Canadian Pacific Railway warned that its earnings will be down in the first quarter as harsh winter weather hampered train operations and fuel recovery surcharges lagged.

But the company said operations were returning to normal as weather conditions moderating, and the setbacks will not derail its long-term effort to improve operational efficiency and cut its operating ratio.

Canadian Pacific said it now expects its earnings per share to be in the range of 12 to 22 Canadian cents, which would be down from the 59 Canadian cents per share it reported in the same quarter of 2010 and its 36 cents per share in 2009.

Analysts were projecting earnings of 71 Canadian cents per share, with individual predictions ranging from 51 cents to 86 cents, according to a survey by Thomson Reuters I/B/E/S.

The company said “multiple severe weather events” disrupted train operations across its network in Canada and the northern United States, including avalanches on its mainline tracks in British Columbia.

“The impact of avalanche disruptions are just one factor that increased fivefold this year in our busiest corridor through the mountains causing very inefficient stop-start operations.” Chief Executive Fred Green said in statement. (Reuters)