##### 



Exhibit 1

MANAGEMENTS DISCUSSION AND ANALYSIS

CP Ships overall performance in 2001 was strong given deteriorating business
conditions in the container shipping industry.

Operating income of $139 million before goodwill and exceptional charges was
down only $25 million from a record $164 million in 2000. Significantly
stronger performance in the Latin American market and improved results in the
Australasian market were offset by lower operating income in the TransAtlantic
market and losses in the Asian market.

EBITDA for 2001 at $213 million was down by only $11 million from $224 million
in 2000.

Net income for 2001 was $76 million after exceptional charges of $36 million,
compared to $135 million in 2000.

|                  |  |      |       |      |  |  |       | 
|----------------- |  | ---- | ----- | ---- |  |  | ----- | 
|($ millions)      |  | 2001 |       | 2000
|                  |  |      |       |     
|Volume (teu 000s) |  |      | 1,842 |      |  |  | 1,833 | 
|Revenue           |  |      | 2,646 |      |  |  | 2,645 | 
|Expenses          |  |      | 2,507 |      |  |  | 2,481 | 
|                  |  |      |       |     
|Operating Income1 |  |      | 139   |      |  |  | 164   | 
|EBITDA2           |  |      | 213   |      |  |  | 224   | 
|Net Income        |  |      | 76    |      |  |  | 135   | 



---

|1 |  | Before exceptional and goodwill charges                                                    
|- |  | -------------------------------------------------------------------------------------------
| 
|2 |  | Earnings before interest, tax, depreciation, amortization, exceptional and
goodwill charges

[Photo of containers at marine terminal]

Containers are sometimes stored at the marine terminal until their
pre-scheduled ship arrives.

16



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##### 



MANAGEMENTS DISCUSSION AND ANALYSIS

Earnings per share in 2001 was $0.92, but excluding exceptional charges was
$1.37, compared with $1.68 in 2000.

A slowdown in world economic growth, particularly in the US, led to slower
container trade growth. According to a leading industry consultants latest
estimate, container trade grew by only 4% in 2001 compared with 13% in 2000.
Slower growth was accompanied by an increase in world containership capacity of
12% in 2001, most of it directly into Asian trades but with a general knock-on
effect in many other trade lanes.

REVENUE

Revenue at $2.65 billion in 2001 was flat compared with 2000. Container
carryings at 1.84 million teu were slightly higher than 2000 with volume growth
from new Asian services offset by reduced volume in the TransAtlantic.

CPShips2001 average freight rate, which excludes inland transport and slot
charter revenues, improved by 1% compared to 2000, but declined sequentially in
the second, third, and fourth quarters reflecting an overall deterioration in
trade conditions. This reversed the trends in 2000 when more balanced supply of
ship capacity to container trade demand led to increasing freight rates during
the year in nearly all markets.

EXPENSES

Total expenses increased by 1% in 2001 to $2.51 billion from $2.48 billion in
2000. Container shipping operations expenses increased to $2.07 billion in 2001
from $2.04 billion in 2000 with the implementation of new services, notably in
the Asia-Europe trade lanes, partly offset by lower fuel costs and a vigorous
cost reduction program.

[Photo of Cast Power]

The 1900 teu ice-strengthened Cast Power operates with six other CP Ships
vessels on the TransAtlantic US/Canada via Montreal-North Europe route. CP
Ships provides three weekly services on this route.

17



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##### 



General and administrative expenses declined due to tight cost control and
smaller cash bonus payments on lower profits. Higher depreciation reflects
capital investment in ships.

|                              |  |      |       |      |  |  |       | 
|----------------------------- |  | ---- | ----- | ---- |  |  | ----- | 
|($ millions)                  |  | 2001 |       | 2000
|                              |  |      |       |      |  |  |      
|Container Shipping Operations |  |      | 2,068 |      |  |  | 2,037 | 
|General and Administrative    |  |      | 363   |      |  |  | 381   | 
|Depreciation                  |  |      | 74    |      |  |  | 60    | 
|Other                         |  |      | 2     |      |  |  | 3     | 
|                              |  |      |       |     
|Total Expenses                |  |      | 2,507 |      |  |  | 2,481 | 

On a unit cost basis, CP Ships cost per teu* increased by 0.5% to $1271 in 2001
from $1265 in 2000, having fallen between 1996 and 2000 by 15%. The increase
was due to the effect of lower TransAtlantic volume and the start up of new
services in the Asian market.

In 2001, 51% of total expenses were fixed including ship network, container and
general and administrative costs. However, although categorized as fixed
expenses, CP Ships regularly adjusts its ship network and container fleet in
response to changes in business demand. The remaining 49% were variable costs
including inland transport, terminal and empty container positioning costs.

[Photo of Direct Condor]

The 2000 teu Direct Condor operates with six other CP Ships containerships in
the US West Coast-Australasia trade lane where the company offers two services.

EXCEPTIONAL CHARGES

Exceptional charges in 2001 were $36 million. Of this, $17 million was the cost
of the spin-off from former parent Canadian Pacific Limited, including $7
million for professional fees and other expenses and $10 million for the
conversion of the existing cash-based long-term incentive plan into restricted
stock awards. The remaining $19 million was for rationalizing organization and
offices, mostly in North America and Europe, to improve efficiency, reduce
costs and strengthen competitive positioning.

*Cost per teu is total cost divided by volume in teu. Total cost excludes gains
and losses on disposal of capital assets and from currency exchange. It also
excludes CTE, a business sold in 2000, and is after deducting slot charter
revenue.

18



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##### 



MANAGEMENTS DISCUSSION AND ANALYSIS

Operating Results by Market

TRANSATLANTIC MARKET

Operating income declined by $10 million to $79 million in 2001. Average
freight rates were 3% higher than in 2000 but volume was 9% lower due to a
decline in total trade and increased competition in Mediterranean trade lanes.

Operating income in the fourth quarter 2001 at $29 million increased by $15
million compared to the third quarter 2001 with a one-off cost reduction and
higher slot charter income, increased volume and improved inland transport
revenues. This was partly offset by a 3% decline in average freight rates from
the third quarter.

In 2001, four chartered ships were replaced with owned ships in the US East
Coast/Gulf-North Europe trade lane thereby reducing ship network costs.
Services in the US/Canada via Montreal-Mediterranean trade lane were also
restructured with improved service.

|                  |  |      |       |      |  |  |       | 
|----------------- |  | ---- | ----- | ---- |  |  | ----- | 
|($ millions)      |  | 2001 |       | 2000
|                  |  |      |       |     
|Volume (teu 000s) |  |      | 942   |      |  |  | 1,033 | 
|Revenue           |  |      | 1,323 |      |  |  | 1,406 | 
|Expenses          |  |      | 1,244 |      |  |  | 1,317 | 
|                  |  |      |       |     
|Operating Income  |  |      | 79    |      |  |  | 89    | 

[Photo of Cast Progress]

The 2900 teu Cast Progress, the largest of seven CP Ships containerships
operating in the TransAtlantic US/Canada via Montreal-North Europe trade lane,
where CP Ships offers three weekly services.

19



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##### 



AUSTRALASIAN MARKET

Operating income at $29 million in 2001 improved by $6 million over 2000. Lower
operating costs offset weaker volume, which was down 2% due to continuing
slower imports into Australasia. Average freight rates for 2001 were stable
compared to 2000.

Fourth quarter operating income at $7 million was $2 million lower than in the
third quarter with freight rates down 4% due to increased competition in all
trade lanes.

In March 2001, a joint service in the US West Coast-Australasia trade lane was
formed with three other carriers. The new arrangement has reduced ship
operating costs and improved port coverage, port call frequency and transit
times.

|                  |  |      |     |      |  |  |     | 
|----------------- |  | ---- | --- | ---- |  |  | --- | 
|($ millions)      |  | 2001 |     | 2000
|                  |  |      |     |     
|Volume (teu 000s) |  |      | 348 |      |  |  | 356 | 
|Revenue           |  |      | 549 |      |  |  | 574 | 
|Expenses          |  |      | 520 |      |  |  | 551 | 
|                  |  |      |     |     
|Operating Income  |  |      | 29  |      |  |  | 23  | 

[photo]

ANZDLs 1700 teu Direct Kestrel in Sydney Harbour, one of seven containerships
deployed by CP Ships in two weekly US West Coast-Australasia services.

20



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##### 



MANAGEMENTS DISCUSSION AND ANALYSIS

LATIN AMERICAN MARKET

Operating income increased by 56% to $28 million in 2001 due mainly to a 6%
increase in average freight rates. Volume increased 4% (after adjusting for the
West Coast North America-West Coast South America service which was integrated
during 2001 with Asia-Americas services in the Asian market) due to strong
exports from Brazil and the new service between the Mediterranean and East
Coast South America. The economic crisis in Argentina, which occured late in
the year, did not affect 2001 results.

Operating income in the fourth quarter declined $3 million to $7 million
compared with the third quarter with weaker imports into Latin America and 5%
lower average freight rates.

In the second quarter three chartered ships were added in an expanded
Gulf-Caribbean service. In addition, during the year operating costs were
reduced by replacing chartered ships with three owned 2100 teu ships in the
Gulf-East Coast South America trade lane and by renewing charters at lower
rates.

|                  |  |      |     |      |  |  |     | 
|----------------- |  | ---- | --- | ---- |  |  | --- | 
|($ millions)      |  | 2001 |     | 2000
|                  |  |      |     |     
|Volume (teu 000s) |  |      | 162 |      |  |  | 177 | 
|Revenue           |  |      | 244 |      |  |  | 242 | 
|Expenses          |  |      | 216 |      |  |  | 224 | 
|                  |  |      |     |     
|Operating Income  |  |      | 28  |      |  |  | 18  | 

[photo]

The 2500 teu Contship Spirit is deployed in a weekly North Europe-East Coast
South America service.

21



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##### 



ASIAN MARKET

The operating loss of $13 million in 2001 compares with a $20 million profit in
2000. Volume increased by more than 50% with a consequent increase in operating
costs as the scope of the Asian businesses was expanded significantly. More
adverse market conditions due to excess capacity affected to varying degrees
all three trades: India, Asia-Americas and particularly the start-up
Asia-Europe trade.

Operating losses in the fourth quarter increased to $13 million from $2 million
in the third quarter. Average freight rates dropped by 6% mostly due to
Asia-Europe.

In March 2001, CP Ships entered the Asia-Europe trade by way of slot charters on
three services. During the first six months of 2001, four owned 3300 teu ships
were introduced into a restructured Asia-Americas trade lane. In September a
new service was started as a slot charter between Asia, South Africa and East
Coast South America. During the fourth quarter a chartered ship was withdrawn
from one of the Asia-Americas services in response to lower demand.

|                        |  |      |     |      |  |  |     | 
|----------------------- |  | ---- | --- | ---- |  |  | --- | 
|($ millions)            |  | 2001 |     | 2000
|                        |  |      |     |     
|Volume (teu 000s)       |  |      | 331 |      |  |  | 216 | 
|Revenue                 |  |      | 435 |      |  |  | 337 | 
|Expenses                |  |      | 448 |      |  |  | 317 | 
|                        |  |      |     |     
|Operating (Loss)/Income |  |      | (13 | )    |  |  | 20  | 

[photo]

The 2200 teu Contship Washington, one of four company ships deployed in the
Australasian markets Ocean Star Round-the-World service.

22



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##### 



MANAGEMENTS DISCUSSION AND ANALYSIS

OTHER ACTIVITIES

Operating income from other markets and activities increased by $2 million to
$16 million in 2001. A 16% increase in volume contributed to improved results
in the North America-South Africa trade lane and results for break-bulk
services were improved due to lower costs. Income from Montreal Gateway
Terminalsoperations declined due to lower TransAtlantic volume. In 2001,
increased profits were earned from chartering out ships that were temporarily
surplus and awaiting deployment.

|                 |  |      |    |      |  |  |    | 
|---------------- |  | ---- | -- | ---- |  |  | -- | 
|($ millions)     |  | 2001 |    | 2000
|                 |  |      |    |     
|Revenue          |  |      | 95 |      |  |  | 86 | 
|Expenses         |  |      | 79 |      |  |  | 72 | 
|                 |  |      |    |     
|Operating Income |  |      | 16 |      |  |  | 14 | 

OUTLOOK

Industry experts predict that overall global container trade growth in 2002
will be faster than the 4% growth in 2001. During the first half of 2002 growth
is forecast to be slower, improving into the second half. Growth in some
markets including the TransAtlantic may remain flat for much of the year.

There are already signs that freight rates may have bottomed out in the
Asia-Europe trade following capacity reduction initiatives by some carriers.
While it is anticipated that there will be further capacity rationalization in
other trades, CP Ships expects market conditions to remain difficult with
significant deliveries of new container ships through the rest of 2002 and into
2003.

CP Ships results in the seasonally weak first quarter are expected to be poor
and may show a modest loss. However, with seasonally stronger volumes expected
from the second quarter onwards, and with further cost reductions, schedule
rationalization and higher trade growth, CP Ships anticipates to be profitable
overall in 2002 although at a lower level than in 2001.

[photo]

The Roll-On Roll-Off Lykes Winner also has a container carrying capacity of 700
teu and operates in the North America-South Africa trade lane.

23



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##### 



OTHER CONSOLIDATED INCOME STATEMENT ITEMS

Net Interest

Net interest income fell by $1 million in 2001 as interest-free loans from
former affiliates were replaced from the end of the third quarter 2001 with
bank debt at market rates.

Income Tax

The CP Ships group has been structured so that much of the income it generates
from container shipping carries tax at relatively low rates.

In 2000 the principal tax-paying subsidiary, based in the UK, benefited from
carry forward tax losses and other allowances. On 1st January 2001, this
subsidiary entered the UKs new Tonnage Tax scheme where tax expense is based
on the size of ships in its fleet rather than profits earned. Further, as a
consequence of the reorganization under the spin-off, some Bermuda-based
activities were transferred to the UK company and to the Tonnage Tax scheme. Reduced tax
expense for the group overall is anticipated over the long term under Tonnage
Tax. Furthermore, CP Ships tax expense is now less dependent on the level of
profits earned.

Income tax expense in 2001 at $12 million was the same as in 2000. Due to the
fall in income before tax to $103 million from $165 million, the effective tax
rate was 11.7% in 2001 compared to 7.3% in 2000.

Goodwill Charges

Amortization of goodwill was $16 million in 2001, down $2 million on the
previous year due to a portion of goodwill being fully written down in 2000. In
accordance with new Canadian accounting principles, goodwill will not be
amortized during 2002, but subject to an impairment test at least annually. The
impact of not amortizing goodwill for the year ended 31st December 2001 would
have been to increase net income by $16 million.

Dividends

Dividends of $3 million in 2001 and $2 million in 2000 were paid on preference
shares outstanding from mid-2000 to mid-2001 issued to a former affiliate.

On 25th January 2002, CP Ships Board of Directors declared a dividend for the
fourth quarter 2001 of $0.04 per common share, which was paid on 22nd February
2002 to shareholders of record on 7th February 2002.

[Photo]

The ice-strengthened 2800 teu Canmar Pride is purpose-built for the
TransAtlantic US/Canada via Montreal-North Europe trade lane.

24



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##### 



MANAGEMENTS DISCUSSION AND ANALYSIS

SHIP REPLACEMENT PROGRAM

In 2000, CP Ships began a four-year $1.25 billion capital investment program to
replace chartered ships, mainly inherited with acquisitions, with owned ships
and to replace leased containers with owned. In the fourth quarter 2001, $200
million planned for investment in ships and the $250 million for containers was
postponed, due to weak market conditions. There are no commitments against the
postponed $450 million.

The replacement ships will be medium-sized from 2000 to 4000 teu, the optimal
size range for regional trades. Each is specialized for its proposed trade. Two
are ice-strengthened, three have the capacity to carry a significant number of
refrigerated containers for temperature sensitive cargo and five are geared,
having on-board cranes enabling them to operate in ports without shoreside
cranes. In late 2000 and early 2001 twelve used ships were delivered. The
program is on schedule with ten newbuilds plus six long-term newly built
chartered ships, and one used ship, all due for delivery from mid-2002 to
mid-2003. The investment is intended to be financed by cash from operations and
by borrowings.

CP Ships considers that it can reduce costs over the medium and long-term by
owning ships rather than chartering them as the cost of ownership has
historically been lower than chartering. In the meantime, it has been able to
benefit from the current decline in charter rates. At 31st December 2001,
chartered ships represented about 55% of the ship fleet and significant cost
savings were achieved from recent renewals at lower rates. With more than 20
charter renewals due in 2002, further significant savings are expected.

On completion of the replacement program by
mid-2003, CP Ships will own or
long-term charter about 70% of its ship capacity. The remaining 30% chartered
will leave sufficient flexibility to manage the fleet according to changing
market conditions. The program will increase capacity by about 16%, which is
consistent with expected growth in trade over the four-year period.

[Photo]

A CP Ships containership under construction.

|                  |  |       |     |             |  |       |     |      |  |      |     |       |  |  |     |  |  |  |     |  |  |  |     |  |  |       |     | 
|----------------- |  | ----- | --- | ----------- |  | ----- | --- | ---- |  | ---- | --- | ----- |  |  | --- |  |  |  | --- |  |  |  | --- |  |  | ----- | --- | 
|                  |  |       |     |             |  |       |     |      |  |      |     |       |  |  |     |  |  |  |     |  |  |  |     |  |  | GRAND
|                  |  | SPENT |     | OUTSTANDING |  | TOTAL
|                  |  |       |     |             |  |      
|($ millions)      |  | 2000  |     | 2001        |  | Total |     | 2002 |  | 2003 |     | Total |  |  |     | 
|                  |  |       |     |             |  |       |     |      |  |      |     |       |  |  |     | 
|Used Ships        |  |       | 161 |             |  |       | 148 |      |  |      | 309 |       |  |  |    |  |  |  | 31  |  |  |  | 31  |  |  |       | 340 | 
|New Ships         |  |       | 66  |             |  |       | 25  |      |  |      | 91  |       |  |  | 223 |  |  |  | 139 |  |  |  | 362 |  |  |       | 453 | 
|                  |  |       |     |             |  |       |     |      |  |      |     |       |  |  |     | 
|Total Expenditure |  |       | 227 |             |  |       | 173 |      |  |      | 400 |       |  |  | 223 |  |  |  | 170 |  |  |  | 393 |  |  |       | 793 | 

25



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##### 



LIQUIDITY AND CAPITAL RESOURCES

Cash from operations in 2001 was $192 million, up $18 million on 2000 mainly
due to improved non-cash working capital movements.

In August 2001, CP Ships arranged a secured four-year revolving credit facility
of $175 million. Of this, $160 million was drawn by the year end to repay $50
million net loans from former affiliates on the spin-off and to finance part of
the $292 million investment in capital assets during 2001. The investment
included assets of $185 million for three used and two new ships, four
previously leased ships and further stage payments of $25 million on the ten
ships under construction.

In 2000, investment in capital assets was $307 million including $161 million
on seven used ships and $66 million stage payments on ships under construction.
This was financed by $203 million new capital from Canadian Pacific Limited and
cash from operations.

At 31st December 2001, long-term debt was $230 million, compared with $32
million at 31st December 2000 due to investment in capital assets and the
repayment of short-term debt to Canadian Pacific Limited on the spin-off. Net
debt at 31st December 2001 was $114 million, representing 9% of total capital.
There was no net debt at 31st December 2000.

In December 2001, CP Ships finalized $250 million of a planned $350 million
second secured revolving credit facility over five years, bringing bank
facilities to $425 million. Subsequent to the year end, the remaining $100
million was committed, to increase total facilities to $525 million.

CP Ships considers that it will be able to meet its known financial commitments
from cash from operations and borrowing facilities.

[Photo]

The ice-strengthened 2300 teu Canmar Courage, one of seven company ships
operating in the TransAtlantic US/Canada via Montreal-North Europe trade lane.

26



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##### 



MANAGEMENTS DISCUSSION AND ANALYSIS

[Photo]

A trainload of double-stacked containers heads toward inland destinations.

RISK ANALYSIS

Foreign Currency Exchange Risk

CP Ships is an international business and its operations and financial results
are exposed to the effects of changes in financial markets and economic
conditions. The functional and reporting currency is the US Dollar. A
proportion of revenues and expenses are denominated in non-US currencies and
consequently the company is subject to the effect of movements in relevant US
Dollar exchange rates.

The most significant non-US currency exposures are in Canadian Dollars, Euros
and British Pounds. In general, a strengthening of these currencies relative to
the US Dollar has a negative effect on operating income. Conversely, a
weakening of these currencies would have a beneficial effect.

The estimated effect of a 1% devaluation of the US Dollar exchange rate against
the Canadian Dollar, Euro and British Pound is a decrease in operating income
of approximately $4 million based upon revenues and expenses for the year ended 31st December 2001.

CP Ships enters into contracts as it deems appropriate to hedge some or all of
its anticipated net currency exposures. Gains and losses resulting from
designated hedge contracts are recognized in income in the same period that the
hedged exposure is recognized. At 31st December 2001, there were no hedging
arrangements outstanding.

Interest Rate Risk

CP Ships is exposed to interest rate risk to the extent that its borrowings,
such as the two revolving credit facilities, are at floating interest rates.
Interest rate risk is not currently hedged. Each increase in interest rates of
1% would result in a decrease in net income of $2
million based on floating rate borrowings at 31st December 2001. Each decrease
of 1% in interest rates would result in an increase of net income of $2
million.

27



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##### 



TEN YEAR COMPARISON

(unaudited)

|                                  |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |      |  |  |  |      |  |  |  |      |  |  |  |      |  |  |  |      | 
|--------------------------------- |  | ---- | --- | ---- |  | ---- | --- | ---- |  | ---- | --- | ---- |  | ---- | --- | ---- |  | ---- | --- | ---- |  |  | ---- |  |  |  | ---- |  |  |  | ---- |  |  |  | ---- |  |  |  | ---- | 
|                                  |  | 1992 |     | 1993 |  | 1994 |     | 1995 |  | 1996 |     | 1997 |  | 1998 |     | 1999 |  | 2000 |     | 2001
|                                  |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |     
|Volume (teu millions)             |  |      | .17 |      |  |      | .20 |      |  |      | .24 |      |  |      | .40 |      |  |      | .48 |      |  |  | .67  |  |  |  | 1.16 |  |  |  | 1.37 |  |  |  | 1.83 |  |  |  | 1.84 | 
|Revenue ($ billions)              |  |      | .30 |      |  |      | .34 |      |  |      | .41 |      |  |      | .69 |      |  |      | .78 |      |  |  | 1.03 |  |  |  | 1.78 |  |  |  | 1.88 |  |  |  | 2.64 |  |  |  | 2.65 | 
|EBITDA1 ($ millions)              |  |      | 28  |      |  |      | 53  |      |  |      | 77  |      |  |      | 79  |      |  |      | 106 |      |  |  | 142  |  |  |  | 163  |  |  |  | 137  |  |  |  | 224  |  |  |  | 213  | 
|Operating Income2 ($ millions)    |  |      | 17  |      |  |      | 44  |      |  |      | 64  |      |  |      | 62  |      |  |      | 86  |      |  |  | 115  |  |  |  | 127  |  |  |  | 89   |  |  |  | 164  |  |  |  | 139  | 
|Cash From Operations ($ millions) |  |      | 21  |      |  |      | 58  |      |  |      | 75  |      |  |      | 64  |      |  |      | 117 |      |  |  | 118  |  |  |  | 135  |  |  |  | 29   |  |  |  | 174  |  |  |  | 192  | 
|Ships                             |  |      | 6   |      |  |      | 7   |      |  |      | 9   |      |  |      | 14  |      |  |      | 14  |      |  |  | 47   |  |  |  | 72   |  |  |  | 76   |  |  |  | 94   |  |  |  | 78   | 
|Containers (teu 000s)             |  |      | 25  |      |  |      | 29  |      |  |      | 36  |      |  |      | 64  |      |  |      | 65  |      |  |  | 175  |  |  |  | 232  |  |  |  | 303  |  |  |  | 327  |  |  |  | 345  | 

QUARTERLY FREIGHT RATE CHANGES 2001 AND 2000

(unaudited)

|                  |  |      |    |      |  |      |    |      |  |      |    |      |  |      |   |      |  |  |    |   |  |  |    |   |  |  |   |  |  |  |   | 
|----------------- |  | ---- | -- | ---- |  | ---- | -- | ---- |  | ---- | -- | ---- |  | ---- | - | ---- |  |  | -- | - |  |  | -- | - |  |  | - |  |  |  | - | 
|                  |  | Q4   |    | Q3   |  | Q2   |    | Q1   |  | Q4   |    | Q3   |  | Q2   |   | Q1  
|Percentage change |  | 2001 |    | 2001 |  | 2001 |    | 2001 |  | 2000 |    | 2000 |  | 2000 |   | 2000
|                  |  |      |    |      |  |      |    |      |  |      |    |      |  |      |   |     
|TransAtlantic     |  |      | (3 | )    |  |      | (2 | )    |  |      | (3 | )    |  |      | 4 |      |  |  | 4  |   |  |  | 2  |   |  |  | 3 |  |  |  | 1 | 
|Australasia       |  |      | (4 | )    |  |      | (2 | )    |  |      | (2 | )    |  |      | 6 |      |  |  | (2 | ) |  |  | (1 | ) |  |  | 2 |  |  |  | 4 | 
|Latin America     |  |      | (5 | )    |  |      | (1 | )    |  |      | (2 | )    |  |      | 2 |      |  |  | 1  |   |  |  | 11 |   |  |  | 5 |  |  |  | 8 | 
|Asia              |  |      | (6 | )    |  |      | (8 | )    |  |      |    |      |  |      |   |      |  |  |    |   |  |  |    |   |  |  |   |  |  |  |   | 
|Total             |  |      | (4 | )    |  |      | (1 | )    |  |      | (1 | )    |  |      | 1 |      |  |  | 2  |   |  |  | 3  |   |  |  | 3 |  |  |  | 1 | 

Percentage increase (decrease) compared with previous quarter in average
freight rates, which exclude inland revenue and slot charter revenue. Asia is
excluded prior to Q3 due to substantial change in mix of trade lanes during the
period. Total is all trade lanes.

[Photo]

The 2400 teu TMM Nuevo Leon is one of four company containerships deployed in
the Gulf-Mediterranean trade lane where CP Ships offers service every nine
days.



---

|1 |  | Earnings before interest, tax, depreciation, amortization, exceptional and
goodwill charges
|- |  | -------------------------------------------------------------------------------------------
| 
|2 |  | Before exceptional charges                                                                 

28



---



##### 



SUPPLEMENTAL INFORMATION

QUARTERLY RESULTS 2001 and 2000

(unaudited)

|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|----------------------------- |  | ---- | --- | ---- |  | ---- | --- | ---- |  | ---- | --- | ---- |  | ---- | --- | ---- |  |  | --- |  |  |  | --- |  |  |  | --- |  |  |  | --- | -
|$ millions                    |  | Q4   |     | Q3   |  | Q2   |     | Q1   |  | Q4   |     | Q3   |  | Q2   |     | Q1  
|                              |  | 2001 |     | 2001 |  | 2001 |     | 2001 |  | 2000 |     | 2000 |  | 2000 |     | 2000
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |     
|Volume (000s teu)             |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|TransAtlantic                 |  |      | 233 |      |  |      | 227 |      |  |      | 245 |      |  |      | 237 |      |  |  | 251 |  |  |  | 258 |  |  |  | 272 |  |  |  | 252 |  
|Australasia                   |  |      | 90  |      |  |      | 89  |      |  |      | 89  |      |  |      | 80  |      |  |  | 96  |  |  |  | 91  |  |  |  | 85  |  |  |  | 84  |  
|Latin America                 |  |      | 39  |      |  |      | 41  |      |  |      | 41  |      |  |      | 41  |      |  |  | 42  |  |  |  | 43  |  |  |  | 45  |  |  |  | 47  |  
|Asia                          |  |      | 94  |      |  |      | 96  |      |  |      | 79  |      |  |      | 62  |      |  |  | 65  |  |  |  | 60  |  |  |  | 50  |  |  |  | 41  |  
|Other                         |  |      | 12  |      |  |      | 16  |      |  |      | 14  |      |  |      | 17  |      |  |  | 13  |  |  |  | 12  |  |  |  | 12  |  |  |  | 14  |  
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|Total Volume                  |  |      | 468 |      |  |      | 469 |      |  |      | 468 |      |  |      | 437 |      |  |  | 467 |  |  |  | 464 |  |  |  | 464 |  |  |  | 438 |  
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|Revenue                       |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|TransAtlantic                 |  |      | 334 |      |  |      | 315 |      |  |      | 339 |      |  |      | 335 |      |  |  | 347 |  |  |  | 356 |  |  |  | 364 |  |  |  | 339 |  
|Australasia                   |  |      | 140 |      |  |      | 136 |      |  |      | 142 |      |  |      | 131 |      |  |  | 152 |  |  |  | 149 |  |  |  | 139 |  |  |  | 134 |  
|Latin America                 |  |      | 59  |      |  |      | 62  |      |  |      | 63  |      |  |      | 60  |      |  |  | 62  |  |  |  | 63  |  |  |  | 58  |  |  |  | 59  |  
|Asia                          |  |      | 115 |      |  |      | 124 |      |  |      | 108 |      |  |      | 88  |      |  |  | 100 |  |  |  | 95  |  |  |  | 78  |  |  |  | 64  |  
|Other                         |  |      | 21  |      |  |      | 26  |      |  |      | 23  |      |  |      | 25  |      |  |  | 25  |  |  |  | 22  |  |  |  | 19  |  |  |  | 20  |  
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|Total Revenue                 |  |      | 669 |      |  |      | 663 |      |  |      | 675 |      |  |      | 639 |      |  |  | 686 |  |  |  | 685 |  |  |  | 658 |  |  |  | 616 |  
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|Expenses                      |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|TransAtlantic                 |  |      | 305 |      |  |      | 301 |      |  |      | 321 |      |  |      | 317 |      |  |  | 322 |  |  |  | 334 |  |  |  | 335 |  |  |  | 326 |  
|Australasia                   |  |      | 133 |      |  |      | 127 |      |  |      | 132 |      |  |      | 128 |      |  |  | 146 |  |  |  | 142 |  |  |  | 133 |  |  |  | 130 |  
|Latin America                 |  |      | 52  |      |  |      | 52  |      |  |      | 56  |      |  |      | 56  |      |  |  | 56  |  |  |  | 56  |  |  |  | 55  |  |  |  | 57  |  
|Asia                          |  |      | 128 |      |  |      | 126 |      |  |      | 107 |      |  |      | 87  |      |  |  | 96  |  |  |  | 89  |  |  |  | 72  |  |  |  | 60  |  
|Other                         |  |      | 16  |      |  |      | 23  |      |  |      | 20  |      |  |      | 20  |      |  |  | 19  |  |  |  | 18  |  |  |  | 18  |  |  |  | 17  |  
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|Total Expenses                |  |      | 634 |      |  |      | 629 |      |  |      | 636 |      |  |      | 608 |      |  |  | 639 |  |  |  | 639 |  |  |  | 613 |  |  |  | 590 |  
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|Operating Income2             |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|TransAtlantic                 |  |      | 29  |      |  |      | 14  |      |  |      | 18  |      |  |      | 18  |      |  |  | 25  |  |  |  | 22  |  |  |  | 29  |  |  |  | 13  |  
|Australasia                   |  |      | 7   |      |  |      | 9   |      |  |      | 10  |      |  |      | 3   |      |  |  | 6   |  |  |  | 7   |  |  |  | 6   |  |  |  | 4   |  
|Latin America                 |  |      | 7   |      |  |      | 10  |      |  |      | 7   |      |  |      | 4   |      |  |  | 6   |  |  |  | 7   |  |  |  | 3   |  |  |  | 2   |  
|Asia                          |  |      | (13 | )    |  |      | (2  | )    |  |      | 1   |      |  |      | 1   |      |  |  | 4   |  |  |  | 6   |  |  |  | 6   |  |  |  | 4   |  
|Other                         |  |      | 5   |      |  |      | 3   |      |  |      | 3   |      |  |      | 5   |      |  |  | 6   |  |  |  | 4   |  |  |  | 1   |  |  |  | 3   |  
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|Total Operating Income        |  |      | 35  |      |  |      | 34  |      |  |      | 39  |      |  |      | 31  |      |  |  | 47  |  |  |  | 46  |  |  |  | 45  |  |  |  | 26  |  
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|Analysis of Expenses          |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|Container shipping operations |  |      | 524 |      |  |      | 519 |      |  |      | 524 |      |  |      | 501 |      |  |  | 514 |  |  |  | 529 |  |  |  | 506 |  |  |  | 488 |  
|General and administrative    |  |      | 87  |      |  |      | 91  |      |  |      | 92  |      |  |      | 93  |      |  |  | 103 |  |  |  | 94  |  |  |  | 94  |  |  |  | 90  |  
|Depreciation                  |  |      | 23  |      |  |      | 19  |      |  |      | 16  |      |  |      | 16  |      |  |  | 22  |  |  |  | 13  |  |  |  | 12  |  |  |  | 13  |  
|Other                         |  |      | 0   |      |  |      | 0   |      |  |      | 4   |      |  |      | (2  | )    |  |  | 0   |  |  |  | 3   |  |  |  | 1   |  |  |  | (1  | )
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|Total Expenses                |  |      | 634 |      |  |      | 629 |      |  |      | 636 |      |  |      | 608 |      |  |  | 639 |  |  |  | 639 |  |  |  | 613 |  |  |  | 590 |  
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  
|EBITDA1                       |  |      | 58  |      |  |      | 53  |      |  |      | 55  |      |  |      | 47  |      |  |  | 69  |  |  |  | 59  |  |  |  | 57  |  |  |  | 39  |  
|                              |  |      |     |      |  |      |     |      |  |      |     |      |  |      |     |      |  |  |     |  |  |  |     |  |  |  |     |  |  |  |     |  

29



---



##### 



FORWARD-LOOKING INFORMATION

This document contains certain forward-looking statements relating, but not
limited, to operations, anticipated financial performance, business prospects
and strategies of CP Ships. These statements can be found in the CEOs Letter
to Shareholders and Managements Discussion and Analysis. Forward-looking
information typically contains statements with words such as consider,
anticipate, believe, expect, plan or intend. Investors should be
aware that these statements are subject to known and unknown risks,
uncertainties and other factors that could cause actual results to differ
materially from those suggested by the forward-looking statements.

Investors are cautioned not to place undue reliance on forward-looking
information, which depends in part on factors which include, but are not
limited to, changes in business strategies; general global and economic and
business conditions, including the possibility of a weaker world economy; the
effects of competition and pricing pressures; industry over-capacity; changes
in demand for container shipping; cyclical nature of the industry; exceptional
increases in costs; changes in laws and regulations, including environmental,
employment, fiscal and regulatory laws; currency and interest rate
fluctuations; changes in access to capital markets and other sources of
financing; various events which could disrupt operations, including war, acts
of terrorism, severe weather conditions and external labour unrest; and CP
Ships anticipation of and success in managing the risks arising from the
foregoing.

CP Ships undertakes no obligation, except as required by law, to update or
otherwise revise any forward-looking information, whether as a result of new
information, future events or otherwise, or the list of factors affecting this
information.

30