Magna Earns $456 Million Profit
CBJ — Despite a lot of media attention recently surrounding the lawsuits between Magna International founder Frank Stronach and his daughter Belinda Stronach, the company has reported a $456 million profit for its fourth quarter.
However, Magna CEO Don Walker is concerned about U.S. tariffs on Canadian steel and aluminum. While the $456 million is a nice profit, it’s also down significantly from last year’s profit of $559 million, when U.S. tariffs largely did not impact on the bottom line, having only been implemented last June. The U.S. imposed harsh 25% tariffs on steel and 10% tariffs on aluminum.
“It’s mainly hurting our U.S. plants right now, because it’s very difficult to get offsets for that,” says Walker.
Canada had the option of either accepting or rejecting a negotiated deal between the U.S. and Mexico in a pact that would replace NAFTA. Canada ultimately accepted and the new trilateral trade deal is known as the USMCA agreement. The final ratification must still be signed. The USMCA stipulates that 40% of an automobile ‘s content be made where auto workers earn at least $16 an hour and sets a higher threshold for North American content.
Magna, which keeps its books in U.S. dollars, said it will now pay a quarterly dividend of 36.5 cents per share, up from 33 cents per share.