Corporate profits rose in the third quarter led by the financial sector, according to new data from Statistics Canada.
The national statistical agency reported that pre-tax net income for Canadian corporations rose by 4.7% in the third quarter, growing by $7.2 billion to $160.3 billion.
The financial sector led the way, with profits rising by 6.7% in the quarter, while profits in the non-financial sector rose 4.0%.
According to StatsCan, the financial sector saw a $2.6-billion increase in pre-tax net income, led by a $2.9-billion gain in the securities/investment sector.
Profits were also up by $1.2 billion in the life and health insurance business, it said, with the gain driven by “lower expenses arising from actuarial liabilities.”
Some of these increases were offset by declining profits in the banking business, which saw profits drop thanks to “a rise in labour costs and [higher provisions] for credit losses” in the third quarter, StatsCan reported.
For the non-financial industries, profits rose in 24 out of 39 categories, StatsCan reported, with higher oil prices powering much of these gains.
For instance, profits in the petroleum and coal manufacturing sector rose by $1.5 billion to $4.9 billion in the quarter.
“This increase was led by the prices of refined petroleum products,” StatsCan said.
Profits in the oil and gas extraction industry rose 15.3% in the quarter, up $1.2 billion, with higher oil prices in the wake of OPEC+ production cuts driving the increase.
The auto manufacturing and transportation sectors also saw strong earnings gains, StatsCan reported.
Some of these net income improvements were offset by declining profits in the metal and machinery manufacturing industry, it noted.