MONTREAL – CAE’s activities in the Middle East came under scrutiny Wednesday during the flight training and simulation technology company’s annual meeting.
The so-called Boycott Divestment and Sanctions (BDS) movement — which, last weekend, won Green Party support for a resolution supporting sanctions against Israel — urged the Montreal-based company to adopt a comprehensive military embargo against the Jewish State.
During question period, members of the group pointed to contracts obtained by CAE in recent years. These include a 2013 deal with Elbit Systems for the sale of parts and other flight simulator components to train Israeli Air Force pilots, simulator upgrades for attack helicopters for Israel, and a collaboration with an Israeli firm that specializes in drones.
“Israeli companies sell products they claim have to be field-tested,” BDS representative Sabine Friesinger told reporters after the CAE meeting. “What does that mean? Tested on the Palestinian civilian population?”
The BDS movement has gained momentum in recent months. Supporters say it’s aimed at supporting Palestinian independence, while critics say the campaign is aimed at delegitimizing Israel itself.
CAE chief executive Marc Parent responded that the company strictly adheres to Canadian rules in place, adding that the contracts mentioned by BDS at the meeting have expired.
Parent later told reporters he has no intention to stop conducting business in regions like Israel.
“I am responsible for managing the company for shareholders,” he said. “We make decisions that will grow shareholder value of the company.”
Parent said he is very “sensitive” that some business relationships could have an impact on a company’s image.
Ontario firm General Dynamics Land Systems, for instance, made headlines because of a controversial $15-billion contract to sell light armoured vehicles to Saudi Arabia.
BDS said it attended CAE’s shareholder meeting after a request in March to meet with the company’s management was unanswered. Communications vice-president Helene-Gagnon will meet with representatives in a couple of weeks.
Meanwhile, CAE (TSX:CAE) raised its dividend seven per cent to eight cents per share after its net profit surged on higher revenues in the first quarter.
Net income attributable to shareholders rose 53 per cent to $68.7 million or 25 cents per share, up from $44.9 million or 17 cents per share a year earlier.
Revenues increased 17 per cent to $651.6 million as its order backlog reached a record $6.5 billion.
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