TransCanada Corp says more layoffs on the way after cutting 10% of its staff in Q4

CALGARY C TransCanada Corp. said Thursday more layoffs are expected because the energy sector grapples with plunging oil prices, after confirming it let go 10 per cent of workforce in the fourth quarter.

The Calgary-based pipeline company let go staff in November, but did not provide numbers until Thursday’s earnings call to discuss fourth-quarter results. Chief financial officer Don Marchand said the layoffs cut more heavily into management positions, including vice-president and director positions.

“I wouldn’t say we’re done at this point,” Marchand said, adding the company is constantly on the look for more duplication across its business.

Financial disclosure documents filed through the company Thursday reveal that TransCanada employs 500 fewer people now than it did last year. The company employed 5,512 employees at the end of December, compared with 6,059 employees at the end of 2014.

TransCanada posted a $2.5 billion net reduction in the final quarter, thanks mainly to some $2.9-billion impairment charge on its rejected Keystone XL pipeline.

“We were extremely disappointed through the arbitrary and unjust denial of the Keystone XL pipeline,” TransCanada president and CEO Russ Girling said on the company’s earnings call.

U.S. The president formally rejected his company’s application for any permit to build the pipeline project between Alberta and also the U.S. Gulf Coast within the fourth quarter.

In response, TransCanada initiated a $15 billion claim underneath the North American Free Trade Agreement and launched a case over the legality from the rejection in Texas.

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“TransCanada will look for a way to create that project happen at some stage in the near future,” Girling said, adding that oil producers still need the line’s capacity.

Despite the large impairment charge, the organization was able to increase its quarterly dividend by 18 cents, or nine per cent, to 56.5 cents per share.

Girling said the organization is put to improve its dividend by eight to 10 % every year until 2020.
 
TransCanada also confirmed it’s on pace to create $13-billion price of projects into service by 2018, and it is working on $45 billion in additional, larger scale projects within the longer term.

Girling also addressed the Canadian government’s decision to judge the company’s Energy East project’s contribution towards the country’s total greenhouse gas emissions and said he believes the work will still be operating by 2020.

Among another large-scale projects, TransCanada said hello is continuing to operate on its Coastal Gas Link and Prince Rupert Gas Transmission Line projects, which would deliver natural gas to proposed liquefied gas facilities in B.C.

To date, the organization has spent $300 million and $400 million pushing both of those projects through Canada’s regulatory process.

In a study note, FirstEnergy Capital Corp. analyst Steven Paget said TransCanada’s outcome was consistent with expectations, and posted adjusted earnings per share of 64 cents, in contrast to consensus expectations of 61 cents.

Girling said the company is scheming to make the business’s earnings and financial performance even more predictable.

gmorgan@nationalpost.com

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