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Business Conditions Survey: Manufacturing Remained Bullish
Statscan - In spite of increased pressure from the rising Canadian dollar and higher raw material prices, manufacturers remained bullish about production and employment prospects in the coming three months.
The Business Conditions Survey is a quarterly survey that requests manufacturers' opinions on production impediments, finished product inventory levels, new and unfilled order levels and production and employment prospects in the coming three months. The voluntary survey was conducted in the first two weeks of July and attracted over 3,000 responses from manufacturers.

Manufacturers remain positive about production prospects
In July, the proportion of manufacturers stating they would increase production over the next three months stood at 21%, down 1 point from April. The percentage of manufacturers indicating they would decrease production in the third quarter was down 1 point to 15%. As a result, the balance of opinion stood at +6, unchanged from the previous survey. The April and July balances of opinion are the most positive posted since the October 2004 survey (+11). Production prospects continued to be positive in Newfoundland and Labrador, Nova Scotia, Ontario, Saskatchewan, Alberta and British Columbia. On the other hand, opinions reported by manufacturers in Prince Edward Island, New Brunswick, Quebec and Manitoba were negative.
Producers of chemical products, transportation equipment, and plastic and rubber products, as well as electric equipment, appliances and components industries were the major contributors to the positive balance. In all, 12 of the 21 manufacturing industries posted a positive balance for production prospects in the third quarter of 2007.
The balance of opinion was determined by subtracting the proportion of manufacturers who expected production would be decreasing in the coming three months from the proportion who expected production would be increasing.
Satisfaction with level of new orders slightly less positive
While 25% of manufacturers stated that the current level of new orders was increasing, those stating that the level of new orders was decreasing jumped 8 points to 19%. As a result, the July balance of opinion, while still positive, fell 5 points from the April survey to +6. Producers in primary metal, paper and wood product industries were the major contributors to the lowered balance of opinion for orders received. Although lower, this represents the third positive balance of opinion posted in 2007 for orders received. According to May's Monthly Survey of Manufacturing, new orders for all manufacturing industries decreased 0.5% from April to just over $50.5 billion.
Manufacturers less satisfied with levels of unfilled orders
While most manufacturers continued to describe the backlog of unfilled orders as normal, the July balance of opinion decreased 5 points to -5. About 13% of manufacturers indicated that the current level of unfilled orders was higher than normal, while 18% reported a lower than normal backlog. Producers in the primary metal and paper industries were the major contributors to the negative balance of opinion for unfilled orders. With the exception of the April survey, the balance of opinion for unfilled orders has been negative since October 2004. According to May's Monthly Survey of Manufacturing, unfilled orders increased 1.8% to almost $49.1 billion, an increase of over $4.4 billion since the beginning of 2007.
Manufacturers slightly less concerned with finished-product inventories
In July, 79% of manufacturers reported that the current level of finished-product inventories was about right, up 1 point from April. Some 16% stated that inventories were too high, while 5% said inventories were too low. This left the balance of opinion at -11, a 1 point improvement from the April balance. According to May's Monthly Survey of Manufacturing, finished product inventory levels stood at just under $22.3 billion, up 0.7% from April.
Manufacturers' employment prospects remain positive
The July results for employment prospects for the next three months remained unchanged from the April survey. Roughly 68% of manufacturers stated that they would keep their current workforce, while 17% indicated that they would increase it and 15% indicated that they expected to decrease employment in the third quarter of 2007, leaving the balance of opinion at +2. Regionally, negative balances in New Brunswick (-4) Quebec (-6) and Ontario (-1) were offset by positive balances in the remaining provinces, where many manufacturers continued to express difficulty in finding skilled labour. According to the June Labour Force Survey, over the first half of 2007, manufacturing employment plummeted by 4.3% to just over 2.02 million.
Manufacturers' production impediments
The proportion of manufacturers reporting production impediments remained unchanged (29%) in the July survey. Concerns with rail car shortages, the high value of the Canadian dollar, raw material prices and skilled and unskilled labour shortages were among the most common factors cited.
| Business Conditions Survey: Manufacturing industries production prospects balance of opinion for select industries |
| |
July 2006 |
October 2006 |
January 2007 |
April 2007 |
July 2007 |
| Major group industries |
Seasonally adjusted |
| Non-durable goods |
15 |
1 |
12 |
3 |
11 |
| Food |
14 |
13 |
18 |
19 |
8 |
| Chemical |
17 |
9 |
2 |
-5 |
15 |
| Petroleum and coal products |
54 |
57 |
11 |
-3 |
-9 |
| Paper |
-2 |
-13 |
19 |
8 |
-2 |
| Plastic and rubber products |
5 |
-25 |
-25 |
-6 |
7 |
| Durable goods |
-9 |
-10 |
-1 |
6 |
3 |
| Transportation equipment |
-11 |
-10 |
-19 |
4 |
16 |
| Primary metal |
10 |
-22 |
15 |
13 |
-26 |
| Wood products |
-1 |
-12 |
-6 |
-9 |
2 |
| Fabricated metal products |
0 |
-10 |
8 |
3 |
5 |
| Machinery |
-9 |
1 |
-2 |
-2 |
-10 |
| Computer and electronic products |
-6 |
-18 |
-24 |
19 |
-1 |
| Business Conditions Survey: Manufacturing industries |
| |
July 2006 |
October 2006 |
January 2007 |
April 2007 |
July 2007 |
| |
Seasonally adjusted |
| Volume of production during next three months compared with last three months will be: |
|
|
|
|
|
| About the same (%) |
60 |
62 |
59 |
62 |
64 |
| Higher (%) |
20 |
16 |
18 |
22 |
21 |
| Lower (%) |
20 |
22 |
23 |
16 |
15 |
| Balance of opinion |
0 |
-6 |
-5 |
6 |
6 |
| New orders are: |
|
|
|
|
|
| About the same (%) |
68 |
67 |
52 |
66 |
56 |
| Rising (%) |
18 |
10 |
25 |
22 |
25 |
| Declining (%) |
14 |
23 |
22 |
11 |
19 |
| Balance of opinion |
4 |
-13 |
3 |
11 |
6 |
| Present backlog of unfilled orders is: |
|
|
|
|
|
| About normal (%) |
82 |
71 |
68 |
68 |
69 |
| Higher than Normal (%) |
8 |
5 |
11 |
16 |
13 |
| Lower than Normal (%) |
10 |
24 |
21 |
16 |
18 |
| Balance of opinion |
-2 |
-19 |
-10 |
0 |
-5 |
| Finished product inventory is: |
|
|
|
|
|
| About right (%) |
84 |
81 |
77 |
78 |
79 |
| Too low (%) |
3 |
5 |
3 |
5 |
5 |
| Too high1(%) |
13 |
14 |
20 |
17 |
16 |
| Balance of opinion |
-10 |
-9 |
-17 |
-12 |
-11 |
| Employment during the next three months will: |
|
|
|
|
|
| Change little (%) |
68 |
65 |
66 |
68 |
68 |
| Increase (%) |
15 |
15 |
15 |
17 |
17 |
| Decrease (%) |
17 |
20 |
19 |
15 |
15 |
| Balance of opinion |
-2 |
-5 |
-4 |
2 |
2 |
| |
Unadjusted |
| |
% |
| Sources of production difficulties: |
|
|
|
|
|
| Working capital shortage |
2 |
3 |
2 |
2 |
2 |
| Skilled labour shortage |
9 |
10 |
11 |
12 |
11 |
| Unskilled labour shortage |
5 |
6 |
4 |
4 |
4 |
| Raw material shortage |
5 |
4 |
4 |
4 |
4 |
| Other difficulties |
2 |
4 |
2 |
7 |
8 |
| No difficulties |
77 |
72 |
77 |
71 |
71 |
| 1. | No evident seasonality. |
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Note to readers
The Business Conditions Survey is conducted in January, April, July and October; the majority of responses are recorded in the first two weeks of these months. Results are based on replies from over 3,000 manufacturers and are weighted by a manufacturer's shipments or employment. Consequently, larger manufacturers have a correspondingly larger impact on the results than smaller manufacturers.
Except for the data on production difficulties, data in this release are seasonally adjusted.
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Magna announces Board approval of previously announced arrangement involving Russian Machines
AURORA - Magna International Inc. announced that its Board of Directors has approved a definitive Plan of Arrangement and related agreements with respect to the previously announced proposed strategic investment in Magna by Russian Machines, a wholly owned subsidiary of Basic Element Limited.
Rationale
---------
The strategic investment is designed to accelerate Magna's strategic
efforts to capitalize on significant growth opportunities in the growing
Russian automotive market as well as other emerging markets. In targeting the
Russian market, Magna believes that the best way to minimize risk and maximize
return is by working together with an established industrial partner. It also
believes that having Russian Machines and its controlling shareholder Basic
Element as a strategic partner, with an aligned interest through a significant
ownership stake in Magna, will assist Magna in carrying out its expansion
strategy in Russia and other emerging markets. Basic Element is one of the
largest, privately held industrial conglomerates in Russia and its subsidiary
Russian Machines owns a majority interest in GAZ Group, which is Russia's
second-largest automotive manufacturer.
Magna believes that, if implemented, the proposed Arrangement will
achieve a greater alignment of interests between the Stronach Trust, which
currently controls Magna, Russian Machines and other Magna shareholders and
will create "checks and balances" on the exercise of the Stronach Trust's
controlling interest in Magna by virtue of Russian Machines' Board nomination
rights and new corporate governance guidelines that will require certain major
transactions to be approved by two-thirds of the Board members. Further, the
proposed alliance is designed to preserve the fundamental business
philosophies and operating principles that have been the cornerstone of
Magna's success, including Magna's Corporate Constitution and its Employee
Charter.
Overview of Arrangement
-----------------------
The terms of the Arrangement and related agreements are consistent in all
material respects with those announced jointly by Magna and Basic Element on
May 10, 2007 and will be described in detail in the management information
circular/proxy statement (the "Circular") to be mailed on or about August 1,
2007 to Magna shareholders of record as of July 16, 2007 in respect of the
special meeting of Magna shareholders currently scheduled to take place on
August 28, 2007 (subject to court approval) to approve the Arrangement. The
Circular will contain relevant information concerning the Arrangement,
including a description of (i) the definitive transaction terms and
conditions, (ii) the Board's recommendation to shareholders, the factors
underlying the Board's recommendation and a description of the review
conducted by the Special Committee of independent directors and its legal and
financial advisors, (iii) the shareholder votes and court and regulatory
approvals required to carry out the Arrangement, which votes will include a
"majority of minority" of the votes cast by holders of Class A Subordinate
Voting Shares, voting separately as a class, and (iv) the dissent rights
available to "minority" Class B shareholders if the Arrangement includes the
proposed buyback of the Class B Shares other than those currently controlled
by the Stronach Trust. The remainder of this press release is qualified by the
more detailed information appearing in the Circular and shareholders are urged
to review the Circular carefully.
Under the terms of the proposed Arrangement, Russian Machines would
invest approximately US$1.54 billion to acquire indirectly 20 million Magna
Class A Subordinate Voting Shares from treasury. A new Canadian holding
company ("Newco") would hold the respective holdings in Magna of the Stronach
Trust and Russian Machines, as well as a portion of the respective holdings in
Magna of Donald Walker, Siegfried Wolf, Vincent Galifi, Jeffrey Palmer and
Peter Koob (collectively, the "Principals"), all of whom are members of
Magna's executive management. Subject to approval by a majority of the votes
cast by "minority" Class B Shareholders, the proposed Arrangement would also
involve the purchase by Magna for cancellation of all outstanding Class B
Shares not held by the Stronach Trust for Cdn.$114.00 in cash per Class B
Share (the "Class B Share Acquisition"). If the Arrangement includes the Class
B Share Acquisition, the number of votes attached to the Class B Shares would
be reduced from 500 votes to 300 votes per share (the "Class B Share Vote
Reduction").
Upon the completion of the proposed Arrangement, Newco will hold
indirectly 726,829 Class B Shares and 20,605,000 Class A Subordinate Voting
Shares. Assuming approval of the Class B Share Acquisition, Newco will
indirectly hold 100% of the outstanding Class B Shares and approximately 16%
of the outstanding Class A Subordinate Voting Shares, collectively
representing approximately 68.8% of the total voting power of all the
outstanding shares of Magna. In connection with the Arrangement, the Stronach
Trust and Russian Machines will enter into certain agreements governing their
relationship as shareholders, including the voting of the Magna shares held
indirectly by Newco and the terms upon which Russian Machines may elect to
withdraw, or the Stronach Trust may cause Russian Machines to withdraw, its
investment in Newco and terminate those governance arrangements.
The Principals, the Stronach Trust and Stronach & Co., an associate of
Magna's Chairman, Mr. Frank Stronach, have interests in the Arrangement that
are different from other shareholders. Those interests were identified in
Magna's press release dated May 10, 2007 and will also be disclosed in the
Circular.
Magna's Board approval today of the Arrangement and related agreements
followed the report and favourable recommendation of its Special Committee of
independent directors formed to review and consider the Arrangement and
related transactions. In doing so, the Board determined that the Arrangement
is in the best interests of Magna and its shareholders and authorized the
submission of the Arrangement to holders of Magna's Class A Subordinate Voting
Shares and Class B Shares for their approval as required under applicable law.
CIBC World Markets Inc. ("CIBCWM"), the independent financial advisor to the
Special Committee, concluded that, as of May 9, 2007 (the date the Board
approved the previously announced Transaction Agreement with Russian
Machines), the consideration of CDN$114.00 per Class B Share to be offered to
each minority holder of Magna's Class B Shares under the Arrangement is fair,
from a financial point of view, to the minority holders of Magna Class B
Shares. A copy of the CIBCWM fairness opinion, the factors considered by the
Special Committee and Magna's Board and other relevant background information
will be included in the Circular.
Subject to court approval, Magna expects to hold the Special
Shareholders' Meeting on August 28, 2007 in Toronto and expects that the
Arrangement, if approved, will become effective in September 2007, subject to
receipt of necessary regulatory approvals. The Arrangement will require the
approval of shareholders, including:
<<
- a majority of the votes cast by Magna Class A Subordinate Voting
Shareholders and Class B Shareholders (excluding certain "insiders"
as defined in the Toronto Stock Exchange Company Manual), voting
together as a single class;
- a majority of the votes cast by the "minority" Class A Shareholders,
voting separately as a class; and
- with respect only to the Class B Share Acquisition, a majority of the
votes cast by "minority" Class B Shareholders, voting separately as a
class.
>>
Magna and certain parties related to Magna, including its directors and
senior officers, may not vote their Class A Subordinate Voting Shares or Class
B Shares for the purposes of the "majority of the minority" approval
requirements. If the Class B Share Acquisition is not approved by the
"minority" Class B Shareholders, but the Arrangement is otherwise approved by
the requisite votes of shareholders, then the Arrangement, excluding the Class
B Share Acquisition and the Class B Share Vote Reduction, will proceed
(subject to the satisfaction or waiver of all other conditions).
The Arrangement requires court approval. Prior to the mailing of the
Circular, Magna will obtain an interim court order, which will provide for the
calling and holding of the Special Shareholders' Meeting, the grant of dissent
rights to "minority" holders of Class B Shares in respect of the Class B Share
Acquisition, and other procedural matters. If the Arrangement is approved by
shareholders at the Special Shareholders' Meeting in the manner required by
the interim order, a hearing in respect of a final order will take place to
consider, among other things, the fairness of the Arrangement.
Proposed Substantial Issuer Bid
-------------------------------
On May 10, 2007, in connection with, and conditional upon completion of,
the Arrangement, Magna announced its intention to make a substantial issuer
bid to purchase up to 20 million of its outstanding Class A Subordinate Voting
Shares. The issuer bid is expected to take the form of a modified "Dutch
auction", whereby Magna will offer a range of prices within which it is
willing to repurchase such Class A Subordinate Voting Shares. The issuer bid
is expected to be an offer to purchase up to 20 million Class A Subordinate
Voting Shares at an aggregate price of not more than $1,536,600,000. Pricing
information and other material terms and conditions are expected to be
determined by the Board and publicly announced prior to the Special
Shareholders' Meeting.
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ATS awarded US$7.7 million order to automate assembly of electronic security devices
CAMBRIDGE - ATS Automation Tooling Systems Inc. today announced it has been awarded a US$7.7 million order to design, build and install an automated, high-volume assembly system for a leading global provider of advanced electronic security products.
The five-zone manufacturing system, featuring ATS Supertrak(TM)
high-speed conveyance technology, will be built for this first-time customer
primarily at ATS facilities in Tucson, Arizona and Corvallis, Oregon and is
scheduled for delivery in early fiscal 2009 (spring of calendar 2008). The
name of the customer cannot be released due to customer confidentiality.
"We are delighted to have been selected by this customer to participate
in the production of this sophisticated electronic security device," said Ron
Jutras, ATS President and CEO. "This is an exciting project and an excellent
example of how ATS's advanced technology toolkit, our strategic sales focus
and our well-positioned manufacturing operations in the US have combined to
provide us with an entree into an important new customer account in a growing
niche market. We intend to build on this relationship."
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Ontario's overall economic expansion is limited by ongoing restructuring in manufacturing, says Scotiabank economists
TORONTO - Ontario's economy is expected to remain in the slow lane of growth over the 2007-2008 period, as ongoing weakness in manufacturing offsets major public and private construction projects, according to Scotia Economics' latest Provincial Trends report.
"The province's auto sector is mired in a big slump, although the Big
Three are actively restructuring operations," says David Hamilton, Economist,
Scotiabank. "While difficulties persist for the province's forest products
sector, key bright spots exist, including Ontario's mining sector, which is
currently riding a wave of high global demand."
"Public and private non-residential construction should expand moderately
in 2007 and 2008," adds Mr. Hamilton. "Several large mining developments and
numerous new office towers are currently underway, in addition to the
revitalization of the auto sector. Public investment will be significant over
the forecast period as the provincial government undertakes several
large-scale infrastructure projects."
According to the report, Canadian real GDP growth is expected to average
around 2.5 per cent in 2007 and 2008, roughly half a percentage point below
the average of the previous three years. While this should largely mirror both
the slowdown in the U.S. economy and the growth-robbing shortage of labour and
selected materials, it obscures several key trends that are continuing to
dominate Canada's underlying performance.
First, the pace of economic activity remains two to three times greater
in the resource-rich regions in the west, north and east. Export-sensitive
manufacturing-centric provinces in Central Canada remain constrained, not only
by the U.S. slowdown, but by the loss of competitiveness associated with
increased foreign competition and an even stronger Canadian dollar.
Second, in all provinces, domestic-led activity remains fairly robust,
led by consumer spending, non-residential construction, and services.
And thirdly, infrastructure spending will remain a key driver of domestic
growth across all provinces. Besides the much-needed outlays in health and
education, there is a renewed push to upgrade transportation networks and
ports, in addition to new green initiatives.
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Arriscraft International Income Fund announces unitholder approval of the previously announced sale of its assets to General Shale and provides an update on the estimated redemption price
TORONTO - Arriscraft International Income Fund (TSX: AIN.UN) today announced that its voting unitholders have approved the sale of substantially all of the assets of the Fund to certain affiliates of General Shale Brick, Inc. ("General Shale"). Unitholders also approved related amendments to the Declaration of Trust of the Fund. The transaction and related amendments received the approval of more than 87% of the votes cast by or on behalf of all voting unitholders at the meeting, as well as the approval of more than 84% of the votes cast by or on behalf of "minority" unitholders for purposes of Ontario Securities Commission Rule 61-501 and Regulation Q-27 of the Autorité des marchés financiers du Québec.
Under terms of the agreement with General Shale, affiliates of General
Shale will acquire the Fund's wholly owned subsidiaries, Arriscraft
International Limited Partnership and Arriscraft International Holdings
(Canada) Inc., which, respectively, operate and hold the Arriscraft
International business in Canada and the United States, for an aggregate price
of $107,000,000, subject to closing adjustments for debt and non-cash working
capital. The Fund will be responsible to pay transaction and wind-up related
expenses out of the sale proceeds received from General Shale.
The transaction is expected to close on Friday, July 20, 2007. Following
the closing of the transaction, the bulk of the proceeds will be paid to the
Fund's unitholders through the redemption of all outstanding Fund units.
Primarily as a result of lower than expected debt levels, the Fund is
currently expecting that the cash redemption price will exceed $7.50 per unit.
A final calculation of the redemption price will be provided following
closing.
The final redemption price per unit will depend on purchase price
adjustments, transaction costs and expenses associated with the wind-up of the
Fund. To the extent price adjustments, transaction costs and wind-up expenses
are different from the Fund's estimates, or if any unforeseen adjustments,
costs or expenses arise, the actual amount paid to unitholders could be
different.
The actual date of the redemption of the units will be set and announced
following the closing of the sale transaction. Assuming the closing is
completed on July 20, 2007, delisting and redemption of the units will occur
on July 23 and July 24, 2007, respectively. At that time, the corporate
trustee of the Fund will assess the potential for any other further costs,
obligations or liabilities (including tax liabilities) that must be met to
wind-up the Fund. It is intended that a reserve will be established for such
amounts out of the estimated redemption price per unit noted above. On the
redemption of the Fund units, all sale proceeds available after the
adjustments, costs and expenses noted above and in excess of the reserve,
which reserve is currently estimated to be approximately $0.20 per unit, will
be distributed to unitholders. The reserve funds, net of any amount paid to
satisfy any valid Fund costs, obligations and liabilities after closing, of
which none is currently known or expected, will be paid to Fund unitholders as
the balance of their unit redemption price in due course once all regulatory
filings and tax clearance certificates have been completed or obtained.
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Honda Aero to Build Headquarters, Manufacturing Plant to Produce New Turbofan Jet Engines
$27 Million Plant to Produce GE Honda Engines for Very Light Jet Market
BURLINGTON, NC - Honda Aero, Inc., announced today that it will establish its corporate headquarters and a state-of-the-art jet engine manufacturing plant in Burlington, North Carolina. The new facility will produce advanced jet engines developed and marketed by GE Honda Aero Engines, LLC.
GE Honda Aero Engines is a joint venture between GE and Honda Aero,
established in 2004 for the development, certification and commercialization
of jet engines in the 1,000- to 3,500-pound thrust class.
The 102,400-square foot Honda Aero facility will consist of 36,000 square
feet of office space, a 58,400-square foot production plant, and an
8,000-square foot engine test cell. Production at the new engine plant will
begin in late 2010 with the manufacture of the advanced and efficient GE Honda
HF120 turbofan engine in the 2,000-pound thrust class.
Honda Aero will employ approximately 70 associates when the plant reaches
its initial production plan of 200 engines per year within about one year of
production startup. The company will invest approximately $27 million (U.S.)
for construction of the headquarters and manufacturing facility, including
equipment.
"This is a major step forward for our company, as we move to establish
the home of our jet engine manufacturing operations here in Burlington," said
Fumitaka Hasegawa, president and CEO of Honda Aero, Inc.
With a higher thrust-to-weight ratio, higher fuel efficiency, low
emissions and the quietest operation in its thrust class, the GE Honda HF120
has been chosen to power two of the newest and most advanced products in the
business jet market - Spectrum Aeronautical's Freedom jet and HondaJet, to be
produced by the Honda Aircraft Company, Inc., a separate Honda company.
The HF120 is a higher thrust successor to Honda's original HF118
prototype engine, which has accumulated more than 4,000 hours of testing on
the ground and in-flight. Honda research on jet engine technology started in
1986, with development of the HF118 engine beginning in the late 1990s.
GE-Honda collaboration on the HF120 began in early 2005. The first core test
of the GE Honda HF120 was conducted in early 2007, followed by full-engine
testing later in the year.
Combining Honda's original small turbofan engine technology and GE's 60
years of experience in the development and manufacture of jet engines, the GE
Honda HF120 is the most fuel-efficient engine in its class. Although there are
currently no emission regulations for small turbofan engines, the HF120 is
expected to surpass the future anticipated emissions standards by as much as
20 percent.
Honda Aero, Inc. is a wholly-owned subsidiary of Honda Motor Co., Ltd.,
the world's preeminent maker of engines for automobiles, motorcycles and power
equipment. With 130 manufacturing facilities in 29 countries worldwide, Honda
now attracts more than 20 million customers annually. Honda Canada
manufactures the Honda Ridgeline and Civic, and the Acura CSX and MDX at its
two plants in Alliston, Ontario. A new, third plant in Alliston, with the
capacity to produce up to 200,000 efficient 4-cylinder engines annually, is
scheduled to open in 2008.
|
Manufacturing Remained Steady in May 2007
Statscan - After a slight decrease in April, manufacturing shipments remained virtually unchanged in May (-0.1%) at $49.7 billion. Manufacturing shipments had trended slowly downwards throughout most of 2006, before posting a strong first quarter in 2007.
Manufacturers continued to face several challenges during May. The Canadian dollar appreciated significantly against its American counterpart, reaching a 30-year high by the end of May. In addition, the Labour Force Survey reported a 0.6% drop in manufacturing employment during the month, a loss of 12,300 jobs.
Despite these challenges, the volume of manufacturing shipments, using constant dollars, rose 0.4% to $45.5 billion. After increasing in seven of the last eight months, constant dollar shipments reached their highest level since the beginning of 2006. The constant dollar measurement takes price fluctuations into account, providing an indicator of the volume of shipments during the month.
On a sector by sector basis, only 9 of 21 manufacturing industries decreased in May, but they represented about 57% of total shipment outputs.
Durable goods were the main source of weakness in May, declining 1.2% to $26.7 billion, following a sharper loss of 2.0% the previous month. Among durable goods producers, primary metal manufacturers posted one of the most significant declines during the month.
On the other hand, shipments of non-durable goods continued to strengthen, especially in resource-based industries. Manufacturers of petroleum and coal products, chemical products, and plastic and rubber products pushed non-durable good shipments up 1.2%, the fourth consecutive monthly increase.
Unfilled factory orders continued to increase, rising 1.8% in May for an eighth consecutive monthly gain. Unfilled orders can be used as an indicator of probable future shipments. New orders, which may include orders received and shipped during the month, slipped 0.5%.
Note to readers
Preliminary estimates are provided for the current reference month. Estimates, based on late responses, are revised for the three prior months.
Non-durable goods industries include food, beverage and tobacco products, textile mills, textile product mills, clothing, leather and allied products, paper, printing and related support activities, petroleum and coal products, chemicals, and plastics and rubber products.
Durable goods industries include wood products, non-metallic mineral products, primary metals, fabricated metal products, machinery, computer and electronic products, electrical equipment, appliances and components, transportation equipment, furniture and related products and miscellaneous manufacturing.
Unfilled orders are a stock of orders that will contribute to future shipments assuming that the orders are not cancelled.
New orders are those received whether shipped in the current month or not. They are measured as the sum of shipments for the current month plus the change in unfilled orders. Some people interpret new orders as orders that will lead to future demand. This is inappropriate since the "new orders" variable includes orders that have already been shipped. Readers should note that the month-to-month change in new orders may be volatile. This will happen particularly if the previous month's change in unfilled orders is closely related to the current month's change.
Not all orders will be translated into Canadian factory shipments because portions of large contracts can be subcontracted out to manufacturers in other countries. Also, some orders may be cancelled.
Primary metal manufacturers take a break
After four months of strong gains, primary metal manufacturers reported a 4.1% decrease in shipments during May. Demand in Asia for primary metal products combined with rising prices had steadily pushed shipment values higher since the beginning of 2007. However, a two-week shutdown of a major manufacturing plant, combined with a 1.2% drop in prices compared with April, had a dampening effect on the industry in May.
Transportation equipment manufacturers posted mixed results in May, edging down 1.3%. Motor vehicle shipments slipped an additional 1.2% in May after a sizeable 11.9% decrease in April. A rail strike earlier in 2007 resulted in some subsequent volatility within the industry. Automotive parts shipments also decreased (-2.9%), following a similar-sized drop in April. Temporary plant shutdowns as well as a plant closure in May had an impact on the results for automotive parts manufacturers.
Shipments of aerospace products and parts were a bright spot in the transportation industry, reversing April's decrease with an 8.7% surge in May. Shipments within this sector have been trending upward since the beginning of 2006.
Petroleum and coal manufacturers reported a 4.1% increase in shipments, a fifth consecutive monthly gain. Shipments had eased slightly in the fall of 2006 as prices pulled back somewhat. However, shipments in May rose close to the record levels last seen in the summer of 2006, in part due to price increases in recent months.
Strength in the Prairie Provinces balances weaker results in the East
A strong performance in the Prairie Provinces helped to balance out what was an otherwise lacklustre May for manufacturers in Central and Eastern Canada. Nationally, six provinces experienced a drop in total manufacturing shipments.
Manufacturers in the Prairie Provinces showed strength, posting a 3.5% gain in shipments, offsetting the 2.6% loss the previous month. Alberta led the way with a robust 3.7% jump to $5.7 billion on the strong performances in computers and electronics (+22.7%), non-metallic minerals (+8.8%), and petroleum and coal products (+8.5%).
Shipments from Manitoba and Saskatchewan both moved ahead 3.1% in May. Manitoba's shipment growth of $40 million regained some of the $136 million (-9.6%) lost in April. The gain was fuelled by the transportation and primary metal sectors, the industries that were responsible for the previous month's drop. For Saskatchewan, the largest sector, food products, was propelled upward 6.4% on the strength of oilseed processing.
Manufacturers in Quebec saw shipments decrease 1.0% in May. This was the first monthly loss recorded by the province since January. Primary metals (-8.3%) and paper products (-4.8%) were significant contributors to the deceleration in Quebec's strong shipment growth.
Ontario's manufacturing shipments decreased 0.2% to $23.9 billion, with 12 of 21 industry sectors reporting losses.
Resource-based manufacturing was at the core of shipment decreases in British Columbia (-2.2%) and Atlantic Canada (-3.1%) in May. In British Columbia, wood products dropped 6.2%, putting a damper on the largest sector in the province.
For Atlantic Canada, New Brunswick manufacturers had a particularly weak month. Provincial shipments declined by 6.0%, due to a combination of declines in resource-based sectors, including petroleum and coal products, primary metals and food products.
| Manufacturing shipments, provinces and territories |
| |
April 2007r |
May 2007p |
April to May 2007 |
| |
Seasonally adjusted |
| |
$ millions |
% change |
| Canada |
49,722 |
49,674 |
-0.1 |
| Newfoundland and Labrador |
234 |
249 |
6.4 |
| Prince Edward Island |
129 |
123 |
-4.7 |
| Nova Scotia |
776 |
767 |
-1.1 |
| New Brunswick |
1,205 |
1,133 |
-6.0 |
| Quebec |
12,237 |
12,111 |
-1.0 |
| Ontario |
23,964 |
23,926 |
-0.2 |
| Manitoba |
1,278 |
1,318 |
3.1 |
| Saskatchewan |
835 |
861 |
3.1 |
| Alberta |
5,474 |
5,674 |
3.7 |
| British Columbia |
3,578 |
3,500 |
-2.2 |
| Yukon |
3 |
2 |
-19.8 |
| Northwest Territories including Nunavut |
9 |
10 |
16.0 |
|
Unfilled orders surge for aerospace manufacturers
Manufacturers' backlog of orders continued to swell, increasing by 1.8% in May to $49.1 billion. This was the eighth consecutive monthly increase in unfilled orders, which may be considered as an indicator of the future strength of manufacturing shipments.
The trend for unfilled orders has been steadily improving since last summer, increasing almost 20% since May 2006. However, excluding aerospace products and parts, unfilled orders have increased only 1.1% in the past year.
Unfilled orders for aerospace products and parts jumped 4.0% to 21.2 billion, the highest level since March 2002. In May, unfilled orders for the aerospace industry were up about 56% compared with May 2006.
Manufacturers in the miscellaneous group also saw unfilled orders continue to surge in May, gaining 22.3% compared with April. This was the sixth increase in unfilled orders in the past seven months. Unfilled orders in this industry have almost doubled since December 2006, largely because of strength in medical equipment and supplies manufacturing.
One of the primary offsetting factors for unfilled orders in May was a pull back in computer and electronic products and parts. Unfilled orders had surged 8.2% in April, but fell back 4.7% in May to $3.4 billion.
New orders edge down
New orders edged down 0.5% in May to $50.5 billion. After surging in December 2006, new orders have largely stabilized around $50 billion in 2007, experiencing only modest month-to-month fluctuations.
Computer and electronic products contributed the largest decrease to new orders in May, plummeting 27.7% after a 24.1% increase in April.
On the other hand, new orders of aerospace products and parts jumped 18.5% after remaining largely unchanged in April.
Inventory levels decrease slightly
Inventory levels decreased 0.4% to $62.9 billion following two months of minimal increases. Inventories have eased down slightly in the past six months after rising considerably between January 2005 and September 2006.
In total, 10 of 21 industries reported a decrease to their inventories in May. Manufacturer's total inventories decreased slightly, largely due to declines in three industries. The sharpest decrease was an 8.8% drop in motor vehicle inventories. Computer and electronic products manufacturers (-5.3%) and primary metal manufacturers (-1.9%) also reported notable inventory declines.
Inventory-to-shipment ratio remains steady
The inventory-to-shipment ratio remained unchanged in May at 1.27. The ratio had reached a recent low of 1.25 in March after peaking at a three-year high of 1.33 in October 2006. Over the past five years, the inventory-to-shipment ratio has ranged between 1.22 and 1.38. May's result was slightly below the five-year average of 1.28.
The inventory-to-shipment ratio is a key measure of the time, in months, that would be required to exhaust inventories if shipments were to remain at their current level.
| Shipments, inventories and orders in all manufacturing industries |
| |
Shipments |
Inventories |
Unfilled orders |
New orders |
Inventories-to-shipments ratio |
| |
Seasonally adjusted |
| |
$ millions |
% change |
$ millions |
% change |
$ millions |
% change |
$ millions |
% change |
|
| May 2006 |
48,422 |
-0.7 |
62,516 |
0.8 |
41,180 |
-0.6 |
48,185 |
0.5 |
1.29 |
| June 2006 |
49,356 |
1.9 |
62,132 |
-0.6 |
41,298 |
0.3 |
49,474 |
2.7 |
1.26 |
| July 2006 |
49,805 |
0.9 |
62,898 |
1.2 |
41,485 |
0.5 |
49,992 |
1.0 |
1.26 |
| August 2006 |
49,326 |
-1.0 |
62,935 |
0.1 |
41,207 |
-0.7 |
49,048 |
-1.9 |
1.28 |
| September 2006 |
47,791 |
-3.1 |
63,302 |
0.6 |
41,202 |
0.0 |
47,786 |
-2.6 |
1.32 |
| October 2006 |
47,701 |
-0.2 |
63,303 |
0.0 |
41,403 |
0.5 |
47,903 |
0.2 |
1.33 |
| November 2006 |
48,703 |
2.1 |
63,370 |
0.1 |
42,192 |
1.9 |
49,493 |
3.3 |
1.30 |
| December 2006 |
49,572 |
1.8 |
62,652 |
-1.1 |
43,523 |
3.2 |
50,976 |
3.0 |
1.26 |
| January 2007 |
48,368 |
-2.4 |
62,840 |
0.3 |
44,633 |
2.6 |
49,478 |
-2.9 |
1.30 |
| February 2007 |
48,480 |
0.2 |
62,626 |
-0.3 |
46,705 |
4.6 |
50,552 |
2.2 |
1.29 |
| March 2007 |
50,057 |
3.3 |
62,706 |
0.1 |
47,132 |
0.9 |
50,484 |
-0.1 |
1.25 |
| April 2007 |
49,722 |
-0.7 |
63,166 |
0.7 |
48,219 |
2.3 |
50,808 |
0.6 |
1.27 |
| May 2007 |
49,674 |
-0.1 |
62,891 |
-0.4 |
49,078 |
1.8 |
50,534 |
-0.5 |
1.27 |
| Manufacturing industries except motor vehicle, parts and accessories |
| |
Shipments |
Inventories |
Unfilled orders |
New orders |
| |
Seasonally adjusted |
| |
$ millions |
% change |
$ millions |
% change |
$ millions |
% change |
$ millions |
% change |
| May 2006 |
41,260 |
-0.3 |
59,791 |
0.8 |
38,448 |
-0.7 |
41,004 |
1.0 |
| June 2006 |
41,966 |
1.7 |
59,464 |
-0.5 |
38,722 |
0.7 |
42,239 |
3.0 |
| July 2006 |
42,448 |
1.2 |
59,959 |
0.8 |
38,988 |
0.7 |
42,715 |
1.1 |
| August 2006 |
42,103 |
-0.8 |
60,119 |
0.3 |
38,965 |
-0.1 |
42,080 |
-1.5 |
| September 2006 |
40,959 |
-2.7 |
60,394 |
0.5 |
39,271 |
0.8 |
41,265 |
-1.9 |
| October 2006 |
40,996 |
0.1 |
60,345 |
-0.1 |
39,860 |
1.5 |
41,585 |
0.8 |
| November 2006 |
41,217 |
0.5 |
60,483 |
0.2 |
40,869 |
2.5 |
42,225 |
1.5 |
| December 2006 |
41,538 |
0.8 |
59,872 |
-1.0 |
42,317 |
3.5 |
43,063 |
2.0 |
| January 2007 |
40,988 |
-1.3 |
59,980 |
0.2 |
43,329 |
2.4 |
42,001 |
-2.5 |
| February 2007 |
41,029 |
0.1 |
59,818 |
-0.3 |
45,486 |
5.0 |
43,185 |
2.8 |
| March 2007 |
42,001 |
2.4 |
59,952 |
0.2 |
46,016 |
1.2 |
42,532 |
-1.5 |
| April 2007 |
42,421 |
1.0 |
60,406 |
0.8 |
47,044 |
2.2 |
43,449 |
2.2 |
| May 2007 |
42,501 |
0.2 |
60,213 |
-0.3 |
47,876 |
1.8 |
43,333 |
-0.3 |
|
Brick Brewing secures important packaging and representation agreement
WATERLOO - Brick Brewing Co. Limited announced that it has entered into an agreement with Cadbury Beverages Canada Inc. to manufacture, package and represent the popular Motts Caesar alcohol based beverages.
Under terms of the agreement, Brick will also provide sales
representation for Motts Caesar in the key Ontario market.
|
Krug Receives GREENGUARD Certification for Jordan
Kitchener Krug is excited to announce that Jordan Healthcare Seating products are now GREENGUARD Indoor Air Quality Certified® by the GREENGUARD Environmental Institute (GEI).
Jordan earned GREENGUARD Certification after meeting GEI’s stringent testing requirements
for indoor air quality standards for low emitting products.
This certification was devised to limit the exposure to the chemical emissions that are often
released from interior furnishings and manufacturing materials. Architects and Designers can
specify GREENGUARD Certified seating in order to achieve points for the U.S. Green Building
Council’s Leadership in Energy and Environmental Design (LEED) Rating System.
“Our continued focus on environmental sustainability has now been recognized with our newest
seating line Jordan. This collection transcends conventional healthcare seating, achieving a
heightened level of aesthetic beauty, and delivers long-term sitting comfort and ergonomic
support,” says, Len Ruby, Krug President.
As a leading designer and producer of office furnishings Krug has become one of the industry’s
fastest growing and most dynamic furniture companies. Krug offers a range of private and
conferencing solutions and a comprehensive seating collection.
|
Further manufacturing job loss casts shadow over summer
TORONTO - National employment statistics for June released by Statistics Canada present the most troubling picture yet for the Canadian manufacturing sector.
"Our economy lost 31,000 good paying, stable manufacturing jobs in one
month alone," said CAW President Buzz Hargrove. "This should be setting off
alarm bells on Parliament Hill."
In the last 12 months, Canada has lost an estimated 103,000 manufacturing
jobs. While employment in other areas may be on the rise, new jobs are
primarily found in the retail and wholesale sectors beset with low-wages and
few benefits.
According to Hargrove, this poses serious challenges for Canada's youth.
"For young people finishing school, today's economy offers them little
opportunity to work in dynamic industries which would secure them a decent
future," said Hargrove.
In the last five years, young workers, (defined as under 24 by Statistics
Canada), have lost more manufacturing jobs than any other age group. Since
2002, manufacturing jobs for youth have declined by 45,300, or by almost 20
per cent.
"It's time the federal government stops putting Canadians out of work and
comprising the future of our youth with a high dollar and unbalanced trade,"
said Hargrove.
|
ATS files final prospectus for $110 million rights offering
CAMBRIDGE - ATS Automation Tooling Systems Inc. today announced that it has filed a final short form prospectus in relation to its previously announced $110 million rights offering (the "Rights Offering"). The Rights Offering provides existing common shareholders with rights (the "Rights") exercisable to subscribe for additional common shares in ATS. The offering is expected to raise net proceeds of approximately $103 million. Rights and Subscription Price: Each shareholder of record of the Company on July 19, 2007 will receive one Right for each common share held. For every 3.35 Rights held, the holder will be entitled to purchase one common share at the price of $6.23 until 5:00 P.M. (Toronto time) on August 14, 2007 (the "Expiry Date").
Discount to Market Price: The subscription price of $6.23 per share
represents a discount of 32% per cent to the closing price of $9.13 per share
on July 5, 2007.
Additional Subscription Privilege: Holders of Rights who fully exercise
their Rights are entitled to subscribe pro rata for additional common shares,
if available, that were not subscribed for initially, on or before the Expiry
Date.
Trading Information: The Rights will commence trading on the TSX on
July 17, 2007, under the symbol "ATA.RT" and the common shares will commence
trading on an ex rights basis, meaning that persons purchasing common shares
on or following that date will not be entitled to receive the related Rights.
Trading of the Rights will continue until noon (Toronto time) on the Expiry
Date. The Company's common shares trade on the TSX under the symbol ATA.
Distribution of Rights Certificates: Certificates representing the Rights
(the "Certificates") will be mailed to registered shareholders located in each
of the provinces of Canada and in the United States (the "Eligible
Jurisdictions") following the record date of July 19, 2007. Subject to certain
exceptions, Certificates will not be mailed to registered shareholders located
outside of the Eligible Jurisdictions. Such shareholders will not be permitted
to exercise their Rights and in certain cases the rights agent engaged by the
Company will attempt to sell such Rights on behalf of the relevant class of
shareholders. Shareholders should consult the final prospectus and their
financial advisors to determine their rights and entitlements under the Rights
Offering. A Registration Statement on Form F-7 has also been filed in the
United States under the United States Securities Act 1933 (the "1933 Act")
which will allow United States shareholders to participate in the Rights
Offering.
Mailing of Final Prospectus: The final prospectus will be mailed along
with the Certificates to registered shareholders beginning on or about
July 24, 2007. Shareholders wishing to exercise their Rights must forward the
completed Certificate along with the applicable funds to Computershare
Investor Services Inc. by the Expiry Date. Shareholders requiring additional
information may refer to a copy of the final short form prospectus available
on SEDAR at www.sedar.com.
Enquiries: Enquiries should be addressed to Computershare Investor
Services Inc. by telephone at 1-800-564-6253 or the Company at (519) 650-6501.
Use of Proceeds: The net proceeds of the Rights Offering will be used to
further expand the manufacturing capacity at Photowatt International S.A.S.
("Photowatt France"), to procure silicon supplies, to advance research and
development and for general corporate purposes all at Photowatt France, as
further described in the final short form prospectus.
The above summary of the principal terms of the Rights Offering should be
read together with, and is qualified in its entirety by, the more detailed
information contained in the final short form prospectus.
|
ATS awarded US$14.3 million order for pharmacy packaging automation
CAMBRIDGE - ATS Automation Tooling Systems Inc. announced it has been awarded a US$14.3 million order to design, build, install and support a number of automated packaging systems for a market-leading healthcare company.
This significant order, incorporating robotics, automated material
handling systems and ATS SmartVision technology, involves a number of systems
that are scheduled to be delivered and installed at a number of different
customer production sites throughout North America. The delivery of the first
system is scheduled for the end of calendar 2007 while the balance of the
order is planned for delivery in calendar 2008. The name of the customer
cannot be released due to customer confidentiality.
"The order obtained today is a valued win for us because it comes from a
new customer for ATS, a customer with a strong market position and ambitious
growth plans for the future," said Ron Jutras, ATS President and CEO. "As
such, we expect this first program to be the start of a valued long-term
business relationship between our companies. Our selection for this highly
strategic assignment demonstrates the value of our breadth of capabilities,
services, relevant experience, size and excellent reputation in our industry
and markets."
|
Prices Charged by Manufactures Decline May 2007
Statscan - Influenced by the strength of the Canadian dollar, prices for manufactured products declined in May after six consecutive monthly increases. Crude oil pushed down prices for raw materials.
From April to May, prices charged by manufacturers, as measured by the Industrial Product Price Index (IPPI), registered a 0.5% decline after six consecutive monthly increases. The decrease in prices basically reflects a drop in the prices for motor vehicles and other transportation equipment as well as primary metal products and pulp and paper products. However, higher prices for petroleum and coal products tempered the decline in the Industrial Product Price Index.
On a 12-month basis, the IPPI advanced 3.0%, a slowdown from the 3.8% increase registered in April. The upward pressure came mainly from higher prices for primary metal products and, to a lesser extent, increased prices for chemical products and petroleum and coal products. The upward movement was slowed by a drop in prices for lumber and other wood products and motor vehicles.
The Raw Materials Price Index (RMPI) declined 0.2% from April to May after registering three consecutive monthly increases. The month-over-month decline in the index is mainly attributable to mineral fuels and ferrous materials, while non-ferrous metals continued their rise for a third consecutive month.
Compared with May of last year, raw materials cost plants 1.9% more, which represents a slowing in comparison with the 8.0% rate of increase recorded in April. The rise in the index was mainly led by non-ferrous metals and was slowed by mineral fuels.
In May, the IPPI was 117.7 (1997=100), down from April's revised level of 118.3. The RMPI was 173.7 (1997=100), down from April's revised level of 174.0.
IPPI: Petroleum and coal products slowed the decline of industrial prices
The month-over-month decrease in manufacturers' prices was led mainly by the decline in prices for motor vehicles and other transportation equipment and, to a lesser extent, the prices for primary metal products and pulp and paper products. However, the decline in the total index was dampened by higher prices for petroleum and coal products.
Prices for motor vehicles declined 2.2%, the largest monthly drop in 30 months. With the Canadian dollar rising in value against its U.S. counterpart, and where automobile manufacturers' sales are denominated in U.S. dollars, the prices for motor vehicles underwent a devaluation in Canadian dollars.
Prices for primary metal products declined 1.2% in May after rising in the previous three months. Aluminum prices fell 3.5% in conjunction with 8 consecutive months of rising inventories on the London metals market. Aluminum is especially vulnerable to the slowdown in the construction and automobile manufacturing industries in the United States. Prices for copper and copper alloys fell 2.7%. Copper prices corrected themselves after their strong growth in the previous three monthsespecially in April, when they surged 12.0%and in anticipation of a copper surplus in 2007. Prices for precious metal basic manufactured shapes dropped 7.9%.
Prices for pulp and paper products declined 2.0%, their third consecutive monthly decline. The index for newsprint and other printing paper reached its lowest level in 38 months. Weak American demand for newsprint had a negative effect on prices.
The drop in the Industrial Product Price Index was eased by higher prices for petroleum and coal products, which rose 2.7% after three robust monthly increases. The continuing low level of international petroleum inventories, combined with forecasts of excess demand, maintained upward pressure on prices for petroleum products. If the prices for petroleum and coal products had been excluded, the IPPI would have declined 0.9% instead of 0.5%.
IPPI: Primary metals continue to lead the 12-month change
The IPPI rose 3.0% from May 2006 to May 2007 and the index continued to slow for a second month. The IPPI was pushed up by rising prices for primary metals and, to a lesser extent, by higher prices for chemical products, petroleum and coal products, meat, fish and dairy products, and fruit, vegetables and feed products. The 12-month IPPI excluding petroleum and coal grew at a slower pace than in previous months. If the prices for petroleum and coal products had been excluded, the increase in the IPPI compared to May 2006 would have been the same, namely 3.0%.
Primary metal prices were up 10.9% compared to May 2006, nearly half the rate of increase posted in April. Most of the year-over-year increase came from higher prices for nickel products, which rose 132.1%. Prices remained high, primarily because of very low inventories, the result of demand largely exceeding the pace of production. On the other hand, the prices for aluminum and copper products were down 9.8% and 7.3%, respectively.
The annual rate of growth in the IPPI was slightly diminished by lower prices for lumber and other wood products (-4.5%) and motor vehicles (-1.0%).
RMPI: Mineral fuel prices decline and non-ferrous metal prices rise
The prices for raw materials declined 0.2% in May, their first drop after three consecutive monthly increases. The RMPI was pulled down by lower prices for mineral fuels and ferrous materials. Increased prices for non-ferrous metals tempered the decline in the total index for raw materials.
Mineral fuels fell 1.2% owing to a 1.5% drop in the price for crude oil. Without mineral fuels, the RMPI would have risen 0.7% from April, rather than declining 0.2%.
Prices for ferrous materials dropped 5.6%. In particular, the prices for iron and steel wastes fell 6.8% because of weak demand from the auto sector in the United States.
A 2.2% increase in non-ferrous metal prices dampened the decrease in the Raw Materials Price Index. In particular, radioactive concentrates and zinc concentrates posted gains of 6.8% and 6.6%, respectively.
On a 12-month basis, prices for raw materials rose 1.9% in May, down sharply from 8.0% in April. An 11.8% drop for mineral fuels put a brake on the growth of the prices for raw materials. Without mineral fuels, the RMPI would have increased 17.0% instead of 1.9%.
Non-ferrous metals accounted for most of the 12-month increase, with prices rising 29.7%, mainly on the strength of year-over-year increases in the prices for radioactive concentrates and concentrates of lead, nickel and zinc.
Prices were also up over the previous year in the case of wood (+13.1%), animals and animal products (+7.2%), vegetable products (+15.4%) and ferrous materials (+6.0%).
Impact of the exchange rate
The value of the Canadian dollar against the U.S. dollar rose 3.6% from April to May. Without the effect of the exchange rate, the IPPI would have increased by 0.5% instead of declining by 0.5%.
On a 12-month basis, the value of the Canadian dollar rose 1.3% against the U.S. dollar. If the impact of the exchange rate had been excluded, producer prices would have risen 3.3% instead of 3.0% between May 2006 and May 2007.
Prices for intermediate goods post first decline after seven consecutive monthly increases
Prices for intermediate goods fell 0.5% between April and May, their first decline after seven consecutive monthly increases. The drop in prices was broad-based, affecting most products except petroleum and coal products and chemical products. The major contributors to the decline were primary metal products, pulp and paper products, lumber and other wood products, and motor vehicles.
Producers of intermediate goods received 4.1% more for their products in May than in May 2006. The majority of the increase came from primary metal products and, to a lesser extent, chemical products, fruit, vegetables and feed products, meat, fish and dairy products, petroleum and coal products, metal fabricated products, and pulp and paper products. On the other hand, prices for lumber, motor vehicles and electrical and communication products slowed the year-over-year increase.
Prices for finished products pulled down by motor vehicle prices
From April to May, prices for finished products fell 0.5% for a second consecutive month as a result of a decrease in prices for motor vehicles, a sector that is more sensitive to exchange rate changes. While the decline in finished products was broad-based across the range of products, few products made a significant contribution other than motor vehicles and other transportation equipment. The decrease in finished product prices was partly offset by higher prices for petroleum and coal products.
Since May 2006, prices for finished products have risen 1.2%. Higher prices were observed for petroleum products, meat, fish and dairy products, tobacco products, chemical products, fruit, vegetables and feed products, and beverages. The increase in prices for finished goods was slowed by lower prices for motor vehicles and machinery and equipment.
Note to readers
The Industrial Product Price Index (IPPI) reflects the prices that producers in Canada receive as the goods leave the plant gate. It does not reflect what the consumer pays. Unlike the Consumer Price Index, the IPPI excludes indirect taxes and all the costs that occur between the time a good leaves the plant and the time the final user takes possession of it, including the transportation, wholesale, and retail costs.
Canadian producers export many goods. They often quote their prices in foreign currencies, particularly for motor vehicles, pulp, paper, and wood products. Therefore, a rise or fall in the value of the Canadian dollar against its U.S. counterpart affects the IPPI.
The Raw Materials Price Index (RMPI) reflects the prices paid by Canadian manufacturers for key raw materials. Many of these prices are set in a world market. Unlike the IPPI, the RMPI includes goods not produced in Canada.
|
The Canadian Manufacturing Hall of Fame (CMHOF) announced its 2007 inductees
Linamar Founder Frank Hasenfratz Inducted with host of other great contributors
WINDSOR, ON - The Canadian Manufacturing Hall of Fame (CMHOF) announced its 2007 inductees.
The vision and tenacity of these giants in industry have helped shape
Canada's economy and their induction into the CMHOF will serve as a permanent
testimony to future generations of their outstanding contributions.
"As a country we are blessed with a depth of talented individuals who
have worked to see their vision become a reality," says The Honourable Perrin
Beatty, President and CEO of the Canadian Chamber of Commerce, and Honourary
Chairman of the Canadian Manufacturing Hall of Fame. "It is important to
profile and remember the people who have left a legacy of innovation,
perseverance and commitment to excellence for all Canadians and have as well
made a huge impression on the world. This year's inductees reflect the depth
and diversity of manufacturing that is at the very heart of the Canadian
economy. I believe their induction will serve as a powerful reminder of just
how proud we are of our Canadian manufacturing heritage."
The 2007 Canadian Manufacturing Hall of Fame Inductees are:

Frank J. Hasenfratz
Founder, Linamar Corporation
Guelph, Ontario
Induction Category: Founder - Born in Hungary in 1935, Frank Hasenfratz attended trade and engineering technical schools, while working as a toolmaker and machinist. He immigrated to Canada in 1957 and was a supervisor at Sinterings Ltd. In 1966 Mr. Hasenfratz founded Linamar Corporation which is located in Guelph, Ontario. Linamar is a global manufacturer and supplier of leading edge solutions to the automotive and industrial markets. Linamar operates 36 plants around the world, has over 10,000 employees and generated sales close to $2.3 billion in 2006. Linamar is the only company in the world currently producing every machined component in the vehicle for the automotive industry. Mr. Hasenfratz, chairman of the company, focuses on cost reduction programs, productivity improvements and strategic decisions within the company while his daughter, Linda Hasenfratz is the Chief Executive Officer.
Frank Hasenfratz received both the Ontario and Canadian 1994 Entrepreneur of the Year Awards in the manufacturing / High-Tech category. In November, 2006 he was awarded the Knight?s Cross of the Order of Merit by the Republic of Hungary.

Peter Hedgewick
Founder, International Tool Limited
Windsor, Ontario
Induction Category: Founder / Innovator - Peter Hedgewick, the 92 year old talented, far-sighted and volatile founder of International Tool Limited (ITL) was a key figure in the development of the Canadian and North American mold industry. Peter learned his trade at Windsor Tool & Mould and in 1944 he founded ITL. ITL started in a two-car garage and over the next 43 years it grew to an 800 employee operation. The company was largely focused on supplying the automotive industry.
Peter Hedgewick, was enlisted by Dr. Henri Breault, a Windsor pediatrician, to create the first child-resistant safety cap for prescription bottles in 1967. The "Palm-N-Turn" technology, which is still being used today, requires users to push down while turning. By 1974, Ontario had made the use of child-resistant packaging mandatory for certain products. Similar regulations were quickly adopted internationally. The incidents of child poisonings quickly dropped by 91%.
A significant number of people trained at ITL started their own operations. On May 13 - 15, 2004, at the 6th Annual National Conference of the Innovation Systems Research Network at Simon Fraser University, Vancouver B.C. a case study estimated that as many as 80% of the current mould shops in Windsor trace their roots back directly or indirectly to ITL.

Gene H. Kruger(*)
Leadership, President & CEO, Kruger Inc.
Montreal, Quebec
Induction Category: Leadership - Gene Kruger transformed a modest family company, which was founded by his father, Joseph Kruger, into a globally competitive paper manufacturer. He joined the family business after attending McGill University. After the death of his father in 1928, Gene became president of the company and remained at the helm for 60 years. Under his leadership, the company saw spectacular growth. He was renowned for his management skills and the ability to turn around mills headed for bankruptcy. Mr. Kruger extended the family interests to an international level through the purchase and construction of tissue paper mills in Venezuela and Colombia. While Kruger's main passion remained the paper industry he also made important breakthroughs in aluminum manufacturing. Today Kruger Inc. employs over 10,500 people internationally under the leadership of Gene Kruger's son, Joseph Kruger II.

Gordon M. McGregor(*)
Founder, Ford Motor Company Canada
Induction Category: Founder - The Walkerville Wagon Company Limited located in Windsor, Ontario was a partnership between father and son, William McGregor and Gordon McGregor. Gordon McGregor took over the Presidency of the company in 1903 after the death of his father. On August 10th, 1904 Gordon McGregor signed the agreement which allowed him to form and finance a company to manufacture and sell Ford products in Canada. Production of Ford automobiles in Canada started in the Wagon Works on October 10, 1904 and by the end of the calendar year, 25 cars has been assembled. In the beginning Gordon was known to take a newly assembled car out on the road ? sell it and return by train. Gordon McGregor steadily built his dream and today Ford of Canada has become one of the largest industrial organizations in this country.
Gordon gave of himself not just to the business but also to his community and national interests. By 1922 the company had expanded and produced 51,341 cars in one fiscal year, which resulted in almost seven out of ten cars sold in Canada being built by Ford of Canada. Gordon saw his company become the first automobile manufacturer in Canada to build the complete automobile from raw materials to the finished product. Gordon McGregor passed away when he was only 49 years old but his influence has continued through those he trained who went on to make the company what it is today.

R. Samuel McLaughlin.(*)
Founder, General Motors of Canada
Induction Category: Founder - Robert Samuel McLaughlin was an important Canadian businessman, philanthropist and founder. In 1887 Robert started his career at the age of 16 as an apprentice upholsterer in his father?s company, McLaughlin Carriage Workers, a manufacturer of horse-drawn buggies and sleighs. Mr. McLaughlin?s talents and willingness to work hard moved him up the company ladder, and he began designing carriages.
Samuel took his first car ride in 1904 and was fascinated by the "horseless carriages". The McLaughlin Motor Car Company was founded in 1907, and in its first full year of operation, they produced 154 cars. In 1910, Mr. McLaughlin became a member of the Board of Directors of General Motors. He sold his company to General Motors in 1918 and it was incorporated as General Motors Canada, with Mr. McLaughlin as President. Mr. McLaughlin retained this post until 1942, and continued to serve as Chairman of the Board until 1967.
In his youth, Samuel competed in cycling and yachting and was an equestrian show jumping champion at competitions in Canada and the United States. His love of horses led to the establishing of Parkwood Stables, a thoroughbred horse racing and breeding farm located a few miles north of Oshawa, Ontario.
After being made an Honorary Colonel of the 11th Ontario Regiment, he was thereafter affectionately called "Colonel Sam". In 1967 Samuel was made a companion of the Order of Canada. He was inducted into Canada?s Sports Hall of Fame in 1963 and the Canadian Horse Racing Hall of Fame in 1977.

Ronald D. Southern
Founder/Leadership, Chairman of the Board, ATCO Ltd.
Calgary, Alberta
Induction Category: Leadership - In 1947 Ron Southern and his father each invested $2,000 in the original Alberta Trailer Hire Co., which later became ATCO Ltd. Mr. Southern completed a Bachelor of Science degree from the University of Alberta in 1953 and began to work full time for the company. Mr. Southern is credited with transforming the company to what it is today ? one of Canada?s premier corporations, with assets of approximately $7.7 billion and employing more than 7,000 persons.
The ATCO Group is engaged in electric power generation, transmission and distribution; natural gas transportation, processing and distribution; technical services and facilities management; call centre and billing services; workforce housing and industrial noise abatement. Mr. Southern remains chairman and majority shareholder of ATCO.
ATCO wasn?t Ronald?s only dream. In 1976 Ronald and his wife, Marg founded the Spruce Meadows, a world-class equestrian facility. Over the years, Spruce Meadows has developed into one of the finest show jumping venues in the world.
Ronald Southern has received many prestigious honours and awards over the years including Canada?s highest civilian honour when he was inducted as a Member of the Order of Canada in 1986 and in 1995 Mr. Southern was inducted into the Canadian Business Hall of Fame.

Robert White
Labour, Canadian Labour Congress
Toronto, Ontario (*) Deceased
Induction Category: Labour - Born in Upper Lands, Northern Ireland in 1935, Robert White immigrated to Canada when he was 13 years old. He began working at the early age of 15 for Hay & Company in Woodstock, Ontario and within a year he had already participated in a strike, his first pro-labour activity. Robert White became fully immersed in the Canadian labour movement as a union organizer and then by 1959, President of Local 636 of the United Auto Workers (U.A.W.). In 1960 Mr. White was appointed as international representative of the U.A.W. and assigned to organize duties in Canada, named administrative assistant to the director of the National Office of the U.A.W. in 1972 and by 1978 Mr. White became the Canadian Director of the U.A.W. In 1984 Robert encouraged the Canadian membership of the U.A.W. to split away from the International union to form a new and separate entity, the Canadian Auto Workers Union. This was an important event in the history of the Canadian labour movement. At the first C.A.W. convention in 1985 Robert was acclaimed as its first leader. Robert became a national figure in Canadian labour and politics during this time.
Robert White served three terms as president of the largest private labour organization in Canada before becoming the president of the Canadian Labour Congress in 1992. Robert represented the interests of 2.2 million Canadian workers and was always a strong advocate of social justice issues and fair trade practices, not only for Canadians but workers around the world.
In addition to Mr. White?s extensive labour history he was also the first Canadian to be President of the Trade Union Advisory Committee (TUAC) of the Organization for Economic Cooperation and Development (OECD), Chair of the Commonwealth Trade Union Council, Chair of the Human and Trade Union Rights Committee of the 126 million-member International Confederation of Free Trade Unions. Mr. White currently serves as President Emeritus of the Canadian Labour Congress
An induction ceremony and dinner will be held Wednesday, October 3, 2007
at the St. Clair Centre for the Arts, Windsor, Ontario.
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ATS files preliminary prospectus for rights offering and annual information form
CAMBRIDGE, ON - ATS Automation Tooling Systems Inc. today announced that it has filed a preliminary short form prospectus in connection with a distribution to its shareholders of rights exercisable to subscribe for common shares of the Company (the "Rights Offering"). The Rights Offering is subject to receipt of all regulatory approvals, including the approval of the Toronto Stock Exchange.
Rights and Subscription Price: Each common shareholder will receive one
right for each common share held on the record date. The record date, the
expiry date, the subscription price, and the number of rights required to
purchase one common share (the "Basic Subscription Privilege") will be
determined prior to the filing of a final short form prospectus. The Company
will make a further announcement with respect to these matters at the time of
the filing of the final short form prospectus.
Additional Subscription Privilege: Holders of rights who fully exercise
their rights under the Basic Subscription Right are entitled to subscribe pro
rata for additional common shares, if available, that were not subscribed for
initially, on or before the expiry date (the "Additional Subscription
Privilege").
Use of Proceeds: The Company anticipates raising gross proceeds of
approximately $110 million pursuant to the Rights Offering. The net proceeds
of the Rights Offering will be used to further expand Photowatt France's
manufacturing capacity, to procure silicon supplies, to advance Photowatt
France's research and development and for general corporate purposes at
Photowatt France, as further described in the preliminary short form
prospectus and the Company's news release dated June 20, 2007.
Dealer Managers: BMO Capital Markets and UBS Securities Canada Inc. are
dealer managers for the Rights Offering.
Standby Purchasers: The Company has entered into a standby purchase
agreement with three large ATS shareholders, Goldman Sachs Canada Inc.,
Goodwood Inc. and Mason Capital Management, LLC. These standby purchasers have
agreed to purchase all common shares that are not otherwise su | |