A roundup of some of the North American equities making moves in both directions today
On the rise
Roots Corp. (ROOT-T) gained after it reported sales of $76.3-million for its third quarter ended Oct. 30, up from $72.9-million a year ago. “This comes despite a significant reduction in promotional days, and inventory delays resulting in supply chain disruptions,” the company stated.
Analysts were expecting revenue of $78.3-million for the latest quarter.
Net income was $10.8-million or 25 cents per share, compared to net income of $10.3-million or 25 cents per share a year ago. Adjusted net income was $11.7-million or 28 cents per share, an improvement from $11.2-million or 27 per share a year earlier, the company stated. Analysts were expecting adjusted earnings of 21 cents per share.
Lion Electric Co (LEV-T) closed flat after the premarket announcement it has received a conditional order for 200 all-electric LionC school buses from Langs Bus Lines.
Financial terms of the deal were not immediately available.
Langs Bus Lines operates over 600 school buses and minibuses in southern Ontario.
The order is conditional on a grant under the federal government’s zero-emission transit fund.
Deliveries are set to begin gradually in 2022 and run through 2026.
Canaccord Genuity Group Inc. (CF-T) was also flat with the premarket announcement of the $277.5-million acquisition through its wealth management business in the UK and Crown Dependencies (CGWM UK) of Punter Southall Wealth Ltd. from Punter Southall Group.
London-based PSW is a wealth manager, with approximately $8.5 billion in client assets and is forecast to generate annual revenue of approximately $57-million in the year ending Dec. 31.
“This acquisition represents an opportunity for CGWM UK to build upon its exceptional growth to date and advance its priority of becoming an integrated wealth manager of scale,” said Canaccord. “PSW’s core client proposition will remain largely unchanged, and the existing direct relationships between portfolio managers, financial planners and their clients will not be affected. With a strong track record of successfully integrating businesses and clients, CGWM UK expects to achieve tangible revenue and cost synergies with a clear pathway to continued growth.”
Goeasy Ltd. (GSY-T) turned positive following the acceptance of the renewal of its normal course issuer bid.
The Mississauga-based commercial lender may purchase for cancellation up to 1.23 million common shares, representing approximately 10 per cent of its public float.
MGM Resorts International (MGM-N) was up after it said late Monday it would sell the operations of the Mirage hotel and casino in Las Vegas to Hard Rock International for about US$1.08-billion in cash.
The Mirage opened in 1989 and was acquired by MGM Resorts in 2000. The property is known for its entertainment options and 90-foot Strip-side volcano.
The sale is expected to close in the second half of 2022 and is likely to deliver to MGM Resorts net cash proceeds of about US$815-million after taxes and fees.
The company will retain the Mirage name and brand, licensing them to Hard Rock royalty-free for up to three years while it finalizes its plans to re-brand the property.
Canadian miner Noront Resources Ltd. (NOT-X) ended higher after it said on Tuesday it plans to negotiate directly with Australian billionaire Andrew Forrest’s Wyloo Metals on the company’s raised buyout offer.
Wyloo, Noront’s top shareholder, increased its offer to $1.10 a share on Monday, valuing the miner at $616.9-million, 57 per cent higher than its prior bid and outmatching BHP Group’s 75-cents per-share offer.
The move by Wyloo is the latest twist in the bidding war between the two miners from Australia for the supply of a key battery metal used in electric vehicles.
Noront on Tuesday did not provide any update whether its board is changing its recommendation for the BHP’s offer, but added that the company is reviewing Wyloo’s proposal.
BHP on Monday also ended talks with Wyloo regarding its support for the takeover of Noront as the two parties were unable to reach an agreement.
At the heart of the tussle is Noront’s Eagle Nest nickel asset in Canada’s so-called Ring of Fire, a high-grade deposit of the metal, as well as copper and palladium.
On the decline
Cannabis company Hexo Corp. (HEXO-T) dropped after it reported a jump in first-quarter revenue year-over-year alongside a wider loss and announced a new strategic plan that includes management changes and “actively evaluating alternatives in a manner which maximizes shareholder value.”
The company said its strategic review will include reducing manufacturing and production costs, streamlining and simplifying the organizational structure, realizing “cost synergies” from acquisitions and recent plant closures and a focus on revenue management through “more disciplined pricing.”
It said the initiatives are expected to generate incremental cash flow of $37.5-million in fiscal 2022 and an additional $135-million in 2023 for a total of $175-million over the two years.
As part of the management changes, the company said its chief financial officer Trent MacDonald will step down in March. The company also appointed John Bell as the new board chair, effective immediately and said current chair Michael Munzar has stepped down.
Total net revenue increased $50.2-million for the quarter ended Oct. 31 up from $29.5-million from the same time a year ago. Analysts were expecting revenue of $54.1-million. Its net loss was $116.9-million versus a loss of $4.2-million a year ago.
Village Farms International Inc. (VFF-T) was lower with the premarket announcement of receiving approval for a voluntary delisting of its common shares from the Toronto Stock Exchange.
The move will take effect at the close of trading on Dec. 31.
“With Village Farms’ common shares being listed on the Nasdaq Capital Market since February 2019, the Company believes the trading volume of its common shares on the TSX no longer justifies the expense and administrative requirements associated with maintaining a TSX listing,” it said.
“The Company also believes Nasdaq provides its shareholders with sufficient liquidity, and the cost savings from the elimination of TSX listing fees and associated professional fees, as well as the savings in time and effort of management required to maintain a dual listing, can be redirected to initiatives intended to generate shareholder value.”
New Gold Inc. (NGD-T) dipped after it announced an agreement to sell its existing gold stream held on the Blackwater Project in B.C. to Wheaton Precious Metals Corp. (WPM-T)for US$300-million in cash.
The gold stream entitles Wheaton to 8 per cent of the gold produced from Blackwater, reducing to 4 per cent of gold production once approximately 280,000 ounces of gold have been delivered to Wheaton. Gold delivered under the stream is subject to an ongoing cash price equal to 35 per cent of the spot gold price, payable to Artemis Gold Inc, the company stated.
Artemis bought the mine from New Gold last year, but New Gold retained the gold stream as partial consideration for the divestiture. “This transaction highlights another milestone for New Gold as we continue to surface value from the divestment of the Blackwater Project,” stated CEO Renaud Adams.
The company, which made the announcement after markets closed on Monday, said it intends to use the net proceeds primarily to fund research and development activities, as well as for general and administrative expenses and working capital needs.
The news came after the company announced successful efficacy results for its treatment for chronic coughing before markets opened on Monday, which sent its shares soaring by as much as 75 per cent.
With files from Brenda Bouw, staff and wires