Canada report

By JIM FOX

© St. Petersburg Times, published February 18, 2001

Nortel profit warning sends investors fleeing

Investors bailed out of Canadian fiber-optics giant Nortel Networks, rocking the stock market, after the company issued a profit and revenue warning.

Nortel expects to cut as many as 10,000 jobs this year because of the sudden downturn in the U.S. economy. About 6,000 of those jobs have been eliminated, mostly through attrition and early retirements, from a work force of 85,000 people.

The surprise announcement resulted in shares in Canada's biggest high-tech company plunging by $15 to $31 on the Toronto Stock Exchange.

Chief executive John Roth said Nortel, the world's biggest supplier of optical equipment used to build the phone and data networks of the Internet, would lose money in the first quarter and revenues would be squeezed by U.S. economic conditions.

After making big profits in recent years, Nortel forecasts revenue and profit growth from operations at 15 percent and 10 percent respectively this year -- about half of earlier forecasts.

First-quarter revenues are predicted at $6.3-billion (U.S.) -- nearly $2-billion below earlier estimates -- and the company will post a loss per share from operations of 4 cents U.S.

Extradition hurdle upheld

The Supreme Court of Canada has ruled that almost no one facing the death penalty should be extradited from Canada.

In a 9-0 ruling, the judges upheld the guarantees of fundamental justice and the right to life, liberty and security under the Charter of Rights and Freedoms.

Some observers said the judgment suggests an end to any chance of reinstating the death penalty, which was abolished in Canada in 1976.

The ruling centers on Vancouver men Atif Rafay and Glen Sebastian Burns, who are wanted in the slayings of Rafay's father, mother and sister in their Bellevue, Wash., home in 1994.

Justice Minister Anne McLellan said she will seek assurances from Washington state prosecutors before extradition is allowed that the pair won't be executed if convicted.

In brief

Bernard Landry, Quebec's premier-in-waiting, has said the province should again have an official premier's residence. Lucien Bouchard, the retiring premier whom Landry likely will replace within weeks, never used the residence and it was sold. "I think it's quite normal (to have an official residence); Quebec is a national capital," Landry said in 1998.

Author Mordecai Richler, Supreme Court Judge Antonio Lamer and sex educator Sue Johanson are among 98 people appointed to the Order of Canada. The Order was established in 1967 to recognize outstanding achievement and service in various fields of endeavor.

Facts and figures

Stock exchanges and the Canadian dollar took a beating last week.

The Nortel selloff pulled the Toronto Stock Exchange 300 Index down 574 points Friday to 8,393 points while the Canadian Venture Exchange index closed at 3,221 points.

The Canadian dollar dropped to 64.97 cents U.S. on expectations of lower interest rates while the U.S dollar returned $1.5391 in Canadian funds before bank exchange fees.

The key Bank of Canada rate is unchanged at 5.75 percent while the prime lending rate is 7.25 percent.

Lotto 6-49: (Wednesday) 12, 13, 14, 32, 41, and 43; bonus 6. (Feb. 10) 9, 11, 36, 38, 46 and 47; bonus 12.

Regional briefs

Albertans will vote March 12 to elect the provincial government; Premier Ralph Klein is seeking re-election for his Conservative Party. Opposition New Democrat Leader Raj Pannu said he would scrap corporate tax cuts and increase social spending. Klein is planning a 10-percent flat income tax and cuts in corporate income taxes to 8 percent from 15.5 percent.

Two Swedish women and a ski guide were killed in an avalanche in the Lizard Range of the Rocky Mountains near Fernie, British Columbia. Anna Alberts, 26, and her sister Malin, 24, of Stockholm, and local guide Paul Norrie were buried by heavy snow on the back-country mountain. Nine others were rescued and removed by helicopter after spending the night trapped in the area.

Newfoundland was again lashed by snow, ice pellets, rain and hurricane-force winds as another blizzard blew into the island province. St. John's has had its harshest winter in 60 years with about 12 feet of snow and more expected over the weekend. On the west coast, Victoria and Vancouver, which are usually rainy at this time of year, had a taste of winter with snow on Friday.

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