Stocks were mostly down on Thursday as the S&P 500 fell 0.3% and Toronto was down 0.1%.
But SNC Lavalin was up 20% after announcing Q3 results that included the big gain on the sale of most of its stake in highway 407 and that included positive progress in other areas of its business.
Apple Inc. was up 2/3%
After the close the Melcor REIT reported Q3 results which were quite good. This included an 8% gain in adjusted funds from operations per unit (although flat year to date). They also indicated they are seeing “new stability and positive momentum with leasing activity”. I have been worried about the impact of their loss of RBC as a tenant in the Royal Bank Building in Edmonton. This loss was effective with the start of Q4. They clarified that this loss was 1.6% of their total leaseable area. So it is a big loss but not over whelming. And I suspect the percentage would be closer to 1% in terms of revenue. There was no indication that they are taking a mark-to-market loss on the building due to the high vacancy. Possibly that projected vacancy was already reflected in their balance sheet value for that building – or perhaps a loss will show up in Q4.
Overall, this was definitely a positive report from the REIT. This would also mean that the parent company, Melcor Developments itself will not be reporting any material mark-to-market loss on the Royal Bank building in its Q3 report next week. Melcor will however likely show lower profit year over year due to slow residential lot sales. What may be more important is what they say about the outlook.
Constellation Software reported Q3 results which were once again quite strong.
Toll Brothers announced it has secured increased borrowing capacity. Toll Brothers’ outlook should be benefiting from lower interest / lower mortgage rates. On the other hand the fires in California could be significantly slowing their sales in that State.
Today marks the end of fiscal 2019 for Canada’s banks as well as for Toll Brothers.