Corporate profits up in Q4

Canadian corporations earned $60.1 billion in operating profits in the fourth quarter, an increase of $4.4 billion, or 7.9 per cent, from the previous quarter, Statistics Canada reported Wednesday.

Despite the quarterly increase, the figure is still below the $77.3-billion high reached in the third quarter of 2008, just before Canada's economy headed into recession.

But it did mark the second quarter of growth since the recent low of $50.2 billion reported in the second quarter of 2009.

Non-financial industries led the way, with profits increasing 4.4 per cent from the third quarter, to $44.8 billion in the fourth. At the same time, profits in the financial industry reached $15.2 billion, up 19.7 per cent, the second straight quarterly increase. Most of the growth came from the banks and insurance companies as their expenses declined.

Gains were broad-based as 15 of 22 industries reported higher profits during the quarter.

The oil and gas, petroleum, and coal industries combined profits increased 8.6 per cent to $7 billion in the fourth quarter. Rising prices and sales volumes helped create that gain.

It was the second straight quarter of growth in the energy sector, although profits were still below their peak of $16.7 billion reported in the third quarter of 2008.

For the third straight quarter, manufacturers reported increased profits. At $11.2 billion, fourth quarter profits came in 4.4 per cent higher than in the previous quarter.

The top contributors were chemicals, plastics and rubber manufacturers, wood and paper manufacturers and primary metal manufacturers. But motor vehicle and parts manufacturers tempered these gains with a decline in profits of $583 million.

Profits in the wholesaling industry grew 12.1 per cent to $4.3 billion, with automotive product wholesalers and building materials and supplies wholesalers accounting for almost half of that growth.

Profits for retailers also grew, up 3.9 per cent to $3.4 billion.