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SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

FORM 40-F

[   ] Registration statement pursuant to section 12 of the Securities Exchange
Act of 1934

or

[X] Annual report pursuant to section 13(a) or 15(d) of the Securities Exchange
Act of 1934

For the fiscal year ended December 31, 2001
Commission file number 1-15228

CP SHIPS LIMITED
(Exact name of Registrant as specified in its charter)

|                                                                 |  |                                                          |  |                                                        
|---------------------------------------------------------------- |  | -------------------------------------------------------- |  | -------------------------------------------------------
|New Brunswick                                                    |  | 4012                                                     |  | 98-0357224                                             
|                                                                 |  |                                                          |  |                                                        
|(Province or other jurisdiction ofincorporation or organization) |  | (Primary Standard IndustrialClassification Code Numbers) |  | (I.R.S. Employer Identification Number
(if applicable))

62-65 Trafalgar Square
London WC2N 5DY
United Kingdom
+44 20 7389 1100
(Address and telephone number of Registrants principal executive offices)

J.P. LaCasse
CP Ships Americas
Suite 3300, 401 East Jackson Street,
Tampa, Florida 33602
1 813 276 2600
(Name, address (including zip code) and telephone number (including area code)
of agent for service in the United States)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

|                                 |  |                         |  | 
|-------------------------------- |  | ----------------------- |  | 
|                                 |  | Name of Each Exchange  
|Title of Class                   |  | On Which Registered    
|Common Shares, no par value      |  |                         |  | 
|Common
Share Purchase Rights (1) |  | New York Stock Exchange

(1)  Initially attached to and trade with the Common Shares.

Securities registered or to be registered pursuant to Section 12(g) of the Act:

None
(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

None
(Title of Class)

For annual reports, indicate by check mark the information filed with this Form:

|                            |  |                                        
|--------------------------- |  | ---------------------------------------
|[X] Annual Information Form |  | [X] Audited Annual Financial Statements



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##### Table of Contents



Indicate the number of outstanding shares of each of the issuers classes of
capital or common stock as of December 31, 2001:

79,969,095 Common Shares

Indicate by check mark whether the Registrant by filing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934
(the Exchange Act). If Yes is marked, indicate the filing number assigned
to the Registrant in connection with such Rule.

|    |  |     |  |      |  | 
|--- |  | --- |  | ---- |  | 
|Yes |  | 82- |  | No
X |  | 

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Exchange Act during the
preceding 12 months (or for such shorter period that the Registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.

Yes X     No

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EXHIBITS

The following documents are filed as exhibits to this Form 40-F:

|        |  |                                                                                                           | 
|------- |  | --------------------------------------------------------------------------------------------------------- | 
|Exhibit |  |                                                                                                           | 
|Number  |  | Document                                                                                                 
|       
|1.      |  | Management Discussion and Analysis for the year ended December 31, 2001.                                 
|       
|2.      |  | Audited Consolidated Financial Statements as at and for the years ended December 31, 2001, 2000 and 1999.
|       
|3.      |  | Consent of Auditors.                                                                                     

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UNDERTAKING

Registrant undertakes to make available, in person or by telephone,
representatives to respond to inquiries made by the Commission staff, and to
furnish promptly, when requested to do so by the Commission staff, information
relating to: the securities registered pursuant to Form 40-F; the securities in
relation to which the obligation to file an annual report on Form 40-F arises;
or transactions in said securities.

CONSENT TO SERVICE OF PROCESS

Concurrently with the filing of this annual report, the Registrant is filing
with the Commission a written irrevocable consent and power of attorney on Form
F-X.

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SIGNATURES

Pursuant to the requirements of the Exchange Act, the Registrant certifies that
it meets all of the requirements for filing on Form 40-F and has duly caused
this annual report to be signed on its behalf by the undersigned, thereto duly
authorized.

|                 |                                      
|---------------- | -------------------------------------
|CP SHIPS LIMITED
|                
|                
|                
|                
|By:              | /s/ Ian J. Webber                    
|                 |                                      
|                 | Ian J. Webber
Chief Financial Officer

Date: 28 May 2002

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CP Ships Logo

CP SHIPS LIMITED

2001 ANNUAL INFORMATION FORM

AS OF 17th MAY 2002



---

TABLE OF CONTENTS



|                                                                                      |  |  |  |  |  |  |  | 
|------------------------------------------------------------------------------------- |  |  |  |  |  |  |  | 
|FORWARD LOOKING INFORMATION                                                          
|CURRENCY EXCHANGE RATES                                                              
|CORPORATE STRUCTURE                                                                  
|GENERAL DEVELOPMENT OF THE BUSINESS                                                  
|NARRATIVE DESCRIPTION OF THE BUSINESS                                                
|SELECTED CONSOLIDATED FINANCIAL INFORMATION                                          
|SELECTED QUARTERLY FINANCIAL INFORMATION                                             
|MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|MARKET FOR SECURITIES                                                                
|DIVIDEND POLICY                                                                      
|DIRECTORS AND SENIOR OFFICERS                                                        
|ADDITIONAL INFORMATION                                                               
|Management Discussion and Analysis                                                   
|Audited Consolodate Financial Statements                                             
|Consent of Auditors                                                                  



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TABLE OF CONTENTS

|                                                                                      |  |  |    | 
|------------------------------------------------------------------------------------- |  |  | -- | 
|FORWARD LOOKING INFORMATION                                                           |  |  | 3  | 
|CURRENCY EXCHANGE RATES                                                               |  |  | 3  | 
|CORPORATE STRUCTURE                                                                   |  |  | 4  | 
|GENERAL DEVELOPMENT OF THE BUSINESS                                                   |  |  | 5  | 
|NARRATIVE DESCRIPTION OF THE BUSINESS                                                 |  |  | 6  | 
|SELECTED CONSOLIDATED FINANCIAL INFORMATION                                           |  |  | 30 | 
|SELECTED QUARTERLY FINANCIAL INFORMATION                                              |  |  | 31 | 
|MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS |  |  | 31 | 
|MARKET FOR SECURITIES                                                                 |  |  | 31 | 
|DIVIDEND POLICY                                                                       |  |  | 31 | 
|DIRECTORS AND SENIOR OFFICERS                                                         |  |  | 31 | 
|ADDITIONAL INFORMATION                                                                |  |  | 34 | 

2



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FORWARD LOOKING INFORMATION

This Annual Information Form contains certain forward-looking statements
within the meaning of the United States Private Securities Litigation Reform
Act of 1995 relating, but not limited, to operations, anticipated financial
performance, business prospects and strategies of CP Ships Limited (CP
Ships). Forward-looking information typically contains statements with words
such as anticipate, believe, expect, plan, intend or similar words
suggesting future outcomes or statements regarding an outlook on future changes
in freight rates, the estimated amounts and timing of capital expenditures,
anticipated future debt levels and incentive fees or revenue, or other
expectations, beliefs, plans, objectives, assumptions, intentions or statements
about future events or performance. Readers 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.

Readers are cautioned not to place undue reliance on forward-looking
information. By its nature, the forward-looking information of CP Ships
involves numerous assumptions, inherent risks and uncertainties, both general
and specific, that contribute to the possibility that the predictions,
forecasts, projections and other forward-looking statements will not occur.
These factors include, but are not limited to, changes in business strategies;
general global economic and business conditions, including the length and
severity of the current economic slowdown in the countries and regions where CP
Ships operates, particularly in the United States, Canada, Latin America,
Australasia and Europe; the effects of competition and pricing pressures;
industry over-capacity; changes in demand for container shipping; changes in
laws and regulations, including environmental, employment, competition and
trade laws; difficulties in implementing a cost savings program; currency and
interest rate fluctuations; changes in access to capital markets and other
sources of financing; various events which could disrupt operations, including
severe weather conditions and external labour unrest; and CP Ships
anticipation of and success in managing the risks associated with the
foregoing.

The above list of important factors is not exhaustive. CP Ships undertakes
no obligation, except as required by law, to update publicly or otherwise
revise any forward-looking information, whether as a result of new information,
future events or otherwise, or the above list of factors affecting this
information.




CURRENCY EXCHANGE RATES

Unless otherwise specified, the financial information relating to CP Ships
contained in this Annual Information Form are expressed in U.S. dollars.
Certain financial information relating to CP Ships contained in this Annual
Information Form originates in currencies other than U.S. dollars and has been
converted into U.S. dollars based on prevailing exchange rates, except for
financial information extracted from the consolidated financial statements of
CP Ships , other than for 1997, which has been translated in accordance with CP
Ships accounting policy contained in such statements. Such information for
1997 has been translated in accordance with Note 1 to the relevant table.

The following tables set out, for each period indicated, the high, low,
average and period end exchange rate for U.S. dollars expressed in Canadian
dollars based on the noon buying rate in New York City as certified by the New
York Federal Reserve Bank for customs purposes:

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|                                 |                              |                               |      |       |      |  |      |       |      |  |      |       |  |  |  |       |  |  |  |       | 
|-------------------------------- | ---------------------------- | ----------------------------- | ---- | ----- | ---- |  | ---- | ----- | ---- |  | ---- | ----- |  |  |  | ----- |  |  |  | ----- | 
|(in C$)                          |                              | 12 Months Ended 31st December
|                                 |                              |                               |     
|                                 |                              |                               | 2001 |       | 2000 |  | 1999 |       | 1998 |  | 1997
|                                 |                              |                               |      |       |      |  |      |       |      |  |     
|Canadian dollars per U.S. dollar |                              |                               |      |       |      |  |      |       |      |  |      |       |  |  |  |       |  |  |  |      
|                                 | High in the year             |                               |      | 1.602 |      |  |      | 1.560 |      |  |      | 1.530 |  |  |  | 1.577 |  |  |  | 1.440 | 
|                                 | Low in the year              |                               |      | 1.493 |      |  |      | 1.435 |      |  |      | 1.444 |  |  |  | 1.408 |  |  |  | 1.336 | 
|                                 | Rate at end of year          |                               |      | 1.593 |      |  |      | 1.500 |      |  |      | 1.444 |  |  |  | 1.538 |  |  |  | 1.429 | 
|                                 | Average rate for the year(1) |                               |      | 1.552 |      |  |      | 1.487 |      |  |      | 1.481 |  |  |  | 1.490 |  |  |  | 1.389 | 

|                                 |                      |      |       |       |       |  |          |       |         |  |  |       |  |  |  |       | 
|-------------------------------- | -------------------- | ---- | ----- | ----- | ----- |  | -------- | ----- | ------- |  |  | ----- |  |  |  | ----- | 
|(in C$)                          |                      | 2002
|                                 |                      |      |      
|                                 |                      |      | April |       | March |  | February |       | January
|                                 |                      |      |       |       |       |  |          |       |        
|Canadian dollars per U.S. dollar |                      |      |       |       |       |  |          |       |         |  |  |       |  |  |  |      
|                                 | High in the month    |      |       | 1.600 |       |  |          | 1.596 |         |  |  | 1.611 |  |  |  | 1.613 | 
|                                 | Low in the month     |      |       | 1.563 |       |  |          | 1.577 |         |  |  | 1.589 |  |  |  | 1.590 | 
|                                 | Rate at end of month |      |       | 1.568 |       |  |          | 1.596 |         |  |  | 1.065 |  |  |  | 1.592 | 



---

|(1) |  | The average of the exchange rate on the last day of each month during the
applicable period.
|--- |  | --------------------------------------------------------------------------------------------




CORPORATE STRUCTURE

CP Ships Limited is governed by the Business Corporations Act(New
Brunswick). The registered office of CP Ships is Brunswick House, 44 Chipman
Hill, Saint John, New Brunswick, Canada E2L 4Z6. The head office of CP Ships is
located at 62-65 Trafalgar Square, London, WC2N 5DY, United Kingdom and its
telephone number is +44-20-7389-1100.

The diagram below illustrates the corporate structure of CP Ships
including its principal subsidiaries, all of which are wholly owned, directly
or indirectly, and their jurisdiction of incorporation. Certain subsidiaries
of CP Ships, which are not material to its business, have not been included in
this chart.

Corporate Structure Chart

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GENERAL DEVELOPMENT OF THE BUSINESS

On 1st October 2001, CP Ships former parent, Canadian Pacific Limited
(CPL) reorganized and divided into five separate companies (the Spin-off).
As a result, CP Ships became an independent publicly listed company on the
Toronto Stock Exchange and the New York Stock Exchange on 3rd October 2001.
However, CP Ships maritime roots date back to 1886 when CPL established a
marine service to Asia to generate volume for the Pacific terminal of its newly
completed trans-Canada railway. CPL began operating a shipping business on the
Atlantic in 1903. In 1968, CPL reorganized its North Atlantic shipping
operations to concentrate on container services and, in 1984, co-founded Canada
Maritime whose minority interest it acquired in 1993.

Since 1993, CP Ships has grown substantially both through organic growth
and through strategic acquisitions where it has established a record of
successfully improving the operations and the profitability of acquired
companies. CP Ships focuses on maintaining and improving results of acquired
businesses by increasing volumes, enhancing operating efficiencies, reducing
costs, improving the organization and building brand strength.

Significant Acquisitions

Since 1993, CP Ships has successfully completed the nine transactions
listed below. The remarks include the condition of each business at the time of
acquisition. Other than Ivaran Lines and CCAL, which have been merged into
Lykes Lines, each of the other acquired businesses continues as a significant
brand in CP Ships current operations.

|     |  |                         |  |                                  
|---- |  | ----------------------- |  | ---------------------------------
|Year |  | Acquisition             |  | Remarks                          
|     |  |                         |  |                                  
|1993 |  | Canada Maritime         |  | Purchase of 43% minority         
|1995 |  | Cast                    |  | Bankrupt                         
|1997 |  | Lykes Lines             |  | Bankrupt                         
|1997 |  | Contship Containerlines |  | Profitable                       
|1998 |  | Ivaran Lines            |  | Unprofitable                     
|1998 |  | ANZDL                   |  | Profitable                       
|1999 |  | TMM Lines               |  | Unprofitable; 50/50 joint venture
|2000 |  | TMM Lines               |  | Acquired the remaining 50%       
|2000 |  | CCAL                    |  | Small                            

In January 1993, CP Ships acquired the remaining 43% minority interest in
Canada Maritime which it did not already own. This acquisition permitted CP
Ships to plan more effectively as the sole shareholder of Canada Maritime.

In April 1995, CP Ships acquired Cast out of a bankruptcy proceeding. A
new management team was appointed and Casts service offering and organization
were revitalized. Both Canada Maritime and Cast operate services on the
TransAtlantic market between Europe and Montreal, serving the U.S./Canada
market.

CP Ships acquired Lykes Lines in July 1997, also out of bankruptcy. This
acquisition extended CP Ships TransAtlantic coverage to the U.S. East and Gulf
Coasts. The same management team that had revitalized Cast restructured Lykes
Lines services, repositioned its marketing strategy, reorganized the
management structure and implemented cost reduction programs.

The acquisition of Contship Containerlines in October 1997 provided CP
Ships with a platform to enter other markets, principally Australasia. Contship
Containerlines Gulf-Mediterranean service

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complemented Lykes Lines service in that trade lane. Contship Containerlines
also operates the Ocean Star Round-the-World Service.

Ivaran, which was acquired in May 1998, extended CP Ships coverage to the
U.S. East Coast and Gulf Coast-South America trade lanes. This acquisition
permitted CP Ships to secure trade lane economies of scale and cost synergies.
The Ivaran brand name was replaced by Lykes Lines in 2000.

In December 1998, CP Ships acquired ANZDL, the market leader in the U.S.
West Coast-Australasia trade lane. ANZDL also offered CP Ships improved
economies of scale and operating and cost synergies in the Australasian market.

In January 1999, CP Ships formed the Americana Ships joint venture with
Transportación Maritima Mexicana SA de CV (TMMsa) in order to create a strong
regional competitor in the U.S. Gulf, Mexico, Central and South American trade
lanes. The 50/50 joint venture combined CP Ships services in this region,
Lykes Lines and Ivaran Lines, with TMM Lines, the container shipping business
of TMMsa. Effective 1st January 2000, CP Ships acquired TMMsas 50% interest in
the Americana Ships joint venture.

In August 2000, CP Ships purchased Christensen Canadian African Lines
(CCAL), which provides services between Montreal and the U.S. East Coast and
South Africa, building on Lykes Lines position in the South Africa trade lane.
CCAL now operates under the Lykes Lines brand name.




NARRATIVE DESCRIPTION OF THE BUSINESS

Overview

CP Ships is one of the worlds leading container shipping companies,
offering its customers door-to-door as well as port-to-port containerized
services for the international transportation of a broad range of industrial
and consumer goods, including raw materials, semi-manufactured and finished
goods. CP Ships operates a fleet of 78 ships in 24 trade lanes focusing on four
principal markets. In 2001, it transported over 1.8 million twenty-foot
equivalent units, or teu, on behalf of more than 30,000 customers. Based on
standing capacity, CP Ships ranks as the eleventh largest carrier in the world,
giving it the economies of scale available to global carriers. In 2001, it had
revenue of $2.65 billion and EBITDA of $213 million before exceptional charges
of $36 million related to the Spin-off and the restructuring of organization
and offices.

CP Ships is a regional specialist that offers direct services to a wider
range of ports within a particular market than are generally offered by global
carriers. This approach allows CP Ships, to provide customers with the local
expertise and market presence of a regional specialist combined with many of
the operating advantages of a global carrier. CP Ships provides scheduled
services in its four principal markets: TransAtlantic, Australasia, Latin
America and Asia, which it serves through six well-recognized brands: Canada
Maritime, Cast, Contship Containerlines, ANZDL, Lykes Lines and TMM Lines.

CP Ships operates in an industry whose annual volume growth has on average
exceeded global gross domestic product growth by two to three times over the
last 20 years. Since its introduction in the 1950s, the container shipping
industry has facilitated world trade because of its simplicity, efficiency and
low cost, becoming an integral part of the global sourcing strategies for many
of the worlds major manufacturers and retailers.

Over the last six years, CP Ships considers it has outperformed, on the
basis of return on capital employed (ROCE), in both weak as well as strong
market conditions, the average ROCE of those

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carriers in the top 20 for which data is publicly available based on its
competitive strengths and strategy which are discussed below.

As a result of the successful integration of its acquisitions and through
organic growth, CP Ships has achieved a global scale of operations, diversified
its markets and established itself as a market leader.

Competitive Strengths

CP Ships believes it has the following strengths which allow it to compete
successfully:

Leading market position.CP Ships believes it is the largest carrier based
on market share in a majority of its 16 core trade lanes. This leading market
position has been achieved by focusing on customers and customer service
through its well-recognized and highly-regarded brands.

Regional focus.CP Ships regional focus provides more reliable and
frequent service schedules, flexible and timely response to changes in local
market conditions, the ability to offer customized services, greater trade lane
economies of scale and premium pricing for its services. These provide it with
a measure of protection from new competitors on its core trade lanes.

Low cost operator.A combination of global scale economies and trade lane
scale economies based on strong market position has allowed CP Ships to reduce
its costs significantly. Savings in ship networks, terminals and stevedoring,
container fleet, inland transport and administration have contributed to a 15%
reduction in costs per teu from $1,495 in 1996 to $1,271 in 2001. In addition,
CP Ships expects to realize in 2002 the full effect of cost reduction
initiatives which started in 2001. CP Ships also expects further benefits from
operational cost cutting and organizational changes undertaken in 2002,
including the renewal in the first quarter of 13 ship charters at significantly
lower rates which CP Ships anticipates will generate savings of nearly $25
million in the year.

Successful track record of acquisitions.CP Ships has completed nine
transactions since 1993, often involving the turn-around of underperforming
businesses. It has successfully integrated those businesses, improving both
service and profitability. These acquisitions have contributed to a compound
annual growth of revenue of 31% and a compound annual increase in operating
income of 12% since 1994.

Diversified customer base.CP Ships has over 30,000 customers that are
diversified both by geography and by industry. Its largest customer represented
approximately 1% of its revenue in 2001, and its top ten customers accounted
for only 6%. This diversity protects it against the adverse effect of relying
on a single customer or industry.

Experienced management team.The members of the senior management team
average over 24 years experience in the container shipping industry. The large
majority of the management team has worked for CP Ships for many years,
including with its original core business or acquired businesses. Incentives
are provided to senior management through share based compensation and to all
staff including senior management through cash incentives based on operating
income.

Strategy

Six principal strategies underpin CP Ships business model, which has
delivered ROCE well above industry averages over many years.

Concentration on container shipping.CP Ships concentrates exclusively on
container shipping services which allows management to plan for and quickly
respond to often rapidly changing economic, political and trade conditions in
what is a truly international business.

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Focus on regional markets.CP Ships has built strong positions in a number
of regional markets. It is the leading carrier in the majority of its core
trade lanes, which allows it to offer the best schedules and services to its
customers and to maximize trade lane economies of scale.

Acquisitions.Nine transactions have been executed successfully in the
last nine years, often involving the turnaround of under-performing businesses.
CP Ships revenue is now over six times larger than in 1994. In a relatively
fragmented industry under economic pressure, there will likely be further
acquisition opportunities. CP Ships expects to continue to pursue a disciplined
acquisition strategy that enables it to grow either in its existing markets or
expand into new markets, thereby helping to achieve further economies of scale
that improve operating performance.

Strong brands.CP Ships offers two or more of its well-recognized brands
in nearly all of its trade lanes. It intends to strengthen its brands by
continuing to respond to the evolving needs of its customers by selectively
expanding its services, improving service frequencies and transit times,
improving the efficiency of its inland transportation networks and implementing
effective training and staff retention programs. CP Ships considers that its
multiple branding approach results in higher levels of service which strengthen
market share and customer loyalty.

Supply chain solutions.Integrated door-to-door or intermodal container
transportation is the largest component in the logistics supply chains of
international trade. CP Ships continues to emphasize consistently reliable,
tailor-made intermodal supply chain solutions for its customers to strengthen
customer relationships and protect operating margins.

Reduce costs.Delivering low-cost, high-quality service is a key to
success in the highly competitive container shipping industry. CP Ships has
reduced cost per teu by 15% from 1996 to 2001 and, in 2002, plans additional
cost savings through continued rationalization of ship schedules,
organizational changes, other operational savings and the renewal of ship
charters at lower rates.

Service

CP Ships provides port-to-port and door-to-door ocean container shipping
services with 30 sailings every week covering more than 140 ports on six
continents. It emphasizes the provision of door-to-door services to its
customers. A typical shipment generally involves the following steps:



| |  |  | A customer makes a booking at a price and on other terms
which usually have been agreed previously or determined under
contract.                                                                                                                           
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The customer service department checks the existing customer
profile and updates equipment, scheduling and transport
requirements.                                                                                                                         
|
| |  |  | CP Ships arranges for an inland transport provider to
position an empty container at the customers (exporting) plant or
warehouse at an agreed time.                                                                                                      
|
| |  |  | Once the container is filled, nominated inland transport
operator picks up and moves the container by truck, rail, barge,
feeder ship, or combination thereof, from the customers loading
point to a marine terminal in time to meet a particular sailing.
|
| |  |  | The container is received by the marine terminal and is
loaded directly into a predetermined slot in the ship using
specialist cranes or is stored at the terminal until loaded onto its
scheduled ship.                                                   

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| |  |  | The ship sails at a fixed time according to a pre-set
schedule on fixed day of the week sailings.                                                                                                                                                                                                                                                                                                                 
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The container is discharged at the marine terminal in the
destination port, again according to the pre-set schedule.
Just-in-time shipments and containers moving in high-density
corridors move directly from ship to rail or truck, subject to
satisfying the requirements of local customs. Otherwise, containers
are stored at the arrival terminal for customs clearance and
arrangement of inland transport.
|
| |  |  | Delivery of a full container to a customers (importing)
premises is co-ordinated with an inland transport provider.                                                                                                                                                                                                                                                                                              
|
| |  |  | After unloading the cargo at the importers plant or
warehouse, the empty container moves directly to an exporters
warehouse for reloading or to a depot to await future use.                                                                                                                                                                                                                                    

Markets and Trade Lanes

CP Ships operates in the following trade lanes of its principal markets
under the following brand names:

|                 |  |                                            |  |                                                
|---------------- |  | ------------------------------------------ |  | -----------------------------------------------
|Principal Market |  | Trade Lanes                                |  | Brands                                         
|                 |  |                                            |  |                                                
|TransAtlantic    |  | US/Canada via Montreal-North Europe        |  | Canada Maritime, Cast                          
|                 |  | US/Canada via Montreal-Mediterranean       |  | Canada Maritime, Cast                          
|                 |  | West Coast North America-Mediterranean     |  | Lykes Lines, TMM Lines,
Contship Containerlines
|                 |  | US East Coast/ North Europe                |  | Lykes Lines, TMM Lines                         
|                 |  | Gulf-North Europe                          |  | Lykes Lines, TMM Lines                         
|                 |  | Gulf-Mediterranean                         |  | Lykes Lines, TMM Lines,
Contship Containerlines
|Australasian     |  | Europe-Australasia                         |  | Contship Containerlines                        
|                 |  | Ocean Star Round-the-World                 |  | Contship Containerlines                        
|                 |  | US West Coast-Australasia                  |  | ANZDL, Contship
Containerlines                 
|                 |  | TransTasman                                |  | ANZDL, Contship
Containerlines                 
|Latin American   |  | North Europe-East Coast South America      |  | Contship Containerlines, Lykes
Lines           
|                 |  | Mediterranean-East Coast South America     |  | Contship Containerlines, Lykes
Lines           
|                 |  | U.S. East Coast-East Coast South America   |  | Lykes Lines, TMM Lines                         
|                 |  | Gulf-East Coast South America              |  | Lykes Lines, TMM Lines                         
|                 |  | Gulf-Caribbean                             |  | Lykes Lines, TMM Lines                         
|Asian            |  | Asia-Americas                              |  | Lykes Lines, TMM Lines                         
|                 |  | Asia-South Africa-East Coast South America |  | Lykes Lines, TMM Lines                         
|                 |  | Asia-North Europe                          |  | Contship Containerlines, Lykes
Lines           
|                 |  | Asia-Mediterranean                         |  | Contship Containerlines, Lykes
Lines           
|                 |  | Europe-India/Pakistan                      |  | Contship Containerlines                        

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|                 |  |                                    |  |                                     
|---------------- |  | ---------------------------------- |  | ------------------------------------
|Principal Market |  | Trade Lanes                        |  | Brands                              
|                 |  |                                    |  |                                     
|                 |  | US East Coast-India                |  | Contship Containerlines, Lykes
Lines
|                 |  | South East Asia-India/Arabian Gulf |  | Contship Containerlines             

In addition to its four main markets, CP Ships also operates in the North
America-South Africa trade lane under the Lykes Lines brand and operates a
small break-bulk service between Asia-Latin America-Caribbean under the Lykes
Lines and TMM Lines brands.

The following tables illustrate teu volume and revenue for CP Ships
principal markets for the last three years. Percentages of total are shown for
both volume and revenue for 2001.

Volume Per Market

|               |  |            |       |       |  |            |     |            |  |      |       |  |  |  |       | 
|-------------- |  | ---------- | ----- | ----- |  | ---------- | --- | ---------- |  | ---- | ----- |  |  |  | ----- | 
|               |  | 2001       |       |       |  |            |     | 2000       |  | 1999
|Principal      |  | Volume     |       | % of  |  | Volume     |     | Volume    
|Market         |  | (teu 000s) |       | Total |  | (teu 000s) |     | (teu 000s)
|               |  |            |       |       |  |            |     |           
|TransAtlantic  |  |            | 942   |       |  |            | 51  |            |  |      | 1,033 |  |  |  | 732   | 
|Australasian   |  |            | 348   |       |  |            | 19  |            |  |      | 356   |  |  |  | 340   | 
|Latin American |  |            | 162   |       |  |            | 9   |            |  |      | 177   |  |  |  | 117   | 
|Asian          |  |            | 331   |       |  |            | 18  |            |  |      | 216   |  |  |  | 110   | 
|Other          |  |            | 59    |       |  |            | 3   |            |  |      | 51    |  |  |  | 74    | 
|               |  |            |       |       |  |            |     |            |  |      |       |  |  |  |       | 
|Total          |  |            | 1,842 |       |  |            | 100 |            |  |      | 1,833 |  |  |  | 1,373 | 
|               |  |            |       |       |  |            |     |            |  |      |       |  |  |  |       | 

Revenue Per Market

|               |  |              |       |            |  |              |     |              |  |         |       |  |  |  |       | 
|-------------- |  | ------------ | ----- | ---------- |  | ------------ | --- | ------------ |  | ------- | ----- |  |  |  | ----- | 
|               |  | 2001         |       |            |  |              |     | 2000         |  | 1999   
|Principal      |  | Revenue      |       |            |  |              |     | Revenue      |  | Revenue
|Market         |  | ($ millions) |       | % of Total |  | ($ millions) |     | ($ millions)
|               |  |              |       |            |  |              |     |             
|TransAtlantic  |  |              | 1,323 |            |  |              | 50  |              |  |         | 1,406 |  |  |  | 977   | 
|Australasian   |  |              | 549   |            |  |              | 21  |              |  |         | 574   |  |  |  | 547   | 
|Latin American |  |              | 244   |            |  |              | 9   |              |  |         | 242   |  |  |  | 137   | 
|Asian          |  |              | 435   |            |  |              | 16  |              |  |         | 337   |  |  |  | 154   | 
|Other          |  |              | 95    |            |  |              | 4   |              |  |         | 86    |  |  |  | 63    | 
|               |  |              |       |            |  |              |     |              |  |         |       |  |  |  |       | 
|Total          |  |              | 2,646 |            |  |              | 100 |              |  |         | 2,645 |  |  |  | 1,878 | 
|               |  |              |       |            |  |              |     |              |  |         |       |  |  |  |       | 

TransAtlantic Market

In 2001, 51% of CP Ships volume was in the TransAtlantic market, where it
provided services under the Canada Maritime, Cast, Contship Containerlines,
Lykes Lines and TMM Lines brands. CP Ships offers 12 services on the
TransAtlantic, of which 10 are fixed-day weekly sailings, providing the most
comprehensive service network in the market. Through efficient links to an
extensive inland transportation network in North America, Mexico and Europe, CP
Ships provides its customers with the choice of seamless door-to-door services
as well as port-to-port service options.

Within the TransAtlantic market, CP Ships is the leader in the US/Canada
via Montreal-North Europe and US/Canada via Montreal-Mediterranean trade lanes
with five weekly services, using a fleet of owned ice-strengthened container
ships which are designed to operate throughout the year. The Montreal gateway

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provides a more direct route to Canada and the U.S. Midwest and accesses a more
cost effective Canadian infrastructure, including CP Ships operated terminals
in Montreal and Canadian Pacific Railways rail network.

CP Ships Gulf trade lanes serve U.S. and Mexican ports in the Gulf of
Mexico with four weekly services. Its regional focus on the Gulf within the
TransAtlantic market and market share are strengthened by the strong brand
recognition of Lykes Lines in the U.S. Gulf and by its reputation as the
leading carrier in Mexico through TMM Lines.

CP Ships also operates two weekly services in the US East Coast-North
Europe trade lane and an every 10-days service in the West Coast North
America-Mediterranean trade lane.

|                                        |  |          |   |               |  |           |              |        |  |             |  |                                                
|--------------------------------------- |  | -------- | - | ------------- |  | --------- | ------------ | ------ |  | ----------- |  | -----------------------------------------------
|Trade Lanes                             |  | Services |   | Company Ships |  | Frequency |              | Brands
|                                        |  |          |   |               |  |           |              |       
|US/Canada via Montreal-
North Europe    |  |          | 3 |               |  |           | 7            |        |  | 3 x weekly  |  | Canada Maritime, Cast                          
|                                       
|US/Canada via Montreal-
Mediterranean   |  |          | 2 |               |  |           | 6            |        |  | 2 x weekly  |  | Canada Maritime, Cast                          
|                                       
|West Coast North America-
Mediterranean |  |          | 1 |               |  |           | Slot charter |        |  | 1 x 10 days |  | Lykes Lines, TMM Lines,
Contship Containerlines
|                                       
|US East Coast-North Europe              |  |          | 2 |               |  |           | 1            |        |  | 2 x weekly  |  | Lykes Lines, TMM Lines                         
|                                       
|Gulf-North Europe                       |  |          | 3 |               |  |           | 8            |        |  | 3 x weekly  |  | Lykes Lines, TMM Lines                         
|                                       
|Gulf-Mediterranean                      |  |          | 1 |               |  |           | 4            |        |  | 1 x 9 days  |  | Lykes Lines, TMM Lines,
Contship Containerlines

CP Ships believes that its extensive low cost service network, regional
multi-brand focus, door-to-door capabilities, and significant volume and trade
lane economies of scale strengthen its position as the leading carrier in the
TransAtlantic market.

Australasian Market

CP Ships operates eight services in four trade lanes in the Australasian
market through the Contship Containerlines and ANZDL brands. The Australasian
market accounted for 19% of CP Ships volume in 2001. CP Ships is a leader in
its Australasian trade lanes.

In the Europe-Australasia trade lane, CP Ships operates three services
under the Contship Containerlines brand. Schedules for the two services
operating between North Europe and Australasia are co-ordinated with the
Mediterranean bi-weekly service to provide weekly service in both areas. In
addition, the Ocean Star Round-the-World Service links a number of regional
markets with a primary focus on the Australasia and Pacific Island areas. CP
Ships intends to restructure and rationalize these four services with partners
by the end of 2002.

In the US West Coast-Australasia trade lane, two weekly services are
operated. In addition, a service is operated every nine days between the U.S.
East Coast and Australasia as part of the Ocean Star Round-the-World service.
CP Ships also operates two services in the TransTasman trade lane under the
ANZDL and Contship Containerlines brands. One service operates two ships and
the other operates on a slot charter basis. In addition, a number of CP Ships
other mainline services also serve the TransTasman trade lane.

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|                           |  |          |   |               |  |           |   |        |  |                                                         |  |                               
|-------------------------- |  | -------- | - | ------------- |  | --------- | - | ------ |  | ------------------------------------------------------- |  | ------------------------------
|Trade Lanes                |  | Services |   | Company Ships |  | Frequency |   | Brands
|                           |  |          |   |               |  |           |   |       
|Europe-Australasia         |  |          | 3 |               |  |           | 6 |        |  | 3 x 14 days                                             |  | Contship Containerlines       
|                          
|Ocean Star Round-the-World |  |          | 1 |               |  |           | 4 |        |  | 1 x 10 days                                             |  | Contship Containerlines       
|                          
|US West Coast-Australasia  |  |          | 2 |               |  |           | 7 |        |  | 2 x weekly                                              |  | ANZDL, Contship
Containerlines
|                          
|TransTasman                |  |          | 2 |               |  |           | 2 |        |  | 1 x 12 days
1 x 6 days (plus
various mainline
services) |  | ANZDL, Contship
Containerlines

Latin American Market

The Latin American market accounted for 9% of CP Ships shipping volume in
2001. CP Ships operates six services in five trade lanes in the Latin American
market. The North American services are marketed under the Lykes Lines and TMM
Lines brands and the European services under the Lykes Lines and Contship
Containerlines brands. Lykes Lines and TMM Lines also market services in the
Asia-Americas trade lanes (which are discussed in Asian Market below) as well
as the Gulf-North Europe and Gulf-Mediterranean services included in the
TransAtlantic market, all of which call at Mexican ports.

|                                       |  |          |   |               |  |           |              |        |  |            |  |                                     
|-------------------------------------- |  | -------- | - | ------------- |  | --------- | ------------ | ------ |  | ---------- |  | ------------------------------------
|Trade Lanes                            |  | Services |   | Company Ships |  | Frequency |              | Brands
|                                       |  |          |   |               |  |           |              |       
|North Europe-East Coast
South America  |  |          | 1 |               |  |           | 1            |        |  | 1 x weekly |  | Contship Containerlines,
Lykes Lines
|                                      
|Mediterranean-East Coast
South America |  |          | 1 |               |  |           | Slot charter |        |  | 1 x 9 days |  | Contship Containerlines,
Lykes Lines
|                                      
|US East Coast-East Coast
South America |  |          | 2 |               |  |           | Slot charter |        |  | 2 x weekly |  | Lykes Lines, TMM Lines              
|                                      
|Gulf-East Coast South
America          |  |          | 1 |               |  |           | 4            |        |  | 1 x weekly |  | Lykes Lines, TMM Lines              
|                                      
|Gulf-Caribbean                         |  |          | 1 |               |  |           | 3            |        |  | 1 x weekly |  | Lykes Lines, TMM Lines              

Asian Market

The Asian market accounted for 18% of CP Ships volume in 2001. Its
presence in Asia was established with the acquisition of Contship
Containerlines in 1997 and has expanded with the formation of the Americana
Ships joint venture in January 1999 and the entry into the Asia-Europe trade
lanes by a substantial slot charter in March 2001. At present CP Ships operates
nine services in seven trade lanes.

CP Ships operates two services in the Asia-Americas trade lane. One
service operates between Asia and the West Coast North America and Mexico, and
the other between Asia and the West Coast North America, Mexico and West Coast
South America. Since March 2001, it has expanded its operations in Asia by
entering in the Asia-North Europe and Asia-Mediterranean trade lanes through
slot charter agreements with CMA-CGM, which will expire in March 2003. These
agreements, which provide CP Ships with an option to contribute ships in the
future, build upon its existing presence in these trade lanes through the
Westbound return legs of the Europe-Australia and Ocean Star Round-the-World
services and its established marketing organizations in Europe and Asia.

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|                                           |  |          |   |               |  |           |              |        |  |                           |  |                                     
|------------------------------------------ |  | -------- | - | ------------- |  | --------- | ------------ | ------ |  | ------------------------- |  | ------------------------------------
|Trade Lanes                                |  | Services |   | Company Ships |  | Frequency |              | Brands
|                                           |  |          |   |               |  |           |              |       
|Asia-Americas                              |  |          | 2 |               |  |           | 8            |        |  | 2 x weekly                |  | Lykes Lines, TMM Lines              
|                                          
|Asia-South Africa-East Coast
South America |  |          | 1 |               |  |           | Slot charter |        |  | 1 x weekly                |  | Lykes Lines, TMM Lines              
|                                          
|Asia-North Europe                          |  |          | 2 |               |  |           | Slot charter |        |  | 2 x weekly
1 x 14 days(1) |  | Contship Containerlines,
Lykes Lines
|                                          
|Asia-Mediterranean                         |  |          | 1 |               |  |           | Slot charter |        |  | 1 x weekly
1 x 14 days(1) |  | Contship Containerlines,
Lykes Lines
|                                          
|Europe-India/Pakistan                      |  |          | 1 |               |  |           | 2            |        |  | 1 x weekly                |  | Contship Containerlines             
|                                          
|US East Coast-India                        |  |          | 1 |               |  |           | 4            |        |  | 1 x weekly                |  | Contship Containerlines,
Lykes Lines
|                                          
|South East Asia-India/Arabian
Gulf         |  |          | 1 |               |  |           | Slot charter |        |  | 1 x weekly                |  | Contship Containerlines             



---

|(1) |  | Two of the Europe  Australasia services call at South East Asian ports en
route to North Europe and the Mediterranean but Westbound only.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------

Other Markets

Other markets comprised approximately 3% of CP Ships 2001 volumes. Lykes
Lines operates a roll-on roll-off (Ro Ro) service between North America and
South Africa. Ro Ro ships are designed to handle cargo that is driven on and
off the ship, as well as containers that are lifted by cranes on or off the
ship. CP Ships also operates an Asia-West Coast Latin America-Caribbean
break-bulk service. Other markets activities also include the two terminals in
Montreal that CP Ships operates for Canada Maritime and Cast and their service
partners, together with sub-chartering out of ships that are temporarily
surplus to its needs.

|                           |  |          |   |               |  |           |   |        |  |             |  |                       
|-------------------------- |  | -------- | - | ------------- |  | --------- | - | ------ |  | ----------- |  | ----------------------
|Trade Lanes                |  | Services |   | Company Ships |  | Frequency |   | Brands
|                           |  |          |   |               |  |           |   |       
|North America-South Africa |  |          | 1 |               |  |           | 4 |        |  | 1 x 20 days |  | Lykes Lines           
|                          
|Break-bulk service         |  |          | 1 |               |  |           | 2 |        |  | 1 x 30 days |  | Lykes Lines, TMM Lines

Joint Service Agreements

In nearly all of its trade lanes, CP Ships participates in joint services
with other container shipping companies either by contributing ships to a joint
service agreement or by entering into slot charters. It generally prefers to
contribute owned or chartered ships into a joint service agreement where the
economic benefits justify the capital investment. By operating its own ships
within a joint service, CP Ships believes it is better able to influence
important decisions regarding investment in ship and schedule improvements,
including number, size, and quality of ships deployed, sailing frequency, port
calls and port rotations. It also believes that lower costs can be achieved by
operating its own ships compared to chartering space from other carriers.

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The following outlines selected joint service agreements to which CP Ships
is a party:



| |  |  | US East Coast-North Europe and Gulf-North Europe trade lanes:
Since October 2000, CP Ships under the Lykes Lines and TMM Lines
brands has been operating three joint weekly services in the US East
Coast-North Europe trade lane and three joint weekly services in the
Gulf-North Europe trade lane with the Grand Alliance, whose partners
in the TransAtlantic trade lane are P&O Nedlloyd, Nippon Yusen
Kaisha, Orient Overseas Container Line (OOCL), and Hapag Lloyd. CP
Ships contributes nine of the 31 ships deployed in this arrangement.
In April 2002, CP Ships and its partners entered into an agreement
with Cosco, K Line and Yang Ming to form a new joint service called
the Atlantic Space Charter Agreement. As a result, one weekly string
of five 2000 teu capacity ships will be withdrawn from the trade
lane by Cosco, K Line and Yang Ming. Subject to regulatory approval,
this new agreement should be operational during the second quarter
2002. This new joint service agreement is expected to reduce
capacity primarily in the Gulf-North Europe trade lane, improve
transit times, extend the range and frequency of port calls and
reduce costs for CP Ships.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | Europe-Australasia trade lane: CP Ships in partnership with
P&O Nedlloyd operates three separate services under the Contship
Containerlines brand. CP Ships provides six out of the 17 ships
deployed. The three services are co-ordinated to provide fixed-day
weekly service in both North Europe and Mediterranean markets. The
services were established in January 1994 and are scheduled to
continue in their present form until November 2002 when they will be
replaced with a new comprehensive long term arrangement involving
restructured services for which new ships have been ordered by both
parties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |  |  | Asia-Americas trade lane: CP Ships operates two fixed-day
weekly services under the Lykes Lines and TMM Lines brands. One
service is operated between Asia and U.S. West Coast/Mexico under a
long term co-operation agreement with APL using six ships, four of
which are provided by CP Ships.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| |  |  | Ocean Star Round-the-World Service: Through Contship
Containerlines, CP Ships operates the Ocean Star Round-the-World
Service, a westbound service in partnership with CMA-CGM and
Marfret. The service operates with nine ships and calls at ports in
Europe, US East Coast, Jamaica, Panama (Panama Canal  transit),
Tahiti, Fiji, New Zealand, New Caledonia, Australia, South-East Asia
and back to the Mediterranean and North Europe via the Suez Canal.
CP Ships provides four ships and sub-charters two of the remaining
five ships, one to CMA-CGM and one to Marfret. CMA-CGM provides the
other three ships. This arrangement started in 1997 and is to be
restructured in conjunction with the services in the
Europe-Australasia trade lane.                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| |  |  | US/Canada via Montreal-North Europe trade lane: CP Ships
operates two services in partnership with OOCL under the St.
Lawrence Co-ordinated Service which was established in 1981. The
current agreement has recently been extended until 2015, as part of
an agreement by both parties to order three new ships in total.
Canada Maritime provides four ships and OOCL provides two ships.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

CP Ships generally charters space when it enters a new trade lane, if the
anticipated economic benefits of deploying its own ships do not justify the
size or risk of the investment or where CP Ships volumes in that particular
trade lane are likely to be initially small. CP Ships regularly evaluates the
potential for deploying its own ships in growing or new markets.

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CP Ships has restructured and rationalized its operations in many trade
lanes, most frequently by combining with other carriers a larger number of
independent services into jointly operated services. These rationalized
operations enhance service on the trade lanes by increasing frequency,
expanding port calls, improving reliability and reducing costs.

Operations

Ships

The following table lists the 78 ships owned and chartered by CP Ships as
at 31st March 2002:

|                     |  |       |      |             |  |                                      |  |              |      |         |  |          |  |      |    |         |  |       |  |  |  |  |  | 
|-------------------- |  | ----- | ---- | ----------- |  | ------------------------------------ |  | ------------ | ---- | ------- |  | -------- |  | ---- | -- | ------- |  | ----- |  |  |  |  |  | 
|                     |  |       |      |             |  |                                      |  |              |      |         |  |          |  |      |    |         |  | Max.  |  |  |  | 
|                     |  |       |      |             |  |                                      |  |              |      | Nominal |  |          |  |      |    | Service |  |       |  | 
|                     |  | Year  |      |             |  |                                      |  | Capacity(1)  |      | Owned/  |  | Speed    |  | Ship
|Ship                 |  | Built |      | Trade Lanes |  | (teu)                                |  | Chartered(2) |      | (knots) |  | Types(3)
|                     |  |       |      |             |  |                                      |  |              |      |         |  |         
|                    
|TransAtlantic        |  |       |      |             |  |                                      |  |              |      |         |  |          |  |      |    |         |  |       |  |  |  |  |  | 
|                    
|Canmar Honour        |  |       | 1998 |             |  | US/Canada via Montreal-North Europe  |  |              | 2800 |         |  | Bareboat |  |      | 22 |         |  | U    
|Canmar Pride         |  |       | 1998 |             |  | US/Canada via Montreal-North Europe  |  |              | 2800 |         |  | Bareboat |  |      | 22 |         |  | U    
|Canmar Courage       |  |       | 1996 |             |  | US/Canada via Montreal-North Europe  |  |              | 2300 |         |  | Bareboat |  |      | 20 |         |  | U    
|Canmar Fortune       |  |       | 1995 |             |  | US/Canada via Montreal-North Europe  |  |              | 2300 |         |  | Bareboat |  |      | 20 |         |  | U    
|Cast Performance     |  |       | 1983 |             |  | US/Canada via Montreal-North Europe  |  |              | 1900 |         |  | Owned    |  |      | 20 |         |  | U    
|Cast Power           |  |       | 1983 |             |  | US/Canada via Montreal-North Europe  |  |              | 1900 |         |  | Owned    |  |      | 20 |         |  | U    
|Cast Progress        |  |       | 1986 |             |  | US/Canada via Montreal-North Europe  |  |              | 2900 |         |  | Owned    |  |      | 21 |         |  | U    
|Canmar Trader        |  |       | 1991 |             |  | US/Canada via Montreal-Mediterranean |  |              | 1900 |         |  | STC      |  |      | 19 |         |  | U    
|Canmar Valour        |  |       | 1979 |             |  | US/Canada via Montreal-Mediterranean |  |              | 1000 |         |  | Owned    |  |      | 19 |         |  | U    
|Canmar Glory         |  |       | 1979 |             |  | US/Canada via Montreal-Mediterranean |  |              | 1000 |         |  | Owned    |  |      | 19 |         |  | U    
|Canmar Triumph       |  |       | 1978 |             |  | US/Canada via Montreal-Mediterranean |  |              | 1000 |         |  | Owned    |  |      | 19 |         |  | U    
|Canmar Victory       |  |       | 1979 |             |  | US/Canada via Montreal-Mediterranean |  |              | 1000 |         |  | Owned    |  |      | 19 |         |  | U    
|Canmar Bravery       |  |       | 1978 |             |  | US/Canada via Montreal-Mediterranean |  |              | 1700 |         |  | Owned    |  |      | 19 |         |  | U    
|Lykes Innovator      |  |       | 1997 |             |  | US East Coast-North Europe           |  |              | 2800 |         |  | STC      |  |      | 22 |         |  | U    
|TMM Jalisco          |  |       | 1988 |             |  | Gulf-North Europe                    |  |              | 3300 |         |  | Owned    |  |      | 21 |         |  | U    
|Lykes Discoverer(4)  |  |       | 1987 |             |  | Gulf-North Europe                    |  |              | 3000 |         |  | Owned    |  |      | 19 |         |  | U    
|Lykes Explorer(4)    |  |       | 1987 |             |  | Gulf-North Europe                    |  |              | 3000 |         |  | Owned    |  |      | 19 |         |  | U    
|Lykes Liberator(4)   |  |       | 1987 |             |  | Gulf-North Europe                    |  |              | 3000 |         |  | Owned    |  |      | 19 |         |  | U    
|Lykes Navigator(4)   |  |       | 1987 |             |  | Gulf-North Europe                    |  |              | 3000 |         |  | Owned    |  |      | 19 |         |  | U    
|Lykes Motivator(4)   |  |       | 1990 |             |  | Gulf-North Europe                    |  |              | 3000 |         |  | Owned    |  |      | 22 |         |  | U    
|Lykes Ambassador     |  |       | 1987 |             |  | Gulf-North Europe                    |  |              | 3300 |         |  | Owned    |  |      | 21 |         |  | U    
|TMM Campeche         |  |       | 1989 |             |  | Gulf-North Europe                    |  |              | 3000 |         |  | Owned    |  |      | 21 |         |  | U    
|TMM Nuevo Leon       |  |       | 1994 |             |  | Gulf-Mediterranean                   |  |              | 2400 |         |  | MTC      |  |      | 20 |         |  | U    
|TMM Sonora           |  |       | 1994 |             |  | Gulf-Mediterranean                   |  |              | 2400 |         |  | MTC      |  |      | 20 |         |  | U    
|Contship Inspiration |  |       | 1994 |             |  | Gulf-Mediterranean                   |  |              | 2400 |         |  | MTC      |  |      | 20 |         |  | U    
|Lykes Commander      |  |       | 1994 |             |  | Gulf-Mediterranean                   |  |              | 2400 |         |  | MTC      |  |      | 20 |         |  | U    
|                    
|Australasian         |  |       |      |             |  |                                      |  |              |      |         |  |          |  |      |    |         |  |       |  |  |  |  |  | 
|                    
|Contship Action      |  |       | 1996 |             |  | Europe-Australasia                   |  |              | 2800 |         |  | LTC      |  |      | 23 |         |  | U    
|Contship Ambition    |  |       | 1996 |             |  | Europe-Australasia                   |  |              | 2800 |         |  | LTC      |  |      | 23 |         |  | U    
|Contship Nobility    |  |       | 1996 |             |  | Europe-Australasia                   |  |              | 2800 |         |  | LTC      |  |      | 22 |         |  | U    
|Contship Optimism    |  |       | 1996 |             |  | Europe-Australasia                   |  |              | 2800 |         |  | LTC      |  |      | 22 |         |  | U    
|Contship Romance     |  |       | 1996 |             |  | Europe-Australasia                   |  |              | 2800 |         |  | LTC      |  |      | 22 |         |  | U    
|Contship Vision      |  |       | 1996 |             |  | Europe-Australasia                   |  |              | 2800 |         |  | LTC      |  |      | 22 |         |  | U    
|Contship Auckland    |  |       | 1998 |             |  | Ocean Star Round-the-World           |  |              | 2200 |         |  | STC      |  |      | 21 |         |  | G    
|Contship Rome        |  |       | 1998 |             |  | Ocean Star Round-the-World           |  |              | 2200 |         |  | MTC      |  |      | 21 |         |  | G    
|Contship Washington  |  |       | 1998 |             |  | Ocean Star Round-the-World           |  |              | 2200 |         |  | MTC      |  |      | 21 |         |  | G    
|Contship London      |  |       | 1997 |             |  | Ocean Star Round-the-World           |  |              | 2200 |         |  | MTC      |  |      | 21 |         |  | G    
|Direct Condor        |  |       | 2000 |             |  | US West Coast-Australasia            |  |              | 1700 |         |  | STC      |  |      | 20 |         |  | G    
|Direct Jabiru        |  |       | 2000 |             |  | US West Coast-Australasia            |  |              | 1700 |         |  | STC      |  |      | 20 |         |  | G    
|Direct Kestrel       |  |       | 2000 |             |  | US West Coast-Australasia            |  |              | 1700 |         |  | STC      |  |      | 21 |         |  | G    
|Direct Eagle         |  |       | 2000 |             |  | US West Coast-Australasia            |  |              | 1600 |         |  | STC      |  |      | 20 |         |  | G    
|Direct Falcon        |  |       | 1999 |             |  | US West Coast-Australasia            |  |              | 1700 |         |  | STC      |  |      | 20 |         |  | G    
|Direct Kiwi          |  |       | 1997 |             |  | US West Coast-Australasia            |  |              | 1700 |         |  | STC      |  |      | 20 |         |  | G    
|Direct Kea           |  |       | 1998 |             |  | US West Coast-Australasia            |  |              | 2200 |         |  | MTC      |  |      | 21 |         |  | G    
|Rotoiti              |  |       | 1977 |             |  | TransTasman                          |  |              | 800  |         |  | Owned    |  |      | 16 |         |  | Ro Ro
|Rotoma               |  |       | 1976 |             |  | TransTasman                          |  |              | 1200 |         |  | Owned    |  |      | 16 |         |  | Ro Ro

15



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##### Table of Contents



|                     |  |       |      |             |  |                                       |  |              |      |         |         |          |  |      |    |         |  |       |  |  |  |  |  | 
|-------------------- |  | ----- | ---- | ----------- |  | ------------------------------------- |  | ------------ | ---- | ------- | ------- | -------- |  | ---- | -- | ------- |  | ----- |  |  |  |  |  | 
|                     |  |       |      |             |  |                                       |  |              |      |         |         |          |  |      |    |         |  | Max.  |  |  |  | 
|                     |  |       |      |             |  |                                       |  |              |      | Nominal |         |          |  |      |    | Service |  |       |  | 
|                     |  | Year  |      |             |  |                                       |  | Capacity(1)  |      | Owned/  |         | Speed    |  | Ship
|Ship                 |  | Built |      | Trade Lanes |  | (teu)                                 |  | Chartered(2) |      | (knots) |         | Types(3)
|                     |  |       |      |             |  |                                       |  |              |      |         |         |         
|                    
|Latin American       |  |       |      |             |  |                                       |  |              |      |         |         |          |  |      |    |         |  |       |  |  |  |  |  | 
|                    
|Contship Spirit      |  |       | 1997 |             |  | North Europe-East Coast South America |  |              | 2500 |         |         | MTC      |  |      | 20 |         |  | G    
|Lykes Eagle          |  |       | 2000 |             |  | Gulf-East Coast South America         |  |              | 2100 |         |         | Owned    |  |      | 22 |         |  | G    
|TMM Tabasco          |  |       | 2000 |             |  | Gulf-East Coast South America         |  |              | 2100 |         |         | Owned    |  |      | 22 |         |  | G    
|Lykes Falcon         |  |       | 1997 |             |  | Gulf-East Coast South America         |  |              | 2100 |         |         | MTC      |  |      | 21 |         |  | G    
|Lykes Voyager        |  |       | 1995 |             |  | Gulf-East Coast South America         |  |              | 2100 |         |         | Owned    |  |      | 21 |         |  | G    
|Columbia             |  |       | 1996 |             |  | Gulf-Caribbean                        |  |              | 1600 |         |         | STC      |  |      | 20 |         |  | G    
|Thermaikos           |  |       | 1996 |             |  | Gulf-Caribbean                        |  |              | 1600 |         |         | STC      |  |      | 20 |         |  | G    
|Puerto Limon         |  |       | 1996 |             |  | Gulf-Caribbean                        |  |              | 1500 |         |         | STC      |  |      | 20 |         |  | G    
|TMM Guadalajara      |  |       | 1994 |             |  | Gulf-Caribbean                        |  |              | 2100 |         |         | Owned    |  |      | 21 |         |  | G    
|                    
|Asian                |  |       |      |             |  |                                       |  |              |      |         |         |          |  |      |    |         |  |       |  |  |  |  |  | 
|                    
|Lykes Achiever       |  |       | 1987 |             |  | Asia-Americas                         |  |              | 3300 |         |         | Owned    |  |      | 21 |         |  | U    
|Hyundai Pioneer      |  |       | 1986 |             |  | Asia-Americas                         |  |              | 3000 |         |         | STC      |  |      | 21 |         |  | U    
|Lykes Challenger     |  |       | 1986 |             |  | Asia-Americas                         |  |              | 3300 |         |         | Owned    |  |      | 21 |         |  | U    
|TMM Hermosillo       |  |       | 1986 |             |  | Asia-Americas                         |  |              | 3300 |         |         | Owned    |  |      | 21 |         |  | U    
|Lykes Crusader       |  |       | 1998 |             |  | Asia-Americas                         |  |              | 1700 |         |         | STC      |  |      | 20 |         |  | G    
|Lykes Pathfinder     |  |       | 1997 |             |  | Asia-Americas                         |  |              | 1700 |         |         | STC      |  |      | 20 |         |  | G    
|Northern Delight     |  |       | 1994 |             |  | Asia-Americas                         |  |              | 1700 |         |         | STC      |  |      | 19 |         |  | G    
|Hansa Arendal        |  |       | 2001 |             |  | Asia-Americas                         |  |              | 1600 |         |         | STC      |  |      | 21 |         |  | G    
|Contship Champion    |  |       | 1994 |             |  | Europe-India/Pakistan                 |  |              | 3500 |         |         | STC      |  |      | 23 |         |  | U    
|Contship Innovator   |  |       | 1997 |             |  | Europe-India/Pakistan                 |  |              | 2900 |         |         | STC      |  |      | 23 |         |  | U    
|Indamex Nhava Sheva  |  |       | 1997 |             |  | US East Coast-India                   |  |              | 1700 |         |         | STC      |  |      | 20 |         |  | G    
|Indamex Malabar      |  |       | 1994 |             |  | US East Coast-India                   |  |              | 1700 |         |         | STC      |  |      | 19 |         |  | U    
|Indamex Liberty      |  |       | 1994 |             |  | US East Coast-India                   |  |              | 1500 |         |         | STC      |  |      | 20 |         |  | G    
|Indamex New York     |  |       | 1995 |             |  | US East Coast-India                   |  |              | 1500 |         |         | STC      |  |      | 20 |         |  | G    
|                    
|Other Markets        |  |       |      |             |  |                                       |  |              |      |         |         |          |  |      |    |         |  |       |  |  |  |  |  | 
|Lykes Energizer      |  |       | 1992 |             |  | North America-South Africa            |  |              | 700  |         |         | MTC      |  |      | 17 |         |  | Ro Ro
|                    
|Lykes Raider         |  |       | 1990 |             |  | North America-South Africa            |  |              | 800  |         |         | MTC      |  |      | 17 |         |  | Ro Ro
|Lykes Inspirer       |  |       | 1990 |             |  | North America-South Africa            |  |              | 700  |         |         | MTC      |  |      | 17 |         |  | Ro Ro
|Lykes Winner         |  |       | 1990 |             |  | North America-South Africa            |  |              | 700  |         |         | MTC      |  |      | 17 |         |  | Ro Ro
|Lykes Runner         |  |       | 1992 |             |  | North America-South Africa            |  |              | 800  |         |         | MTC      |  |      | 17 |         |  | Ro Ro
|Absalon(5)           |  |       | 1984 |             |  | Break-bulk                            |  |              | 1100 |         |         | STC      |  |      | 17 |         |  | BB   
|IBN Bassam(5)        |  |       | 1977 |             |  | Break-bulk                            |  |              | 400  |         |         | STC      |  |      | 15 |         |  | BB   
|Contship Canberra(6) |  |       | 1998 |             |  | Sub-charter                           |  |              | 2200 |         |         | LTC      |  |      | 21 |         |  | G    
|Contship Noumea(6)   |  |       | 1998 |             |  | Sub-charter                           |  |              | 2200 |         |         | LTC      |  |      | 21 |         |  | G    
|TMM Sinaloa(6)       |  |       | 1987 |             |  | Repositioning                         |  |              | 3300 |         |         | Owned    |  |      | 21 |         |  | U    
|                     |  |       |      |             |  |                                       |  |              |      |         |         |          |  |      |    |         |  |       |  |  |  |  |  | 
|                    
|Total                |  |       |      |             |  |                                       |  |              |      |         | 164,400 |          |  |      |    |         |  |       |  |  |  |  |  | 



---

|(1) |  | Nominal capacity represents the total number of slots theoretically
available both above and below decks and is therefore different from
operational capacity which takes account of average cargo weight, destination
of cargo, weather conditions, draft limitations, ship stability, and other
factors which generally reduce the ship capacity, often significantly.                                                                                                                                                                                                                                                                       
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Bareboat charters are arrangements where the charterer becomes directly
responsible for providing crew and costs relating to operation and maintenance.
In contrast, under a time charter, the owner remains responsible for providing
the crew and for certain repairs and maintenance costs. A short-term charter
(STC) is a time charter of one year or less, medium-term charter (MTC) is a
time charter more than one year but less than three years; and long-term
charter (LTC) is a time charter three years or more. For each ship listed,
the duration of the term is determined as from the date of entering into the
charter.
|   
|(3) |  | Geared (G) ships have on-board cranes, while ungeared (U) do not.
Roll-on Roll-off (Ro Ro) ships are designed to handle cargo that is driven on
and off the ship, as well as containers that are lifted by cranes on or off the
ship. Break-bulk (BB) ships handle containers and non-containerized cargo.                                                                                                                                                                                                                                                                                                                             
|   
|(4) |  | Directly or indirectly owned U.S. flag ships, three of which
are under the U.S. MSP Program.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   
|(5) |  | One way voyage charters.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   
|(6) |  | Ships not employed by CP Ships at 31st March 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

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##### Table of Contents



Ship Replacement Program

CP Ships is currently mid-way through an $800 million ship replacement
program, commenced in 2000, to replace a number of its chartered ships with
owned ships. The replacement program follows the integration of various
acquisitions during the 1990s and a comprehensive review of its ship fleet
requirements, taking into account several key factors. First, CP Ships believes
that it can reduce its costs over the medium to long-term by owning ships
rather than chartering them. Second, a higher proportion of owned ships will
reduce its exposure to volatility in operating costs from the charter market
and therefore improve the stability of CP Ships expenses. Third, it is often
difficult to charter ships with optimum characteristics for certain trade lanes
at the time they are needed. Finally, new ship building prices at the time of
ordering were at relatively favourable levels.

The replacement ships will be medium-sized from 2000 to 4000 teu, which CP
Ships believes to be the optimal size range for operations in regional markets.
As at 31st March 2002, 12 used ships have been delivered. Commitments have been
made to purchase 10 new ships, currently under construction in Asian shipyards,
one further used ship and to enter into long term (eight years) charters for a
further six newly-built ships. Each new ship is specifically designed for its
proposed trade. For example, two ships are ice-strengthened, three have the
capacity to carry a significant number of refrigerated containers for
temperature sensitive cargo and five are geared, enabling them to operate in
ports without shoreside cranes. The ship replacement program remains on
schedule with the first of five 3200 teu newly-built ships scheduled for
deployment during the summer of 2002. The remaining nine new ships, one used
ship, and six long-term charters are scheduled to be delivered by the middle of
2003 and, based on current fleet size projections, will increase the percentage
of CP Ships owned fleet, including long-term charters, to approximately 75% of
fleet capacity.

Once the ship replacement program is completed in mid-2003, the number of
owned ships in CP Ships fleet will have more than doubled compared to
mid-2000, while the overall number of ships will have fallen slightly, due to
restructuring and rationalization of services, including replacing smaller
slower ships with larger faster ships, mainly in the TransAtlantic and
Australasian trade lanes. The ship replacement program will increase standing
capacity by approximately 7%, which is consistent with historic growth rates in
the global container trade. As a result of the program, CP Ships fleet under
charter will decrease from approximately 70% of fleet capacity as at 30th June
2000, to approximately 25% of fleet capacity by mid-2003. In the meantime, CP
Ships believes it is able to reduce ship costs on renewal of short term
charters by taking advantage of the currently depressed charter market. Once
the ship replacement program is completed, CP Ships expects annual capital
expenditures relating to ship purchases to decrease significantly.

The following table illustrates the composition of CP Ships ship fleet by
type of commitment excluding ships that sub-chartered or repositioning:

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##### Table of Contents



Historical and Target Fleet Size (1)

|           |  |                |    |                 |  |                         |     |            |  |       |    |            |  |  |     |   |  |  |    |  |  |  |     |  
|---------- |  | -------------- | -- | --------------- |  | ----------------------- | --- | ---------- |  | ----- | -- | ---------- |  |  | --- | - |  |  | -- |  |  |  | --- | -
|           |  | Adjusted(2)    |    | Adjusted(2)     |  | 2003 Target Fleet after
|           |  | fleet as at    |    | fleet as at     |  | Completion of the Ship 
|           |  | 30th June 2000 |    | 31st March 2002 |  | Replacement Program    
|           |  |                |    |                 |  |                        
|           |  | Ships          |    | % Capacity      |  | Ships                   |     | % Capacity |  | Ships |    | % Capacity
|           |  |                |    |                 |  |                         |     |            |  |       |    |           
|Owned(3)   |  |                | 21 |                 |  |                         | 28  | %          |  |       | 29 |            |  |  | 43  | % |  |  | 46 |  |  |  | 77  | %
|LT Charter |  |                | 12 |                 |  |                         | 19  | %          |  |       | 6  |            |  |  | 11  | % |  |  |   |  |  |  |    |  
|MT Charter |  |                | 4  |                 |  |                         | 8   | %          |  |       | 14 |            |  |  | 17  | % |  |  | 8  |  |  |  | 6   | %
|ST Charter |  |                | 40 |                 |  |                         | 45  | %          |  |       | 26 |            |  |  | 29  | % |  |  | 18 |  |  |  | 17  | %
|           |  |                |    |                 |  |                         |     |            |  |       |    |            |  |  |     |   |  |  |    |  |  |  |     |  
|Total      |  |                | 77 |                 |  |                         | 100 | %          |  |       | 75 |            |  |  | 100 | % |  |  | 72 |  |  |  | 100 | %



---

|(1) |  | The proportion of capacity in each category of ship within the overall
fleet is based on the standing capacity for each class of ships. The fleet at
31st March 2002 includes 12 ships already delivered to CP Ships under the ship
replacement program.                                                              
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | The adjusted fleet at 30th June 2000 and at 31st March
2002 excludes voyage charters, ships which are repositioning and ships which
are not currently employed in CP Ships services and are sub-chartered out.                                                                                                       
|   
|(3) |  | Owned ships include four ships held on bareboat charter and, as at 30th
June 2000, four long term chartered ships owned by certain U.S. trusts, the
beneficial interest in which was purchased by CP Ships in September 2001 and,
on completion of the ship replacement program, six long term (8 year) time
charters.

A summary of CP Ships ship replacement program is set out in the table
below.

|                       |  |     |    |            |  |                 |           |  |  |                               |  | 
|---------------------- |  | --- | -- | ---------- |  | --------------- | --------- |  |  | ----------------------------- |  | 
|Purchase               |  | No. |    | Size (teu) |  | Target Delivery
|                       |  |     |    |            |  |                
|Used                   |  |     | 8  |            |  |                 | 3000-3300 |  |  | Delivered                    
|Used                   |  |     | 4  |            |  |                 | 2100      |  |  | Delivered                    
|Long-term time charter |  |     | 6  |            |  |                 | 4100      |  |  | 1st half 2003                
|New                    |  |     | 3  |            |  |                 | 4100      |  |  | End 2002                     
|New (ice strengthened) |  |     | 2  |            |  |                 | 4100      |  |  | 2nd half 2003                
|Used                   |  |     | 1  |            |  |                 | 2300      |  |  | 3rd quarter 2003             
|New (geared)           |  |     | 5  |            |  |                 | 3200      |  |  | 2nd half 2002 / 1st half 2003
|                       |  |     |    |            |  |                 |           |  |  |                               |  | 
|Total                  |  |     | 29 |            |  |                 |           |  |  |                               |  | 

Containers

CP Ships operates the following fleet of containers with a total capacity
of approximately 348,000 teu as at 31st March 2002:

|               |  |          |         |        |  |       |         |  |  |  |         | 
|-------------- |  | -------- | ------- | ------ |  | ----- | ------- |  |  |  | ------- | 
|Container Type |  | Owned(1) |         | Leased |  | Total
|               |  |          |         |        |  |      
|               |  | (teu)    |         | (teu)  |  | (teu)
|               |  |          |         |        |  |      
|Standard       |  |          | 137,000 |        |  |       | 179,000 |  |  |  | 316,000 | 
|Specialized(2) |  |          | 5,000   |        |  |       | 27,000  |  |  |  | 32,000  | 
|               |  |          |         |        |  |       |         |  |  |  |         | 
|Total          |  |          | 142,000 |        |  |       | 206,000 |  |  |  | 348,000 | 



---

|(1) |  | Includes owned containers as well as those subject to finance
leases and a long term sale and leaseback. (2) Includes
temperature-controlled and other specialized units.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Between 1993 and 2001, CP Ships invested $145 million in the acquisition
of new containers. Currently, 41% of CP Ships container fleet is owned or held
under finance leases or sale and leaseback arrangements. CP Ships believes that
owning containers is generally less expensive than hiring them under short term
leases. However, short term leases provide CP Ships with the ability to reduce
or otherwise adjust its container fleet in response to changing trade
conditions or container imbalances in specific trade lanes. CP Ships long term
objective is to increase the proportion of owned containers in its fleet to
approximately 70%, although CP Ships currently has no significant commitments
to purchase containers.

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##### Table of Contents



Terminal Equipment

In 2001, CP Ships invested over $7 million in terminal equipment for the
Montreal terminal operations, completing $50 million of capital investment in
those facilities over five years. The main container handling equipment at the
Montreal terminals comprises nine ship-to-shore gantry cranes, 14 rubber tired
gantry cranes, 20 front-end loaders and 64 yard tractors.

Other Property

CP Ships has offices throughout the world, including its head office in
London, UK and major offices in Tampa, Florida and Montreal, Quebec. In
addition, CP Ships has other assets used in its business, such as furniture and
fixtures, information systems hardware and software, leasehold improvements and
motor vehicles, none of which are individually material.

Group Shared Services

Since 1996, CP Ships has achieved significant operating efficiencies by
combining the management of various decentralized services, including container
fleet, inland transport, marine operations, marine terminals, administration,
information systems and insurance and risk management. CP Ships expects to
achieve additional cost savings and operating efficiencies as it continues to
consolidate these shared services through further reorganization and
integration of its container fleet, inland transport functions and
administrative activities, all of which will be supported over time by new
information systems.

Container Fleet  Provision and Management.CP Ships operates with a
single company-wide container fleet. CP Ships acquires containers either by
direct purchase from container manufacturers or through short, medium or
long-term leasing arrangements with leasing companies. Purchasing and leasing
activities are fully centralized in order to achieve cost savings through
greater purchasing power. Empty positioning and other aspects of container
management are performed by regional units, which implement a centrally
developed strategy.

Inland Transport.The main regions where CP Ships provides a high volume
of inland transport services are Europe and North America. Inland transport
activities include the planning, execution and management of mainly outsourced
rail, truck, feeder ship and barge services used to transport containers
between ports and customer warehouses or inland depots or plants. Inland
transport movements are planned and executed through a network of local
operational offices located throughout Europe and North America under regional
direction.

CP Ships believes that it can achieve further efficiencies by continuing
to combine its volume of inland transport management at a regional and local
level. As a result, regional inland transport activities in Europe are managed
from operating centres in the UK, Germany, Belgium, France and Italy. In North
America, inland transport activities are managed from operating centres in
Montreal, Quebec and Tampa, Florida.

Marine Operations.Marine operations include ship procurement (including
time charters) and deployment, marine fuel purchasing, the contracting and
control of ship management services and the negotiation of marine terminal
contracts. CP Ships provides many of these services centrally to all of its
brands in order to achieve economies of scale, with regional and local
resources employed as appropriate. Marine fuel is available from a large number
of suppliers throughout the world.

CP Ships does not directly employ any sea-going staff. Instead, it
contracts with independent ship managers who provide crew for its owned and
bareboat chartered ships. A bareboat charter is broadly equivalent to ownership
but for a set period of time and involves the leasing of a ship only, with the
charterer providing the crew and paying all operating costs including repairs
and maintenance. A time

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##### Table of Contents



charter, which typically is for a shorter duration than a bareboat charter,
includes crew provided by the owner. Under the control of CP Ships, the ship
managers also supervise ship maintenance, dry-docking and technical management
according to an agreed budget and agreed ship maintenance policies and
procedures, and co-ordinate compliance with relevant legislation and
regulation.

Marine Terminals.CP Ships focuses on marine terminal operations in
several ways. First, it aims to combine volume from its various trade lanes and
services through common ports, where commercial, economic and operational
factors allow. Second, the marine operations group negotiates stevedoring and
marine terminal contracts using total volume to secure competitive pricing.
Third, CP Ships operates its own marine terminals in Montreal, Quebec where it
has improved operating efficiency and service reliability through a recently
completed capital investment program of $50 million in new cranes, terminal
equipment and infrastructure improvements.

CP Ships may actively pursue or participate in initiatives to improve upon
its existing terminal arrangements with independent port and terminal companies
where volumes, scale of operations and other economic factors justify focus.
For example, in late 1999, CP Ships concluded a long-term agreement with
Hessenatie, an Antwerp-based stevedore company, whereby it will commit all its
volume to secure priority berthing, ample terminal space and reduced cost at a
planned new terminal at the Port of Antwerp.

Administration.CP Ships is continuing to aggregate back-office activities
including export and import documentation, receivables, payables and other
accounting services, payroll and general administrative activities. Service
centres are being established across Europe and elsewhere under regional
management to replace several individual offices and provide centralized
documentation and certain accounting functions. CP Ships intends to set up
similar centres in other regions over the next 18 months.

Information Systems.CP Ships is currently in the process of developing a
single company-wide system as a replacement for the diverse operational
information systems it inherited with its various acquisitions. This will
include standardization of CP Ships on a single financial system platform. A
SAP accounting system has been successfully implemented in the Cast
organization and the results are under evaluation before further rollout is
made across the group. In the meantime, CP Ships is reducing the number of
separate operational and financial information system functions across its
organization in order to achieve better operating efficiencies.
Centrally-managed application development and technical support will provide
effective cost control and support common information technology (IT)
processes across the group. Two major data centres, located in the UK and in
the U.S., will support IT hardware and software for all corporate systems.

Implementation efforts continue within several of the lines to enhance
capabilities with GT Nexus, an industry e-commerce portal. The portal covers
rate requests, sailing schedule queries, documentation submissions and shipment
tracking functions. These efforts complement internal e-commerce projects.

Insurance and Risk Management.CP Ships provides centrally managed
insurance, risk management and claims support services with centres in Europe,
North America and Australia.

Sales and Marketing

Brands

CP Ships serves its customers through six distinct brands: ANZDL, Canada
Maritime, Cast, Contship Containerlines, Lykes Lines and TMM Lines. CP Ships
believes that its brands are recognized in the industry for their distinct
service offering, strong operating performance and superior customer relations.
In 2001 and 2000 all of CP Ships brands were recognized for service excellence
within the container shipping industry. For example in 2001, CP Ships brands
received the Australian Quality Council Gold Level Australian Business
Excellence Award; the Canadian International Freight Forwarders

20



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##### Table of Contents



Associations Best Overall Ocean Carrier of Year, Best Mediterranean Carrier of
the Year and Best European Carrier of the Year awards; Logistics Management and
Distribution Reports Quest for Quality Award and the LLP Liner Analysis Award
for schedule reliability. In 2000 CP Ships brands received the Achievement
Award, the highest award granted to any company by the New Zealand Business
Excellence Foundation; the Australian Quality Council Award for business
excellence; the Canadian International Freight Forwarders Association Carrier
of the Year award; Logistics Management and Distribution Reports Quest for
Quality award; International Freighting Weeklys UK Shipping Line of the Year
Award and Lloyds List Daily Commercial News Awards for Customer Service and
Schedule Reliability.

Sales

Sales and marketing activities are organized around the individual brands,
reinforcing CP Ships strategy of maintaining and strengthening its brands
within its regional markets. CP Ships policy is to have its own sales and
marketing organizations based, in the large majority of locations, in its
principal markets. It has over 200 sales and marketing offices.

Each brand contracts separately with third party sales agents in smaller,
developing or new markets. Third party agency arrangements may comprise full
service agreements (including sales, marketing, customer service and
back-office) or may be functionally specific, for example covering sales and
marketing activities or back-office services.

CP Ships recently formed a Global Accounts group to manage sales,
marketing and customer support relationships with large global customers with
activities in many trade lanes. This initiative was undertaken in order to
offer tailored regional coverage on a global scale thereby capitalizing on the
capabilities of the regional management teams and market knowledge.

Trademark and Licences

CP Ships does not rely on the licensing of intellectual property belonging
to other companies in marketing its brands other than in respect of certain
CP related trademarks which are owned by the successor of CPL, Fairmont
Hotels & Resorts Inc., and licensed to CP Ships.

Customers

CP Ships has three types of customers: exporters, importers, and
intermediaries. Exporters include a wide range of enterprises, from global
manufacturers (including the major automotive companies that may ship thousands
of teu annually) to small family owned businesses (which may ship just a few
teu each year). Importers are usually the direct purchasers of goods from
exporters but may also comprise sales or distribution agents or may be the
receiver of the containerized goods at the final point of delivery.
Intermediaries act as agents for exporters and importers, performing a range of
duties such as rate negotiation, bookings, documentation, insurance, customs
clearance, billing and payments, inland transport, warehousing and container
tracking services which would otherwise be part of the carriers door-to-door
service. Intermediaries usually receive a commission from the carrier as well
as from customers for performing these activities. Commissions paid to
intermediaries by carriers generally range from 1.5% to 2.5% of the shipping
contract value, although they may sometimes be paid on a fixed fee basis,
typically in the range of $25 to $35 per teu.

Normally one party involved in a shipment  the exporter, the importer or
the intermediary  controls the selection of the carrier with such control
usually depending on the terms of sale in the contract between an exporter and
an importer. The extent to which exporters, importers or their intermediaries
control carrier selection varies depending on the trade lane involved.

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CP Ships markets its services to exporters and importers at both ends of
the trade lane. By providing comprehensive sales coverage in this way, CP Ships
builds knowledge about its customers (and other parties involved in the
shipment), enhances its customer relations, builds brand loyalty and preserves
market share. It also carries out regular marketing surveys to evaluate
customer satisfaction with its services and establishes benchmarks for its
services derived from its main competitors. Key performance criteria include an
assessment of CP Ships service offerings, the level of service quality
delivered, as well as other measures including the competitiveness of its
freight rate quotations and the timeliness and accuracy of its documentation
and invoicing. In CP Ships view, based on industry and company customer
surveys, customers expect to receive from carriers reliable, consistent and
cost-effective ocean and inland transport services, schedule reliability,
container availability and problem solving. CP Ships reviews the results of
these surveys to continuously improve the quality and range of service
offerings.

General practice within the container shipping industry is to provide
standard credit terms to the party that is responsible for paying the
transportation charges. The amount of credit and the credit period depends on a
number of factors including the customers financial status, its credit history
with the carrier, the frequency and size of its shipments and overall size and
type of business. CP Ships credit terms are consistent with general industry
practice.

CP Ships has a diverse customer base. In 2001, CP Ships top ten customers
accounted for approximately 9% of volume or 6% of revenue. The single largest
customer accounted for approximately 2% of volume or 1% of revenue in 2001.

Competition

The container shipping industry is highly competitive. While the worlds
top 20 carriers, by capacity, control 57% of global container capacity, the
industry remains highly fragmented with over 500 carriers operating world-wide.
Within the trade lanes it serves, CP Ships competes against a wide range of
global, regional and niche carriers.

Global carriers generally deploy significant ship capacity and operate
extensive service networks in most trade lanes in the major East-West markets,
as well as in selected regional markets. These carriers generally deploy large
ships and serve major ports with direct calls and other ports through
transhipment over regional hubs. Global carriers that compete with CP Ships
include Hapag Lloyd, Maersk Sealand, Mediterranean Shipping, OOCL and P&O
Nedlloyd.

Regional carriers generally focus on a number of smaller trade lanes
within the major East-West markets, or within regional markets such as
Australasia, Africa, Latin America and India. These carriers tend to offer
direct services to a wider range of ports within a particular market than
global carriers. Regional carriers that compete with CP Ships include Compania
Sudamericana de Vapores, Hamburg Sud, Shipping Company of India and United Arab
Shipping Company.

Niche carriers are similar to regional carriers but tend to be even
smaller in terms of the amount of ship capacity they operate and the number and
size of the markets they cover. Niche carriers that compete with CP Ships
include Atlantic Container Line, Dole Fruit, Kien Hung, Samudera and Seaboard
Marine.

Many of CP Ships competitors are also involved in other transportation
businesses such as logistics, dry and liquid bulk shipping and intermodal
transport. In addition, other competitors are also involved in unrelated
industries such as oil exploration, travel services and retail. As part of its
strategy, CP Ships concentrates exclusively on container shipping. CP Ships
believes that such specialization allows management to better plan for, and
quickly respond to, what are often rapidly changing economic, political and
trade conditions in the industry.

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Employees

The number of employees of CP Ships at 31st March 2002 was approximately
4,150 with 43% of the staff located in North America, 43% in Europe and the
balance mainly in Australasia and South America. CP Ships employees are
divided by function almost evenly between (i) sales and marketing, (ii)
customer service, (iii) shared services and (iv) administration and accounting,
with the head office of CP Ships accounting for less than 1% of the total.
Employees engaged in shared services include those responsible for container
fleet management, co-ordination of inland transport services, certain IT
functions, insurance and risk management and marine operations such as ship
procurement, marine fuel purchasing, ship management services and the
negotiation of marine terminal contracts.

Less than 3% of CP Ships employees are employed under collective
bargaining agreements. CP Ships believes that its relations with employees are
good. CP Ships further believes that the material terms of its collective
bargaining agreements and other terms of employment are customary for the
industry, as are the classification of its employees and the geographic
locations covered by such agreements.

Insurance

CP Ships maintains insurance policies to cover risks related to physical
damage to its ships and ship equipment, other equipment (such as containers,
chassis, terminal equipment, trucks) and properties, as well as third party
liabilities arising from the carriage of goods and the operation of ships and
shore-side equipment, and general liabilities which may arise through the
course of its normal business operations.

CP Ships owned ships are insured with a group of major insurance
companies for physical damage, including war and terrorist risks, and total
loss up to their full individually declared values on an annual basis. The
declared value of the ship is the assessed market value of the ship. A further
25% of the value is also covered under an increased value policy, in order to
meet additional expenses that might arise from the total loss of a ship.
Although it is normal for this coverage to be placed annually, CP Ships is
currently mid-way through a three-year policy. In addition, owned ships calling
in areas identified by the marine insurance market as specified war risk zones
are temporarily covered for war risks by declaration and payment of an
additional premium. Under its charter agreements, CP Ships is required to pay
additional premiums when its chartered ships call in a war risk zone. The list
of war risk areas was expanded as result of underwriters perception of
increased risk following the terrorist attacks on 11th September 2001, the
identification of the responsible parties and the subsequent conflict in
Afghanistan.

Protection and Indemnity Insurance (P&I) provides cover for: third party
claims arising from the carriage of goods including loss or damage to cargo;
claims arising from the operation of owned and chartered ships including injury
or death to crew, passengers, or other third parties; claims arising from
collisions with other ships; damage to other third-party property; pollution
arising from oil and other substances; and salvage and other related costs. CP
Ships P&I cover is divided between two respected P&I Clubs, both of which are
members of the International Association of P&I Clubs. Members of this
association arrange a pooling insurance and a substantive re-insurance program,
and insure approximately 90% of the worlds ocean-going merchant fleet. Members
of P&I Clubs are subject to calls payable to the association based on the
members claim record as well as the claim records of all other members of the
association. The sum insured by P&I cover is up to approximately $4.25 billion
per incident. CP Ships equipment fleet (containers and chassis) is insured in
the Lloyds and London Companies market for physical damage, including war
risks, and liabilities arising thereunder. The terminals in Montreal are
insured for such risks with the TT Club, the worlds largest insurer of
terminals.

As a result of the significant insurance losses incurred in the 11th
September 2001 attacks and related concern regarding terrorist attacks, the
worlds insurance markets increased premiums and reduced or

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restricted cover for terrorist losses generally. Accordingly, premiums payable
by CP Ships for terrorist cover have increased substantially and the level of
terrorist cover has been significantly reduced.

CP Ships also maintains additional insurance policies to cover a number of
other risks including: strikes and delays; liability arising from documentary
or procedural errors and omissions; workers compensation; motor fleet; office
buildings; directors and officers liability; and general liabilities. CP
Ships believes that the types and amounts of insurance coverage it currently
maintains are in line with customary practice in the international container
shipping industry and are adequate for the conduct of its business.

Regulatory Matters

CP Ships operations are materially affected by government regulation in
the form of international conventions, national, state and local laws and
regulations in force in the jurisdictions in which the ships operate, as well
as in the country or countries of their registration. Because such conventions,
laws and regulations are subject to revision, it is difficult to predict the
continuing cost of compliance with such conventions, laws and regulations, the
impact thereof on the resale price or useful life of ships or on business
operations. Various governmental and quasi-governmental agencies require
holding certain permits, licenses and certificates with respect to marine
operations. Subject to the discussion below and to the fact that the kinds of
permits, licenses and certificates required for the operations of its owned
ships will depend upon a number of factors, CP Ships believes that it has been
and will be able to retain or obtain all permits, licenses and certificates
material to the conduct of its operations.

Maritime Regulations

United States.In the U.S., carrier operations of CP Ships serving U.S.
ports are subject to the provisions of the Shipping Act of 1984 (the Shipping
Act), as amended by the Ocean Shipping Reform Act of 1998 (OSRA). Among
other things, the Shipping Act confers immunity from antitrust laws for certain
co-operative agreements between ocean common carriers operating in the U.S. The
most common types of agreements are slot exchange agreements, whereby carriers
share space on each others ships, and rate discussion agreements, in which
carriers may co-ordinate, discuss and voluntarily agree on ocean freight rates
and charges and other terms and conditions of service (collectively, Carrier
Agreements). Adherence to decisions reached in such discussion agreements is
purely voluntary. To receive an antitrust exemption, Carrier Agreements must be
filed with the U.S. Federal Maritime Commission (FMC). Under the Shipping
Act, as amended, carriers serving U.S. ports may offer transport services to
customers either through semi-confidential service contracts or through
publicly available tariffs. The Shipping Act requires carriers to publish their
tariff rates and certain service contract terms electronically to allow public
internet access. Carrier operations of CP Ships via U.S. ports are subject to
Shipping Act and FMC regulatory requirements relating to carrier agreements,
tariffs, and service contracts. Civil penalties of up to $30,000 per violation
can be imposed on carriers that fail to adhere to these statutory and
regulatory requirements.

The past decade has witnessed a shift to discussion agreements from
traditional conference agreements. Unlike discussion agreements which reach
decisions on a voluntary adherence basis, conference agreements make binding
decisions on the basis of voting (subject to defined rights of individual
members to deviate from certain collective rate actions) and the conference
publishes tariffs and offers group service contracts, in both cases setting
forth agreed rates, terms and conditions of transportation applicable to
conference members.

Under the U.S. Maritime Security Act of 1996, U.S.-documented ships that
are operated in a common carrier service are eligible to apply for an annual
subsidy payment (MSP Program). Three of the U.S. flag Pacific Class ships
indirectly owned by CP Ships are enrolled in the MSP Program, and CP Ships

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receives an annual subsidy payment of approximately $2 million per ship.
Although the MSP Program continues until 30th September 2005, funding for the
MSP Program must be approved by U.S. Congress on an annual basis. As a
pre-condition to receipt of the annual subsidy payment under the MSP Program,
the operator or charterer of the ships must enter into an emergency
preparedness agreement with the U.S. Secretary of Transportation. Accordingly,
a subsidiary of CP Ships has entered into such an agreement with the U.S.
Secretary of Transportation pursuant to which such subsidiary agrees to make
its ships, capacity in ships, intermodal systems and equipment, terminal
facilities, management service and related service available to the U.S.
government in the event of war, national emergency or when the U.S. Secretary
of Defence determines it to be necessary for national security.

Following the terrorist attacks on 11th September 2001, the U.S.
Government adopted certain measures to improve security at various U.S. ports
and with respect to cargo movements to and from the U.S. The Congress and
federal agencies are continuing to review the possibility of imposing
additional security related measures. It is possible that some of these
measures could adversely affect the efficiency of operations of CP Ships or
result in additional costs. It is as yet too early to determine with any
precision the nature and extent of the measures that may be adopted in the U.S.

Canada.In Canada, the Shipping Conferences Exemption Act, 1987 (SCEA)
exempts certain shipping conference practices, such as agreeing to terms and
prices by way of published tariffs or service contracts, pooling volumes, and
exchanging market data with the objective of achieving trade stability, from
the provisions of the Competition Act. This allows for partial anti-trust
immunity provided that, among other things, on request a shipping conference is
required to meet, notify and discuss issues which arise with the Canadian
Shippers Council.

Recent amendments to SCEA include provisions (a) permitting conference
carriers to offer individual confidential service contracts, (b) permitting
carriers to file rates and tariffs electronically, (c) providing for penalties
of C$10,000 per offence, and (d) reducing the notice period for independent
action from fifteen to five days. In general, these amendments brought the
Canadian regulatory environment closer to U.S. and European regulation.

European Union.The European Union (EU) recognizes traditional
conferences but not discussion agreements. In the EU, CP Ships is affected by
the regulations under the Treaty of Amsterdam (formerly the Treaty of Rome)
(Treaty). Under the Treaty, CP Ships is subject to European Community (EC)
Regulation 4056/86 (Reg. 4056/86) and EC Regulation 823/00 (Reg. 823/00).

Under Reg. 4056/86, carriers are entitled to give effect to rate fixing
agreements in relation to the ocean carriage of cargo to and from the EU (and
the European Economic Area) member states. This is in derogation of the
fundamental prohibition of cartels imposed by Article 81 of the Treaty. Such
derogation is subject to certain qualifications. These permitted rate fixing
agreements relate to specific trade lanes. They are known as liner
conferences. Many of CP Ships liner services are members of the relevant
liner conferences, primarily in the trade lanes between North Europe and
Canada, and between Europe and Australia, New Zealand, South America and
India/Pakistan. Recent changes being discussed by the EC may affect the
procedures relevant to Reg. 4056/86. These changes, intended to be implemented
in 2003, would transfer the burden of testing compliance with Reg. 4056/86 and
Article 81 of the Treaty, and the application of exemptions under Article 81,
from the Commission to a self-assessment regime open to verification by
interested parties (at the national court level or with the EC) or by the EC
itself.

Reg. 823/00, known as the consortia regulation, permits carriers trading
to and from the EU to coordinate, subject to certain conditions, the operation
of their ships in particular trade lanes, in order to promote greater
efficiency in the optimising and scheduling of shipping capacity. Such
permitted coordination is subject to certain qualifications and is distinct
from, and must not include, freight rate fixing agreements (as permitted by
Reg. 4056/86). CP Ships participates, world-wide, in a number of such

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arrangements, several of which are subject to Reg. 823/00 by reason of trade to
and from EU member states.

Australia.In Australia, Part X of the Trade Practices Act 1974 (TPA)
provides registered liner cargo shipping conference agreements with exemptions
from provisions of the TPA which would otherwise prohibit contracts or
arrangements to lessen competition and corporations engaging in the practice of
exclusive dealing. These exemptions allow conferences to agree upon freight
rates, pool earnings and costs, rationalize capacity and restrict new entrants
to the conference agreement.

Recent amendments to Part X include the extension of exemptions relating
to rate setting to terminal to terminal type shipping negotiations, the
extension of Part X to cover inward conferences, the increase in the powers of
the Minister of Transport and the Australian Competition and Consumer
Commission to resolve anti-competitive conduct, a requirement that closed
conferences accept new members in certain circumstances and allowing shipping
conferences to negotiate collectively with stevedores for the provision of
stevedoring services to member lines of those conferences.

Recent developments in anti-trust immunities. The anti-trust immunities
described above have historically been justified on the grounds that they are
necessary to assure shippers of stable freight rates and reliable scheduled
liner shipping services. These immunities have been in place in various forms
for many years in the United States, Canada, European Union and Australia.
However, they have been gradually eroded and narrowed through legislative and
regulatory amendments and court decisions. For example, in 1998 the OSRA
introduced measures designed to increase the level of competition in the United
States between carriers. In 2001, amendments to the SCEA contained changes
similar to those found in the OSRA and which were also designed to increase
competition in Canada between carriers.

Three decisions issued by the European Court of First Instance on 28th
February 2002 held that the immunities contained in EC Reg. 4056/86 apply only
to port to port services, and do not permit fixing of tariffs for the inland
leg of intermodal services. This decision may still be appealed and if
confirmed, will affect carriers offering intermodal services in Europe,
including CP Ships.

In May 1999, the Secretariat of the Organisation for Economic Co-operation
and Development (the OECD) published a report entitled Discussion document
on regulatory reform in international maritime transport. The report
recommended, among other things, that agreements among carriers to set common
rates should no longer receive automatic antitrust immunity or exemption.

In April 2002, the OECD Secretariat published its final report entitled
Competition Policy in Liner Shipping (the OECD Report) which, among other
things, concluded that there is no evidence that the liner shipping industry
needs to be protected from competition by anti-trust immunity for price-fixing
and rate discussions, and that there is no evidence that the conference system
leads to more stable freight rates or more reliable shipping services than
would be the case in a fully competitive market. The OECD Report concluded that
countries should (i) seriously consider removing anti-trust exemptions for
common pricing and rate discussion and (ii) have the discretion to retain
exemptions for other operational arrangements relating to liner shipping so
long as these did not result in excessive market power. The container shipping
industry has disputed many of the factual findings contained in the OECD Report
and is vigorously opposing the implementation of its recommendations.

In February 2002 the European Commission, noting the Draft OECD Report
(published in November 2002 prior to the OECD Report), announced that it would
study, and re-assess the justifications for, the existing exemptions for liner
conferences provided in EC Reg. 4056/86. This is the first time that EC Reg.
4056/86 has been formally reviewed by the European Commission since enactment
of the Regulation in 1986.

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Environmental Regulations

United States.In the U.S., ship operators are subject to a number of
federal and state laws and regulations with respect to protection of the
environment in the course of ship operations in U.S. trade lanes. The primary
laws are the Oil Pollution Act of 1990 (OPA 90) with respect to oil spill
liability, the Comprehensive Environmental Response, Compensation, and
Liability Act (CERCLA) with respect to spills or releases of hazardous
substances, the Federal Water Pollution Control Act (FWPCA), also called the
Clean Water Act, and the National Invasive Species Act of 1996 (NISA) with
respect to ballast water management.

Under OPA 90, ship owners, operators, and bareboat charterers are deemed
Responsible Parties and are jointly, severally and strictly liable for all
removal costs and other damages caused by oil spills from their ships. Although
OPA 90 is primarily directed at oil tankers (which CP Ships does not operate),
it also applies to non-tanker ships with respect to the fuel carried on board
the ships. OPA 90 limits the liability of non-tanker owners to the greater of
$600 per gross ton or $500,000 per discharge, which may be adjusted
periodically for inflation. The liability limits do not apply if the incident
was caused by the Responsible Partys gross negligence, wilful misconduct, or a
violation of an applicable federal safety, construction, or operating
regulation. In addition, the liability is not limited if the Responsible Party
fails to report the oil spill or fails to cooperage or comply with a removal
order.

OPA 90 requires all Responsible Parties to establish and maintain evidence
of financial responsibility sufficient to meet the maximum liability to which
it could be subject under OPA 90. Financial responsibility may be established
by any combination of the following: evidence of insurance, surety bond,
guarantee, letter of credit, qualification as self-insurer or other evidence of
financial responsibility. CP Ships believes that it has sufficient insurance
with its P&I Clubs to cover damages that might arise under OPA 90. However, OPA
90 specifically preserves state law liability and remedies, whether by statute
or common law; state law liability is not subject to the OPA 90 limitations of
liability. Some states have enacted legislation providing for unlimited
liability for oil spills both in terms of removal costs and damages. As such,
overall liability under state law for a spill is virtually unlimited, and could
theoretically exceed CP Ships available insurance coverage in the case of a
catastrophic spill.

CERCLA governs spills or releases of hazardous substances other than
petroleum, natural gas, and related products. CERCLA imposes strict and joint
and several liability on the owner or operator of a ship, vehicle or facility
from which there has been a release, as well as other responsible parties.
Damages may include removal costs, natural resource damages, and economic
losses without regard to physical damage to a proprietary interest.

The Clean Water Act prohibits the discharge of oil or hazardous substances
and imposes strict liability in the form of penalties for damages and remedial
costs. The Clean Water Act now serves largely to provide backup coverage with
respect to remedial costs to the more recent OPA 90 and CERCLA.

NISA was enacted in 1996 in response to growing reports of harmful
organisms being released into U.S. ports through ballast water taken on by
ships in foreign ports. NISA established a ballast water management program for
ships entering U.S. waters calling for voluntary mid-ocean ballast water
exchange, retention of ballast water onboard the ship, or the use of
environmentally sound alternative ballast water management methods approved by
the U.S. Coast Guard. If the mid-ocean ballast exchange is made mandatory
throughout the U.S., or if water treatment requirements or options are
instituted, the costs of compliance could increase for ocean carriers,
including CP Ships.

Canada.In Canada, shipowners are faced with a number of Canadian federal
and, to a lesser degree, provincial environmental laws which apply to shipping
operations and related activities in Canadian waters. These laws include the
Marine Liability Act, Canada Shipping Act, Environmental Protection Act,

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Fisheries Act and Ocean Dumping Control Act. The Marine Liability Act (MLA)
gives effect to the International Convention on Civil Liability for Oil
Pollution Damages, 1969 and the International Convention on the Establishment
of the International Fund for Compensation for Oil Pollution Damage as amended
by protocols in 1976 and 1992. The MLA imposes liability on the shipowner for
oil pollution damage and for costs and expenses incurred in respect of measures
taken to prevent, repair, remedy or minimize that pollution. Unless the
pollution results from a personal act or omission of the shipowner committed
with intent to cause the pollution, or recklessly and with knowledge that
pollution damage would probably result, the maximum liability of the shipowner
is limited to 3,000,000 International Monetary Fund Special Drawing Rights per
ton of the ships gross tonnage for the first 5,000 tons and 420 Special
Drawing Rights per subsequent ton. The law requires that certificates of
insurance or other security be issued in respect of each ship. All of CP Ships
owned ships carry such certificates.

The Canada Shipping Act, Environmental Protection Act, Fisheries Act and
Ocean Dumping Control Act prohibit dumping of deleterious substances at sea
which would adversely affect the fishery and other aspects of the environment.
Those laws, as well as the common law, create a civil cause of action against
the offender.

The Racine and Cast terminals in Montreal are subject to various federal
and province of Québec environmental laws. The Québec Environmental Quality Act
imposes liability jointly and severally on all persons who have ownership,
custody or control over contaminants and persons responsible for emission,
deposit or discharge of any contaminant.

Australia.Australian law governing marine pollution from ships takes the
form of domestic enactment of international conventions. The Commonwealth, the
States and the Northern Territory of Australia have all legislated to give
effect to some of the conventions listed below, but there is no uniformity
between the various jurisdictions. Different jurisdictions have given effect to
different conventions in different ways. The core of MARPOL 73/78 (referred to
below) has been adopted in Australia by the Protection of the Sea (Prevention
of Pollution from Ships) Act, 1983 (PSA). All of the States of Australia and
the Northern Territory have their own legislation implementing Annex I and II
of MARPOL.

Effective as at October 2001, the PSA was amended to include provisions:
(a) requiring ships of 400 tons or more, or certified to carry 15 or more
persons, to have a shipboard waste management plan and to carry and maintain a
garbage record book; (b) expanding incident reporting requirements so that
ships of 15 metres or more must report any incident that affects the safety of
the ship having the potential to result in the pollution (previously, reporting
was required in respect of an incident only when there was a probability of
pollution); and (c) empowering surveyors to require a ship to discharge waste
in port, where it becomes clear that the ship would have to discharge some
waste at sea before reaching its next port of call.

The Commonwealth and State Acts implementing Annex I and II of MARPOL (a)
prohibit the discharge of oil or an oily mixture into the sea subject to
certain exceptions; (b) impose a duty to report certain incidents involving oil
or an oily mixture; and (c) require all Australian tankers or ships over 400
GRT (Gross Registered Tonnage) to maintain an oil record book according to the
regulations outlined in those Acts. A maximum penalty of A$1.1 million can be
imposed against the owner of a ship and A$220,000 against the master of a ship
for breaches of the Acts. In New South Wales, forthcoming legislation will
increase the maximum penalties for pollution from A$220,000 to A$500,000 for
individuals and from A$1.1 million to A$10 million for corporations. The
proposed new penalties will be the highest fines in Australia for marine oil
and chemical spills.

The International Convention on Civil Liability for Oil Pollution Damage,
1969 (known as CLC), as amended by Protocols dated 1976, 1984 and 1992, was
implemented by the Commonwealth by enactment

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of the Protection of the Sea (Powers of Intervention) Act, 1981. The Dumping
Convention was implemented by the Commonwealth by enactment of the Environment
Protection (Sea Dumping) Act, 1981. That Act was amended in 1994 to give effect
to Australias obligations under the Protocol for the Prevention of Pollution
of the South Pacific Region by Dumping (SPREP) Protocol. Legislation was
passed in 1993 to give effect to the Fund Convention in Australia. The
Protection of the Sea (Oil Pollution Compensation Fund) Act, 1993 provides for
who is to contribute to an international oil pollution compensation fund, how
much they must contribute and how such contributions are to be completed.

The Protection of the Sea (Civil Liability) Amendment Act, 2000 provides
that: (a) ships over 400 GRT will be required to have appropriate insurance in
place to meet liabilities arising from pollution damage caused by the discharge
of oil; and (b) a breach of this Act will result in a strict liability offence
which carries penalties of up to A$55,000.

International.Globally, the International Maritime Organization (IMO)
has adopted MARPOL 73/78, which relates to environmental standards including
oil leakage or spilling, garbage management, as well as the handling and
disposal of noxious liquids, harmful substances in packaged forms, sewage and
air emissions. Compliance with MARPOL is not yet mandatory. However, CP Ships
endeavours to comply with all materially relevant provisions of the convention.

The IMO adopted the International Convention for the Safety of Life at Sea
or SOLAS Convention, which imposes a variety of standards to regulate design
and operational features of ships. SOLAS standards are revised periodically. CP
Ships believes that all ships, either owned or chartered by it, comply with
SOLAS standards. SOLAS also incorporates the International Safety Management
Code (ISM). The ISM requires, among other things, ship operators to implement
environmental and safety management systems. CP Ships has obtained ISM
accreditation for all its owned ships and for the management companies
operating those ships.

The majority of CP Ships marine operations activities has been awarded
accreditation under the ISO 14001 Environmental Management Code. The purpose of
ISO 14001 accreditation is to ensure that all company marine operations
activities which relate to the environment conform to all materially relevant
international conventions, national and local laws and regulations and create
the framework required to continuously improve directly or indirectly related
internal processes, procedures and activities. Accreditation of CP Ships
remaining marine and terminal operations is expected during the course of 2002.

All of CP Ships owned and chartered ships operate under the International
Ship Management Codes standard of safe operations. CP Ships owned ships are
registered with internationally recognized Classification Societies including
Lloyds, Bureau Veritas, ABS, and DNV. The principal purpose of Classification
Societies is to provide objective and independent confirmation to the insurance
underwriters that ships are being maintained to the standards that are
considered appropriate to minimize claims on underwriters. A beneficial
by-product of the activities of Classification Societies is to provide
reassurances to owners and others with a financial or other interest in those
ships that they are being regularly surveyed and properly maintained.

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SELECTED CONSOLIDATED FINANCIAL INFORMATION

Prior to 1st October 2001, CP Ships Holdings Inc. (CPSHI) was the wholly
owned holding company of CPLs container shipping interests. On 1st October
2001, as part of a Plan of Arrangement, CPL distributed its interests in CPSHI
to CP Ships, a newly created subsidiary company of CPL. CPL then distributed
its investment in CP Ships to its common shareholders on the basis of one new
common share in CP Ships for four old CPL common shares. Where appropriate,
share numbers in the financial statements reflect the effect of the share
consolidation applied retroactively. As both CPSHI and CP Ships were under the
control of CPL at the time, the transactions have been accounted for in a
manner similar to a pooling-of-interests and the historical financial
information of CPSHI has become the historical financial information of the now
publicly held CP Ships.

Subject to the foregoing, the following table sets forth certain financial
information for CP Ships or its predecessor and its subsidiaries on a
consolidated basis under Canadian Generally Accepted Accounting Principles for
the last five fiscal years.

Consolidated Statements of Income Data
($ millions, except amounts per share, presented in $)

|                                            |  |                          |        |      |  |      |        |      |  |         |        |   |  |   |        |   |  |   |       |  
|------------------------------------------- |  | ------------------------ | ------ | ---- |  | ---- | ------ | ---- |  | ------- | ------ | - |  | - | ------ | - |  | - | ----- | -
|                                            |  | Year ended 31st December
|                                            |  |                         
|                                            |  | 2001                     |        | 2000 |  | 1999 |        | 1998 |  | 1997(1)
|                                            |  |                          |        |      |  |      |        |      |  |        
|Revenue                                     |  |                          | 2,646  |      |  |      | 2,645  |      |  |         | 1,878  |   |  |   | 1,780  |   |  |   | 1,032 |  
|Expenses                                    |  |                          | (2,507 | )    |  |      | (2,481 | )    |  |         | (1,789 | ) |  |   | (1,653 | ) |  |   | (917  | )
|Operating income before exceptional charges |  |                          | 139    |      |  |      | 164    |      |  |         | 89     |   |  |   | 127    |   |  |   | 115   |  
|Exceptional charges                         |  |                          | (36    | )    |  |      |       |      |  |         |       |   |  |   |       |   |  |   |      |  
|Operating income                            |  |                          | 103    |      |  |      | 164    |      |  |         | 89     |   |  |   | 127    |   |  |   | 115   |  
|Interest income (expense), net              |  |                          |       |      |  |      | 1      |      |  |         | (4     | ) |  |   |       |   |  |   | 3     |  
|Income tax expense                          |  |                          | (12    | )    |  |      | (12    | )    |  |         | (11    | ) |  |   | (7     | ) |  |   | (10   | )
|Minority interest                           |  |                          | 1      |      |  |      |       |      |  |         | 1      |   |  |   |       |   |  |   |      |  
|Goodwill charges                            |  |                          | (16    | )    |  |      | (18    | )    |  |         | (15    | ) |  |   | (11    | ) |  |   | (8    | )
|Net income (2)                              |  |                          | 76     |      |  |      | 135    |      |  |         | 60     |   |  |   | 109    |   |  |   | 100   |  
|Earnings per Common Share basic (3)         |  | $                        | 0.92   |      |  | $    | 1.68   |      |  | $       | 0.76   |   |  | $ | 1.38   |   |  | $ | 1.26  |  
|Earnings per Common Share diluted (3)       |  | $                        | 0.91   |      |  | $    | 1.68   |      |  | $       | 0.76   |   |  | $ | 1.38   |   |  | $ | 1.26  |  

Consolidated Balance Sheet Data
($ millions)

|                          |  |                     |       |      |  |      |       |      |  |         |       |  |  |  |       |  |  |  |     | 
|------------------------- |  | ------------------- | ----- | ---- |  | ---- | ----- | ---- |  | ------- | ----- |  |  |  | ----- |  |  |  | --- | 
|                          |  | As at 31st December
|                          |  |                    
|                          |  | 2001                |       | 2000 |  | 1999 |       | 1998 |  | 1997(1)
|                          |  |                     |       |      |  |      |       |      |  |        
|Cash and cash equivalents |  |                     | 116   |      |  |      | 122   |      |  |         | 61    |  |  |  | 95    |  |  |  | 104 | 
|Capital assets            |  |                     | 795   |      |  |      | 536   |      |  |         | 355   |  |  |  | 301   |  |  |  | 229 | 
|Total assets              |  |                     | 1,851 |      |  |      | 1,748 |      |  |         | 1,218 |  |  |  | 1,143 |  |  |  | 932 | 
|Total debt                |  |                     | 230   |      |  |      | 32    |      |  |         | 44    |  |  |  | 51    |  |  |  | 43  | 
|Common share capital      |  |                     | 597   |      |  |      | 63    |      |  |         | 63    |  |  |  | 63    |  |  |  | 63  | 
|Shareholders equity      |  |                     | 1,100 |      |  |      | 1,099 |      |  |         | 649   |  |  |  | 540   |  |  |  | 348 | 



---

|(1) |  | At 1st January 1998, CP Ships changed its reporting currency from the
Canadian dollar to U.S. dollar. The income statement for the year ended 31st
December 1997 and the balance sheet at that date has been translated into U.S.
dollars at the 31st December 1997 exchange rate of $1 = C$1.43.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Net income reflects the effects of changes in accounting policies. See
note 2 to CP Ships most recent annual financial statements.                                                                                                                                                              

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|(3) |  | Earnings per Common Share is calculated after deduction of preference
dividends in the years ended 31st December 2001, 2000 and 1999 of $3
million, $2 million and $0, respectively. Basic and diluted earnings per
Common Share have been calculated using net income after deducting
preference shares divided by 79.3 million and 79.9 million shares,
respectively, for the year ended 31st December 2001. For periods prior to
1st October 2001, basic and diluted earnings per Common Share have been
restated using 79.1 million and 79.2 million Shares, respectively, which is
the number of Common Shares and options outstanding immediately after the
Spin-off of CP Ships from CPL on 1st October 2001.
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




SELECTED QUARTERLY FINANCIAL INFORMATION

Reference is made to page 29 of CP Ships 2001 Annual Report, which is
incorporated by reference in this Annual Information Form.




MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

Reference is made to the section entitled Managements Discussion and
Analysis set out at pages 16 to 27 of CP Ships 2001 Annual Report, which is
incorporated by reference in this Annual Information Form.




MARKET FOR SECURITIES

Stock Exchange Listings

The Common Shares are traded on the Toronto Stock Exchange and the New
York Stock Exchange and trade under the symbol TEU.




DIVIDEND POLICY

On 16th April 2002, CP Ships Board of Directors declared a dividend for
the first quarter of 2002 of $0.04 per Common Share ($3 million in aggregate),
which was paid on 15th May 2002. On 24th January 2002, the Board of Directors
declared a dividend for the fourth quarter of 2001 of $0.04 per Common Share
($3 million in aggregate), which was paid on 22nd February 2002.

The Board of Directors presently anticipates that CP Ships will continue
to pay quarterly dividends in the amount of $0.04 per Common Share out of funds
or property of CP Ships properly available for that purpose. The anticipated
amount of the quarterly dividend is based on the current view of the Board of
Directors of anticipated net income in light of current operating conditions
for CP Ships and in accordance with CP Ships capital expenditure and working
capital needs as well as its strategic spending plans. Should this view change,
the amount of the dividend could be increased, decreased or eliminated
entirely.

The Board of Directors is under no obligation to declare dividends and the
declaration of dividends is wholly within its discretion. Restrictions under CP
Ships existing or future financing agreements and the provisions of applicable
law preclude, or may preclude, the payment of dividends in certain
circumstances.




DIRECTORS AND SENIOR OFFICERS

The following are the names and municipalities of residence of the
individuals who are CP Ships directors and senior officers, their positions
and principal occupations within the past five years. Each of the directors has
served in that capacity since 1st October 2001 and will serve his term in
office until CP Ships annual meeting in 2003.

31



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##### Table of Contents



Directors

Viscount Weir, Glasgow, Scotland

Viscount Weir, Chairman of CP Ships, is also Chairman of Balfour Beatty,
one of the United Kingdoms largest construction companies, where he has been a
Director since 1977. He was Chairman of The Weir Group, a UK-based mechanical
engineering group, from 1983 to 1999. He is also a Director of St Jamess Place
Capital and Canadian Pacific Railway Company. He was formerly a Director of the
Bank of England, British Steel and, from 1989 to 2001, CPL. Viscount Weir is a
member of the Audit and Corporate Governance Committees and is Chairman of the
Compensation Committee.

John Bowmer, Atherton, California

John Bowmer is now Chairman of Adeco of Switzerland, the worlds largest
international staffing and recruitment company, having been Chief Executive
Officer since 1996 and Chief Executive Officer of its predecessor, Adia SA,
from 1993. He has served in a variety of executive positions in the United
Kingdom, Asia, Australia and the U.S. since he joined Adia SA in 1987. John
Bowmer is a member of the Audit, Compensation and Corporate Governance
Committees.

Robert Clanin, Alpharetta, Georgia

Robert Clanin was Chief Financial Officer of United Parcel Service, the
U.S. based, international parcel delivery and logistics company, from 1994 to
2000, having joined the company in 1971. He oversaw what was at that time the
largest initial public offering of stock in the United States. He is, since
2000, Chairman of Overseas Partners Limited, a Bermuda reinsurance company and
a Director of Caraustar Industries Inc., which produces recycled packaging.
Robert Clanin is a member of the Audit, Compensation and Corporate Governance
Committees.

Peter Dey, Toronto, Ontario

Peter Dey was the Chairman of Morgan Stanley Canada from 1998 until 2001
and its President from 1994. From 1985 to 1994 he was a partner in the Canadian
law firm of Osler, Hoskin & Harcourt which he first joined in 1969 and to which
he returned as a partner in 2001. He was Chairman of the Ontario Securities
Commission from 1983 to 1985 and was responsible for the Dey Report on
corporate governance in Canada. Peter Dey is a member of the Audit and
Compensation Committees and Chairman of the Corporate Governance Committee.

Frank Halliwell, Tampa, Florida

Frank Halliwell was appointed Chief Operating Officer of CP Ships in 2001,
having been Executive Vice President since 1995. He has filled a number of
senior roles in the CP Ships group since joining Canada Maritime in 1991. He
entered the container shipping industry in 1971.

John McNeil, Toronto, Ontario

John McNeil was Chairman and Chief Executive Officer of Sun Life Assurance
Company of Canada from 1988 to 1998 and Chairman until 1999. He is a Director
of Sun Life Financial Services of Canada. He serves as Chairman of Fairmont
Hotels and Resorts having been a Director of its former parent company,
Canadian Pacific Limited, from 1992 to 2001. He is also a Director of Shell
Canada, Hampton Re Holdings and DWL Inc. He is Chairman of the Audit Committee
and a member of the Compensation and Corporate Governance Committees.

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##### Table of Contents



Ray Miles, London, England

Ray Miles joined CP Ships in 1988 as Chief Executive Officer. He has been
involved in the shipping industry since 1972. He is a non-executive Director of
the West of England P&I Club, Chairman of the World Shipping Council, the liner
industrys U.S. lobby, and a trustee of the National Maritime Museum at
Greenwich, London.

Nigel Rich, London, England

Nigel Rich spent 20 years with the Jardine Matheson Group in Asia and was
its Chief Executive from 1989 to 1994. He is currently Chairman of the Hampton
Group, a real estate services company, Deputy Chairman of Exel, the global
logistics business and a Director of retailer Harvey Nichols, television
company Granada and Pacific Assets Trust. Nigel Rich is a member of the Audit,
Compensation and Corporate Governance Committees.

Ian Webber, Kent, England

Ian Webber, a Chartered Accountant, was appointed Chief Financial Officer
of CP Ships in 1996 after 17 years with PricewaterhouseCoopers LLP, the last
five as an audit partner.

Senior Officers

Terry Burrows, Sussex, England, Senior Vice-President, appointed in August
2000. He joined CP Ships in 1964 and has served in various senior commercial
and marketing roles. He was appointed Chief Executive Officer of Cast in 1998
and subsequently Executive Vice-President for Europe trades with Americana
Ships in Tampa, Florida.

David Halliday, Suffolk, England, Senior Vice-President since January
2000, joined Contship Containerlines in 1980, and served in various marketing
and commercial roles until his appointment as Chief Executive Officer in 1998.

Jeff Drake, London, England, Vice-President, Corporate Planning, joined CP
Ships in October 2000. From 1998, he was Director, Marketing and Planning for
Contship Italia, in Italy and before that a Transportation Group Partner with
Mercer Management Consulting in Boston, Massachusetts.

John Irving, Surrey, England, Vice-President, General Counsel and
Secretary, joined CP Ships in June 2001 after five years as Senior
Vice-President and General Counsel for Dairyworld Foods in Vancouver, British
Columbia. He was Vice-President, General Counsel and Secretary of Emco Limited
from 1993 to 1996.

Jeremy Lee, Quebec City, Canada, Vice-President, Investor Relations since
June 2001, joined CP Ships in 1989 and has served in various senior commercial,
marketing and corporate planning roles in Canada, the U.S. and the U.K.

Paul Stone, Essex, England, Vice-President, Human Resources, was appointed
in November 1999 after serving as General Manager, Human Resources for Contship
Containerlines since 1996. Immediately prior to joining Contship, Mr. Stone
served as UK Human Resources Manager for Deloitte & Touche and previously in
similar roles in other UK-based companies.

Iain Torrens, London, England, Vice-President, Treasurer, was appointed in
January 2002. He served in a number of treasury roles for Cookson Group from
1998 to 2002, most recently as Deputy Group Treasurer from 2000 to 2002. He was
Group Treasury and Tax Manager for Lee Cooper Group from 1996 to 1998.

33



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##### Table of Contents



Shareholdings of Directors and Senior Officers

As at 17th May 17 2002, the directors and senior officers, as a group,
beneficially owned, either directly or indirectly, or exercised control over
less than 5% of the Common Shares.

Committees of the Board



| |                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------
| | Audit Committee:John McNeil (Chairman), Viscount Weir, John Bowmer,
Robert Clanin, Peter Dey and Nigel Rich.                
|
| | Corporate Governance Committee: Peter Dey (Chairman), John McNeil,
Viscount Weir, John Bowmer, Robert Clanin and Nigel Rich.
|
| | Compensation Committee: Viscount Weir (Chairman), John McNeil, John
Bowmer, Robert Clanin, Peter Dey and Nigel Rich.        




ADDITIONAL INFORMATION

When the securities of CP Ships are in the course of distribution under a
preliminary short form prospectus or a short form prospectus, copies of the
following documents may be obtained upon request from the Secretary, CP Ships
Limited, 62-65 Trafalgar Square, London, WC2N 5DY, United Kingdom:



| | (i)   |  | one copy of the Annual Information Form, together with one copy of
any document, or the pertinent pages of any document, incorporated by
reference in the Annual Information Form;                                                                                                                                                                                                                
| | ----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (ii)  |  | one copy of the comparative financial statements of CP Ships for its
most recently completed financial year for which financial statements
have been filed together with the accompanying report of the auditor and
one copy of the most recent interim financial statements of CP Ships that
have been filed, if any, for any period after the end of its most
recently completed financial year;
|
| | (iii) |  | one copy of the information circular of CP Ships in respect of its
most recent annual meeting of shareholders that involved the election of
directors or one copy of any annual filing prepared instead of that
information circular, as appropriate; and                                                                                                                                         
|
| | (iv)  |  | one copy of any other documents that are incorporated by reference
into the preliminary short form prospectus or the short form prospectus
and are not required to be provided under clauses (i), (ii) or (iii).                                                                                                                                                                                  

At any other time, one copy of any documents referred to in clauses (i),
(ii) and (iii) will be provided upon request, provided that CP Ships may
require the payment of a reasonable charge if the request is made by a person
or company who is not a security holder of CP Ships.

Additional information including directors and officers remuneration and
indebtedness, principal holders of CP Ships securities, options to purchase
securities and interests of insiders in material transactions, if applicable,
is contained in the CP Ships information circular for its most recent annual
meeting of shareholders that involved the election of directors. Additional
financial information is provided in CP Ships comparative financial statements
for the year ended 31st December 2001.

34