Tim Hortons Inc. and Enbridge Inc. don't appear to have much in common, except that both weathered the recession in good form and managed to grow profits even during the depths of the downturn.
That's one reason the chief financial officers of both companies have been named CFO of the year for 2010. The winners are Cynthia Devine, chief financial officer of fast food chain Tim Hortons, and Richard Bird, CFO of Enbridge, one of Canada's biggest pipeline and energy companies.
This is the first time in the award's eight-year history that two individuals have been selected by a committee of business leaders. It has been presented annually since 2003 by PricewaterhouseCoopers LLP, Financial Executives International Canada and Caldwell Partners International Inc.
Peter Dey, chairman of Paradigm Capital Inc. and chair of the selection committee, said the fact that both Tim Hortons and Enbridge flourished during the recession was "clearly a factor" in the selection of the CFOs for the award.
The winners both said that the recession came at a difficult time for their companies, but strong balance sheets put them in a position to survive, and even thrive, by taking advantage of opportunities while others were retrenching.
At Tim Hortons, Ms. Devine said the company has always kept its balance sheet strong by avoiding third party financing - instead using its strong cash flow to fund expansion. That meant that during the recession it was in a position to take advantage of growth opportunities - particularly in real estate - and to help franchisees who needed financing.
At the same time, Tim Hortons went through the complex process of becoming a Canadian corporation after 15 years as a U.S. entity. "It's not as easy as it seems to put a Canadian company at the top of the [corporate]structure," and especially to do it on a tax-efficient basis, Ms. Devine said.
At Enbridge, Mr. Bird said the recession came "right smack in the middle of a huge expansion program," so the company still had to raise a lot of cash. But the firm had earlier put in place a series of substantial bank credit facilities, and this gave it "a big liquidity buffer" that helped fund growth, he said.
The economic downturn reinforced Enbridge's view that a strong balance sheet is needed to brace for possible interest rate and foreign exchange shocks, and to enable the company to take advantage of opportunities when they come along, he said.
Both Mr. Bird and Ms. Devine emphasized that they are part of a large team of financial specialists, and they would not have been successful without input from many colleagues in their companies.