Business acquisition (Tables)

9 Months Ended

Sep. 30, 2023

Business Combination and Asset Acquisition [Abstract]

Schedule of Allocation of Net Assets and Consideration Paid

The following table summarizes the preliminary purchase price allocation with the amounts recognized in respect of the identifiable assets acquired and liabilities and non-controlling interest assumed on the Control Date, as well as the fair value of the previously held equity interest in KCS, and reflects the measurement period adjustments recorded during the third quarter:

(in millions of Canadian dollars)	Reported at June 30, 2023		Measurement period adjustments		Reported at September 30, 2023
Net assets acquired:
Cash and cash equivalents	$	298	$	—	$	298
Net working capital	51		(115)		(64)
Properties	28,748		1		28,749
Intangible assets	3,022		—		3,022
Other long-term assets	496		(1)		495
Long-term debt	(4,545)		—		(4,545)
Deferred income taxes	(6,984)		12		(6,972)
Other long-term liabilities	(406)		3		(403)
Total identifiable net assets	$	20,680	$	(100)	$	20,580
Goodwill	17,491		100		17,591
	$	38,171	$	—	$	38,171
Consideration:
Fair value of previously held equity method investment	$	37,227	$	—	$	37,227
Intercompany net balances acquired	12		—		12
Fair value of non-controlling interest	932		—		932
Total	$	38,171	$	—	$	38,171

Schedule of Pro Forma Information

On a pro forma basis, if the Company had consolidated KCS starting January 1, 2022, the revenue and earnings of the combined entity would be as follows for the three and nine months ended September 30, 2023 and September 30, 2022:

	Three Months Ended September 30, 2023				Three Months Ended September 30, 2022
(in millions of Canadian dollars)	KCS Historical(1)		Pro Forma CPKC		KCS Historical(1)		Pro Forma CPKC
Revenue	$	—	$	3,339	$	1,152	$	3,466
Net income attributable to controlling shareholders	—		780		263		861

(1) KCS's results were translated into Canadian dollars at the Bank of Canada daily exchange rate for the three months ended September 30, 2022 with effective exchange rate of $1.30.

	Nine Months Ended September 30, 2023				Nine Months Ended September 30, 2022
(in millions of Canadian dollars)	KCS Historical(1)		Pro Forma CPKC		KCS Historical(1)		Pro Forma CPKC
Revenue	$	1,351	$	10,133	$	3,216	$	9,578
Net income attributable to controlling shareholders	280		2,151		748		2,879

(1) KCS's results were translated into Canadian dollars at the Bank of Canada daily exchange rate for the period from January 1 to April 13, 2023 and nine months ended September 30, 2022 with effective exchange rates of $1.35 and $1.28, respectively.