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Bombardier shares crater on profit warning, Airbus A220 writedown – CNBC

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Airbus members celebrate the landing of an Airbus A220-300 aircraft during its presentation in Colomiers near Toulouse, France, July 10, 2018. Airbus A220 is the new brand for the small CSeries passenger jet acquired from Canada’s Bombardier.

Regis Duvignau | Reuters

Bombardier’s shares fell 37% on Thursday after the company warned of lower 2019 profits and said it might have to write down significantly the value of its partnership with Airbus on A220 jets.

Bombardier, which sold control of the A220 to Airbus in 2018 as part of a long-running drive to raise cash and put it on a solid footing, said the venture needed more investment and might be subject to a writedown in fourth quarter results next month.

Under the terms of the deal, Bombardier could oblige Airbus to acquire its 33.58% stake in the program in 2026 for its market value or Airbus could oblige Bombardier to sell the stake.

Airbus, which has a 50.6% stake in the A220 program, said it remained committed to funding the jetliner on its way to profitability.

Bombardier said the program was “winning” with airlines, but latest indications were that it would need more cash to ramp up production, generate lower returns and take longer to break even.

“This may significantly impact the joint venture value,” the Canadian company said. “Bombardier will disclose the amount of any write-down when we complete our analysis and report our final fourth quarter and 2019 financial results.”

Bombardier is in the middle of a broader restructuring, focusing on its more profitable business jet and rail units.

It said delivery of four of its Global 7500 jets, a key revenue driver, had now slipped into the first quarter of 2020.

Faced with lingering problems at several projects in its rail division, Bombardier is weighing if it should direct cash aimed at the partnership toward paying down debt and bolstering rail, said a source familiar with the company’s plans.

“It is a cash deployment question,” the source said.

As of November, the Canada province of Quebec held a 16.36% stake in the A220 program.

A spokesman for Quebec’s economy minister declined to comment.

Free cash flow for 2019 is expected to be negative $1.2 billion, much lower than previously forecast negative $500 million.

Bombardier now expects 2019 adjusted earnings before interest and taxes (EBIT) to be about $400 million, compared with a previously forecast range of between $700 million and $800 million.

The company added it expects to incur a charge of about $350 million in the fourth quarter related to certain UK projects, negotiations with the Swiss Federal Railways (SBB) and higher production costs in Germany.

Bombardier shares were down about 37% at C$1.13 in early trade.

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Nova Scotia company waiting on Health Canada approval for rapid antigen test for COVID-19 – CTV News Atlantic

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HALIFAX —
The Sona Nanotech lab in Dartmouth is making history by developing a rapid antigen test for COVID-19.

“There was a moment of tremendous pride for the entire team, as Canadians, when our evaluation results came back from both third-party laboratories and in-field trials and it showed how strongly our test preformed,” said CEO David Regan.

Here’s a simple breakdown of how the test works: After a nasal pharyngeal swab is administered, the swab is placed in a tube of solution for a few moments. Then, a sample of that is placed on a lateral flow test, like a pregnancy test. The results appear within 15 minutes.

“The Sona Nanotech test is like a pregnancy test. It’s a lateral flow test and those pregnancy tests detect the existence of a hormone, our test detects the presence of the coronavirus,” said Regan.

Sona Nanotech is the only company in Canada to come up with this technology.

“The four antigen tests that have been approved in the U.S. so far are from billion dollar companies, multi-billion dollar companies, with vast resources,” said Regan.

“This test at Sona Nanotech has been developed in the lab, here at the bays in Dartmouth based on research that was started at St. Francis Xavier University in the chemistry lab there and brought to fruition over the last nine months.”

Regan says the test could help triage people faster and free up the health-care system.

“A rapid test for COVID would be a great idea,” said Dr. Todd Hatchette, the Chief of Microbiology with the Nova Scotia Health Authority. “Having the ability to provide results within 15 or 20 minutes can be helpful in many different situations. But again, it comes back to primary concern, are these tests accurate, and are they sensitive to pick up the infection.”

Regan says it is.

“This is a screening device that can be used widespread to pick up not only the virus of those people that have symptoms but importantly, before people have symptoms,” he said. “At that stage, positives can be sent to the labs for confirmation but that will be result in much shorter turnaround times.”

Right now, it’s a waiting game for the lab as they seek approval from Health Canada.

In the meantime, the company is also working on a saliva at-home test, which is considered in the early stages of development.

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Another Billion-Dollar Oil Merger Is On The Horizon – OilPrice.com

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Can The UK Auto Industry Bounce Back? | OilPrice.com

Ag Metal Miner

MetalMiner is the largest metals-related media site in the US according to third party ranking sites. With a preemptive global perspective on the issues, trends,…

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We may be coming out of the first pandemic lockdown and business does, broadly, appear to be picking up; however, but some sections of manufacturing, including U.K. car manufacturing, are still suffering badly.

U.K. car industry, supply chain face challenges

An article in the Financial Times starkly outlines the continued pain the U.K. car industry is experiencing and, by extension its extended supply chain.

U.K. car manufacturing fell 44% last month compared with a year earlier. Domestic orders and exports remain severely depressed. Last month’s performance marked the sector’s second-worst since car plants restarted after lockdown.

The Financial Times went on to advise that just 51,039 cars rolled off British production lines. The total fell from 92,153 in August 2019. Meanwhile, August output for U.K. buyers fell 58% to just 7,795 vehicles. The number of cars made for export fell 41% to 73,443 cars.

To be fair, several plants working during summer 2019 boosted August 2019 performance. Summer output followed a three-week closedown in the spring to prepare for the expected Brexit in 2019, which in the end did not transpire.

So, looking at the first half of each year gives a fairer comparison. Yet, even in that view, the decline remains dramatic.

Between January and August, the U.K. produced 40.2% fewer cars than in the same months a year earlier. The period included several weeks of complete stoppages during the first lockdown in March and April.

Year-to-date production is now down by 348,821 units worth more than £9.5 billion to U.K. carmakers, according to the Society of Motor Manufacturers and Traders (SMMT). Furthermore, projections suggest U.K. car manufacturers are now on track to produce just below 885,000 cars this year – down 34% on 2019.

Job losses in the sector

The SMMT reported at least 13,500 jobs have been cut across the U.K. automotive sector this year. The body warned up to one in six positions may be at risk in the future.

Manufacturers are hoping the government’s latest job retention scheme will help employers keep skilled workers. Skilled workers will be needed if, or when, demand comes back, but many of them are currently facing redundancy.

Rising coronavirus cases, tightening restrictions, and Brexit

Yet with virus cases increasing in the U.K. and containment measures ramping up, the SMMT is if anything more pessimistic now than it was in the early summer.

Related: The World’s Most Expensive Crudes Get Expensive Again

The SMMT says business restrictions look set to make the industry’s attempts to restart even more challenging, with the prospect of Britain’s exit from the European Union also now just 100 days away.

The industry is not in a good state to handle the country’s imminent exit from Europe on Jan. 1. In addition, the automotive industry has been at the forefront of demanding a free trade deal between the U.K. and the E.U., saying last week that “no deal” would cost the pan-European automotive industry some £100 billion in lost trade over the next five years.

Europe, though, is proving very unwilling to retain the open-door, free-trade environment for electric vehicles – which it sees as the future – as it currently does for internal combustion engine (ICE) vehicles.

The future of U.K.-E.U. auto trade

The Financial Times recently reported E.U. diplomats said the European Commission is wary of agreeing to U.K. car manufacturers being allowed to source a large number of components from other countries while still exporting electric vehicles tariff-free to the E.U.

Four out of five cars made in the U.K. are exported. Of those exports, more than half goes to the E.U. British car plants owned by Nissan, Toyota and PSA are all reliant on European sales for more than half of their business.

Last year, Nissan sold more than 30,000 U.K.-built Leaf electric cars to Europe. Toyota exported close to 120,000 hybrid models across the channel. Europe is keen to keep the U.K. as a market for components and finished vehicles but not so keen on allowing these plants to sell into the E.U. tariff-free after Brexit.

Coming on top of already challenging times this year, some foreign owners of U.K. car plants may begin to wonder whether continuing to invest in the U.K. is as desirable as it once was.

By AG Metal Miner 

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Some Ontario casinos open as province reports COVID-19 surge – CP24 Toronto's Breaking News

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TORONTO – Several Ontario casinos reopened on Monday as the province reported a surge in new cases of COVID-19.

Great Canadian Gaming Corporation says it reopened 11 of its properties, including Casino Woodbine in Toronto and Casino Ajax.

Ontario allowed casinos to reopen as parts of the province moved into Stage Three of their pandemic response this summer.

The province has, however, prohibited table games at the establishments.

Great Canadian Gaming said it will have a limit of 50 guests indoors at its casinos and is focused on reopening safely.

Ontario reported 700 new cases of COVID-19 on Monday, the highest daily increase recorded since the start of the pandemic.

This report by The Canadian Press was first published Sept. 28, 2020.

This story was produced with the financial assistance of the Facebook and Canadian Press News Fellowship.

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