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These are stories Report on Business is following Friday, Dec. 19, 2014.

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Giving up a bonus
Rick Holley didn't think it fair that he got a bonus when his shareholders didn't.

So the chief executive officer of Plum Creek Timber Co. gave it back.

Yes, really.

"The award, which would have vested entirely on Feb. 3, 2017, was made to Mr. Holley as incentive for him to remain in his position as chief executive officer for the next several years," the Seattle-based real estate investment trust said in a regulatory filing this week, referring to the 44,445 restricted stock units awarded by his board's compensation committee.

"However, in light of prevailing economic conditions, Mr. Holley elected to return the restricted stock units because he does not believe that he should receive such an award unless Plum Creek's stockholders see an increase in their investment return."

Mr. Holley also told Fortune that the move was a surprise to his board.

"I told them I wasn't asking for their approval," Mr. Holley, who wasn't immediately available to comment today, told the magazine.

"They had given these to me and I appreciated their confidence in me, but I didn't feel comfortable taking them … This has been a year where total shareholder returns are down 10 per cent or more. It just wasn't the right thing to do."

Those units are worth just shy of $1.9-million (U.S.), based on yesterday's New York close.

Indeed, the units are down almost 10 per cent this year, and underperformed the S&P 500 by more than 20 per cent.

But investors will no doubt cheer Mr. Holley, who has been with the company since 1985 following stints with General Electric Co. and Burlington Northern Inc.

Mr. Holley, CEO for about two decades now, heads a company described by REIT magazine as one of the biggest private landowners in the United States, and the first public traded timber REIT.

Plum Creek also heralds its environmental record, saying it operates "by sustaining the essential qualities of our land and timber, natural resources, native habitat, scenic beauty, species diversity and recreational opportunities."

It dates back to 1944, when Plum Creek Logging Co. was formed.

"Timber REITs, just like REITs that lease commercial or residential real estate, allow investors to diversify their portfolio while providing access to a significant long-term dividend yield," Mr. Holley recently told REIT magazine.

"The trees growing on the land for as much as 80 years are real property similar to an apartment building or hotel, providing the investor with strong income growth from a renewable resource that, when held for the long term, has historically appreciated faster than inflation."

Mr. Holley, who's 62 years old, was schooled in accounting and business admin in California.

He has three kids and six grandchildren.

He also sits on several boards, and, according to the magazine, is "heavily involved" in charities.

Now CEO, he was previously chief financial officer.

He started out at GE in 1974, then headed to Burlington in 1983, and to Plum Creek in 1985.

He's on the board of the National Alliance of Forest Owners and Resources for the Future, among others. He's also on the San Francisco Fed's economic advisory council.

Ontario downgraded
One of the world's big three ratings agencies has dealt Ontario a blow, downgrading the Canadian province but raising its outlook.

Fitch Ratings downgraded the province to double-A-minus from double-A, at the same time revising its outlook to "stable" from "negative."

The Ontario Liberals now have a majority government, having recently won re-election, and the debt is now forecast to climb next year to 256 per cent of revenue from this year's 249 per cent.

Indeed, Moody's Investors Service warned earlier this week that the debt burdens of Ontario and New Brunswick will rise at the fastest pace of all the provinces next year.

"Difficult actions will be necessary to achieve the province's deficit elimination goal of fiscal 2018 and budget options are likely to prove more limited given the extent of actions taken to date and use of one-time actions to achieve targets, in Fitch's opinion," the agency said today.

"While the province is considering other fiscal options for fiscal 2016 should economic conditions restrain future revenue growth, the downgrade to double-A-minus reflects Fitch's concern that risks remain to achieving its goals and both debt burden and the deficit will remain significantly elevated."

Fitch noted that Canada's most populous province has made "steady, positive progress" this year and, in fact, has beat its near-term goals.

But "full fiscal recovery remains several years away."

Ontario's economic fortunes are changing, by the way, at least in relation to the country's other provinces.

Just this week, Toronto-Dominion Bank projected the central province will now lead the country in average annual economic growth over the next two years as the oil powerhouse of Alberta is hit by the oil price plunge.

BlackBerry slips
Shares of BlackBerry Ltd. slipped today after the company reported its revenue tumbled in the third quarter but still boasted of a "key milestone" of positive cash flow.

Revenue fell to $793-million (U.S.) from $1.2-billion a year earlier, The Globe and Mail's Sean Silcoff reports, missing the estimates of analysts.

BlackBerry's loss for the quarter, though, narrowed to $148-million, or 28 cents a share, from the exceptional loss of $4.4-billion or $8.37 a year earlier.

On an adjusted basis, BlackBerry posted a penny-per-share profit.

"We achieved a key milestone in our eight quarter plan with positive cash flow," said chief executive officer John Chen, referring to the $43-million it reported today.

"Our focus now turns to expanding our distribution and driving revenue growth," he added in a statement.

Inflation eases
Consumer prices fell in Canada last month, and annual inflation eased, as costs at the gas pump plunged.

The annual inflation rate dipped to 2 per cent – bang on the Bank of Canada's target – from October's 2.4 per cent.

That came, of course, as gasoline prices declined by 5.9 per cent from a year earlier, Statistics Canada said today.

The so-called core rate, which strips out volatile items and helps guide the central bank, dipped to 2.1 per cent in November from 2.3 per cent a month earlier, The Globe and Mail's David Parkinson reports.

On a monthly basis, core prices were flat.

"We look for [the core rate] to dip below 2 per cent in the early months of 2015, with a more decisive move in total CPI on lower gasoline prices," said chief economist Avery Shenfeld of CIBC World Markets.

"The low CPI would normally be bearish for the [Canadian dollar], and supportive for short-term yields, but nobody was talking about any BoC rate hikes in the near term in any event."

From October, consumer prices edged down 0.4 per cent, or 0.2 per cent on a seasonally-adjusted basis.

While gas prices fell, most other stuff rose in the 12-month period.

Indeed, prices jumped in seven of the statistics agency's eight measures, including food and shelter.

Toronto-Dominion Bank, by the way, says lower pump prices should save the average Canadian family about $300 a year.

DBRS said near sale
Two private-equity groups are reportedly poised to swallow Canadian rating agency DBRS Ltd.

Carlyle Group LP and Warburg Pincus LLC have struck a tentative deal to buy DBRS Ltd. for more than $500-million (U.S.), the Wall Street Journal reports.

The two private equity first topped bids by two others, according to the report, and the agreement in principle may include DBRS managers and what the news organization referred to as "high-profile" Canadian investors.

DBRS, a minnow in a sector dominated by Moody's Investors Service, Standard & Poor's Ratings Services and Fitch Ratings, could benefit greatly and become a "more serious global contender" with the deep pockets of Carlyle and Warburg Pincus, the Journal said.

A deal could be unveiled as early as Friday, according to the report.

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Tickers mentioned in this story

Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 18/03/24 4:00pm EDT.

SymbolName% changeLast
CG-Q
The Carlyle Group
+0.96%45.01
CM-N
Canadian Imperial Bank of Commerce
+0.73%49.6
CM-T
Canadian Imperial Bank of Commerce
+0.72%67.17
GE-N
General Electric Company
+0.6%169.91

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