Business News
May 9, 2008MONTREAL - Soaring fuel prices that have battered airline valuations will likely delay the sale of ACE Aviation Holdings majority stake in Air Canada (TSX:AC.A), says Robert Milton, the chairman and chief executive of the holding company (TSX:ACE.B).
ACE has received a lot of interest from parties interested in buying its 75 per cent stake in Canada's largest airline, but the timing may not be right to obtain maximum return, Milton said.
MONTREAL - The cost of air travel for many Canadians surged Friday after Air Canada (TSX:AC.A) quietly imposed domestic fuel charges for the first time in four years that could, for example, add an extra $120 for a round-trip ticket across the country.
The price increases, imposed Friday, would add $120 a round-trip for flights of more than 1,001 miles, or 1,601.6 kilometres, each way. Smaller surcharges would be slapped on tickets for shorter trips.
CALGARY - Canadian Pacific Railway Ltd. (TSX:CP) is taking steps to make sure grain and other high-demand commodities flow more smoothly across the continent, the company's chief executive said Friday.
Fred Green said the railway "took away some learnings" from the past few quarters, which were beset by weather delays and other operational challenges.
TORONTO - The Toronto stock market closed lower Friday as energy stocks failed to respond to another runup in crude prices to another record breaking high, while oil prices along with a huge loss at insurer American International Group Inc. depressed New York markets.
Toronto's S&P/TSX composite index moved down 86.8 points to 14,521.19.
LONGUEUIL, Que - Federal Industry Minister Jim Prentice says lack of market access shouldn't be a reason for Canadian companies like MacDonald, Dettwiler and Associates Ltd. (TSX:MDA) to sell their businesses to foreigners.
He made the statement at the Canadian Space Agency on Friday, just hours after blocking the sale of MDA's space division to American firm Alliant Techsystems Inc.
VANCOUVER - Ottawa's confirmation it will block the $1.3-billion sale of MacDonald Dettwiler and Associates Ltd.'s (TSX:MDA) space division, coupled with a slowdown in the real estate sector where the company concentrates its other business, spells tough times ahead for the Vancouver-based firm, analysts say.
Some have slapped a "sell" rating on the stock, believing MDA's future has dimmed, while others said the company has a strong balance sheet and will simply have to tread water until it can update its business plan.
OTTAWA - The Canadian economic engine is showing signs of sputtering in the face of stiffening headwinds from the U.S. slump and ongoing tight credit conditions.
Two key economic indicators Friday - unemployment and merchandise trade - painted a picture of a somewhat resilient economy that is mostly succeeding in avoiding the outright contraction occurring in the United States, but just barely.
WASHINGTON - The U.S. trade deficit narrowed sharply in March as demand for imports fell by the largest amount since the last recession was ending. Analysts forecast that trade would continue to be one of the economy's few bright spots this year.
The March deficit totalled US$58.2 billion, down 5.7 per cent from February, the Commerce Department reported Friday. It was a much larger improvement than had been expected.
NEW YORK - Oil rose above US$126 a barrel for the first time Friday, bringing its advance this week to nearly $10, as investors questioned whether a possible confrontation between the U.S. and Venezuela could cut exports from the OPEC member. Gas prices, meanwhile, rose above an average $3.67 a gallon (or 96.6 cents a litre) at the U.S. pump, following oil's recent path higher.
On Friday, The Wall Street Journal published a report that suggested closer ties between Venezuelan President Hugo Chavez and rebels attempting to overthrow Colombia's government.
TORONTO - With its second-worst quarter behind it, GMP Capital Trust (TSX:GMP.UN), is well-positioned for future growth given its strong balance sheet, CEO Kevin Sullivan said Friday after the investment house's first-quarter revenue dropped 18 per cent.
While the GMP team was disappointed with the weak quarter, especially considering the record income it generated in the same period last year, Sullivan told the company's annual meeting "we are relatively pleased with this quarter... given the difficult market environment experienced by all investment dealers."
TORONTO - Magellan Aerospace Corp. (TSX:MAL) said Friday it earned a first-quarter profit of $2.1 million, compared with a loss of $1.7 million a year ago.
The company, which makes aircraft parts and does aircraft maintenance work, said the profit amounted to two cents per share for the three months ended March 31 compared with a loss of two cents per share a year ago.
NEW YORK - Citigroup Inc.'s new chief executive, Vikram Pandit, plans to stick with a global banking model after months of intense review - but only after shrinking the company by about one-fifth first.
The three-year game plan, revealed Friday, includes getting rid of more businesses, mortgages, real-estate operations and jobs.
CALGARY - Enerplus Resources Fund (TSX:ERF.UN), a Calgary-based oil and gas trust, reports its first quarter profits rose to $121.4 million from $107.9 million on higher output and impact of Focus Energy Trust acquisition.
The company also said it has decided to sell its stake in the Joslyn oilsands project in Northern Alberta, a development controlled and operated by French oil and gas giaant Total.
MONTREAL - Aeroplan Income Fund (TSX:AER.UN) plans to reorganize into a dividend-paying public corporation largely over concerns that it will soon lose its tax-free status by exceeding foreign ownership limits.
Aeroplan's non-resident ownership was 41 per cent as of March 31. But with ACE Aviation Holdings (TSX:ACE.B) planning to sell its remaining stake, this number is expected to rise about the 49.9 per cent foreign ownership limit.
TORONTO - The chief executive of Agnico-Eagle Mines Ltd. (TSX:AEM) says the mid-tier producer is poised for strong growth this year as more projects come on stream alongside an anticipated return to climbing gold prices.
Sean Boyd told shareholders at the annual meeting Friday that the company is on track with its plan to increase production and reserves as four of its mines begin production.
MONTREAL - Power Corporation of Canada (TSX:POW) is raising its quarterly dividend by 20 per cent, the holding company announced Friday along with its first-quarter financial report, which included higher net income despite lower investment gains
The dividend to be paid on Power Corp.'s participating preferred and subordinate voting shares will rise by 4.875 cents per share to 29 cents per share per quarter, or $1.16 on an annualized basis.
MONTREAL - Gaz Metro Limited Partnership (TSX:GZM.UN), Quebec's largest natural gas distributor, reported higher net profits in the latest quarter as the company generated higher revenues and one-time gains.
Gaz Metro said Friday it earned $120.1 million, or $1 per unit for the fiscal 2008 second quarter ended March 31. That compared with earnings of $104.3 million or 86 cents a unit for the same 2007 period.
TORONTO - Canadians need to become more involved in global issues and make their voices heard, RIM (TSX:RIM) co-chief executive Jim Balsillie said Thursday night.
Balsillie, who is himself quite active in social issues, says the world is willing to listen to Canada if it were to make itself heard.
