My name is David McLean, and I am CN's Chairman of the Board, and it's a great pleasure to welcome our shareholders, our employees, and our guests in Vancouver, British Columbia, which happens to be my hometown, to our nineteenth annual meeting of shareholders. It's been our custom to hold our annual general meetings in cities across North America, and this is no exception. CN has had a major presence in the greater Vancouver area for almost a century. Through one of its predecessor companies, the Canadian Northern Railway. Today, CN's Thornton Yard and Vancouver Intermodal Terminal are major hubs of operations, and we employ more than 700 railroaders in the Vancouver area and more than 2,300 railroaders in the province of British Columbia.
In Vancouver, we serve an array of waterfront terminals, handling containers, bulk commodities such as coal, grain, and fertilizers, as well as breakbulk cargo, including pulp, wood pellets, lumber, and imported vehicles. We have developed an innovative supply chain collaboration agreements with our port and terminal partners as we strive to become a true supply chain enabler. Significance of Vancouver to CN is evidenced by the fact that our Edmonton to Vancouver mainline has the highest freight traffic density of any corridor in the company's North American system. We've invested substantially in our network to accommodate this traffic, which is essential to the economy of British Columbia and to Canada, and to make our customers more competitive in their end markets at home and abroad. Today, approximately one-quarter of CN's revenues are earned by moving goods that arrive and depart via Vancouver and Prince Rupert gateways.
I'm now pleased to call to order the annual meeting of shareholders of Canadian National Railway Company. Before we begin with the business of the meeting, I would ask Sean Finn, our Executive Vice President, Corporate Services and Chief Legal Officer, to give a safety briefing for this meeting. Sean?
Chairman, thank you. Good morning. Every work assignment at CN begins with a safety briefing. Please allow me to take a few moments to review the safety procedures of the Westin Bayshore Hotel. The room is equipped with an audible fire alarm. The alarm consists of a slow sounding signal, followed by a second stage alarm, which is a consistent bell alerting the entire complex. If an evacuation order is given, hotel employees will direct you outside. I'd ask you to leave by the doors to your left, down the corridor to outside. If not, the doors behind you where you came in, also towards the lobby and outside the hotel. The room is also equipped with fire extinguishers and sprinklers. In the event of a medical emergency, my colleague, Andrew Soprano, is qualified as first aid, and Bart McMillan will be calling nine one one.
Andrew and Bart, would you please stand up and be identified? Andrew, thank you. Bart. Thank you, Bart.[Foreign language]
As Sean mentioned, every work assignment at CN begins with a safety briefing, and nothing is more important to us than creating a safe place to work. The safety of the men and women who work for CN is of paramount importance to us as a company. We devote significant effort and resources to ensuring a safe environment and culture that minimize work-related risks. The goal is, of course, to eliminate work-related risks altogether. Through technology, employee education, and promoting a safety mindset throughout the company, we work diligently to improve our results each year. CN's significant and ongoing investments in its training programs and its new state-of-the-art training facilities are designed to strengthen CN's safety culture and prepare a new generation of safety-conscious railroaders.
In spite of our very best efforts, however, it saddens me to report that two of our employees have died in the service of the company since our last annual meeting. Would you please rise and join me in a moment of silence for Jason Conway on November 18th, 2013, and Jared Ward on March 16th, 2014. These tragedies remind us all that railroading can be an unforgiving industry, and how important safety is. Thank you. I urge everyone to be highly vigilant about personal safety and protecting our colleagues as we perform our duties. This is the best way we can honor the memory of these two men. I would ask for...
I'm sorry, I just before we proceed with the balance of the meeting, I want to take a brief moment to note that this is the last annual meeting of CN shareholders that I will preside over, as I am retiring as Chairman of the company. I first served on the CN board in 1979 for eight years while it was a Crown corporation. I was appointed to the board again in 1994, just prior to its privatization in 1995, and I have served as Chairman for the past 19 consecutive years. In my time at CN, I witnessed CN's transition from a struggling Crown corporation to the most efficient, well-managed railway in North America. It has been a huge transformational journey and one I am extremely proud to have played a major role in.
As I retire, however, I know the company is in good hands and that the board and management will take CN to the next level of excellence. I would now like to introduce the senior officers of CN, who are present on the stage with me today. To my far right is Luc Jobin, Executive Vice President, Chief Financial Officer of the company. Next to Mr. Jobin is Claude Mongeau, President and Chief Executive Officer of the company. And next to Mr. Mongeau is Sean Finn, Executive Vice President, Corporate Services, Chief Legal Officer, and Corporate Secretary. I will act as the chairman of the meeting, and Mr. Finn will act as secretary of the meeting. During the meeting, I will entertain questions relating to a specific motion after that motion has been moved, seconded, but before the vote on the motion takes place.
If you have questions or motions, please use the two floor microphones when addressing the meeting. There are two microphones, microphone one, microphone two. Use one or the other. Also, identify yourself and state whether you are a shareholder or a proxy holder. There will also be two short presentations. Claude Mongeau will give the President's address, and Luc Jobin will outline the highlights of the 2013 financial performance. After Luc's remarks, we will welcome your general questions. On behalf of the board and the company, we'd like to thank the shareholders who submitted their proxies in advance of the meeting. Of course, only registered shareholders or proxy holders are entitled to take an active part in or vote at this meeting today.
To move the meeting along, a number of shareholders have agreed to move and second formal motions, and I will call on them at the appropriate time. We will conduct a ballot on the election of directors and the non-binding advisory resolution on the company's approach to executive compensation. I will explain the procedure to be followed at the appropriate time. Regarding the nomination of auditors, we will proceed on this by a show of hands. The corporate secretary of the company has advised me that the notice calling this meeting and the accompanying information circular, form of proxy, and annual report, were mailed starting on March 24, 2014, to holders of common shares at the close of business on March 6, 2014, which is the record date.
A copy of the confirmation of mailing of such documents has been filed with me for inclusion in the minutes of this meeting. With your agreement, I will appoint Mark Thompson and Muriel Mallette of Computershare Trust Company of Canada, the transfer agent for CN's common shares, to act as scrutineers of the meeting. I don't see anybody protesting, so I assume that's agreed. I have been advised by the scrutineers that on the basis of the proxies received prior to the meeting and the shareholders and proxy holders attending this meeting, there is a quorum present. I therefore declare that the meeting has been regularly called and is properly constituted for the transaction of business. The next item of business is the submission of the financial statements of the company.
The annual report of the company, which contains the comparative consolidated financial statements of the company and its subsidiaries at December 31, 2013, together with the reports of the auditors and the company's management, discussion, and analysis, has been mailed to shareholders of the company who have requested it. Copies were made available to you this morning in the adjacent room. There's no formal action to be taken today with regards to this item on the agenda. However, as I previously mentioned, Luc Jobin, our Executive Vice President and Chief Financial Officer, will be delivering a report on the financial statements later this morning. We will now proceed with the election of directors. According to a resolution of the board, 13 directors are to be elected. Information regarding the nominees proposed by management is set out in the management information circular sent to shareholders.
I'd like to take this opportunity to thank two of our long-standing directors who will be retiring after this meeting, Michael Armellino and Hugh Bolton, for their tremendous hard work and dedication to the service of CN. I would also like to take the opportunity to introduce three new nominees for consideration of the CN board. I'll nominate them first and, or I'll just introduce them, and then I think we'll have a formal nomination. The three new nominees are the Honorable Kevin Lynch, Robert Phillips, and Laura Stein. I would now ask Sean Finn, Corporate Secretary of the company, to read the names of those nominated for election as directors in the management information circular.
Mr. Chairman, the following individuals are nominated for election as directors of Canadian National Railway Company: Charles Baillie, Donald Carty, Ambassador Gordon Giffin, Edith Holiday, Maureen Kempston Darkes, the Honorable Denis Losier, the Honorable Edward Lumley, the Honorable Kevin Lynch, Claude Mongeau, James O'Connor, Robert Pace, Robert Phillips, and Laura Stein.
I'll ask Paul Butcher to nominate the directors.
Mr. Chairman, my name is Paul Butcher. I am a shareholder of the company, and I'm pleased to nominate each of the persons named by the secretary of the meeting to be elected as a director, to hold office until the next annual meeting of shareholders, or until his or her successor is duly elected or appointed.
Thank you, Paul. Derek Giacomazzi, will you second the nominations?
Mr. Chairman, my name is Derek Giacomazzi. I'm a shareholder of the company, and I second the nominations.
Thank you, Derek. As there are no further nominations, I declare the nominations closed. Pursuant to a resolution adopted by the board of directors, 13 directors are to be elected, and 13 eligible candidates have been nominated. I now direct that a ballot be taken on the motion to elect the directors. The names of the 13 management nominees for election of directors are set out on the ballot. You should mark the ballot opposite the names of each of the persons for whom you wish to vote and complete the form. Please sign and print your name in the places indicated at the bottom of the ballot, and indicate the total number of shares that you are entitled to vote as a registered shareholder and/or proxy holder. The board of directors recommends voting for the election of each nominee. Many shareholders present have already filed their proxies.
These shareholders should not complete the ballot since their shares will be voted in accordance with the instructions contained in the proxies granted to their proxy holders. Registered shareholders who have not sent in their proxies and proxy holders who are present have received a ballot at the registration desk. It is included in the agenda package handed to you. If you are entitled to vote today but have not received a ballot, please raise your hand so that the scrutineers may provide you with the ballot form. Please hold on to the ballot forms. We will collect them after the ballot on the advisory vote on executive compensation. We'll just pause for a moment to see if there's any of the ballots to be collected. If any ballots to be collected, please signal so that the scrutineers can pick them up.
I think most of them have probably been voted in advance by proxy. I see nobody's hand up, so I'm going to proceed with the appointment of auditors. I would now like to call upon Denis Losier, Chairman of the Audit Committee of the Board, to present the motion to appoint the auditors of the company.
My name is Denis Losier, and I am a shareholder of the company. I move that KPMG LLP be appointed auditors of the company to hold office for the fiscal year 2014, or until the close of the next annual meeting of shareholders, and that the directors be authorized to fix their fees.
Merci, Denis. Richard Cummine, would you please second the motion?
Mr. Chairman, my name is Richard Cummine. I'm a shareholder of the company, and I second the motion.
Thank you, Richard. All those in favor of the motion, please so signify by raising your hand or your red ballot. All those opposed? Seeing none, I declare that KPMG has been appointed as the auditors of the company to hold office for the fiscal year 2014, or until the close of business at the next annual meeting of shareholders. The next item on the agenda is the consideration of the non-binding advisory resolution on the company's approach to executive compensation. The statement of the executive compensation section of the company's information circular, sent to shareholders, discloses in such detail the approach. The results of the vote will not be binding on the board. However, the board will take into account the results of the vote, together with other pertinent information or comments from shareholders in considering the company's approach to executive compensation.
I'll now ask Jody Evely to present the motion.
Mr. Chairman, my name is Jody Evely. I'm a shareholder of the company. I move that the non-binding advisory resolution on the company's approach to executive compensation, as set out on page six of the Management Information Circular, be approved.
Thank you, Jody. Dan Bresolin, will you second the motion?
Mr. Chairman, my name is Dan Bresolin. I am a shareholder of the company, and I second that motion.
Thank you, Dan. I direct that a ballot be taken on the motion to adopt the non-binding advisory resolution on the company's approach to executive compensation. Again, you should sign and print your name on the places indicated at the bottom of the ballot. Please indicate the total number of shares you're entitled to vote as a registered shareholder and/or proxy holder. You're asked to either vote for or against the motion. The board of directors is recommending you vote for. When your ballot form is completed, hand it together with the ballot on the election of directors to the nearest attendant. Anybody have any ballots that you need collected, just signify and they'll pick them up. Any more ballots that need to be collected? Okay, while the scrutineers are tabulating the ballots, we'll continue with the meeting.
We do not have any other business to bring before the meeting, so we now move to the next item, our CEO's presentation. 2013 was a record year for CN on many fronts. Thanks to the company's agenda of operational and service excellence, our focus on supply chain collaboration and solid execution, CN's 2013 growth continued to outpace that of all the overall economies, generating the highest volumes of earnings in the company's history. Claude Mongeau made significant contributions to our success, helping the team drive major gains in service, safety, and asset utilization, and achieve superior growth through share gains across a range of markets, and open new markets with breakthrough opportunities, and build stronger ties with our employees and key stakeholders.
Claude, I call upon you now to address our shareholders about our substantial 2013 successes, and to talk about the next steps in CN's remarkable transformational journey.
Thank you, David. This is our 20th annual general meeting, and as a publicly traded company. It's a short history, but it's been a remarkable business transformation throughout. David, you were there all along, and on behalf of management and the board of directors, again, I want to pay tribute to your contribution and leadership to this company over so many years. Thank you. It has been indeed a remarkable business transformation. 20 years ago, we were a Crown corporation. We were a rather Canadian-centric railroad. We had, you know, a good infrastructure and a beautiful network serving Canada from coast to coast, but we lacked a sense of urgency. We lacked a sense of accountability. Again, as I said, we were mostly a Canadian railroad. 20 short years later, we are a fully investor-driven company.
We have expanded our reach deep into the U.S. We are now no longer just coast to coast. We are coast to coast to coast, all the way down to the Gulf of Mexico. We've expanded our reach and expanded our service offerings, our efficiency, such that today, I am proud to say, we are leading the industry. We went, in railroad terms, from the caboose position to the leading position in 20 short years. Along the way, we redefined many cons, many aspects. We basically redefined the business model for what a good railroad is all about. We are the most efficient, and that's important because the railroading is a very asset-intensive business.
If you cannot, if you cannot be asset efficient, the cost of providing the services are such that you cannot bring value to the customers, and you need to bring value to the customer in a way that allows sufficient profitability to be able to reinvest in the business. We were not able to reinvest when we were a Crown corporation. Today, we're profitable. We have the lowest rate, the Canadian industry as a whole, not just CN, have the lowest rate, rate for freight in the OECD countries. We have one of the best service offerings. It's not perfect. Railroads are highly efficient, but it's an inflexible technology. It's not an easy technology, particularly when you face adversity, like what happens in the wintertime. But we have, objectively, the best service in the industry, most efficient, best service. That is a good combination. We are leading the way.
Other railroads are emulating our practices, and this is a good thing. It's a good thing for Canada. It's a good thing for North America, because a good railroad infrastructure is essential to economic growth. We view our role as being a true backbone to the economy. CN touches, every year, $250 billion worth of goods. Without CN operating efficiently, this country comes to a grinding halt. It's that simple. So how we do what we have to do is very important. We have to get our customers to their end market efficiently. We have to help them win in their end market. In order to get there, a lot of transformation has to take place. We first restructured the company from the top to the bottom, to gain efficiencies, to reduce fixed costs.
We then introduced an entirely new business model, so-called Scheduled or Precision Railroading, based on asset utilization, based on good service. All of that allowed us to take the leading position. But as always, in business, they say, "What have you done for me lately?" So we need to take our game to the next level, and that's what we've been doing. Our agenda today is to become a true supply chain enabler, to help our customers win in their end market, and to play our role in delivering responsibly and being a true backbone to the economy. And we think we do that very well. This will give you the financial results last year, and they will echo my comments in terms of efficiency, service, and everything we have to do to play our role... But it's not enough.
We have to continue to improve, and the way we do this is by balancing efficiency and service excellence. We call it operational and service excellence. It's adding that fourth ball in the juggling act, so that not only can we provide competitive rates, not only can we provide good service, but we can increasingly start to embed ourselves within the supply chain that we work in to the benefit of our customers. This means interacting better with supply chain partners, many of which are based here in Vancouver. All the supply chain partners we deal with at the Port of Vancouver would be part of what we are calling our supply chain, our ecosystem of collaboration. So operational and service excellence, becoming a true supply chain enablers, is our new agenda. It's been the same agenda for four years.
I could have had exactly the same chart last year. What we're doing is deepening it, deepening it in all aspects, and it's working. Our goal is to grow faster than the general rate of the economy. If we provide good service, if we become a true supply chain enabler, then it stands to reason that more and more customers will want to use our services, and that the customers that we already have will be winning in their markets, gaining market share, so that they can benefit, and we can benefit. We are only as good as what our customers produce. So growing faster than the economy, delivering superior profitable growth is our second core underpinning in our strategy, and we got to do this at low incremental cost.
We're not losing sight of the importance of remaining the leader in terms of asset utilization and profitability. And then from there, we have to build, and it's a huge challenge at CN, on the foundation that we have put in place over the last 20 years, but we got to carry the torch. We got to get the workforce renewal that's taking place at CN and bring on a new generation of railroaders. Every year, we bring on about 9% or 10% of our employees are new employees. I've been CEO of CN for 4.5 years, and we're approaching 50% of the workforce that has been changed. If I'm lucky enough to be again here next year or the next couple of years, at some point, the vast majority of the employees will have been changed.
It is the railroaders of CN, 23,000 strong, that make a difference. Not the color of our locomotives, not the gauge of our track. It's not the equipment we buy. It's the people and how they come together that make a difference. And lastly, I said earlier, we aim to deliver responsibly. We have an unwavering commitment to safety. We move a lot of products that are essential to the quality of life of the Canadians and Americans that are in our serving territory. An unwavering commitment to safety is an essential underpinning to our agenda. And we also aim to lead the way in terms of our sustainability agenda.
Delivering responsibly at CN means deepening the partnerships and the connections that we have with all the people that we touch, whether they're customers, stakeholders, or living near the tracks or the facilities that we have. When you go around this wheel and have clear vision, clear sense of accountability, and the ability to execute, good things happen. We've had a tough start to 2014. It was a difficult winter, but our agenda, we are staying true to it. And as Luke will tell you in a minute, we're delivering solid results despite the adversity. It's because we have the right business agenda, and for all of our shareholders, if we have the right business agenda and deliver on it, we will continue to create lasting value. We are today a $50 billion market capitalization company.
We are the fifth largest in Canada, the largest industrial company by market capitalization. We were only $2 billion when we were privatized 20 years ago. It's been a remarkable business transformation. It's been very rewarding for our shareholders, and if we have the right agenda, we have another 20 years in front of us of significant value creation. We just got to stay with it. Thank you.
Thank you, Claude. CN's agenda of operational and service excellence delivered record volumes and revenues in 2013. Key operating and service metrics contained solid and continued to drive incremental improvement in our broad safety records. Am I doing your speech? No. No. Okay. Revenues increased by 7%, adjusted diluted earnings per share rose by 9%, and free cash flow topped $1.6 billion. This was a remarkable achievement. I now call upon Luc Jobin. I thought I was predicting doing his speech, but I wasn't. I call upon Luc Jobin, CN's Executive Vice President, Chief Financial Officer, to discuss CN's 2013 financial performance.
Thank you very much, David. You were doing fine there. I thought I'd let you carry on. I'd like to thank CN shareholders joining us this morning here in Vancouver and via webcast. It is my pleasure to be here today and to present my report to CN shareholders. So let me get right to it. Claude has just reviewed with you how CN's strategy of supply chain collaboration continues to gain momentum. Through continuous service innovation and our supply chain partnerships, we are increasing our visibility from end to end and helping our customers win in their markets, which in turn allows us to grow faster than the economy. We remain focused on the delicate balance involved in driving operational efficiency while improving service levels. This is the formula that allows us to accommodate revenue growth at low incremental cost.
The end goal is a railroad that helps connect our partners across the supply chain, delivering value to our customers on a profitable basis. The company's record financial results achieved in the past year substantiate the benefits of becoming a true supply chain enabler. In 2013, CN achieved the highest annual volumes, revenues, and earnings in the company's history. On a reported basis, earnings per share grew to $3.09. Excluding items that affect the comparability of the financial results in both 2012 and 2013, CN's 2013 adjusted earnings per share grew a solid 9%. Allow me now to walk you through the key drivers that underpin this performance. The company handled record volumes in 2013, with nearly 5.2 million car loads, up 3% versus 2012.
The volume increase was driven by growth in North American and Asian economies, as well as by the company's ability to leverage its supply chain approach. This enabled us to outperform base market conditions in a number of commodity segments. Significant volume growth was realized in the petroleum and chemical sector, combined with strong demand for energy-related commodities, and the intermodal sector continued to benefit from share gains in domestic and international markets. The company also benefited from inflation plus pricing gains. Overall, revenues increased 7% to over $10.5 billion, achieving the highest level in the company's history. At the same time, CN continued its disciplined approach to managing expenses. 2013 operating expenses increased by 7%. The increase was mainly due to the impact of solid volume growth, inflation, and a significant pension headwind.
In 2013, the company achieved an industry-leading operating ratio of 63.4%. Looking ahead, we see the operating ratio in the low 60s, in line with our objective of growing the top line while managing our costs as wisely as ever. Overall, CN continued to improve its operating performance in 2013. Our train and yard productivity increased, and we once again achieved exceptional car velocity. But we're also balancing operating productivity with service excellence. We're committed to our strategy of becoming a true supply chain enabler, delivering better end-to-end service to our customers through increased visibility, communication, and collaboration. As Claude said, in all, we carry over $250 billion worth of goods on our network each year, making us an important part of our customers' supply chain and a true backbone to the North American economy.
That is why our team works hard, very hard, to maintain our operating metrics, our core operating metrics, and strive to achieve the level of service we know our customers value. When you're successful in growing revenues at low incremental costs, you create the capacity to generate cash. In 2013, CN generated just over $1.6 billion in free cash flow. Excluding the benefit of asset sales, this is a 16% improvement over 2012. These free cash flow figures are after pension contributions and capital expenditures. On the pension front, we made a voluntary pension contribution of $100 million in 2013. And so, over the last four years, we've made just shy of $1.5 billion in special contributions to strengthen the financial position of the company's pension plan.
Combined with solid investment returns on pension assets and a favorable change in discount rates, this has returned the pension position on our balance sheet to a surplus position. Turning now to our track record of capital reinvestment. CN invested just over $2 billion on capital programs in 2013. This represents over 50% of our operating income. Over the last five years, the company has reinvested in the business close to $9 billion. Of this, nearly $5 billion is for core track infrastructure, including the replacement of rail, ties, bridges, and other improvements, which enable us to operate a safe railway and maintain integrity and fluidity in the network. With regards to growth and productivity, we've invested over $1.4 billion. These investments were done to increase our network capacity, helping us grow the franchise and improve resiliency.
This includes investments in double track, in long sidings, in yard enhancements, and improved connections on the EJ&E. We have supported the growth strategy with sizable investments as well in logistics parks, terminals, and facilities, as well, as well as branch line upgrades. In the last five years, we've invested close to $1.3 billion in rolling stock, which includes cars and locomotives. Our locomotive renewal plan is providing motive, the motive power to meet our growing volumes. That's why we've allocated over $1 billion in securing more than 450 locomotives and enhancing the quality of our existing fleet. We also continue to invest in information technology, in training, and other support infrastructure. In information technology alone, it represented $600 million of investment over the last five years.
This was done because it provides the timely information required to make informed decisions, and that is key to supporting productivity, enabling a supply chain approach, and driving our first mile, last mile customer service initiatives. Our strong cash flow performance and our disciplined approach to capital helps us maintain a solid balance sheet. Prudent financial management, that's another key piece of the CN foundation. Our investment-grade credit rating allows us to have continuous access to low-cost source of funds. Let me now address shareholder returns. Rewarding shareholders for the confidence they entrust in us is a priority. With a strong balance sheet and solid economic prospects, the company bought back $1.4 billion worth of stock, and that's close to 27 million common shares in 2013.
We've had a significant buyback program in place over the last 5 years, amounting to over $5 billion and pausing only in 2009 during the worst part of the recession. Our current program, which runs until October of 2014, provides for the repurchase of up to 30 million shares. Dividend growth has also been a priority. The dividend has grown every year since the company was privatized. That's 18 years of uninterrupted dividend growth. During this time, CN has grown dividends at an average rate of 16% per year. For 2014, once again, the company's board of directors kept up the pace and approved a 16% dividend increase. When you combine dividends and share buybacks, the value returned to shareholders is over $8 billion in the last 5 years. This clearly demonstrates our commitment to rewarding shareholders.
In addition, the shareholder value creation has translated into a significant stock price appreciation. Over the last 5 years, adjusting for the stock split, our Canadian stock price increased over 70%. When you add in the reinvestment of dividends, the cumulative total return is 192%. By comparison, over the same period, the TSX increased by 76% and the S&P 500 increased by 128%. Now, as Claude has highlighted, our supply chain approach is helping us to improve customer service and productivity. We have a solid strategic agenda. It's gaining momentum. It's delivering value to our customers, and that is what is keeping CN an industry leader. Now, yesterday, the company reported its first quarter 2014 earnings. On a reported basis, diluted earnings per share grew 15% to $0.75 per share.
Excluding gains from major property disposals in both 2013 and 2014, an adjusted diluted EPS of $0.66, an increase of 8% over the same period last year. In the first quarter, we were challenged by extremely harsh winter weather conditions, which hampered operations across the network and impacted our ability to fully meet customer demand. Spring, fortunately, has finally arrived, and the network is returning to pre-winter levels of operating and service performance. Our supply chain approach helped us manage through these challenges, and we see good momentum as we look out to the balance of 2014. With this, allow me to review with you our outlook for 2014. We are assuming a continued progression in the North American economy, combined with opportunities in grain, lumber, intermodal, and energy-related commodities.
Despite the challenging first quarter, we have reaffirmed our guidance, which calls for double-digit earnings growth in 2014 over our 2013 adjusted diluted EPS of $3.06. We continue to target free cash flow in the range of $1.6 billion-$1.7 billion. To further strengthen network resilience and also given our expectation of continued strong volume growth, we are increasing our 2014 capital investments by $150 million- $2.25 billion. So as we look ahead to the balance of 2014 and beyond, we have a solid foundation in place.
We faced adverse conditions in the last few months, but our strategy of supply chain collaboration continues to gain momentum, and the CN team remains focused on delivering superior results as our strategic agenda unfolds. David, shareholders, the CN leadership team remains committed to ensuring that this franchise is well-positioned for the future. Thank you very much.
Thank you, Luc. I have now received the report of the scrutineers on the election of directors, and I got to tell you, it was a cliffhanger. According to the proxies received and the ballots cast, each director nominee received at least 97% of the shares voted in favor of his or her election. I therefore declare that the 13 nominees set out in the management information circular have been duly elected as directors of the company to hold office until the next annual meeting of shareholders or until their successors are duly elected or appointed. I also declare that the non-binding advisory say-on-pay resolution on the company's approach to executive comp, compensation has been approved by a majority of the holders of shares represented in person or by proxy at this meeting. I would now like to present the members of your 2014/2015 board of directors.
They're a very talented group from all over North America, who make every effort to bring value to the shareholders of this company. I will ask each of them who are seated before the stage to rise, face the audience, and remain standing until all of them have been introduced. I would ask you to withhold your applause until they've all been introduced. From Toronto, Ontario, a former chairman and CEO of the Toronto-Dominion Bank, the chair of the Alberta Investment Management Corporation, and a director of George Weston Limited, TELUS Corporation, Charles Baillie. From Dallas, Texas, a former vice chairman and chief financial officer of Dell Inc., and the retired chairman and CEO of AMR Corporation and American Airlines, currently serves as the director of Talisman Energy. He's also chairman of Virgin America Airlines, Porter Airlines, and Research Now Group, Donald Carty.
From Atlanta, Georgia, a senior partner in the law firm of McKenna Long & Aldridge, chairman of the board of TransAlta Corporation, and a director of the Canadian Imperial Bank of Commerce, Canadian Natural Resources Limited, Just Energy Group Inc., Element Financial Corporation, and former United States Ambassador to Canada, Ambassador Gordon Giffin. From Palm Beach County, Florida, a lawyer and former general counsel, United States Treasury Department, and secretary of the Cabinet of the White House under President George H.W. Bush. She is also a director of the Hess Corporation, RTI International Metals, White Mountains Insurance Group, and the Franklin Templeton Group of Funds, Edith Holiday.
From Fort Lauderdale-by-the-Sea, Florida, the retired group vice president and president, Latin America, Africa, and the Middle East of General Motors Company, and a director of Balfour Beatty PLC, Enbridge Inc., Brookfield Asset Management Inc., and Irving Oil Company Limited, Maureen Kempston Darkes. From Cap-Pelé, New Brunswick, the retired president and CEO of Assumption Life and director of Enbridge Gas New Brunswick, and of Plazacorp Retail Properties Ltd., and chair of the board of Invest New Brunswick. He's a member of the Security Intelligence Review Committee, and as such, is a member of the Privy Council of Canada and the former Minister of Fisheries, Aquaculture, and Minister of Economic Development and Tourism in the province of New Brunswick, The Honorable Denis Losier.
From South Lancaster, Ontario, the vice chairman of BMO Capital Markets, a director of BCE Inc., Bell Canada Enterprises, and a member of the advisory board of Mercedes-Benz Canada, the chancellor of the University of Windsor, and a former federal minister of Industry, International Trade and Regional Economic Development, Communications, and Science and Technology, The Honorable Edward Lumley. From Ottawa, Ontario, vice chair of BMO Financial Group, a director of Empire Company Limited, CNOOC Limited, and the chair of the Board of Governors of the University of Waterloo, the Chancellor of King's University, a director of the Asia Pacific Foundation, the Gairdner Foundation, the Ditchley Foundation, and Perimeter Institute, former Deputy Minister of Industry, and a former Deputy Minister of Finance, and the former Executive Director of the International Monetary Fund.
He's a member of the Queen's Privy Council for Canada and an Officer of the Order of Canada, The Honorable Kevin Lynch. From Fort Lauderdale, Florida, the former chair and chief executive officer of Republic Services, Inc., director of Clean Energy Fuels Corp., who was named on the list of America's Best CEOs each year from 2005 to 2010, and in 2011 on the Institutional Investors All-American Executive Team, James O'Connor. From West Vancouver, British Columbia, the president of R.L. Phillips Investments Inc., and the director of Canadian Western Bank, MacDonald, Dettwiler and Associates Limited, West Fraser Timber Company Limited, and Precision Drilling Corporation. He's also a director of EPCOR Utilities and Axia NetMedia, but he will not be standing for re-election in 2014 on the boards of those two companies.
His past directorships include, among others, Capital Power, Tree Island Wire Income Fund, Boston Pizza Royalties Income Fund, Robert Phillips. From Lafayette, California, the senior vice president, general counsel of The Clorox Company, and the director of Franklin Resources, and a former director of Nash Finch Company. She also serves on the boards of several not-for-profit corporations, including Corporate Pro Bono, Equal Justice Works, the Leadership Council on Legal Diversity, and the Association of General Counsel. She was Chair of the Association of Corporate Counsel, Co-Chair of General Counsel of the Committee of the American Bar Association Business Law Section, and the Director of the Pittsburgh Ballet Theatre, Laura Stein. From Montreal, Quebec, your CEO and President, Claude Mongeau. From Seabright, Nova Scotia, the President and CEO of the Pace Group, the Director of High Liner Foods, Incorporated, and Hydro One.
He's also Chairman of the Walter Gordon Foundation, and the former director of the Asia Pacific Foundation, the Atlantic Salmon Foundation. CN's incoming Chair of the Board of Directors, Robert Pace. Ladies and gentlemen, these are your elected directors. Before I wanna introduce our directors emeritus, but before doing so, I wanna pay special attention to someone who's with us today, who was president and CEO of CN from 1992- 2002. Paul Tellier was instrumental in the very successful IPO in 1995, and the acquisition of the Illinois Central Railroad, which really transformed the history of CN. Ladies and gentlemen, please recognize Paul Tellier. We are fortunate to have with us today a former CN director, who we honor as directors emeritus, in the recognition of their extraordinary service and contributions to the CN board. We have two of them present.
From Calgary, to Jim Gray, and from Toronto, Mr. Cedric Ritchie. Jim and Cedric, would you rise and be recognized? We have two other directors emeritus who couldn't be with us today, Raymond Cyr from Montreal, and Purdy Crawford from Toronto. And, we also have, I should mention, we have two recently honored directors emeritus who couldn't be with us today for very legitimate reasons, Hugh Bolton and Michael Armellino, and I guess I join that group as chairman emeritus. So we have a little bigger crowd than we used to have. As we've completed all of the business of the company, I will entertain a motion to conclude the formal part of this meeting. John Hall, would you kindly introduce a motion to that effect?
Mr. Chairman, my name is John Hall. I am a shareholder of the company, and I move at this time to conclude the formal part of this meeting.
Thank you, John. Mike Peterson, will you second the motion?
Mr. Chairman, my name is Mike Peterson. I'm a shareholder of the company, and I second the motion.
Thank you, Mike. All in favor, raise your hand. Opposed? Motion is carried. I declare it carried, and the meeting is closed. We now have time for a general question period, and we invite any shareholder or proxy holder of the company who has a question to come forward and use the floor microphones. In the interest of time and fairness to everyone who wishes to ask a question, I would ask you to restrict your questions to matters relevant to the business of the company. In order to allow the maximum number of shareholders who wish to ask questions to participate, we ask that you keep your questions short. Anyone who wants to ask more than one question will be asked to hold his or her second question, until anyone else who wants to ask a question has had an opportunity to do so.
Prior to asking your question, please state your name and whether you are a shareholder or a proxy holder of the company. Do you have any questions?
Mr. Chairman, my name is Cristina Circelli. I'm a shareholder of the company. My question is, whether CN provides incentives for employees to own shares? And if so, does employee share ownership contribute to productivity, safety, and retention?
Claude?
Thank you for the question. The answer is yes. We believe that we have the best team of railroaders, and we believe that their interests should be aligned with our shareholders. So we do provide the opportunity for our employees to invest in CN stock, and we match it with a 35% contribution. I think, you know, maybe 80% or closely, so a little bit above 80% of our employees participate in that program, and so they are being rewarded alongside our shareholders for all their hard work.
Any further questions?
Mr. Chairman, my name is Frank Boucher. I'm a shareholder of the company. Mr. Mongeau talks a lot about wanting CN to become a true supply chain enabler. So what, what's involved in this, and how is it with CN customers?
That's not a plug question, Franco, is it? Then, you know, it's a concept that's very important. We have a customer-centric agenda. We believe in the end that we are only as successful as our customers. We cannot produce anything. We move what they produce. So as we help our customers win in their end markets, that's how we grow faster, and that's how we benefit our own shareholders. But how do you do that? If you have the most efficient service, if you have the you know, a solid foundation in terms of the profitability to help you reinvest in the business, where do you go? Well, where you go is in playing your role broader than just being a great railroad, linking the other supply chain partners that are involved in moving our customers' goods.
That concept of being in the middle of it all, helping other supply chain participants align themselves with our service, providing end-to-end visibility, selling our services in a more direct, more streamlined way, in the end, to create value for our customers, we believe that's the agenda that will propel us forward. It's working, and we're gaining momentum. Despite tough winter, despite setbacks, we remain true to that business agenda.
Any more questions?
Good morning. My name is Vicki Dutton. I'm a farmer, and I'm involved in the export of grain from Western Canada, and I also represent 18,000 Saskatchewan Pulse G rowers. I want to thank you very much for moving the grain as of recent. We have indeed noticed better service, and we really appreciate it. We certainly hope you recognize that Saskatchewan has a growth model that plans to increase the production of grain from Western Canada, not just our province. So indeed, we will need this service to be continued and to understand the variances within our industry. However, my history in this is somewhat longer than yours, close, being a little older than you. I have been involved in so many railroad debates, the Crow Rate, Estey Reports, Lang, Pepin, and we all have this long history.
So I'm finding that as I grow older, my patience is less, and I am so pleased to see the growth model here. So my question is: what is the timeline? Am I going to be facing the same question five years from now, two years from now, 10 years from now? Because I can tell you that growth and investment in growth, I believe we have less pioneers today than we did when my father moved from America to Canada to have growth. We have less investors today, and if we fail to provide them with the growth opportunity, we limit their future, we limit the vision of their children's future. So I do not believe we have forever for the dream to happen. So I guess I would like to know, what is the plan and what is the timeline of this plan? Thank you.
Thank you for the question. We are a true supply chain enabler for grain as much as we are for intermodal or other commodities. It has been more difficult in grain to build mutual trust. There's a lot of history. It's a more complex supply chain, and because there's a lack of mutual trust and there's more volatility in grain, we unfortunately very quickly move from supply chain collaboration to finger-pointing. Finger-pointing does not move grain. What we are facing this year is an unprecedented crop. It's a good story because we have never produced or grown more grain than last crop. But the amount of grain we are faced to move as a supply chain is, in rail terms, about 50% larger than an average crop.
That's 20 million tons more grain that has to be moved as a result of that record crop. We just did not have a record crop, we shattered previous records. Twenty million tons, if you take it for CN, is 10 million more tons. That's twice as much as all the potash that we move. It's 2 million more tons than all the lumber that we move at CN. It's a remarkable crop, and it's not easy to spring resources and flex the supply chain as fast as perhaps farmers would like to see it, and it's not a simple answer. We believe that throughout the fall period, the CN and the rail industry in general, flexed its movement of hopper cars in line with the capability of the grain elevators.
In the fall, we were moving more grain per week than we ever did in our history, in excess of 5,000 cars. We believe we were moving grain in sync with the rest of the industry, the grain elevators. Then came a very difficult winter. All the commodities we move were impacted: coal, lumber, potash, intermodal, every one of the commodities. We haven't seen the extent of finger-pointing that we've seen in grain in those other commodities, because the model of supply chain collaboration is more embedded. In grain, unfortunately, we're not there. There's been an awful lot of shifting blame, of blaming of the railroad, of singling out the railroad. We, for sure, were not moving as much as the grain elevators during the winter. It was not possible. Physically, not possible.
Now that the winter is over, we're right back to where we were in the fall. The last three and a half weeks in April, we moved 5,200 cars on average. We are on top of the supply chain. The grain elevators could not unload more cars if we had more cars. We will make a record movement of grain this year. We already passed that mark year-to-date. We have never moved more grain in our history, and we will set a new record this year. That's what we're doing. As crops continue to improve, as growth gets established, as the trend line becomes clear, we will invest in line with the other supply chain participants. But the system, the policy framework, if it's gonna support investment, must be anchored on collaboration and commercial incentives.
I regret to say it, I believe we took a huge step forward. I believe this government, in the heat of the moment, because of the vocal discontent of farmers, which is understandable, has made us go backward. It's bad policy. It's encouraging finger-pointing. It will not help move more grain. But we shall live over that, too. Hopefully, cooler minds will prevail over time, and we will all understand that normal commercial incentives and supply chain collaboration is the best recipe to move more grain and help grain growers in Canada prosper.
Thank you, Claude. Any further questions? I don't see any. Oh, you, we have one other one.
Trevor Heaver, shareholder. So, could you comment more directly on the implications for operations and your relationships with all shippers, not just the grain shippers, of Bill C-21?
As I said, I believe it's a huge step backward because it undermines collaboration. I also believe that it creates a super priority favoring grain that is unfortunately going to create inefficiencies and make it more difficult for us to do our job of managing priorities. Then, hopefully, other commodity sectors will realize that and will, you know, engage in the debate and bring our policymakers to the point where we consider all those aspects. That's my, that's my hope and, and that's my strong belief, that's what's best for Canada.
Since you've had a question, let me have this gentleman first, and then you can have your question after.
Mr. Chairman, I'm Greg Hamilton. I am a shareholder of the company. How will CN's two new training facilities, the one in Winnipeg and the one in Homewood, how will they better prepare the next generation of railroaders at CN?
Mm-hmm. They already are. The one in Winnipeg has been open for, I think, 2 weeks now. It's a state-of-the-art facility. I said in my remarks that every year, about 10% of our employees are new employees. That's, you know, close to 3,000 employees that have to be trained to learn the trade, to learn safety practices, to understand our business model, to get embedded into our values. There's nothing more important than preparing for the future, and we wanted to have state-of-the-art facilities, but also state-of-the-art curriculum to train those employees. Not just the new ones, the ones that are active and need to get up in their learning curve. We have one now in Canada, in Winnipeg.
It's a beautiful facility, and we have one that will open soon in the fall in Chicago for our U.S. employees.
Okay.
I certainly want to express our appreciation from the grain sector. You know, I don't think anybody in the grain sector wishes it to be a confrontational process, recognizing that it is viewed as such. I believe the best progress can be made by us realizing that industry collaboration and growth is very important. However, you did not give me a timeline to my question.
I think the message that I would bring to you is that, you know, our fragile economy requires growth. The resource sector, many of us are captive of the railroads to exit this country with our exports.
Yeah.
So indeed, I guess perhaps it's not a question, then perhaps it's a recommendation, that the timeline for growth be condensed to recognize that we have increasing industrial production in Saskatchewan and Alberta and Manitoba, that is going to require a significant investment in infrastructure to
Make sure that oil that moves the opposite direction to grain is enabled to generate more growth for shareholders.
Yeah.
But not just shareholders, investors in the economy and Canadian taxpayers in general. Yeah.
No, I thank you for the recommendation. We are a true backbone of the economy, and we believe in helping our customers win, all of our customers, and we actually do make investments in support of our ability to grow with them. That's what we're doing in all commodities. That's also what we're doing in grain. We have the ability to line up in terms of capacity with the grain elevators. And as we do so, and as grain elevators invest in more, capability to unload cars on the waterfront, the railroads will invest. But in order for us to invest, we have to have the proper commercial incentives. It's in that regard that we took a huge step backward. You know, regulation does not help move grain.
Normal commercial incentives, alignment of interests, that will help us prosper and help our grain growers in Canada do so as well.
Thank you, Claude. Seeing no further questions, I'm going to terminate the question period at this stage, and I wanted to depart a bit from the script because I have a few final remarks that this is my last annual general meeting as Chairman of CN's board. I did not stand for re-election of the board today. I want to take a moment to reflect over the past 20 years. CN has had an amazing growth from a market capitalization of $2.3 billion in 1995. Today, it's efficient, profitable, and with a market capitalization in excess of $52 billion. It has been a great pleasure for me to serve as the chairman of the company during this period. I can assure you, CN is a true North American railroad. It's well managed, it's diversified, and it's strong.
Thank you to CN, its management, and the board for all your support to me. I'm very proud to have been part of CN's wonderful success. I now want to make a few comments about the future. CN's chairman is selected by the board of directors. In a few minutes after this meeting, CN will have a board meeting, and assuming I don't upset the apple cart, Robert Pace will be voted in as the new chairman. The board went through a very thorough and careful process in deciding Robert would be my successor. Robert has been on the board since 1994, was part of the IPO. He's a very wise and experienced board member, and I'm very confident he will do a great job as chairman. Robert is from Halifax. He has both a law degree and an MBA.
He's a very successful businessman and the owner of Maritime Broadcasting Company. You can rest assured the company has made a careful choice for Robert Pace to succeed me. Ladies and gentlemen, Robert Pace, will you stand and be recognized? I want to thank everyone for coming and participating in the business of the meeting. Merci et bonne journée. This meeting is now adjourned.