Author: Consultant

Air Canada AC-T +1.61%increase reported a lower second-quarter profit on Wednesday, as excess capacity in certain markets and stiff competition on international routes hurt its pricing power.

North American carriers are struggling to protect their pricing power as a rush to cash in on booming demand for summer travel left them with excess capacity, forcing them to offer discounts to fill seats.

Last month, the carrier cut its full-year core profit forecast citing a lower yield environment and competition in international markets.

Airlines are also facing heightened costs associated with labour and aircraft maintenance.

Air Canada is yet to finalize a new contract with the union representing its pilots, which might come with additional cost pressures for Canada’s largest airline.

The carrier’s profit fell to $410-million or $1.04 per share, from $838-million, or $2.34 per share, a year earlier.

The Canadian carrier’s operating revenue rose 2 per cent to $5.52-billion in the quarter ended June 30.

First Quarter Financial Highlights^1,2,3:

• GTV increased 115% year-over-year to $4.1 billion, which includes $2.3 billion from IAA.
• Total revenue increased 108% year-over-year to $1.1 billion, which includes $588.6 million from IAA.
  • Service revenue increased 147% year-over-year to $849.1 million, which includes $516.9 million from IAA.
  • Inventory sales revenue increased 28% year-over-year to $215.6 million, which includes $71.7 million from IAA.
• Net income (loss) available to common stockholders increased 384% year-over-year to $97.1 million.
• Diluted earnings (loss) per share available to common stockholders increased 289% to $0.53 per share.
• Diluted adjusted earnings per share available to common stockholders increased 58% year-over-year to $0.90 per share.
• Adjusted EBITDA increased 150% year-over-year to $331.0 million.

https://www.newswire.ca/news-releases/rb-global-reports-first-quarter-2024-results-800022493.html

• West Texas Intermediate has erased its gain for the year and Brent is now down for 2024.
• Weak economic data in the U.S. sparked a selloff in equity markets as fears grow that that a recession may be looming.
• Softness in China’s economy had already been spooking oil market traders.

https://www.cnbc.com/2024/08/05/crude-oil-prices-today.html

CALGARY, AB, Aug. 2, 2024 /CNW/ – Canadian Utilities Limited (TSX:CU.TO)

Canadian Utilities Limited (Canadian Utilities or the Company) today announced second quarter 2024 adjusted earnings of $117 million ($0.43 per share), which were $17 million ($0.06 per share) higher compared to $100 million ($0.37 per share) in the second quarter of 2023. 

Read more at newswire.ca

Magna International Inc. says its second-quarter profit tumbled from a year ago to US$328 million.

The Aurora, Ont.-based auto parts manufacturer, which keeps its books in U.S. dollars, says those earnings compared with US$354 million a year earlier.

The results for the period ended June 30 amounted to US$1.09 per diluted share compared with US$1.18 a year ago.

The company’s second-quarter sales totalled US$10.96 billion, making them almost unchanged from a year ago, when they amounted to US$10.98 billion.

The company expects to close out the year with between US$42.5 billion and US$44.1 billion in sales.

Its 2026 outlook expects sales between US$44 billion and US$46.5 billion.

This report by The Canadian Press was first published Aug. 2, 2024.

Enbridge Inc. (ENB) on Friday reported second-quarter net income of $1.42 billion.

On a per-share basis, the Calgary, Alberta-based company said it had profit of 63 cents. Earnings, adjusted for non-recurring gains, came to 42 cents per share.

The results missed Wall Street expectations. The average estimate of seven analysts surveyed by Zacks Investment Research was for earnings of 45 cents per share.

The oil and natural gas transportation and power transmission company posted revenue of $8.29 billion in the period.

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This story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on ENB at https://www.zacks.com/ap/ENB

Imperial Oil Ltd. saw a significant spike in net income in its second quarter, which reached $1.13 billion.

The Calgary-based company says those results compared with a net income of $675 million a year prior.

The increase seen in the period ended June 30 amounted to earnings of $2.11 per share on a diluted basis compared with $1.15 per share in the second quarter of 2023.

Total revenue and other income totalled $13.38 billion, up from $11.82 billion a year prior.

Imperial says production averaged 404,000 gross oil-equivalent barrels per day in the quarter, up from 363,000 a year earlier.

Refinery throughput for the quarter averaged 387,000 barrels per day, compared with 388,000 barrels per day a year prior.

This report by The Canadian Press was first published Aug. 2, 2024.

Job growth in the U.S. slowed much more than expected during July and the unemployment rate ticked higher, the Labor Department reported Friday.

Nonfarm payrolls grew by just 114,000 for the month, down from the downwardly revised 179,000 in June and below the Dow Jones estimate for 185,000. The unemployment rate edged higher to 4.3%, its highest since October 2021.

https://www.cnbc.com/2024/08/02/job-growth-totals-114000-in-july-much-less-than-expected-as-unemployment-rate-rises-to-4point3percent.html

• Exxon raises 2024 oil and gas output goal to 4.3 million bpd
• Raises capital spending guidance to $28 billion for 2024
• Aims to cut cumulative $5 billion in costs through 2027

Aug 2 (Reuters) – Exxon Mobil (XOM.N), opens new tab on Friday posted a better than expected $9.2 billion second-quarter profit based on rising oil prices and volume gains from its purchase this year of shale oil firm Pioneer Natural Resources.

Exxon delivered a $2.14 per share profit that beat analysts’ estimates on oil production and pricing gains that offset refining weakness. Results mirrored profit beats by rivals BP, Shell and ConocoPhillips.

Higher profit “was driven by record production both in Guyana and in the Permian,” which offset lower natural gas and fuel prices, Chief Financial Officer Kathryn Mikells said.

Net income was $9.24 billion, up from $7.88 billion a year ago, largely on higher oil prices and gains from asset sales that offset weaker refining earnings.

Shares were up 1.3% in pre-market trading from $116.95 on Thursday.

The company warned the Golden Pass LNG joint venture development project stalled by the lead contractor’s bankruptcy would be delayed until late 2025. Exxon owns a 30% stake in the project and had earlier expected a first-half startup.

The profit boost from the Pioneer purchase highlighted how quickly Exxon was able complete the $60 billion deal compared to rivals. Chevron and ConocoPhillips’ acquisitions are still waiting on regulatory reviews. Chevron this week indicated the closing of its Hess purchase may not happen until the second half of next year.

Exxon, a partner with Hess in Guyana, has challenged Chevron’s deal and its arbitration claim should be resolved by September 2025, Mikells told Reuters in an interview, later than Chevron has signaled.

The top U.S. oil producer raised its 2024 output target by 13% to 4.3 million barrels of oil equivalent per day (boepd) following the Pioneer deal, Mikells said. Exxon produced 3.74 million boepd in 2023.

“We already see a line of sight of greater synergies” than expected when Exxon announced the transaction, Mikells said, adding that any updates would be disclosed in December.

REFINING WEAKER

Profits from pumping oil and gas jumped 25% over a year ago to $7.1 billion while those from the company’s gasoline and diesel business fell 32% to $946 million. Chemicals profits were flat at $779 million in the quarter.

Expenses rose modestly with capital spending of $7.03 billion, including $700 million in spending on assets acquired from Pioneer, up from $6.17 billion in the same quarter a year ago.

Exxon increased its annual capital expenditure guidance to $28 billion from the previously estimated $23-$25 billion.

The results also showed higher cash flow from operations which will help fund higher share buybacks and dividends. Cash flow from operations climbed to $10.5 billion, from $9.4 billion a year ago.

The company plans to buy back $19 billion in shares this year, the largest share repurchase program among its top Western rivals, up from $17.4 billion last year.

Oil and gas production in the second quarter grew by 15% from the previous quarter, or 574,000 boepd, including the added Pioneer contribution. Exxon had anticipated that Pioneer would add 500,000-550,000 boepd of output in the quarter.

Its Guyana operations, which were expected to produce about 600,000 boepd this year with partners, posted peak production in May, with a record of 663,000 boepd.

The company plans to deliver cumulative savings of $5 billion through the end of 2027 versus 2023, including $1 billion in cost cuts during the second quarter.