28th Annual CIBC Western Institutional Investor Conference: Conference Recap

Roman Dubczak: Hi, everybody. I’m Roman Dubczak, Deputy Chair at CIBC Capital Markets. Welcome to a recap of our 28th annual Western Institutional Investor Conference here at Whistler. Fantastic event this year. All time attendance record, over 880 people. Two and a half days of full agendas, thousands of meetings taking place. Just a terrific mood here at the conference. And I’m here joined by my colleagues, Sean Gilbert, Head of Debt Capital Markets and Lisa Raitt, Vice-Chair of Investment Banking at CIBC, as well. Let’s just do a bit of a recap. You know, Sean, what did, what were the themes you heard? What were some of the main topics of discussion? What were the companies consistently focused on?

Sean Gilbert: Yeah, you know, thank you. There were a lot of themes over the last two and a half days. Then, maybe I’m going to boil it down to five key points that I saw. Number one, and it was a lot of prognostication and pontification, over some of the announcements recently with respect to tariffs.

Roman Dubczak: – Yup.

Sean Gilbert: Every company that was in the room got asked that.

Roman Dubczak: It’s probably 100% of the conversations had the word tariff in it, yeah.

Sean Gilbert: You know, it’s early days and nothing is concrete. We’re, kind of, basically reading headlines. I thought the presenters handled it very well. One of the things that really came up was ‘volatility’, and that came in multiple forms. But what was interesting to me was a lot of the companies, I think generally speaking, we think that this will be bad, but I think that there was a lot of focus on some of the positives that may come out of this. And one of them on volatility, and one CEO said this, creates opportunity. It’s probably not the opportunity they want. But with respect to volatility in commodities, and with respect to the dollar, I think there was a little bit of projection as to how they could maybe capture some of the short-term positives. The dollar being a little weaker, probably was a bit of a headwind for some of the companies, but also a tailwind for others.

Number two, was data centres and basically how that would have impacted a lot of the companies presenting today. Gas producers, a lot of pipelines, and obviously, generation. So, there’s a lot of discussion on the data centres and the positive impacts that, that might have for the development of the Canadian economy and how Canada, and in particular, there was a lot of discussion around Alberta, could participate in that.

Roman Dubczak: I’d add, to the data centre point, I attended a variety of the meetings, popped in. I think every single utility oriented client had a full house. Absolutely wall-to-wall attendance for all the utility sessions to that point about energy generation, the usage of energy and that sort of thing.

Sean Gilbert: The third point I would emphasize, growth is back in vogue. And I think this, this conference now is several years away from Covid. And I think prior themes were with the world being disrupted and the potential impact on businesses and therefore balance sheets. And Roman, you and I talked about this in early videos in the last year. I think we talked about as well. There was a lot of focus on fortification of the balance sheets. There was a presenter who said it really well, “Growth is back in vogue”, and so I think that there wasn’t a bad word to say. It was a good word to say. In some of the conversations that I had with investors in the hallways, they were interested in growth, and they were telling me they were asking a lot of the companies about their growth plans.

The fourth point I would bring up is, constructive markets. The debt markets in particular, being a capital markets professional, but, has been very steady and constructive. And I think that gives companies the confidence in their growth plans. And I think those two points tie in and in their expansion. And the final point I would bring up is, this is a bit of a wake up call. And Lisa, maybe this is going to be a good transition to you. But there was some narrative that what’s going on right now is a bit of a wake up call. We will have a new Prime Minister. I’m not going to prognosticate in who it is, but we will have a new Prime Minister. And I did hear a lot of narrative around how this and this wake up call will sort of affect policy and therefore plans and growth plans going forward.

Roman Dubczak: So, Lisa.

The Hon. Lisa Raitt: Yeah.

Roman Dubczak: More thematically, you know, you led a panel discussion at the first lunch talking about the various machinations in both political and, you know, market worlds. And then, we had an amazing luncheon speaker, maybe want to kind of touch on that because that ticked all the boxes in terms of geopolitics as well.

The Hon. Lisa Raitt: Yeah. So, when Sean started off, you said there was a lot of prognostication or was the other ‘P’ word? –

Sean Gilbert: Pontification.

The Hon. Lisa Raitt: Pontification! I came in on the pontification side of it all, and we had, look, we decided that it was important for people just to get the big world view on what was going on. There’s so much volatility and it’s showing up in different places, but where’s the path through it all? Can we actually give some signals as to where we’re going. And we had a great panel, aside for me. We had Georgia who was the moderator of it had some great questions. We had Ian de Verteuil and we had Avery Shenfeld. So, the three of us don’t actually come from the same point of view regarding where we’re going, but we did actually agree on the fact that we’re probably looking at tariffs and that as a country, we’ve got to figure out what to do internally. And maybe that’s flowing over to what you’re hearing from the CEOs who are really starting to think about, well, what are we going to do given the set of circumstances we’re in, which is really unique in the world?

Roman Dubczak: You know, interesting point. If I could just interrupt on that. The CEOs, you know, there at the forefront seemed calm about it. They’re like, look, we don’t know,

The Hon. Lisa Raitt: – Yeah

Roman Dubczak: We’ll sort this out… Coming from a place of I think self-confidence and like really lucid thinking about what these things may end up being.

The Hon. Lisa Raitt: And determination. What you heard from a lot of CEOs was, I’m going to take it upon myself to get me and my team down to Washington, down to Mexico, and we’re going to help out. … to try to figure a way…

Roman Dubczak: And many have been already.

The Hon. Lisa Raitt: Yeah, yeah. For sure. And then we decided to then zoom out and talk about what’s going on geopolitically. Again, what’s happening in Canada is one thing. What’s happening in the world is quite another. And a lot of it goes back to Trump 2.0 and the pronouncements that have been coming up, you know, 3 or 4 days into his second term. So, we had General Stavridis here and we’ve enjoyed his presence before. He’s a great, great friend of CIBC. And he just came in and he walked us through what’s happening in the larger conflicts in the world. But again, you know, he talked about the opportunity that’s out there that it’s not all necessarily doom-and-gloom. Growth was another part of what he’s seeing, what he’s talking about and working together. But, the people inside that room definitely have a much broader view and a much greater depth of understanding of world conflict than what you’re going to get on television, quite frankly. So, fantastic opportunity for people to take back to their communities what they heard here.

Roman Dubczak: Yeah, great. Thanks, thanks Lisa. All I would add, in addition to those great points were, probably almost every presentation, I saw were balance sheets are in good shape.

Sean Gilbert: Yes.

Roman Dubczak: Access to capital is fine. No one’s particularly worried about access and capital for growth. And they’re thinking of growth. So, kind of, consistent with what we’ve been hearing about potentially a wave of M&A coming in the Canadian context. But for the fact that tariffs might kind of slow things down. So, that’s maybe a bit of a short-term mitigant, from an attendance perspective we had a far higher proportion of non-Canadian investors attending. So, that speaks to me that the world is looking at Canadian larger cap companies, that there may be an opportunity here from a value perspective. So look, thanks.

The Hon. Lisa Raitt: Thank you!

Roman Dubczak: It was a great couple days. I want to thank all our clients for, you know, attending Whistler, listening in on the webcast. And, just as a follow up, each of our industry analysts will be hosting a call in the subsequent days to go through individual industries. So, please keep an eye out for that on various social media. Want to thank you all for joining and see you soon. Thanks.