Briefly:

(July 2, 2004) Canada’s western provinces will enjoy stronger economic growth over the next few years than the rest of the country, concludes a report released today by Scotia Economics.

While Scotia expects the Canadian economy to expand at an overall rate of 2.7% this year, Alberta’s economy will grow by 3.7% in 2004, Saskatchewan by 3.4% and B.C. — which trailed national expansion from 1997 to 2002 — should see growth of 3%.

“Although the gyrations of the Canadian dollar inject some uncertainty into the outlook, we expect B.C. will continue to outperform the national economy over the coming two years,” says Scotia Economics senior economist Mary Webb, citing an upbeat outlook for the petroleum sector and increased trading activity with Asia.

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AGF manages to turn a tidy profit

(June 30, 2004) AGF Management Limited has reported its second-quarter earnings, showing cash flow from operations of $68.4 million, or $0.74 per share diluted, compared with $50.8 million, or $0.55 per share diluted in 2003.

“We have a healthy balance sheet and excellent free cash flow, which we will use to build the business and create value for shareholders,” said Blake Goldring, president and CEO of AGF. “We are now focused on improving our net sales picture as we move toward the 2005 RSP season.”

Consolidated revenue was $166.0 million compared with $140.8 million in the same period last year, up $25.2 million or 17.9%. AGF also repurchased 600,000 class B non-voting shares during the quarter. Assets under management grew to $24.23 billion, from $21.87 billion in 2003.

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Canada to lag U.S. growth

(June 30, 2004) The near-term future looks bright for the Canadian economy, but it will lag that of the U.S., according to the Conference Board of Canada. The think-tank predicts growth north of the border to be 3% for 2004 and 3.6% in 2005, while American GDP growth should come in at 4.4% and 3.6%.

“The Canadian outlook is bright, but it immediately loses lustre with one over-the-fence glance at the U.S. economy,” said Peter Hall, director of economic forecasting. “Canada’s weaker showing marks a departure from recent experience, as Canadian economic growth met or surpassed U.S. performance in seven of the past 10 years.”

The Conference Board report points to the high value of the Canadian dollar as partly to blame. While the loonie has come well off its highs of earlier this year, it is still 15% higher than it was in 2002.

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Canaccord closes IPO

(June 30, 2004) Canaccord Capital Inc. has completed its initial public offering, hitting the market at $10.25 a share, with 6,829,268 common shares issued.

“Canaccord strives to be Canada’s pre-eminent independent investment dealer,” said Peter M. Brown, chair and CEO. “We view the IPO process as an opportunity to take our business to the next level and position us as a strong competitor to the bank-owned dealers.”

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OAS benefits adjusted

(June 29, 2004) Social Development Canada has announced the latest quarterly adjustment to OAS benefit rates, effective July 1, 2004. Basic benefits will increase by 0.7% to $466.63 per month.

The maximum guaranteed income supplement (GIS) and allowance payments will also increase by 0.7%.

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Franklin Templeton launches new China fund

(June 28, 2004) Franklin Templeton Investments have launched the Templeton China Tax Class Fund, which takes a value approach to investing in China, Hong Kong, Taiwan and companies seen to benefit from the growth of the region. The fund will be managed by Dr. Mark Mobius.

“The China fund has the flexibility to invest in both local and foreign companies that do business in the region,” says Mobius. “This increases the fund’s investment opportunities while providing maximum diversification.”

As part of the firm’s tax class structure, the fund allows investors to switch between funds and portfolios while deferring any taxable events. The company has also announced its Quotential Portfolios are now offered in tax class versions, as well.

“Building on the success of Quotential, the new lineup will benefit investors looking to rebalance their portfolio without realizing an immediate tax consequence,” says Don Reed, president and CEO of Franklin Templeton.

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Ontario regulator plans to eliminate its surplus

(June 28, 2004) The Ontario Securities Commission (OSC) has submitted its annual statement of priorities to the provincial government, revealing the OSC is expecting a budgetary surplus of $22.2 million over the three-year period ending March 2006.

As a result, the commission is lowering its fees to generate a deficit to match the surplus, starting March 2006. Net operating expenditures for the current fiscal year (2004-2005) are budgeted to hit $61.1million. Salaries and benefits costs, key budget components, are projected to rise by 8.7% to $44.2 million.

“The commission will review its financial position at the end of 2004 to assess the potential to implement fee revisions earlier than March 2006 in order to accelerate the return of any surplus to stakeholders,” read the OSC’s statement.

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(07/02/04)