Business

Corporate profits reach $65.5B

Canadian corporate operating profits rose to $65.5 billion in the last three months of 2010, Statistics Canada reported Wednesday, a 7.9 per cent increase over the previous quarter.

Increases seen in 19 of 22 industries

A mining shovel at an oilsands project near Fort McMurray, Alta., in 2008. The biggest gains in profits came in mining and oil and gas.(Jeff McIntosh/Canadian Press)

Canadian corporate operating profits rose to $65.5 billion in the last three months of 2010, Statistics Canada reported Wednesday, a 7.9 per cent increase over the previous quarter.

StatsCan said the increases were widespread across the economy, with 19 of 22 industries reporting higher earnings.

The rise followed moderate declines in the previous two quarters. Operating revenues were up 2.8 per cent for the sixth straight quarter.

Operating earnings in the non-financial sector increased by 7.3 per cent, with the biggest gains in mining and oil and gas.

Financial institutions climbed by 9.5 per cent as insurance firms rebounded from a poor performance in the third quarter. Chartered banks rose 5.6 per cent.

Profits up 9% for the year

Compared with the same period a year earlier, operating profits for all industries were nine per cent.

By the end of 2010, profits had grown by 5.5 per cent since the beginning of the recovery, regaining 56 per cent of the ground lost during the recession.

"Much like the rest of the economy, corporate profit growth has downshifted considerably from the double-digit gains seen in the initial stages of the recovery," TD economist Pascal Gauthier said in a commentary.

"The economic landscape remains laden with global risks," he said, making particular note of volatile commodity prices and exchange rates.

Gauthier predicted average profit growth in the mid-to-high single-digits on a quarterly annualized basis to the end of 2012.

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