A look at North American equities heading in both directions
On the rise
Bed Bath & Beyond Inc. (BBBY-Q) surged after it reported a quarterly loss of about US$393-million after a tough holiday season that it hoped would provide a financial cushion to its months-long cash burn.
The company did not say if it would file for bankruptcy after saying last week it was working with outside advisers to look at various options after years of weakening sales.
Bed Bath & Beyond also said it started cost reductions of about US$80-million to US$100-million across the business, including overhead expenses and headcount.
Net sales fell 33 per cent to US$1.26-billion in its third quarter as inflation strained consumers’ pockets and shoppers focused on products other than home goods, furniture and decor - merchandise that are core to Bed Bath & Beyond’s inventory mix.
Bed Bath & Beyond’s inventory fell to US$1.44-billion in its holiday quarter, down 24.9 per cent year on year, after shedding some of its owned brands and offering steep Black Friday discounts to clear excess merchandise.
“Although we moved quickly and effectively to change the assortment and other merchandising and marketing strategies, inventory was constrained and we did not achieve our goals,” CEO Sue Gove said in a statement.
The big-box retailer is considering skipping its debt payments due on Feb. 1 in an effort to conserve cash ahead of a possible bankruptcy filing, Reuters reported earlier.
Bed Bath & Beyond said last week it was exploring options, including bankruptcy, after taking on US$375-million in financing in August and failing to convince bondholders to swap out their investments for new debt earlier this month.
Bed Bath & Beyond reported a US$3.65 non-GAAP loss per share, missing Wall Street’s estimates for a loss per share of US$2.23.
Coinbase Global Inc. (COIN-Q) gained after it said on Tuesday it will reduce its work force by about 950 employees as part of a restructuring plan, in a third round of layoffs for the cryptocurrency exchange since last year.
The company said it expects to incur about US$149-million to $163-million in restructuring expenses. Its shares reverse course after rising more than 5 per cent on the layoffs announcement earlier.
Last year, rising interest rates and worries of an economic downturn wiped out more than a trillion dollars from the crypto sector. The slump also forced key industry players such as Three Arrows Capital and Celsius Network to shut shop.
Bitcoin digs in for a bumpy new year
However, the bigger blow came after larger crypto exchange FTX filed for bankruptcy protection in November. Its swift fall has sparked tough regulatory scrutiny of how major exchanges hold user funds.
“We also saw the fallout from unscrupulous actors in the industry, and there could still be further contagion,” Coinbase Chief Executive Brian Armstrong said in a blog post.
On the decline
Shares of First Quantum Minerals Ltd. (FM-T) was down in mid-morning trading after it said Tuesday it will submit an appeal by the end of the day against Panama’s order to halt operations at the firm’s local copper mine in the midst of a contract dispute.
First Quantum makes further concessions to Panama as it tries to avoid Cobre Panama shutdown
The Panamanian government and the Canadian miner have been at odds for more than a year over a new deal in which the Central American government aims to raise annual mining royalties to a minimum of $375-million.
Speaking at an investor call on Tuesday, the firm’s CEO Tristan Pascall also said First Quantum is prepared to agree to, and in part exceed, the objectives that the government outlined in January 2022 related to revenues, environmental protections and labor standards.
Among the sticking points in the negotiations are issues including legal protection against expropriation and early termination, as well as the long-term stability of the contract and royalties, Mr. Pascall added.
TC Energy Corp. (TRP-T) finished flat after saying late Monday it was too early to speculate on the cost of cleaning up a 14,000-barrel spill from its Keystone pipeline, as the Canadian company entered into a clean-up agreement with the U.S. Environmental Protection Agency (EPA).
Keystone is a major export pipeline carrying 622,000 barrels a day of crude from Alberta to U.S. refineries and was temporarily shut down in December after rupturing on Dec. 7 and leaking oil into a creek in Kansas. The pipeline resumed service in late December.
Clean-up work is ongoing and TC has not yet publicly identified the cause of the spill.
“We share the EPA’s prioritization of safety and mitigating risk to the environment, and we are committed to complying with the agreement as we progress our response, recovery, and remediation,” TC said in a statement.
“It is premature to surmise or speculate on costs.”
In a clean-up order finalized on Jan. 6, the EPA said the leaked oil impacted water in the creek at least 3-1/2 miles downstream, stained vegetation, caused a visible sheen on the water and significantly affected fish and wildlife.
The order said TC must recover oil and oil-contaminated soil and vegetation and contain the further spread of oil the creek. All work must be completed under EPA oversight.
“The federal government and the state of Kansas are committed to a thorough cleanup and restoration of the impacted area,” EPA Region 7 Administrator Meg McCollister said in a statement.
Hydro One Ltd. (H-T) was down after saying David Lebeter has been named the company’s new president and chief executive.
Kiladze: Hydro One names third CEO in five years, promotes internal executive to top post
Mr. Lebeter currently serves as the utility’s chief operating officer.
The company says the promotion to the top job is effective Feb. 1.
Mr. Lebeter will take over from interim president and CEO William Sheffield, who will help with the transition.
Mr. Sheffield stepped into the interim role last year after chief executive Mark Poweska left the company to become chief executive at Enmax.
Before joining Hydro One, Mr. Lebeter held progressively senior positions in operations and safety at BC Hydro from 2005 to 2019.
Virgin Orbit Holdings Inc. (VORB-Q) plummeted after one of its satellites failed to reach orbit after a highly-anticipated launch in England.
The “horizontal launch” mission had left from the coastal town of Newquay in southwest England, with Virgin’s LauncherOne rocket carried under the wing of a modified Boeing 747 and later released over the Atlantic Ocean.
“We appear to have an anomaly that has prevented us from reaching orbit,” the company said. “We are evaluating the information.”
The apparent failure deals a further blow to European space ambitions after an Italian-built Vega-C rocket mission failed after lift-off from French Guiana in late December.
The rockets have since been grounded.
Europe has suffered a series of setbacks in the past year, with its key Ariane 6 launcher delayed, access to Russian Soyuz rockets blocked by the Ukraine war, Vega grounded and now a showcase launch for the burgeoning small launcher industry failing.
Virgin Orbit, part-owned by British billionaire Richard Branson, had planned to deploy nine small satellites into lower Earth orbit (LEO) in its first mission outside its United States base.
With files from staff and wires