Chip Wilson sold just under $83-million worth of his company Lululemon’s Nasdaq-traded stock in 2022.Fred Lum/The Globe and Mail
Executives and board members at Canadian companies managed to sell millions of dollars’ worth of stock in 2022′s volatile markets, even if the spoils weren’t as great as in previous boom years.
A Globe and Mail analysis of insider stock sales, in collaboration with INK Research, found no Canadian executive or director sold $100-million worth of shares or more in 2022, after 10 people topped the century mark in 2021, with four selling more than $250-million worth of shares.
The research found just 14 insiders at 10 companies sold $25-million worth of stock or more last year, a steep drop from 37 in 2021. The sellers earned total proceeds of about $550-million in 2022; in 2021, the top sellers grossed nearly $3.6-billion.
Big sellers
More than a dozen company insiders sold at least $25-million
worth of company stock in 2022:
Company
Name
Sales (millions)
Lululemon
Chip Wilson
$83.0
Brookfield
Brian Kingston
$61.9
FirstService
Jay Hennick
$51.3
TFI
Alain Bedard
$50.2
Canadian Natural Res.
Murray Edwards
$39.2
Power Corp.
André Desmarais
$37.3
Canadian Natural Res.
Steve Laut
$31.9
Cenovus
Alex Pourbaix
$31.2
Teck
Marcia Smith
$30.5
Shopify
John Phillips
$27.9
Cenovus
Jonathan McKenzie
$27.2
BCE
Wade Oosterman
$26.4
Shopify
Robert Ashe
$26.1
GFL Environmental
Patrick Dovigi
$25.4
the globe and mail, Source: INK Research; The Globe and Mail
Big sellers
More than a dozen company insiders sold at least $25-million
worth of company stock in 2022:
Company
Name
Sales (millions)
Lululemon
Chip Wilson
$83.0
Brookfield
Brian Kingston
$61.9
FirstService
Jay Hennick
$51.3
TFI
Alain Bedard
$50.2
Canadian Natural Res.
Murray Edwards
$39.2
Power Corp.
André Desmarais
$37.3
Canadian Natural Res.
Steve Laut
$31.9
Cenovus
Alex Pourbaix
$31.2
Teck
Marcia Smith
$30.5
Shopify
John Phillips
$27.9
Cenovus
Jonathan McKenzie
$27.2
BCE
Wade Oosterman
$26.4
Shopify
Robert Ashe
$26.1
GFL Environmental
Patrick Dovigi
$25.4
the globe and mail, Source: INK Research; The Globe and Mail
Big sellers
More than a dozen company insiders sold at least $25-million worth of company stock in 2022:
Company
Name
Sales (millions)
Lululemon
Chip Wilson
$83.0
Brookfield
Brian Kingston
$61.9
FirstService
Jay Hennick
$51.3
TFI
Alain Bedard
$50.2
Canadian Natural Res.
Murray Edwards
$39.2
Power Corp.
André Desmarais
$37.3
Canadian Natural Res.
Steve Laut
$31.9
Cenovus
Alex Pourbaix
$31.2
Teck
Marcia Smith
$30.5
Shopify
John Phillips
$27.9
Cenovus
Jonathan McKenzie
$27.2
BCE
Wade Oosterman
$26.4
Shopify
Robert Ashe
$26.1
GFL Environmental
Patrick Dovigi
$25.4
the globe and mail, Source: INK Research; The Globe and Mail
“A lot of the insider selling we’ve been seeing has been modest in comparison to the previous year because stock price levels have generally, outside of the resource area, come down, so there was less incentive for broad insider selling,” said INK Research chief executive officer Ted Dixon, whose company tracks insider buying and selling to help generate investment ideas.
“Generally, over the past year, insiders have been neither rushing for the exits nor buying up a storm. I think, like many of us, they’re just trying to get a sense of what’s ahead,” he said.
INK Research analyzed insider sales at Toronto Stock Exchange-listed companies. The Globe supplemented INK Research’s work by looking at records of stock sales by Canadian executives at large companies listed on U.S. exchanges. All U.S. stock sales were converted to Canadian dollars using rates on the day of the transaction.
In contrast to 2021, when many insider sales came from company founders selling large blocks of stock they owned outright, the 2022 list is dominated by executives who acquired shares by exercising stock options, and then quickly sold most or all of those shares on the open market.
The list of top sellers is based on gross proceeds from selling shares, as disclosed by the insiders to Canadian or U.S. regulators, and does not reflect what profits the executives may have made on the sales, compared with what they originally paid.
The Globe contacted all companies that had an insider who sold $25-million or more in shares. A number objected to the inclusion of their executives on the list, with some denying that the exercise of a stock option from the company’s compensation plan meant the executive had sold stock.
Others objected to The Globe’s use of gross proceeds, not net stock-option profits. Some of the companies only offered their feedback as background information, not to be quoted, on how to view selling by their executives.
According to Canadian insider-sales disclosures, Cenovus Inc. CVE-T CEO Alex Pourbaix sold $31.2-million worth of shares after option exercises, while executive vice-president Jonathan McKenzie sold $27.2-million.
In an e-mailed statement, Cenovus said the two executives did not sell shares they owned. Cenovus said they used a “cashless exercise mechanism” under the Cenovus stock option plan, which allows participants to receive option profits as cash or shares.
Cenovus said that when Mr. Pourbaix exercised his options, he took half of the profits in shares, and as of last March, his share ownership was 15.8 times his base salary. (The Cenovus employee answering the questions declined to identify themselves.)
Cenovus Energy names Jon McKenzie as new CEO
At Power Corp. of Canada, former co-CEO André Desmarais sold nearly $37.3-million worth of stock after exercising stock options. The Globe calculates that Mr. Desmarais made about $10.7-million in pretax profit from the options.
General counsel Stéphane Lemay said in an e-mail that Mr. Desmarais’s transactions reflect compensation from options he held nearly until expiration. Mr. Lemay said they are not reflective of his commitment to the company, as his net ownership did not change following this transaction.
Mr. Lemay noted that the market value of shares and share units held or controlled by Mr. Desmarais was nearly $600-million in early February.
BCE Inc.’s Wade Oosterman, president of Bell Media, grossed $26.4-million from stock sales in 2022. More than $24.1-million of those sales came from exercising options. The exercise prices of the options totalled $19.9-million. Company spokeswoman Ellen Murphy said this means the “actual total value” of Mr. Oosterman’s stock transactions was the option profits plus other sales, or $6.46-million.
Brookfield Corp.’s BN-T Brian Kingston, the CEO of the company’s real estate business, grossed $61.9-million through stock sales in 2022. Unlike many executives, however, he kept a portion of his shares from exercising options, rather than selling them all. Over the course of 2022, Mr. Kingston exercised 1.125 million options and kept 182,724 of the underlying shares.
The Globe calculates Mr. Kingston made just over $32-million in profits on the options that led to share sales, while he had a pretax gain of $6.6-million on the options transactions in which he kept the underlying shares.
Teck Resources Ltd.’s TECK-A-T TECK B-T Marcia Smith, its former senior vice-president for sustainability and external affairs, sold $30.5-million worth of shares in 2022. Teck spokesman Chris Stannell said Ms. Smith announced her retirement last year as Teck shares hit a 10-year high and exercised options that were due to expire in 2023. Stock-sale records show Ms. Smith paid about $11-million to exercise the options, giving her a pretax profit of about $19.5-million.
At Canadian Natural Resources Ltd. CNQ-T, executive chair and company founder Murray Edwards sold $39.2-million worth of shares, while board member and former president Steve Laut sold $31.9-million worth.
A portion of Mr. Edwards’s proceeds, $14.6-million, came through the exercise of 180,000 stock options. Other sales came from his existing holdings: At the end of 2022, Mr. Edwards held 21.2 million Canadian Natural shares worth nearly $1.6-billion.
While long-time and retiring executives took up many slots on the sales list, company founders were also prominent sellers – although their transactions, like those of Mr. Edwards, represented just a small piece of their wealth.
The top 2022 seller was another founder, Lululemon Athletica Inc.’s LULU-Q Chip Wilson, who sold just under $83-million worth of his company’s Nasdaq-traded stock in 2022. His 10.7 million shares in the company were worth about $4.6-billion at the end of 2022.
Jay Hennick sold $51.3-million in stock in FirstService Corp., but also bought $35.8-million worth of Colliers International Group Inc., where he serves as chairman. Mr. Hennick told The Globe by e-mail he sold stock to help make charitable donations.
“I am the founder of both companies and remain the largest individual shareholder,” Mr. Hennick wrote. “Both companies are extremely well-managed and have a tremendous future growth opportunities (i.e. both are great investments).”
“However, as you might have noticed, my wife and I made two very large benefactions this year. One to name Hennick Bridgepoint Hospital and the other which is the largest gift ever to the Royal Ontario Museum, to help revitalize the ROM for future generations,” Mr. Hennick wrote. “I hope that helps you see the bigger picture, at least for us.”