CN's New Business Vision Aims to Sharpen Company's Competitive Edge.

Business Editors

TORONTO--(BUSINESS WIRE)--May 25, 2004

E. Hunter Harrison, president and chief executive officer of CN (NYSE:CNI) (TSX:CNR), today unveiled a new corporate vision designed to keep the company at the forefront of rail industry financial performance over the next five years.

Speaking to the company's annual Investors' Conference here this afternoon, Harrison said: "CN is well positioned to deliver improved financial results. We have a strong franchise, the rail industry's best profit margin, and a solid record of growing shareholder value. Indeed, since the company's IPO in 1995, the overall market value of CN has risen almost eight-fold to $15 billion."

Harrison, who last month renewed his employment contract with CN, said: "My commitment to CN over the next five years is to further enhance the railroad's competitive edge. My vision is to make CN not just the best-performing railroad in North America, but the continent's best-performing transportation company. Our goal is to extract even greater benefits from our innovative scheduled railroading practices, and to accelerate our relentless drive to push change and innovation throughout the organization."

Harrison said CN's new vision targets the following ambitious goals:

- To gain market share and improve pricing to achieve $8 billion in annual revenues by 2009;

- To reach an operating ratio of less than 65 per cent, and

- To produce consistent earnings growth, with the objective of increasing earnings per share by 8 to 12 per cent annually over the next five years.

CN's financial outlook is premised on sustained economic growth, oil prices returning to a more normal level of US$30 per barrel, the Canadian dollar trading in the mid-US70 cents range, and other key assumptions.

CN's senior officers at the Investors' Conference will outline today and tomorrow the key elements of the strategies and initiatives designed to allow the company to meet its financial targets. CN is webcasting the presentations, which will include key assumptions and risk factors, via the Investors' section of its web site, www.cn.ca. Please select Analyst Presentations.

This news release contains forward-looking statements. CN cautions that, by their nature, forward-looking statements involve risk and uncertainties and that its results could differ materially from those expressed or implied in such statements. Risks and uncertainties that could affect the results include significant competition, actual and potential environmental liabilities, legal actions, potential adverse consequences of labour negotiations, potential business constraints resulting from regulation, adverse factors affecting fuel price, potential adverse consequences of limited cash, adverse economic conditions, security and impact of severe weather conditions. Reference should be made to CN's most recent Form 40-F filed with the United States Securities and Exchange Commission, and the Annual Information Form filed with the Canadian securities regulators, for a summary of major risks.

Canadian National Railway Company spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key cities of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America.