Sep 25, 2018
The Daily Chase: Aurora swings to profit; hearing for Teck's Frontier oil sands project begins
By Noah Zivitz
Aurora Cannabis has swung to a quarterly profit on the eve of legalized recreational cannabis consumption in Canada. The pot producer’s revenue soared 223 per cent in its fiscal fourth quarter to $19.1 million, pushing it into the black with a $79.3-million profit. The company also confirmed in its release that it intends to list its shares in the United States, although the listing venue has yet to be determined. We’ll assess the investment case for Aurora versus its peers, and will keep an ear on the company’s call at 11:00 a.m. ET.
WASHINGTON CALLS OUT CANADA ON TRANS MOUNTAIN
Washington State’s Department of Ecology is taking the federal government to task over the taxpayer-owned Trans Mountain, urging it to address deficiencies in the clean-up strategy for a portion of the pipeline that cuts through the state. “We expect Canada to adhere to the high standards Washington has worked so hard to achieve,” said department representative Dale Jensen in a release. We’ll chase him.
THE CASE FOR TECK’S FRONTIER
The Alberta Energy Regulator and the Canadian Environmental Assessment Agency today will begin a hearing to evaluate Teck Resources’ $20.6-billion Frontier oil sands project. It’s a 260,000-bpd proposal that Teck says would generate almost 10,000 construction and operational jobs, $55 billion in royalties and tax revenue for Alberta, and $12 billion in tax revenue for the feds. We’ll assess the outlook for Frontier and how it could be affected by pipeline politics.
DHX SCRAPS DIVIDEND
DHX Media announced late yesterday it will suspend its quarterly dividend as its nearly year-long strategic review comes to a close. The producer and distributor (whose brands include the likes of Peanuts and Twirlywoos) said it garnered interest “for a variety of assets, business combinations and strategic partnerships” but no major deal to announce today. Instead, it unveiled a “multi-million-dollar” agreement to bolster the Peanuts brand in Asia. DHX shares have plummeted almost 72 per cent since the strategic review started last October.
DON’T MISS THESE INTERVIEWS
BNN Bloomberg's Amanda Lang will be on the ground at the Elevate technology festival in Toronto with some must-see interviews coming up later today, including conversations with Shopify CEO Tobi Lütke, Canada Pension Plan Investment Board CEO Mark Machin and Innovation Minister Navdeep Bains. Watch for them this afternoon and on BNNBloomberg.ca.
OTHER NOTABLE STORIES
-In daily Tilray watch: last I looked the pot producer’s stock was surging 24 per cent in pre-market trading.
-Yesterday's speculation is now confirmed. Michael Kors Holdings announced this morning it will buy Versace. The deal has an enterprise value of US$2.12 billion. The combined company will be renamed Capri Holdings.
-Instagram’s co-founders are leaving Facebook after six years of working for Mark Zuckerberg. See their announcement here.
-There’s a battle for power in New Brunswick today after the PCs won one more seat in the legislature than the incumbent Liberals in last night’s election. We’ll keep an eye on developments.
NOTABLE RELEASES/EVENTS
-Notable earnings: DHX Media, Nike
-Notable data: S&P/Case-Shiller U.S. home price index
-8:00 a.m. ET: Prime Minister Justin Trudeau, Foreign Affairs Minister Chrystia Freeland, International Trade Diversification Minister Jim Carr to speak in New York at Council on Foreign Relations event
-9:30 a.m. ET: Parliamentary Budget Officer Yves Giroux addresses Senate Finance Committee hearing on Canada Revenue Agency Act
-10:00 a.m. ET: U.S. Trade Representative Robert Lighthizer addresses Concordia Annual Summit in New York (https://www.concordia.net/annualsummit/2018annualsummit/agenda/#event-607)
-10:00 a.m. ET: Ontario Treasury Board President Peter Bethlenfalvy announces outcome of line-by-line provincial audit
-10:15 a.m. ET: U.S. President Donald Trump addresses UN General Assembly
-11:00 a.m. ET: Aurora Cannabis earnings call
-11:00 a.m. ET: Joint Review Panel begins hearing on Teck’s Frontier oil sands project
-12:00 p.m. ET: Alberta Premier Rachel Notley delivers keynote at International Pipeline Conference in Calgary (plus media avail)
-Elevate tech and innovation festival in Toronto (to Sept 27)
-Denver Gold Forum underway (runs to Sept 26)
-FOMC begins two-day meeting
Every morning BNN Bloomberg's Managing Editor Noah Zivitz writes a ‘chase note’ to BNN Bloomberg's editorial staff listing the stories and events that will be in the spotlight that day. Have it delivered to your inbox before the trading day begins by heading to www.bnnbloomberg.ca/subscribe.
