Article content continued
Alberta to contribute to program covering commercial rent: Kenney
Meanwhile, Kenney said Alberta is prepared to contribute $67.2 million to the new Canada Emergency Commercial Rent Assistance (CECRA) program on top of the $267 million coming to Alberta from Ottawa.
The CECRA program will offer loans to small and medium businesses struggling during the pandemic of 50 per cent of monthly commercial rental costs for April, May and June.
The loan will be forgivable if the property owner and tenant come to a rent forgiveness agreement that lowers the eligible business’s rent by 75 per cent for the three months and includes a moratorium on eviction.
The program, administered by the Canadian Mortgage and Housing Corporation, is expected to start in mid-May.
Also announced Friday, former member of parliament James Rajotte has been named Alberta’s senior representative in Washington. Kenney said Rajotte’s job will include making sure the Keystone XL project “gets done” and to work on the coordinated North American energy strategy.
Editor’s note: This story has been updated to correct the types of projects that are eligible for the government program.
BRP's CEO hopes 'staycations' will boost sales of Sea-Doos and off-road vehicles – Yahoo Canada Finance
Sea-Doo maker BRP Inc. is facing a rough ride after the COVID-19 pandemic sank profits last quarter, with the company scrambling to cut costs while ramping up production following factory shutdowns.
First-quarter sales fell in all regions except the United States as the virus prompted staggered closures at dealerships and plants between January and May.
Despite year-over-year retail sales growth of about 35 per cent in May, the Valcourt, Que.-based company expects a 40 per cent revenue decline in the second quarter, propped up only by sustained demand among Americans.
“We’re not seeing the pickup (in Europe or Asia) that we’re seeing in the U.S.,” chief financial officer Sebastien Martel said on a conference call with analysts Thursday.
Chief executive Jose Boisjoli said “staycations and social distancing” will work to the advantage of the power sports vehicle producer. But he acknowledged that the fallout of an ongoing recession could weigh more heavily on sales, with revenue expected to drop between 10 and 20 per cent in the second half of its financial year.
“The unemployment rate is going up, consumer confidence is low and housing starts have reduced. All of this at one point will catch up,” he said.
The softer prospects prompted the company to shore up liquidity with a US$600-million loan, which matures in 2027.
BRP manufacturing operations will have resumed by next week in all six countries where it has plants following shutdowns that began between January and March, Boisjoli said.
Production will not be hampered despite physical distancing measures, but shipping will likely remain less efficient until the company builds up its inventory to ship in greater bulk, he added.
The comments came a day after BRP said it would cut 650 jobs or about five per cent of its global workforce as it stopped producing outboard motors — where sales were lagging before the global health crisis — part of up to $450 million in cost reduction measures slated for this year.
“For us, it’s a bit sad that we discontinued the production of the Evinrude — the outboard engine,” Boisjoli said. “The impact of COVID-19 has left us no choice.”
Three-wheeled motorcycles, whose sales surged in 2019, saw revenue fall by more than 40 per cent year over year in the first quarter as driver licensing offices shut down in many regions.
“The on-road industry suffered the most from containment measures due to the closure of riding schools and licence issuers and the cancellation of demo tours,” Boisjoli said.
In December 2018, he told The Canadian Press he hoped to triple global sales of three-wheelers by 2023 to more than $1 billion.
Sales of luxury items such as sporty roadsters and new Ski-Doos often wither in a recession, aggravated by an unemployment rate hovering at around 13 per cent in Canada and 15 per cent in the U.S.
“We do not believe the recent retail strength is sustainable and expect weaker economic conditions later in the year,” National Bank analyst Cameron Doerksen said in a research note.
BRP reported a loss of $2.58 per diluted share for the quarter ended April 30 as it took a $171.4-million impairment charge related to its marine business compared with a profit of $23.8 million or 25 cents per diluted share a year ago.
Revenue in the quarter fell eight per cent to $1.23 billion compared with $1.33 billion during the same period in 2019.
Excluding the impairment charge and other items, BRP said its normalized earnings for the quarter amounted to a profit of $22.7 million or 26 cents per diluted share compared with a normalized profit of $52.7 million or 54 cents per diluted share a year ago.
Analysts had expected normalized earnings at 23 cents per diluted share, according to financial markets data firm Refinitiv.
This report by The Canadian Press was first published May 28, 2020.
Companies in this story: (TSX:DOO)
Christopher Reynolds, The Canadian Press
U.S. coronavirus deaths hit grim record as cases rise rapidly in India, Russia – Globalnews.ca
The coronavirus crisis threw at least 2.1 million Americans out of work last week despite the gradual reopening of businesses around the country, stoking fears Thursday that the scourge is doing deep and potentially long-lasting damage to the U.S. economy.
Amid a few glimmers of hope, most of the latest economic news from around the globe was likewise grim, as some of the world’s most populous countries continued to report rising infections and deaths.
The confirmed U.S. death toll topped 100,000, the highest in the world, on Wednesday.
The latest job-loss figures from the U.S. Labor Department bring to 41 million the running total of Americans who have filed for unemployment benefits since the coronavirus shutdowns took hold in mid-March.
There were some encouraging signs: The overall number of Americans currently drawing jobless benefits dropped for the first time since the crisis began, from 25 million to 21 million. And first-time applications for unemployment have fallen for eight straight weeks, as states gradually let stores, restaurants and other businesses reopen and the auto industry starts up factories again.
Coronavirus outbreak: Brazil’s COVID-19 death toll surprasses the United States’
But the number of U.S. workers filing for unemployment is still extraordinarily high by historical standards, and that suggests businesses are failing or permanently downsizing, not just laying off people until the crisis can pass, economists warn.
“That is the kind of economic destruction you cannot quickly put back in the bottle,” said Adam Ozimek, chief economist at Upwork.
The U.S. unemployment rate was 14.7 per cent in April, a level not seen since the Depression, and many economists expect it will be near 20 per cent in May.
The figures come amid an intensifying debate in Congress over whether to extend $600 in extra weekly federal unemployment benefits, provided under rescue legislation passed in March but set to expire July 31.
Democrats have proposed extending the payments, while Republicans have argued that the extra money could discourage laid-off workers from returning to jobs that pay less than they are getting on unemployment.
Major outbreaks in countries that first downplayed the crisis
Kelly Kelso, a 30-year-old roadie from Nashville for the rock group Foreigner, got her first unemployment check last week after more than eight weeks of waiting. She said she is still receiving far less in benefits than the $1,250 per week or more that she made on tour.
Though she is reluctant to leave the music industry, she said, “I have a cosmetology license. If all else fails, I could go back to doing hair.”
Another looming storm cloud: Economists say the sharp loss of tax revenue for state and local governments is likely to compound the damage from the shutdowns by forcing additional public-sector layoffs in the coming weeks.
Those layoffs have just recently started showing up in the weekly jobless claims report. Washington state, for example, reported layoffs of government employees.
Job cuts are also appearing far beyond the initially hit industries such as restaurants and stores, a sign that the damage is spreading even as businesses reopen. Washington state said it saw layoffs in insurance, and New York state reported job cuts by information technology companies.
Economists say many of the jobs lost are never coming back, and double-digit unemployment could persist through 2021.
And as discouraging as the numbers are, the real picture may be worse. The government counts people as unemployed only if they’re actually looking for a job, and many Americans probably see no point in trying when so many businesses are shut down.
Airlines and aircraft manufacturers are struggling after air travel plummeted early in the outbreak. Boeing is cutting more than 12,000 U.S. jobs through layoffs and buyouts, many expected to be in the Seattle area. European budget airline Easyjet said it will cut up to a third of its 15,000 employees. American Airlines plans to eliminate about 5,100 jobs.
What the theme park experience could look like in our new reality
Amtrak likewise announced it will lay off about 20 per cent of its 18,000 workers amid a collapse in train ridership.
A number of European countries have strong safety-net programs that are underwriting the wages of millions of workers and keeping them on the payroll instead of adding them to the ranks of the unemployed. But the economic damage is mounting there, too.
Nissan is rolling back production in Spain in a move the government said could lead to 3,000 direct job cuts and thousands more losses at the automaker’s suppliers. And French unemployment claims jumped 22 per cent in April, with 843,000 more people seeking work.
Elsewhere around the world, India saw another record daily jump in coronavirus cases. Russia reported a steady increase in its caseload, even as the city of Moscow and provinces across the vast country moved to ease restrictions in sync with the Kremlin’s political agenda.
And South Korea reported its biggest jump in infections in more than 50 days, a setback that could erase some of the hard-won gains that have made it a model for the rest of the world.
Worldwide, the virus has infected more than 5.7 million people and killed over 355,000, with the U.S. having the most confirmed cases and deaths, according to a tally by Johns Hopkins University. Europe has recorded about 170,000 deaths.
The true dimensions of the disaster are widely believed to be significantly greater, with experts saying many victims died without ever being tested.
Associated Press reporters from around the world contributed to this report.
© 2020 The Canadian Press
Irving Oil's Come By Chance refinery purchase a 'building block' to get Western Canadian oil east – Financial Post
CALGARY – One of Canada’s richest families is buying Newfoundland and Labrador’s only oil refinery, which will be a “building block” in a larger strategy to process more Canadian oil.
Saint John, N.B.-based Irving Oil announced Thursday plans to buy North Atlantic Refining Corp. and its Come By Chance, Nfld. refinery from New York-based investment firm Silverpeak for an undisclosed sum, which marks the seventh time the refinery has changed hands in its storied history.
The deal is subject to conditions, including a Competition Bureau review, but it would make family-controlled Irving Oil the only refinery operator in Atlantic Canada. The deal comes weeks after Irving Oil secured permission to bring Western Canadian to the East Coast and forms part of a larger strategy to strengthen its business, according to a company spokesperson.
Last month, Irving Oil obtained Transport Canada’s approvals to source Western Canadian oil from the West Coast, through the Panama Canal to its refinery in New Brunswick.
“Our recently announced plans to source Canadian crude oil and today’s announcement in Newfoundland are two building blocks that fit together with our company’s existing strengths,” Irving spokesperson Candice MacLean said in an email. “All of these elements contribute to our long-time objective of helping Canada be even more competitive in the international landscape.”
MacLean also said Irving, which owns a 320,000-bpd refinery in Saint John and a 71,000-bpd refinery near Cork, Ireland, has been investing for years “in the broader Atlantic Basin and have continued to pursue opportunities for growth in these regions, including Atlantic Canada.”
Analysts believe the Come By Chance refinery and associated retail fuel station network in Newfoundland and Labrador are a strategic fit for Irving, which operates filling stations across Atlantic Canada and the U.S. Northeast.
The sale marks the seventh time the refinery has changed hands
Irving operates a distribution network in Newfoundland, including its flagship Big Stop trucking stations in multiple locations across the province.
“It makes sense that they would see a benefit to acquiring the Come By Chance distribution and retail assets,” IHS Markit oil markets, midstream and downstream analyst Susan Bell said in an email.
She said the Come By Chance refinery has been challenged historically because it has been prohibited from selling fuels into the broader Canadian market beyond Newfoundland.
Built with federal and provincial money between 1970 and 1973, the refinery operated for just a few years before going bankrupt in 1976. Petro Canada bought the refinery, then dubbed the “biggest lemon in the world” according to Memorial University archives, for $10 million in 1980. The Crown corporation couldn’t turn a profit on the facility either and sold it for $1 to Newfoundland Energy Ltd. in 1986.
The refinery would change hands again and again. Swiss commodities trader Vitol SA sold the facility to Calgary-based Harvest Energy Trust for $1.6 billion in 2006. Harvest, in turn, sold itself to Korea National Oil Corp. for $4.1 billion in 2009.
The refinery changed hands again in 2014 when Silverpeak, then called SilverRange Financial Partners, bought the facility and invested in expansions. The refinery was initially built to process 100,000 barrels of oil per day but now, according to Irving’s release, it is a 135,000-bpd refinery. In 2019, the previous owner of the refinery had applied to further expand the facility to process 165,000 bpd.
A spokesperson for Silverpeak declined to comment while the sale is still pending. North Atlantic Refining was the firm’s main energy holding, though it also owns a joint venture in Peru.
The facility now processes 135,000 barrels per day, up from its original 100,000
Historically, the top five foreign sources of oil to that refinery in Newfoundland were the United States, Saudi Arabia, Algeria, Nigeria and Norway, said Dinara Millington, Canadian Energy Research Institute vice-president of research.
In 2018, the majority of the refinery’s throughput was sourced from the U.S., and data from the Canada Energy Regulator show imports to Newfoundland from the U.S. averaged 88,100 bpd, or about 68 per cent of the refinery’s capacity.
Millington said the refinery is calibrated to refine light crude oil but noted that a proposed expansion project to add a coker could enable the new owners at Irving Oil to run a heavier slate in the future.
The most recent offshore oil discovery in Newfoundland is also a large heavy oil deposit, so the refinery could — at least theoretically — be recalibrated to accept heavy oil produced locally.
That heavy oil from Newfoundland “will need a home,” Millington said, though she noted a likely outcome would be to send the heavy crude to the U.S. Gulf Coast, where refineries are already designed to process heavy grades.
NHL Rumors: Canadiens, Maple Leafs, Red Wings, Sharks, Awards, More – The Hockey Writers
Toronto-based duo create custom puzzles to support local businesses – Eat North
3 new coronavirus cases confirmed in New Brunswick connected to health-care professional – Globalnews.ca
- Sports16 hours ago
How Street Fighter helped lay the foundations for the esports boom
- Media19 hours ago
‘The wrong message’: Vancouver cuts sanitation funding, hires $95K social media staffer – Globalnews.ca
- Business21 hours ago
CMHC offers dire predictions for house-price drops in B.C.
- Sports17 hours ago
Maple Leafs’ Dubas on winning with an asterisk
- Sports16 hours ago
Hamilton would play for Hurricanes
- Real eState16 hours ago
The State of Canada Real Estate
- Tech11 hours ago
Apple buys tech developed by UW profs to improve Siri – TheRecord.com
- Politics16 hours ago
Climate Politics: Trendspotting – Resilience