While some of struggled, others have prospered
Many predicted the damage to the Montreal-area economy would be temporary. It’s now clear some businesses may never be the same. The effects of the coronavirus pandemic have rippled through the economy. Unemployment has soared and many businesses have str
We’re extremely busy. The only time I can remember things being so hectic was in the spring of 2017, with the flooding in Pierrefonds.
Karine Melançon, managing director of the Montreal office, Paul Davis Restoration Inc.
JUST FOR LAUGHS
With no crowds permitted to gather, the city’s premier comedy festival had to reinvent itself.
Just for Laughs laid off most of its employees this spring as 60 per cent of revenue evaporated overnight. Just for Laughs will hold its event Sept. 29 to Oct. 11, two months later than usual. However, it’s still not clear whether anyone will be permitted to attend live comedy shows, or whether the venues for the festivals will be able to adapt to new distancing rules.
Group CEO Charles Décarie said much of the event will be moved online. The company had what Décarie called a successful trial run with FSTVL HA-HAHA, a four-day digital comedy festival in late May that featured more than 60 francophone artists. It drew about 24,000 paying customers and offered organizers useful lessons as they prepare for the main event.
CIRQUE DU SOLEIL
Already debt-ridden when the pandemic hit, Cirque du Soleil closed all 44 of its shows and laid off 95 per cent of its staff, which adds up to 4,679 employees around the world.
In May, the Montreal-based company’s three principal owners — American private equity investment firm TPG Capital, Chinese investment company Fosun and the Caisse de dépôt et placement du Québec — injected $50 million into the firm. The Quebec government then gave the company a $200-million loan in hopes of keeping the company based in Montreal.
Since TPG Capital bought the firm in 2015, the Cirque spent US$550 million to grow the company and had been expecting a big payout. However, the company had been experiencing problems in recent months. It shuttered its latest Las Vegas show, R.U.N., a box-office bomb that cost the company US$60 million.
Although most of its stores have reopened, all is not well with iconic Montreal fashion brand.
The nearly 100-year-old company filed for bankruptcy protection in May, after having closed all of its 576 stores due to the coronavirus pandemic.
The company employed 6,800 people worldwide under brands that include Addition Elle, RW & Co. and Thyme Maternity. It temporarily laid off 90 per cent of its store employees and 30 per cent of the workers in its headquarters and cut the wages of others.
In June, the company announced it would terminate its Thyme Maternity and Addition Elle brands and permanently cut 1,400 jobs as it restructures.
“All of the efforts we put forth to turn these (two) brands around were derailed by the
COVID -19 pandemic and, unfortunately, we can no longer afford the required resources to bring them back to profitability,” Stephen Reitman, CEO of Reitmans, said in a statement.
When the pandemic started, the nation’s largest air carrier went into hibernation mode. It slashed capacity by up to 90 per cent, furloughed more than half of its 38,000 workers and stepped up a cost-reduction plan that’s estimated to yield more than $1 billion in annual savings. It also raised $1.6 billion through a stock and convertible debt sale.
However, in June CFO Mike Rousseau said the company will likely need new financing to stay afloat during what are sure to be difficult times ahead. The company believes it will take about three years to fully recover from the worldwide decline in air travel. One positive trend: Leisure customers have resumed buying tickets for travel within Canada.
After a difficult fall, outdoor retailer SAIL was counting on a strong winter and spring to recoup its sales. The coronavirus proved too great a challenge for the 40-year-old Laval-based business and it filed for bankruptcy protection in June.
The company will be closing all its Sportium-brand stores in Quebec City, St-hubert, Laval and Kirkland and its Ontario stores in Vaughan and Etobicoke. The company will lay off about 500 workers.
It will focus on 12 remaining Sail locations — eight in Quebec and four in Ontario — as well as its e-commerce business.
Despite the bad news, Norman Décarie, the owner and director general of the company, said he’s optimistic about the future, as travel restrictions will likely increase demand for many outdoor leisure items that the company sells, such as fishing gear, camping and hiking equipment.
Jason Magder
Montreal-based Genie is known for fulfilling unorthodox requests.
The company, which was founded in 2017 and bills itself as a personal assistant on demand, has written a speech for a best man at a wedding, hired and arranged musicians to serenade a lover, and once delivered 200 red Skittles in a fanny pack to a journalist covering the Osheaga music festival.
While the pandemic resulted in an overall increase in demand, a partnership starting June 15 with Centre-ville Montréal really brought the company into the spotlight.
Under that partnership, Genie offers same-day delivery of products purchased at downtown stores. The fee is $5 within the company’s delivery zone in the centre of the city, and $1 for every kilometre outside that zone. For the first week, deliveries were free for anyone who mentioned Genie on Twitter or Facebook, and the attention the company received on social media was unprecedented.
“It’s crazy; we’ve been flooded with messages,” sales director Simo Filalin told the Montreal Gazette.
When the coronavirus pandemic shuttered businesses, Montrealbased Tristan temporarily laid off 500 employees at its retail stores.
However, with 30 per cent of its products made in Canada, the family-owned company had the opportunity to convert its factory in Cookshire, in the Eastern Townships, to produce face shields. That plant was allowed to remain open because it makes clothing for the Royal Canadian Mounted Police and the Sûreté du Québec.
Health Canada approved the company’s application for faceshield manufacturing within a week, and Tristan began churning out the shields at a rate of several thousand per day.
The company has been selling its shields to hospitals around the province, and it also sells them online to the general public.
Perhaps one of the best-positioned companies to field the COVID-19 crisis was Pointeclaire’s Medicom, a local manufacturer of medical equipment including masks, gloves and gowns.
Medicom was awarded a 10-year contract by the federal government in March to produce 24 million surgical masks and 20 million N95 masks per year. It opened a factory on Stinson St. in St-laurent, and expects to be at full production in the next few weeks.
Keeping operations running was key for the company, because hospitals around the world depend on Medicom for vital equipment for fighting the virus.
Medicom has also built mask-making factories in Singapore and France as part of long-term agreements with those countries. The company is set to double its worldwide production within nine months.
The grocery and pharmacy business has undergone tremendous change in recent months, and while companies had to boost online services and hire more staff to adhere to hygiene measures, Metro said its bottom line has benefitted.
Montreal-based Metro, which also owns pharmacy company Jean Coutu, said the pandemic would increase the company’s profit margin significantly.
In April, the company estimated the impact of the virus will boost profits by about three cents per share, and represent a $125-million increase in sales.
Other grocery chains have also seen Covid-19-related profit boosts. Earlier this month, Empire Co., which owns the IGA chain of stores, reported a large profit increase, as Canadians are shopping less frequently, but buying more when they venture out.
Grocery companies had all offered a $2-per-hour pay hike to employees for working during the pandemic, but Metro, Empire and Loblaws all cancelled those hikes on the same day, raising the ire of the House of Commons, which will examine whether the decision ran afoul of the country’s competition laws.
PAUL DAVIS RESTORATION INC.
As businesses and stores reopen, demand is up for cleaning and disinfection services, and Paul Davis Restoration Inc. is one of the beneficiaries.
The Florida-based company has several locations in and around Montreal, and COVID -19-related work represents about one-quarter of its business, said Karine Melançon, managing director of the Montreal office.
Demand is up about 15 per cent since the crisis began. The company has about 30 full-time staff, in addition to a group of regular subcontractors.
“We’re extremely busy,” Melançon said. “The only time I can remember things being so hectic was in the spring of 2017, with the flooding in Pierrefonds.”
While Covid-19-related business is booming, restoration and repair work tied to water infiltrations, mould, fires or storms still makes up the bulk of the company’s business.