC now has access to all KCS information necessary to finalize the purchase price allocation during a measurement period not to exceed 12 months from the Control Date. Until the purchase price allocation is finalized it is preliminary.

(3)Presentation Currency

The Pro Forma Consolidated Statements of Income are presented in Canadian dollars, while the consolidated income statements of KCS are presented in U.S. dollars. The consolidated income statements of KCS has been translated in the pro forma consolidated statements of income to Canadian dollars at the daily exchange rate for revenues and the average monthly exchange rate for all remaining expenses and income.

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Statement of income

For the first quarter ended March 31, 2023

(in millions)	Historical Kansas City Southern as reported in U.S. dollars		Translated adjusted Historical Kansas City Southern in Canadian dollars (1)
Revenues	$	877	$	1,187
Operating expenses
Compensation and benefits	156		211
Fuel	110		149
Materials and other	103		140
Equipment costs	28		39
Depreciation and amortization	101		136
Purchased services	68		92
Merger costs, net	9		12
Total operating expenses	575		779
Operating income	302		408
Less:
Other income, net	(1)		(1)
Interest expense	39		53
Equity in net earnings of affiliates	(2)		(3)
Foreign exchange loss	19		25
Income before income tax	247		334
Current income tax expense	59		80
Deferred tax expense	6		8
Net income	182		246
Less: Net income attributable to non-controlling interest	—		—
Net income attributable to controlling shareholders	$	182	$	246

(1) Revenues are translated into Canadian dollars at the Bank of Canada daily exchange rate for the first quarter ended March 31, 2023 with effective exchange rate of $1.3526 and all remaining expenses and income are translated at the Bank of Canada monthly average exchange rate for the first quarter ended March 31, 2023 with effective exchange rate of $1.3526.

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Statement of income

For the first quarter ended March 31, 2022

(in millions)	Historical Kansas City Southern as reported in U.S. dollars		Translated adjusted Historical Kansas City Southern in Canadian dollars (1)
Revenues	$	778	$	986
Operating expenses
Compensation and benefits	133		168
Fuel	97		123
Materials and other	78		99
Equipment costs	19		24
Depreciation and amortization	96		122
Purchased services	51		65
Merger costs, net	13		16
Total operating expenses	487		617
Operating income	291		369
Less:
Other income, net	(1)		(1)
Interest expense	39		49
Equity in net earnings of affiliates	(9)		(12)
Foreign exchange loss	1		2
Income before income tax	261		331
Current income tax expense	57		71
Deferred tax expense	16		21
Net income	188		239
Less: Net income attributable to non-controlling interest	1		1
Net income attributable to controlling shareholders	$	187	$	238

(1) Revenues are translated into Canadian dollars at the Bank of Canada daily exchange rate for the first quarter ended March 31, 2022 with effective exchange rate of $1.2668 and all remaining expenses and income are translated at the Bank of Canada monthly average exchange rate for the first quarter ended March 31, 2022 with effective exchange rate of $1.2669.

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Statement of income

For the second quarter ended June 30, 2022

(in millions)	Historical Kansas City Southern as reported in U.S. dollars		Translated adjusted Historical Kansas City Southern in Canadian dollars (1)
Revenues	$	846	$	1,079
Operating expenses
Compensation and benefits	136		173
Fuel	123		158
Materials and other	85		108
Equipment costs	23		29
Depreciation and amortization	98		125
Purchased services	55		70
Merger costs, net	13		16
Total operating expenses	533		679
Operating income	313		400
Less:
Other expense	1		1
Interest expense	40		51
Equity in net loss of affiliates	1		1
Foreign exchange loss	4		6
Income before income tax	267		341
Current income tax expense	62		78
Deferred tax expense	11		16
Net income	194		247
Less: Net income attributable to non-controlling interest	—		—
Net income attributable to controlling shareholders	$	194	$	247

(1) Revenues are translated into Canadian dollars at the Bank of Canada daily exchange rate for the second quarter ended June 30, 2022 with effective exchange rate of $1.2762 and all remaining expenses and income are translated at the Bank of Canada monthly average exchange rate for the second quarter ended June 30, 2022 with effective exchange rate of $1.2763.

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Statement of income

For the third quarter ended September 30, 2022

(in millions)	Historical Kansas City Southern as reported in U.S. dollars		Translated adjusted Historical Kansas City Southern in Canadian dollars (1)
Revenues	$	882	$	1,151
Operating expenses
Compensation and benefits	154		202
Fuel	121		158
Materials and other	89		117
Equipment costs	26		33
Depreciation and amortization	98		128
Purchased services	58		75
Merger costs, net	11		15
Total operating expenses	557		728
Operating income	325		423
Less:
Interest expense	39		51
Foreign exchange loss	12		16
Income before income tax	274		356
Current income tax expense	58		76
Deferred tax expense	15		18
Net income	201		262
Less: Net income attributable to non-controlling interest	—		—
Net income attributable to controlling shareholders	$	201	$	262

(1) Revenues are translated into Canadian dollars at the Bank of Canada daily exchange rate for the third quarter ended September 30, 2022 with effective exchange rate of $1.3041 and all remaining expenses and income are translated at the Bank of Canada monthly average exchange rate for the third quarter ended September 30, 2022 with effective exchange rate of $1.3048.

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Statement of income

For the fourth quarter ended December 31, 2022

(in millions)	Historical Kansas City Southern as reported in U.S. dollars		Translated adjusted Historical Kansas City Southern in Canadian dollars (1)
Revenues	$	864	$	1,174
Operating expenses
Compensation and benefits	144		195
Fuel	121		163
Materials and other	108		146
Equipment costs	23		33
Depreciation and amortization	99		134
Purchased services	62		85
Merger costs, net	9		14
Total operating expenses	566		770
Operating income	298		404
Less:
Other income, net	(4)		(6)
Interest expense	38		53
Equity in net earnings of affiliates	(1)		(1)
Gain on settlement of treasury lock agreements	(259)		(349)
Foreign exchange loss	16		20
Income before income tax	508		687
Current income tax expense	114		155
Deferred tax recovery	(7)		(9)
Net income	401		541
Less: Net income attributable to non-controlling interest	1		1
Net income attributable to controlling shareholders	$	400	$	540

(1) Revenues are translated into Canadian dollars at the Bank of Canada daily exchange rate for the fourth quarter ended December 31, 2022 with effective exchange rate of $1.3582 and all remaining expenses and income are translated at the Bank of Canada monthly average exchange rate for the fourth quarter ended December 31, 2022 with effective exchange rate of $1.3641.

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Statement of income

For the year ended December 31, 2022

(in millions)	Historical Kansas City Southern as reported in U.S. dollars		Translated adjusted Historical Kansas City Southern in Canadian dollars (1)
Revenues	$	3,370	$	4,390
Operating expenses
Compensation and benefits	567		738
Fuel	462		602
Materials and other	360		470
Equipment costs	91		119
Depreciation and amortization	391		509
Purchased services	226		295
Merger costs, net	46		61
Total operating expenses	2,143		2,794
Operating income	1,227		1,596
Less:
Other income, net	(4)		(6)
Interest expense	156		204
Equity in net earnings of affiliates	(9)		(12)
Gain on settlement of treasury lock agreements	(259)		(349)
Foreign exchange loss	33		44
Income before income tax	1,310		1,715
Current income tax expense	291		380
Deferred tax expense	35		46
Net income	984		1,289
Less: Net income attributable to non-controlling interest	2		2
Net income attributable to controlling shareholders	$	982	$	1,287

(1) Revenues are translated into Canadian dollars at the Bank of Canada daily exchange rate for the year ended December 31, 2022 with effective exchange rate of $1.3025 and all remaining expenses and income are translated at the Bank of Canada monthly average exchange rate for the year ended December 31, 2022 with effective exchange rate of $1.2993.

(4) Pro forma Transaction Accounting Adjustments

a. Reclassification adjustments

The following reclassification adjustments have been made in the Pro Forma Consolidated Statements of income based on underlying quarterly information:

•KCS’s revenue has been bifurcated into Freight and Non-freight revenue, consistent with CPKC’s financial statement captions;

•CPKC does not present a financial statement caption representing Materials and other. Amounts classified in this caption by KCS have been reclassified into Materials and Purchased services and other, consistent with CPKC’s financial statement captions;

•CPKC includes billings to third parties for the recovery of costs incurred for freight car repairs in Compensation and benefits and Materials. The cost recoveries recognized by KCS in Purchased services have been reclassified into these captions;

•CPKC does not present a financial statement caption representing Merger costs. Amounts classified in this caption by KCS have been reclassified into Compensation and benefits and Purchased services and other, consistent with CPKC’s financial statement captions;

•CPKC includes foreign exchange gains and losses in the financial statement caption titled Other expense. The foreign exchange losses incurred by KCS have been reclassified into this caption;

•CPKC includes gains and losses on interest rate hedges in the financial statement caption titled Other expense. KCS’s gain on interest rate hedge unwind has been reclassified into this caption; and

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•additional miscellaneous amounts associated with items of lower value presented by KCS have been reclassified across Non-freight revenue, Operating expenses, non-operating income or expense, and Current income tax expense, consistent with CPKC’s financial statement captions.

b. Previously held equity method investment

Equity earnings from KCS were recognized in Equity earnings in Kansas City Southern by CPRL. These equity earnings have been removed from the pro forma consolidated statements of income.

The following table shows the amount removed for each period presented:

	For the quarter ended										For the year ended
(in millions of Canadian dollars)	March 31, 2023		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022		December 31, 2022
Equity earnings of KCS	$	204	$	198	$	208	$	221	$	447	$	1,074

c. Transaction and merger costs

The amount of transaction costs expected to be incurred by CPKC of $33 million to complete the acquisition of KCS and the associated current tax recovery on transaction costs of $9 million have been recognized within Purchased services and other in the Pro Forma Consolidated Statement of Income for the first quarter ended March 31, 2022 as if the Control Date had occurred on January 1, 2022. The estimated transaction costs and related tax deductibility are preliminary and may change. The costs incurred are non-recurring in nature.

d. Debt and finance expenses

The debt of KCS assumed at the Control Date was recorded in the preliminary purchase price allocation at fair value. The change in fair value of approximately $500 million is amortized into Net interest expense over the remaining term of the underlying debt instruments using the effective interest method. As a result, an adjustment has been recorded as an increase to Net interest expense in the pro forma consolidated statements of income and is reflected ratably on a quarterly basis.

The following table shows the amortization of change in fair value for each period presented:

	For the quarter ended										For the year ended
(in millions of Canadian dollars)	March 31, 2023		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022		December 31, 2022
Net interest expense	$	5	$	5	$	5	$	5	$	5	$	20

e. Income tax (recovery) expense

The adjustment to Income tax (recovery) expense relates to:

•a current tax recovery on transaction costs expected to be incurred by CPKC in the first quarter ended March 31, 2022 as if the Control Date had occurred on January 1, 2022;

•a deferred tax recovery related to the elimination of the deferred tax liability on the outside basis difference of the investment in KCS in the first quarter ended March 31, 2022 as if the Control Date had occurred on January 1, 2022;

•deferred tax expenses and recoveries on elimination of changes in the outside basis difference of the previously held equity investment in KCS in the first quarter ended March 31, 2023, each of the four quarters of 2022, and for the year ended December 31, 2022, as if the Control Date had occurred on January 1, 2022;

•a deferred tax recovery on amortization of fair value adjustments to investments, properties, intangible assets and debt and is reflected ratably on a quarterly basis; and

•a deferred tax recovery on CPKC unitary state apportionment changes in the first quarter ended March 31, 2022 as if the Control Date had occurred on January 1, 2022.

The tax effect is calculated based on the statutory rates in effect in the underlying taxation jurisdiction during the periods, which are estimated between 23% and 30% for CPKC for the first quarter ended March 31, 2023 and for the year ended December 31, 2022. The tax treatment and applicable tax rates of the pro forma adjustments are preliminary and may change.

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The following table shows the current and deferred tax amount adjusted for each period presented:

	For the quarter ended										For the year ended
(in millions of Canadian dollars)	March 31, 2023		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022		December 31, 2022
Current tax recovery on transaction costs	$	—	$	(9)	$	—	$	—	$	—	$	(9)
Elimination of outside basis deferred tax liability	$	—	$	(7,838)	$	—	$	—	$	—	$	(7,838)
Deferred tax expense (recovery) on the elimination of equity earnings of KCS	23		32		(49)		9		27		19
Deferred tax recovery on amortization of fair value adjustments to investments, properties, intangible assets and debt	(23)		(21)		(22)		(22)		(23)		(88)
Revaluation of deferred income tax on unitary state apportionment changes	—		(48)		—		—		—		(48)
Total Deferred tax (recovery) expense	$	—	$	(7,875)	$	(71)	$	(13)	$	4	$	(7,955)

f. Depreciation and amortization expense

An adjustment to Depreciation and amortization in the Pro Forma Consolidated Statements of income has been made to reflect incremental depreciation and amortization in relation to preliminary fair value adjustments to properties and intangible assets of approximately $19,100 million. In addition, an adjustment has been made to Other (income) expense to reflect incremental amortization in relation to preliminary fair value adjustments to KCS’s investments of approximately $200 million. These adjustments are reflected ratably on a quarterly basis. When CPKC has finalized its determination of the fair value of properties, the value ultimately determined could be materially different.

The following table shows the depreciation of the change in fair value to properties and intangible assets and amortization of the change in fair value of KCS’s investments for each period presented:

	For the quarter ended										For the year ended
(in millions of Canadian dollars)	March 31, 2023		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022		December 31, 2022
Depreciation and amortization	$	80	$	76	$	76	$	78	$	80	$	310
Other (income) expense	1		1		—		1		1		3

For every $1 billion recorded as depreciable and amortizable assets, the annual depreciation and amortization expense would increase by $30 million, assuming a 3% depreciation and amortization rate. The depreciation and amortization rate of 3% approximates CPRL’s and KCS’s estimated annual rates of depreciation and amortization.

g. Intercompany transactions

Intercompany transactions between CPRL and KCS have been eliminated in the Pro Forma Statement of Income based on underlying quarterly information.

h. Remeasurement loss of Kansas City Southern

Pro forma adjustments to derecognize CPRL’s previously held equity method investment in KCS of $44,403 million and remeasure to its Control Date fair value, which is $37,226 million and forms part of the purchase consideration, have been recorded, resulting in a loss of $7,177 million. The remeasurement loss is primarily due to the reversal of the portion of the carrying value of the equity investment in KCS related to the deferred tax liability previously recognized on the outside basis. Associated accumulated other comprehensive income of $2 million has been reclassified to retained earnings and is included in the calculation of loss on remeasurement resulting in a net remeasurement loss of $7,175 million and is recorded in the first quarter ended March 31, 2022 as if the Control Date had occurred on January 1, 2022.

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i. Pro forma earnings per share

No additional shares of CPRL were issued to effect the transactions reflected in the Pro Forma Consolidated Statement of Income, and therefore the number of weighted average shares outstanding in the calculation of Earnings per share, both basic and diluted, is unchanged.

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Part III - Non-GAAP Measures

CPKC presents Non-GAAP measures to provide a basis for evaluating underlying earnings in CPKC’s business that can be compared with the results of operations in prior periods. In addition, these Non-GAAP measures facilitate a multi-period assessment of long-term profitability, allowing management and other external users of CPKC’s combined financial information to compare profitability on a long-term basis, including assessing future profitability, with that of CPKC’s peers.

These Non-GAAP measures have no standardized meaning and are not defined by GAAP and, therefore, may not be comparable to similar measures presented by other companies. The presentation of these Non-GAAP measures is not intended to be considered in isolation from, as a substitute for, or as superior to the financial information presented in accordance with GAAP.

Non-GAAP Performance Measures

CPKC uses adjusted earnings results including Core adjusted combined operating income, Core adjusted combined operating ratio, Core adjusted combined income, and Core adjusted combined diluted earnings per share to evaluate CPKC’s operating performance and for planning and forecasting future business operations and future profitability while isolating for the impact of recording the KCS business combination. KCS purchase accounting represents the amortization of basis differences being the incremental depreciation and amortization in relation to fair value adjustments to properties and intangible assets, incremental amortization in relation to fair value adjustments to KCS’s investments, and amortization of the change in fair value of debt of KCS assumed at the Control Date, as recognized within Depreciation and amortization, Other (income) expense, and Net interest expense, respectively, in the Company's Pro Forma Consolidated Statements of Income. All assets subject to KCS purchase accounting contribute to income generation and will continue to amortize over their estimated useful lives. These Non-GAAP measures provide meaningful supplemental information regarding operating results because they exclude certain significant items that are not considered indicative of future financial trends either by nature or amount or provide improved comparability to past performance. As a result, these items are excluded for management's assessment of operational performance, allocation of resources, and preparation of annual budgets. These significant items include, but are not limited to, KCS's gain on unwinding of interest rate hedges, acquisition-related costs, changes in the outside basis tax difference between the carrying amount of CPKC's equity investment in KCS and its tax basis of this investment, loss on derecognition of CPKC’s previously held equity method investment in KCS and remeasurement at its Control Date fair value, changes in income tax rates, and changes to an uncertain tax item. Acquisition-related costs include legal, consulting, financing fees, integration planning costs consisting of third-party services and system migration, debt exchange transaction costs, community investments, and transaction and integration costs incurred by KCS. These items may not be non-recurring. However, excluding these significant items from GAAP results allows for a consistent understanding of the CPKC's combined financial performance when performing a multi-period assessment including assessing the likelihood of future results. Accordingly, these Non-GAAP financial measures may provide insight to investors and other external users of the CPKC's combined financial information.

In the first quarter of 2023, there was one significant item included in CPKC Pro forma Net income as follows:

•Acquisition-related costs of $28 million ($21 million after current tax recovery of $7 million), including costs of $11 million recognized in Compensation and benefits, $14 million recognized in Purchased services and other, and $3 million recognized in Other (income) expense that unfavourably impacted Pro forma Diluted EPS by 2 cents.

In 2022, there were six significant items included in CPKC Pro forma Net income as follows:

•in the fourth quarter, a gain of $349 million recognized in Other (income) expense due to KCS's gain on unwinding of interest rate hedges ($265 million after deferred tax expense of $84 million) that favourably impacted Pro forma Diluted EPS by 28 cents;

•in the fourth quarter, a deferred tax recovery of $24 million as a result of a reversal of an uncertain tax item related to a prior period that favourably impacted Pro forma Diluted EPS by 3 cents;

•in the first quarter, a remeasurement loss of KCS of $7,175 million recognized in Remeasurement loss of Kansas City Southern due to the derecognition of CPKC’s previously held equity method investment in KCS and remeasurement at its Control Date fair value that unfavourably impacted Pro forma Diluted EPS by $7.69;

•in the first quarter, a deferred tax recovery of $7,838 million related to the elimination of the deferred tax liability on the outside basis difference of the investment in KCS as at January 1, 2022 that favourably impacted Pro forma Diluted EPS by $8.40;

•during the course of the year, acquisition-related costs of $168 million in connection with the KCS acquisition ($132 million after current tax recovery of $36 million), including costs of $55 million recognized in Compensation and benefits, and $113 million recognized in Purchased services and other, that unfavourably impacted Pro forma Diluted EPS by 14 cents as follows:

◦in the fourth quarter, acquisition-related costs of $31 million ($16 million after current tax recovery of $15 million), including costs of $12 million recognized in Compensation and benefits, and $19 million recognized in Purchased services and other, that unfavourably impacted Pro forma Diluted EPS by 2 cents;

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◦in the third quarter, acquisition-related costs of $33 million ($33 million after net tax of $nil), including costs of $14 million recognized in Compensation and benefits, and $19 million recognized in Purchased services and other, that unfavourably impacted Pro forma Diluted EPS by 3 cents;

◦in the second quarter, acquisition-related costs of $35 million ($29 million after current tax recovery of $6 million), including costs of $14 million recognized in Compensation and benefits, and $21 million recognized in Purchased services and other, that unfavourably impacted Pro forma Diluted EPS by 3 cents; and

◦in the first quarter, acquisition-related costs of $69 million ($54 million after current tax recovery of $15 million), including costs of $15 million recognized in Compensation and benefits, and $54 million recognized in Purchased services and other, that unfavourably impacted Pro forma Diluted EPS by 6 cents; and

•during the course of the year, income tax rate changes of $60 million that favourably impacted Pro forma Diluted EPS by 6 cents as follows:

◦in the third quarter, a deferred tax recovery of $12 million due to a decrease in the Iowa state tax rate that favourably impacted Pro forma Diluted EPS by 1 cent; and

◦in the first quarter, a deferred tax recovery of $48 million due to CPKC unitary state apportionment changes that favourably impacted Pro forma Diluted EPS by 5 cents.

KCS purchase accounting included in CPKC Pro forma Net income was as follows:

•In the first quarter of 2023, KCS purchase accounting of $86 million ($63 million after deferred tax recovery of $23 million), including costs of $80 million recognized in Depreciation and amortization, $5 million recognized in Net interest expense, and $1 million recognized in Other (income) expense, that unfavourably impacted Pro forma Diluted EPS by 7 cents.

•during the course of the year of 2022, KCS purchase accounting of $333 million ($245 million after deferred tax recovery of $88 million), including costs of $310 million recognized in Depreciation and amortization, $20 million recognized in Net interest expense, and $3 million recognized in Other (income) expense, that unfavourably impacted Pro forma Diluted EPS by 26 cents as follows:

◦in the fourth quarter, KCS purchase accounting of $86 million ($63 million after deferred tax recovery of $23 million), including costs of $80 million recognized in Depreciation and amortization, $5 million recognized in Net interest expense, and $1 million recognized in Other (income) expense, that unfavourably impacted Pro forma Diluted EPS by 6 cents;

◦in the third quarter, KCS purchase accounting of $84 million ($62 million after deferred tax recovery of $22 million), including costs of $78 million recognized in Depreciation and amortization, $5 million recognized in Net interest expense, and $1 million recognized in Other (income) expense, that unfavourably impacted Pro forma Diluted EPS by 7 cents;

◦in the second quarter, KCS purchase accounting of $81 million ($59 million after deferred tax recovery of $22 million), including costs of $76 million recognized in Depreciation and amortization, and $5 million recognized in Net interest expense, that unfavourably impacted Pro forma Diluted EPS by 7 cents; and

◦in the first quarter, KCS purchase accounting of $82 million ($61 million after deferred tax recovery of $21 million), including costs of $76 million recognized in Depreciation and amortization, $5 million recognized in Net interest expense, and $1 million recognized in Other (income) expense, that unfavourably impacted Pro forma Diluted EPS by 6 cents.

Reconciliation of GAAP Performance Measures to Non-GAAP Performance Measures

The following tables reconcile the most directly comparable measures presented in accordance with GAAP to the Non-GAAP measures:

Core adjusted combined operating income is calculated as Pro forma operating income less significant items.

	For the quarter ended										For the year ended
(in millions of Canadian dollars)	March 31, 2023		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022		December 31, 2022
CPKC Pro forma operating income	$	1,157	$	795	$	1,192	$	1,282	$	1,313	$	4,582
Less:
Acquisition-related costs	(25)		(69)		(35)		(33)		(31)		(168)
KCS purchase accounting in Depreciation and amortization	(80)		(76)		(76)		(78)		(80)		(310)
CPKC Core adjusted combined operating income	$	1,262	$	940	$	1,303	$	1,393	$	1,424	$	5,060

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Core adjusted combined operating ratio excludes those significant items that are reported within Pro forma operating income.

	For the quarter ended										For the year ended
	March 31, 2023		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022		December 31, 2022
CPKC Pro forma operating ratio	66.5	%	71.9	%	63.7	%	63.0	%	63.9	%	65.3	%
Less:
Acquisition-related costs	0.7	%	2.5	%	1.1	%	0.9	%	0.8	%	1.3	%
KCS purchase accounting in Depreciation and amortization	2.3	%	2.7	%	2.3	%	2.3	%	2.2	%	2.3	%
CPKC Core adjusted combined operating ratio	63.5	%	66.7	%	60.3	%	59.8	%	60.9	%	61.7	%

Core adjusted combined income is calculated as Pro forma net income attributable to controlling shareholders adjusted for significant items.

	For the quarter ended										For the year ended
(in millions of Canadian dollars)	March 31, 2023		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022		December 31, 2022
CPKC Pro forma net income attributable to controlling shareholders	$	756	$	1,224	$	794	$	861	$	1,274	$	4,153
Less:
KCS net gain on unwind of interest rate hedges	—		—		—		—		349		349
Acquisition-related costs	(28)		(69)		(35)		(33)		(31)		(168)
KCS purchase accounting	(86)		(82)		(81)		(84)		(86)		(333)
Remeasurement loss of Kansas City Southern	—		(7,175)		—		—		—		(7,175)
Add:
Tax effect of adjustments(1)	(30)		(36)		(28)		(21)		48		(37)
Reversal of deferred tax liability on the outside basis difference of the investment in KCS	—		(7,838)		—		—		—		(7,838)
Income tax rate changes	—		(48)		—		(12)		—		(60)
Reversal of provision for uncertain tax item	—		—		—		—		(24)		(24)
CPKC Core adjusted combined income	$	840	$	628	$	882	$	945	$	1,066	$	3,521

(1) The tax effect of adjustments was calculated as the pre-tax effect of the adjustments multiplied by the applicable tax rate for the above items of 27.03%, 0.49%, 24.14%, 17.95%, 20.69%, and 0.50% for the first quarter ended March 31, 2023, each of the four quarters of 2022, and the year ended December 31, 2022, respectively. The applicable tax rates reflect the taxable jurisdictions and nature, being on account of capital or income, of the significant items.

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Core adjusted combined diluted earnings per share is calculated as Pro forma diluted earnings per share less significant items.

	For the quarter ended										For the year ended
	March 31, 2023		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022		December 31, 2022
CPKC Pro forma diluted earnings per share	$	0.81	$	1.31	$	0.85	$	0.92	$	1.37	$	4.45
Less:
KCS net gain on unwind of interest rate hedges	—		—		—		—		0.37		0.37
Acquisition-related costs	(0.03)		(0.07)		(0.04)		(0.04)		(0.03)		(0.18)
KCS purchase accounting	(0.09)		(0.09)		(0.09)		(0.08)		(0.09)		(0.35)
Remeasurement loss of Kansas City Southern	—		(7.69)		—		—		—		(7.69)
Add:
Tax effect of adjustments(1)	(0.03)		(0.04)		(0.03)		(0.02)		0.05		(0.04)
Reversal of deferred tax liability on the outside basis difference of the investment in KCS	—		(8.40)		—		—		—		(8.40)
Income tax rate changes	—		(0.05)		—		(0.01)		—		(0.06)
Reversal of provision for uncertain tax item	—		—		—		—		(0.03)		(0.03)
CPKC Core adjusted combined diluted earnings per share	$	0.90	$	0.67	$	0.95	$	1.01	$	1.14	$	3.77

(1) The tax effect of adjustments was calculated as the pre-tax effect of the adjustments multiplied by the applicable tax rate for the above items of 27.03%, 0.49%, 24.14%, 17.95%, 20.69%, and 0.50% for the first quarter ended March 31 ,2023, each of the four quarters of 2022, and the year ended December 31, 2022, respectively. The applicable tax rates reflect the taxable jurisdictions and nature, being on account of capital or income, of the significant items.

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