Rich Kruger the former head of Imperial Oil Ltd., will take the reins of the Suncor Energy Inc. on April 3.Jeff McIntosh/The Canadian Press
Suncor Energy Inc. SU-T has gone outside the company to choose a new chief executive officer, appointing oil and gas veteran Rich Kruger to the top job as it bows to pressure from U.S.-based activist investor Elliott Investment Management LP.
Mr. Kruger, the former head of Imperial Oil Ltd. IMO-T, will take the reins of the Calgary-based energy giant on April 3, following a months-long search to replace Mark Little, who resigned as CEO last July, following a spate of safety incidents and worksite fatalities.
Two of the directors serving on Suncor’s CEO search committee were named to its board last July, as part of a deal the company struck to appease Elliott.
A source familiar with Elliott told The Globe and Mail that the hedge fund was pleased the board went with an external CEO candidate, which is what the firm believes Suncor needs to achieve necessary safety and operational improvements.
The source said Elliott looks forward to Mr. Kruger’s progress in delivering on a new culture at Suncor, specifically focusing on enhancing safety, operational efficiency and overall better performance. The Globe is not naming the source because they are not permitted to speak publicly for Elliott.
Mr. Kruger was president and CEO of Imperial from 2013 until his retirement in 2019, the culmination of his 39-year career with U.S. parent company Exxon Mobil Corp XOM-N.
Under his leadership, Imperial sold off close to 500 company-owned Esso retail stations in Canada in 2016, bolstering profits.
Suncor owns one of the country’s largest networks of gas stations, with 1,800 Petro-Canada locations. Elliott pushed Suncor in April to review its retail division, arguing it represented $5-billion in “trapped value.”
However, following a four-month review, Suncor said in November it would retain the assets, arguing that it could extract more value by keeping the familiar brand and streamlining operations as gasoline demand wanes in the coming decades, than by selling it.
While at Imperial, Mr. Kruger focused sharply on safety, reliability and operational excellence, Bank of Nova Scotia analyst Jason Bouvier said in a research note on Tuesday.
Mr. Bouvier said Mr. Kruger’s appointment was a positive change for Suncor, particularly because the new CEO “brings considerable oil sands experience and a strong history of operational safety to the role.”
Many analysts believe Elliott was pushing for new leadership at Suncor. However, Eight Capital analyst Phil Skolnick said the naming of Mr. Kruger was a surprise.
“While there was speculation that an outsider was about to be named as the new president and CEO, this was not a name thrown out there in recent conversations with investors,” Mr. Skolnick said in a note.
Mr. Skolnick added Mr. Kruger was “held in high regard” by the investment community during his time at Imperial, and said investors are likely to expect a “complete positive change” in the safety culture at Suncor under his leadership.
Mr. Kruger was one of the most outspoken critics of Canadian federal and provincial energy policy during his time as Imperial CEO – a vastly different approach than that of Mr. Little when he was at the helm of Suncor.
Mr. Kruger often complained publicly about red tape, focusing in the years before his retirement on how long it took to win Alberta regulatory approval for the two-phase, 150,000-barrel-per-day Aspen thermal oil sands project, first proposed in 2013.
Imperial announced it would go ahead with Aspen late in 2018, within months of finally winning approval for the $2.6-billion project. But it was put on hold in March, 2019, because of what Mr. Kruger called market uncertainty caused in part by the then-NDP provincial government’s oil production curtailment program, enacted in January of that year to reduce a glut of oil trapped in the province by output outgrowing pipeline capacity.
Mr. Kruger’s appointment will see interim Suncor CEO Kris Smith shuffled to the role of chief financial officer and executive vice-president of corporate development at the conclusion of the company’s annual general meeting on May 9.
Current CFO Alister Cowan plans to retire, but has offered to remain with the company through the end of the year to support the leadership transition and provide advisory services.
RBC analyst Greg Pardy said in a note on Tuesday that Mr. Smith remaining in a leadership role “lays a clear CEO succession path.”
TOKYO (AP) — Japanese technology group SoftBank swung back to profitability in the July-September quarter, boosted by positive results in its Vision Fund investments.
Tokyo-based SoftBank Group Corp. reported Tuesday a fiscal second quarter profit of nearly 1.18 trillion yen ($7.7 billion), compared with a 931 billion yen loss in the year-earlier period.
Quarterly sales edged up about 6% to nearly 1.77 trillion yen ($11.5 billion).
SoftBank credited income from royalties and licensing related to its holdings in Arm, a computer chip-designing company, whose business spans smartphones, data centers, networking equipment, automotive, consumer electronic devices, and AI applications.
The results were also helped by the absence of losses related to SoftBank’s investment in office-space sharing venture WeWork, which hit the previous fiscal year.
WeWork, which filed for Chapter 11 bankruptcy protection in 2023, emerged from Chapter 11 in June.
SoftBank has benefitted in recent months from rising share prices in some investment, such as U.S.-based e-commerce company Coupang, Chinese mobility provider DiDi Global and Bytedance, the Chinese developer of TikTok.
SoftBank’s financial results tend to swing wildly, partly because of its sprawling investment portfolio that includes search engine Yahoo, Chinese retailer Alibaba, and artificial intelligence company Nvidia.
SoftBank makes investments in a variety of companies that it groups together in a series of Vision Funds.
The company’s founder, Masayoshi Son, is a pioneer in technology investment in Japan. SoftBank Group does not give earnings forecasts.
Shopify Inc. executives brushed off concerns that incoming U.S. President Donald Trump will be a major detriment to many of the company’s merchants.
“There’s nothing in what we’ve heard from Trump, nor would there have been anything from (Democratic candidate) Kamala (Harris), which we think impacts the overall state of new business formation and entrepreneurship,” Shopify’s chief financial officer Jeff Hoffmeister told analysts on a call Tuesday.
“We still feel really good about all the merchants out there, all the entrepreneurs that want to start new businesses and that’s obviously not going to change with the administration.”
Hoffmeister’s comments come a week after Trump, a Republican businessman, trounced Harris in an election that will soon return him to the Oval Office.
On the campaign trail, he threatened to impose tariffs of 60 per cent on imports from China and roughly 10 per cent to 20 per cent on goods from all other countries.
If the president-elect makes good on the promise, many worry the cost of operating will soar for companies, including customers of Shopify, which sells e-commerce software to small businesses but also brands as big as Kylie Cosmetics and Victoria’s Secret.
These merchants may feel they have no choice but to pass on the increases to customers, perhaps sparking more inflation.
If Trump’s tariffs do come to fruition, Shopify’s president Harley Finkelstein pointed out China is “not a huge area” for Shopify.
However, “we can’t anticipate what every presidential administration is going to do,” he cautioned.
He likened the uncertainty facing the business community to the COVID-19 pandemic where Shopify had to help companies migrate online.
“Our job is no matter what comes the way of our merchants, we provide them with tools and service and support for them to navigate it really well,” he said.
Finkelstein was questioned about the forthcoming U.S. leadership change on a call meant to delve into Shopify’s latest earnings, which sent shares soaring 27 per cent to $158.63 shortly after Tuesday’s market open.
The Ottawa-based company, which keeps its books in U.S. dollars, reported US$828 million in net income for its third quarter, up from US$718 million in the same quarter last year, as its revenue rose 26 per cent.
Revenue for the period ended Sept. 30 totalled US$2.16 billion, up from US$1.71 billion a year earlier.
Subscription solutions revenue reached US$610 million, up from US$486 million in the same quarter last year.
Merchant solutions revenue amounted to US$1.55 billion, up from US$1.23 billion.
Shopify’s net income excluding the impact of equity investments totalled US$344 million for the quarter, up from US$173 million in the same quarter last year.
Daniel Chan, a TD Cowen analyst, said the results show Shopify has a leadership position in the e-commerce world and “a continued ability to gain market share.”
In its outlook for its fourth quarter of 2024, the company said it expects revenue to grow at a mid-to-high-twenties percentage rate on a year-over-year basis.
“Q4 guidance suggests Shopify will finish the year strong, with better-than-expected revenue growth and operating margin,” Chan pointed out in a note to investors.
This report by The Canadian Press was first published Nov. 12, 2024.
TORONTO – RioCan Real Estate Investment Trust says it has cut almost 10 per cent of its staff as it deals with a slowdown in the condo market and overall pushes for greater efficiency.
The company says the cuts, which amount to around 60 employees based on its last annual filing, will mean about $9 million in restructuring charges and should translate to about $8 million in annualized cash savings.
The job cuts come as RioCan and others scale back condo development plans as the market softens, but chief executive Jonathan Gitlin says the reductions were from a companywide efficiency effort.
RioCan says it doesn’t plan to start any new construction of mixed-use properties this year and well into 2025 as it adjusts to the shifting market demand.
The company reported a net income of $96.9 million in the third quarter, up from a loss of $73.5 million last year, as it saw a $159 million boost from a favourable change in the fair value of investment properties.
RioCan reported what it says is a record-breaking 97.8 per cent occupancy rate in the quarter including retail committed occupancy of 98.6 per cent.
This report by The Canadian Press was first published Nov. 12, 2024.
:format(jpeg)/cloudfront-us-east-1.images.arcpublishing.com/tgam/KLMSV52QIRBDLCWMQGY67LZZ2U.jpg)
