Wealth Management
BTB REIT (TSX: BTB.UN) announced financial results for the second quarter of 2024 ended June 30, 2024.
Total number of properties: 75.
Total leasable area: 6.1 million square feet.
Total asset value: $1,236 million.
Market capitalization: $274 million (unit trading price of $3.13 as at June 30, 2024).
Rental revenue stood at $32.2 million for the current quarter, which represents an increase of 1.6% compared to the same quarter of 2023.
NOI totalled $18.9 million for the current quarter, which represents a decrease of 0.5% compared to the same quarter of 2023.
Net income and comprehensive income totalled $7.3 million for the quarter compared to $10.8 million for the same period in 2023, representing a decrease of $3.5 million.
Same-property NOI increased by 1.5% compared to the same period in 2023.
FFO adjusted per unit was $0.104 per unit for the quarter compared to $0.118 per unit for the same period in 2023, representing a decrease of $0.014 per unit.
FFO adjusted payout ratio was 72.2% for the quarter compared to 63.8% for the same period in 2023, an increase of 8.4%.
Emera Inc. (TSX: EMA) has entered into an agreement to sell their wholly owned operating company, New Mexico Gas Company, Inc., to Bernhard Capital Partners, a services and infrastructure-focused private equity management firm, for an aggregate transaction value of US $1.252 billion, including the assumption of approximately US $500 million of debt and subject to customary closing adjustments.
Emera acquired NMGC as part of their acquisition of the TECO group of companies in 2016.
Under Emera’s ownership, NMGC has grown and remains the largest natural gas utility in New Mexico, serving over 545,000 customers and safely managing more than 12,000 miles of transmission and distribution pipelines.
The purchase price and transaction value respectively represent approximately 23x last 12 months earnings and 1.42x rate base.
Estimated after-tax net proceeds of approximately US $750 million will be used to repay holding company debt and support their investment opportunities in their regulated utility businesses.
The transaction is expected to improve the company’s CFO to debt metrics by 50 bps and reduce their proportion of holding company leverage by 200 bps.
Medical Facilities Corporation (TSX: DR) reported financial results.
Facility service revenue increased 2.4% to $107.2 million.
Surgical case volumes increased 2.8%.
Income from operations increased 21% to $18.9 million when excluding non-controllable, non-cash corporate level charges related to share-based compensation plans.
EBITDA increased 13.7% to $23.8 million when excluding non-controllable, non-cash corporate level charges related to share-based compensation plans.
Repaid $5 million on their corporate credit facility.
After quarter end: Received forgiveness on Paycheck Protection Program loans of $6.9 million relating to certain facilities.
Pet Valu Holdings Ltd. (TSX: PET) the leading Canadian specialty retailer of pet food and pet-related supplies, today announced their financial results for the second quarter ended June 29, 2024.
System-wide sales were $353.7 million, an increase of 2.8% versus the prior year.
Same-store sales growth was nil.
Revenue was $265.2 million, up 3.5% versus the prior year, like system-wide sales growth.
Adjusted EBITDA was $57.7 million, up 7.3% versus the prior year, representing 21.8% of revenue.
Operating income was $33.8 million, down 16% versus the prior year.
Net income was $17.8 million, down from $24.1 million in the prior year.
Adjusted Net Income was $25 .9 million or $0.36 per diluted share, compared to $26 .3 million or $0.36 per diluted share, respectively, in the prior year.
Opened 5 new stores and ended the quarter with 799 stores across the network.
Silvercorp Metals Inc. (TSX: SVM) and Salazar Resources Limited (TSXV: SRL) announced that the Ministry of Energy and Mines of the Government of Ecuador has issued a Resolution of Change of Phase for the El Domo-Curipamba Project.
The Resolution of Change of Phase advances the legal status of the Project from the Economic Evaluation Phase to the Exploitation Phase and allows for the start of construction and subsequent operation of the mine. The Change of Phase for a medium-scale project, such as El Domo – Curipamba, is equivalent to the Exploitation Agreement for large-scale mines in Ecuador such as Fruta del Norte and Mirador.
Speculative Investment
Altius Renewable Royalties Corp. (TSX: ARR) reported financial results for the second quarter of 2024.
The Corporation's 50% owned Great Bay Renewables joint venture recorded $3.1 million in revenue compared to $2 million in Q2/23.
Operating cash flows at GBR were $0.9 million compared to $1.0 million in Q2 2023 primarily due to increased revenue offset by debt service costs.
Elemental Altus Royalties Corp. (TSXV: ELE) notes the announcement by Capricorn Metals Ltd (ASX: CMM) of a major expansion study at the Karlawinda Gold Project, where Elemental Altus holds an uncapped 2% NSR royalty.
The Karlawinda royalty is a cornerstone asset for Elemental Altus, contributing US$4.6 million in revenue in 2023.
Elemental Altus also announces the successful completion of the Mactung and Cantung royalty acquisition.
Karlawinda is the Company's second largest royalty and contributed US $4.6 million in revenue in 2023 when the gold price averaged less than US $2,000/oz
Capricorn has commenced work on a major expansion study for KGP, looking at an expansion of between 2.0 and 2.5 Mtpa an approximate 50% increase in throughput on the current 4.5 Mtpa
The expansion study is targeted for completion by end of 2024 and Capricorn plans to move into permitting and execution as quickly as possible
Capricorn announced a 15% increase to the Mineral Reserves to 1,428 koz gold, which is an increase of 27% after accounting for mining depletion as of July 2024.
All KGP Mineral Reserves are categorised as Probable Reserves.
Indicated Resources were increased to 1,965 koz gold. Inferred Resources include a further 287 koz of gold.
Updated KGP Mineral Reserves provide for a pre-expansion mine-life in excess of 13 years.
Gran Tierra Energy Inc. (TSX: GTE) announced an operational update.
Gran Tierra has run production casing, cemented and perforated the T-Sand oil zone and has begun production testing.
The T-Sand was perforated over 20 ft of reservoir with 29 ft of reservoir pay based on log evaluation. A jet pump was run and the well has produced at stabilized rates over 51 hours at 1,353 BOPD, 35.5-degree API gravity oil, less than 1% water cut, and a gas-oil ratio of 336 standard cubic feet per stock tank barrel.
This positive test in the T-Sand builds confidence in the multizone potential (Basal Tena / U-Sand / T-Sand) for the Zabaleta well which is expected to be drilled in the second half of 2024 and is 200 feet up dip from the recent Arawana discovery well. Arawana continues to produce with strong results from the Basal Tena zone greater than 900 bopd.
The artificial lift system will be converted from a jet pump to electrical submersible pump in the third quarter of 2024. The cumulative production to date from Arawana is approximately 74,000 bbl.
This test verifies the Bocachico structure potential in the T-Sandstone and continues to diversify the corporate producing product stream to lighter hydrocarbons.
Greenlane Renewables Inc. (TSX: GRN) announced that their wholly-owned subsidiary Airdep S.r.l. has signed a multi-unit purchase agreement with a repeat customer in Europe valued at €1.3M million for biogas desulfurization equipment.
These units are engineered to remove hydrogen sulfide (H2S) from raw biogas to protect downstream equipment.
Greenlane manufactures biogas desulfurization equipment for a variety of end uses including biogas-to-biomethane and biogas-to-power systems for the global market.
In North America, they market their biogas desulfurization equipment under the Greenlane Cascade H2S brand and under the Airdep DBC brand for the rest of the world.
Hemlo Explorers Inc. (CSE: HMLO) has entered into binding share purchase agreements with shareholders of Rocky Shore Metals Ltd. (Private) pursuant to which they have agreed to acquire all the issued and outstanding common shares of Rocky Shore in exchange for the issuance of an aggregate of 49,999,704 common shares.
Pursuant to the terms of the Transaction, each Rocky Shore Share will be exchanged for 2.832 Hemlo Shares.
After closing of the transaction, Hemlo will have 100,724,624 shares outstanding.
Acquisition of 100% ownership of 6 grass roots gold projects in a Tier 1 jurisdiction (Newfoundland, Canada) with no underlying royalties.
All properties were staked for their potential to host widespread, high grade gold mineralization in structurally complex geological environments.
Rocky Shore’s flagship Gold Anchor Project is a district scale asset in a significantly underexplored area that totals over 2,100 claims and 533 square kilometres.
No systematic exploration or drilling has ever been completed for gold over the entire property.
The Gold Anchor Project features approximately 50 kilometres of strike length of favorable metasediments bounded by two crustal faults (Dog Bay Line and Grub Line faults) hosting an interpreted “Major Fault and Splay Structural Corridor” on trend to New Found Gold Corp’s significant gold discoveries at it’s Queensway Project in Central Newfoundland.
Héroux-Devtek Inc. (TSX: HRX) reported financial results for the first quarter ended June 30, 2024.
Sales increased to $174 million, up 23.7% from $140.7 million a year ago.
Operating income increased to $19.4 million, compared to $7.5 million a year ago.
Adjusted EBITDA increased to $29.6 million or 17% of sales, compared to $16.4 million, or 11.6% of sales a year ago.
Earnings per share and adjusted earnings per share increased to $0.37 and $0.39 compared to $0.12 last year.
Cash flows related to operating activities increased to $9.9 million compared to a usage of $12.2 million last year.
MAX Power Mining Corp. (CSE: MAXX) has nearly tripled the size of their recently announced Rider Natural Hydrogen Project along the expanded Torquay-Rocanville Corridor in southeast Saskatchewan.
Rider is Canada’s largest Natural Hydrogen target area and now covers 3,356 sq. km with MAX Power’s staking of an additional eight claim blocks comprising 2,112 sq. km.
Extensive research and data modelling have demonstrated that the favorable Torquay-Rocanville Corridor extends significantly to the east based on newly-identified historical Natural Hydrogen occurrences and favorable geology.
The additional staking also includes a large claim block contiguous to the south and west of the Weyburn Block announced August 1, 2024. At Tribune, an 87.1% historical hydrogen showing in an old well is very close to a major lineament approximately 40 km due south of the 96.4% hydrogen showing at Weyburn.
Each of these additional claim blocks, under application, includes evidence of potential upward migration of hydrogen to surface, possibly through serpentinization or fracture zones.
Neo Performance Materials Inc. (TSX: NEO) has entered an agreement to sell their equity ownership interest in Neo Rare Metals (Oklahoma), LLC to Kevin Reading , the current General Manager and co-founder of the facility and announced today that their subsidiary in Estonia, NPM Narva OÜ, has been awarded the supply of sintered rare earth magnets to a leading European Tier 1 supplier of electric vehicles, traction motors (Private).
This Transaction continues Neo's drive to simplify their business globally by focusing on portfolio assets that reflect the Company's scale and growth ambitions in a competitive global business environment.
The Purchaser has agreed to purchase Neo's 80% equity interest in Quapaw in consideration for an aggregate cash purchase price equal to US $1.4 million plus cash on closing, subject to normal closing adjustments, which represents a 9x multiple of trailing twelve months of the EBITDA of the facility.
The Transaction is part of Neo's operational transformation and production optimization commitment to simplify global operations.
The Transaction includes a five-year agreement for the purchase by Quapaw of gallium and indium from the Company's in recycling facility Peterborough, Ontario as well as for the processing and transfer of gallium scrap to their Peterborough recycling facility.
Commercial award peak year volume equivalent to 35% of completed Phase I capacity
Sintered magnets to be supplied by Neo's Magnequench new manufacturing facility in Europe
Rubellite Energy Inc. (TSX: RBY) has acquired Buffalo Mission Energy Corp., a private Mannville stack-focused heavy oil producer, for a total purchase price of approximately $97.5 million.
Provides an attractive land, production and inventory base to ground a growth strategy in the Mannville stack of the Cold Lake Oil Sands Region, complementary to Rubellite's Clearwater assets in northern Alberta.
Adds approximately 67.3 gross (36.3 net) sections of contiguous, stacked Mannville rights with a total of 170 gross (85 net) identified drilling locations in the primary producing Waseca formation and 220 gross (110 net) additional potential locations across other zones within the Mannville stack.
Adds high-netback conventional heavy oil production of approximately 2,500 bbl/d and growing as new wells recently placed on-stream clean up and progressively attain stable oil production; and
Attractive transaction metrics:
2.3 times annualized net operating income with close to $47/bbl operating netback at US$75 /bbl WTI.
$39,000 per flowing boe acquired.
Maintains balance sheet strength with a pro forma leverage ratio of 1.2 times year end net debt to Q4/24 annualized adjusted funds flow.
Sitka Gold Corp. (TSXV: SIG) has closed their previously announced non-brokered private placement for aggregate gross proceeds of approximately $3,354,154 through the issuance of:
9,127,273 flow-through units sold at a price of $0.22 per FT Unit.
5,384,618 charity flow-through units sold at a price of $0.25 per Charity FT Unit.
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Markets
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Economics
Canada's International Trade Balance for June
Canada's merchandise trade balance with the world moved from a deficit of $1.6 billion in May to a surplus of $638 million in June.
Exports to the United States were up 2.6% in June, a third consecutive monthly increase, while imports from the United States rose 1.7%. As a result, Canada's trade surplus with the United States widened from $8.8 billion in May to $9.4 billion in June, the largest surplus since November 2023.
After falling 13.0% in May, exports to countries other than the United States rebounded 15.7% in June. Gains were observed in exports to the UK (unwrought gold), India (crude oil and copper ore) and Italy (aircraft). Meanwhile, imports from countries other than the United States posted a more modest increase of 2.1%. Imports from China (various products), Mexico (light trucks) and South Korea (various products) saw the largest increases in June.
As a result, Canada's trade deficit with countries other than the United States narrowed from $10.4 billion in May to $8.7 billion in June.
Exports increase on the strength of crude oil and gold
Total exports were up 5.5% in June, the largest percentage increase since February 2024. Overall, 9 of the 11 product sections increased. In June, crude oil and unwrought gold accounted for more than three-quarters of the increase in the
value of total exports. In real (or volume) terms, exports rose 3.8% in June.
Exports of energy products were up 11.7% in June, led by higher exports of crude oil (+13.3%). While prices for crude oil exports rose in June, volumes were the largest contributor to the increase. The higher exported volumes were driven in part by higher exports of crude oil to Asian countries. The rise in exports destined to this part of the world reflects increased deliveries of crude oil from Western Canada via the Trans Mountain pipeline, whose expansion was recently completed.
Following a 7.3% decline in May, exports of metal and non-metallic mineral products were up 11.8% in June. Exports of unwrought gold, silver and platinum group metals and their alloys—a category largely composed of unwrought gold—posted the largest increase (+35.3%). In the first half of 2024, large monthly fluctuations were observed in export values of unwrought gold, with the absolute monthly variation rate standing at 28.5% for the year thus far. The geopolitical context and high demand for gold are contributing factors to this volatility. In June, exports of unwrought gold to the UK rose considerably, driven by higher deliveries of refined gold.
Imports rise on the strength of motor vehicles and parts
Total imports increased 1.9% to $66.0 billion in June, a level virtually identical to the all-time high seen in June 2022. Overall, increases were observed in 9 of the 11 product sections in June 2024. In real (or volume) terms, total imports increased 1.3%.
After declining 4.2% in May, imports of motor vehicles and parts rose 5.1% in June, contributing the most to the increase in total imports. Imports of passenger cars and light trucks were up 8.2% to a record $6.8 billion in June, a fourth increase in five months. This recent growth occurred amid a recovery from production disruptions and delayed deliveries in the United States in late 2023 and early 2024.
Imports of consumer goods (+3.7%) also contributed to the increase in June. Following two consecutive monthly declines, imports of pharmaceutical products (+16.9%) rose the most, largely driven by higher imports from the United States and Ireland.
These gains were partly offset by lower imports of metal ores and non-metallic minerals (-17.1%) in June. After rising 27.1% in May, imports of other metal ores and concentrates dropped 18.5% in June. As in May, imports of gold for refining and copper ores and concentrates contributed the most to the monthly variation in June.
International trade in Services deficit widens
Canada's monthly international trade in services deficit widened from $1.0 billion in May to $1.1 billion in June. Overall, imports of services increased 1.6% to $18.3 billion, and exports of services were up 0.6% to $17.2 billion.
Imports of commercial services rose 1.8% to $10.5 billion in June, mainly because of higher payments for financial services. Imports of travel services increased 2.5% to $4.7 billion on higher spending by Canadian travellers visiting US destinations.
Exports of transportation services rose 4.3% to $1.7 billion in June. Transportation services related to the shipment of goods drove the increase, as exports of goods experienced strong monthly growth. Exports of commercial services (+0.5%) also rose.
US International Trade Balance narrows
The trade deficit in the US narrowed to $73.1 billion in June of 2024 from the revised 20-month high of $75 billion in the previous month.
Exports of goods and services from the United States rose by $3.9 billion, or 1.5%, from the previous month to $265.9 billion in June 2024, the highest since a record level of $266.2 billion hit in February.
Goods sales increased by $4.4 billion to $174.2 billion, mainly due to civilian aircraft (up $1.3 billion), natural gas (up $0.6 billion), other petroleum products (up $0.5 billion) and fuel oil (up $0.5 billion). On the other hand, exports of services decreased $0.4 billion to $91.7 billion in June.
Imports from the US rose 0.6% month-over-month to $339 billion in June 2024, the highest value since June 2022, led by purchases of consumer goods ($2.3 billion), mostly pharmaceutical preparations; capital goods ($2.2 billion), including semiconductors, telecommunications equipment, electric apparatus; travel ($0.1 billion) and maintenance and repair services ($0.1 billion). In contrast, imports fell for industrial supplies and materials ($-1.9 billion), namely crude oil, nuclear fuel materials and iron and steel mill products; and transport ($-0.2 billion). Year-to-date, imports increased $80.7 billion or 4.2%.
Among different countries, the gap with Italy decreased by $1.7 billion to $3.1 billion, the deficit with China fell by $1.6 billion to $22.3 billion, and the balance with Singapore shifted to a deficit of $0.4 billion from a surplus of $1.3 billion.
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