CANADIAN NATIONAL RAILWAY COMPANY The credit ratings assigned to these newly issued debt instrument are based on the credit rating of an already-outstanding debt series of the above-mentioned debt instrument.
CN intends to use the net proceeds from the Notes for general corporate purposes, which may include the redemption and refinancing of outstanding indebtedness, share repurchases, acquisitions, and other business opportunities. The Notes will rank equally with all of CN's existing and future senior unsecured indebtedness.
CN's credit ratings continue to be underpinned by an extensive network, diversified product and customer base, high operating efficiency, strong cash flow-generative profile, and the sector's relative importance to the broader economy. These advantages are balanced by the high capital intensity of the railway industry, the regulatory focus on safety and service, and the railway sector's position as a mature industry with modest long-term growth relative to other cyclical industries.
ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance factors that had a significant or relevant effect on the credit analysis.
A description of how Morningstar DBRS considers ESG factors within the Morningstar DBRS analytical framework can be found in the Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://dbrs.morningstar.com/research/427030 (
BUSINESS RISK ASSESSMENT (BRA) AND FINANCIAL RISK ASSESSMENT (FRA)
(A) Weighting of BRA Factors
In the analysis of CN, the relative weighting of the BRA factors was approximately equal.
(B) Weighting of FRA Factors
In the analysis of CN, the relative weighting of the FRA factors was approximately equal.
(C) Weighting of the BRA and the FRA
In the analysis of CN, the BRA carries greater weight than the FRA.
Notes:
All figures are in Canadian dollars unless otherwise noted.
Morningstar DBRS applied the following principal methodologies:
Global Methodology for Rating Companies in the Railway Industry (
Morningstar DBRS Global Corporate Criteria (
Morningstar DBRS credit ratings may use of one or more sections of the Morningstar DBRS Global Corporate Criteria (
The credit rating methodologies used in the analysis of this transaction can be found at: https://dbrs.morningstar.com/about/methodologies.
A description of how Morningstar DBRS analyzes corporate finance transactions and how the methodologies are collectively applied can be found at: https://dbrs.morningstar.com/research/431153.
The conditions that lead to the assignment of a Negative or Positive trend are generally resolved within a 12-month period. Morningstar DBRS trends and credit ratings are under regular surveillance.
Information regarding Morningstar DBRS credit ratings, including definitions, policies, and methodologies, is available on dbrs.morningstar.com or contact us at info-DBRS@morningstar.com.
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