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Noah Zivitz

Managing Editor, BNN Bloomberg

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Once every quarter, Corporate Canada throws a wild assortment of quarterly reports at us. This feels like that day for Q2. From blue chip dividend-payers, to the two biggest names in our energy sector, to food and fertilizer companies navigating the highest inflation in generations and the ripple effect from Russia’s invasion of Ukraine, to compelling story stocks. We’ve got it all today. Here’s what’s standing out so far:

Canadian Natural Resources is rolling in dough, and it’s sharing that wealth with investors. The titan of the oil patch announced it will pay a special dividend of $1.50 per share later this month. That news came alongside second-quarter results showing cash flow doubled to almost $5.9 billion.

Who’d have thought years ago, back when there were fears for its future, that we’d be talking about Bombardier crushing cash flow estimates. The private-jet maker this morning hiked its full-year free cash flow forecast to more than US$515M from the earlier call for “greater than” US$50 million. It also reported an unexpected jump in second-quarter cash flow. President and CEO Éric Martel joins us shortly after 1 p.m. ET.

BCE beat second-quarter profit expectations and reaffirmed its full-year outlook today. One nugget that stood out to me in the results: record-low churn for postpaid wireless subscribers (0.75 per cent). Given Rogers’ network mishap last month, churn could shape up to be the most compelling metric among the big wireless companies in the coming quarters. BCE, of course, owns BNN Bloomberg through its Bell Media division. President and CEO Mirko Bibic joins us at 3 p.m. ET.  

Nutrien, which has been making waves for months due to global aftershocks from the invasion of Ukraine, reported a 49 per cent surge in second-quarter sales, while adjusted profit per share nearly tripled (and beat estimates). In a sign of how tides have turned in the crop nutrient industry, Nutrien also reversed an earlier US$450-million impairment of its phosphate business. Despite all that, the company cut its full-year adjusted profit outlook, citing higher natural gas costs and lower nitrogen prices.

Maple Leaf Foods is still trying to pave a path forward for its plant-based protein business. The company said this morning it took an $18.6-million restructuring charge for that division in the second quarter, while sales in the unit tumbled 15 per cent. Headaches extend beyond alt protein, however; President and CEO Michael McCain said Maple Leaf was unable “to hire adequate people resources” … and realized hyper-inflation that has been challenging to keep up with pricing.”

Restaurant Brands International reported a sharp slowdown in sales growth at Tim Hortons (12.2 per cent same-store sales, versus 27.6 per cent a year earlier), though that’s not surprising considering how the business was ravaged during COVID lockdowns. In a release, RBI CEO José Cil said Tims had an “exceptional” quarter in Canada, and that he believes “there is a long runway” for the coffee and doughnut chain that (we should keep in mind) had so many setbacks the last couple of years. Cil joins us at 1:40 p.m. ET.

Home Capital Group’s second-quarter results provide a snapshot of potential vulnerabilities in the housing market, as it set aside $4.7 million for loans that could go bad. A year earlier, it released $18.8 million from those provisions. As well, its single-family mortgage originations dipped to $2.27 billion from $2.3 billion in the first quarter. Home Capital also said it might repurchase up to $115 million of its shares.

Lightspeed Commerce handed out a mixed bag this morning. On the one hand, growth in the fiscal first quarter speaks to the magnitude of the post-lockdown reopening as gross transaction volume among its customers surged 36 per cent year-over-year to US$22.1 billion. On the downside, its revenue forecast for the current quarter falls a bit short of the average estimate. CEO JP Chauvet joins us at 9:40 a.m. ET.

SNC-Lavalin cut its full-year outlook for cash from operating activities today (now warning it will be a negative figure, possibly up to $150 million) due to higher costs at its lump-sum turnkey projects — that’s the field of work it’s champing at the bit to exit. For the most recent quarter, the embattled engineering company barely managed to turn a profit ($0.01 per share), which it blames on the cost of its remediation agreement in Quebec over transgressions tied to the Jacques Cartier Bridge contract.

Quebecor’s second-quarter profit and revenue were in line with estimates; from a news value standpoint, we’re more interested in any fresh developments on the proposed purchase of Freedom Mobile deal. This morning, the company said it secured committed debt financing for that transaction. We’ll watch for more colour on the conference call at 11 a.m. ET. 

TORONTO HOME SALES TUMBLE

July home sales collapsed in the country's largest real estate market, adding to a string of sharp declines in activity across Canada’s largest cities as rising interest rates upend market dynamics. The Toronto Regional Real Estate board says sales fell 47.4 per cent year-over-year last month. The average selling price drifted further from the February peak of about $1.33 million, settling at $1.07 million last month.  We'll dig into the psychology of buyers and sellers throughout the day. 

MARKET WATCH

After getting whipsawed by OPEC+ and U.S. inventories yesterday West Texas Intermediate dipped below US$90 per barrel this morning. Elsewhere, there’s an interesting move in the currency market, as the British pound falls against every other major currency this morning, despite the Bank of England joining the half-point rate-hike club.

WORLD’S LARGEST ASSET MANAGER OPENS UP TO CRYPTO

U.S. crypto trading platform operator Coinbase announced a partnership with BlackRock this morning, which will see the world’s largest asset manager allow its institutional client to tap into crypto. “Our institutional clients are increasingly interested in gaining exposure to digital asset markets and are focused on how to efficiently manage the operational lifecycle of these assets,” said a BlackRock official in a blog post. Coinbase shares surged almost 40 per cent in early trading this morning.

OTHER NOTABLE STORIES

  • Sun Life Financial announced the sale of its U.K. business to Phoenix Group for £248 million (~$385 million). Separately, the insurer’s second-quarter adjusted profit was little changed and exceeded the average estimate. In a sign of how noisy quarterly reports can be in this sector, check out the swings between reported and underlying results: in Sun Life’s Canadian division, for example, the reported profit sank 60 per cent year-over-year; on an adjusted/underlying basis, profit climbed 19 per cent.
  • Saputo announced late yesterday afternoon it will close a goat cheese plant in Belmont, Wis., as part of a reassessment of its U.S. footprint. Two hundred jobs are affected by that closure. Elsewhere, Saputo said it will invest $45 million to convert a mozzarella cheese facility in that same state to a goat cheese plant.

NOTABLE RELEASES/EVENTS

  • Notable data: Canadian trade balance and building permits, U.S. trade balance and initial jobless claims
  • Notable earnings: Suncor Energy, BCE, Bombardier, Restaurant Brands International, Thomson Reuters, Constellation Software, Home Capital Group, Canaccord Genuity, Dream Office Real Estate Investment Trust, Quebecor, Maple Leaf Foods, Saputo, Lightspeed Commerce, Bausch + Lomb, SNC-Lavalin, Pembina Pipeline, Kelt Exploration, Interfor, Ritchie Bros, Gildan Activewear, Cascades, Open Text, ConocoPhillips, WeWork, Lyft, Beyond Meat, Kellogg
  • 700: Bank of England releases interest rate decision
  • 1200: Cleveland Federal Reserve President Loretta Mester addresses Economic Club of Pittsburgh
  • 1245: Deputy Prime Minister and Finance Minister Chrystia Freeland holds media avail in Darmouth, N.S., after visiting Armour Transportation Systems