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MORNING NEWS CALL Edition Thursday, May 3, 2018

TOP NEWS • Bombardier sells assembly site in major makeover Bombardier has agreed to sell its Toronto aircraft assembly site to a fund as it strives to raise extra cash under a five-year recovery plan. • Trump praises China's Xi as U.S. team arrives for trade talks U.S. President Donald Trump praised his relationship with Chinese President Xi Jinping as a U.S. delegation arrived in Beijing for talks on tariffs, with state media saying China will stand up to U.S. bullying. • Canadian Natural Resources profit beats on higher output Canadian Natural Resources Ltd, Canada's largest independent petroleum producer, reported a better-than-expected quarterly profit, helped by higher oil sands production. • Canada's BCE misses on profit due to higher expenses Canadian telecommunications company BCE's first-quarter profit narrowly missed analysts' estimates as a near 13 percent jump in operating expenses offset growth in its wireless postpaid business. • Crescent Point reports quarterly loss on Canada crude discounts Oil and gas producer Crescent Point Energy reported a first-quarter loss as it sold Canadian crude at a bigger discount.

BEFORE THE BELL Stock futures pointed to a higher opening for Canada's main stock index as gold prices rose, while investors focused on a host of earnings from companies including Bombardier. U.S. stock futures were little changed as worries over global trade tensions weighed. The negative mood also hurt Asian equities. European shares fell, dragged by a rebound in the euro and a series of dis- appointing earning reports. The U.S. dollar was steady against a basket of currencies. Swelling U.S. crude inventories and record weekly U.S. production pushed oil prices lower.

STOCKS TO WATCH

Results • BCE Inc (BCE). The telecom company reported a 3 percent rise in quarterly profit as more subscribers signed up for its wireless services. BCE said net income rose to C$661 million, or 73 Canadian cents per share, in the first quarter, from C$642 million, or 73 Canadian cents per share, a year earlier. The company said operating revenue rose nearly 5 percent to C$5.59 billion. • Bombardier Inc (BBDb).The plane and train maker reported a 16-percent rise in its favoured measure of profit and said it had agreed to sell its Toronto aircraft assembly site to a pension fund as part of its five-year recovery plan. The company said it made $265 million before interest, taxation, depreciation and amortization in the first quarter, helped by higher orders for its rail-focussed transportation unit and an improving market for business aircraft. The company, which is in the middle of the turnaround plan after considering bankruptcy in 2015, said earlier this year that it was weighing a sale of the site. Adjusted net income attributable to com- pany shareholders fell to $22 million in the first quarter ended March 31 from $28 million a year earlier. Overall revenue rose nearly 12 percent, helped by 21 percent rise in revenue for the transportation unit. • Canadian Natural Resources Ltd (CNQ). The petroleum producer, reported a better-than-expected quarterly profit, helped by high- er oil sands production. The Calgary-based company's net income rose to C$583 million, or 47 Canadian cents per share, in the quar- ter ended March 31, from C$245 million, or 22 Canadian cents, a year earlier. Excluding items, the company reported a profit of 71 Canadian cents per share, while analysts on average expected a profit of 66 Canadian cents. • Crescent Point Energy Corp (CPG). The oil and gas producer reported a first-quarter loss on wider-than-normal discount of Cana- dian crude to U.S. light crude. The company reported a net loss of C$90.7 million, or 17 Canadian cents per share, in the first quarter ended March 31, compared to a profit of C$119.4 million, or 22 Canadian cents per share, a year earlier. • Financial Corp (MFC). The insurer reported an 18.3 percent jump in first-quarter earnings on Wednesday as it gained from robust demand in Asia. Manulife said its total core earnings rose to C$1.3 billion, or 64 Canadian cents per share, in the first MORNING NEWS CALL - CANADIAN EDITION May 3, 2018 quarter, from C$1.1 billion, or 53 Canadian cents, a year earlier. Core earnings from the company's Asia division rose 19.6 pct to C$427 million in the first quarter.

In Other News • Valeant Pharmaceuticals International Inc (VRX). A former Valeant Pharmaceuticals executive and the former head of mail order pharmacy Philidor Rx Services will face trial Thursday on charges they orchestrated a multimillion-dollar kickback scheme, more than two years after Valeant drew scrutiny for its business practices. Gary Tanner, formerly a senior director at Valeant, and Andrew Dav- enport, formerly chief executive officer of Philidor, have pleaded not guilty to charges including wire fraud and money laundering con- spiracy.

INSIGHT In U.S. Gulf, robots, drones take on dangerous offshore oil work At BP's massive Thunder Horse oil platform in the U.S. Gulf of Mexico, a dog-sized robot called Maggie uses magnetic tracks to creep along pipes connecting the giant oil facility to the sea floor. Before MaggHD, dubbed "Maggie" by BP, the dangerous inspection job was reserved for highly paid specialist technicians who did their jobs while rappelling along the platform. The energy industry has turned to robots and drones to cut costs and improve safety in some of the world's tougher working environments.

ANALYSTS' RECOMMENDATION • CGI Group Inc (GIBa). CIBC raises target price to C$83 from C$80, after the company reported better-than-expected second- quarter results, citing that margins are set to improve with industry tailwinds driving organic growth. • Goeasy Ltd (GSY). Desjardins raises price target to C$44 from C$43, believing the company’s management is executing on targets and foreseeing double-digit dividend growth in the next few years.

ECONOMIC EVENTS (All timings in U.S. Eastern Time) 0830 Trade balance for Mar: Expected -C$2.24 bln; Prior -C$ 2.69 bln 0830 Export for Mar: Prior 45.94 bln 0830 Import for Mar: Prior 48.63 bln

COMPANIES REPORTING RESULTS May 3: BCE Inc (BCE). Expected Q1 earnings of 82 Canadian cents per share Bombardier Inc (BBDb). Expected Q1 earnings of breakeven per share Canadian Natural Resources Ltd (CNQ). Expected Q1 earnings of 66 Canadian cents per share Crescent Point Energy Corp (CPG). Expected Q1 earnings of 7 Canadian cents per share Enerplus Corp (ERF). Expected Q1 earnings of 27 Canadian cents per share Fairfax Financial Holdings Ltd (FFH). Expected Q1 earnings of $9.44 per share Great-West Lifeco Inc (GWO). Expected Q1 earnings of 74 Canadian cents per share Mercer International Inc (MERC). Expected Q1 earnings of 67 cents per share Mitel Networks Corp (MITL). Expected Q1 earnings of 25 cents per share Norbord Inc (OSB). Expected Q1 earnings of $1.22 per share Corp (PPL). Expected Q1 earnings of 65 Canadian cents per share Seven Generations Energy Ltd (VII). Expected Q1 earnings of 36 Canadian cents per share Snc-Lavalin Group Inc (SNC). Expected Q1 earnings of 55 Canadian cents per share

May 4: Dorel Industries Inc (DIIb). Expected Q1 earnings of 62 cents per share IGM Financial Inc (IGM). Expected Q1 earnings of 77 Canadian cents per share

2 MORNING NEWS CALL - CANADIAN EDITION May 3, 2018

CORPORATE EVENTS (All timings in U.S. Eastern Time) 0800 BCE Inc (BCE). Q1 earnings conference call 0800 Bombardier Inc (BBDb). Q1 earnings conference call 0800 Manulife Financial Corp (MFC). Q1 earnings conference call 0830 Kinaxis Inc (KXS). Q1 earnings conference call 0830 Parkland Fuel Corp (PKI). Q1 earnings conference call 0830 Waste Connections Inc (WCN). Q1 earnings conference call 0830 Yamana Gold Inc (YRI). Q1 earnings conference call 0900 Fortis Inc (FTS). Annual Shareholders Meeting 0930 BCE Inc (BCE). Annual Shareholders Meeting 0930 Enerplus Corp (ERF). Q1 earnings conference call 1000 Canadian Natural Resources Ltd (CNQ). Q1 earnings conference call 1000 Cott Corp (BCB). Q1 earnings conference call 1000 Ltd (FM). Annual Shareholders Meeting 1000 Activewear Inc (GIL). Annual Shareholders Meeting 1000 Ltd (NMI). Q1 earnings conference call 1030 Bombardier Inc (BBDb). Annual Shareholders Meeting 1100 Great-West Lifeco Inc (GWO). Annual Shareholders Meeting 1100 Ltd (L). Annual Shareholders Meeting 1100 Manulife Financial Corp (MFC). Annual Shareholders Meeting 1100 Pason Systems Inc (PSI). Q1 earnings conference call 1100 Seven Generations Energy Ltd (VII). Q1 earnings conference call 1100 Snc-Lavalin Group Inc (SNC). Annual Shareholders Meeting 1100 Yamana Gold Inc (YRI). Annual Shareholders Meeting 1200 Crescent Point Energy Corp (CPG). Q1 earnings conference call 1330 Stella-Jones Inc (SJ). Q1 earnings conference call 1400 Norbord Inc (OSB). Q1 earnings conference call 1500 Snc-Lavalin Group Inc (SNC). Q1 earnings conference call 1500 Western Forest Products Inc (WEF). Q1 earnings conference call 1530 Great-West Lifeco Inc (GWO). Q1 earnings conference call 1600 Seven Generations Energy Ltd (VII). Annual Shareholders Meeting 1700 Altus Group Ltd (AIF). Q1 earnings conference call 1700 ARC Resources Ltd (ARX). Annual Shareholders Meeting 1700 Baytex Energy Corp (BTE). Annual Shareholders Meeting

EXDIVIDENDS There are no major exdividends for the day.

(All analysts' estimates are according to Thomson Reuters I/B/E/S)

3 MORNING NEWS CALL - CANADIAN EDITION May 3, 2018

PICTURE OF THE DAY

Detained and handcuffed Reuters journalist Kyaw Soe Oo carries his daughter Moe Thin Wai Zin while arriving for a court hearing in Yangon, Myanmar May 2. REUTERS/Ann Wang

(Compiled by Yoganand KN and Erum Khaled in Bengaluru) NEWS ACCESS MADE EASY Reuters Top News page displays a range of market and sector-specific subjects To subscribe for The Morning Newscall newsletter click here including: US, Europe and Asian companies, fixed income, credit, the global To un-subscribe for this newsletter click here economy, emerging markets, corporate finance and industry sectors. To access Reuters Top News For questions or comments about this report, contact: -- Thomson ONE: Click News tab, Select Front Page from top right, Click Top [email protected] News.

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