Here are five things you need to know this morning:
Cue the succession music: Canadian retailer Groupe Dynamite went public in an IPO last month, but the idea for it was formed back in 2018 when the company’s CEO realized he didn’t have an appropriate succession plan in place. That’s according to the man himself, Andrew Lutfy, who told Bloomberg in an interview yesterday that he realized more than half a decade ago that he had no obvious internal candidate to replace him, nor did he have any children to pass the business on to, so he set about restructuring the retailer to thrive for the long term. He started at the company back in 1982 as a stockroom clerk at the first Garage store in Canada. If you can believe it, his then-girlfriend’s family owned the business at the time and gave him a 25 per cent sweat-equity stake in it. In 2003, he bought them out. The IPO was the biggest on the TSX this year, and the shares are currently trading just below the $21 level they went public at.
Interac moves to flat fees: As first reported by The Logic yesterday, Interac is planning to move to a flat-fee model for e-transfer fees starting next year. The company told a parliamentary committee yesterday that it plans to move away from its current system, where it charges between six and 14 cents per transaction, depending on volume. For one 12-month period ending in 2022, Interac processed $388 billion worth of e-transfers, The Logic reported. The new system will charge the same amount regardless of volume. The issue of payment fees has come under increasing scrutiny in recent years, culminating in a deal the federal government struck with retailers and credit card companies to bring down so-called interchange fees.
Bad news if you like bourbon and Harleys: Prime Minister Justin Trudeau says Canada will respond with tariffs of its own on U.S. goods if Donald Trump follows through on his threat to add a 25 per cent one to Canadian imports. He told a Halifax business audience yesterday that the country has a few weapons at its disposal in the current trade cold war, none of which he particularly wants to use. “Let’s not kid ourselves in any way shape or form: 25 per cent tariffs on everything… would be devastating for the Canadian economy,” Trudeau said. The last time Trump put tariffs on Canadian steel and aluminum, Canada responded with targeted tariffs on things like Harley Davidsons and Kentucky Bourbon, to send a message. Trump doesn’t appear to be getting whatever message Trudeau is trying to send, however, saying in a post on his social media network Truth Social that he enjoyed having dinner the other night with “Governor Justin Trudeau of the Great State of Canada.”
GameStop earnings after the bell: One stock to keep an eye on today will be GameStop, where the mother of all meme stocks will report earnings after the bell. Analysts expect the company to post revenue of US$887 million during the quarter, down from $1.07 billion this time last year but an improvement on the previous two quarters. Despite the revenue, the company is expected to report a loss of three cents per share. The shares have gained more than 60 per cent this year but are still well off their 2021 highs.
Not mad, just disappointed: Canada Post management says it is “extremely disappointed” with the latest offer from its striking union. Management says the latest offer seems designed to widen the gap, not narrow it. The Canadian Union of Postal Workers has been on strike for the past three weeks, a critical time of a year for package shipments for small businesses. CUPW says it has reduced its wage demand for an increase of 19 per cent over four years.