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Canadian National Railway Co. has suspended issuing financial guidance to markets and will continue parking trains and laying off employees amid the COVID-19 pandemic that has closed factories and stores across North America, and killed more than 2,700 Canadians.

CN announced Monday that it has laid off 16 per cent of its work force, reduced its train schedule by 23 per cent, parked 500 locomotives and idled four train yards – steps it began last fall – as freight volumes plunge.

“The COVID-19 pandemic is having an unprecedented and extraordinary impact on the economy,” CN said in a statement accompanying its first quarter-financial results, released after markets closed on Monday. “The economic outlook, and therefore overall demand for transportation services, are highly correlated with the duration of containment measures and the impacts on businesses and consumers, which at this point remain uncertain.”

CN began parking rail cars and laying off employees late last year, as demand for freight services declined. Jean-Jacques Ruest, the railway’s chief executive officer, told analysts on a conference call on Monday that the company has cut 3,800 jobs since then, including temporary layoffs of 2,500 employees.

Rob Reilly, CN’s operating chief, said 700 weekly train starts have been cut and work has been halted at switching yards in Quebec, Kamloops, B.C., Battle Creek, Mich., and Jackson, Miss. “We haven’t quite seen the bottom yet,” Mr. Reilly said. “We’ll continue to right-size as we go along.”

CN posted a first-quarter profit of $1.01-billion, or $1.42 a share, an increase of 31 per cent from the year-earlier quarter. Revenue of $3.5-billion was flat compared with the same period in 2019.

Canada’s largest railway said adjusted profit for the three months ending March 31 was $870-million, or $1.22 a share, and included a $141-million tax credit in the United States related to Washington’s COVID-19 stimulus package.

Ghislain Houle, CN’s chief financial officer, said CN is running various economic scenarios to measure expected freight demand, but cannot predict the depth of the economic crash that has halted auto production and idled much of the world’s economic activity. “The visibility we have is quite limited,” Mr. Houle said. "[That’s] why we suspended our guidance.”

CN was forced to temporarily close much of its network east of Toronto on Feb. 13 during several weeks of rail blockades – some sporadic, some constant – that halted train traffic. Protesters were demonstrating in support of Wet’suwet’en hereditary chiefs’ opposition to a gas pipeline project through their traditional territory in northern British Columbia.

Year-to-date, CN’s revenue ton miles have fallen by 4.4 per cent and carloads are down by 9 per cent, in line with the North American industry’s slump.

In the first quarter, CN posted declines across a range of freight, including forest products, chemicals and coal. Grain and crude oil shipments rose. CN employs 24,000 people and has a 32,000-kilometre rail network that touches three coasts in Canada and the United States.

Christian Wetherbee, a stock analyst at Citigroup Inc., said CN’s profit beat his and the Street’s expectations, as revenue rose more than expected while operating expenses were lower.

CN’s share price on the Toronto Stock Exchange has recovered some of the losses it suffered in March, and sits 3 per cent lower than at the start of 2020.

CN’s smaller domestic rival, Canadian Pacific Railway Ltd., last week slashed its 2020 profit outlook. Keith Creel, CP’s CEO, said freight volumes for the Calgary-based railway will plunge in a “major way” in the second quarter and will not recover until the first quarter of next year.

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