Shopify Inc. surged on Wednesday to become Canada’s most valuable company -- but can the e-commerce giant survive being No. 1? Ottawa-based Shopify edged past Royal Bank of Canada to become the largest publicly listed company in Canada, Bloomberg News reported. The achievement comes with a dubious distinction, however: those that leapfrogged the value of Canada’s largest bank in the past have faltered. Royal Bank, incorporated in 1869, has been Canada’s most valuable company for years, but has been been eclipsed on a few occasions.
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RioCan Real Estate Investment Trust is freezing new and early stage projects to cut costs during the coronavirus pandemic as rent collection slid, Bloomberg News reported. The move will save one of Canada’s largest retail landlords C$100 million to C$150 million ($71 million to $107 million) in development spending in 2020, RioCan said in its first quarter report Tuesday. The Toronto-based REIT said in a separate investor presentation that it collected 55% of its rent in the first quarter. The company expects 28% to still be received and has agreed to deferrals for 17% of its tenants.
Struggling Mexican airline Interjet suffered a heavy blow on Wednesday when it was suspended from the clearing house membership of the International Air Transport Association (IATA) for failing to keep up with payments, Reuters reported. The Airlines Clearing House (ACH) said in a letter dated Wednesday the membership of ABC Aerolineas S.A. de C.V., which operates under the name Interjet, was suspended with “immediate effect” due to the “non-payment of a clearance balance”.
The German company that built three Coastal-class vessels for B.C. Ferries more than a decade ago is insolvent, Business in Vancouver reported. A B.C. Ferries official said Friday that the organization has no relationship with the Flensburger Schiffbau-Gesellschaft shipyard anymore, since the warranty period for the ships was two years. “We don’t have any service or maintenance relationship with them,” B.C. Ferries spokeswoman Deborah Marshall said Friday.
Canada’s malls are facing a wave of skipped rents and could see vacancy rates triple by year-end, with the coronavirus poised to leave its scars on a fragile retail sector long after the pandemic ends. In the country’s enclosed regional malls -- a category that includes Toronto’s Eaton Centre and Pacific Centre in Vancouver -- only 20% to 25% of tenants paid rent in April, according to brokerage firm JLL Canada, Bloomberg News reported. Big box shopping centers and community strip malls took in only a little over half their expected rent.
Canada’s stellar credit rating is being put to the test as the oil crash and recession expose the country’s weak link: its provinces, Bloomberg News reported. Among the Group of Seven countries, only Germany and Canada have AAA ratings from S&P Global Ratings. But as pressure rises on the government of Justin Trudeau to aid provinces and key industries, Canada’s fiscal position is looking shakier. Going into the Covid-19 crisis, Canada’s provincial governments had C$853 billion ($602 billion) of debt securities outstanding, more than the national government.
Canadian companies are chopping costs, suspending dividends, and cutting CEO salaries to stave off loan defaults amid the coronavirus, Bloomberg News reported. But there hasn’t yet been a jump in formal bankruptcy filings, according to one of the country’s top restructuring lawyers. Instead, the emerging pain for big and small companies is spelling booming business for out-of-court proceedings, said Luc Morin, a Montreal-based insolvency and corporate restructuring partner at Norton Rose Fulbright.
The finance chief of Grupo Aeromexico SAB, Mexico’s largest airline by market value, says the company will weather a pandemic that dried up passenger demand and drove the firm’s bonds to distressed levels, even without the safety net of a potential government aid package, Bloomberg News reported. Aeromexico bonds due in 2025 now fetch just 31 cents on the dollar after the coronavirus pandemic and subsequent travel restrictions all but erased global demand for passenger flights.
A recent survey is showing alarming results and points to “a coming crisis” for the City of Vancouver’s finances, according to Mayor Kennedy Stewart, Daily Hive reported. The mayor recently shared the results of an online study conducted by the Research Co., surveying the economic impacts of the COVID-19 pandemic on Vancouver residents. The survey said that half of Vancouver’s households are reporting an “overall decrease in income,” with 24% experiencing a significant decrease. Nearly half of respondents (46%) said that they had either lost their jobs or were given reduced hours.
Many Latin America countries are announcing hefty support packages to keep businesses afloat during the economic downturn from the coronavirus, The Wall Street Journal reported. But Mexico’s nationalist leader is giving the private sector the cold shoulder, leading to growing friction between the government and business in the U.S.’s largest trading partner. President Andrés Manuel López Obrador has ruled out tax breaks or other kinds of help for businesses, saying those policies amount to a handout to the rich.