Canadian National Railway Company (CN) plans to cut capital spending as part of new strategic plan to boost profits, as investor calls for changes to the company .
Canadian National said on Friday it expected to cut capital spending to 17% of revenue in 2022, due to the current health of its network.
The railroad, which will also begin repurchasing its shares, has also set a target of $ 700 million in additional operating revenue and is aiming for an operating ratio – a measure of efficiency that expresses expenses as that percentage of revenue – 57% for next year.
The announcement of the new plan comes after CN’s failure to buy the US Kansas City Southern Railroad. The Montreal rail carrier saw this acquisition slip away in favor of its Canadian rival, the Canadian Pacific Railway (CP).
British investor TCI Fund Management said Monday it intends to call for a special meeting of CN shareholders in an attempt to “freshen up” the railway’s board of directors by adding four members it chose.
The investment fund also proposed the appointment of Jim Vena, former chief operating officer at CN, as a potential replacement for the current chief executive, Jean-Jacques Ruest.