MONTREAL – The brothers who head investment conglomerate Power Corp. of Canada said they were being unfairly criticized as the company’s annual meeting became the latest target in the ongoing protests in Quebec.
The demonstration was one of several Tuesday in the province, where about one-third of post-secondary students are boycotting classes in a protest against tuition hikes that has lasted more than three months.
“We’re a very caring company and I think a very caring family and we care about the society around us and we’ve always demonstrated that,” chairman Paul Desmarais Jr. said after the company’s annual meeting Tuesday.
Outside the meeting, police blocked the entrances to the hotel in Old Montreal where a few dozen protesters denounced Quebec’s richest family.
At least one person was forcibly removed as officers used pepper spray against the crowd who at one point tried to enter the building.
Protesters — some of whom were masked in balaclavas — banged drums and carried posters saying “Your wealth = our poverty.”
“I think Power Corp. is a very good example of the one per cent and it shows how private companies can be more powerful than some countries,” said a female protestor, who didn’t want to give her name.
Desmarais and his brother Andre, who is co-chief executive, said they were very concerned, like all citizens, about the social unrest that’s gripping Quebec.
“We want this issue to be resolved hopefully in a respectful fashion … in a democratic way, within the rule of law …that makes sense and where everybody invests in the future of our students,” Paul Desmarais added.
But he refused to say if he backed the Charest government’s plan to boost tuition fees that sparked the protests.
In fact, the brothers said they were reluctant to publicly comment on public issues except when they’re asked to by governments on financial issues.
“Frankly I’m not elected. Why should I meddle in things of people who are elected to resolve these problems. Our job is to manage our company,” said Paul Desmarais.
They also refused to comment on the electoral defeat of their friend, former French president Nicolas Sarkozy.
The company has said it is worried about the economic turmoil in Europe, but that its holdings are well-insulated from any major impact.
“There’s no question that there are many things to come and I think we all worry about that,” Desmarais told reporters.
But he added that Power (TSX:POW) has little exposure in Greece, Italy, Spain or Ireland, the eurozone countries that are most vulnerable.
And a drop in the value of the euro could actually help increase Power’s profits when translated into U.S. or Canadian dollars.
Although its European holdings are mostly headquartered in France, the diversified nature of its global investments offer a natural hedge because they operate around the world including in developing countries, Desmarais said.
Earlier, shareholders approved the cutting of Power’s board of directors nearly in half. Nine of the 21 directors stepped down, including former deputy prime minister Don Mazankowski.
Former Caisse de depot CEO Henri-Paul Rousseau and John Rae were among the employees who were also excluded to maintain a majority presence of independent directors.
The holding company reported Tuesday a first-quarter profit attributable to shareholders of $264 million, or 57 cents per share, up from $216 million, or 47 cents per share during the quarter a year ago.
Revenue totalled $7.2 billion, up slightly from $7.03 billion.
Subsidiaries contributed $244 million to operating earnings, down 1.6 per cent from $248 million in the quarter a year earlier.
Corporate activities resulted in a net charge of $23 million, up slightly from a net charge of $20 million in the 2011 period.
The company also benefited from $30 million in gains on the partial sale of wine and spirits producer Pernod Ricard and $28 million from the disposal of French chemicals producer Arkema.
Its main subsidiary, Power Financial (TSX:PWF), whose primary business is insurance and mutual funds, reported Monday that its profits increased 23 per cent to $455 million during the first quarter on gains from the sale of the two European assets.
Power Financial’s profit attributable to common shareholders amounted to 64 cents per share for the period ended March 31, up from 52 cents per share in the prior year.
Power Corp. holds interests, directly or indirectly, in companies that are active in the financial services, communications and other business sectors.
Shares in the company closed at $24.61, up nine cents in Tuesday trading on the Toronto Stock Exchange.