Canadian Companies 2016 Earnings On Absolute Fire in Justin Trudeau's First Complete Year in Office

Justin Trudeau assumed office as Canada's Prime Minister on November 5, 2015.

He was left with an absolutely horrible financial situation, similar to what happened in the US when Barack Obama assumed office as President in January 2009.

So just how bad was it in 2015 in Canada?

Well, the 17 Non-Financial Canadian Companies with stock market capitalizations above C$5 Bil in mid 2015, which filed their audited financial statements with the US Securities and Exchange Commission, and which reported their financial statements in C$s generated Total Audited Earnings From Continuing Operations in 2015 of a meager C$749 Mil, which was down 97% from their Total Audited Earnings in 2014 of C$27.334 Bil.

Then reversing course in 2016, these Total Audited Earnings flat out spiked up to C$17.160 Bil, an increase of an off-the-charts 2,191% from their Total Audited Earnings in 2015 of C$749 Mil.

The chart below show these earnings numbers:

			2016	2015	2014
Canadian Non- Financial Companies		Most	Audited	Audited	Audited
Filing With US SEC		Recent	Net	Net	Net
With Financial Reporting in C$s	City	2016	Income	Income	Income
With Market Caps Above C$5 Bil	HQs	FYE	(Loss)	(Loss)	(Loss)
			mil C$s	mil C$s	mil C$s
Canadian National Railway Co	Montreal	Dec	3,640	3,538	3,167
BCE Inc	Verdun	Dec	3,087	2,730	2,718
Enbridge Inc	Calgary	Dec	2,309	(159)	1,562
Imperial Oil Limited	Calgary	Dec	2,165	1,122	3,785
TELUS Corp	Vancouver	Dec	1,236	1,382	1,425
CGI Group Inc	Montreal	Sept	1,069	978	859
Teck Resources Ltd	Vancouver	Dec	1,041	(2,484)	382
Husky Energy Inc	Calgary	Dec	922	(3,850)	1,258
Rogers Communications	Toronto	Dec	835	1,342	1,341
TransCanada Corporation	Calgary	Dec	485	(1,140)	1,993
Pembina Pipeline Corp	Calgary	Dec	466	406	383
Shaw Communications Inc	Calgary	Aug	456	666	887
Suncor Energy Inc	Calgary	Dec	445	(1,995)	2,699
Arc Resources Ltd	Calgary	Dec	201	(343)	381
Cameco Corp	Saskatoon	Dec	(60)	63	56
Canadian Natural Resources Ltd	Calgary	Dec	(204)	(637)	3,929
Crescent Point Energy Corp	Calgary	Dec	(933)	(870)	509
Total all 17			17,160	749	27,334
2016 Total Earnings % Above 2015			2191%
2015 Total Earnings % Below 2014				-97%

In similar fashion, the 25 Canadian Companies with stock market capitalizations above C$5 Bil in mid 2015, which filed their audited financial statements with the US Securities and Exchange Commission, and which reported their financial statements in US$s generated Total Audited Earnings From Continuing Operations in 2015 of a very modest US$1.437 Bil, which was down 92% from their Total Audited Earnings in 2014 of US$18.710 Bil.

Then reversing course in 2016, these Total Audited Earnings spiked up to US$7.902 Bil, an increase of a superb 450% from their Total Audited Earnings in 2015 of US$1.437 Bil.

The chart below show these earnings numbers:

			2016	2015	2014
Canadian Companies		Most	Audited	Audited	Audited
Filing With US SEC		Recent	Net	Net	Net
With Financial Reporting in US$s	City	2016	Income	Income	Income
With Market Caps Above C$5 Bil	HQs	FYE	(Loss)	(Loss)	(Loss)
			mil US$s	mil US$s	mil US$s
Brookfield Asset Management	Toronto	Dec	3,338	4,669	5,209
Brookfield Property Partners LP	Toronto	Dec	2,717	3,766	4,420
Magna International	Aurora	Dec	2,074	1,940	1,880
Thomson Reuters	Toronto	Dec	1,056	1,127	1,959
Restaurant Brands Intl Inc	Oakville	Dec	956	512	(269)
Barrick Gold Corp	Toronto	Dec	861	(3,113)	(2,959)
Agrium	Calgary	Dec	596	988	798
Brookfield Infrastructure Partners LP	Toronto	Dec	528	391	229
Gildan Activewear	Montreal	Dec	347	305	360
PotashCorp	Saskatoon	Dec	323	1,270	1,536
lululemon athletica	Vancouver	Jan 17	303	266	239
Open Text	Waterloo	June	284	234	218
Wheaton Precious Metals	Vancouver	Dec	195	(162)	200
Goldcorp	Vancouver	Dec	162	(4,203)	(2,168)
Agnico Eagle Mines Ltd	Toronto	Dec	159	25	83
Franco Nevada Corp	Toronto	Dec	122	25	107
Turquoise Hill Resources Ltd	Vancouver	Dec	107	305	57
Brookfield Renewable Energy Partners LP	Toronto	Dec	40	103	203
Methanex Corporation	Vancouver	Dec	(28)	202	506
Fairfax Financial Holdings Ltd	Toronto	Dec	(395)	642	1,665
Cenovus Energy	Calgary	Dec	(545)	618	744
Repsol Oil & Gas Canada	Calgary	Dec	(740)	(2,812)	(341)
Encana	Calgary	Dec	(944)	(5,165)	3,426
BlackBerry Ltd	Waterloo	Feb 17	(1,206)	(208)	(304)
Valeant Pharmaceuticals Intl	Laval	Dec	(2,408)	(288)	912
Total all 25			7,902	1,437	18,710
2016 Total Earnings % Above 2015			450%
2015 Total Earnings % Below 2014				-92%

The largest Canadian Financial Companies preparing their financial statements in C$s performed much better in 2015 than the other companies shown above.

The 7 Canadian Financial Companies with stock market capitalizations above C$25 Bil in mid 2015, which filed their audited financial statements with the US Securities and Exchange Commission, and which reported their financial statements in C$s generated Total Audited Earnings From Continuing Operations in 2015 which were 2% above that in 2014.

Then in 2016, they did even better, with their Total Audited Earnings increasing by a much higher 10% over those in 2015.

The chart below show these earnings numbers, as well as also showing that unlike nearly anywhere else in the world, these very large Canadian Financial Companies earnings did not drop nearly as precipitously in 2008 as those earnings in other countries and have been just so consistently fine since the 2008-9 worldwide financial meltdown:

			2016	2015	2014	2013	2012	2011	2010	2009	2008	2007
Canadian Large Financial Companies		Most	Audited	Audited	Audited	Audited	Audited	Audited	Audited	Audited	Audited	Audited
Filing With US SEC		Recent	Net	Net	Net	Net	Net	Net	Net	Net	Net	Net
With Financial Reporting in C$s	City	2016	Income	Income	Income	Income	Income	Income	Income	Income	Income	Income
With Market Caps Above C$25 Bil	HQs	FYE	(Loss)	(Loss)	(Loss)	(Loss)	(Loss)	(Loss)	(Loss)	(Loss)	(Loss)	(Loss)
			mil C$s	mil C$s	mil C$s	mil C$s	mil C$s	mil C$s	mil C$s	mil C$s	mil C$s	mil C$s
Royal Bank of Canada	Toronto	Oct	10,458	10,026	9,004	8,342	7,558	6,650	5,732	5,681	4,555	5,492
Toronto Domunion Bank	Toronto	Oct	8,936	8,024	7,883	6,640	6,460	5,889	4,644	3,120	3,833	3,997
Bank of Nova Scotia	Toronto	Oct	7,368	7,213	7,298	6,610	6,390	5,330	4,339	3,547	3,140	4,045
Bank of Montreal	Toronto	Oct	4,631	4,405	4,333	4,195	4,156	3,266	2,810	1,787	1,978	2,131
Canadian Imperial Bank of Commerce	Toronto	Oct	4,295	3,590	3,215	3,350	3,303	3,089	2,479	1,195	(2,042)	3,327
Manulife Financial Group	Toronto	Dec	3,133	2,290	3,593	3,166	1,692	245	(312)	1,420	497	4,229
Sun Life Financial	Toronto	Dec	2,826	2,300	1,762	1,696	1,374	225	1,583	534	785	2,290
Total all 7			41,647	37,848	37,088	33,999	30,933	24,694	21,275	17,284	12,746	25,511
Earnings Growth:
….. 2016 Over 2015			10%
….. 2015 Over 2014				2%
….. 2016 Over 2008			227%
….. 2016 Over 2007			63%

Justin Trudeau has taken over from Barack Obama the leadership role of The Americas.

David Cay Johnston's "The Making of Donald Trump" Is Must Reading For Anyone Who Wants to Understand Donald Trump

A few interesting tidbits from this excellent book.

Page 53.....At the height of the Vietnam War, Donald Trump got a medical deferment after a doctor wrote that Trump had a bone spur in his foot.  Which foot? a journalist asked years later.  The author reported that Trump said he could not recall. 

Page 53.....Donald Trump never attended the very prestigious Wharton Graduate School of Management at the University of Penn.  Instead, he spent two years at Fordham College in New York City and then transferred to the University of Penn in Philadelphia as a junior.  He received his undergraduate degree in Economics at the University of Penn.

Pages 56 and 57.....In a lawsuit, a lawyer asked Trump if he knew what two very important finance concepts.....net present value and generally accepted accounting principles.....meant.  By his response, he clearly had no clue what either meant.

Page 64.....In later commenting on an employee declining to do something unseemly and then firing her....the author reported Trump as saying "I can't stomach disloyalty".  Further, revenge was a key trait he possessed.

Page 143.....The author reported that Trump chose to work with the son of a Russian mob boss.

Page 311 through 319..... The author stated that Donald Trump was involved with Felix Sater in a number of Trump Organization real estate deals, including one in Fort Lauderdale, FL where the investors got burned.  The author also stated that Sater had a checkered criminal past and that his father was a reputed Russian mob boss in Brooklyn.  The author also reported that Sater later was an operative for the CIA.

Page 390..... The author stated that so much of this book is about Trump's many complex and little known relationships with criminals-----a vast assortment of con artists, swindlers, mobsters and mob associates, a major drug trafficker he went to bat for, and other unsavory characters.
 
Page 391----- The author believes that Trump's relationships with criminals were never properly examined by those whose duty it was to investigate.


   

When There Is a Potential Critical National Security Issue Involved, It Is Only Fair That the US Federal Government Should Be Able To Subpoena the Audit Workpapers of An External Auditor of a Relevant Entity

At its investor relations website, the VEB Group has its audited financial statements for many years.  These financial statements were audited by the Big 4 CPA firm Ernst & Young LLC (EY) for all of these years but 2015, which was audited by BDO.

VEB Group's Audited Financial Statements

When reviewing VEB Group's December 31, 2016 balance sheet on Page 8, it shows that this is clearly a Russian Government controlled bank since the Equity attributable to the Russian Government is 550.3 billions of Russian rubles, whereas the Non-controlling interest is only 5.4 billion of Russian rubles.

VEB Group's Total Loans to customers at December 31, 2016 was 1,904.5 billions of Russian rubles, which was a huge 53% of its Total Assets.  A year earlier, its Total Loans to customers was an even higher 2,580.3 billions of Russian rubles, which was an even much larger 59% of its Total Assets.  The New York Times disclosed that recently, a Russian business newspaper Vedomosti reported that about 40% of VEB's Loans were at risk of default.

VEB Group's Investment financial assets classified as available for sale were an additional 470.3 billions of Russian rubles at December 31, 2016.

VEB Group's Net Investment in leases were an additional 283.6 billions of Russian rubles at December 31, 2016.

So these three assets combined were 2,658.4 billions or a huge 74% of Total Assets at December 31, 2016.

So clearly in their investigations of the relationships between the members of the Trump Administration and the Russian Government, Robert Mueller as well as the US Senate Intelligence and the US House Intelligence Committees would be very interested in the detailed makeup of these three assets which would be shown in Ernst & Young LLC's audit workpapers and BDO's audit workpapers.

In addition, these three investigators would also be interested in the makeup of several other asset categories including Investments in associates and jointly controlled entities.

Also, at December 31, 2016, VEB Group has as its largest Liability, Debt Securities Issued of 1,024.6 billions of Russian rubles.  At December 31, 2015, there were a higher 1,179.9 billions of Russian rubles of Debt Securities Issued.  A recent New York Times article reported that before the US placed sanctions on Russia, Goldman Sachs, Citigroup and Morgan Stanley, between 2006 and 2013, helped VEB issue one bond issue after another to American investors.  Thus, it will be very helpful for the three US investigators to know just who are the bond investors providing financing to this bank, which is controlled by the Russian Government, which is an adversary to the US.  

On VEB Group's 2016 Consolidated statement of profit and loss, its Loss for the year was 111.9 billions of Russian rubles, which occurred even though VEB Group's bottom line earnings were bolstered by Government grants revenues of 211.9 billions of Russian rubles and also bolstered by Recognized Gains of 182.9 billions of Russian rubles from the disposals of loans of a state-related entity against the Russian Government guarantee.

These three US investigators might have to work with the UK where Ernst & Young is now legally headquartered to get copies of the recent audit workpapers.  On the other hand, BDO's world headquarters is in Chicago, Illinois USA.

However, the top technical people of all of  these CPA firms are frequently advised on these audits and they tend to be US citizens and thus they could be subpoenaed in the US. 

Russia's largest bank is SBERBANK, which is 52.3% controlled by the Central Bank of the Russian Federation.  At December 31, 2016, its Total Loans were a massive 17,361 billions of Russian rubles.  Its financial statements were audited by Big 4 CPA Firms pwc in 2016 and EY in 2011-2015.  The three US investigators would be very interested in the detailed makeup of SBERBANK's Loans which would be shown in both pwc and EY's audit workpapers.

Below here is the link to view SBERBANK's audited financial statements.

SBERBANK's Audited Financial Statements 

The same thing would apply to the external auditor's audit workpapers of the privately-held The Trump Organization, Trump Entertainment Resorts and other Trump Companies and all of the privately-held Kushner Real Estate Organizations.

But the difference here is that the focus of the US investigations of the Trump and Kushner financial statements and their related CPA Firm Audit Workpapers should be primarily on the makeup of the debt and the equity portions of the balance sheet rather than on the makeup of the asset side of the balance sheet.  

The 3,098 US Companies With Market Caps Above $100 Mil, With December Quarter Ends And Which Have Released Their December 2016 Quarterly Earnings By May 31, 2017 Generated December 2016 Quarter Total US GAAP Earnings of $242.3 Bil, Up a Historic High 79% From Their Total US GAAP Earnings of $135.0 Bil in the December 2015 Quarter, Driven By Off-the-Charts Oil & Gas Companies Earnings Improvement

From a review of the very fine Google Finance Website, the excellent Yahoo and Zacks Earnings Calendar Websites and of company financial statements in the US SEC Website, below here are the US GAAP Earnings (Losses) From Continuing Operations for the December Quarters of both 2016 and 2015 for the Companies headquartered in the US with Stock Market Capitalizations at the end of 2016 or very early in 2017 of more than $100 Mil, which have December Quarter Ends, which have filed their December 2016 Quarter Financial Statements with the SEC by May 31, 2017, and which released their December 2016 Earnings from April 7, 2017 to May, 31, 2017:

						Dec	Dec
						2016	2015
						Quarter	Quarter
					Calendar	US GAAP	US GAAP	Net	Net
Companies With Market Caps Above $10 Bil, With			Most		4Q 116	Net	Net	Income	Income
Dec Quarter Ends And Which Have Released Their Dec	City	State	Recent		Month	Income	Income	Better	Better
2016 Quarterly Earnings Late But By May 31, 2017	HQs	HQs	FYE		End	(Loss)	(Loss)	(Worse)	(Worse)
						$ mils	$ mils	$ mils	%
Perrigo	Allegan	MI	Dec16		Dec	(1,359)	(218)	(1,141)	-523%
Total of all 372 Releasing Dec 16 Earnings Previously						214,991	162,587	52,404	32%
Total of all 373 Releasing Earnings By May 31, 2017						213,632	162,369	51,263	32%
						Dec	Dec
						2016	2015
						Quarter	Quarter
					Calendar	US GAAP	US GAAP	Net	Net
Companies With Market Caps of $1-10 Bil, With Dec			Most		4Q 16	Net	Net	Income	Income
Quarter Ends And Which Have Released Their Dec 2016	City	State	Recent		Month	Income	Income	Better	Better
Quarterly Earnings Late But By May 31, 2017	HQs	HQs	FYE		End	(Loss)	(Loss)	(Worse)	(Worse)
						$ mils	$ mils	$ mils	%
Alere Inc	Waltham	MA	Dec16		Dec	(117)	(22)	(95)	-1200%
Total of all 1.325 Releasing Dec 16 Earnings Previously						32,921	(3,339)	36,260	1086%
Total of all 1,326 Releasing Earnings By May 31, 2017						32,804	(3,361)	36,165	1076%
						Dec	Dec
						2016	2015
						Quarter	Quarter
					Calendar	US GAAP	US GAAP	Net	Net
Companies With Market Caps of $100 Mil to $1 Bil, With			Most		4Q 16	Net	Net	Income	Income
Dec Quarter Ends And Which Have Released Their Dec	City	State	Recent		Month	Income	Income	Better	Better
2016 Quarterly Earnings Late But By May 31, 2017	HQs	HQs	FYE		End	(Loss)	(Loss)	(Worse)	(Worse)
						$ mils	$ mils	$ mils	%
Independence Holding Company	Stamford	CT	Dec16		Dec	7.8	3.9	3.9
Cannabis Science	Irvine	CA	Dec16		Dec	2.0	(4.8)	6.8
MTS Systems Corp	Eden Prairie	MN	Sep16		Dec	1.7	11.8	(10.1)
Sundance Strategies	Provo	UT	Mar16		Dec	0.6	(0.5)	1.1
Lifeway Foods Inc	Morton Grove	IL	Dec16		Dec	0.5	0.3	0.2
Citizens Inc	Austin	TX	Dec16		Dec	0.1	(2.2)	2.3
Median Group	San Antonio	TX	Dec16		Dec	(0.4)	(0.2)	(0.2)
Fincera	San Diego	CA	Dec16		Dec	(0.7)	(7.2)	6.5
Axim Biotechnologies	New York	NY	Dec16		Dec	(1.2)	(6.3)	5.1
Zero Gravity Solutions	Boca Raton	FL	Dec16		Dec	(1.5)	(1.6)	0.1
PrimeEnergy Corp	Stamford	CA	Dec16		Dec	(2.4)	(10.3)	7.9
Limbach Holdings	Pittsburgh	PA	Dec16		Dec	(2.5)	1.9	(4.4)
Carolco Pictures	Boca Raton	FL	Dec16		Dec	(5.0)	(5.7)	0.7
DASAN Zhone Solutions	Oakland	CA	Dec16		Dec	(5.3)	2.0	(7.3)
Lombard Medical	Irvine	CA	Dec16		Dec	(7.7)	(11.6)	3.9
Total of all 15						(14.0)	(30.5)	16.5
Total of all 1,384 Releasing Dec 16 Earnings Previously						(4,084)	(23,936)	19,852
Total of all 1,399 Releasing Earnings By May 31, 2017						(4,098)	(23,967)	19,869
Grand Total of all 3,098 Releasing Earnings By 5-31-17
And With Market Caps Above $100 Mil						242,338	135,042	107,297	79%