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Total revenue of $230.2 million grew 25% year-over-year and annual revenue exceeded previously-established outlook

Net loss and Adjusted EBITDA¹ improved to ($32.5) million and $4.4 million, respectively

Read more at newswire.ca

HALIFAX, Nova Scotia, May 13, 2024–(BUSINESS WIRE)–Today Emera (TSX: EMA) reported 2024 first quarter financial results.

Summary

• Quarterly adjusted earnings per share (“EPS”) ⁽¹⁾ of $0.76 decreased $0.23 or 23% compared to $0.99 in Q1 2023. The primary drivers of this change are:
  • the impact of milder weather at Tampa Electric during the quarter;
  • lower contributions from New Mexico Gas Company’s (“NMGC”) asset management agreements, which were very strong in Q1 last year;
  • lower earnings at Nova Scotia Power (“NSPI”) due to an increase in OM&G costs focused on reliability and customer experience, as well as a one-time regulatory disallowance;
  • lower contributions from marketing and trading at Emera Energy Services (“EES”), which had a very strong Q1 last year;
  • higher corporate costs due to mark-to-market losses related to long-term compensation-related hedges;
  • partially offset by higher contributions from Peoples Gas (“PGS”), which benefited from new rates and strong customer growth – delivering its highest quarterly earnings ever.
    
• Quarterly reported net income decreased by $353 million to $207 million compared to $560 million in Q1 2023 and quarterly reported EPS decreased by $1.34 to $0.73 from $2.07 in Q1 2023. Both decreases were primarily due to mark-to-market (“MTM”) gains at EES in 2023.

“While weather and an unusually strong prior-year quarter contributed to lower comparative adjusted earnings for the quarter, our core utilities remain on track to deliver solid earnings results for the full year,” said Scott Balfour, President and CEO of Emera Inc. “We remain confident in the underlying forward-looking growth profile of our business, driven in large part by our two operations in Florida. Peoples Gas is on track to become our second largest earnings contributor in 2024, behind Tampa Electric. Together, our Florida businesses have delivered significant growth in earnings over the last five years, and we expect the drivers of this growth to continue.”

China’s consumer prices rose for a third straight month in April, while producer prices extended declines, signalling an improvement in domestic demand, as Beijing navigates challenges in its bid to shore up a shaky economy.

The closely watched numbers follow better-than-expected imports data for April, suggesting a flurry of policy support measures over the past several months may be helping consumer confidence.

Consumer prices edged up 0.3 per cent in April from a year earlier, data from the National Bureau of Statistics showed on Saturday, versus a rise of 0.1 per cent in March and a Reuters poll forecast for an increase of 0.2 per cent.

“Strip out food and energy prices, and the consumer inflation data suggests a comeback in demand, especially in services,” said Xu Tianchen, senior economist at the Economist Intelligence Unit.

Core inflation, excluding volatile food and fuel prices, grew 0.7 per cent in April, up from 0.6 per cent in March.

Overall the consumer price index (CPI) rose 0.1 per cent from the previous month, beating a forecast fall of 0.1 per cent in the poll and reversing a drop of 1 per cent in March.

Most China watchers say Beijing still has its work cut out, though, and the momentum might prove unsustainable, as official surveys show cooling factory and services activity, while a lengthy housing crisis shows no sign of easing, boosting the case for more policy support.

“Price hikes by utility companies is another potential driver,” Xu added.

“The fiscal strains some local governments are facing affect the subsidies they receive, which could be forcing them to pass the extra cost on to households to make ends meet.”

Officials are grappling with municipal debt of $13-trillion, and the State Council, or cabinet, has told heavily indebted local governments to delay or halt some state-funded infrastructure projects.

“The prices data suggests that domestic demand is recovering, supply and demand continues to improve and the outlook for domestic demand and price recovery is optimistic,” said Zhou Maohua, a macroeconomic researcher at China Everbright Bank.

“However, consumer prices remain low and the industrial manufacturing sector is still under pressure, reflecting insufficient effective demand and that recovery in the sector is still not sufficiently balanced.”

The producer price index (PPI) dropped 2.5 per cent in April from a year earlier, easing from a slide of 2.8 per cent the previous month but extending a 1-1/2-year-long stretch of declines.

On Friday, China’s central bank said it would make monetary policy flexible, precise and effective and promote a moderate recovery in consumer prices to consolidate economic recovery.

The comments in a quarterly monetary policy report follow remarks in April by the Politburo, a top-decision making body of the ruling Communist Party, that China will use policy tools, such as banks’ reserve requirement ratio (RRR) and interest rates, to prop up growth.

“Considering the judgment of the Politburo meeting that ‘effective demand is still insufficient …’ the policy support should take advantage of the momentum, by strengthening expectation management and creating more consumption scenarios,” said Bruce Pang, chief economist China at Jones Lang LaSalle.

Many analysts say China’s economic growth target of about 5 per cent in 2024 will be a challenge to achieve without further policy support.

Premium Brands Holdings Corp. PBH-T +4.54%increase reported a first-quarter profit of $6.3-million, up from $5.9-million in the same quarter last year.

The specialty food company says the profit amounted to 14 cents per diluted share for the 13-week period ended March 31, up from 13 cents per diluted share a year earlier.

Revenue for the quarter totalled $1.46-billion, up from $1.43-billion in the first quarter of 2023.

The increase came as specialty food revenue rose to $987.4-million, up from $948.8-million a year ago, while premium food distribution revenue totalled $474.4-million, down from $481.7-million a year earlier.

On an adjusted basis, Premium Brands says it earned 54 cents per share in its latest quarter, down from an adjusted profit of 64 cents per share in the same quarter last year.

Premium Brands owns a range of specialty food brands as well as food distribution businesses across Canada and the United States.

Exploring a potential purchase of the Trans Mountain oil pipeline is not a major priority right now for Pembina Pipeline Corp. PPL-T +0.46%increase, the Calgary-based company said.

On a conference call with analysts to discuss first-quarter financial results, Pembina’s chief financial officer Cameron Goldade acknowledged the recent completion of the $34 billion Trans Mountain expansion, which marked its official opening last week.

But he reiterated Pembina’s previously stated stance that there are still too many questions surrounding the pipeline to support pursuing a purchase at this point.

“From our perspective, there still exists a tremendous amount of uncertainty around that asset. And so you know, frankly, nothing has changed from our prior messaging in terms of that as an investment opportunity,” Mr. Goldade said on Friday.

“It’s not something we’re spending a great deal of time on right now.”

Pembina formed a partnership in 2021 with Western Indigenous Pipeline Group for the purpose of pursuing an Indigenous-led equity stake in Trans Mountain.

The pipeline is currently owned by the federal government, which bought it in 2018 to get the expansion project over the finish line.

But the government has said it does not wish to be the long-term owner and has already launched the first of what is expected to be a two-phase divestment process.

Pembina is not eligible to participate in this first phase, which involves talks with more than 120 Indigenous nations located along the Trans Mountain route to see if any of them are interested in an equity stake.

The second phase, for which the timing is unclear, will involve the consideration of commercial offers.

Some analysts have suggested Pembina would be the most logical buyer for the 890,000-barrel-a-day pipeline, which opens up new global export markets for Canadian oil companies.

But during the course of the four years it took to construct the megaproject, the pipeline expansion ran into multiple regulatory snags, delays and budget overruns.

And even though the project is complete, the Crown corporation that built it is still locked in a dispute with oil companies over the tolls it wishes to charge to use the pipeline.

Tolls are the way a pipeline earns revenue, so the final tolling structure for Trans Mountain will directly affect the pipeline’s value as well as the price a prospective buyer is willing to pay.

Trans Mountain is looking to charge higher tolls to offset some of the project’s budget overruns, but oil companies don’t want to be held responsible for construction-related challenges.

The Canada Energy Regulator has approved Trans Mountain’s proposed higher tolls on an interim basis to ensure a tolling structure was in place for the start-up of the pipeline, but it has yet to make a final decision.

Pembina’s comments on Trans Mountain came one day after the company announced it earned $439-million in the first quarter, up from $369-million a year earlier.

Pembina said its revenue for the quarter ended March 31 was $1.54-billion, down from $1.62-billion during the same quarter last year.

Diluted earnings per common share were 73 cents, up from 61 cents.

During the quarter, Pembina entered into long-term agreements with Dow Chemical to supply and transport up to 50,000 barrels a day of ethane to support the recently announced construction of Dow’s new integrated ethylene cracker and derivatives facility in Fort Saskatchewan, Alta.

Pembina and its project partner, the Haisla Nation of B.C., also announced recently that they have achieved a number of positive milestones on Cedar LNG, a proposed floating liquefied natural gas facility to be built near Kitimat.

Pembina said a final investment decision on Cedar LNG will be made by June, 2024.

Canada’s second-largest insurer missed analysts’ expectations after its first-quarter earnings were hit by higher morbidity claims, the sale of its U.K. business and the end of the public-health emergency in the United States.

Sun Life Financial Inc. SLF-T -6.70%decrease reported “underlying” net income of $875-million, or $1.50 a share, for the first three months of the year, down from $895-million, or $1.52 a share, in the same period last year. Underlying net income strips out investment losses and makes other accounting adjustments. Analysts had expected income of $1.65 a share, according to LSEG data.

Shareholders drove Sun Life’s shares down almost 5 per cent on Friday morning trading to as low as $69.04 on the Toronto Stock Exchange.

Chief executive officer Kevin Strain attributed the missed earnings mostly to the higher number of morbidity claims in the United States – more individuals contracting certain illnesses – as well as lower sales in DentaQuest, a Sun Life subsidiary that is one of the largest providers of U.S. Medicaid dental benefits.

“Our U.S. dental business continued to experience negative impacts from the end of the public-health emergency driven by Medicaid member disenrollment and higher claims ratios on the remaining members,” Mr. Strain told analysts Friday.

During the pandemic, the government could not disenroll people from Medicaid. Individuals were automatically re-enrolled, even if they were no longer eligible. That came to an end in May, 2023. Since then, Sun Life has seen a bump in disenrollment in Medicaid membership across multiple states, affecting its overall DentaQuest business. Sun Life U.S. president Dan Fishbein told analysts the government’s disenrollment is expected to be complete by the end of June.

“That’s a 14-month process by regulation,” Mr. Fishbein said during an earnings call. “So, there likely are some additional membership declines still in progress and still ahead of us. The primary result that’s affecting our results is not just the membership itself, but the fact that those who were no longer eligible for coverage were utilizing care at a meaningfully lower rate than those who remained in the programs.”

The impact on earnings should lessen as individual states begin to adjust their Medicaid rates, which is mostly done on an annual basis, Mr. Fishbein added. Already, about 25 per cent of the contracts have new rates established, with the remaining 75 per cent to be done by the end of the year.

Mr. Strain said he expects dental results to return to prior levels of profitability and “be more consistent” with pricing targets. He expects income levels for dental to be about US$100-million for 2025, a target the insurer had originally wanted to hit in 2024.

Outside the U.S., the insurer also saw a drop in net income from individual insurance sales, down about $13-million overall for the quarter. The decline was driven by lower earnings after the sale of Sun Life UK in 2023, but offset by stronger sales in Asia, which were up $38-million for the quarter.

Sun Life Asia reported positive results for the quarter, with underlying net income of $177-million, up 26 per cent year-over-year. The region continues to see strong sales momentum for both wealth and insurance in Hong Kong after a period of prolonged pandemic lockdowns. Other regions such as Vietnam, Indonesia, China and India experienced slower insurance sales, but Mr. Strain said in an interview that he anticipates those markets to rebound.

“Vietnam and Indonesia are two regions that had the most negative impact for us this quarter,” he added. “But we are working our way through those and we feel long-term that those are both really good markets.”

Sun life’s results are in contrast with those of Canada’s largest insurer, Manulife Financial Corp., which on Wednesday reported a jump in its first quarter “core earnings” of $1.75-billion, or 94 cents a share, compared with $1.53-billion or 79 cents a share in the first quarter of 2023.

The boost in earnings, which beat analysts’ expectations of 91 cents per share, according to LSEG data, was largely owing to Manulife’s continued strength in Asia.

“We generated 44 per cent of earnings from the Asia region,” Manulife chief financial officer Colin Simpson said during a call Thursday. “As you can see, Asia continues to play a pivotal role in our earnings growth.”

 Sun Life Financial Inc. (SLF) on Thursday reported first-quarter net income of $621.6 million.

The Toronto-based company said it had net income of $1.04 per share. Earnings, adjusted for non-recurring costs, came to $1.11 per share.

The results did not meet Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of $1.20 per share.

The financial services company posted revenue of $5.1 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 SLF at https://www.zacks.com/ap/SLF

Gold prices climbed higher on Friday amid bets the Federal Reserve will cut interest rates in September, after data showed a bigger than expected increase in U.S. jobless claims last week.

The dollar index, which dropped to 105.14 around mid morning, swiftly rebounded to 105.40 before paring some gains. The index was last seen at 105.31, up marginally from the previous close.

Gold futures for May ended higher by $35.20 or about 1.51% at $2,367.30 an ounce. Gold’s gain today was the biggest single session gain in dollar as well as percentage terms in more than a month.

Gold futures gained nearly 3% in the week.

Silver futures for May ended higher by $0.143 or about 0.51% at $28.275 an ounce. Silver futures gained nearly 7% in the week.

Copper futures climbed to around $4.6600 per pound, gaining $0.0750 or about 1.6%.

There is renewed optimism for rate cuts after Sweden’s central bank lowered its key interest rate for the first time in more than eight years and Bank of England (BoE) Governor Andrew Bailey hinted at potential future rate cuts.

U.S. consumer and producer price inflation data due next week are now pivotal for the Federal Reserve’s higher-for-longer rate strategy.

Federal-funds futures currently show traders expect the Fed to start lowering its benchmark interest rate in November though there remains a chance of a cut in September.

In economic news today, a report released by the University of Michigan showed a substantial deterioration in U.S. consumer sentiment in the month of May.

The University of Michigan said its consumer sentiment index plunged to 67.4 in May from 77.2 in April. Economists had expected the index to edge down to 76.0.

With the much steeper than expected drop, the consumer sentiment index tumbled to its lowest level since hitting 61.3 last November.