Monthly review November 2019

Basic materials Sector

Cascades is elected for the 10th consecutive year the most responsible company in Quebec according to the Barometer of Responsible Consumption

A leader in the manufacture and recovery of paper products, Cascades (TSX: CAS) ranked first among organizations deemed to be the most responsible by Quebecers, followed by Desjardins, Attitude and Tesla. It is also the only company that has consistently been on this list for the past 10 years.

ESG UQAM’s Observatory of Responsible Consumption (OCR) publishes annually the Responsible Consumption Barometer in Quebec with the objective of assessing current trends in responsible practices. For 2019, criteria such as consumer protection, ethical and responsible practices, respect for the environment and involvement in social causes made it possible to rank Cascades on the top of the list. Indeed, the Canadian company has been committed for several years to be a leader in sustainable development. With its wide range of eco-friendly products and its recovery system working in the management, collection and processing of materials, Cascades now uses raw materials made up of more than 78% of recycled content. While Cascades clearly surpasses its Canadian and American competitors in terms of environmental practices, a threat is beginning to be felt as Asian competitors are starting to introduce low-cost eco-friendly paper products. As China and Indonesia are developing the same kinds of products as the Canadian paper manufacturer for only half the price, Cascades will have to optimize its operating margin and continue to focus on the quality of its services in order to maintain its competitive edge on the American market.

 Industrial Sector

Cascades Inc. (TSX : CAS), a leader in eco-friendly recycling, packaging and hygiene solutions, announced on November 26, 2019 that it has completed its previously announced private offering (November 13, 2019) of :

  • US$350 million aggregate principal amount of 5.125% senior notes due 2026,
  • US$300 million aggregate principal amount of 5.375% senior notes due 2028,
  • CDN$175 million aggregate principal amount of 5.125% senior notes due 2025. 

The net proceeds from the senior notes offering will be used by Cascades Inc to : 

–  redeem all senior notes already issued for capital of : 

  • US$400 million aggregate principal amount of 5.50% senior notes due 2022, 
  • CDN$250 million aggregate principal amount of 5.50% senior notes due 2021.

– repay certain amounts outstanding under its revolving credit facility. 

The redemption date of the 2021 senior notes is December 13, 2019, and the redemption price is 101.375% of the principal amount, plus accrued and unpaid interest to, but not including, December 13, 2019. The redemption date of the 2022 senior notes is December 26, 2019, and the redemption price is 101.375% of the principal amount, plus accrued and unpaid interest to, but not including, December 26, 2019.

Note : Senior notes are debt securities (bonds) that take precedence over other types of debt, in that senior note-holders are the first to be paid if any assets are left over after a company’s liquidation, following bankruptcy proceedings. Senior notes pay lower coupon rates of interest than junior unsecured bonds, because they boast a higher level of security and carry a reduced risk of default.

Consumer Cyclical Sector

La Caisse de dépôt et placement du Québec (CDPQ) invests in Australia

La Caisse de dépôt et placement du Québec (CDPQ) announced November 27, 2019 an investment of $ 167 million AUS (CAN $ 150 million) in an autonomous subway project in Sydney, Australia. This investment is intended to acquire 24.9% of the contract to participate in the construction of the metro.

 This public-private partnership project aims to build 66 kilometers of autonomous railways by 2024. The CDPQ said in a statement that it is “the largest public transit project in Australia”.

Energy Sector

 Innergex maintain a steady pace of growth

Following the inauguration of the largest solar park in Texas, Phoebe at $ 525 million, Innergex is embarking on major new projects. Innergex announced the signing of a long-term power purchase agreement with the launch of a Hillcrest solar project in Ohio, United States. The exercise was signed with a US company in Brown County, Ohio. Expected sales to the PPA are expected to be overwhelmed when the solar park is commissioned in 2020.

CEO of the firm Michel Lettelier has unveiled $ 1 billion of assets under management.

Analyst Rupert obtained a gain from the National Bank at the National Bank. It still has a lot of growth to do with third quarter results with EBITDA up 28%.

Technology Sector

CGI plans to double its workforce in 5 to 7 years

After a positive fourth quarter boosting its net income by 10.5%, the Canadian firm recently announced plans to continue its expansion by doubling its workforce in a relatively short term.

This growth is particularly directed to North America and Europe where opportunities are numerous. CGI had a total backlog of $ 22.61 billion at the end of September. However, this strategy also results in the closure of its service center in Brazil because the company wants to abandon Latin America.

 Communication Services

Growing client dissatisfaction

The Telecommunications Complaints Commission (CCTS) reported in its annual report that the number of complaints against the companies in the sector increased from 14,272 in 2017 to 19,287 for the same period in 2018 .

The report notes that the number of complaints for Bell (BCE) remains the highest, as in the previous year. On the other hand, Telus (T) saw its complaints increase by nearly 71%, a considerable change that forces the company to question the quality of its service.

These impressive numbers could scare an investor in the sector. It is also important to note that the supply of new technological services can cause a lot of problems initially. It will be interesting to see if this sector will be able to transition to new technologies while keeping the customer satisfied.

Consumer Defensive Sector

Couche Tard wants to acquire Caltex for $ 7.8 billion CAN

Couche-Tard offered to acquire 100% of Caltex on November 18, 2019 for 7,8 Billion CAN$ ( 34,50 $AUS per share). This action will enable Couche-Tard to control more than 2,000 convenience stores and gas stations in Australia.This strategic choice could enhance the value of Caltex to over 9 billion CAN $ and benefit both parties. However, Couche-Tard’s offer did not satisfy Caltex’s shareholders  expectations who believe that this offer is an undervaluation of Caltex’s shares. This is the second time that Couche-Tard offers to buy 100% of the shares of Caltex and fail to convince the shareholders

Utilities Sector 

Alberta to maintain oil quotas at 3.81M barrels a day for January

The Alberta government has announced that its oil production quotas will remain unchanged in January to adapt to the consequences of the delay in oil transportation that can be attributed to the strike of the Canadian National Railway (CN) and the temporary closure of the Keystone Pipeline following a spill in North Dakota.

The Canadian Department of Energy told producers that the production cap for January would remain at 3.81M barrels a day after several months of quota cuts.

The outgoing NDP government has introduced production caps since January 2019 to better align supply levels with pipeline capacity and reduce Alberta’s price rebates, which are larger than usual because of the high levels of stocks.

In the aftermath of these events, the United Conservative government announced that oil production from new conventional wells would not be constrained to reductions and that producers adding crude oil transportation capacity by rail could produce more. Quotas now only concern the 16 largest producers.


Observatoire de la Consommation Responsable. (29 novembre 2019). 10 ans – Baromètre de la Consommation Responsable. [En ligne]. Disponible :

The Globe and Mail. (22 avril 2013). Is ‘green’ enough of a quality to give Cascades the edge ? [En ligne]. Disponible :

Les Affaires. (28 novembre 2019). La Caisse investit dans un projet de métro sans conducteur en Australie. [En ligne]. Disponible:

Cascades Inc. 26 Novembre 2019. CASCADES ANNONCE LA RÉALISATION DE SON PLACEMENT DE BILLETS. [En ligne]. Disponible à :

Newswire, «Innergex annonce la signature d’un contrat d’achat d’électricité à long terme pour le projet solaire Hillcrest en Ohio, États-Unis,» 28 Novembre 2019. [En ligne]. Available:

P. Couture, «Innergex: un milliard $ de projets dans les plans,» 4 Novembre 2019. [En ligne]. Available:

S. Rolland, «À surveiller: Apple, WSP et Innergex,» 13 Novembre 2019. [En ligne]. Available:

Newswire, «Innergex annonce la mise en service complète de Phoebe, le plus grand parc solaire en exploitation au Texas,» 19 November 2019. [En ligne]. Available:

La Presse. (2019). Télécom: hausse des plaintes au Canada. [En ligne] Disponible au: [Accédé le 28 Nov. 2019]

Le devoir. (7 novembre 2019). CGI veut doubler sa taille. Tiré de :

Journal de Quebec. (30 novembre 2019). Couche-Tard: l’empire québécois du dépanneur qui n’en finit plus de grossir. Tiré de :

Les Affaires. (2019, novembre 27). L’Alberta maintient ses quotas sur le pétrole en janvier. Disponible sur:

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