The following is the text of Canada’s financial statistics report for the fourth quarter released by Statistics Canada.
Canadian corporations reported $72.5 billion in operating profits in the fourth quarter, up 1.4% from the previous quarter. This followed a 3.9% increase in the third quarter.
Operating profits increased in 13 of 22 industries. Insurance carriers and related activities led the overall increase, up 29.7% to $2.4 billion.
The construction industry rose 12.7% to $4.0 billion while information and cultural industries increased 7.4% to $5.9 billion.
In the non-financial sector, fourth quarter operating profits rose 2.1% to $53.1 billion. This followed a 3.4% increase the previous quarter.
In the financial sector, operating profits decreased 0.4% to $19.4 billion, following a 5.3% rise in the third quarter.
Operating profits for Canadian corporations stood at $72.5 billion in the fourth quarter, 1.2% lower than the fourth quarter of 2011. Profits fell 7.2% in the non-financial sector, while they rose 19.7% in the financial sector.
Operating profit growth in manufacturing was unchanged in the fourth quarter following strong gains in the third quarter. Profits stood at $12.7 billion in the fourth quarter.
Increases were reported in 10 of 13 manufacturing industries, led by motor vehicle and parts manufacturers’, which saw operating profits increase 33.2% to $1.2 billion on strong year-end sales. This followed a 12.1% decline in the third quarter.
Profits for chemical, plastics and rubber products manufacturers rebounded, rising 14.4% to $2.0 billion, following a 17.0% decline in the third quarter.
Primary metal manufacturing profits increased 44.3% to $620 million.
The increases in the manufacturing sector were offset by a decline in operating profits for petroleum and coal products manufacturers, down 26.5% to $3.2 billion in the fourth quarter.
Profits in construction rose 12.7% to $4.0 billion.
Profits for information and cultural industries rose 7.4% to $5.9 billion. The increase was concentrated in the telecommunications industry, where profits rose 10.1% to $4.4 billion.
Profits in transportation and warehousing rose 10.9% to $3.0 billion.
Oil and gas extraction and support activities profits fell 22.7% to $1.1 billion, while mining profits fell 18.0% to $1.7 billion.
Retailers’ profits increased 6.1% to $4.1 billion, with motor vehicle and parts dealers representing just under half of the fourth quarter increase.
Fourth quarter operating profits fell 0.4% to $19.4 billion in the financial sector. A $634 million decline by depository credit intermediaries was largely offset by a $540 million increase by insurance carriers.
Note to readers
Quarterly financial statistics are compiled using financial information provided by enterprises that derive this data from their financial statements. Since January 1, 2011, Canadian publicly accountable enterprises have been required to replace Canadian Generally Accepted Accounting Principles (CGAAP) with International Financial Reporting Standards (IFRS) when preparing their financial statements for fiscal years starting on or after January 1, 2011. Canadian private enterprises are required to replace CGAAP by Accounting Standards for Private Enterprises or IFRS. The adoption of new accounting standards by some enterprises since the beginning of 2011 may affect comparability with prior periods.
Quarterly profit numbers referred to in this release are seasonally adjusted and are in current dollars. The quarterly financial data for the first, second and third quarters of 2012 have been revised. For more information on seasonal adjustment, see Seasonal adjustment and identifying economic trends (http://www5.statcan.gc.ca/bsolc/olc-cel/colc-cel?catno=11-010-X201000311141&lang=eng) .
Quarterly financial statistics for enterprises are based upon a sample survey and represent the activities of all corporations in Canada, except those that are government controlled or not-for-profit. An enterprise can be a single corporation or a family of corporations under common ownership and/or control, for which consolidated financial statements are produced.
Profits referred to in this analysis are operating profits earned from normal business activities. For non-financial industries, operating profits exclude interest and dividend revenue and capital gains/losses whereas, for financial industries, these are included, along with interest paid on deposits.
Operating profits differ from net profits, which represent the after-tax profits earned by corporations.