Canadian Pacific Railway Ltd. reported record second quarter revenues of $2.05 billion Wednesday.

The Calgary-based railway reported earnings of $1.25 billion for the three months ended June 30, up from $635 million in the same period last year. CP Rail's adjusted earnings per share were $1.03, a 27 per cent increase from $0.81 last year and a second quarter record.

The company also declared a quarterly dividend of $0.19 per share, payable in October.

The company's operating ratio, a key measure of railroad efficiency where a smaller number is better, increased by 301 basis points to 60.1 per cent from 57.0 per cent. Included in that metric are $308 million in expenses related to CP's efforts to acquire Kansas City Southern.

In May, KCS formally backed a merger offer from CP rival, Montreal-based Canadian National Railway Co. KCS paid a US$700-million termination fee for backing away from its previous agreement to be purchased by CP.

CP says it is continuing its application process to acquire KCS, in case the CN deal is terminated or CN cannot otherwise acquire KCS.