Canadian retail sales have rebounded sharply after historic declines in March and April, with vendors making up almost all of their pandemic losses, Statistics Canada reported Tuesday.
Receipts rose 19 per cent in May, the agency said in its first full release for the month. June looks to have recorded another strong gain, with a flash estimate predicting another 25 per cent increase. That would bring sales last month to about 100 per cent of February levels, according to Bloomberg calculations.
The report confirms Canadian consumers are emerging from nationwide lockdowns with pent up demand and keen to spend. At issue is whether the sharp rebound will be sustained in coming months. Policy makers have warned a full rebound in consumer confidence could take years.
“At the moment, sales are still being buoyed by the enormous government income-support programs and consumers satisfying pent-up demand, both of which could fade in the second half of the year,” Royce Mendes, an economist at CIBC World Markets, said in a report to investors.
The Canadian dollar was little changed on the news, but was already trading higher on the day — up 0.7 per cent to $1.3437 per U.S. dollar at 12:32 p.m. Toronto time.
The retail numbers are consistent with alternative spending data tracked by Canadian banks, which have been showing consumers are eager to spend.
According to a report Tuesday by Toronto-Dominion Bank, consumer spending growth moved into positive territory in early July on an annual basis for the first time since the pandemic started. Three provinces — British Columbia, Alberta, and Ontario — have been driving the national improvement in consumption, the bank said.
“Re-openings have so far been by and large met with increased spending,” Brian DePratto, a senior economist at Toronto-Dominion, said in the report.
Still, economists caution that the pace of spending growth will slow with millions of Canadians still out of work and restrictions on some businesses likely to remain for some time.
Support Shift
Prime Minister Justin Trudeau is searching for a way to shift citizens from a $2000 a month benefit fund back into the workforce. The $80 billion Canada Emergency Response Benefit runs until Oct. 3.
“CERB payments have recently been extended by Ottawa but they will eventually end. Barring a massive rebound in employment, this will squeeze household income and weigh on retail sales later this year,” Jocelyn Paquet, an economist at National Bank Financial in Montreal, wrote in a report to investors.
Retail sales in May were up in nearly all sub-sectors except food and beverage stores, which had already posted a record increase in March. The gain in sales coincided with the reopening of many brick and mortar retailers across the country after emerging from pandemic shutdowns.
Auto sales led gains, jumping 66 per cent. Excluding this sector, retail sales were up 10.6 per cent on the month. Economists in a Bloomberg survey had expected a 20 per cent gain in May sales, and a 12 per cent increase excluding autos. The statistics agency didn’t provide industry-specific estimates for June.
Even with the increase in May and June, the second quarter will go into the books as among the worst ever for Canadian retailers. Based on the June flash estimate, quarterly sales were down 15 per cent in the three months from the prior period, according to Bloomberg calculations.
CALGARY – TC Energy Corp. has lowered the estimated cost of its Southeast Gateway pipeline project in Mexico.
It says it now expects the project to cost between US$3.9 billion and US$4.1 billion compared with its original estimate of US$4.5 billion.
The change came as the company reported a third-quarter profit attributable to common shareholders of C$1.46 billion or $1.40 per share compared with a loss of C$197 million or 19 cents per share in the same quarter last year.
Revenue for the quarter ended Sept. 30 totalled C$4.08 billion, up from C$3.94 billion in the third quarter of 2023.
TC Energy says its comparable earnings for its latest quarter amounted to C$1.03 per share compared with C$1.00 per share a year earlier.
The average analyst estimate had been for a profit of 95 cents per share, according to LSEG Data & Analytics.
This report by The Canadian Press was first published Nov. 7, 2024.
BCE Inc. reported a loss in its latest quarter as it recorded $2.11 billion in asset impairment charges, mainly related to Bell Media’s TV and radio properties.
The company says its net loss attributable to common shareholders amounted to $1.24 billion or $1.36 per share for the quarter ended Sept. 30 compared with a profit of $640 million or 70 cents per share a year earlier.
On an adjusted basis, BCE says it earned 75 cents per share in its latest quarter compared with an adjusted profit of 81 cents per share in the same quarter last year.
“Bell’s results for the third quarter demonstrate that we are disciplined in our pursuit of profitable growth in an intensely competitive environment,” BCE chief executive Mirko Bibic said in a statement.
“Our focus this quarter, and throughout 2024, has been to attract higher-margin subscribers and reduce costs to help offset short-term revenue impacts from sustained competitive pricing pressures, slow economic growth and a media advertising market that is in transition.”
Operating revenue for the quarter totalled $5.97 billion, down from $6.08 billion in its third quarter of 2023.
BCE also said it now expects its revenue for 2024 to fall about 1.5 per cent compared with earlier guidance for an increase of zero to four per cent.
The company says the change comes as it faces lower-than-anticipated wireless product revenue and sustained pressure on wireless prices.
BCE added 33,111 net postpaid mobile phone subscribers, down 76.8 per cent from the same period last year, which was the company’s second-best performance on the metric since 2010.
It says the drop was driven by higher customer churn — a measure of subscribers who cancelled their service — amid greater competitive activity and promotional offer intensity. BCE’s monthly churn rate for the category was 1.28 per cent, up from 1.1 per cent during its previous third quarter.
The company also saw 11.6 per cent fewer gross subscriber activations “due to more targeted promotional offers and mobile device discounting compared to last year.”
Bell’s wireless mobile phone average revenue per user was $58.26, down 3.4 per cent from $60.28 in the third quarter of the prior year.
This report by The Canadian Press was first published Nov. 7, 2024.
TORONTO – Canada Goose Holdings Inc. trimmed its financial guidance as it reported its second-quarter revenue fell compared with a year ago.
The luxury clothing company says revenue for the quarter ended Sept. 29 totalled $267.8 million, down from $281.1 million in the same quarter last year.
Net income attributable to shareholders amounted to $5.4 million or six cents per diluted share, up from $3.9 million or four cents per diluted share a year earlier.
On an adjusted basis, Canada Goose says it earned five cents per diluted share in its latest quarter compared with an adjusted profit of 16 cents per diluted share a year earlier.
In its outlook, Canada Goose says it now expects total revenue for its full financial year to show a low-single-digit percentage decrease to low-single-digit percentage increase compared with earlier guidance for a low-single-digit increase.
It also says it now expects its adjusted net income per diluted share to show a mid-single-digit percentage increase compared with earlier guidance for a percentage increase in the mid-teens.
This report by The Canadian Press was first published Nov. 7, 2024.
