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McDonald's, Starbucks, Coke, Pepsi join companies suspending business in Russia – CBC News

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McDonald’s, Starbucks, Coca-Cola and PepsiCo are the latest multinational companies to announce they’re pausing business operations in Russia to protest the country’s invasion of Ukraine. 

Over the past several days, the U.S.-based brands have faced mounting pressure on social media to cut ties with Russia due to their large footprint in the country.

On Tuesday, McDonald’s announced in a statement that it will temporarily close its more than 800 restaurants and pause all operations in Russia. The fast food chain said it will continue to pay salaries of the 62,000 Russian employees who will be affected by the closure.

“The conflict in Ukraine and the humanitarian crisis in Europe has caused unspeakable suffering to innocent people,” said CEO Chris Kempczinski. “We join the world in condemning aggression and violence and praying for peace.”

Starubcks announced Tuesday it will close all stores and suspend business operations in Russia. (Starbucks/Nicholas Matthews Photography)

Starbucks initially denounced Russia’s attack of Ukraine, but made no move to shutter its 130 stores in the country that are owned and operated by a licensed partner.

However, on Tuesday, a few hours after McDonalds’ announcement, Starbucks CEO Kevin Johnson stated online that the coffee chain will suspend all business operations in Russia. 

Coca-Cola and PepsiCo were initially silent about their plans, but both made surprise statements late Tuesday afternoon. Coca-Cola announced it would suspend all operations in Russia, while PepsiCo said it would stop making a number of products. 

“Given the horrific events occurring in Ukraine we are announcing the suspension of the sale of Pepsi-Cola, and our global beverage brands in Russia,” said PepsiCo CEO Ramon Laguarta in a statement

He said the company will continue manufacturing other products, including essentials such as milk, baby formula and baby food. 

PepsiCo, Starbucks, McDonald’s and Coca-Cola join more than 200 companies that have curtailed their Russian operations, according to a report by Jeffrey Sonnenfeld, a management professor at Yale University.

Those companies include Ikea, Apple, H&M, Canada Goose, Visa and Mastercard

Canadian companies, convenience store chain Couche-Tard, and e-commerce platform Shopify also announced this week that they’re suspending business dealings in Russia. 

Companies still in Russia

Sonnenfeld has identified more than 20 companies that still have “significant exposure” in Russia. A number of those businesses, such as Burger King and KFC, have now become targets on social media where they face calls for boycotts.

McDonald’s, Starbucks, Coca-Cola and PepsiCo were also a target, but the backlash they have faced should now come to an end as they halt operations in the country. 

Sherry Zak of Halifax is calling on multinational companies to stop doing business in Russia. (submitted by Sherry Zak)

Sherry Zak of Halifax said she has reached out to several targeted companies on social media and sometimes by personal email to demand they pull out of Russia. 

Zak, who is of Ukrainian descent, said she felt she had to take action to protest Russia’s war on Ukraine.

“My husband and I were watching the news with tears in our eyes,” she said. “It’s just heartbreaking. We’re just trying to make a change, make some change, make it stop.”

Companies respond

When asked about their positions in Russia, both Burger King and KFC told CBC News they don’t directly own their Russian locations and have donated money to help support humanitarian relief efforts for Ukraine. 

Burger King’s owner, Toronto-based Restaurant Brands International (RBI), said it has 800 Burger Kings in Russia, each owned and operated by local franchisees.

“We support the sanctions [targeting Russia] that have been put in place by the U.S., E.U., Canada and other countries and will insist that our franchisees in Russia abide by those as well,” said RBI spokesperson, Leslie Walsh, in an email.

U.S.-based Yum! Brands, which owns KFC said that almost all its approximately 1,000 KFC restaurants in Russia are operated by independent owners under license or franchise agreements.

The company said it has suspended all investment and restaurant development in Russia and will redirect all profits from its Russian operations to relief efforts in Ukraine.

WATCH | Oil prices soar due to to conflict in Ukraine: 

Oil prices soar due to to conflict in Ukraine

1 day ago
Duration 1:42:04

March 7, 2022 – Innovation, Science and Industry Minister François-Philippe Champagne and Alberta Finance Minister Travis Toews discuss the high cost of gasoline for consumers. Plus, former U.S. National Security Adviser John Bolton talks about whether a U.S. ban on Russian oil would thwart President Vladimir Putin’s invasion of Ukraine. 1:42:04

But business professor Ian Lee said companies keeping any ties with Russia right now will continue to be judged harshly by people around the world. 

“They cannot be associated in any way, shape, or form with the Russian regime, and that’s why they’ve got to leave,” said Lee, a professor at Carleton University in Ottawa. 

“Those Western companies that remain are committing — are making an enormous strategic mistake, because they will be seen increasingly in the court of public opinion to be completely insensitive.”

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Telus prioritizing ‘most important customers,’ avoiding ‘unprofitable’ offers: CFO

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Telus Corp. says it is avoiding offering “unprofitable” discounts as fierce competition in the Canadian telecommunications sector shows no sign of slowing down.

The company said Friday it had fewer net new customers during its third quarter compared with the same time last year, as it copes with increasingly “aggressive marketing and promotional pricing” that is prompting more customers to switch providers.

Telus said it added 347,000 net new customers, down around 14.5 per cent compared with last year. The figure includes 130,000 mobile phone subscribers and 34,000 internet customers, down 30,000 and 3,000, respectively, year-over-year.

The company reported its mobile phone churn rate — a metric measuring subscribers who cancelled their services — was 1.09 per cent in the third quarter, up from 1.03 per cent in the third quarter of 2023. That included a postpaid mobile phone churn rate of 0.90 per cent in its latest quarter.

Telus said its focus is on customer retention through its “industry-leading service and network quality, along with successful promotions and bundled offerings.”

“The customers we have are the most important customers we can get,” said chief financial officer Doug French in an interview.

“We’ve, again, just continued to focus on what matters most to our customers, from a product and customer service perspective, while not loading unprofitable customers.”

Meanwhile, Telus reported its net income attributable to common shares more than doubled during its third quarter.

The telecommunications company said it earned $280 million, up 105.9 per cent from the same three-month period in 2023. Earnings per diluted share for the quarter ended Sept. 30 was 19 cents compared with nine cents a year earlier.

It reported adjusted net income was $413 million, up 10.7 per cent year-over-year from $373 million in the same quarter last year. Operating revenue and other income for the quarter was $5.1 billion, up 1.8 per cent from the previous year.

Mobile phone average revenue per user was $58.85 in the third quarter, a decrease of $2.09 or 3.4 per cent from a year ago. Telus said the drop was attributable to customers signing up for base rate plans with lower prices, along with a decline in overage and roaming revenues.

It said customers are increasingly adopting unlimited data and Canada-U.S. plans which provide higher and more stable ARPU on a monthly basis.

“In a tough operating environment and relative to peers, we view Q3 results that were in line to slightly better than forecast as the best of the bunch,” said RBC analyst Drew McReynolds in a note.

Scotiabank analyst Maher Yaghi added that “the telecom industry in Canada remains very challenging for all players, however, Telus has been able to face these pressures” and still deliver growth.

The Big 3 telecom providers — which also include Rogers Communications Inc. and BCE Inc. — have frequently stressed that the market has grown more competitive in recent years, especially after the closing of Quebecor Inc.’s purchase of Freedom Mobile in April 2023.

Hailed as a fourth national carrier, Quebecor has invested in enhancements to Freedom’s network while offering more affordable plans as part of a set of commitments it was mandated by Ottawa to agree to.

The cost of telephone services in September was down eight per cent compared with a year earlier, according to Statistics Canada’s most recent inflation report last month.

“I think competition has been and continues to be, I’d say, quite intense in Canada, and we’ve obviously had to just manage our business the way we see fit,” said French.

Asked how long that environment could last, he said that’s out of Telus’ hands.

“What I can control, though, is how we go to market and how we lead with our products,” he said.

“I think the conditions within the market will have to adjust accordingly over time. We’ve continued to focus on digitization, continued to bring our cost structure down to compete, irrespective of the price and the current market conditions.”

Still, Canada’s telecom regulator continues to warn providers about customers facing more charges on their cellphone and internet bills.

On Tuesday, CRTC vice-president of consumer, analytics and strategy Scott Hutton called on providers to ensure they clearly inform their customers of charges such as early cancellation fees.

That followed statements from the regulator in recent weeks cautioning against rising international roaming fees and “surprise” price increases being found on their bills.

Hutton said the CRTC plans to launch public consultations in the coming weeks that will focus “on ensuring that information is clear and consistent, making it easier to compare offers and switch services or providers.”

“The CRTC is concerned with recent trends, which suggest that Canadians may not be benefiting from the full protections of our codes,” he said.

“We will continue to monitor developments and will take further action if our codes are not being followed.”

French said any initiative to boost transparency is a step in the right direction.

“I can’t say we are perfect across the board, but what I can say is we are absolutely taking it under consideration and trying to be the best at communicating with our customers,” he said.

“I think everyone looking in the mirror would say there’s room for improvement.”

This report by The Canadian Press was first published Nov. 8, 2024.

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TC Energy cuts cost estimate for Southeast Gateway pipeline project in Mexico

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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.

Companies in this story: (TSX:TRP)

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BCE reports Q3 loss on asset impairment charge, cuts revenue guidance

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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.

Companies in this story: (TSX:BCE)

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