{"id":33,"date":"2017-08-29T11:39:10","date_gmt":"2017-08-29T11:39:10","guid":{"rendered":"http:\/\/127.0.0.1\/wordpress25\/from-restaurants-to-road-builders-bad-weather-being-blamed-for-dampening-profits.html"},"modified":"2017-08-29T11:39:10","modified_gmt":"2017-08-29T11:39:10","slug":"from-restaurants-to-road-builders-bad-weather-being-blamed-for-dampening-profits","status":"publish","type":"post","link":"https:\/\/www.moneymethods.net\/?p=33","title":{"rendered":"From restaurants to road builders, bad weather being blamed for dampening profits"},"content":{"rendered":"

Nigel Lawson: Throughout the ages the weather has been an important part of the religious narrative.<\/span><\/span> <\/figcaption><\/p>\n
\n


Geoff Zochodne <\/p>\n

August 2, 2017
6:30 AM EDT<\/p>\n

Last Updated<\/span>
August 2, 2017
6:30 AM EDT<\/p>\n

Filed under Comment Facebook Twitter Email More Share this storyFrom restaurants to road builders, bad weather being blamed for dampening profitsTumblrPinterestGoogle PlusLinkedInReddit <\/p>\n

A rainier-than-usual year in parts of Canada is messing with more than just vacation plans \u2014 it\u2019s also being blamed for putting a damper on profits.<\/p>\n

Over the past 90 days, Environment Canada said rainfall in Eastern Ontario has been about 75 per cent to 100 per cent above average, while the Greater Toronto Area has seen 25 per cent to 40 per cent more rain.<\/p>\n

One company that\u2019s been affected is Cara Operations Ltd., which reported second quarter adjusted net earnings of $26.4 million on Monday, up 3.5 per cent from the same quarter last year.<\/p>\n

The Vaughan, Ont.-based restaurant company \u2014 which has more than half of its locations in rain-soaked Ontario, including patio-friendly brands like the Landing chain \u2014 said the increase was in part connected to the added contributions of the St-Hubert rotisserie chicken brand and the Original Joe\u2019s chain it acquired in the second half of last year. However, the company also said in its filings that the results were \u201cpartially offset by weaker performance in certain Cara corporate restaurants as a result of poor weather impacting our patio season,\u201d among other factors.<\/p>\n

During a conference call Tuesday, Cara chief executive officer Bill Gregson took note of the rainy spring, but said the company hadn\u2019t tried to quantify the impact of the weather on restaurant traffic. He said some of the results had been tied to same restaurant sales, which decreased 0.3 per cent for the quarter, yet would have increased by 0.3 per cent if not for the \u201cnegative impact \u201cof the Easter weekend.<\/p>\n

\u201cThe last six weeks have been fine for patio season,\u201d added Gregson.<\/p>\n

A research note on Tuesday from National Bank Financial said Cara\u2019s reported operating earnings before interest, taxes, depreciation, and amortization (EBITDA) of $41.6 million had undershot National\u2019s $49.2-million estimate, labelling it \u201ca big miss.\u201d<\/p>\n

Cara\u2019s operating EBITDA still increased $8.8 million for the second quarter compared with 2016, although the operating EBITDA margin on system sales was 6.3 per cent, down from 7.3 per cent last year.<\/p>\n

National reduced its target price on Cara shares to $30 from $34, but maintained an outperform rating on the stock. Cara shares were trading down slightly at $23.30 at midday Tuesday.<\/p>\n

A damp year has also affected the construction industry, with inclement weather weighing on outdoor projects.<\/p>\n

In second-quarter financial results released last week, Toronto-based Aecon Group Inc. said rainfall had been a drag on its road-building business. The company reported revenue from its infrastructure segment of $235 million in Q2 \u2014 a $35 million drop from the second quarter of 2016 \u2014 despite a $14-million bump from social infrastructure.<\/p>\n

\u201cOffsetting this increase was lower revenue in transportation operations ($46 million) due to lower road-building volume in Ontario which was impacted by unusually wet weather in the quarter,\u201d said Aecon.<\/p>\n

The rain made for a tough construction climate, but a Raymond James research note last Friday said Aecon had weathered it \u201cwell.\u201d<\/p>\n

\u201cAlthough consolidated revenue of $686 (million) fell a greater-than-expected 18 per cent on poor weather conditions, profitability held up, underscoring the power of Aecon\u2019s diverse business model,\u201d wrote analyst Frederic Bastien.<\/p>\n

Raymond James kept its outperform rating and $19 target price on Aecon shares, pointing to the company\u2019s \u201csolid 2Q17 results and recently landed material energy-related contracts,\u201d as well as the \u201cbillions of dollars\u201d in the transportation and power sectors that are set to be spent in Ontario. The province\u2019s Liberal government has vowed to spend $160 billion over 12 years on public infrastructure, and is embarking on multibillion-dollar refurbishments of Ontario\u2019s nuclear power plants, an undertaking Aecon is involved in.<\/p>\n

Aecon shares were down five cents at $15.01 in Toronto on Tuesday.<\/p>\n

The poor weather isn\u2019t exclusive to Ontario. Vancouver-based CanWel Building Materials Group Ltd. reported an increase in forestry sales of 7.3 per cent, or $772,000, in its second-quarter financials, which were released last week. The company, though, suggested those sales could have been stronger, if not for troublesome weather that makes it difficult to reach some of the company\u2019s sites.<\/p>\n

\u201cSales for the (forestry) segment were negatively affected by adverse weather conditions at the beginning of the second quarter of 2017 and did not recover to seasonal expectations until the mid-point of the quarter,\u201d said CanWel in its second quarter filings.<\/p>\n

The $11.3 million in forestry sales were a much smaller contributor to the company\u2019s bottom line, as building materials revenue was $309 million in the second quarter. CanWel reported an overall 10.3-per-cent increase in its second-quarter revenues last week, to $320 million.<\/p>\n<\/section>\n","protected":false},"excerpt":{"rendered":"

Nigel Lawson: Throughout the ages the weather has been an important part of the religious narrative. Geoff Zochodne August 2, 20176:30 AM EDT Last UpdatedAugust 2, 20176:30 AM EDT Filed under Comment Facebook Twitter Email More Share this storyFrom restaurants to road builders, bad weather being blamed for dampening profitsTumblrPinterestGoogle PlusLinkedInReddit A rainier-than-usual year in parts of Canada is messing with more than just vacation plans \u2014 it\u2019s also being blamed for putting a damper on profits. Over the past 90 days, Environment Canada said rainfall in Eastern Ontario has been about 75 per cent to 100 per cent above <\/p>\n","protected":false},"author":1,"featured_media":14,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[],"class_list":["post-33","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing","has_thumb"],"_links":{"self":[{"href":"https:\/\/www.moneymethods.net\/index.php?rest_route=\/wp\/v2\/posts\/33","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.moneymethods.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.moneymethods.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.moneymethods.net\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.moneymethods.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=33"}],"version-history":[{"count":0,"href":"https:\/\/www.moneymethods.net\/index.php?rest_route=\/wp\/v2\/posts\/33\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.moneymethods.net\/index.php?rest_route=\/wp\/v2\/media\/14"}],"wp:attachment":[{"href":"https:\/\/www.moneymethods.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=33"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.moneymethods.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=33"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.moneymethods.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=33"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}