Good morning. If I can ask everyone to take their seats, the meeting will begin in just a moment. My name is Glenn Wilson, and I'm with Canadian Pacific. At Canadian Pacific, safety is extremely important, and it is my task this morning to inform you of the procedures we will follow should an emergency situation arise during our annual general meeting. In the event of an emergency, the facility has a trained emergency response team on site. They will provide direction and assistance in the event of an emergency. Pick up any house phone in the convention center and dial 333. This is the number that will connect you directly to emergency assistance personnel. In the event of a medical emergency, the facility's security services personnel are the first responders in a coordinated procedure with the city's fire and emergency agencies.
Should it become necessary to evacuate the building for any reason, please follow the instructions that will be broadcast over the public address system. Exits are located immediately outside the meeting room. Please walk toward the exit, and staff will be on hand to help direct you out of the building. If you should require some assistance in exiting, staff will be available to assist you. Thank you for your attention, and welcome to the annual general meeting of shareholders.
Every day at CP, we're driven by the power of asking why. A word that has not only transformed a company but a culture. Three letters that compel our people to ask day in and day out: How can we deliver better customer service? Can we be more mindful of how we spend money? Are we getting the most out of our assets? Can we be safer, and can we do more for our people? Our people are the most important. They're the engines that turn these questions into answers to improve service for our customers and create ongoing value for our shareholders. It starts with everyone sharing the same attitude, an attitude that's passionate about railroading. No matter what our title, we look out our office and know what business we're in.
We understand we're an operating company whose success depends on keeping things moving to help our customers' business grow. I'm being known for providing the most efficient and reliable rail service in North America. That's why we question everything. We sweat the small stuff because railroading excellence demands it. We believe a little detail can translate into a big difference. Our leadership, who came aboard in 2012, put in place a simple roadmap: Do better. Do more. And we've done what we said we would do. The power of asking why has driven continuous rapid improvement across all platforms. We're operating more efficiently with less. We're more agile. We're faster. We're creating more service offerings in areas we're now competitive in, and we're giving back more to communities. More importantly, we've restored a key ingredient in our company and people: pride.
More than a century ago, the visionary railroaders at CP helped build a country, and over the years, we've served as a backbone of North America's growing economy. Today, we're not only a stronger company that is building on our historic legacy. We are creating a future whose first pages are only now just unfolding for our shareholders and customers. It's an introduction to a new iconic CP. We're no longer catching up but setting the pace. Being in front means having the best vantage point for seizing opportunities first, entering new markets, changing the expectations of what it means to be great railroaders, building a stronger, more successful company for the long term. Our stubborn focus on being better will not just make us the best. We will redefine what that word means each year.
That's because every day at CP, we are driven by the power of asking why. Welcome to the new CP.
Good morning, ladies and gentlemen. My name is Paul Haggis, and I'm Chairman of the Board of Directors at Canadian Pacific. It is my pleasure to welcome you to this annual meeting, to the shareholders of CP here in Calgary. I would also like to welcome those listening to the meeting via audio webcast on the internet. With me on the platform today are Hunter Harrison, Chief Executive Officer; Keith Creel, President and Chief Operating Officer; and Paul Guthrie, Chief Legal Officer and secretary to the meeting. I now call the meeting to order. I will act as Chairman of the meeting, and Paul Guthrie will act as secretary. I hereby appoint Mark Thompson and Muriel Malette from Computershare Investor Services to act as scrutineers for the meeting.
The secretary has deposited with me a statutory declaration establishing the sending of notice of the time and place of this meeting to each shareholder entitled to vote, to each director, and to the auditors of Canadian Pacific as required by law. The scrutineers have confirmed that a quorum is present. The scrutineer's final report will be kept with the records of this meeting. I declare that the meeting has been regularly called and properly constituted for the transaction of business. Before we commence the formal part of the meeting, I would like to share with you my few thoughts from this past year. This is the second annual general meeting I have chaired. Last year, I spoke about the significant advancements that CP has made under Hunter's leadership, but I don't think any of us could have imagined the extent of the progress that we've seen.
It's just been nothing short of remarkable. In this past year, we've seen all the positive results of operational improvements and attentive service. We have put foundations into the daily practice across the company. Controlling our costs while optimizing all available assets is now the normal manner in which our business is conducted. Most importantly, though, we have done all this while operating in a safe and responsible manner. It has really been the people, all the men and women of Canadian Pacific, who have embraced Hunter's philosophy and have found new and inventive ways to make it uniquely their own. This has been mirrored in the results we've seen, and CP's success over this past year belongs to each and every member of this company. Our people are the agents of this change, and they are creating a new and dynamic organization.
This excitement has been seen and felt by all of us. The CP board has been an active part of this development, and we are enthusiastically participating in its process. The energy that has been generated within our internal meetings is reflected in what's happening across the entire CP network. We have much to celebrate this past year. By all accounts, 2013 has been an extraordinary one for CP. I think by now everyone has seen the year-end numbers that illustrate what I mean, and I know that Hunter will speak to them in remarks later on. I would point out that this success was achieved during the year filled with some extraordinary severe weather, including June flooding in Alberta. The manner in which CP's team responded and recovered from this extraordinary event was exemplary.
It simply reinforced our admiration and the skill level and the quality of the CP railroaders that are part of our team. It is this quality and faith in our ability that has caused Hunter to reevaluate the timetable on our strategic plan and advance it. Hunter will be here on the podium shortly to speak about this today, but when he told us that CP would be achieving more and moving to lower operating ratio ahead of its initial plan, clearly we're enthusiastic. Hunter knows what this company is capable of and knows that the success we've seen to date is only a curtain riser. There is so much untapped energy and ability within this organization that we can draw on. What an empowering message. It also speaks to the fact that there is more work to be done on all fronts.
This week is Rail Safety Week, which is focused on communication around railway operations and education to communities. Canadian Pacific is a North American presence and is a proud neighbor in more than 1,200 communities. However, things happen, and at this time, I would like to honor the memory of a member of the CP family who was fatally injured in August of last year. Thomas F. Tarcza Jr. was an assistant supervisor operations in the southern region as working just outside of CP's Binghamton Yard in New York. Mr. Tarcza was 39 years old and had been an employee for more than 15 years. It's difficult to accept the loss of a member of our railway family, and I'd ask you to join me in a moment of silence as we remember Thomas Tarcza Jr.
Our desire to keep our people and our communities safe each and every day is the core of our operating philosophy. There is always more that can be done to improve railway safety, and Canadian Pacific is an active participant in this conversation at all levels. Safety is everyone's responsibility, and CP is committed to furthering this dialogue within the industry and carrying that message to the public. The theme of our annual report this year is velocity. This is a physics term which speaks to position, speed, and direction of motion. I can't think of a more appropriate application than to Canadian Pacific. Beyond the association to physical movement of goods and services, velocity speaks to a driving force, a spirit. Some people may talk about speed, but speed only describes how fast something moves.
Velocity is more nuanced and has a much deeper meaning. Velocity talks about direction. It has application to what we're doing here at Canadian Pacific. We're focused on the track ahead. We're specific about what we want, and we know how we're going to get there. It is this specific velocity that has informed our success. Of course, none of what CP has been able to achieve this year would have been possible without the constant attention to service while watching our costs and assets and operating safely. Our people have made all this possible, and it is my belief that this is a reflection of the effective leadership of Canadian Pacific and of the good corporate governance that is necessary for the protection of the interests of investors, employees, and other stakeholders.
Your board is committed to ensuring that our governance principles are of the highest standard and fully compliant with all applicable requirements. The corporate governance principles and guidelines are available to CP on CP's website and in print to any shareholder upon request. Speaking personally now, this meeting concludes my term as chairman. You know there are events that happen to us, these kind of sometimes life-changing events, and for me, one of those events happened late January 2012 when Patricia Olasker of Davies approached me at a dinner and asked if I would take a call from Bill Ackman. After talking to Bill, I was given the opportunity to participate in the greatest cultural turnaround in Canadian corporate history. I said yes in mid-February, and man, am I glad I did, although I have to say some people thought I was nuts.
I was elected to the board of CP on May 17th along with six new directors and nine former directors with an overwhelming mandate from shareholders to begin the work of fundamental change. I had the honor of being elected the inaugural chair of the new CP board in June, and we set to work. But I can tell you those early meetings were not smooth. There was a lot of baggage, and we were literally starting from scratch in how the board was going to function. But improve we did. From that rocky start, you now have a board that has been completely revamped, comprising the very best of the old, the seven nominees for management change, and wonderful new blood in Andy Reardon, Isabelle Courville, and the honorable Jim Prentice.
With the strong and thoughtful guidance of Krystyne Hoeg as chair of the governance committee, CP has taken leadership position for governance in terms of minimum stock ownership, rotation of the board and committee chairs, flat fees taken exclusively in DSUs, one-year deferral for realizing on DSU shares upon retirement, and term limits in favor of rigorous no-term limits, I should say, and no age restrictions in favor of rigorous individual director assessment and evaluation. Thank you, Chris, and your committee for enhancing the governance process and ensuring our alignment with the interests of our fellow shareholders. Under Paul Hilal's leadership as chair of the management resources and compensation committee, along with Rebecca MacDonald and her strong views, CP has completely redesigned compensation practice to entice and retain top talent we have attracted to CP. Thank you, Paul, especially.
The investment in CP by Pershing Square was your idea, so without your vision, we wouldn't be here today. Safety, Operations, and Environment Committee, chaired by Steve Tobias, past Norfolk Southern vice chair and railroader of the year, in other words, a railway god, has provided powerful oversight and advice to operating management through some very difficult operating challenges, as mentioned earlier. He, along with committee members Andy Reardon, another railway god, and Linda Morgan, former chair of the U.S. Surface Transportation Board, surely a railway god if there ever was one, ensures the board has the expertise to ask the right question and keep management focused on what's important. CP has taken a novel approach in splitting the financial functions of the board between finance and audit.
With Tony Melman at the helm of the finance committee, CP has initiated very, very valuable work, the most dramatic being a total turnaround of the pension plan from what was a significant deficit to what we anticipate will be a surplus depending upon liability measurement. But certainly, assets have grown in excess of CAD 1 billion through Tony and the team's insightful and timely reallocation of assets and shrewd appointment of new equity managers. Thank you, Tony, and members of the team. And finally, I'd like to thank Dick Kelly, Chair of the Audit Committee, who retired from the board yesterday. Elected to the board in 2008, Dick's steady hand and powerful leadership ensured continuity and confidence in our financial reporting through a tumultuous period of transition and change. The most important duty of a board is to choose its one employee.
With our choice of Hunter Harrison, we set in motion the greatest railroader since William Cornelius Van Horne. The results of Hunter's drive and leadership speak for itself as we adopt the financial statements and operating results at this meeting for 2013. Thank you, Hunter, making me look good. As I talked with Krystyne Hoeg about transitioning from the chairmanship, she likened my approach to chair as being an air traffic controller, keeping the 13 aircraft in my sector from running into each other, holding formations, and reaching their destination safely. Now, as I stand for reelection as director, I get to leave the tower and actually fly one of the planes with every confidence that our new chairman, who will be elected after this meeting, will enhance the program beyond anything that I have started. So, my fellow shareholders, seatbacks up and fully upright position. Tray tables are secured.
Seat belts are fastened. For though we will inevitably encounter some turbulence along the way, we will continue to enjoy one hell of a ride. I thank you very, very much. Now onto the formal part of the meeting. Please note that after the formal business is concluded and the meeting is terminated, Hunter will present his formal address to shareholders, after which he and Keith will take questions relating to CP's operations. To expedite matters, a number of shareholders or proxy holders have agreed to propose and second motions with respect to the business of this meeting.
While this will help speed the handling of the formal matters, it should not discourage any shareholder or proxy holder from speaking to any motion after it has been proposed and seconded, or from bringing up any questions or comments properly within the scope of this meeting, which pertains to the election, appointment of auditors, the appointment of shareholders, and salary and pay. If you do have any such questions or comments at the proper time, please proceed to one of the aisle microphones, identify yourself, and advise whether you are a shareholder or a proxy holder. Please keep your comments brief and ask only one question at a time. Shareholders who do not wish to address the meeting but would like to submit a question or comment in writing may use the bottom of the agenda, a copy of which has been placed in your chair.
Please hand your written questions or comments to an employee of CP to roam the room or Computershare on leaving the room. Questions will be responded to by management as soon as possible. There are three matters set out in the notice of this meeting to be voted on by shareholders. We will conduct all substantive items of business by way of a single ballot. If you are a registered shareholder or proxy holder and advise that you wish to vote in person at this meeting, you should have received your ballot when you registered for the meeting outside. If you have completed and returned your form of proxy or voting instruction form, it is not necessary for you to vote today. However, if you wish to change your mind, you may do so by voting in person at the meeting by submitting a ballot.
Anyone wishing to vote at the meeting and who does not have a ballot, please raise your hand, and one will be provided to you. Mr. Guthrie.
Thank you, Mr. Chairman. Each shareholder or proxy holder may use the ballot provided to vote on all matters at this meeting. In particular, one, the appointment of auditors by placing a mark beside either for or withhold in respect to the appointment of auditors; two, CP's approach to executive compensation by placing a mark beside either for or against in respect to CP's approach to executive compensation; and three, the election of directors by placing a mark opposite the names of the nominees for whom they wish to vote. The ballot should be clearly signed. If you are a shareholder or proxy holder and the space for your name has not been pre-completed, please print your name on the ballot.
Ballots will be collected later in the meeting after all matters have been voted on. The first item of business is the receipt of the consolidated financial statements as included in the 2013 annual report. A copy of the annual report has been made available to shareholders in either hard copy or electronically. I now place before the meeting the consolidated financial statements and report of the auditors thereon for the year ended December 31st, 2013. The next item of business is the appointment of auditors. Megan Albertson, may I have a motion?
Mr. Chairman, I move that Deloitte LLP be appointed auditors of Canadian Pacific to hold office until the close of the next annual meeting of shareholders.
Mr. Chairman, my name is Chris Burns, and I second the motion.
Thank you, Megan. Chris, is there any discussion?
I declare the polls open for the vote of the appointment of auditors. The next item of business is a non-binding advisory vote on CP's approach to executive compensation, commonly known as say-on-pay. Brianne Fregel, may I have a motion?
Mr. Chairman, I move that on an advisory basis and not to diminish the responsibilities of the board of directors that shareholders accept the approach to executive compensation disclosed in the corporation's information circular delivered in advance of the 2014 annual meeting of shareholders.
Mr. Chairman, my name is Maria Barkovich, and I second the motion.
Thank you, Brianne and Maria. Is there any discussion on this motion?
Yes, sir.
Yeah, hi. I'm Andrew Pollock at Calgary, Alberta. I own two shares of stock. It's tickets to the show. I'm poor.
I'm an off-duty security guard, so I can't own large positions in every company, but I love annual meetings, so I'll buy sometimes small positions in a variety of companies. Now, on Say-on-pay, the thing I'd like to say often I've heard this criticized, not so much that you have Say-on-pay, but that executives get paid too much. It's the one thing I tend to not complain about myself. I'm sure there are all kinds of other things I don't complain about, is pay of executives. I think it's worthwhile for a small retail shareholder occasionally to make the point that talented executives can make billions of dollars of difference to the profitability of your company over time, and the amount that you're paying them is a small fraction of the value that they bring to the company.
I think it's worthwhile for a small retail shareholder to, from time to time, mention that executives are well paid because they bring great value to the company, and the value that they bring far exceeds the pay that they receive. Thank you very much.
Thank you, sir. Any other comments on this motion? I declare the polls open for the vote on the advisory vote on CP's approach to executive compensation. The final item of business is the election of directors. In accordance with the articles of bylaws of Canadian Pacific, the board of directors has determined that 13 directors are to be elected at the meeting. I now declare the meeting open for nominations.
Mr. Chairman, my name is Josh Pender, and I nominate the following 13 Canadian Pacific director nominees: William Ackman, Gary Colter, Isabelle Courville, Paul Haggis, Hunter Harrison, Paul Hilal, Krystyne Hoeg, Rebecca MacDonald, Anthony Melman, Linda Morgan, the Honorable Jim Prentice, Andrew Reardon, and Stephen Tobias.
Thank you, Josh. Are there any further nominations? As there are no further nominations, I now declare the nominations closed. Celeste?
I move that the persons nominated be elected directors of Canadian Pacific, each to hold office until the close of the next annual meeting of shareholders or until such person's successor is elected or appointed.
Mr. Chairman, my name is Peter Stewart. I second the motion.
Thank you. Is there any discussion on the motion? I declare the polls open for the vote on the election of directors.
As the number of nominees equals the number of board positions, I will declare the polls closed momentarily once the scrutineers have collected all the ballots. Would the scrutineers please proceed to collect the ballots?
Thank you. I hereby declare that the polls have now closed with respect to the items of business. The scrutineers have provided a preliminary report based on proxies received prior to the meeting. I call on the secretary to report on the preliminary results of the votes. I note that the company will report the detailed final voting results, including those votes submitted in person by ballot following the meeting once tabulated. Mr. Secretary?
Thank you, Mr. Chairman. Deloitte LLP have been reappointed auditors of Canadian Pacific. The say-on-pay vote received more than 89% of the votes cast. Each of the 13 nominees has been elected as a director of Canadian Pacific. Thank you.
I adopt the preliminary report of the scrutineers and declare these 13 directors director nominees duly elected directors of Canadian Pacific. I direct that the scrutineers' report be annexed to the minutes of this meeting. Ladies and gentlemen, your duly elected directors of Canadian Pacific are as follows. I would ask each of them to stand and face the audience when introduced, and I'd ask also that you please hold your applause to the end. Bill Ackman, founder and chief executive officer of Pershing Square Capital Management. Gary Colter, president of CRS Inc. and formerly a longstanding leader at KPMG and its predecessor, Peat Marwick, having retired from the Canadian firm as vice chairman in 2002. Isabelle Courville, chairwoman of the board of Laurentian Bank of Canada, formerly a top executive at Hydro-Québec and Bell Canada.
Myself, Paul Haggis, your Chairman, formerly President and Chief Executive Officer of OMERS and President and CEO of Alberta Treasury Branches. Hunter Harrison, your Chief Executive. Paul Hilal, a partner at Pershing Square Capital Management. Krystyne Hoeg, former President and Chief Executive Officer of Corby Distillery. Rebecca MacDonald, founder and current Executive Chair of Just Energy Group. Tony Melman, President and CEO of Acasta Capital and formerly a Managing Director at Onex Corporation. Linda Morgan, partner at the law firm of Nossaman LLP and previously Chair of the U.S. Surface Transportation Board. The Honorable Jim Prentice, Senior Executive Vice President and Vice Chairman of CIBC and a former member of Parliament. Andrew Reardon, most recently a partner at the law firm of Reardon & Chasser, LPA, and former Chairman and Chief Executive Officer of TTX Company, the leading railcar leasing company in North America.
And Steve Tobias, what a great guy, the former vice chairman and chief operating officer of Norfolk and Southern. Ladies and gentlemen, your board. As there is no other business that may properly be brought before the meeting, this concludes the formal business part of the meeting, and I declare the meeting closed. I wish to thank you all for your attending, and I now pass the stage to Hunter Harrison and the management team. Hunter,
thank you very much. Good morning, and thanks for that warm welcome. I should say to my fellow shareholder here that I certainly endorse your statements on say-on-pay. I'm right behind you, okay? So I stand here before you this morning, and I reflect back on this is now my second meeting as your CEO, and God, there's a lot that's happened in the last 12 months.
Then I reflect back almost two years ago now to the proxy contest, and I've finally recovered and got the page turned from all the ugly things that were said about me by some of you. But it's been a fun trip. It's been a fun ride. And there's a lot of people I need to thank this morning. First of all, Paul Haggis, thank you for your dedicated service as our Chairman, leading us through some extremely difficult times coming out of a proxy contest, and I'm being nice when I call it a contest. But Paul was kind of the glue that pulled this board together. I want to thank the board. The board has come together. I think if you look back, two years ago, there's only two remaining from the original board of directors. But the board of directors, it's come together.
They have developed a certain chemistry and an esprit de corps that has been contagious, that has led management and inspired us to achieve some of the things that we've been able to accomplish. So thanks so much to the board of directors. Thank you, as fellow shareholders. Thank you for the confidence that you've shown in us. I hope you're happy. If you're not, I don't know what we got left, okay? But never even could I have predicted that the kind of results that this organization has produced. I'm still shocked every day when I look at the numbers. Now, I've been involved in a couple other turnarounds, first with Illinois Central, and I thought it was a miracle. Second, with my friends in Montreal from Canadian National, which I thought we did a lot and accomplished a lot of things.
But nothing compares closely with what has been done at this organization. And so what I need to do this morning is the biggest thank you I can give is to my fellow railroaders, the men and women of Canadian Pacific, that have done such a wonderful job in creating this value that we have all appreciated so much. Somebody asked me this morning, "What are you going to say? You're going to get up and apologize for what's happened first quarter?" No, I'm not going to apologize. We don't have anything to apologize about. The men and women of this company have gone above and beyond the call of duty in one of the well, clearly, in my career of 50 years with a little two-year respite, the toughest working conditions that I've ever seen. You need to go out there. This is an outdoor sport.
You need to go out there and work at 40 below with the wind whistling and with snow up to your waist. You'll start having appreciation for what some of these people accomplish and do. By the way, there's been a little comments about the supply chain, and maybe that we in the rail business weren't doing our job in the supply chain. But I can tell you this. This organization, this company worked 365 days a year, 7 days a week, 24 hours a day, don't stop for holidays, and we're doing everything we can reasonably to be expected to move, particularly a subject I'm going to talk about in a minute, grain in this company. Now, have the other 2 partners in the supply chain worked like that? No. Does Vancouver work weekends and nights and holidays? No.
All of us have a responsibility to pull together in the supply chain and work collectively together. I've never been through such difficult times where there's so much divisiveness between people and individuals, organizations that should be partners working in a collective spirit trying to solve problems rather than finger-pointing. Let's reflect back on the results in 2013. They're amazing to me. I'll give you just a moment to let some of these numbers sink in. Earnings per share up 48%. Free cash flow of $530 million from a number that was about $60 million or $70 million. Operating ratio of 69.9%. We broke through the 70% barrier. They said it couldn't be done. Think about something. How many people a year ago or two years ago were sitting here reflecting, saying, "I know they can do it"? Not many.
I pull the articles out every so often and read some of them, and it inspires me further to look at what some of the pundits and so-called industry experts had to say. We were the carrier of the year for Lowe's. Special awards and recognition from Toyota. Revenues up 8%. Market cap up to $30 billion from a number that was about if you look back, I think, to the original when the first rumors started circulating in December of, I guess, 2011 now, market cap was about $6 billion-$7 billion. So there's been quite a lot of shareholder value created. So are we prideful of those accomplishments? Absolutely. That's behind us. We've turned the page, and there's more to do. So let me spend a few minutes kind of reflecting on where we are today, particularly to talk to some degree about the regulatory environment.
And it's been a tough year in that regard, both in the U.S. and Canada. I've discovered that we have some industry experts in Washington, D.C., and Ottawa. But they've come out with rules and regs that really don't make sense to me. We had very little, if any, indication of anything that was going to happen regulatory-wise, emergency orders, additional legislation. We had virtually no input into those decisions that were made. So on one side of the coin, we're seeing slow down the crude trains but speed up grain. And they work on the same tracks. We have been blessed here at Canadian Pacific. With one exception, we have had no derailments involving crude except the one here in Calgary. That was as a result of flooding conditions in Western Canada.
There were unprecedented floods where we lost a bridge, and we had some tank cars that didn't officially derail, but the bridge was sinking in. But we responded. First, the emergency organizations responded and had the situation under control. But nowhere, to my knowledge, has anyone had any issues with speed for crude that has caused derailments. But in spite of that, now we have regulations that it appears are going to say that if we have more than 20 cars of crude, the train is restricted to 40 miles per hour. Doesn't make a lot of sense. Now, I was very pleased and very complimentary of the Minister of Transportation, Mrs. Raitt, for her stance on tank cars. We said from day one those tank cars should be outlawed. We certainly recognize our responsibility to the communities we operate through to provide a safe environment.
That's important to the success of our business. So we're trying to figure out where this is going. We've got a mandate now on grain to move effectively, as we talk about it, 5,500 cars a week. Excuse me. So let me take you to the real world for a moment. I know sometimes audible, it will deliver the real world. But we had a restriction put on us with 5,500 cars a week we have to move. And it had no consideration whatsoever for the length of haul that we talk about. So just load 5,500 cars, whether you move them 1 mile or 1,000 miles. So we had a customer response that said, "Thunder Bay is frozen up. We're having a hard time breaking up the ice and getting ships into Thunder Bay.
We have contracts in Europe and obligations, and we need to be able to move the grain there. So could you move some trains from the prairies to the port of Montreal or Quebec City so we can get on the seaway and fulfill our obligations? Our first response was, "Absolutely, we'll try to respond." But we took into account that the length of haul to go to Montreal or Quebec City is about twice as long to go either to Vancouver or Thunder Bay.
But we said, "Surely, surely, the regulators will understand that if we try to respond to the customer, do the right thing, they would be supportive of us." So we called to Ottawa, explained the situation, and the response we got was, "The law is the law is the law." Well, in spite of that, I think you've seen some publicity from some of the grain companies that congratulated the organization for in spite of those restrictions, in spite of those risks, we tried to respond to the customer and move cars going forward. So look, Ottawa, Washington, the regulators are a hurdle for us. We have a responsibility to deal with those individuals and convince them to shape a reasonable regulatory policy that the railroads can respond to customer needs and provide the service that customers deserve. And that's about that.
I could go on all day, but in the interest of time, I will not. But let's look at what we said going forward, what's going to happen. Story is a long way from over, okay? A lot of runway left. So let's talk a little bit about what guidance we've provided to Bay Street and Wall Street going forward and looking out for 2014. In spite of a very, very difficult, I think you would agree, first quarter start we got, which was about 400 basis points better than last year, we said that we would have an operating ratio less than 65. We stand by those forecasts. Earnings per share growth of 30%. Revenue growth top line of 6%-7%.
And some of the analysts said to me the other day, "Is that all?" I said, "6% and 7% is pretty solid growth in my view." Significant improvements in free cash flow. We've announced a very aggressive buyback program. All of these will help you. We'll appreciate your funds as a shareholder. We have talked about a portfolio of real estate, surplus assets that have been accumulated over the years that we think now has a value of somewhere around $2 billion. So the future is pretty bright. Now, let me make just comment in closing. I look back. I've been in this business a long time, and I look back to the mid-1990s—excuse me—Canadian National and Canadian Pacific at that time were at the bottom of the pack of Class I railroads in North America. Now, where are they? They're at the top.
Canada has the finest rail system in the world. I think I'm qualified to make that judgment. Our friends in Montreal, and they're on top, but they have said publicly that they're looking in the rearview mirror, and they're almost going to miss us as we go by. But we've got the finest rail system in the world. Be careful. Be careful playing with the winning combination because this could turn around quickly. There's been a lot of editorials and op-eds written about the policy setting. It's a key, I think, to our future, to the future of Canada. A lot of those policies, if you reflect upon them, don't make a lot of sense. Let me just take one for an example and share with you interswitching. All of a sudden, relatively overnight, interswitching was inserted in the Emergency Act in three provinces.
If it's the thing to do, why not all the provinces? Only in 3 provinces, 160 km interswitching, which effectively says that U.S. carriers can come into Canada and haul whatever commodities but more pointed towards grain than anything else. So what's going to happen? Well, first of all, our friends at Burlington Northern said, "Don't worry about us. We can't handle what we got. It'll take us 2 years to dig out of the hole we're in." But theoretically, what could happen is this. U.S. carriers would come into Canada, 160 km, take Canadian grain and haul it south to the U.S., and go west with it to U.S. ports. Now, what does that do? It hurts the job base in Canada of CP railroaders, to be specific, and Canadian National. It takes the business away from the ports of Vancouver and moves them into PNW.
That's not good policy. These things should be thought through, and hopefully, the review with the CTA and the annual five-year review that we can have a time to sit down and have a dialogue with the regulators and hopefully right this ship. So last year, I said to you that I had effectively two things that I needed to do to this organization that I committed to: turn this big ship around and head it in the right direction. We've done that. It's headed in the right direction. The employees of Canadian Pacific have responded and embraced change better than any group I've ever been associated with and built some sustainability. And we are building sustainability as we speak. I'm very proud of our new headquarters in Ogden that we moved out of downtown.
By the way, I thought the people that did the film clip here did an excellent job doing that. So there's a lot, there's a bright future for this organization going forward, a lot more things to accomplish. In closing, let me just leave you with, and I wasn't going to do this. People think I overuse this quote. But it's my favorite quote by far, and it's so appropriate today. It's a quote by George Bernard Shaw that says, "Forget about the likes and dislikes. Just do what should be done." That's heavy, strong. Think about that. Just do what should be done. That's not happiness, but it's greatness. And greatness is what this organization is pursuing. Thank you. My colleague here.
He was introduced earlier, but Keith Creel, our President, Chief Operating Officer who has done a wonderful job for us in guiding and producing some of these results that I spoke to. We would be happy to respond to any reasonable question you might have.
Yeah. Andrew Pollock of Calgary, Alberta. Beneficial holder of 2 shares of CP Common Stock and proxy holder for those 2 shares. I'm wondering, can you talk a bit about the importance of corporate culture and the changes in corporate culture you've brought to these various railways? And does the fact that these different railways are not identical with one another mean that certain differences between them in corporate culture might be appropriate and helpful, or should they all have an identical corporate culture? The railways that you've worked with and transformed. Thanks.
I'm going to nominate you for our top committee, okay?
If you've got some free time. That's a very appropriate question. I've talked about this a lot internally, and I'm going to ask Keith to comment further on this. But if you look at the railroads in North America, we all run the same gauge. We've got the same locomotive suppliers, same freight cars, same signal systems. What's the difference that one railroad is successful and one's not so successful? It's, to your point, people. It's about our culture. It's about change. Change is difficult for all of us. I thought I was comfortable in retirement, but I missed this business, and it was quite a change and shock to my system. And we've been accused I guess I have been accused of creating a culture of fear. I don't think that's accurate. What we like to think about is the culture of responsibility and accountability.
All we're asking people to do is do what they're instructed to do, do their job, and do it correctly. I think people have responded to that. The key, the secret, if there is anything, to success in business or railroading - and I've learned this - is that surround yourself with good people. Surround yourself with people that understand what you're trying to accomplish. And to the film clip, talk to them about why, why we need to make change, why we need to do the things we do. If you really peel back this onion and look at Canadian Pacific and its accomplishments, if you will, over the last couple of years, it's all about people. We spend a great deal of time, Keith and I both, on evaluating people, training, motivating people, developing people because that's the key to success in this organization.
If we run out of good people, you'll see this organization slip. So Keith, have you got further comments?
Yeah. I would add this company had a tremendous amount of pent-up pride and a desire to do the right thing. From a leadership standpoint, it just wasn't tapped into. So what I found, and I was extremely overwhelmed with, when you go out and you engage employees on the ground, not just sitting in the office in Ogden or here in Gulf Canada Square, but if you get out on where the rubber meets the road or where the steel hits the ballast and you start engaging with employees, they're folks just like you and I. I mean, they have families. They have kids. They have pride. They want to do well. They want to be part of a winning combination, a winning team. But they were lost.
They were extremely lost. A lot of people forgot in this company, this is an operating company. It may not be the sexiest business in the world. It may not be the most appealing business in the world. Sometimes when it's 40 below zero, it's not appealing. But if you tap into that and you let people understand they're part of what it takes to become successful and to sustain success, they're going to respond. And that's what this company has done in spades. That's what inspires me every time I get out of my office and get out on the ground. I don't want to stay in front of my computer and go to meetings and interact in Ottawa and do all those things. They're necessary evils I have to do. But I get energized when I get out on the ground with the people.
And if you create that culture and you create operating officers and ladies, men and women alike that do that, then the people are going to respond. They're going to follow. And this company is going to continue to produce success in spades. And we're not done. We're scratching the surface. I mean, Hunter and I took a hi-rail trip two weeks ago. And quite frankly, I have pride as well. I was quite embarrassed in what I saw. But at the same time, what's embarrassing today is an opportunity tomorrow. And if you command and gather people and you get some momentum around those issues, they start to convert, spreads across the company, and success repeats itself. And you just build upon the foundation. So similar cultures, I think, operating culture. I think culture of accountability. I think culture of responsibility. Let people know they have value.
They play a part. They'll meet the responsibility they'll produce in spades.
Other questions?
I can't understand why more people don't ask questions. I probably get to ask more questions of the most distinguished corporate leaders in the country than anybody except Howard Green just because I actually show up at annual meetings.
You're doing a hell of a job. Keep it up.
Yeah. Yeah. Yeah. But my other question, before you retired from your previous position, from what I heard in the media, you were planning to write a book or two about leadership. Is that going to happen perhaps after you retire from this job? But when you do retire from this job, just remember that when Ronald Reagan became president of the U.S., 2.5 weeks later, he turned 70. When he retired, about 2.5 weeks later, he turned 78.
You're just the right age so that when you retire from CP, you can go and bring down the operating ratio of the whole United States of America. Thanks.
Amen. Now, look, we have, and I'll, given your participation this morning, I'll share with you two books that we have written on leadership. And I think it's important to maybe give you the background of why the books were written. When I first went to, not long after I went to Canadian National, and I saw that there needed to be, in my view at least, a lot of changes made, the one thing we didn't do and failed to do was explain to people, back to the film clip, why they needed to change, what's in it for them.
There was going to be such a cultural change and shock, and our new vice president of human resources said, "We want to contribute to this model of scheduled precision railroad. What could we do to be helpful?" I sat back, and I reflected a minute, and I said, "What I'd love to be able to do is to sit down with every employee face-to-face and say, 'Look, here's what we're doing. Here's why we're trying to do it. This is what the organization that you work for is all about.'" So that they could take some pride in that.
So what started off as going to be a 3 or 4-page little pamphlet turned into a book called How We Work and Why, which was I don't know if it was a bestseller because it didn't get a lot of printing, but I looked on eBay about 2 months ago, and it was going for $1,019. So you're going to get a bargain from me, okay? And then I wrote another book as a result of the response of that called Change, Leadership, Mud, and Why, which was kind of a sequel to the How We Work and Why, which we have shared with folks. Now, I've got a lot of other notes and books and people that have approached me about writing. I'm going to write some of them, and once I'm gone, then I'll release them, okay? I'm not doing it before then.
But I've become so engaged in this new opportunity and position here that I've been given that I hadn't had time for that. But hopefully, when I am successful in retirement, then I'll take some time to do maybe a book on leadership. Any other questions? Well, thanks so much for joining us. Thanks for the confidence that you've shown in this board of directors and management team. And we will continue to work diligently to see that you get a fair return on your investment. Thank you.