Author: Consultant

Metro Inc. MRU-T +1.23%increase has reported a jump in both sales and profits in its third quarter, as a strike among its roughly 3,700 Toronto-area grocery workers continues for a second week.The Montreal-based retailer reported on Wednesday that adjusted profits grew by more than 10 per cent in the quarter, as inflation pushed prices higher and shoppers looking for deals visited its discount stores more often, pushing sales up.“Inflation is tough. People are searching for value in all our stores, on all of their trips,” Metro chief executive officer Eric La Flèche said on a conference call to discuss the results.Metro’s net earnings grew to $346.7-million or $1.49 per share, compared with $275-million or $1.14 per share in the same period the prior year. According to the company, that 26.1-per-cent jump in profits was partly accounted for by a one-time favourable adjustment on a tax benefit. Not including that $40.7-million benefit, Metro’s adjusted net earnings grew by 10.9 per cent.There are signs inflation is moderating: Metro received 40-per-cent fewer price-increase requests in the third quarter than it did in the same period last year, Mr. La Flèche said. But the size of those requests is still above normal levels, he added, with suppliers asking for percentage increases in the mid- to high-single digits, on top of double-digit increases put forward in 2022.Like other retailers, Metro executives say that while prices on shelves have been going up, they do not entirely pass on the cost increases received from suppliers.“We are absorbing part of the cost increases,” Mr. La Flèche said. “… There are limits to what we can charge to our customers.”Metro has been gaining market share amid higher traffic to its discount stores such as Food Basics and Super C, Mr. La Flèche said. Metro’s sales grew by 9.6 per cent to $6.4-billion in the third quarter.Same-store sales – an important industry measure that tracks sales growth not tied to new store openings – grew by 9.4 per cent at Metro’s grocery stores and rose 5.9 per cent at its drugstores such as Jean Coutu. Metro’s online grocery sales nearly doubled in the quarter compared with last year, largely because of partnerships the company has struck with other food-delivery companies.Food inflation has remained stubbornly high, even as the rate of overall inflation has slowed significantly. Food prices rose by 9.1 per cent year-over-year in June, once again outpacing the general rate of inflation at 2.8 per cent.Metro’s internal measure of food inflation was roughly 8 per cent, a deceleration in price hikes compared with its previous quarter. The company’s “food basket inflation” metric is based on prices for a basket of goods frequently purchased at its stores, and does not measure the same set of products as the Consumer Price Index tracked by Statistics Canada.Metro donates perishables to food banks as workers strike citing affordability issuesWorkers at Metro have raised concerns that their pay has not risen adequately, even as inflation has sharply increased the cost of living and grocers have reported increases in profits. In the Greater Toronto Area, 27 Metro stores remain closed amid the strike. A one-week labour dispute last year with Metro’s distribution-centre employees in Toronto cost the company $7.7-million.Metro announced on July 19 that it had reached a tentative agreement with Unifor Local 414, which represents the workers, and that the union’s bargaining committee had unanimously recommended the deal. However, workers rejected the four-year agreement, which included wage increases above inflation, and have been on strike since July 29.“Front-line grocery workers deserve their fair share of Metro’s record profits,” said a Unifor statement provided by spokesperson Paul Whyte on Wednesday. “Thirty-seven-hundred Metro workers remain focused on achieving a fair collective agreement that addresses the significant affordability challenges they face.”On Wednesday’s call, Mr. La Flèche also addressed a continuing investigation by the Competition Bureau into an alleged industry-wide scheme to inflate the price of bread in Canada. Metro is among the retailers, which have denied wrongdoing, under investigation. In June, one of the country’s largest bread producers, Canada Bread, agreed to pay a record $50-million fine to settle its part in the case.“Let me be clear. We have not participated in any price-fixing agreements, and we have not violated the Competition Act,” Mr. La Flèche said Wednesday.A court document related to the investigation included a screenshot of a 2007 e-mail in which Maple Leaf Foods’s former chief executive, Michael McCain, described a conversation with then-Metro employee Paul del Duca in which they discussed “the strategy of managing category profit up in the retail environment.” Maple Leaf controlled Canada Bread at the time.“Consistent with the position that he took on the last bread price increase, his point of view (and it is a very vigorous point of view) is that this is an acceptable strategy and they are aligned with it even in our meat categories,” Mr. McCain wrote in the e-mail, which was sent from the account of his executive assistant at the time, Sue Perkins.Maple Leaf has denied any involvement in the alleged bread price fixing, and denied that the e-mail suggested any knowledge of or involvement in improper activity.A class-action lawsuit is seeking certification in Quebec over alleged price fixing in the meat category. Mr. La Flèche said on Wednesday that the company will “vigorously” oppose certification.“Allegations that the food industry’s culture is such that these practices may be generalized, or that the governance is somehow deficient, are simply not true, damage the reputation of our company, all its employees and the industry, and should stop,” Mr. La Flèche said.

Nuvei Corp. NVEI-T -39.43%decrease, which processes digital payments and is one of Canada’s best-known financial technology companies globally, watched its shares plummet 39 per cent to a record low Wednesday after slashing its revenue outlook for the rest of the fiscal year – and for the near future.Nuvei’s shares, which closed at $24.30 Wednesday, are now down 86 per cent from their pandemic peak, echoing a similar fall from grace by industry peer – and Canada’s own – Lightspeed Commerce Inc LSPD-T -1.19%decrease.Founded in Montreal in 2003, Nuvei manages payments across a variety of sectors, including online retail and travel, but its largest block of revenue comes from online gambling and sports betting companies. The company was worth more than $20-billion at the height of the pandemic stock market bubble, but like many technology stocks, Nuvei’s share prices started to tumble in the fall of 2021.After a deep sell-off, the shares seemed to stabilize in recent months and Nuvei started marketing itself globally as a leading payments player, signing a multiyear sponsorship agreement in February with the Mercedes-AMG PETRONAS Formula One team. Its logo is now front and centre on driver Lewis Hamilton’s helmet.Two months later, in April, Canadian actor and budding businessman Ryan Reynolds publicly announced that he had invested in the company and formed a creative partnership with Nuvei, though details were scarce.None of that has benefited Nuvei’s shares in the near term. It hasn’t helped that in late April, short seller Spruce Point Capital Management bet against its stock and publicly criticized the company. Before Wednesday’s earnings report, Nuvei’s shares had fallen 28 per cent since the short-seller report was released.As for the latest earnings, not only were Nuvei’s quarterly earnings lower than expectations, with adjusted earnings 15 per cent lower than analyst estimates, but the company trimmed its revenue outlook for the second half of the fiscal year and also lowered its medium-term sales guidance to 15 per cent to 20 per cent annually, down from more than 20 per cent annually.Nuvei attributed the slower growth to longer-than-anticipated lag times in connecting new clients to its technology platform once they’ve signed contracts, as well as a decision to end its relationship with a top 10 client for reasons that were not disclosed.Asked on a conference call why the client was cut off, chief executive officer Philip Fayer would only say the unnamed company “was no longer a fit for Nuvei.”Before Wednesday’s slump, Nuvei’s shares had also struggled because of a sector-wide chill after the sale of industry giant WorldPay in July. The company was acquired by Jacksonville, Fla.-based Fidelity National Information Services Inc. at a US$43-billion valuation in 2019, a time when payments companies were garnering extremely frothy valuations.Fidelity National recently took a US$17.6-billion writedown on the business and also sold 55 per cent of it at a valuation that was less than half what it had originally paid.The sale price amounted to only 9.8 times expected earnings before interest, taxes, depreciation and amortization in fiscal 2023, and the low multiple has limited the valuations of some rivals.

• Normalized Earnings per Share¹ up 55.4%;
• Sales up 28.8% to $2.55 billion, a new record for a quarter;
• Diversified strategy validated with Industrial earnings tripling over prior year, anchoring solid overall performance;
• Normalized Operating Earnings¹ up 54.7%;
• New business wins take launch book to nearly $4.5 billion;
  • 58% of wins for electrified vehicles (“EV”);
• Sales up 54.0% for Industrial due to strong markets in both agricultural and access equipment and solid market share growth notably in our core agricultural products;
• Sales up 20.2% for Mobility driven largely by launching programs;
• Acquisition of Dura Shiloh’s battery enclosure business closed and will drive strong battery electric vehicle CPV growth;
• Linamar Structures Group created to drive rapidly growing propulsion agnostic business; and

https://www.newswire.ca/news-releases/q2-2023-another-stellar-quarter-at-linamar-with-exceptional-earnings-growth-record-revenues-and-continued-free-cash-flow-820313740.html

Oil hit new peaks on Wednesday with Brent crude touching the highest price since April, as tighter supply owing to Saudi and Russian output cuts offset concerns over slow demand from China and a report showing rising U.S. crude inventories.Top exporter Saudi Arabia last week extended its voluntary production cut of 1 million barrels per day for another month to include September, and Russia said it would cut oil exports by 300,000 bpd in September.“The latest recovery is mainly driven by the pledge of major producers, like Saudi Arabia and Russia, to keep supply subdued for another month,” said Charalampos Pissouros, senior investment analyst at broker XM.Brent crude was up $1.00, or 1.2%, having touched $87.24, the highest price since April 13. U.S. West Texas Intermediate (WTI) crude gained 80 cents, or 1.0%, to $83.72. The U.S. benchmark touched $84.11, the highest price since November 2022.

https://www.cnbc.com/2023/08/09/oil-prices-slip-as-bearish-china-data-fuels-demand-concerns.html

Franco-Nevada Corp. (FNV) on Tuesday reported second-quarter earnings of $184.5 million.The Toronto-based company said it had net income of 96 cents per share. Earnings, adjusted for non-recurring gains, came to 95 cents per share.The results exceeded Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of 83 cents per share.The precious metals streaming and royalty company posted revenue of $329.9 million in the period._____This story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on FNV at https://www.zacks.com/ap/FNV

• Base earnings¹ EPS of $0.99 or $920 million increased by 2% or $17 million from a year ago.
• Net earnings EPS of $0.53 or $498 million; includes ($0.30) or ($279 million) of losses associated with strategic business portfolio repositioning and surplus asset rebalancing.
• Executed strategic actions to reposition the portfolio for sustained growth.

https://www.newswire.ca/news-releases/great-west-lifeco-reports-second-quarter-2023-results-895730978.html

2023 THIRD QUARTER HIGHLIGHTS

• Sales of $6,427.5 million, up 9.6%
• Food same-store sales⁽¹⁾ up 9.4%
• Pharmacy same-store sales⁽¹⁾ up 5.9%
• Net earnings of $346.7 million, up 26.1%, and adjusted net earnings⁽¹⁾ of $314.8 million, up 10.9%
• Fully diluted net earnings per share of $1.49, up 30.7%, and adjusted fully diluted net earnings per share⁽¹⁾ of $1.35, up 14.4%

https://www.newswire.ca/news-releases/metro-reports-2023-third-quarter-results-856007784.html

Hydro One Ltd. H-T +0.61%increase says second-quarter earnings ticked up four per cent compared to a year ago.In the three months ended June 30, the power utility says net income attributable to common shareholders rose to $265 million from $255 million in the same period a year earlier.Hydro one is reporting second-quarter revenues that inched up by one per cent to $1.86 billion versus $1.84 billion a year earlier.It says diluted earnings increased to 44 cents per share from 42 cents per share, above analyst expectations of level year-over-year diluted earnings, according to financial markets data firm Refinitiv.Hydro One attributed its boost in profits to a hike in 2023 transmission rates and lower asset removal costs due to fewer storm-related replacements, and despite higher operations and maintenance costs.The quarter also saw the company break ground on a transmission line between its switching stations in the municipality of Chatham-Kent and the Lakeshore municipality in southwestern Ontario that looks to supply clean electricity to the agri-food and manufacturing sectors.

Sun Life FinancialSLF-T -0.73%decrease reported a rise in second-quarter profit on Tuesday, helped by its acquisition of U.S. dental benefits provider Dentaquest and strong insurance sales at home.Sunlife has been diversifying its business across the globe and expanded its U.S. footprint with the acquisition of Dentaquest last year. At home, the company is buying Canadian virtual healthcare and wellness platform Dialogue.chief executive officer Kevin Strain said health and protection sales growth were strong in the quarter and its investment in Dialogue would help the Toronto-based company play a larger role in Canada’s health ecosystem, while reducing the strain on traditional health care organizations.The Toronto-based insurance and asset management company said earnings from its group insurance segment surged 51% while individual insurance business rose 23%.Earnings from wealth and asset management segment fell 1% largely due to higher expenses and lower fee-based earnings.The insurer posted underlying net income of C$920 million ($685.54 million), or C$1.57 per share, for the three months ended June 30, compared with C$808 million, or C$1.38 per share, a year earlier.