Action List

Our Best Ideas

Equity Research

January 1, 2012

Introduction
The Action List is a monthly publication that identifies our analysts top investment recommendations. As well, it provides a list of important industry milestones to watch for in the coming month and an update on our sector stances. The report also includes updates from our Strategy and Quantitative research teams. While it is always difficult for compendium publications to be both timely and informative, we believe that our product strikes a good balance compared to the quarterly products offered by many of our competitors. At times, if we are not bullish on a particular sector, we may not have an Action List pick in that space. The performance of our Action List picks is monitored on an ongoing basis against the relevant S&P/TSX benchmarks.

J. P. Benson, CFA Head of Research

TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank.

YOUR ATTENTION IS DIRECTED TO THE IMPORTANT DISCLOSURES IN APPENDIX A.

Please see pages 95 to 99 for important disclosure information, including disclosures on Quantitative Research. This report is strictly a summary. It should not be used as the sole basis for investment decision-making. For information relating to Justification of Target Price and Key Risks to Target Price please visit our website at https://www.tdsresearch.com/equities/disclosures.

Table of Contents
TD Securities Action List (as of December 30, 2011)............................................. 4 Action List Additions and Deletions Since Our Last Edition .................................. 5 Performance Review ............................................................................................... 6 Investment Strategy................................................................................................. 8 Quantitative Analysis ............................................................................................ 11 Alternative Energy ................................................................................................ 18 Banks..................................................................................................................... 21 Biotechnology & Health Care ............................................................................... 24 Chemicals & Fertilizers......................................................................................... 26 Communications ................................................................................................... 29 Consumer Discretionary........................................................................................ 32 Consumer Staples.................................................................................................. 35 Diversified Financials ........................................................................................... 38 Energy Producers Intermediate .......................................................................... 41 Energy Producers International.......................................................................... 44 Energy Producers Senior & Unconventional ..................................................... 47 Energy Services..................................................................................................... 50 Gold & Precious Minerals..................................................................................... 53 Industrial Products ................................................................................................ 56 Insurance ............................................................................................................... 59 Media .................................................................................................................... 62 Metals & Minerals................................................................................................. 65 Multi-Industry ....................................................................................................... 68 Paper & Forest Products........................................................................................ 70 Pipelines, Power & Utilities .................................................................................. 73 Real Estate............................................................................................................. 76 Special Situations .................................................................................................. 79 Technology............................................................................................................ 82 Transportation Aerospace .................................................................................. 85 Transportation Railroads .................................................................................... 88 Upcoming Events .................................................................................................. 93 Action List Rules................................................................................................... 94 Appendix A. Important Disclosures...................................................................... 95

TD Securities Action List (as of December 30, 2011)

Page 18 21 24 26 29 32 35 38 41 44 47 50 53 56 59 62 65 68 70 73 76 79 82 85 88 Sector Alternative Energy Banks Biotechnology & Health Care Chemicals & Fertilizers Communications Consumer Discretionary Consumer Staples Diversified Financials Energy Producers Intermediate Energy Producers International Energy Producers Senior & Unconventional Energy Services Gold & Precious Minerals Industrial Products Insurance Media Metals & Minerals Multi-Industry Paper & Forest Products Pipelines, Power & Utilities Real Estate Special Situations Technology Transportation Aerospace Transportation Railroads Action List Pick None Canadian Imperial Bank of Commerce None Agrium Inc. Thomson Reuters Corp. Manitoba Telecom Services Inc. None Alimentation Couche-Tard Inc. Loblaw Companies Ltd. None None Bankers Petroleum Ltd. Canadian Natural Resources Ltd. Talisman Energy Inc. Trican Well Service Ltd. None SNC-Lavalin Group Inc. None Corus Entertainment Inc. Teck Resources Ltd. First Quantum Minerals Ltd. None None ATCO Ltd. None TransForce Inc. None Chorus Aviation Inc. None Ticker CM-T, N AGU-N TRI-T MBT-T ATD.B-T L-T BNK-T, L CNQ-T, N TLM-T, N TCW-T SNC-T CJR.B-T; CJR-N TCK.B-T FM-T ACO.X-T TFI-T CHR.A CHR.B-T Share Price $73.79 US$67.11 $27.23 $29.67 $31.70 $38.48 $4.44 $38.15 $12.75 $17.55 $51.08 $20.52 $35.91 $20.05 $60.24 $12.95 $3.17 Target Price $94.00 US$115.00 $43.00 $40.00 $38.00 $50.00 $11.50 $53.00 $21.00 $30.00 $69.00 $24.00 $58.00 $27.00 $78.00 $19.00 $5.00

Additions to the Action List since our last edition.

Action List Additions and Deletions Since Our Last Edition

Additions
Chorus Aviation Inc. (CHR.A CHR.B-T; effective December 19, 2011) We added Chorus to the Action List as its shares have underperformed comparables over the past several months, resulting in an extremely compelling valuation, in our view. The dividend yield is 19%, the free cash flow yield is 29%, and the company is trading at a 22% discount to comps on 2012 EBITDAR. We believe that the market is discounting excessive risk related to the ongoing benchmarking and rate reset processes with Air Canada. We like the earnings and cash flow stability of the business, the downside protection provided by the CPA with Air Canada, and the dividend yield. Talisman Energy Inc. (TLM-T, N; effective December 19, 2011) We added Talisman Energy to the Action List on December 19. This upgrade comes on the back of the three following reasons: 1) it is now trading at a 30% discount to its 2P NAV, 2) it is now only trading at about a 1x premium to its 2008 lows, a time when oil prices were lower, and 3) we contend that fears related to its 2012 guidance release are overblown. As such, barring a major correction in oil prices, we believe that there is limited downside from current levels.

Deletions
Sandvine Corp. (SVC-T; effective December 7, 2011) We removed Sandvine from the Action List on December 6 following its Q4 warning, as temporary headwinds with four specific customers each drove a multimillion dollar revenue hit. The macro story is likely intact, but the fact that this was the second warning in fiscal 2011 raises credibility concerns. The significant discount to comparable Allot likely provides some downside protection, but the market is unlikely to pay more for Sandvine until revenue reflects the bullish comments by management, and leverage shows on earnings. Canaccord Financial Inc. (CF-T; effective December 16, 2011) The proposed Collins Stewart Hawkpoint acquisition adds some uncertainty to Canaccords outlook. Though this diversifies its platform into U.K. wealth management, complements its U.K. and U.S. capital markets divisions, and valuation seems fair, we see both execution and market risk in this sizeable deal. This affects the valuation multiples we use in deriving our target price. However, our BUY rating reflects our view that Canaccord remains well capitalized, has leverage to improving market conditions, and current valuation is attractive.

Performance Review
December was a mixed month for equity markets. Despite a rally of close to 2% in the months final trading days, the S&P/TSX Composite closed down 1.7%, with only 43% of stocks posting positive returns. Excluding the financial crisis of 2008, there has not been a negative December since 1996, when it was down 1.2%, or a decline this large since 1981, when the Index shed 2.3%. Despite the negative month, the strong October rally of 5.6% contributed to a positive fourth quarter of 3.6%. In the U.S., the S&P 500 and Dow Jones Industrial Average finished up 1.0% and 1.4%, respectively, while the NASDAQ Composite dropped slightly by 0.6%. Market breadth was also slightly better, with 55% of S&P 500 stocks posting positive returns. In Q4, the S&P 500 was up a whopping 11.8%, and as in Canada, Octobers 10.9% gain significantly boosted returns, making it the best Q4 since 2003, when the market was up 12.2%. At the sector level in Canada, on a price basis, Telecoms and Industrials were the best performing sectors, up 4.8% and 3.0%, respectively, while Materials (particularly Gold and Precious Metals & Minerals) and Information Technology were the worst performers, down 11.6% and 10.2%, respectively. In the U.S., Telecoms and Utilities led the way up with respective 3.7% and 3.0% gains, while resource stocks Materials and Energy were the worst. Overall, it was a challenging year for the Materials sector, posting 2011 returns of -21.8% in Canada and -11.6% in the U.S. However, its relatively larger index weight in Canada of 21.1% versus 3.5% in the U.S. helps explain the yearly return difference of -8.7% for the S&P/TSX Composite and the S&P 500 return of 2.1%. Our Action List returned -2.0% on the month, slightly underperforming the S&P/TSX Composite by 30 bps. Our best performing group for the month in which we had a selection was Media. On the year, our Action List returned -3.8%, outperforming the S&P/TSX Composite by 490 bps. Our best performing group was Gold & Precious Metals.

Total Return (%) Indices Action List S&P/TSX Composite Equal-Weight Benchmark S&P 500 NASDAQ Composite* Dow Jones Industrial Average*
* Price return only.

1-Month -2.0 -1.7 -0.6 1.0 -0.6 1.4

Year-to-Date -3.8 -8.7 -8.9 2.1 -1.8 5.5

TD Securities Action List Performance*

December 2011
TD Securities Action List
-2.0 -1.7

Year-to-Date
TD Securities Action List
-3.8 -8.7

Gold & Precious Metals Media Transportation - Aerospace Paper & Forest Products Consumer Staples Energy Producers - Senior & Unconventional Energy Services Energy Producers - Intermediates Fertilizers & Chemicals Health Care Consumer Discretionary Special Situations Industrial Products Metals & Minerals Real Estate Banks Multi-Industry Alternative Energy Insurance Transportation - Railroads Communications Pipelines, Power, & Utilities Energy Producers International Technology Diversified Financials -50
-31.5

-15.3

0.0 8.8

Gold & Precious Metals

0.5

-18.4 -52.5 -18.2

25.5

Technology Real Estate Media

10.7 4.5 0.0 -6.0 6.4 1.9 -1.5 -0.3 0.0 -1.2 -4.2 -5.1 0.0 -0.7 0.0 -0.6 -1.7 -2.1 2.2 1.8 -2.6 -2.1 1.4 2.0 2.4 3.1 0.0 0.0 0.0 0.0 -1.2 -2.9 -12.8 0.8 0.9 2.7 4.5 4.3 3.5 0.7 1.1

21.7 -32.2 -1.6 22.0 8.2 0.0 0.0

53.2

Consumer Discretionary Transportation - Aerospace Insurance Energy Producers - Intermediates Fertilizers & Chemicals Industrial Products Energy Producers - Senior & Unconventional Special Situations Consumer Staples Metals & Minerals Banks
-73.8 -26.8 -29.0

-6.0 -19.3 -20.9 -17.7 -4.2 -19.3 -6.8 -4.8 -15.5 -6.3 -16.4

7.3

9.1 6.8

1.9 1.1

Paper & Forest Products

-74.0

Multi-Industry Energy Producers International Communications Alternative Energy Pipelines, Power, & Utilities Energy Services Transportation - Railroads Health Care
-14.7 -0.7 -26.3 -18.0 -2.0

0.0 5.4

7.5 0.0 10.5 10.2 24.1

-1.2

0.0 0.0 -47.3

19.3 50.4

-10.2 0.1

-25.8

Diversified Financials 30 50 -100

3.4

-30

-10

10

-50 Action List

50 Comp Group

100

Action List

Comp Group

*% total return.

Investment Strategy
John Aitkens 416 307 9366 john.aitkens@tdsecurities.com

Three more countries Australia, China and Japan recorded a PMI above 50 in December. Of the 22 countries that we track, 8 now have PMIs above 50. Only five posted declining PMIs in December, and these declines were no more than 1 point. Most countries showed PMI gains in the month, some quite large. These countries were Australia, India, Taiwan, and the U.K. This PMI data reinforces our view that the global economy is shifting from deceleration (soft landing) to re-acceleration. As we see it, almost all countries should have a PMI above 50 by the spring, with European nations being the obvious laggards. The details behind the better-than-expected US ISM PMI (53.9 exp 53.5) were also very encouraging. The US employment index jumped to a six-month high of 55.1. This will be an employment rich re-acceleration, because productivity has slowed, as it always does at this point in the recovery. Employment growth will likely make the recovery self-sustaining and contribute to a faster-than-expected decline in the U.S. government deficit. The US inventory index dropped to 47.1, and, impressively, the customer inventory index dropped sharply to a seven-month low of 42.5. Both suggest tight inventories, which is why U.S. production is rebounding as companies attempt to rebuild inventory. The shift to inventory rebuilding has been an important driver of all past re-accelerations. The U.S. new orders index increased to 57.6, an eight-month high. This forward looking indicator suggests that the big decline in shipments some expect in early 2012, as bonus depreciation drops to 50% from 100%, will not materialize. U.S. new export orders continued to rise, and is now at 53.0, suggesting any weakness in exports to Europe is being more than offset by strength elsewhere. The re-acceleration is global in scope. Europe is lagging, but not preventing, the reacceleration of the global economy. We continue to believe that the transition in the global economy from soft landing to re-acceleration is under way, and will be complete by the spring. We therefore continue to recommend an overweight in stocks and an underweight in bonds. We recommend overweighting higher beta sectors (resources, technology, industrials, consumer discretionary), while underweighting defensive sectors (utilities, telecom, consumer staples).

TSX Group Weightings

Overweight Energy Materials ex Gold Industrials Consumer Discretionary Technology Market Weight Gold Health Care Financials Underweight Consumer Staples Telecom Utilities

Exhibit 1.

Global PMI's
Sep 11 Australia Austria Brazil Canada China HSBC China NBS Czech France Germany Greece India Ireland Italy Japan Korea Netherlands Poland Russia Spain Taiw an Turkey UK US 42.3 48.7 45.5 55.1 49.9 51.2 52.3 48.2 50.3 43.2 50.4 47.3 48.3 49.3 47.5 48.9 50.2 50.0 43.7 44.5 51.5 50.8 51.6 Oct 11 47.4 48.0 46.5 53.7 51.0 50.4 51.7 48.5 49.1 40.5 52.0 50.1 43.3 50.6 48.0 48.0 51.7 50.4 43.9 43.7 53.3 47.8 50.8 Nov 11 47.8 47.6 48.7 53.3 47.7 49.0 48.6 47.3 47.9 40.9 51.0 48.5 44.0 49.1 47.1 46.0 49.5 52.6 43.8 43.9 52.3 47.7 52.7 Dec 11 50.2 49.0 49.1 54.0 48.7 50.3 49.2 48.9 48.4 42.0 54.2 48.6 44.3 50.2 46.4 46.2 48.8 51.6 43.7 47.1 52.0 49.6 53.9 change 2.4 1.4 0.4 0.7 1.0 1.3 0.6 1.6 0.5 1.1 3.2 0.1 0.3 1.1 -0.7 0.2 -0.7 -1.0 -0.1 3.2 -0.3 1.9 1.2

Exhibit 2.
U.S. Purchasing Managers' Index ISM
70 70

60

60

53.9

50

50

40

40

30

82

84

86

88

90

92

94

96

98

00

02

04

06

08

10

12

30

M431

Shaded Areas Represent U.S. Economic Recessions

DEC 2011

Exhibit 3.
Purchasing Managers' New Orders Index
80 80

70

70

60
57.6

60

50

50

40

40

30

30

20

82

84

86

88

90

92

94

96

98

00

02

04

06

08

10

12

20

M659

Shaded Areas Represent U.S. Economic Recessions

DEC 2011

10

Quantitative Analysis
Chris Dutton, CFA 416 308 1554 chris.dutton@tdsecurities.com

January 2012 Looking into 2012, we see several negative trends that can make it difficult for the Canadian market to achieve a sustained recovery. Most important, from our quantitative perspective, is the decline in the earnings cycle. Both trailing and forward earnings momentum peaked late last year, and we expect both to continue to decline into the first half of 2012. With the possibility of further earnings disappointments and downward estimate revisions, multiple expansion will not come easily for stocks, particularly in such an uncertain global macro environment (Exhibit 1). Given this view, we believe that four investment styles will continue to outperform: growth over value, non-cyclical over cyclical, large cap over small cap, and income. In periods of slow growth, stocks with the ability to grow attract premiums. U.S. technology is, for example, a growth sector that we believe will continue to outperform. Within each sector, stocks that have a better relative growth profile should also receive a relative premium. Similarly, non-cyclical stocks should outperform cyclical stocks. We believe that deep or late cyclicals such as base metals, energy, and industrials (ex transports) are likely to underperform, given their higher sensitivity to the global economy. With Europe likely entering a recession, and, with China growth slowing, we believe that economically sensitive commodities are at risk through 2012. Indeed, the Chinese stocks and commodities recent weakness should be of particular concern for the TSX, given its recent track record of leading both indices (Exhibit 2) However, with the U.S. economy demonstrating an increasingly well defined recovery, early cycle cyclicals, such as consumer discretionary, transports, and banks with U.S. exposure could perform relatively well. Over the next year, we could see a combination where both defensive sectors such as consumer staples and early cycle consumer discretionary both perform relatively well. Unlike the 2009-2010 top down recovery, we believe that 2012 and beyond will be a more traditional bottom-up, consumer-led recovery. It is important to note that if the U.S. can continue its relative recovery into 2012, we should also expect the U.S. dollar to recover, as investors rotate further into U.S. stocks. This could put added pressure on commodity prices, including gold. A declining Canadian dollar could also cause foreign investment in Canadian stocks to be withdrawn. The current environment also typically favours large cap stocks over small cap stocks. If global growth can re-accelerate, we would consider taking on greater risk through smaller cap names. In todays highly volatile trading environment, small caps are very risky, in our view. Finally, with interest rates likely to stay low through 2012, a premium may also be placed on income. We would, however, prefer non-cyclical yield over cyclical yield at this stage.

11

Materials We reduced our gold position last month in favour of banks, when several gold stocks retested their previous highs. As noted above, with the U.S. economy recovering, the U.S. dollars outlook has improved. It will be difficult for gold to rally, if U.S. economic conditions continue to improve into 2012. However, if the U.S. economy stalls and/or investors become concerned about U.S. debt levels, as we saw this past spring/summer, gold could stage a significant recovery. Energy We believe that oil prices near $100/bbl are fundamentally too high in a slowing global growth environment. U.S. inventory data, which was bullish through the fall, has turned negative in the past month. The backwardation in Brent oil futures suggest that the market continue to price in near-term supply risk, likely due to geopolitical uncertainty. If Brent futures spreads reverse into contango, an oil correction back toward $75/bbl becomes likely. This could be an important catalyst for re-accelerating earnings in the non-energy cyclical sectors. In the energy sector, we believe that the premium on income has become dangerously high. Relative valuation spreads are too wide, in our view (Exhibit 4). Low income energy stocks are, in our view, already pricing in an oil correction. Industrials Last month, we removed our position in Canadian Pacific Railway Ltd. (CP-T, $66), given its relatively high exposure to bulk commodities, while maintaining our position in Canadian National Railway Co. (CNR-T, $78, portfolio weight 5.5%). In what we believe will be a slow economic recovery, rails are likely to perform better than the more cyclical sectors. CNR also gives us excellent exposure to a potential U.S. recovery. Consumers Defensive consumer stocks have rallied, we believe, as a result of rising market risks. However, in Canada, the premium paid for this defensive exposure appears to be coming at too high a cost. We may consider buying U.S. consumer staples. Consumer discretionary is another sector that we are also looking to add to. Information Technology, Telecommunication Services Technology remains one of our preferred sectors in the U.S., as we still see very strong earnings momentum. It continues to offer positive earnings momentum, and is also one of the more undervalued sectors, in our view. In a market where earnings growth may be increasingly difficult to find, technology should hold up, relative to other, more cyclical sectors.

12

Financials, Utilities We recently raised the banks to slight overweight and have very little life insurance exposure. Following better than expected Q4 results in what is traditionally a weak quarter, we added to the Canadian Banks. Given the relative strength of U.S. regional banks, we would prefer Canadian banks with U.S. exposure, such as Bank of Montreal (BMO-T, $50, portfolio weight 3%). We continue to favour the REITs, through RioCan REIT (REI.UN-T, $26, portfolio weight 3%). We believe that REITs are less economically sensitive than most financials, and should benefit more in a low interest rate environment.
Quantitative Model Portfolio Revisions in December 2011
Large Cap Stocks Added/Increased Astral Media Inc. (1.0%) Bank of Montreal (3.0% from 2.0%)

Stocks Removed/Decreased Goldcorp Inc. (4.0% from 6.0%) Canadian Pacific Railway Ltd. Canadian Oil Sands Ltd. (1.5% from 2.5%) Bonavista Energy Corp. (1.0% from 2.0%)

For complete details of our Canadian Earnings Momentum Model please visit our website at www.tdsecurities.com.

13

Exhibit 1.

45

S&P 500 Trailing Operating P/E S&P 500 Trailing Earnings Momentum (Yr/Yr%)
We believe that we have seen the peak of the earnings momentum cycle. Estimate revision momentum (i.e., rate of change) also turned negative following Q3 earnings. We believe that we could see year-over-year trailing earnings growth turn negative in late 2012. At that point, the market will likely discount an earnings recovery, and multiples could expand. Until such time, large cap, non-cyclical growth stocks will likely continue to outperform.

60

40

50

35

40

30

30

25

20

20

10

15

13x
10 -10

9x
5

11x
-20

6x

7x Multiples compress when the earnings cycle peaks.

0 1945

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

2010

-30 2015

Exhibit 2.

18000

TSX Composite Shenzhen Stock Index GS Commodity Index

We believe that the recent weakness in the Chinese stock market, and, in turn, the Chinese economy, is a major risk for commodities and the S&P/TSX. The Chinese market has consistently led both indices in recent years. To overweight commodities again, we need to see a recovery in China first.

18000

16000

16000

14000

14000

Commodities
12000

TSX

12000

10000

10000

8000

China

8000

6000

6000

4000

2007

2008

2009

2010

2011

2012

4000

14

Exhibit 3.

0.18

WTI Oil Relative to GS Commodity Index

Another risk is the high price of oil relative to other commodities. Relatively high oil prices compress the nonenergy related resources and manufacturers' margins.

0.18

0.16

0.16

Conversely, a large drop in oil would raise margins.

0.14

0.14

0.12

0.12

0.10

0.10

0.08

0.08

0.06

0.06

0.04

0.04

0.02

1970

1975

1980

1985

1990

1995

2000

2005

2010

0.02

Exhibit 4.
TCW Relative to TRP - Close TCW Relative to TRP - 12Month Forward Consensus EPS
The quest for yield has created some major distortions in relative value and earnings momentum. This has become most evident in the energy sector. As an example, the gap between the relative price of TCW/TRP and forward earnings is extreme, in our view. TRP trades at 18x forward earnings with declining estimates, while TCW trades at 7x with rising estimates.

1.2

1.2

1.0

1.0

0.8

0.8

0.6

0.6

0.4

0.4

0.2

0.2

0.0

2003

2004

2005

2006

2007

2008

2009

2010

2011

0.0

15

Exhibit 5.

1.35

USD Trade Weighted Index Gold - Closest Contract

The rotation into "safe haven" U.S. dollars and treasuries has had a negative impact on gold prices. If the U.S. recovery falters and/or the market becomes concerned again with U.S. debt levels, we could see a significant rotation back to gold in the new year.

2000

1.30

1800

1.25

1600

1.20

1400

1.15

1200

1.10

1000

1.05

800

1.00

Q1

Q2 2008

Q3

Q4

Q1

Q2 2009

Q3

Q4

Q1

Q2 2010

Q3

Q4

Q1

Q2 2011

Q3

Q4

Q1

600

Exhibit 6.

22

TSX Banks - Average 12 Month Forward P/E TSX Pipelines - Average 12Month Forward P/E TSX Utilities - Average 12month Forward P/E
The spread in forward P/Es between pipelines and utilities versus banks is at the same level as it was during the 2008 financial crisis.

22

20

20

18

18

16

16

14

14

12

12

10

10

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

16

Quantitative Model Portfolio: LargeCap (December 30, 2011)

Quantitative Model Portfolio: LargeCap
Company Name Symbol Yield Date Added Average Price Current Price S&P/TSX Current Weight Comp Weight Rel. to S&P/TSX Comp Percent Return from Date Added

Energy
Suncor Energy Enbridge Cenovus Energy Trican Well Service Vermilion Energy Canadian Oil Sands Bonavista Energy SU ENB CVE TCW VET COS BNP 1.50% 2.97% 2.37% 0.57% 5.03% 5.16% 5.52% 12/03/2010 04/20/2009 10/11/2011 08/12/2010 09/16/2011 03/08/2011 06/14/2011 $35.54 $18.36 $34.01 $17.39 $44.08 $32.33 $28.48 $29.38 $38.09 $33.83 $17.55 $45.37 $23.25 $26.07

27.2%
3.2% 2.1% 1.8% 0.2% 0.3% 0.8% 0.3%

19.7%
5.7% 5.2% 2.9% 1.9% 1.5% 1.5% 1.0%

0.7x
1.7x 2.5x 1.6x 10.4x 4.9x 2.0x 3.8x

56.89%
-17.33% 107.46% -0.53% 0.90% 2.93% -28.09% -8.46%

Materials
Barrick Gold Goldcorp Franco-Nevada Agrium Potash Corp. First Quantum ABX G FNV AGU POT FM 1.33% 1.22% 1.26% 0.67% 0.68% 0.87% 07/25/2007 05/16/2011 08/08/2011 07/22/2011 09/28/2009 10/31/2011 $41.49 $46.73 $40.46 $83.73 $43.41 $21.23 $46.15 $45.21 $38.78 $68.38 $42.11 $20.05

21.1%
3.3% 2.5% 0.4% 0.8% 2.6% 0.7%

16.0%
4.4% 3.4% 2.9% 2.6% 1.7% 0.9%

0.8x
1.4x 1.3x 7.6x 3.4x 0.7x 1.5x

-23.03%
11.24% -3.25% -4.14% -18.33% -2.99% -5.56%

Industrials
Canadian National Railway SNC Lavalin CNR SNC 1.62% 1.64% 12/01/2008 02/09/2011 $51.77 $61.89 $80.15 $51.08

5.7%
2.5% 0.5%

6.9%
5.4% 1.4%

1.2x
2.2x 2.7x

37.34%
54.81% -17.47%

Consumer Discretionary
Shaw Communications Magna International Thomson Reuters Astral Media SJR.B MG TRI ACM.A 4.54% 3.00% 4.65% 2.82% 08/11/2011 11/05/2009 10/11/2011 12/20/2011 $20.86 $32.51 $29.32 $36.01 $20.25 $34.00 $27.23 $35.49

4.0%
0.5% 0.6% 0.7% 0.1%

6.6%
2.8% 1.5% 1.3% 0.9%

1.6x
5.5x 2.7x 1.9x 7.1x

-6.91%
-2.92% 4.58% -7.13% -1.44%

Consumer Staples
Loblaw L 2.18% 09/13/2011 $34.99 $38.48

2.8%
0.3%

1.1%
1.1%

0.4x
4.0x

9.97%
9.97%

Health Care
Valeant VRX 0.00% 11/15/2011 $44.26 $47.66

1.4%
1.0%

1.6%
1.6%

1.2x
1.6x

7.68%
7.68%

Financials
Royal Bank of Canada CIBC Bank of Nova Scotia RioCan REIT Bank of Montreal Manulife Financial Information Technology Technology Select SPDR CGI Group RY CM BNS REI.UN BMO MFC 4.16% 4.88% 4.09% 5.22% 5.01% 4.79% 02/24/2011 10/27/2008 12/09/2003 10/13/2010 12/02/2011 10/11/2011 $56.26 $58.00 $34.75 $22.87 $57.75 $12.35 $51.98 $73.79 $50.83 $26.43 $55.88 $10.85

29.3%
5.2% 2.1% 3.9% 0.5% 2.5% 1.4%

24.3%
6.4% 5.5% 4.9% 3.2% 3.0% 1.3%

0.8x
1.2x 2.6x 1.3x 6.3x 1.2x 1.0x

66.12%
-7.61% 27.23% 46.29% 15.57% -3.24% -12.12%

1.3%
XLK GIB.A 1.41% 0.00% 02/08/2010 02/08/2011 $23.92 $20.61 $25.99 $19.20 NA 0.3%

7.9%
6.0% 2.0%

6.2x
NA 6.4x

1.80%
8.65% -6.85%

Telecommunication Services
TELUS Manitoba Telecom T MBT 4.03% 5.73% 06/14/2010 04/05/2011 $39.49 $30.18 $57.64 $29.67

5.2%
1.3% 0.1%

5.0%
2.8% 2.2%

1.0x
2.1x 15.9x

41.16%
45.95% -1.68%

Utilities
TransAlta TA 5.52% 04/29/2011 $21.35 $21.02

2.0%
0.3%

2.8%
2.8%

1.4x
8.6x

-1.56%
-1.56%

Cash Totals: Equity Totals: Performance

8.1% 91.9%

Portfolio Yield:

2.69%

1-Week

4-Week

3-Month

6-Month

1-Year

Year-to-Date (2011)

Since Inception (9/12/2000)

Quantitative Portfolio S&P/TSX Comp Cap (10%) S&P/TSX 60 Cap (10%) S&P/TSX Completion S&P/TSX SmallCap S&P 500 NASDAQ Comp Dow Jones Industrial Ave.

% % % % % % % %

0.322% 0.238% 0.401% -0.209% -0.109% -0.611% -0.515% -0.622%

-0.471% -0.994% -0.812% -1.486% -2.004% 1.070% -0.829% 1.648%

2.907% 2.850% 2.069% 5.066% 5.185% 11.152% 7.856% 11.951%

-6.948% -10.118% -10.869% -8.067% -13.754% -6.126% -7.489% -2.902%

-11.464% -11.070% -11.420% -10.256% -18.389% -0.003% -1.799% 5.528% Turnover:

78.9%

-11.464% -11.070% -11.420% -10.256% -18.389% -0.003% -1.799% 5.528% CAGR:

128.558% 31.712% 41.018% 28.348% 23.218% -15.141% -32.325% 8.763% 7.592%

All views expressed are the opinions of Quantitative Research based on historical company fundamentals and market statistics. No guarantee of outcome is implied. Due to the quantitative and technical nature of this report, the issuers or securities recommended or discussed in the report are not continuously followed and opinions may change without notice. TDSI is under no obligation to inform you of such a change. As such, investors may not want to base their investment decision solely on this report. TD Securities Inc. may publish fundamental research on the securities of these issuers which expresses differing opinions. Clients should contact their TD Securities Inc. representative to request such material. Sources: Global Insight, Thomson Financial, CPMS, Bloomberg, S&P/TSX Index Services, S&P Index Services, TSX, NYSE, NASD, company reports.

17

Alternative Energy
170 150 130 110 90 70 Oct08 Oct09 Oct10 Apr09 Apr10 Apr11 Oct11 Jul09 Jul10 Jan09 Jan10 Jan11 Jul11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. 0.0 0.9 (1.7) 3M 0.0 (1.4) 3.6 6M 0.0 6.8 (8.9) 12M 0.0 10.5 (8.7) YTD 0.0 10.5 (8.7) Cum .1 0.0 22.2 34.3

* S&P/TSX Independent Power Producers & Energy Traders (Subindustry) Since October 21, 2008

Action List

Comp Group*

S&P/TSX

Sean Steuart, CFA 416 308 3399 sean.steuart@tdsecurities.com

Industry Overview
Performance Summary for the Month Stocks of senior operators in the Canadian renewable energy sector, which make up our coverage universe, generally outperformed both broader equity markets and riskier renewable energy equities (prospective developers, smaller-scale operators and technology-focused companies) in December. Companies in the senior operators group are generally larger-cap, lower-risk, renewable energy power producers with stable dividends; on average, the senior operators share prices were flat on the month. Junior operators share prices were down 6.9% in December. The shares of prospective developers fell by 6.2%, while technology-focused stocks fell by 2.1%. The WilderHill New Energy Global Innovation Index (a global renewable energy composite, abbreviated NEX) declined by 6.8% in December. These moves compare with the S&P/TSX Composite Indexs return of -1.7% and the S&P/TSX Clean Technology Indexs return of 2.3%. Within our coverage universe, Brookfield Renewable Energy Partners L.P. was the best performing stock, gaining 7.4% in December. Capstone Infrastructure Corp. posted the largest decline, falling 35.9% during the month, after revising its 2012 guidance and announcing that it expected to cut its dividend in 2012. Things to Watch For in the Coming Month The comment period for the review of the Ontario feed-in tariff (FIT) program concluded on December 14, with the government receiving over 2,900 responses to the review (it was launched on October 31). The government previously suggested that the results of the review will likely be available in the first half of 2012. The OPA has indicated that, similar to the original FIT rules, the results of the review could be accompanied with a brief comment period for draft changes in the program. The review is focused on issues that include a likely reduction in FIT rates, ensuring the long-term sustainability of clean energy procurement, clean energy job creation, the consideration of new technologies, and local consultation regulations.

18

We believe that the government could use this opportunity to conduct a broader review of electricity policy particularly in the context of a new Minister of Energy, a minority government, and rising ratepayer costs. We believe that the review could result in a shift to an RFP-style procurement process for large-scale renewable projects, while leaving the FIT in place for small scale projects. The FIT is likely to see price reductions, particularly for solar projects, given the significant decline in solar panel prices since FIT prices were set over two years ago. It is also worth noting that the Commission on the Reform of Ontarios Public Services (led by Don Drummond, previously TD Banks Chief Economist) is widely expected to release its report before Ontarios March budget; this commission could recommend changes to the FIT, or to Ontarios energy sector (such as a restructuring of the OPA) that could further affect either the review process or the FIT program itself. Companies in our coverage universe are expected to start reporting Q4/11 results in February. The timing of Q4 results tends to vary widely among these companies; Brookfield Renewable is normally the first to report in early February, while some companies report well toward the end of March. Our Sector Stance We recommend that investors take a market weight sector position. We consider the sector to be fairly valued at current levels; however, we see an opportunity for outperformance in select cases, particularly in light of recent market volatility. Within the sector, we prefer Algonquin Power & Utilities Corp., Innergex Renewable Energy Inc., and Boralex Inc. Our top pick in the sector is Algonquin Power, which we consider to be a rare combination of 1) a conservative mid-term payout ratio (implying an ability to fund a portion of growth from internal cash reserves and residual operating cash flow) and 2) relatively inexpensive valuation based on forward earnings expectations.

19

20
Curr. Symbol AQN INE BLX BEP.UN ATP, AT CSE NPI 17.0x 16.2x 17.4x 13.1x 14.1x 13.3x T $17.93 Dec C$ 126.0 $2,259 $1.08 6.0% 152.3 $931 $3,336 20.3x 22.6x 37.9x 16.5x 20.4x 21.1x $16.00 T $3.81 Dec C$ 74.0 $282 $0.50 13.1% 72.1 $645 $1,000 5.6x 7.5x 7.7x 10.8x 9.2x 9.4x $4.00 T, N $14.30 Dec US$ 123.1 $1,760 $1.14 7.9% 166.4 $1,375 $3,517 13.6x 13.1x 12.9x 12.9x 12.2x 11.1x $14.50 9% 18% -5% T $27.16 Dec US$ 265.2 $7,203 $1.35 5.0% 248.7 $5,414 $12,867 30.3x 20.1x 15.1x 14.1x 18.1x 12.9x $26.00 1% T $7.13 Dec C$ 37.7 $269 $0.00 0.0% 108.8 $521 $799 NMF NMF NMF 9.5x 7.6x 8.0x $8.50 19% T $10.30 Dec C$ 81.3 $838 $0.58 5.6% 118.7 $994 $2,036 NMF NMF NMF 15.1x 17.6x 16.9x $11.00 12% T $6.42 Dec C$ 151.4 $972 $0.28 4.4% 109.4 $543 $1,554 15.2x 17.8x 13.3x 12.3x 13.4x 13.3x $7.00 13% BUY BUY BUY HOLD HOLD HOLD HOLD Exch. Price End Curr. O/S Cap (mm) Dist. Yield 2011E Debt EV 2010A 2011E 2012E 2010A 2011E 2012E Target Return Rating Year- Rep. Shares Market Ind. EBITDA Net P/E 12-Month Total EV/EBITDA Overall Risk Rating MED MED MED LOW MED MED MED Analyst SS SS SS SS SS SS SS

Alternative Energy Universe

Algonquin Power & Utilities Corp. (1)

Innergex Renewable Energy Inc.

Boralex Inc.

Brookfield Renewable Energy Partners L.P. (1)

Atlantic Power Corp. (1, 2)

Capstone Infrastructure Corp. (1)

Northland Power Inc. (1)

Average

Notes:

(1) P/AFFO (adjusted funds from operations per unit) substituted for P/E

(2) Share price, market cap, dividend, EV & 12-month target in C$

AL BUY = Action List BUY Analyst(s): SS = Sean Steuart, CFA 416 308 3399

Banks
140 120 100 80 60 40 Oct07 Oct08 Oct09 Oct10 Jun08 Jun09 Jun10 Feb08 Feb09 Feb10 Feb11 Jun11 Oct11 Total Return % 1M Action List Comp. Group* S&P/TSX Comp. Since October 11, 2007 2.4 3.1 (1.7) 3M 1.8 2.5 3.6 6M 1.9 (5.7) (8.9) 12M 1.9 1.1 (8.7) YTD 1.9 1.1 (8.7) Cum.1 21.5 13.1 (5.0)

* S&P/TSX Commercial Banks (Industry)

Action List

Comp Group*

S&P/TSX

Jason Bilodeau, CFA 416 308 3741 jason.bilodeau@tdsecurities.com

Industry Overview
Performance Summary for the Month On average, the S&P/TSX Commercial Banks (Industry) was up 3.1% on the month, outperforming the S&P/TSX Composite Index, which was down 1.7%. U.S. banks (based on our list), including U.S. Money Center and Super Regional banks, outperformed their Canadian counterparts, and were up an average of 3.2% month over month. Things to Watch For in the Coming Month The U.S. banks are set to begin reporting Q4/11 results at the end of next week. The U.S. banks results will affect Canadian banks like BMO, which have significant U.S. retail exposure. (Royal Bank has largely sold its U.S. Retail operations, which should close on March 2012.) The operating environment remains under pressure, and retail operating trends should continue to moderate, with some weak spots in evidence in PCL trends. U.S. earnings will likely continue to see a focus around investment banking/trading revenues (which will likely be under pressure) and the impact of regulatory issues (including capital). The Canadian banks recently completed its Q4/11 reporting results last month. In the end, the quarter was largely better than feared. Most earnings beat estimates and underlying trends were generally good, while Wholesale results largely beat lowered expectations. The slower revenue picture continues to evolve on the back of continued moderation in volume growth (but holding in better than expected), while margins were slightly lower than expected. Credit performance was a bit mixed during Q4/11, but generally trends are levelling off. Further, given the softer revenue environment, all of the banks have begun to highlight efforts to manage expense growth, and that should remain a key focus in 2012.

21

Our Sector Stance Overall, we remain comfortable that the group can post reasonable earnings growth in 2012, and, to us, the stocks are more than 15% undervalued here. We believe that the core business trends remain reasonable, although somewhat modest by historical standards. Further, we see significant upside in the earnings potential, should markets recover and interest rates move higher for H2/12-2013. Both scenarios have good chances, in our view. It is on this basis that we remain fairly constructive on the group. We believe near-term earnings pressure will be manageable, and earnings (and dividends) should continue to grow further in 2012. With the stocks currently trading at what we view as reasonably attractive valuations, we see total returns on the order of 30% over the coming 12 to 16 months.

Canadian Imperial Bank of Commerce

(CM-T, N; $73.79); 12 Month Target $94.00 Jason Bilodeau, CFA 416 308 3741 We upgraded CIBC to an Action List BUY on July 25 (for detail, see our Action Note of that date) on the view that the shares were aggressively discounting what we thought to be a very reasonable operating outlook. The strong Q3/11 and Q4/11 results supported that view, and we remain comfortable with our above-Consensus view on earnings. We continue to believe that the shares offer very good value at current levels. The bank has largely de-risked its Wholesale operations and is a Retail focused business (with upside potential in 2012 from its addition of American Century). CIBC remains well capitalized and we see further dividend increases in 2012. Ultimately, CIBC does not, in our view, have the highest quality medium-term growth prospects in the group, but earnings have been coming on well, and the stock is trading at what we view as still attractive valuations (including a 4.9% dividend yield). We reiterate our Action List BUY.

22

Banks Universe
Overall Curr. Price $73.79 $50.83 $51.98 $47.83 $25.80 $55.88 $72.14 $76.29 Oct C$ 893.8 $68,188 $2.72 Oct C$ 160.4 $11,571 $3.00 4.2% $6.25 $7.01 $7.35 10.3x 9.8x $81.00 Oct C$ 639.0 $35,707 $2.80 5.0% $4.81 $5.29 $5.72 10.6x 9.8x $67.00 Oct C$ 75.4 $1,945 $0.60 2.3% $1.99 $2.18 $2.30 11.8x 11.2x $33.00 30.2% 24.9% 16.4% Oct C$ 23.9 $1,144 $1.80 3.8% $4.55 $5.11 $5.30 9.4x 9.0x $56.00 20.8% Oct C$ 1438.3 $74,763 $2.16 4.2% $3.98 $4.46 $4.65 11.7x 11.2x $62.00 23.4% Oct C$ 1086.0 $55,201 $2.08 4.1% $3.92 $4.39 $4.80 11.6x 10.6x $68.00 37.9% BUY BUY BUY HOLD HOLD HOLD Oct C$ 399.1 $29,450 $3.60 4.9% $6.45 $7.47 $7.90 9.9x 9.3x $94.00 32.3% AL BUY End Curr. O/S (mm) Cap (mm) Div. Yield 2010 2011 2012E 2011 2012E Target Return Rating Year Rep. Shares Market Ind. Ind. EPS P/E 12-Month Total Risk Rating LOW LOW LOW LOW MEDIUM LOW LOW Analyst JB JB JB JB JB JB JB JB

Canadian Imperial Bank of Commerce

Bank of Nova Scotia

Royal Bank of Canada

Laurentian Bank

Canadian Western Bank

Bank of Montreal

National Bank

Toronto-Dominion Bank

-------------------------------------------------------------------- Restricted -----------------------------------------------------------------------------

Financial Services Insurance Universe

Overall Year End $20.50 Dec C$ 98.6 $2,021 $1.04 5.1% $2.96 $3.12 $3.25 Curr. O/S (mm) Cap (mm) Div. Yield 2010 2011E 2012E Rep. Shares Market Ind. Ind. EPS 2011E 6.6x P/E 2012E 6.3x 12-Month Target $34.00 Total Return 70.9% Rating BUY Risk Rating MEDIUM Analyst JB

Genworth MI Canada

AL BUY = Action List BUY Analyst(s): JB = Jason Bilodeau, CFA 416 308 3741

23

Biotechnology & Health Care

230 180 130 80 30 Jul05 Jul06 Jul07 Jul08 Jul09 Jul10 Jan06 Jan07 Jan08 Jan09 Jan10 Jan11 Jul11 Action List Com p. Group* S&P/TSX Com p. Since July 27, 2005 1M 0.0 (0.7) (1.7) 3M 0.0 14.9 3.6 Total Return % 6M 0.0 (3.8) (8.9) 12M 0.0 50.4 (8.7) YTD 0.0 50.4 (8.7) Cum .1 (38.0) 74.6 35.4

* S&P/TSX Health Care (Sector)

Action List

Comp Group*

S&P/TSX

Lennox Gibbs 416 308 2213 lennox.gibbs@tdsecurities.com

Industry Overview
Performance Summary for the Month The S&P/TSX Health Care sector declined by 0.7% in December. Paladin Labs (PLB-T) was our most notable outperformer in the month, gaining 8.4%, on continued demonstration of strong financial performance and operational execution (DigiFab launch December 12). Valeant Pharmaceuticals (VRX-T, VRX-N) was also topical, gaining 1.0%, on a flurry of business development activity. During the month, the company 1) closed four acquisitions Afexa Life Sciences, Ortho Dermatologics, Dermik and iNova; 2) initiated a $327 million hostile bid for ISTA Pharmaceuticals (ISTA-Q, not rated), a branded ophthalmic Specialty Pharma company; and 3) closed $500 million of incremental term loans. Things to Watch For in the Coming Month 1) Valeant 2012 guidance call January 6, 2012 2) Valeants expiration of ISTA bid January 31, 2012 3) CML MOH notification regarding termination of Year 2 performance-based funding 4) CML appointment of a permanent CEO Beyond the month, we expect: 1) Valeants U.S. Potiga launch Q1/12 2) For SXC, Cigna (CI-N, not rated) notification to CMS regarding PBM switch April 2012 3) Nordion versus AECL/Government of Canada resolution expected 2012 Our Sector Stance We are market weight the Canadian Biotechnology and Health Care sector. We favour companies that have 1) strong competitive positions in their respective businesses; 2) favourable pharmacoeconomic (and health care economic) profiles; 3) favourable reimbursement footings; and 4) little or no need for short-term borrowing.

24

Biotechnology & Health Care Universe

Overall Curr. EPS Yield 7.8% 4.9% 9.4% 4.8% $2.04 $2.80 $4.00 22.9x 16.7x 11.7x $1.03 $1.48 $2.29 54.8x 38.2x 24.7x $68.00 $60.00 ($0.03) ($0.13) $0.12 nmf nmf 10.7x $2.50 $1.54 $2.06 $1.49 27.1x 20.3x 28.0x $44.00 ($0.51) ($0.31) ($0.31) nmf nmf nmf $4.00 -20% 5% 95% 20% 29% ($2.60) $0.67 $0.96 nmf 12.5x 8.7x $10.50 30% ($0.05) ($0.45) $0.52 nmf nmf nmf $11.50 8% $1.11 $1.14 $1.44 20.0x 19.5x 15.4x $22.00 4% HOLD HOLD HOLD REDUCE HOLD BUY BUY BUY $0.35 $0.65 $0.75 27.6x 14.9x 12.9x $10.00 11% HOLD $0.12 $0.02 $0.22 16.5x 99.0x 9.0x $2.00 1% HOLD 2010A 2011E 2012E 2010A 2011E 2012E Target Return Rating P/E (x) Price $1.98 $9.66 $22.24 $11.65 $8.36 $5.00 $41.74 $1.28 $56.48 $46.69 Dec. US$ 298.1 $13,917 Dec. US$ 62.4 $3,522 Oct. US$ 128.9 $165 Dec. C$ 20.2 $843 Dec. US$ 32.8 $164 Oct. US$ 62.3 $521 $0.40 Dec. US$ 28.3 $330 $1.10 Dec. C$ 7.0 $156 $1.10 Dec. C$ 89.9 $868 $0.75 July C$ 66.7 $132 End Curr. O/S (mm) Cap (mm) Div. Year Rep. Shares Market Ind. 12-Month Total Risk Rating HIGH MEDIUM MEDIUM HIGH HIGH SPEC MEDIUM HIGH MEDIUM MEDIUM Analyst LG LG LG LG LG LG LG LG LG LG

Stock Name

Symbol

Cangene Corp.

CNJ

CML Healthcare

CLC

K-Bro Linen Inc.

KBL

Medical Facilities

DR.UN

Nordion Inc.

NDN, NDZ

Novadaq Technologies Inc.

NDQ

Paladin Labs

PLB

Patheon Inc.

PTI

SXC Health Solutions

SXC, SXCI

Valeant Pharmaceuticals Inc.

VRX, VRX

AL BUY = Action List BUY Analyst(s): LG = Lennox Gibbs, 416 308 2213

25

Chemicals & Fertilizers

300 250 200 150 100 50 0 Oct07 Oct08 Oct09 Oct10 Apr07 Apr08 Apr09 Apr10 Apr11 Oct11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. Since April 24, 2007 (4.2) (5.1) (1.7) 3M (4.2) (5.0) 3.6 6M (4.2) (22.1) (8.9) 12M (4.2) (19.3) (8.7) YTD (4.2) (19.3) (8.7) Cum .1 (43.7) 58.3 0.6

* S&P/TSX Chemicals (Industry)

Action List

Comp Group*

S&P/TSX

Paul DAmico, CFA 416 983 2755 paul.damico@tdsecurities.com

Industry Overview
Performance Summary for the Month Fertilizer producer stocks were weaker in December, likely due to weaker sentiment toward the sector, as production cuts have been announced. Specifically, Agrium (AGU-N, T) and Potash Corp. (POT-N, T) both decreased by 4% and 5%, respectively. Migao (MGO-T) increased by 31%, albeit from a very low stock price level at the end of November. We speculate that some reduced doubt about the longterm supply agreement with Potash Export Co. (PEC) and overall improved sentiment on the name may be the reasons for the bounce. Methanex (MEOH-Q, MX-T) decreased by 7%, likely reflecting global economic growth concerns. Fertilizer prices mostly lower in December. Urea and DAP prices were both down about 18% and 22%, respectively. Demand has been essentially non-existent, as buyers are cautious, due to macroeconomic concerns. However, inventories are estimated to be relatively low, and purchases for the spring planting season are still expected in early Q1/12. The domestic potash price dropped nominally by 1%. Meanwhile, methanol increased by 4%, but on light volume. Potash inventory update. The North American potash inventory increased by 24% sequentially in November to 1.375 million tons (K2O basis), and is 26% higher year over year. The inventory level is now 5% below the 2001-2010 average of 1.441 million tons for November. For context, North American potash production of 1.040 million short tons (K2O basis) in November 2011 is 17% higher sequentially, but 5% lower year over year. We attribute the sequential increase in inventory to continued buyer caution and seasonality. We expect the flow of product to improve domestically with spring demand, while offshore volumes are likely to be soft, until price clarity is gained from the China/India contract negotiations in February/March. Chinas methanol net imports strong. Chinas methanol net import data suggest demand has not waned. The most recent Chinese methanol net import data for November 2011 of 514,000 tonnes is 4% lower sequentially, but still 18% higher year over year. Year to date, net imports of 5.2 million tonnes are 11% higher year over year, which suggests strong demand growth.

26

Methanol price retraces slightly from high level. Methanexs North American non-discounted methanol reference price (NDRP) for January 2012 has been lowered to US$1.34/gal, which is 3% lower from the US$1.38/gal over August to December 2011. Similarly, its Asian Posted Contract Price (APCP) has been lowered to US$440/tonne for January 2012, from US$470/tonne. Despite the slight reduction, prices remain at relatively strong levels. Potash Corp. curtails production and expresses interest in increasing ICL stake. The company has announced a market-related production cutback, consistent with the company's practice of matching supply with demand. As well, Potash Corp. has also expressed interest in increasing its equity ownership in Israel Chemicals (ICL-TV; not rated) to 25.0% from 13.9%. We were not surprised by either event, and do not believe that they will have any notable impact. Our long-term fundamental view remains positive especially given the current attractive valuation. Our BUY rating is unchanged. Target lowered on Migao, BUY unchanged. We reduced our EPS estimates and target price to $7 from $8, due to weaker SOP pricing in China, as reported by CRU, a fertilizer industry publication. However, our BUY rating is unchanged, as we continue to see attractive value at current stock price levels. Things to Watch For in the Coming Month Investors should watch price movements in major crops (defined by acreage usage and fertilizer requirement intensity), such as corn and soybeans, as well as the major fertilizers ammonia, urea, DAP and potash. Methanol trade data is neither timely nor frequent; therefore, news flow is essentially anecdotal from trade publications. Our Sector Stance Our view on major crops is positive, given the low stocks-to-use ratio for corn, expected time lag to replenish stocks, strong overall farmer profitability, and continued global demand growth. Similarly, we recommend an overweight stance for the fertilizer sector, given 1) prevailing positive fundamentals supporting pricing, 2) healthy profit margins, 3) producer discipline, 4) relatively attractive stock price valuations, and 5) continued strong global demand/requirement of nutrients for crop yield improvement.

Agrium Inc.
(AGU-N, US$67.11); 12-Month Target: US$115.00 Paul DAmico, CFA 416 983 2755 In mid-December, Agrium announced that it will quadruple its dividend. We believe this provides several positives: 1) the current dividend yield of about 0.7% is now somewhat more competitive with peers; 2) demonstrates shareholder friendliness in answering requests for such an increase, sooner than we expected; and 3) implies management confidence in sustainable free cash flow strength, as, in our view, increased retail segment improves relative stability. Agrium is still in growth mode, and, in our view, this increased dividend does not impede its ability to maintain a strong balance sheet or implement its growth strategy, including acquisitions and expansion. We maintain our Action List BUY rating on Agrium.

27

28
Overall Curr. Symbol AGU POT MEOH, MX MGO FOS T $0.32 Jan C$ 172.6 $54 $0.00 0.0% nmf nmf nmf nmf nmf nmf $0.40 27% HOLD T $4.01 Mar C$ 52.7 $211 $0.00 0.0% $0.79 $0.65 $0.53 5.1x 6.2x 7.6x $7.00 75% BUY Q, T $22.82 Dec US$ 94.4 $2,154 $0.68 3.0% $1.09 $1.96 $2.67 20.9x 11.6x 8.5x $30.00 34% HOLD N, T $41.28 Dec US$ 877.0 $36,203 $0.28 0.7% $1.98 $3.60 $4.12 20.8x 11.5x 10.0x $66.00 61% BUY HIGH HIGH HIGH SPEC N, T $67.11 Dec US$ 158.0 $10,603 $0.45 0.7% $4.52 $9.58 $9.00 14.8x 7.0x 7.5x $115.00 72% AL BUY HIGH Exch. Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010 2011E 2012E 2010 2011E 2012E Target Return Rating Rating YearRep. Shares Market Ind. EPS P/E (x) 12-Month Total Risk LRQ Q3/11 Q3/11 Q3/11 FYQ2/12 FYQ2/12 Analyst PD PD PD PD PD

Chemicals and Fertilizers Universe

Stock Name

Agrium Inc.

Potash Corp.

Methanex Corp.

Migao Corp.

PhosCan Chemical Corp.

AL BUY = Action List BUY Analyst(s): PD = Paul DAmico, CFA 416 983 2755

Communications
2,500 2,000 1,500 1,000 500 0 Apr02 Apr03 Apr04 Apr05 Apr06 Apr07 Apr08 Apr09 Apr10 Apr11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. (1.2) 4.3 (1.7) 3M (4.0) 6.2 3.6 6M (11.5) 1.9 (8.9) 12M (2.0) 7.5 (8.7) YTD (2.0) 7.5 (8.7) Cum .1 1943.7 76.7 97.9

* S&P/TSX Div. Telecom. Services, Media (Industries), Commercial Printing (Subindustry) Since April 26, 2002

Action List

Comp Group*

S&P/TSX

Vince Valentini, CFA 416 944 7012 vince.valentini@tdsecurities.com

Industry Overview
Performance Summary for the Month Yet again this month, there was tremendous disparity of returns in our space. BCE and Quebecor were up over 6%, but Shaw, Cogeco Inc., Thomson Reuters and TeraGo finished in negative territory. Quebecors rise came on the back of a rough November, when the shares were down 6%. On an equal-weighted basis, the groups average return was slightly more than 1% positive. Things to Watch For in the Coming Month Shaw AGM and Q1 results January 12 Cogeco Cable Inc. and Cogeco Inc. AGM and Q1 results January 26 Our Sector Stance We maintain our underweight stance on the sector. In the wireless market, new entrants continued to relentlessly discount plans and handsets over the holiday season in an effort to attract new customers. The price promotion has not gone unnoticed by the incumbents, and they have been forced to react. Hesitant to compete directly on price, the incumbents have offered: 1) increased handset subsidies, and 2) free long distance. Bloomberg reported that an end to the price wars may be in sight in its report entitled Globalive said to be in talks to buy Rival Mobilicity, dated December 20. However, despite the ostensible immediate benefits, we believe the combination of WIND and Mobilicity could actually have negative implications for Rogers, BCE and TELUS. The transaction could lead to the emergence of one strong new entrant, with the capability to invest in better spectrum (700 MHz), better networks (LTE), and better devices (iPhone and its associated subsidy model). As a result, competitive disruption could also migrate up from the low end prepaid and talk & text segment, into the more lucrative smartphone segment.

29

Manitoba Telecom Services Inc.

(MBT-T, $29.67); 12-Month Target C$40.00 Vince Valentini, CFA 416 944 7012 We believe that the turnaround at Allstream remains intact. Pension fears have been overblown, and we are confident that management will be able to deliver on its guidance for either zero cash pension solvency funding or flat capex in 2012. Improving and undervalued fundamentals, which could lead to a dividend growth story by 2013, are the primary reason why we like MBT shares, but we note that potential changes in foreign ownership rules this fall could spark an M&A catalyst for the stock (see our research report of November 30, 2011), which, we believe, enhances the risk-reward profile.

Thomson Reuters Corp.

(TRI-T, $27.23); 12-Month Target C$43.00 Vince Valentini, CFA 416 944 7012 We doubt that TRI shares will break out to the upside in the near term if the economic news flow out of Europe remains volatile. However, we remain convinced of its long-term upside, and view the stock as heavily oversold and undervalued. A dividend increase with the Q4 results in February, combined with confirmation that the lengthy integration of Reuters is finally complete, should reverse sentiment on the stock.

30

Communications Universe
Overall Curr. Exch. T T, N T T, N T,N T,N T T T, N T T $28.59 Dec C$ 228.7 $6,540 $1.90 6.6% n.a. $1.73 $1.75 $2.32 $2.30 $2.26 16.5x 12.4x $48.39 Aug C$ 16.7 $810 $0.72 1.5% $2.78 $3.81 $4.89 n/a n/a n/a n/a n/a $42.47 Dec C$ 761.2 $32,328 $2.07 4.9% $2.79 $3.14 $3.23 $1.89 $2.93 $3.07 13.5x 14.5x $51.35 Aug C$ 49.3 $2,531 $1.00 1.9% $2.62 $3.65 $4.78 $3.60 $2.13 $2.33 14.1x 24.1x $10.39 Dec C$ 12.4 $129 $0.00 0.0% ($0.51) ($0.05) $0.24 n/a n/a n/a Neg. Neg. $11.00 $53.00 $38.00 $48.00 $25.00 $39.25 Dec C$ 592.4 $23,252 $1.42 3.6% $2.89 $3.14 $3.32 $3.44 $3.61 $3.11 12.5x 10.9x $39.00 $54.64 Dec C$ 322.0 $17,594 $2.32 4.2% $3.27 $3.88 $4.12 $2.71 $3.27 $4.47 14.1x 16.7x $58.00 3% 6% 5% -6% 1% -6% $20.25 Aug C$ 433.1 $8,771 $0.92 4.5% $1.42 $1.66 $1.63 $1.02 $1.48 $1.25 12.2x 13.7x $24.00 23% 10% $34.89 Dec C$ 64.3 $2,243 $0.20 0.6% $3.42 $3.13 $3.58 $0.90 $0.97 $2.00 11.1x 36.1x $44.00 27% $27.23 Dec US$ 837.7 $22,812 $1.24 4.6% $1.56 $2.01 $2.49 $1.87 $2.23 $2.59 13.6x 12.2x $43.00 62% BUY BUY HOLD HOLD HOLD HOLD HOLD HOLD $29.67 Dec C$ 67.7 $2,009 $1.70 5.7% $2.18 $2.63 $2.81 $1.39 $2.04 $2.62 11.3x 14.6x $40.00 41% ALBUY ALBUY Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011E 2012E 2010A 2011E 2012E P/E (x) P/FCF (x) Target Return Rating YearRep. Shares Market Ind. EPS Curr. Curr. 12-Month Total CFPS Risk Rating MEDIUM LOW HIGH MEDIUM MEDIUM MEDIUM HIGH HIGH MEDIUM HIGH REDUCE MEDIUM Analyst VV VV VV VV VV VV VV VV VV VV VV

Stock Name

Symbol

Manitoba Telecom Services Inc.

MBT

Thomson Reuters Corp. (1)

TRI

Quebecor Inc.

QBR.B

Shaw Communications Inc. (2)

SJR.B, SJR

TELUS Corp.

T.A, TU

Rogers Communications Inc.

RCI.B, RCI

TeraGo Inc.

TGO

Cogeco Cable Inc.

(2)

CCA

BCE Inc.

BCE

Cogeco Inc.(2)

CGO

Bell Aliant Inc.

BA

Notes: (1) Earnings for Thomson Reuters Corp. are in U.S. dollars but share price and market cap are in Canadian dollars. (2)Cash Flow and earnings for 2011 reflect actual (Aug. 31 Fiscal YE)

AL BUY = Action List BUY Analyst(s): VV = Vince Valentini, CFA 416 944 7012

31

Consumer Discretionary
120 90 60 30 Dec08 Dec09 Dec10 Aug08 Aug09 Aug10 Aug11 Dec11 Apr08 Apr09 Apr10 Apr11 Action List Com p. Group* S&P/TSX Com p. Since April 1, 2008 1M 0.0 (0.6) (1.7) 3M 0.0 3.1 3.6 Total Return % 6M 0.0 (6.2) (8.9) 12M 22.0 (6.0) (8.7) YTD 22.0 (6.0) (8.7) Cum .1 (47.6) (8.7) (0.7)

* S&P/TSX Durables & Apparel, Retailing (Industry Groups)

Action List

Comp Group*

S&P/TSX

Jessy Hayem, CFA 514 289 0385 jessy.hayem@tdsecurities.com

Industry Overview
Performance Summary for the Month Over the past month, the comparable group of discretionary stocks declined by 0.6%, outperforming the S&P/TSX Composite Index, which declined by 1.7%. Our consumer discretionary stocks under coverage recorded a weighted average decline of 1.0%. Things to Watch For in the Coming Month January 26: Richelieu Hardware (RCH-T) Q4/11 results. We are looking for EPS of C$0.51 versus C$0.48 and consensus of C$0.51. Our Sector Stance Looking into 2012, our long-term outlook for the consumer discretionary space remains generally positive, and we recommend an overweight stance. Admittedly, recent market uncertainty has certainly affected sentiment on our sector, which has been hit harder than sectors with more defensive characteristics. We agree with our colleague, TD Securities Investment Strategist John Aitkens, who still believes that equity markets are oversold, valuations are inexpensive, and that a recession will be avoided. His recommendation remains to overweight higher beta sectors, including consumer discretionary. We share his opinion, as indicated by the fact that we have BUY recommendations on most of the stocks that we cover. As the uncertainties of recent events pass, a move into consumer discretionary stocks is likely, especially with corporate earnings growth re-accelerating into 2012, leading to valuation recovery. In our view, during H1/12, uncertainty surrounding the financial situation in Europe will likely negatively affect growth, confidence and spending in both the U.S. and Canada. The outcome of the crisis in Europe admittedly represents a major downside risk to economic growth in North America. Most companies under our coverage generate a significant portion of their business in the U.S., with the exception of Canadian Tire, RONA and Dollarama. The economy had been on a slow recovery pace before the U.S. debt ceiling debate, euro zone debt woes, and the financial market fallout jolted consumer and business

32

confidence in the economy. Consumer confidence bounced back strongly in November, after sinking to its lowest level since March 2009. However, confidence remains well below historical levels and job growth is likely to remain subdued. While the economy is likely to continue to grow in 2012, tepid income growth and pending headwinds from Europe could lead to slower spending in H1/12. We anticipate that after slowing in H1/12, and as confidence recovers, consumer spending should re-accelerate in H2. In Canada, consumer spending may have been fuelled by increased discounting at retail in Q4. However, a soft labour market, slow wage growth, growing household debt, combined with rising gasoline and food prices, suggest that looking into 2012, low interest rates may not represent the same catalyst for spending as it did in 2010. These factors, combined with the recent volatility in the financial markets and uncertainty surrounding the global economy, lead us to expect soft retail spending into H1/12. In our view, 1) if economic conditions weaken or remain uncertain, stocks in our coverage universe that may best weather the storm are Dollarama and Canadian Tire, and among the small caps, Uni-Select; or 2) in a soft landing scenario, our top pick coming out of the current slump would be Gildan Activewear, which has a solid long-term strategy for growth, and Atrium and Dorel in the small cap space. Garda World also has the potential to recover meaningfully, though we maintain a HIGH risk rating on this stock. In the consumer discretionary space, we continue to favour stocks that have: 1) room to grow earnings through operational improvements over and above the potential lift from an eventual market recovery; 2) strong balance sheets, and significant free cash flows that can be redeployed in value-added opportunities such as acquisitions and/or share buybacks and dividend introductions/increases; and 3) valuations close to historical lows.

33

34
Overall Curr. Symbol CTC.A DOL DII.B GIL RON T $9.74 Dec C$ 131.1 $1,277 $0.14 1.4% $1.04 $0.66 $0.82 $335 $272 $308 14.8x 11.9x 5.8x 5.1x $11.00 T,N $19.16 Sep US$ 122.1 $2,339 $0.30 1.6% $1.65 $1.35 $2.22 $279 $312 $264 13.9x 8.5x 7.9x 9.3x $25.00 32% 14% T $25.55 Dec US$ 32.6 $833 $0.60 2.3% $3.47 $2.92 $3.59 $212 $177 $210 8.6x 7.0x 6.4x 5.4x $32.00 28% T $44.50 Jan C$ 75.5 $3,360 $0.36 0.8% $1.64 $2.15 $2.50 $234 $282 $321 20.7x 17.8x 12.8x 11.3x $44.00 0% T $65.90 Dec C$ 81.7 $5,384 $1.20 1.8% $4.77 $5.40 $6.03 $1,014 $1,061 $1,251 12.2x 10.9x 9.1x 7.8x $69.00 7% BUY HOLD BUY BUY HOLD Exch. Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011E 2012E 2010A 2011E 2012E 2011E 2012E 2011E 2012E Target Return Rating YearRep. Shares Market Ind. EPS EBITDA (mm) P/E (x) EV/EBITDA (x) 12-Month Total Risk Rating MEDIUM MEDIUM MEDIUM HIGH MEDIUM Analyst JH JH JH JH JH

Consumer Discretionary Universe

Stock Name

Canadian Tire Corporation Ltd. (1)

Dollarama Inc.

Dorel Industries Inc. (1)

Gildan Activewear Inc.

RONA Inc. (1)

Special Situations Universe

Overall Curr. Symbol ATB GW RCH UNS T $26.25 Dec US$ 22.9 $601 $0.48 1.8% $2.33 $2.78 $3.02 $78 $111 $125 9.2x T $28.71 Nov C$ 21.1 $606 $0.44 1.5% $1.78 $1.84 $1.93 $64 $67 $69 15.6x 14.9x 8.5x T $7.31 Jan C$ 32.3 $236 $0.00 0.0% $0.90 $0.85 $1.05 $126 $132 $146 8.6x 7.0x T $11.88 Dec US$ 33.0 $392 $0.00 0.0% $1.44 $1.74 $1.86 $84 $96 $105 6.7x 6.3x Exch. Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011E 2012E 2010A 2011E 2012E 2011E 2012E 2011E 6.0x 6.3x 9.0x 8.3x YearRep. Shares Market Ind. EPS EBITDA (mm) P/E (x) EV/EBITDA (x) 2012E 5.4x 5.7x 8.7x 7.4x 12-Month Target $17.50 $13.00 $29.00 $32.00 Total Return 47% 78% 3% 24% Rating BUY BUY HOLD BUY Risk Rating MEDIUM HIGH MEDIUM MEDIUM Analyst JH JH JH JH

Stock Name

Atrium Innovations Inc. (1)

Garda World Security Corp. (1), (2)

Richelieu Hardware Ltd.

Uni-Slect Inc. (1)

(1) Financial figures for 2010A were adjusted per TD calculations to reflect changes made related to IFRS.

(2) Financial figures depict fiscal year closest to calendar year end.

Note: Curr. Price, Market Cap, and Ind. Div. for DII.B, GIL, and ATB are in C$.

AL BUY = Action List BUY Analyst(s): JH = Jessy Hayem, CFA 514 289 0385

Consumer Staples
180 140 100 60 Jul05 Jul06 Jul07 Jul08 Jul09 Jul10 Jan06 Jan07 Jan08 Jan09 Jan10 Jan11 Jul11 Action List Com p. Group* S&P/TSX Com p. Since July 21, 2005 1M 6.4 1.9 (1.7) 3M 3.2 2.9 3.6 Total Return % 6M 6.9 2.0 (8.9) 12M 9.1 6.8 (8.7) YTD 9.1 6.8 (8.7) Cum .1 23.2 9.6 37.9

* S&P/TSX Consumer Staples (Sector)

Action List

Comp Group*

S&P/TSX

Michael Van Aelst, CFA 514 289 0518 michael.vanaelst@tdsecurities.com Cherilyn Radbourne, CA, CFA 416 308 3403 cherilyn.radbourne@tdsecurities.com Derek J. Lessard 514 289 0384 derek.lessard@tdsecurities.com

Industry Overview
Performance Summary for the Month Over the past month, the S&P/TSX Consumer Staples Index grew by 1.9%, while the S&P/TSX Composite Index declined by 1.7%. With an average return of 1.5%, our consumer staples stocks under coverage outperformed the S&P/TSX Composite Index, but underperformed the Consumer Staples index. Things to Watch For in the Coming Month January 6: The Jean Coutu Group (PJC) Inc. (PJC.A-T) fiscal Q3/12 results. We are looking for EPS (f.d.) of $0.22 versus $0.21 a year ago. Consensus is also at $0.22 (range of $0.220.23). January 18: Viterra Inc. (VT-T) fiscal Q4/11 results. We are looking for EBITDA of $109 million versus $138 million a year ago. Consensus EBITDA estimate is $111 million (range of $89134 million). January 31: Metro Inc. (MRU.A-T) fiscal Q1/12 results. We are looking for EPS (f.d.) of $0.97 versus $0.88 a year ago. Consensus is also at $0.97 (range of $0.951.00). Its AGM is on the same date January 20: Statistics Canada December CPI release. Our Sector Stance Substantially higher fuel and food prices, coupled with the troubled economy, have forced consumers to review how they allocate their spending. Consumers on both sides of the border have been making a greater percentage of their purchases on promotion, avoiding unnecessary driving, and cutting back on discretionary spending although discretionary spending in Q4/11 seems to be a little more encouraging. Consequently, the companies under our coverage generally need to battle daily for meaningful top-line growth, keeping the retail environment highly promotional. All are strong operators, although some stand out more than others. Moreover, not all are at the same stage of execution on internal programs, and this tends to lead to varying degrees of growth and operational efficiency opportunities. Sector valuations have contracted considerably, but catalysts are still lacking to drive share prices materially higher without a corresponding move in the general markets. The focus of our investment strategy remains on companies that either:

35

1) have extremely strong balance sheets, with sufficient FCF to make accretive acquisitions (using low-cost capital) when they become available, and pursue a more active normal-course issuer bid than usual while they wait; and/or 2) have above-average growth and internal efficiency programs that should permit them to grow earnings meaningfully in excess of their sector peers; and 3) have valuations close to historical lows.

Alimentation Couche-Tard Inc.

(ATD.B-T, $31.70) 12-month Target: $38.00 Michael Van Aelst 514 289 0518 We expect double-digit growth in the high-margin fresh food category; a tight grip on operating costs; roughly 5% annual share-count reduction (via the companys normal course issuer bid); and accretion from previously announced acquisitions to combine to drive 1520% annual EPS growth for the foreseeable future. We expect this to help the company achieve our Street-high estimates for both fiscal 2012 and 2013. Couple this with what we view as a clean balance sheet, below average valuation, and an exceptional 10% FCF yield in fiscal 2013, and we remain confident in maintaining Couche-Tard as our top pick in the sector.

Loblaw Companies Ltd.

(L-T, $38.48) 12-month Target: $50.00 Michael Van Aelst 514 289 0518 While the anticipated completion date for the IT integration seems to be everextending (SAP store installs are now expected to be mostly complete by the end of 2013), the added caution has at least enabled the supply chain and IT integration to progress without any major hiccups. As well, EPS has continued to grow, despite the substantial related expenses (management reconfirmed that IT expenses would peak in 2012). Market sentiment could very well remain soured in the near term by the extension of the IT integration at store level into 2014, but we argue that significant progress is still being made. EPS growth should extend its streak of 14 straight growth quarters, with the pace accelerating as IT expenses start to tail off. At the very least, we believe that downside is limited, by an estimated $34 per share minimum real estate value. Strong gross margin improvement and very tight control on non-IT operating expenses should combine with anticipated share gains by H2/12 to drive much stronger earnings growth over the next few years, accelerating in 2013 as IT spending starts to decline. Food price inflation (in the retailers basket), assumed at 1.52.0% for 2012, should help to offset operating cost inflation, and, in Loblaws case, add to the gross margin expansion trend already under way from improvements in private label and general merchandise. Loblaw remains rated an Action List BUY.

36

Consumer Staples Universe

Overall Curr. Exch. T T T T T T T T T T T T T T $10.74 Oct C$ 371.7 $3,992 $0.10 0.9% $0.46 $0.74 $0.71 $518 $700 $662 14.5x 15.1x $49.36 Dec C$ 160.0 $7,898 $0.68 1.4% $2.04 $2.36 $2.74 $688 $683 $739 20.9x 18.0x 12.1x 8.0x $41.14 Dec C$ 217.4 $8,944 $1.00 2.4% $2.72 $2.84 $2.98 $1,180 $1,212 $1,238 14.5x 13.8x 8.2x $39.03 Mar C$ 206.4 $8,056 $0.76 1.9% $1.83 $2.22 $2.47 $692 $791 $841 17.6x 15.8x 10.8x $5.26 Sep C$ 88.8 $467 $0.34 6.5% $0.51 $0.37 $0.45 $71 $66 $79 14.2x 11.7x 9.7x 8.1x 10.2x 8.0x 11.2x 8.5x $8.55 Dec C$ 29.6 $253 $0.70 8.2% $0.88 $0.77 $0.79 $31 $30 $31 11.1x 10.8x 10.1x 9.7x $20.15 Jan C$ 48.3 $973 $1.05 5.2% $1.58 $1.23 $1.32 $125 $128 $136 16.4x 15.3x 8.9x 8.4x $54.00 Sep C$ 102.1 $5,513 $0.77 1.4% $3.56 $3.87 $4.30 $788 $794 $826 14.0x 12.6x 7.9x 7.6x $56.00 $21.00 $9.50 $5.25 $45.00 $46.00 $57.00 $12.50 $10.83 Dec C$ 140.0 $1,516 $0.16 1.5% $0.73 $1.03 $1.17 $360 $419 $459 10.5x 9.3x 6.1x 5.5x $15.00 $12.75 Feb C$ 227.3 $2,898 $0.24 1.9% $0.69 $0.78 $0.86 $269 $291 $305 15.3x 13.8x 10.7x 10.3x $13.00 $59.11 Apr C$ 68.0 $4,019 $0.90 1.5% $4.15 $4.43 $4.61 $819 $833 $800 13.0x 12.5x 5.6x 5.8x $62.00 6% 4% 40% 5% 9% 19% 6% 17% 14% 17% 17% $10.62 Dec C$ 22.8 $242 $1.08 10.1% $0.80 $0.57 $0.83 $37 $44 $53 18.6x 12.8x 10.0x 8.2x $11.00 14% $38.48 Dec C$ 281.0 $10,813 $0.84 2.2% $2.62 $2.85 $3.25 $2,025 $2,120 $2,340 13.5x 11.8x 7.2x 6.5x $50.00 32% $31.70 Apr US$ 183.0 $5,801 $0.30 0.9% $1.53 $1.97 $2.28 $626 $735 $802 16.4x 14.2x 8.2x 7.5x $38.00 21% AL BUY AL BUY HOLD HOLD HOLD BUY BUY HOLD HOLD HOLD HOLD HOLD BUY BUY Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011E 2012E 2010A 2011E 2012E 2011E 2012E 2011E 2012E Target Return Rating YearRep. Shares Market Ind. EPS EBITDA (mm) P/E (x) EV/EBITDA (x) 12-Month Total Risk Rating MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM HIGH MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM Analyst MV MV DL MV MV MV MV MV DL MV MV MV MV CR

Stock Name

Symbol

Alimentation Couche-Tard Inc.

ATD.B

Loblaw Companies Ltd.

Colabor Group Inc.

GCL

Empire Company Ltd.

EMP.A

The Jean Coutu Group (PJC) Inc.

PJC.A

Maple Leaf foods Inc.

MFI

Metro Inc.

MRU.A

North West Company Inc.

NWC

Pizza Pizza Royalty Income Fund

PZA.UN

Rogers Sugar Inc.

RSI

Saputo Inc.

SAP

Shoppers Drug Mart Corp.

SC

Tim Hortons Inc.

THI

Viterra Inc.

VT

Note 1: Curr. Price, Market Cap, and Ind. Div. for ATD.B are in C$.

Note 2. EPS figures for NWC and GCL are fully taxed.

AL BUY = Action List BUY Analyst(s): MV = Michael Van Aelst, CFA 514 289 0518; CR = Cherilyn Radbourne, CA, CFA, 416 308 3403; DL = Derek J. Lessard 514 289 0384

37

Diversified Financials
200 160 120 80 40 Jan05 Jan06 Jan07 Jan08 Jan09 Jan10 Jan11 Action List Com p. Group* S&P/TSX Com p. 1M (25.8) 0.1 (1.7) 3M (24.0) 2.1 3.6 Total Return % 6M (40.7) (9.7) (8.9) 12M (47.3) 3.4 (8.7) YTD (47.3) 3.4 (8.7) Cum .1 (13.7) 41.6 58.4

* S&P/TSX Diversified Financials (Industry Group) Since January 6, 2005

Action List

Comp Group*

S&P/TSX

Doug Young, CFA 416 308 2361 doug.young@tdsecurities.com Graham Ryding 416 308 4416 graham.ryding@tdsecurities.com

Industry Overview
On average, our asset management coverage group fell by 2.2% in December, in line with the S&P/TSX Composite (down 1.7%), but underperforming the S&P/TSX Capped Financials Index (up 2.5%). Among the larger cap mutual fund companies, CI Financial (CIX-T) was the top performer, with its shares up 2.9%, while IGM Financial (IGM-T) shares were up as well by 2.1%, as were AGF Management (AGF-T) shares by a more modest 0.8%. Sprott (SII-T) shares were down a considerable 19.7% in December, due to the weakness in bullion and gold/silver equities. Gluskin Sheff & Associates (GS-T) was up 2.8% by comparison. Canaccord Financial (CF-T) shares were down a significant 19.4% in December, illustrating investor skepticism toward its announced acquisition of Collins Stewart Hawkpoint in the U.K. Larger cap names Power Corp. of Canada (POW-T) and Power Financial Corp. (PWF-T) were up a healthy 6.9% and 4.1%, respectively. TMX Group (X-T) shares were down 6.2%. Among income yielding names, Morneau Shepell (MSI-T) was up 9.8%, while First National Financial (FN-T) was also up 15.6%. We recently launched coverage of Alt-A mortgage lender Equitable Group (ETC-T), which was down 4.2% in December. Things to Watch For in the Coming Month During the first week of January, TMX will release December trading and financing statistics, and we also expect to publish our Monthly Brokerage Overview. In midJanuary, the Investment Funds Institute of Canada (IFIC) will release monthly mutual fund AUM and net sales data. We are expecting AGF Management to report fiscal Q4/11 results on Friday, January 27. Our Sector Stance Our view on the asset management space remains neutral. We expect equity fund net outflows and inflows into lower risk balanced and bond funds to continue over the near term. Industry margins will likely be compressed over the near future due to the recent market contraction, and, by default, declining assets under management (AUM). Canadian banks are taking net flows/AUM market share due to their strong

38

distribution platforms and broad offerings in fund of funds/wraps, and balanced/bond funds products that are attracting the bulk of flows. We believe that only asset managers with strong fund performance and distribution platforms (proprietary, partnerships, and independent advisors support) will be able to compete effectively. In our view, CI Financial has some of the strongest fundamentals among the independents, and we rate it a BUY. We believe Canaccord Financials proposed acquisition of the U.K. based brokerage, Collins Stewart Hawkpoint, adds some uncertainty to its outlook, given the associated market risk and integration execution risk. However, we rate Canaccord a BUY, given our belief that it has significant leverage to improving market activity one year out, with its focus on the commodity sector and smaller cap names, and the addition of Genuity to its platform. We also have a BUY rating on Morneau Shepell; new business wins in 2011 have led to an improved earnings outlook, in our view, and we value its highly recurring revenue model. Lastly, we have a BUY rating on Equitable Group, given that we see attractive upside potential for it over the next 12 months, while assuming minimal valuation expansion (1.1x BVPS, versus 1.0x currently). We have attempted to be conservative with our estimates, which are below consensus, given the downside risk to the Canadian residential market.

39

40
Ent. Curr. Symbol CIX IGM AGF.B GS SII T $5.79 Dec C$ $981 $795 2.1% 7.7% 11.6x 15.6x 10.1x 7.8x 5.2x $9.00 58% T $14.91 Jun C$ $434 $350 4.4% 6.6% 11.0x 10.4x 11.6x 5.5x 5.8x $21.00 45% T $15.82 Nov C$ $1,506 $1,327 6.8% 3.0% 9.5x 11.6x 12.3x 5.9x 6.2x $17.50 17% T $44.23 Dec C$ $11,387 $10,642 4.9% 8.8% 17.4x 13.7x 14.4x 8.0x 8.3x $48.00 13% HOLD HOLD HOLD HOLD T $21.10 Dec C$ $6,008 $6,502 4.3% 9.2% 15.8x 16.2x 15.7x 9.6x 9.3x $24.00 18% BUY Exch. Price End Curr. Cap (mm) ($mm) Yield AUM FCF (3) 2011E 2012E 2011E 2012E Target Return Rating Year Rep. Market Value (2) Div. EV/ P/ P/EPS 12-Month Total EV/MFEBITDA Risk Rating MEDIUM MEDIUM MEDIUM MEDIUM HIGH Analyst DY DY DY DY DY Overall Overall Curr. Symbol CF T $7.80 Mar C$ 83.3 $650 $0.40 5.1% 0.9x $0.60 $0.82 13.0x 9.5x Exch. Price End Curr. O/S (mm) Cap (mm) Div. Yield BVPS 2011E 2012E 2011E 2012E Target $11.00 Year Rep. Shares Market P/ EPS (1) P/E 12-Month Total Return 46% Rating BUY Risk Rating HIGH Analyst GR Overall Curr. Symbol POW PWF T $25.54 Dec C$ 708.0 $18,083 5.5% 7.4% 1.6x $2.50 $2.53 T $23.82 Dec C$ 459.9 $10,955 4.9% 18.9% 1.2x $2.60 $2.36 9.2x 10.2x Exch. Price End Curr. O/S (mm) Cap (mm) Yield to NAV BVPS 2011E 2012E 2011E Year Rep. Shares Market Disc. P/ EPS P/E 2012E 10.1x 10.1x 12-Month Target $28.00 $30.00 Total Return 22% 23% Rating BUY BUY Risk Rating LOW LOW Analyst DY DY Overall Curr. Symbol X T $41.69 Dec C$ 74.6 $3,110 $3,125 3.8% Exch. Price End Curr. O/S (mm) Cap (mm) Value Yield EBITDA (1) 2011E Year Rep. Shares Market Ent. EV/ EPS (2) 2012E 2011E P/E 2012E 12-Month Target Restricted Total Return Rating Risk Rating Analyst Overall Curr. Symbol MSI ETC FN T $17.45 Dec C$ 60.0 $1,046 $1,224 7.2% T $25.00 Dec C$ 15.0 $375 $434 1.9% T $10.44 Dec C$ 47.9 $500 $714 7.5% Exch. Price End Curr. O/S (mm) Cap (mm) Value Yield Year Rep. Units Market Ent. EV/ EBITDA (1) 10.4x na na 2011E $0.50 $4.12 $1.37 EPS 2012E $0.61 $4.55 $1.74 2011E 21.0x 6.1x 12.7x P/E 2012E 17.1x 5.5x 10.1x 12-Month Target $12.00 $35.00 $18.50 Total Return 22% 42% 13% Rating BUY BUY HOLD Risk Rating MEDIUM HIGH HIGH Analyst GR GR GR

Diversified Financials Universe

Mutual Fund Companies

CI Financial

IGM Financial Inc.

AGF Management Ltd.

Gluskin Sheff + Associates (1)

Sprott Inc.

(1) GS's fiscal year ends June 30th. EPS & EBITDA in table represent calendar year estimates. (2) Enterprise value excludes non-mutual fund businesses. (3) Free cash flow is an estimate of four quarters forward.

Brokerages

Canaccord Financial (1)

(1) CCI's Fiscal Year Ends March 31st. EPS in table represents normalized calendar year estimates.

Power Group of Companies

Power Corporation of Canada

Power Financial Corporation

Financial Exchanges

TMX Group Inc.

(1) LTM basis, excludes investment income; (2) EPS estimate based on listing fees received on a cash basis (IFRS accounting).

Diversified Financials

Morneau Shepell Inc. (2)

Equitable Group Inc.

First National Financial Corp. (3)

(1) LTM basis

(2) Formerly Morneau Sobeco Income Fund, (3) formerly First National Financial Income Fund.

AL BUY = Action List BUY Analyst(s):DY = Doug Young, CFA 416 308 2361; GR = Graham Ryding 416 308 4416

Energy Producers Intermediate

1,050 850 650 450 250 50 Feb01 Feb02 Feb03 Feb04 Feb05 Feb06 Feb07 Feb08 Feb09 Feb10 Feb11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. 0.0 (1.2) (1.7) 3M 0.0 12.6 3.6 6M 0.0 (14.1) (8.9) 12M 0.0 (17.7) (8.7) YTD 0.0 (17.7) (8.7) Cum .1 820.1 232.2 82.0

* S&P/TSX Capped Energy Trust Oil & Gas Exploration & Production (Subindustries) Since February 19, 2001

Action List

Comp Group*

S&P/TSX

Roger Serin, P. Eng. 403 299 7964 roger.serin@tdsecurities.com Travis Wood 403 292 1222 travis.wood@tdsecurities.com Juan Jarrah, P.Eng. 403 299 3494 juan.jarrah@tdsecurities.com

Industry Overview
Performance Summary for the Month Following minor losses in November (-0.7%), our intermediate E&P coverage group was up slightly (about 1%) in December, beating the S&P/TSX Index. Petrobakken (PBN-T) and Westfire (WFE-T) led the pack, posting gains of 28% and 22%, respectively. The gains followed press releases from the companies from Petrobakken that it will exceed its exit guidance for 2011 and implement a DRIP; and from Westfire that it is reviewing strategic options. On the other end of the spectrum were Advantage (AAV-T) and Progress (PRQ-T), down 11% and 8%, respectively. Both companies have high natural gas weightings, with little liquids production. Things to Watch For in January Consensus (and TD Securities) 2012 production and cash flow estimates factor in a gas price recovery, which may or may not materialize. Consensus average estimate for 2012 AECO is currently $3.85/mscf, implying over 30% improvement from current prices. While a handful of companies provided 2012 capital budgets to date, we expect more capital budgets to be released through Janaury, and possibly a few common themes will be articulated in these budgets to account for the current gas price environment. With the forward 12-month AECO pricing currently averaging about $2.92/msf, we believe that there are a few levers available to companies under a $3.00/mcf AECO price environment, where sector coverage cash flow drops by about $1 billion, or 9%. With lower cash flow in 2012, we believe that most companies releasing budgets will talk about (in order): 1) relying on the balance sheet to get through the low gas prices; 2) reallocating capital to liquids plays; 3) asset sales; 4) reducing capex (and lower growth); and/or 5) reducing dividends. Sector Stance In our view, valuations today are still at the high end of the historical range, based on our commodity price outlook. Accordingly, we are maintaining our market weight sector weighting.

41

The sector trades at a P/NAVMG of 83% using year-end 2010 reserves, December 1, 2011 strip pricing, and an 8% after tax discount rate. Using TD Securities commodity price forecasts, we calculate an average 2012E EV/DACF multiple of 7.9x for the sector. Both metrics are at the middle to higher end of the historical range.

42

Energy Producers Intermediate Universe

Overall Curr. Symbol AAV ARX BNP BTE CLT CPG CR ERF FRU LEG LPR NAE NVA PEY PGF PMT POU PRQ PWT SGY TOU VET WFE WSX ZAR PBN TET T $37.57 Dec C$ T $12.83 Dec C$ T $13.63 Dec C$ 29.7 $404 $2.17 $2.56 6.9x V $8.91 Dec C$ 68.3 $609 $1.22 $1.70 5.9x T $5.70 Dec C$ 83.0 $473 $1.11 $1.40 4.8x 1.6x 1.0x 1.9x T $45.37 Dec C$ 97.6 $4,429 $5.08 $5.52 8.6x 1.1x T $26.63 Dec C$ 158.0 $4,208 $1.70 $2.60 10.6x 0.4x T $8.94 Dec C$ 71.3 $637 $1.01 $1.84 5.8x 1.0x 26% 85% 36% 31% 7% 36% T $20.19 Dec C$ 479.7 $9,686 $3.14 $3.77 6.8x 2.1x 32% T $13.24 Dec C$ 234.1 $3,099 $1.01 $1.27 11.5x 1.9x 86% T $42.50 Dec C$ 85.2 $3,620 $1.35 $2.37 16.6x 2.0x 78% 0% 3% 5% 0% 0% 5% 0% 0% 9% T $1.17 Dec C$ 147.2 $172 $0.48 $0.62 5.8x 6.0x 86% 0% T $10.76 Dec C$ 366.0 $3,938 $1.83 $1.78 7.2x 1.8x 46% 8% T $24.39 Dec C$ 138.0 $3,365 $2.39 $2.66 10.6x 1.7x 91% 3% T $5.24 Dec C$ 99.5 $521 $1.54 $1.95 3.9x 1.5x 67% 0% 111% 146% 139% 244% 414% 193% 129% 226% 240% 141% 189% 188% 173% T $7.88 Dec C$ 153.7 $1,211 $1.84 $1.80 5.5x 2.2x 51% 11% 122% T $7.21 Dec C$ 85.0 $613 $1.60 $2.62 3.9x 1.4x 64% 0% 194% T $10.48 Dec C$ 143.3 $1,501 $1.33 $1.55 7.8x 2.1x 18% 0% 172% 124% 90% 117% 88% 150% 118% 92% 187% 179% 112% 117% 122% 106% 133% 118% 158% T $19.41 Dec C$ 63.2 $1,227 $2.01 $2.08 9.8x 0.5x 37% 9% 75% 77% T $25.85 Dec C$ 183.6 $4,747 $3.26 $4.55 6.9x 1.6x 54% 8% 186% 128% T $11.25 Dec C$ 119.6 $1,345 $1.56 $2.21 6.0x 1.3x 49% 0% 216% 112% $16.00 $33.00 $19.00 $16.00 $11.00 $9.00 $10.50 $31.00 $12.00 $1.75 $48.00 $16.50 $23.00 $14.50 $40.00 $53.00 $8.50 $14.00 $16.50 T $44.90 Dec C$ 301.5 $13,536 $4.61 $4.61 10.4x 1.0x 10% 6% 118% 103% $51.00 T $22.87 Dec C$ 104.7 $2,395 $1.41 $2.40 9.9x 0.9x 80% 0% 230% 143% $29.00 T $56.97 Dec C$ 118.8 $6,766 $4.76 $5.33 11.1x 1.0x 15% 5% 102% 101% $62.00 13% 27% 20% 42% 36% 7% 53% 53% 25% 100% 30% 19% 50% 13% 28% 19% 62% 50% 22% 49% 57% 30% T $26.07 Dec C$ 166.1 $4,330 $3.33 $3.54 8.6x 1.9x 60% 6% 119% 106% $33.00 32% T $25.10 Dec C$ 292.4 $7,340 $3.03 $3.15 8.7x 1.0x 60% 5% 112% 109% $29.00 20% T $4.24 Dec C$ 165.9 $704 $0.90 $1.00 5.3x 1.6x 92% 0% 131% 90% $7.00 65% BUY BUY BUY BUY HOLD BUY BUY BUY HOLD BUY BUY HOLD BUY BUY BUY HOLD HOLD HOLD BUY BUY BUY BUY BUY BUY HOLD Exch. Price End Curr. O/S (mm) Cap (mm) 2011E 2012A 2012E 2012E Prod'n 2012E 2011E 2012E Target Return Rating YearRep. Shares Market CFPS EV/DACF Debt/CF % Gas Yield Payout Ratio 12-Mth Total Risk Rating HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH Analyst RS RS RS TW RS RS RS RS RS TW RS TW RS TW RS RS RS RS RS TW RS TW JJ JJ RS RS RS

Stock Name

Advantage Oil & Gas Ltd.

ARC Resources Ltd.

Bonavista Energy Corp.

Baytex Energy Corp.

Celtic Exploration Ltd.

Crescent Point Energy Corp.

Crew Energy Inc.

Enerplus Corp.

Freehold Royalties Ltd.

Legacy Oil and Gas Inc

Lone Pine Resources

NAL Energy Corp.

NuVista Energy Ltd.

Peyto Exploration Corp.

Pengrowth Energy Corp.

Perpetual Energy Inc.

Paramount Resources Ltd.

Progress Energy Resources Corp.

Penn West Exploration

Surge Energy Inc

Tourmaline Oil Corp.

Vermilion Energy Inc.

Westfire Energy

Wild Stream Exploration Inc.

Zargon Oil & Gas Ltd.

PetroBakken Energy Ltd.

----------------------------------------------------------------------Restricted-------------------------------------------------------------------------------------------------------------------------------------------Restricted----------------------------------------------------------------------

Trilogy Energy Inc.

Commodity Price 2007A $72.23 $6.97 $6.46 $8.20 $4.00 $3.99 $3.75 $4.00 $8.89 $4.16 $4.36 $4.15 $4.50 $4.75 $4.00 $99.92 $61.97 $79.50 $93.00 $93.00 $90.00 2008A 2009A 2010A 2011E 2012E 2013E

Assumptions

WTI (US$/bbl)

NYMEX (US$/mcf)

AECO (C$/mcf)

AL BUY = Action List BUY

Analyst(s): RS = Roger Serin, P. Eng. 403 299 7964; TW = Travis Wood 403 292 1222; JJ = Juan Jarrah, P.Eng. 403 299 3494

43

Energy Producers International

150 120 90 60 30 Oct10 Dec10 Feb11 Oct11 Aug10 Aug11 Dec11 Apr11 Jun11 Action List Com p. Group* S&P/TSX Com p. 1M (12.8) (1.2) (1.7) 3M 26.9 12.6 3.6 Total Return % 6M (29.9) (14.1) (8.9) 12M (26.3) (18.0) (8.7) YTD (26.3) (18.0) (8.7) Cum .1 (25.2) (5.8) 4.8

* S&P/TSX Oil & Gas Exploration & Production (Subindustry) Since August 4, 2010

Action List

Comp Group*

S&P/TSX

Jamie Somerville 403 299 8586 jamie.somerville@tdsecurities.com Wael B. Halaoui 403 292 2804 wael.b.halaoui@tdsecurities.com

Industry Overview
Performance Summary for the Month Share prices for the International E&P companies under coverage decreased by 7% on average in December. Colombia-focused companies outperformed the group, with an average decrease of 3%, during a month when WTI and Brent was down 1%. Europe, Middle Eastern, and Asia-focused companies were down an average of 12% in December. The top performer in the group was Canacol Energy Ltd. (CNE-T), up 22%. On the other end of the spectrum, Porto Energy Corp. (PEC-V) was the weakest performer in our coverage, posting a loss of 48%. Things to Watch For in the Coming Month We expect Brent crude, which we see as more important for International E&Ps as a benchmark than WTI, to continue trading at a premium to WTI, likely remaining above US$90/bbl in the short term. However, in our opinion, crude prices will remain volatile, with short-term fluctuations driven largely by geopolitics and movements in the U.S. dollar. Following Q3/11 reporting, we expect strong quarter-over-quarter growth in CFPS, predominantly due to higher margins on the back of higher oil prices (as well as improved netbacks for some companies that have grown production). In addition, we anticipate a regular stream of news flow regarding ongoing exploration and appraisal drilling from the International E&Ps in our coverage. We expect the companies that have yet to announce 2012 budgets and production guidance to do so in January. Our Sector Stance Over the long term, we expect International E&Ps to outperform due to access to large resources, oil pricing linked to Brent, and oil prices that are likely to remain above historical norms. We expect valuations to improve, if companies are able to report positive drilling and operational updates. The International E&Ps in our coverage are currently trading at around 0.39x Fully-risked NAVPS, well below long-run average valuation for the sector, which we estimate at 0.700.75x. If markets become less risk averse, International E&Ps will likely outperform other sectors. We recommend an overweight sector stance.

44

Bankers Petroleum Ltd.

(BNK-T, C$4.44); 12-Month Target: C$11.50 Jamie Somerville 403 299 8586 We added Bankers Petroleum to the Action List on March 30. Bankers Petroleum is developing the Patos Marinza heavy oil field in Albania, Europes largest onshore oil field estimated to hold 7.5 billion barrels of OOIP. We expect the companys management to grow reserves and production through implementation of modern heavy oil technology prior to considering a potential corporate sale. Bankers trades at 0.57x Base NAVPS, a 69% discount to other producers in our coverage of International E&Ps.

45

46
Overall Curr. EPS (f.d) 2010A $0.06 $0.00 ($0.02) $0.61 $0.14 $2.30 $0.75 ($0.20) ($0.02) $2.29 ($0.06) ($0.00) ($0.23) ($0.03) ($0.01) $0.05 ($0.02) ($0.01) $0.06 10.6x 0% ($0.22) $0.10 $0.05 $0.18 $0.28 5.5x 52% ($0.01) $0.00 ($0.00) ($0.00) $0.00 nmf 0% nmf 2.1x 13.3x ($0.04) ($0.04) ($0.03) ($0.02) ($0.01) nmf 43% nmf $4.27 $3.86 $5.44 $7.01 $7.88 2.2x 0% 0.6x ($0.01) $0.01 ($0.01) ($0.00) $0.02 11.2x 1% 22.5x $0.65 $32.00 $0.50 $0.60 $3.00 $1.25 $0.35 $1.17 ($0.12) $0.86 $2.05 3.3x 0% nmf $9.00 $2.32 $2.97 $2.28 $5.05 $5.44 2.9x 7% 0.0x $35.00 ($1.19) $2.05 $5.45 $4.48 $3.47 14.2x 96% 1.0x $85.00 77% 89% 29% 217% 96% 317% 69% 121% 87% $0.44 $0.94 $0.77 $1.21 $1.42 2.3x -21% nmf $9.00 83% $1.06 $1.36 $1.60 $2.17 $2.81 1.9x 0% nmf $13.50 78% $0.09 $0.09 $0.08 $0.19 $0.19 3.4x 31% nmf $1.35 75% $0.00 $0.04 $0.06 $0.06 $0.10 13.6x 84% nmf $5.50 255% BUY BUY BUY BUY BUY BUY HOLD SPEC BUY BUY SPEC BUY SPEC BUY BUY SPEC BUY $0.19 $0.28 $0.30 $0.63 $0.94 4.0x 0% nmf $11.50 159% AL BUY 2011E 2012E 2010A 2011E 2012E 2012E 2010E 2011E Target Return Rating CFPS (f.d) Exch. T, L T V, BVC T T, N T T, BVC V V T V V, OMX T, N V $0.67 Dec US$ 371.1 $249 $1.36 Dec US$ 365.7 $497 $0.36 Dec US$ 808.0 $287 $0.12 Aug US$ 199.0 $24 $16.56 Dec US$ 100.6 $1,667 $0.21 Dec US$ 482.5 $99 $6.97 Dec US$ 108.2 $754 $18.73 Dec US$ 271.6 $5,088 $48.23 Mar US$ 51.6 $2,489 $4.92 Dec US$ 277.6 $1,366 $7.57 Dec US$ 63.8 $483 $0.77 Jun US$ 619.1 $477 $1.55 Dec US$ 144.3 $224 $4.44 Dec US$ 247.5 $1,099 Price End Curr. O/S (mm) Cap (mm) YearRep. Shares Market EV/DACF % Gas Debt/CF 12-Month Total Risk Rating HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH SPEC HIGH SPEC SPEC HIGH SPEC Analyst JS JS JS JS JS JS JS JS JS JS JS WH JS WH

Energy Producers International Universe

Symbol

Bankers Petroleum Ltd.

BNK

BNK Petroleum Inc.

BKX

Canacol Energy Ltd.

CNE

C&C Energia Ltd.

CZE

Gran Tierra Energy Inc.

GTE

Niko Resources Ltd.

NKO

Pacific Rubiales Energy Corp.

PRE

Parex Resources Inc.

PXT

Petrodorado Energy Ltd.

PDQ

Petrominerales Ltd.

PMG

Porto Energy Corp.

PEC

ShaMaran Petroleum Corp.

SNM

TransAtlantic Petroleum Ltd.

TNP

WesternZagros Resources Ltd.

WZR

AL BUY = Action List BUY

Analyst(s): JS = Jamie Somerville 403 299 8586; WH = Wael B. Halaoui 403 292 2804

Energy Producers Senior & Unconventional

140 120 100 80 60 Oct10 Feb10 Feb11 Oct11 Jun11 Dec09 Dec10 Aug10 Aug11 Dec11 Jun10 Apr10 Apr11 Action List Com p. Group* S&P/TSX Com p. 1M 0.7 (1.5) (1.7) 3M 25.4 11.7 3.6 Total Return % 6M (4.3) (13.8) (8.9) 12M (4.8) (15.5) (8.7) YTD (4.8) (15.5) (8.7) Cum .1 (4.8) (0.0) 10.1

* S&P/TSX Oil & Gas Integrated, Oil & Gas Exploration & Production (Subindustries) Since December 7, 2009

Action List

Comp Group*

S&P/TSX

Menno Hulshof, CFA 403 299 8658 menno.hulshof@tdsecurities.com

Industry Overview
Performance Summary for the Month Petrobank Energy & Resources Ltd. (PBG-T) was the top performer among the Senior, Integrated and Oil Sands producers in December, posting a return of 15%. The weakest performer in our space was BlackPearl Resources Inc. (PXX-T), which was down 8%. Things to Watch For in the Coming Month For the week ended December 23, U.S. DOE total crude complex inventories rose by 4.4 mmbbls to 685.5 mmbbls. Although inventory levels are below the top end of the five-year range, excess domestic supply remains an issue, as does underlying demand. Meanwhile, the Brent premium to WTI continues to narrow, with MENA (namely Libya) and North Sea production gradually coming back on-stream. We believe anticipation of the upcoming Seaway pipeline reversal (slated for Q2/12) is also playing a role in this narrowing. The Brent-WTI spread at month-end stood at US$8.75/bbl, down from US$9.85/bbl at the end of November. In North America, synthetic crude oil (SCO) continues to trade at a premium to WTI, although this premium is rapidly shrinking. The Syncrude Sweet Blend (SSB) differential to WTI averaged US$2.94/bbl in December (compared to a 2010 average discount of US$1.19/bbl). Although this is much smaller than it was in prior quarters, we expect this modest SSB premium to remain in effect until the Cushing inventory issue is debottlenecked entirely. We continue to track Canadian heavy differentials closely, given the rapidly changing supply/demand dynamic for heavies and their clear impact on Canadian bitumen and heavy oil producers. The WCS/WTI differential averaged 15.1% in December, compared with 12.5% in November and 20.9% in December 2010. We are currently forecasting a very conservative 2012 WCS/WTI heavy differential of 21% (and 23% longer term). Lastly, the U.S. mid-continent (USMC) 321 crack spread closed at US$12.28/bbl in December, averaging US$11.97/bbl for the month. This is below the November average of US$18.94/bbl, and only marginally higher than the December 2010

47

average of US$10.52/bbl. The decrease in mid-continent (PADD II) crack spreads for the month was due to the up-tick in WTI pricing relative to Brent; again, we believe this is being driven by increasing MENA/North Sea volumes and news relating to the reversal of the Seaway pipeline. The cheap feedstock advantage for PADD II refiners appears to be quickly disappearing. Our Sector Stance Our sector stance is unchanged at market weight. We continue to believe that global US$90/bbl oil prices are sustainable in the long term. The land-locked nature of WTI has resulted in discount pricing relative to its waterborne equivalents (e.g., Brent and LLS) although this discount is quickly disappearing. That said, we see Brent continuing to trade at a US$510/bbl premium until the Cushing bottleneck is resolved entirely (e.g., Seaway reversal in Q2/12 and Wrangler in 2013). Although the injection season is now behind us, natural gas prices remain weak, given the current supply glut and warmer winter temperatures. We envision a nearterm cap of US$4.004.50/mmBtu on natural gas prices, given the amount of gas that would make its way into the market once prices test this limit (on the basis of marginal supply cost estimates). Long term, LNG exports are the only legitimate solution to weak pricing, in our view. We do not expect to see meaningful LNG exports out of Canada until 2016 (and that assumes that the first phase of Kitimat comes on-stream in the late 2015 timeframe).

Canadian Natural Resources Ltd.

(CNQ-T, C$38.15); 12-Month Target: C$53.00 Menno Hulshof, CFA 403 299 8658 We added Canadian Natural Resources to the Action List on May 18. The January fire at its Horizon Upgrader and subsequent sell-off in its shares has created a unique entry point, in our view. With expectations of a return to full productive capacity at Horizon in 2012, we contend that the outlook is positive. The company also stands to benefit most from the recent narrowing in heavy differentials, a trend that is likely to persist for the foreseeable future.

Talisman Energy Inc.

(TLM-N, US$12.75); 12-Month Target: US$21.00 Menno Hulshof, CFA 403 299 8658 We added Talisman Energy to the Action List on December 19. This upgrade comes on the back of the three following reasons: 1) it is now trading at a 30% discount to its 2P NAV (and only a 14% premium to its 1P NAV), 2) it is now only trading at about a 1x premium to its 2008 lows (on a consensus P/CF basis), a time when oil prices were clearly much lower than they are now, and 3) we contend that fears related to its 2012 guidance release (to be issued on January 10) are overblown. As such (and barring a major correction in oil prices), we believe that there is limited downside from current levels.

48

Energy Producers Senior & Unconventional Universe

Senior Producers
Overall Curr. Total Return 40% 67% 34% 25% Rating AL BUY AL BUY HOLD HOLD Symbol CNQ TLM ECA NXY T, N $16.21 Dec C$ 527.4 $8,549 $2.26 $2.23 $2.65 $4.01 $4.37 $5.02 4.2x 17% 1.5x $20.00 T, N $18.53 Dec US$ 736.3 $13,644 $0.89 $0.61 $0.96 $6.01 $5.77 $5.82 4.4x 95% 2.1x $24.00 T, N $12.75 Dec US$ 1,021.7 $13,027 $0.32 $0.79 $1.27 $2.76 $3.45 $4.01 4.1x 56% 1.3x $21.00 T, N $38.15 Dec C$ 1,094.7 $41,765 $2.32 $2.21 $3.52 $5.70 $5.67 $7.29 6.0x 31% 1.0x $53.00 Exch. Price End Curr. O/S (mm) Cap (mm) 2010A 2011E 2012E 2010A 2011E 2012E 2012E 2012E 2012E Target YearRep. Shares Market EPS (f.d) EV/DACF % Gas Debt/CF 12-Month CFPS (f.d) Risk Rating HIGH HIGH HIGH HIGH Analyst MH MH MH MH

Canadian Natural Resources Ltd.

Talisman Energy Inc.

Encana Corp.

Nexen Inc.

Integrateds
Overall Curr. Symbol CVE HSE IMO SU T, N $29.38 Dec C$ 1,569.8 $46,120 $1.63 $3.40 $2.78 $4.08 $6.21 $5.50 5.6x T, N $45.39 Dec C$ 847.6 $38,473 $2.59 $3.57 $2.40 $3.53 $4.39 $3.30 14.2x T $24.55 Dec C$ 948.9 $23,294 $1.35 $2.40 $1.42 $4.09 $5.64 $4.24 5.6x T, N $33.83 Dec C$ 754.3 $25,519 $1.06 $1.80 $2.01 $3.20 $4.29 $4.06 8.4x 37% 33% 14% 12% Exch. Price End Curr. O/S (mm) Cap (mm) 2010A 2011E 2012E 2010A 2011E 2012E 2012E 2012E YearRep. Shares Market EPS (f.d) EV/DACF % Gas CFPS (f.d) Debt/CF 12-Month 2012E 1.1x 0.4x 1.1x 0.7x Target $41.00 $29.00 $45.00 $48.00 Total Return 24% 23% 0% 65% Rating HOLD HOLD HOLD BUY Risk Rating HIGH HIGH MEDIUM HIGH Analyst MH MH MH MH

Cenovus Energy Inc.

Husky Energy Inc.

Imperial Oil Ltd.

Suncor Energy Inc.

Unconventionals
Overall Curr. Symbol AEF PXX COS MEG PBG T $10.58 Dec C$ T $41.57 Dec C$ 192.9 $8,019 $0.07 $0.39 $0.47 T $23.25 Dec C$ 484.5 $11,265 $1.83 $2.33 $3.02 T $4.11 Dec C$ 284.7 $1,170 ($0.11) $0.03 $0.11 $0.21 $2.39 $0.88 T $3.53 Dec US$ 411.1 $1,451 NMF $0.10 $0.35 NMF Exch. Price End Curr. O/S (mm) Cap (mm) 2010A 2011E 2012E 2010A YearRep. Shares Market EPS (f.d) CFPS (f.d) 2011E $0.11 $0.24 $3.97 $1.23 2012E $0.46 $0.35 $3.43 $1.28 EV/DACF 2012E 7.1x 10.6x 6.9x 24.2x % Gas 2012E 23% 1% 0% 0% Debt/CF 12-Month 2012E NMF NMF 0.5x 6.9x Target $4.25 $6.50 $29.00 $57.00 Total Return 20% 58% 30% 37% Rating BUY SPEC BUY BUY BUY Risk Rating HIGH SPEC HIGH HIGH Analyst MH MH MH MH MH

Aurora Oil & Gas Ltd.

BlackPearl Resources Inc.

Canadian Oil Sands Ltd.

MEG Energy Corp.

Petrobank Energy & Resources Ltd.

------------------------------------------------------------------------------------------------------ Restricted ---------------------------------------------------------------------------------------------

AL BUY = Action List BUY Analyst(s):MH = Menno Hulshof, CFA 403 299 8658

49

Energy Services
200 160 120 80 40 0 Nov04 Nov05 Nov06 Nov07 Nov08 Nov09 Nov10 Nov11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. 1.1 (0.3) (1.7) 3M 18.4 17.1 3.6 6M (22.3) (13.7) (8.9) 12M (14.7) (0.7) (8.7) YTD (14.7) (0.7) (8.7) Cum .1 (54.5) 37.0 61.9

* S&P/TSX Energy Equipment & Services (Industry) Since November 12, 2004

Action List

Comp Group*

S&P/TSX

Scott Treadwell, P. Eng. 403 299 3296 Scott.Treadwell@tdsecurities.com

Industry Overview
Performance Summary for the Month Following a strong rebound in October, flowing into the first couple weeks of November, the S&P/TSX Energy Equipment & Services Index has cooled somewhat and realized a 0.3% loss for December. This compares to the broader Capped Energy Index, which shed 1.8%, and the S&P/TSX Composite Index, which fell 2.0% (total return basis). Our coverage group slipped 1.9% on the month, supported higher by the transportation and infrastructure companies, fuelled by ShawCors 14.2% surge for the month. Service companies Precision (PD-T) and GasFrac (GFS-T) were the largest drags on our coverage universe, shedding 10.9% and 9.8%, respectively. On average, transportation and infrastructure companies were up 4.6%, followed by the large cap pumpers increase of 1.9%, while the drillers shed 5.1%, and the small caps were down 5.4%. Things to Watch For in the Coming Month Despite macro uncertainty, we believe that the sectors performance and outlook remains robust, supported by strong activity, contracts, and backlogs. We expect further clarity on producer capital spending in 2012 in December; early data points indicate a small (under 5%) increase in overall spending. However, we expect commodity price strength, the shift in spending from land to drilling, and the injection of JV partner capital to drive the drilling and completions spending solidly above 2011 levels. Our Sector Stance We are market weight the Canadian oil service sector. Share prices of many of the oil service companies under our coverage continue to trade well below their historical long-term valuations on our 2012 estimates.

50

Trican Well Service Ltd.

(TCW-T; C$17.55); 12-Month Target: C$34.00 Scott Treadwell, P. Eng. 403 299 3296 In line with our preference for the pressure pumpers, and based on relative valuation and industry fundamentals, Trican is our Action List BUY. We remain bullish on the North American pumping market, driven by increasing activity in existing plays (driven by longer horizontal wells and more stages pumped), as well as the forecast for key new plays (Duvernay and Muskwa oil in Canada). With a likely acceleration of activity in Horn River in late 2012 and into 2013, pumping fundamentals continue to support our bullish stance on the space. We believe Trican is having ongoing success in promoting itself as a technical leader in the U.S. pumping market, and job value and margins should continue to increase as a result. Furthermore, its spend on infrastructure in the U.S. has obviously affected margins. Even if pricing and operating margins do not move materially higher in 2012, the absence of start-up costs and lower early utilization on new assets should combine to raise Tricans margins in the U.S. Based on our estimates, we expect the company to realize roughly 25% annual growth in EPS in the period 2010 to 2012.

51

52
Overall 12-Mo Target $34.00 $59.00 $23.00 $17.50 $22.00 $14.00 $26.00 $15.00 $32.00 91% 59% 41% 14% $11.00 $11.00 $12.50 $23.00 44% 37% 86% 101% 37% 43% 12% 60% 48% 63% 33% 108% 94% Return Rating AL BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY Total Risk Rating Analyst HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH ST ST ST ST ST ST ST ST ST ST ST ST ST Curr. EPS (f.d.) Yield 0.6% 0.7% 2.3% 0.0% 2.1% 0.0% 5.1% 0.0% 1.1% 0.0% 0.0% 2.6% 0.9% $1.27 $1.96 $2.24 $68 $117 $134 7.8x 4.2x ($0.68) $0.60 $0.85 $194 $250 $320 9.1x 4.5x $0.10 $0.58 $0.92 $70 $133 $179 8.1x 4.1x $0.07 $0.30 $0.58 $23 $61 $107 11.9x 5.6x $1.22 $0.65 $2.29 $184 $120 $265 12.6x 7.0x 253% $0.22 $0.59 $1.34 $435 $656 $838 7.8x 4.1x 126% $0.98 $1.36 $1.70 $202 $284 $327 11.6x 6.2x 26% $0.12 $0.04 $1.06 $16 $20 $121 6.6x 3.3x 2521% $0.93 $1.36 $2.06 $90 $143 $219 5.8x 3.3x 51% $0.72 $0.65 $1.90 $120 $131 $223 6.7x 3.2x 191% $0.79 $1.50 $1.85 $310 $509 $635 8.8x 4.6x 24% $1.23 $3.85 $4.89 $185 $387 $476 5.8x 3.1x 27% $1.09 $2.25 $2.58 $330 $609 $772 6.8x 3.5x 15% 2010A 2011E 2012E 2010A 2011E 2012E (x) (x) ('11E-'12E) EBITDA (mm) Exch. T T T T T T T T, N T T T T T $17.36 Dec C$ 32.9 $519 $0.16 $7.77 Dec C$ 124.8 $857 $0.20 $7.45 Dec C$ 85.6 $599 $0.00 $6.87 Dec C$ 93.3 $588 $0.00 $28.88 Dec C$ 71.4 $1,916 $0.32 $10.50 Dec C$ 294.4 $2,696 $0.00 $19.65 Dec C$ 82.7 $1,554 $1.00 $6.98 Dec C$ 63.3 $416 $0.00 $11.95 Dec C$ 63.4 $720 $0.25 $12.77 Dec C$ 50.5 $557 $0.00 $16.25 Dec C$ 163.8 $2,284 $0.38 $28.50 Dec C$ 46.9 $1,172 $0.20 $17.55 Dec C$ 151.9 $2,435 $0.10 Price End Curr. (mm) (mm) Div. YearRep. Shares O/S Ind. Market Cap P/E 2012E EV/EBITDA 2012E EPS Growth PD

Energy Services Universe

Stock Name

Symbol

Trican Well Service Ltd.

TCW

Calfrac Well Services Ltd.

CFW

Ensign Energy Services Inc.

ESI

Flint Energy Services Ltd.

FES

Canyon Service Group

FRC

GasFrac Energy Services

GFS

Mullen Group Ltd.

MTL

Precision Drilling Corporation

ShawCor Ltd.

SCL'A

Secure Energy Services

SES

Savanna Energy Services Corp.

SVY

Trinidad Drilling Ltd.

TDG

Total Energy Services

TOT

AL BUY = Action List BUY Analyst(s): ST = Scott Treadwell, P. Eng. 403 299 3296

Gold & Precious Minerals

200 160 120 80 40 Mar07 Mar08 Mar09 Mar10 Sep07 Sep08 Sep09 Sep10 Mar11 Sep11 Action List Com p. Group* S&P/TSX Com p. 1M 0.0 (15.3) (1.7) 3M 0.0 (10.1) 3.6 Total Return % 6M 29.3 (5.9) (8.9) 12M 25.5 (18.4) (8.7) YTD 25.5 (18.4) (8.7) Cum .1 97.7 22.8 3.0

* S&P/TSX Gold, Precious Metals & Minerals (Subindustries) Since March 26, 2007

Action List

Comp Group*

S&P/TSX

Steven Green, CFA 416 307 6304 steven.green@tdsecurities.com Greg Barnes, 416 983 9588 greg.barnes@tdsecurities.com Daniel Earle, 416 308 7906 daniel.earle@tdsecurities.com Scott Parsons, CFA, 416 308 3404 scott.parsons@tdsecurities.com

Industry Overview
Performance Summary for the Month Gold averaged US$1,643/oz in December, down US$95 or 5.5% from Novembers average of US$1,738/oz. The U.S. Dollar Index continued to climb, increasing by 2.29%. The S&P/TSX Gold Index underperformed the metal, decreasing by 15.6% on a U.S. dollar basis compared to gold, which decreased by 10.5%. The best performers were European Goldfields (EGU-T, not rated) and Romarco Minerals (R-T, not rated), up 26.8% and 13.7%, respectively. The poorest performers were Eldorado Gold (ELD-T, BUY) and NovaGold (NG-T, not rated), down 19.1% and 20.9%, respectively. Things to Watch For in the Coming Month In the near term, we expect gold to trade higher, as investors continue to diversify away from equities, and European sovereign debt concerns persist. Our Sector Stance We remain positive on golds medium- to longer-term outlook and recommend an overweight sector stance. The fundamental factors that have underpinned the 11year bull market for gold remain intact in our view, including: central banks will likely remain net buyers of gold, as emerging economies look to diversify their reserve holdings; investment demand for gold (at the institutional and retail level) should remain strong, as individuals look to diversify their positions; ETF demand for gold bullion continues to grow; questions remain about the long-term viability of the U.S. dollar as the worlds reserve currency; continued improvement in the U.S. economic outlook could lead to accelerated inflation fears; global currency and trade imbalances remain; gold mine supply remains challenged over the longer term; and increased demand for labour and materials, further challenging the cost base to produce an ounce of gold.

53

We forecast that gold will average US$1,700/oz in 2012, US$1,500/oz in 2013, and US$1,500/oz in 2014. We project a long-term price of US$1,500/oz, based on our new spot-gold valuation methodology. We believe that investors are increasingly valuing gold equities on a spot basis. Given the unique nature of gold as a monetary asset, traditional supply and consumption flows are less informative for gold than they are for base metals.

54

Gold & Precious Metals Universe

Overall Curr. Exch. N,T N,T N,T N,T N,T T, A N,T T, N $16.18 Dec US$ 377.4 $6,014 $0.20 1.2% $0.76 $1.23 $1.37 $1.11 $1.77 $1.94 13.0x 11.6x 9.0x 8.2x $23.17 0.7x $36.32 Dec US$ 174.0 $6,320 $0.64 1.8% $1.74 $1.88 $2.01 $3.51 $3.87 $3.84 19.3x 18.1x 9.4x 9.5x $41.32 0.9x $14.02 Dec US$ 556.6 $7,686 $0.19 1.4% $0.39 $0.60 $1.02 $0.65 $0.92 $1.43 23.0x 13.5x 15.0x 9.7x $17.78 0.8x $14.69 Dec US$ 747.2 $10,976 $0.20 1.4% $0.61 $0.95 $1.23 $1.01 $1.66 $1.88 15.5x 11.9x 8.8x 7.8x $16.19 0.9x $20.00 $20.00 $52.00 $26.00 $11.40 Dec US$ 1,142.4 $13,023 $0.12 1.1% $0.57 $0.81 $1.18 $1.31 $1.44 $1.80 14.1x 9.7x 7.9x 6.3x $18.94 0.6x $18.50 $60.01 Dec US$ 504.0 $30,245 $1.40 2.3% $3.79 $4.23 $4.80 $7.82 $7.90 $8.21 14.2x 12.5x 7.6x 7.3x $64.03 0.9x $85.00 44.0% 63.3% 37.5% 44.0% 44.9% 61.9% $44.25 Dec US$ 814.4 $36,037 $0.54 1.2% $1.35 $2.10 $2.34 $2.44 $3.12 $3.57 21.1x 18.9x 14.2x 12.4x $44.71 1.0x $68.00 54.9% $45.25 Dec US$ 1,001.0 $45,295 $0.60 1.3% $3.28 $4.60 $5.10 $4.60 $6.44 $7.72 9.8x 8.9x 7.0x 5.9x $48.53 0.9x $67.00 49.4% BUY BUY BUY HOLD BUY BUY HOLD BUY Price End Curr. O/S (mm) (US$ mm) Div. Yield 2010A 2011E 2012E 2010A 2011E 2012E 2011E 2012E 2011E 2012E NAVPS P/NAV Target Return Rating YearRep. Shares Mkt Cap Ind. EPS CFPS P/E (x) P/CF (x) 12-Mo Total Risk Rating Analyst HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH GB GB GB GB SG SG GB SG

Stock Name

Symbol

Large-cap Producers GG

Barrick Gold Corp. (US$)

ABX

Goldcorp Inc. (US$)

Newmont Mining Corp. (US$)

NEM

Kinross Gold Corp. (US$)

KGC

Yamana Gold Inc. (US$)

AUY, YRI

Eldorado Gold Corp. (C$)

ELD, EGO

Agnico-Eagle Mines Ltd. (US$)

AEM

IAMGOLD Corp. (C$)

IMG, IAG

Junior/Intermediate Producers N,T T A,T T T Q,T T,N T T T T,A T,N T T T T T $3.25 Dec US$ 90.6 $290 n/a 0.0% ($0.36) $0.04 $1.00 $0.18 $1.28 Dec C$ 390.8 $493 n/a 0.0% ($0.02) ($0.01) $0.02 $0.00 $0.04 $0.95 $6.50 Dec US$ 84.7 $542 n/a 0.0% ($0.29) $0.11 $0.53 $0.22 $0.92 $1.89 Dec C$ 327.2 $609 n/a 0.0% ($0.08) ($0.01) $0.09 ($0.05) $0.08 $5.80 Jun US$ 128.9 $736 n/a 0.0% $0.06 $0.42 $0.46 $0.01 $0.00 ($0.02) $0.19 $1.26 $0.08 $1.53 $10.83 Dec US$ 87.7 $935 n/a 0.0% $0.05 $0.90 $1.17 $0.36 $1.56 $1.56 $5.66 Dec US$ 206.7 $1,152 $0.06 1.1% ($0.04) $0.78 $1.10 ($0.03) $1.43 $1.55 7.1x 11.9x 13.6x n/m 58.2x n/m 80.0x $3.10 Dec US$ 393.9 $1,203 n/a 0.0% $0.09 $0.17 $0.22 $0.11 $0.28 $0.32 18.0x $6.60 Dec US$ 278.6 $1,811 $0.04 0.6% $0.36 $0.40 $0.48 $0.54 $0.58 $0.70 16.3x $17.55 Dec US$ 123.2 $2,130 $0.14 0.8% $0.51 $0.61 $1.06 $0.81 $0.91 $1.43 28.3x 16.3x 13.5x 13.9x 5.1x 9.1x 12.4x 20.7x 12.1x 63.0x 3.2x $8.19 Dec C$ 284.3 $2,293 n/a 0.0% $0.36 $0.83 $1.13 $0.81 $1.11 $1.82 9.7x 7.1x $21.78 Dec US$ 107.2 $2,335 $0.10 0.5% $1.06 $2.44 $3.58 $2.02 $3.66 $4.42 8.9x 6.1x 6.0x 7.3x 19.0x 11.2x 10.9x 3.9x 6.8x n/m 23.3x 7.0x 31.5x 3.4x $9.84 Dec C$ 419.0 $4,061 n/a 0.0% n/m $0.05 $1.16 n/m $0.16 $1.49 193.8x 8.4x 60.6x $18.00 Dec US$ 236.4 $4,191 $0.10 0.6% $1.20 $1.66 $2.35 $1.52 $2.03 $2.70 10.7x 7.5x 8.7x $10.08 Dec US$ 473.0 $4,768 n/a 0.0% $0.30 $0.44 $0.45 $0.44 $0.57 $0.73 22.9x 22.4x 17.7x 13.8x 6.6x 6.5x 4.9x 4.4x 12.1x 9.3x 9.5x 3.6x 6.8x n/m 9.8x 5.1x 15.8x 2.1x $38.78 Dec US$ 140.8 $5,378 $0.48 1.2% $0.51 $1.00 $1.25 $1.26 $2.10 $2.32 38.2x 30.6x 18.2x 16.5x $28.96 Dec US$ 358.8 $10,391 $0.36 0.0% $0.74 $1.62 $2.67 $0.91 $1.79 $2.91 17.9x 10.8x 16.2x 10.0x $31.01 $29.36 $10.25 $21.13 $11.62 $36.86 $12.06 $18.36 $8.44 $4.18 $5.15 $15.41 $11.85 $3.33 $7.90 $3.73 $9.03 0.9x 1.3x 1.0x 0.9x 0.8x 0.6x 0.7x 1.0x 0.8x 0.7x 1.1x 0.7x 0.5x 0.6x 0.8x 0.3x 0.4x $45.00 $45.00 $12.00 $23.00 $14.00 $36.00 $13.00 $22.00 $10.00 $5.00 $6.50 $14.00 $9.50 $3.50 $8.00 $3.00 $6.00 55.4% 17.3% 19.0% 28.3% 42.3% 65.7% 58.7% 26.2% 51.5% 61.3% 14.8% 29.3% 63.8% 85.2% 23.1% 134.4% 84.6% BUY HOLD HOLD HOLD HOLD HOLD HOLD BUY HOLD BUY HOLD REDUCE HOLD BUY HOLD BUY BUY HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH SPEC HIGH SPEC HIGH HIGH HIGH HIGH DE GB SG GB DE DE SG SG SG SG SG SG SG DE SG DE SG

Silver Wheaton Corp.(US$)

SLW

Franco-Nevada Corp. (C$) CG

FNV

New Gold Inc. (US$)

NGD

Centerra Gold Inc. (C$)

Osisko Mining Corp. (C$)

OSK

Pan American Silver Corp. (US$) AGI

PAAS, PAA

AuRico Gold Inc. (C$)

AUQ

Alamos Gold Inc. (C$)

SEMAFO Inc. (C$)

SMF

B2Gold Corp. (C$)

BTO

Nevsun Resources Ltd. (C$) IMZ

NSU

Minefinders Corp. Ltd. (C$)

MFL, MFN

International Minerals Corp. (C$)

San Gold Corp. (C$)

SGR

Jaguar Mining Inc. (C$) P

JAG

Lake Shore Gold Corp. (C$)

LSG

Primero Mining Corp (C$)

Developers T T T T T T V T T V T T $0.43 Dec C$ 234.9 $99 n/a $5.89 Dec US$ 35.7 $207 n/a $0.99 Dec C$ 234.5 $229 n/a 0.0% 0.0% 0.0% $2.31 Dec C$ 112.1 $255 n/a 0.0% $2.67 Dec C$ 99.8 $262 n/a 0.0% n/m n/m n/m ($3.72) n/m $1.45 Jun C$ 212.1 $303 n/a 0.0% n/m $7.50 Oct C$ 88.7 $655 n/a 0.0% n/m $7.53 Dec C$ 102.9 $763 n/a 0.0% n/m n/m n/m n/m n/m n/m n/m ($3.40) n/m $7.52 Dec C$ 123.4 $914 n/a 0.0% n/m n/m $3.87 Dec C$ 246.0 $938 n/a 0.0% n/m n/m $17.68 Dec C$ 147.6 $2,570 n/a 0.0% n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m ($0.37) n/m $25.15 Dec C$ 106.5 $2,638 n/a 0.0% n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m ($3.38) n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m ($2.85) n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m $0.01 n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m -1.7x n/m 27.7x n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m -15.7x n/m 13.5x n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m -2.0x n/m 13.1x n/m n/m n/m n/m n/m n/m n/m n/m n/m n/m 580.1x n/m 31.4x $39.50 $27.15 $6.10 $13.12 $14.04 $10.89 $6.30 $8.38 $4.62 $1.87 $17.53 $1.56 0.6x 0.7x 0.6x 0.6x 0.5x 0.7x 0.2x 0.3x 0.5x 0.5x 0.3x 0.3x 0.7x $47.00 $30.00 $6.00 $12.00 $14.00 $10.00 $5.00 $5.00 $3.50 $1.50 $1.00 86.9% Spec BUY SPEC 69.7% Spec BUY SPEC 55.0% Spec BUY SPEC 59.6% Spec BUY SPEC 85.9% Spec BUY SPEC 33.3% 87.3% HOLD HOLD SPEC 244.8% Spec BUY SPEC SPEC 51.5% Spec BUY SPEC 51.5% Spec BUY SPEC $14.00 237.7% Spec BUY SPEC 132.6% 66.4% HOLD SPEC DE DE DE DE DE DE DE DE DE DE DE DE

Detour Gold Corp. (C$)

DGC

Tahoe Resources Inc. (C$)

THO

Rubicon Minerals Corp. (C$) XG

RMX

Continental Gold Ltd. (C$)

CNL

Extorre Gold Mines Ltd. (C$)

Guyana Goldfields Inc. (C$)

GUY

Canaco Resources Inc. (C$)

CAN

Exeter Resource Corp. (C$)

XRC

Lydian International Ltd. (C$)

LYD

Belo Sun Mining Corp. (C$)

BSX

Golden Minerals Co. (C$)

AUM

Shore Gold Inc. (C$)

SGF

Average

Service Universe
Overall Curr. Exch. T V T $2.30 Dec C$ $4.56 Dec C$ $15.54 Apr C$ 79.6 46.5 43.9 Price End Curr. O/S (mm) YearRep. Shares Mkt Cap (US$ mm) $1,218 $209 $99 Ind. Div. $0.16 $0.00 $0.00 Yield 1.0% 0.0% 0.0% 2010A $0.03 $0.04 $0.16 EPS 2011E $0.38 $0.37 $0.27 2012E $1.30 $0.58 $0.39 2010A $0.43 $0.09 $0.39 CFPS 2011E $0.84 $0.52 $0.46 2012E $1.98 $0.82 $0.62 P/E (x) 2011E 41.1x 12.3x 8.5x 2012E 12.0x 7.8x 5.8x P/CF (x) 2011E 18.5x 8.7x 4.9x 2012E 7.9x 5.6x 3.6x NAVPS $22.93 P/NAV 0.7x 12-Mo Target $24.00 $6.00 $4.50 Total Return 55% 32% 96% Rating BUY BUY BUY Risk Rating Analyst HIGH HIGH HIGH SG SP SP

Stock Name

Symbol

Major Drilling Group Intl Inc. (C$)

MDI

Energold Drilling Corp. (C$)

EGD

Geodrill Ltd. (C$)

GEO

AL BUY = Action List BUY Analyst(s): SG = Steven J. Green, CFA 416 307 6304; GB = Greg Barnes 416 983 9588; DE = Daniel Earle, 416 308 7906; SP = Scott Parsons, 416 308 3404

55

Industrial Products
1,250 1,050 850 650 450 250 50 Dec00 Dec01 Dec02 Dec03 Dec04 Dec05 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. 2.2 1.8 (1.7) 3M 16.5 15.1 3.6 6M 7.3 (10.3) (8.9) 12M 7.3 (6.8) (8.7) YTD 7.3 (6.8) (8.7) Cum .1 625.4 233.8 72.5

* S&P/TSX Construction & Engineering, Machinery, Trading Co's & Distributors (Industries) Since December 29, 2000

Action List

Comp Group*

S&P/TSX

Michael Tupholme, CFA, 416 307 9389 michael.tupholme@tdsecurities.com Cherilyn Radbourne, CA, CFA 416 308 3403 cherilyn.radbourne@tdsecurities.com Tim James, CFA, 416 308 9773 tim.james@tdsecurities.com Paul DAmico, CFA 416 983 2755 paul.damico@tdsecurities.com

Industry Overview
Performance Summary for the Month Armtec Infrastructure Inc. (ARF-T) was the strongest performer in our coverage universe in December, up 39.5%. Finning International Inc. (FTT-T), down 4.8%, was the worst. Russel Metals Inc.s (RUS-T) stock price decreased by 4%. The HRC spot price is US$695/ton for February deliveries, up almost 9% from the US$640/ton November average. The HRC price has shown noticeable improvement, as we expected, given recently announced price increases and lengthening order lead times. Russel BUY-rating unchanged, and near-term trading looks positive. As investor sentiment for steel equities closely follows the direction of the benchmark HRC price, near-term trading for Russel is likely to be positive. As well, we believe that its dividend is safe due to a strong balance sheet and a healthy free cash flow cushion, which should provide stock price support in the longer term. Our BUY rating is unchanged. Steels: The November 2011 U.S. steel inventory dropped to 8.10 million tons, about 3.3% lower than the 8.38 million tons in October, but still 11% higher year over year. We are not surprised to see some destocking through November, with the aggressive liquidation selling evident since June, and the benchmark HRC price hitting a low of US$600/ton in November confirming that. However, spot transaction pricing has improved to US$695/ton, with potentially more room to move up, given that list price is currently US$720740/ton. Things to Watch For in the Coming Month January 9: Canadian Building Permits January 18: Architectural Billings Index January 26: Caterpillar Inc.s (CAT-N) Q4/11 results

56

Our Sector Stance Engineering and Construction: Our longer-term macro outlook for this sector is generally favourable. We believe public-sector spending trends remain positive, supported by P3s and megaprojects, which are important segments for the companies that we cover. With governments looking to tackle record fiscal deficits, we expect spending to be down substantially from the peaks during the stimulus program. However, infrastructure spending levels can nonetheless be expected to be strong on a historical basis. Looking forward, 2012-2013 is expected to be the first full post-stimulus year, with budgeted infrastructure spending above the last pre-stimulus year (2008-2009). In terms of the private sector, we are encouraged by the improved level of new contract awards over the last few quarters. However, given the prospect of slower than previously forecast economic growth, there is admittedly increased uncertainty surrounding the potential for continued private sector gains. A number of companies in our coverage universe have exposure to industrial markets, including oil & gas and mining markets. At this point, activity levels in these end markets, which have improved since the last downturn, appear to be holding up well, though falling commodity prices pose a risk. Commercial markets have not fully recovered since the last downturn. Strong commercial permit readings during May through July have given us reason to be optimistic, although permit values have slipped back since then, with October representing a six-month low. Residential permit values have been steady over the past several months, well above levels recorded in 2009 although October also represented a six-month low. Looking forward, TD Economics is forecasting that housing starts will decline modestly in 2012, and more substantially in 2013. In general, margin compression has been a noteworthy theme for the E&C sector over the last several quarters. For several companies that we cover, recent margin performance has been well below previous highs, driven largely by a more negative mix of work. In the short term, we generally expect margins to remain weaker. However, at this point, our forecasts continue to call for margins of most companies that we cover to gradually rise over the coming quarters, as they work off weaker-margin projects awarded during the downturn, and begin to derive a greater proportion of revenue from more recently awarded work.

SNC-Lavalin Group Inc.

(SNC-T, $51.08); 12-Month Target C$69.00 Michael Tupholme, CFA 416 307 9389 While SNC-Lavalin reported Q3/11 core EPS in line with our estimate, core earnings fell 7% short of Street expectations. Despite the shortfall versus consensus, we remain positive on its outlook, on account of 1) overall backlog strength and a favourable backlog mix (we estimate that it has an all-time high level of gross margin embedded in backlog); 2) a healthy level of awarded work that has not yet been included in backlog; and 3) what appears to be a robust opportunity pipeline for new awards across most segments. We reiterate our Action List BUY recommendation.

57

58
Curr. Symbol SNC RME BOS ATA WJX FTT BDT STN IBG ARE RUS GNV TIH ARF CUQ RBA T,N $22.08 Dec US$ 106.9 $2,360 $0.45 2.0% $0.61 $0.72 $1.03 30.7x 21.4x T $11.43 Dec C$ 24.3 $278 $0.48 4.2% $1.98 $0.96 $1.86 11.9x 6.1x T $2.05 Dec C$ 24.1 $49 $0.00 0.0% $0.06 ($9.08) ($0.47) nmf nmf $3.00 $15.50 $21.00 T $21.32 Dec C$ 77.2 $1,646 $0.44 2.1% $1.31 $1.38 $1.44 15.4x 14.8x $24.00 T $26.32 Dec C$ 32.6 $857 $1.50 5.7% $1.79 $1.95 $1.70 13.5x 15.5x $30.00 T $22.42 Dec C$ 67.0 $1,502 $1.20 5.4% $1.16 $1.86 $1.86 12.1x 12.1x $26.00 21% 20% 15% 46% 40% -3% T $10.46 Dec C$ 53.2 $557 $0.20 1.9% $0.53 $0.43 $0.82 24.2x 12.7x $13.00 26% T $13.20 Dec C$ 18.0 $238 $1.10 8.4% $3.21 $0.84 $1.44 15.8x 9.1x $16.00 30% T,N $27.57 Dec C$ 45.4 $1,251 $0.00 0.0% $2.00 $2.29 $2.56 12.0x 10.8x $36.00 31% BUY BUY BUY BUY BUY BUY HOLD HOLD HOLD T $11.53 Dec C$ 42.2 $486 $0.66 5.7% $1.12 $0.70 $1.29 16.6x 8.9x $14.50 31% BUY T $22.21 Dec C$ 172.2 $3,825 $0.52 2.3% $1.12 $1.46 $1.95 15.2x 11.4x $29.00 33% BUY T $38.56 Dec C$ 16.6 $641 $2.40 6.2% $3.26 $3.71 $3.50 10.4x 11.0x $51.00 38% BUY MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM HIGH MEDIUM MEDIUM MEDIUM SPECULATIVE MEDIUM MEDIUM T $6.45 Mar. C$ 87.8 $566 $0.00 0.0% $0.11 $0.42 $0.58 15.3x 11.2x $9.00 40% BUY HIGH T $4.85 Dec C$ 23.6 $115 $0.15 3.0% $0.62 $0.64 $0.68 7.6x 7.1x $7.00 47% BUY HIGH T $8.88 Dec C$ 22.6 $200 $0.18 2.0% $0.83 $1.25 $1.43 7.1x 6.2x $13.50 54% BUY HIGH T $51.08 Dec C$ 150.9 $7,707 $0.84 1.6% $2.79 $2.95 $3.55 17.3x 14.4x $69.00 37% AL BUY MEDIUM Q3/11 Q3/11 Q3/11 Q2/12 Q3/11 Q3/11 Q3/11 Q3/11 Q3/11 Q3/11 Q3/11 Q3/11 Q3/11 Q3/11 Q3/11 Q3/11 Exch. Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011E 2012E 2011E 2012E Target Return Rating Risk Rating LRQ YearRep. Shares Market Ind. EPS Overall Analyst MT CR TJ CR MT CR MT MT MT MT PD MT CR MT MT CR P/E

Industrial Products Universe

Stock Name

SNC-Lavalin Group Inc.

Rocky Mountain Dealerships Inc.

AirBoss of America (1)

ATS Automation Tooling Systems Inc.

Wajax Corp.

Finning International Inc.

Bird Construction Inc.

Stantec Inc.

IBI Group Inc.

Aecon Group Inc.

Russel Metals Inc.

Genivar Inc.

Toromont Industries Ltd.

Armtec Infrastructure Inc.

Churchill Corporation

Ritchie Bros. Auctioneers Inc.

(1) All figures are in U.S. dollars.

AL BUY = Action List BUY Analyst(s): MT = Michael Tupholme, CFA, 416 307 9389; CR = Cherilyn Radbourne, CA, CFA, 416 308 3403; TJ = Tim James, CFA, 416 308 9773; PD = Paul DAmico, CFA 416 983 2755

Insurance
200 150 100 50 Dec00 Dec01 Dec02 Dec03 Dec04 Dec05 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Action List Com p. Group* S&P/TSX Com p. 1M 0.0 2.7 (1.7) 3M 0.0 (5.6) 3.6 Total Return % 6M 0.0 (21.4) (8.9) 12M 0.0 (20.9) (8.7) YTD 0.0 (20.9) (8.7) Cum .1 75.7 (0.1) 72.5

* S&P/TSX Insurance (Industry Group) Since December 29, 2000

Action List

Comp Group*

S&P/TSX

Doug Young, CFA 416 308 2361 doug.young@tdsecurities.com

Industry Overview
Performance Summary for the Month In the Lifeco sector, our group of four companies appreciated on average 1.2% in December, led higher by Great-West Lifeco (GWO-T) and Sun Life Financial (SLF-T) with gains of 4.3% and 2.4%, respectively, while Industrial Alliance (IAG-T) and Manulife Financial (MFC-T) declined by 0.5% and 1.3%. For context, the Lifecos, as a group, outperformed the S&P/TSX Composite, which was down 1.7%, but underperformed the S&P/TSX Capped Financials Index which gained 2.5%. Intact Financial Corp. (IFC-T) gained 2.9% on the month. Things to Watch For in the Coming Month Two themes to focus on in the near term for lifecos is the impact from 1) development around IFRS phase II, and 2) regulatory capital rule changes. On the P&C side, we continue to pay close attention to the development around fraud and abuse in Ontario Auto insurance, and Ontario Auto Reform overall. Sector Stance Over the next 12 to 24 months, the Lifecos may provide decent returns; however, we expect a bumpy ride over the near term. We remain market weight on the sector. In terms of potential positives, rising interest rates and equity markets could provide a good footing for the sector. As well, if macro conditions stabilize, we could see a re-rating of the sector on the back of reduced earnings volatility and a steady build up of excess capital. We believe the sector is under-owned; therefore, if we do get a rotation back in, it could add a further push to Lifeco stock prices. Lastly, Lifecos have been raising prices and scaling back features offered on certain products, which we believe should help boost new business margins. However, current macro conditions will weigh on the Lifecos share prices near term. Some legacy businesses cannot be re-priced and will likely weigh on earnings and ROEs for years. We are also awaiting clarity on what high level

59

changes OSFI might make to Lifeco regulatory capital requirements (and when). The eventual adoption of IFRS Phase 2 remains an overhang for the sector as well. The P&C sector is cyclical, and while the pricing signals are mixed currently, we anticipate a hardening (increasing) pricing environment in 2012, primarily in the personal (not commercial) market. As well, P&C insurers have historically held up relatively well in challenging macro conditions. Meanwhile, we are encouraged by the steps laid out in the recent Ontario budget to combat auto insurance fraud and abuse. We favour companies with a strong management team, reserving track record, solid capital position, and leading market share, such as Intact Financial. But, in our view, its stock is fairly valued at current levels.

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Insurance Universe
Overall Curr. Symbol SLF MFC GWO IFC IAG T $26.29 Dec C$ 90.2 $2.4 $0.98 3.7% $2.84 $3.15 9.3x 8.3x $35.00 36.9% T $58.53 Dec C$ 129.6 $7.6 $1.48 2.5% $3.74 $5.21 15.6x 11.2x $64.00 11.9% T $20.40 Dec C$ 949.6 $19.4 $1.23 6.0% $1.94 $2.10 10.5x 9.7x $24.00 23.7% T, N $10.85 Dec C$ 1793.5 $19.5 $0.52 4.8% $0.68 $1.45 nmf 7.5x $17.00 61.5% BUY HOLD HOLD HOLD T, N $18.90 Dec C$ 582.8 $11.0 $1.44 7.6% $0.06 $2.45 nmf 7.7x $29.00 61.1% BUY Exch. Price End Curr. O/S (mm) Cap (bln) Div. Yield 2011E 2012E 2011E 2012E Target Return Rating YearRep. Shares Market Ind. EPS P/E 12-Month Total Risk Rating MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM Analyst DY DY DY DY DY

Stock Name

Sun Life Financial Inc.

Manulife Financial Corp.

Great-West Lifeco Inc.

Intact Financial Corp. (1)

Industrial Alliance Ins. & Fincl Svcs Inc.

(1) EPS are on an operating basis, which exclude after-tax realized investment gains.

AL BUY = Action List BUY Analyst(s): DY = Doug Young, CFA 416 308 2361

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Media
1,000 800 600 400 200 0 Dec00 Dec01 Dec02 Dec03 Dec04 Dec05 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. 8.8 0.5 (1.7) 3M 5.1 (0.7) 3.6 6M (3.7) (23.8) (8.9) 12M (1.6) (32.2) (8.7) YTD (1.6) (32.2) (8.7) Cum .1 547.8 (24.9) 72.5

* S&P/TSX Broadcasting, Publishing (Subindustries) Since December 29, 2000

Action List

Comp Group*

S&P/TSX

Scott Cuthbertson 416 983 3954 scott.cuthbertson@tdsecurities.com Michael Elkins, CA, CFA 416 983 6809 michael.elkins@tdsecurities.com

Industry Overview
Performance Summary for the Month Our Action List performed well in December, gaining 8.8% versus the comp group and the S&P/TSX Composite, which were up 0.5% and 1.7%, respectively. The performance of our Action List was driven by our lone pick, Corus Entertainment. While there was little news from the company during the month, we believe that the market is becoming more comfortable that the OTT threat is better defined and less worrisome than it was earlier in the year, helping to restore confidence on this front. Things to Watch For in the Coming Month January brings Q1 results from most of the companies in our coverage with fiscal year ends, including Corus, Canadian Satellite Radio and Postmedia. We will have a preview report out on these names in early January with detail, but are generally looking for a stronger H2/12 than H1/12, and therefore expect some of the pressure we saw on certain media verticals in Q4 to continue. We publish our annual industry report in January, and host the Taste of Media Luncheon to accompany that. This will be later in the month than usual this year, due to the timing of the holidays and reporting season. Stay tuned for more detail and personal invitations to the event. Our Sector Stance: Overweight Most media companies have some exposure to the advertising market, which is, in turn, driven by the overall economy. We remain upbeat about some advertising demand metrics online and specialty television, in particular. Other media, such as print, are definitely more challenged at this point in the cycle. Accordingly, we believe that investors should focus more on stock specific ideas than sector rotation when it comes to media. Our top pick, Corus Entertainment, is a case in point, with lots of exposure to both specialty television and radio, two components of the advertising economy that are faring much better than others.

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Corus Entertainment Inc.

CJR.B-T, $20.52) 12-Month Target :$24.00 Scott Cuthbertson 416 983-3954 Corus is our Action List pick for several reasons: Solid business fundamentals. Corus has good exposure to specialty television, which is one of the healthiest components of the advertising market. We expect it to grow in the mid to high single digit range this year. A good radio franchise and valuable content operation round out the companys asset stable. Strong balance sheet. Levered at 1.9x, Corus has significant financial flexibility. An attractive and potentially growing dividend. Corus currently pays $0.87 in annual dividends, and we believe it is poised to increase this, as free cash flow has grown nicely over the last year. With the companys AGM slated for January 10, there could be an announcement on this front as early as that date. Netflix threat has abated. With the signing of the NBCUniversal output deal, Corus does not have any more pay TV content renewals until 2013. In addition, we expect significant innovation on the pay television front some time in calendar 2012, which may help to underpin that business and grow the revenue base. We like the overall momentum, valuation and relative defensiveness of the mix of media properties in the stable. Action List BUY.

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64
Overall Curr. Exch. $20.52 $35.49 $8.77 $7.97 $3.20 Aug C$ 122.9 $393 $0.00 0.0% ($0.88) ($0.84) $0.24 ($11.2) ($7.3) $48.4 nm 13.4x nm 10.7x $4.50 40.6% Dec C$ 30.3 $241 $0.30 3.8% $0.38 $0.51 $0.65 $27.6 $33.3 $37.8 15.8x 12.2x 10.5x 7.6x $9.00 16.7% Dec C$ 23.8 $208 $0.20 2.3% $1.72 $1.45 $1.13 $76.2 $65.6 $57.8 6.1x 7.8x 3.9x 5.1x $11.00 27.7% HOLD HOLD BUY Aug C$ 56.6 $2,007 $0.75 2.1% $3.08 $3.25 $3.55 $305.7 $319.3 $336.8 10.9x 10.0x 7.9x 7.4x $41.00 17.6% BUY Aug C$ 82.9 $1,700 $0.75 3.7% $1.56 $1.69 $1.84 $261.6 $287.5 $303.2 12.2x 11.2x 7.8x 7.4x $24.00 20.6% AL BUY T T T T Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011A/E 2012E 2010A 2011A/E 2012E 2011A/E 2012E 2011A/E 2012E Target Return Rating Rating MEDIUM MEDIUM MEDIUM MEDIUM HIGH YearRep. FD Shares Market Ind. EPS EBITDA ($mm) P/E (x) EV/EBITDA (x) 12-Month Total Risk Analyst SC SC SC SC SC

Broadcasting Universe

Stock Name

Symbol

Corus Entertainment Inc.

CJR.B, CJR T, N

Astral Media Inc.

ACM.A

TVA Group Inc.

TVA.B

Newfoundland Capital Corp. Ltd.

NCC.A

Canadian Satellite Radio Holdings

XSR

Publishing Companies
Overall Curr. Exch. T T T T $7.40 Aug C$ 40.3 $298 $0.00 0.0% na $1.13 $1.20 $191.1 $201.1 $180.4 6.5x $2.10 Dec. C$ 89.4 $188 $0.06 2.9% $0.28 $0.23 $0.35 $44.1 $50.8 $69.5 9.0x 6.0x 6.2x $0.19 Dec C$ 516.1 $95 $0.00 0.0% $0.94 $0.59 $0.62 $850.3 $694.0 $617.8 0.3x 0.3x $8.28 Dec. C$ 80.1 $664 $0.50 6.0% $1.60 $1.69 $1.72 $250.3 $238.8 $243.0 4.9x 4.8x Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011E 2012E 2010A 2011E 2012E 2011A/E 2012E 2011E 3.2x 3.8x 6.3x 4.7x YearRep. Shares Market Ind. EPS EBITDA ($mm) P/E (x) EV/EBITDA (x) 2012E 3.1x 4.3x 4.0x 4.9x 12-Month Target $14.00 na $2.75 $10.00 Total Return 75.1% na 33.8% 35.1% Rating BUY REDUCE BUY HOLD Risk Rating MEDIUM HIGH MEDIUM HIGH Analyst SC SC SC SC

Stock Name YLO

Symbol

Torstar Corp.

TS.B

Yellow Media Inc.

Glacier Media

GVC

Post Media Network

PNC.B

Printing Companies
Overall Curr. Exch. T T $14.34 Dec. US$ 47.2 $677 $0.00 0.0% na $2.17 $2.34 $683.7 $615.0 $12.61 Oct C$ 81.0 $1,021 $0.44 3.5% $1.89 $1.36 $2.17 $382.0 $378.1 Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011A/E 2012E 2010A 2011A/E YearRep. Shares Market Ind. EPS EBITDA ($mm) 2012E $399.1 $607.9 9.2x 6.6x P/E (x) 2011A/E 2012E 5.8x 6.1x EV/EBITDA (x) 2011A/E 4.3x 3.9x 2012E 4.0x 3.9x 12-Month Target $15.00 $15.00 Total Return 22.4% 4.6% Rating BUY HOLD Risk Rating MEDIUM HIGH Analyst SC SC

Stock Name

Symbol

Transcontinental Inc

TCL.A

QUAD Graphics

QUAD

Film Companies
Overall Curr. Exch. T $25.72 Dec C$ 62.7 $1,612 $1.29 5.0% $1.15 $1.10 Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011E YearRep. Shares Market Ind. EPS 2012E $1.41 2010A $171.3 EBITDA ($mm) 2011E $177.6 2012E $192.4 P/E (x) 2011E 23.3x 2012E 18.2x EV/EBITDA (x) 2011E 10.2x 2012E 9.4x 12-Month Target $25.00 Total Return 2.2% Rating HOLD Risk Rating MED Analyst ME

Stock Name

Symbol

Cineplex Inc

CGX

Production Companies
Overall Curr. Exch. T $0.73 Jun C$ 61.0 $45 Price End Curr. O/S (mm) Cap (mm) Div. $0.00 YearRep. Shares Market Ind. Yield 0.0% 2010A ($0.01) EPS 2011A $0.03 2012E $0.05 2010A $2.9 EBITDA ($mm) 2011A $6.8 2012E $8.7 P/E (x) 2011A 26.9x 2012E 15.8x EV/EBITDA (x) 2011A 4.4x 2012E 3.5x 12-Month Target $1.00 Total Return 37.0% Rating HOLD Risk Rating HIGH Analyst ME

Stock Name

Symbol

DHX Media Ltd.

DHX

AL BUY = Action List BUY Analyst(s): SC = Scott Cuthbertson 416 983 3954; ME = Michael Elkins, CA, CFA 416 983 6809

Metals & Minerals

400 300 200 100 0 Jan06 Jul06 Jan07 Jul07 Jan08 Jul08 Jan09 Jul09 Jan10 Jul10 Jan11 Jul11 Action List Com p. Group* S&P/TSX Com p. 1M (2.6) (2.1) (1.7) 3M 30.9 27.2 3.6 Total Return % 6M (26.2) (24.2) (8.9) 12M (26.8) (29.0) (8.7) YTD (26.8) (29.0) (8.7) Cum .1 (7.9) 154.0 20.2

* S&P/TSX Div. Metals & Minerals, Aluminum (Subindustries) Since January 23, 2006

Action List

Comp Group*

S&P/TSX

Greg Barnes, 416 983 9588 greg.barnes@tdsecurities.com Craig Miller, 416 982 2753 craig.miller@tdsecurities.com Steven J. Green, CFA 416 307 6304 steven.green@tdsecurities.com Craig Hutchison, 416 982 3474 craig.hutchison@tdsecurities.com

Industry Overview
Performance Summary for the Month The S&P/TSX Div. Metals & Minerals, Aluminum (Subindustries) was down 2.1% in December, after being down 2.8% in November. In December, First Quantum Minerals Ltd. (FM-T) was the best performer among the large cap producers, with a negative 2.7% return, while Cameco Corp. (CCO-T, CCJ-N) was the weakest, with a negative 4.7% return. Among the small to intermediate cap producers, Quadra FNX Mining Ltd. (QUX-T) performed best with a 36.5% return, while Mercator Minerals (ML-T) trailed at negative 17.5%. Among the developers, Macarthur Minerals Ltd. (MMS-T) was the best performer with a 2.8% return, while Nautilus (NUS-T) was the weakest, with a negative 20.7% return. Things to Watch For in the Coming Month We expect continued volatility in commodity prices in the coming months, as investors grapple with concerns related to the debt crises in Europe and the U.S. However, investors should begin to be more forward-looking and focus on an improving demand outlook, as well as the fundamental outlook for metals entering 2012. We believe that the supply challenges facing mining companies have been intensified by the events of the past several years, which is likely to lead to continued strength in metal prices longer term, as the supply response lags structurally higher demand. As well, increased inflation pressures dogging new project development are expected to be a significant factor behind the sustainability of elevated metal prices. Our Sector Stance Our long-term view remains bullish, and we recommend an overweight in the sector. We see structurally higher demand over the long term, driven by urbanization and modernization in the developing world. Mine production will likely struggle to meet higher structural demand. In fact, Brook Hunt forecasts suggest that mine production could decline over the next 15 years, particularly that of zinc and copper. We believe that 1) developing world industrialization and urbanization will continue to drive metal-intensive demand; 2) the global financial crisis has resulted in a two-year delay (at least) in the progress of new projects; and

65

3) increasing sovereign risks could further hamper the mining industrys ability to respond to higher metal prices.

Teck Resources Ltd.

(TCK.B-T, $35.91) 12-Month Target: $58.00 Greg Barnes, 416 983 9588 Our two favourite commodities are coking coal and copper, both key focuses for Teck Resources, which is our large cap Action List pick in the base metals sector. We expect Teck to potentially benefit from strong pricing for those two commodities in 2012 and beyond. We are, however, more bullish on copper, given strong Asian demand and potential supply challenges over the medium and longer term. There is increasing concern that copper supply will be constrained over the medium term, as a lack of projects in the development pipeline has been exacerbated by the global financial crisis. Over the long term, the lack of highquality, large-scale copper projects could drive up the marginal cost of production, and, in turn, lead to higher copper prices. We are valuing Teck based upon target multiples of 6.0x our EV/2012 EBITDA estimate (60% weighting) and 1.3x our net asset value (40% weighting). We believe that Tecks strong growth profile, low technical and political risk profile and substantial free cash flow make it a core investment in the Canadian base metals sector.

First Quantum Minerals Ltd.

(FM-T, $20.05) 12-Month Target: $27.00 Greg Barnes, 416 983 9588 We believe First Quantum has the potential to be a 1 million tonnes per year (tpy) copper producer. With the Sentinel project rapidly emerging as a world-class copper discovery, and plans for a 67% production increase at Kansanshi, we believe that First Quantum has the necessary projects to become the next global major copper producer, with production of 1 million tpy, i.e., over three times 2011 production of approximately 300,000 tons, being possible by 2017. Our target price is based upon an EV/2012E EBITDA multiple of 5.0x (60% weighting) and a 1.30x multiple to our NAV10% (40% weighting). We believe that First Quantums suite of large copper projects, its commanding position on the Zambian Copperbelt, and its diversified asset base, could move it to the top of the acquisition target list for any major mining company or state mining company seeking to position itself as a significant participant in the copper market.

66

Metals & Minerals Universe

Overall Curr. Symbol FM TCK.B, TCK CCO, CCJ CS CMK DML, DNN HBM III IMN LUN ML QUX TKO, TGB TCM, TC T, N $7.12 Dec. 31 US$ 167.9 1,195 n/a $1.12 $0.76 $0.54 $1.62 $1.27 $1.03 9.0x 12.8x T, A $2.79 Dec. 31 C$ 195.4 545 n/a $0.50 $0.18 $0.31 $0.57 $0.12 $0.41 15.2x 9.0x T $15.08 Dec. 31 US$ 192.8 2,907 n/a $1.41 $0.83 $1.01 $2.16 $1.61 $1.56 17.6x 14.5x T $1.51 Dec. 31 US$ 258.4 390 n/a $0.10 $0.03 $0.28 $0.14 $0.12 $0.36 45.0x 5.3x 12.2x 9.1x 23.6x 5.4x T $3.87 Dec. 31 US$ 583.4 2,258 n/a $0.55 $0.32 $0.23 $0.52 $0.34 $0.45 11.7x 16.0x 10.9x T $65.50 Dec. 31 C$ 69.3 4,541 0.3% $5.53 $4.23 $5.73 $7.44 $5.79 $6.81 15.5x 11.4x 11.3x 9.6x 8.3x 4.1x 9.4x 6.7x 6.7x T $12.50 Dec. 31 C$ 74.0 925 n/a $1.35 $1.00 $0.76 $1.89 $2.08 $1.18 12.5x 16.5x 6.0x 10.6x T $10.14 Dec. 31 C$ 171.9 1,743 2.0% $0.50 $0.73 $0.21 $1.32 $1.14 $0.84 13.9x 48.4x 8.9x 12.1x T, A $1.27 Dec. 31 US$ 384.7 489 n/a ($0.06) ($0.12) ($0.09) $0.12 ($0.00) $0.03 n/a n/a n/a n/a $1.50 $12.50 $15.50 $80.00 $5.00 $3.75 $17.00 $6.00 $11.00 T $1.61 Nov. 30 C$ 208.6 336 n/a ($0.09) ($0.02) $0.15 ($0.03) ($0.02) $0.23 n/a 10.9x n/a 6.9x $2.75 T $2.78 Dec. 31 US$ 375.0 1,043 n/a $0.24 $0.19 $0.21 $0.38 $0.44 $0.33 14.3x 13.0x 6.1x 8.1x $4.75 71% 71% 18% 25% 24% 22% 29% 148% 13% 115% 54% T, N $18.41 Dec. 31 C$ 395.4 7,279 2.2% $1.28 $1.04 $1.28 $1.97 $1.72 $1.80 17.7x 14.4x 10.7x 10.2x $29.00 60% T, N $35.91 Dec. 31 C$ 590.8 21,216 2.2% $2.72 $4.36 $4.30 $4.66 $7.50 $7.04 8.2x 8.3x 4.8x 5.1x $58.00 64% BUY BUY Spec BUY HOLD HOLD BUY BUY BUY BUY HOLD BUY BUY T $20.05 Dec. 31 US$ 476.3 9,550 0.8% $1.40 $1.31 $1.35 $2.24 $1.83 $2.32 15.0x 14.7x 10.8x 8.5x $27.00 35% AL BUY AL BUY Exch. Price End Curr. O/S (mm) Cap (mm) Yield 2010A 2011E 2012E 2010A 2011E 2012E 2011E 2012E 2011E 2012E Target Return Rating YearRep. Shares Market Ind. EPS CFPS P/E (x) P/CF (x) 12-Mth Total Risk Rating Analyst HIGH HIGH HIGH HIGH SPEC SPEC HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH GB GB GB CM CH CM GB CM GB GB CM GB CM CM

Stock Name

Large cap.

First Quantum Minerals Ltd.

Teck Resources Ltd.

Cameco Corp.

Intermediate-Small Cap.

Capstone Mining Corp.

Cline Mining Corporation

Denison Mines Corp.

HudBay Minerals Inc.

Imperial Metals

Inmet Mining Corp.

Lundin Mining Corp.

Mercator Minerals

Quadra FNX Mining Ltd.

Taseko Mines Ltd.

Thompson Creek Metals

Developers AZC ETG, EGI IVN MMS NUS NDM, NAK T, A $6.15 Dec. 31 C$ 95.0 584 n/a ($0.15) ($0.20) ($0.08) ($0.07) ($0.07) T $1.80 Dec. 31 US$ 195.7 352 n/a ($0.26) ($0.14) ($0.07) ($0.26) ($0.13) T, $1.12 Mar. 31 AUD$ 44.8 50 n/a n/a ($0.10) ($0.07) n/a ($0.07) T, N $18.09 Dec. 31 US$ 711.0 12,862 n/a ($0.05) ($0.76) ($0.18) ($0.11) ($0.29) ($0.18) ($0.06) ($0.07) ($0.08) T, A $1.25 Dec. 31 US$ 114.8 144 n/a ($0.19) ($0.14) ($0.06) ($0.16) ($0.17) ($0.06) T, A $3.17 Dec. 31 US$ 143.8 456 n/a ($0.04) $0.10 ($0.04) ($0.04) ($0.04) $0.07 30.1x n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a 42.2x n/a n/a n/a n/a n/a $7.00 $3.50 $18.50 $3.00 $3.00 $38.00 121% 180% 2% 168% 67% 518% Spec BUY Spec BUY HOLD Spec BUY HOLD Spec BUY SPEC SPEC SPEC SPEC SPEC SPEC CM CM CM CM CM CM

Augusta Resource Corp.

Entre Gold Inc.

Ivanhoe Mines Ltd.

Macarthur Minerals Ltd.

Nautilus Minerals

Northern Dynasty Minerals Ltd.

Metals Income Trust Universe

Overall Curr. Symbol NIF.UN WTE.UN T $22.88 Dec. 31 C$ 74.3 $1,699 9.0% $1.25 T $5.68 Dec. 31 C$ 50.0 $284 8.8% $0.56 Exch. Price End Curr. O/S (mm) Cap (mm) Yield 2010A 2011E $0.71 $0.52 YearRep. Shares Market Ind. EPU 2012E $0.79 $0.58 2010A $1.04 $0.00 DCPU 2011E $0.86 $1.20 2012E $0.83 $1.11 P/EPU (x) 2011E 8.0x 43.6x 2012E 7.2x 39.4x P/DCPU (x) 2011E 6.6x 19.1x 2012E 6.8x 20.7x 12-Mth Target $8.00 $20.00 Total Return 50% -5% Rating BUY HOLD Risk Rating Analyst HIGH HIGH SG GB

Stock Name

Noranda Income Fund

Westshore Terminals

TDSI Metal Price Forecasts (US$/lb)

2004A $0.78 $1.30 $0.40 $6.29 $0.48 $18.27 $0.78 $0.84 $0.88 $0.93 $28.08 $47.91 $98.54 $63.83 $0.94 $0.63 $1.48 $1.47 $0.85 $6.71 $10.96 $16.87 $9.60 $0.44 $0.58 $1.77 $0.95 $0.78 $6.66 $0.75 $46.80 $0.88 $1.67 $3.06 $3.23 $3.16 $2.34 $0.86 $1.17 $1.20 $1.17 $0.76 2005A 2006A 2007A 2008A 2009A 2010A $0.99 $3.43 $0.98 $9.93 $0.98 $46.48 $0.98 2011A $0.93 $4.00 $1.09 $10.38 $0.99 $57.10 $1.01 2012E $0.90 $3.75 $1.00 $8.75 $0.95 $62.50 $1.00

TDSI Metal Price Forecasts (US$/lb)

Aluminum

Copper

Lead

Nickel

Zinc

Uranium

C$/US$

AL BUY = Action List BUY Analyst(s): GB = Greg Barnes, 416 983 9588; SG = Steven Green, CFA 416 307 6304; CM = Craig Miller, 416 982 2753; CH = Craig Hutchison, 416 982 3474

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Multi-Industry
200 180 160 140 120 100 80 Mar11 Dec08 Dec09 Dec10 Sep09 Sep10 Dec11 Mar10 Mar09 Jun09 Jun10 Jun11 Sep11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. 0.0 0.8 (1.7) 3M 0.0 2.4 3.6 6M 0.0 (1.8) (8.9) 12M 0.0 5.4 (8.7) YTD 0.0 5.4 (8.7) Cum .1 0.0 87.3 49.8

* S&P/TSX Diversified Financials, Real Estate & Utilities (Industry Groups) Since December 16, 2008

Action List

Comp Group*

S&P/TSX

Linda Ezergailis, P. Eng. 416 983 7784 linda.ezergailis@tdsecurities.com Jason Bilodeau, CFA 416 308 3741 jason.bilodeau@tdsecurities.com Cherilyn Radbourne, CA, CFA 416 308 3403 cherilyn.radbourne@tdsecurities.com

Industry Overview
Performance Summary for the Month In December, on average, our multi-industry coverage group outperformed the S&P/TSX Composite, which decreased by 1.7%. In particular, Brookfield Asset Management Inc. (BAM) decreased by 0.9%, and Brookfield Infrastructure Partners L.P. (BIP) increased by 8.0%. Meanwhile, Onex Corp. decreased by 4.9%. Things to Watch For in the Coming Month We will continue to watch how the broader economic environment unfolds and the impact on various industries and sectors worldwide. Signs of improvement in economic conditions and the health of capital markets should support improved business performance and transaction activity.

68

Multi-Industry Universe
Overall Curr. Exch. T, N $27.48 Dec US$ 658.2 $18,087.3 $0.52 1.9% $25.19 1.1 $1.61 $1.50 $1.48 $2.06 17.1x 18.3x 18.6x 13.4x $32.00 18.3% BUY Price End Curr. O/S (mm) Cap (mm) Div. Yield Value P/BV 2009A 2010A 2011E 2012E 2009A 2010A 2011E 2012E Target Return Rating YearRep. Shares Market Ind. Book AOCF Per Share P/AOCF 12-Month Total Risk Rating MEDIUM Analyst LE

Stock Name

Brookfield Asset Management Inc.

Symbol BAM.A, BAM

Overall Curr. Exch. N, T $27.70 Dec US$ 185.1 $5,127.3 $1.40 5.1% $1.32 4.8% $1.70 $2.30 $2.37 $2.82 16.3x 12.0x 11.7x 9.8x $30.00 Price End Curr. O/S (mm) Cap (mm) Dist. Yield 2011E Yield 2009A 2010A 2011E 2012E 2009A 2010A 2011E 2012E Target YearRep. Units Market Ind. Dist. FFO Per Unit P/FFO 12-Month Total Return 13.4% Rating BUY Risk Rating MEDIUM Analyst CR

Unit Name

Symbol

Brookfield Infrastructure Partners L.P.

BIP, BIP.UN

PV Curr. NAV Carried Implied Interests 2.50 $36.98 Fee 2.25 Fore. $38.93 5% Disc. Price OCX T $33.18 Dec US$ 117.0 $3,882 $0.11 0.3% End Curr. O/S (mm) Cap (mm) Div. Yield Year Rep. Shares Market Ind. Ind. Mgmt 12-Month Target $41.00 Total Return 23.9% Rating BUY

Overall Risk Rating MEDIUM Analyst JB

Stock Name

Onex Corp.

AL BUY = Action List BUY Analyst(s): LE = Linda Ezergailis, P. Eng. 416 983 7784; JB = Jason Bilodeau, CFA 416 308 3741; CR = Cherilyn Radbourne, CA, CFA, 416 308 3403

69

Paper & Forest Products

200 150 100 50 0 Dec00 Dec01 Dec02 Dec03 Dec04 Dec05 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Action List Com p. Group* S&P/TSX Com p. 1M 0.0 (6.0) (1.7) 3M 0.0 3.3 3.6 Total Return % 6M 0.0 (34.6) (8.9) 12M (73.8) (74.0) (8.7) YTD (73.8) (74.0) (8.7) Cum .1 (81.9) (78.5) 72.5

* S&P/TSX Paper & Forest Products (Industry) Since December 29, 2000

Action List

Comp Group*

S&P/TSX

Sean Steuart, CFA 416 308 3399 sean.steuart@tdsecurities.com Graham Meagher, CFA 416 982 5777 graham.meagher@tdsecurities.com

Industry Overview
Performance Summary for the Month The S&P/TSX Paper & Forest Products (Industry) Index decreased by 6.0% during December, compared to a decrease of 1.7% for the S&P/TSX Composite Index. We note that the S&P/TSX Paper & Forest Products (Industry) Index comprises just two lumber-weighted stocks (West Fraser and Canfor). Our brief thoughts on P&FP commodity markets are: Market Pulp: Negative global pulp price momentum slowed in December and several producers have announced list price increases for January, in an effort to stabilize markets. The January list price for North American NBSK pulp is US$890/tonne. We believe that spot prices in all major markets are close to, and in some cases below cash costs for marginal producers. To date, producers have announced modest levels of market-related downtime, but we expect more curtailments. Newsprint: North American newsprint prices have been stable at US$640/tonne since August 2010. Overall market conditions remain challenging, with accelerating rates of consumption decline in North America and sluggish offshore demand. Producers idled approximately 9% of North American newsprint capacity in 2011, helping to balance supply with demand. Uncoated Freesheet: Price momentum turned negative in December for copy paper (copy prices have trended lower since August 2011), while prices for offset rolls remain stable. The current transaction prices for 20-lb. cut-size paper and 50-lb. offset rolls are US$1,055/ton and US$920/ton, respectively. Wood Products: The current Western SPF lumber price is US$261/Mfbm; prices reached a trough mid-November and have been trending higher since then, but we would characterize the overall momentum as stable. The current North Central OSB price is US$192/Msf (7/16 basis). Fundamental demand for OSB tied to the U.S. housing market remains poor; prices remained within a narrow band in 2011. Prices remain below our view of trend levels for both lumber and OSB.

70

Things to Watch For in the Coming Month Price momentum for most pulp and paper commodities is generally negative. Producers have announced price increases for groundwood paper (publishing) grades; we will monitor the success of implementation through Q1/12. The global pulp market is weak and price momentum remains negative, but effective transaction prices have begun to stabilize. We believe that spot prices are close to the bottom, but expect list prices to continue to adjust downwards through the winter months, before resuming positive momentum during Q2/12. We expect a flood of capacity curtailments over the next several months, as spot prices are below cash costs for marginal producers. In 2006, Canada and the U.S. entered into the most recent iteration of the Softwood Lumber Agreement (SLA). On January 18, 2011, the U.S. delivered a Request for Arbitration claiming that B.C. has not properly applied the timber pricing system that was grandfathered under the SLA in the B.C. Interior. On November 16, 2011, Canada filed a comprehensive response. Canadas position is that the increase in the proportion of Grade 4 logs scaled was due to the deterioration in the quality of timber caused by the Mountain Pine Beetle. The U.S. is seeking up to $499 million in remedy via a temporary export charge of 30.6% (in addition to the current 15% export tax) on B.C. lumber exported to the U.S. from April 2012 to October 2013 (or whenever $499 million is collected). A hearing at the London Court of International Arbitration is scheduled to begin February 27, 2012 and a final decision is expected during Q2/12. Our Sector Stance We encourage investors with a 12- to 24-month investment horizon to adopt a market weight position in North American P&FP equities. Global economic risks have increased, but we believe that the market has priced excessive risk into several equities. Within the wood products group, we prefer West Fraser Timber Co. Ltd. (WFT-T), Interfor Ltd. (IFP.A-T), and Norbord Inc. (NBD-T) over Canfor Corp. (CFP-T) and Louisiana-Pacific (LPX-N). Our top picks among pulp and paper producers, in descending order, are Domtar Corp. (UFS-N, T), Mercer International Inc (MERC-Q), Boise Inc. (BZ-N), and Clearwater Paper Corp (CLW-N).

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72
Overall Curr. Symbol Exch. CFF NBD CAS TMB IFP.A UFS WFT ADN FTP CFX CFP CTL TRE ABH FBK T $1.01 Dec C$ 130.1 $131 $0.00 N, T $14.55 Dec US$ 97.1 $1,413 $0.00 T $1.38 Dec US$ 246.1 $338 $0.00 T $0.04 Dec C$ 381.9 $13 $0.00 0.0% ($0.27) ($0.18) ($0.14) $62.1 $96.4 $116.4 nmf nmf T $10.65 Dec C$ 142.7 $1,520 $0.00 0.0% ($0.04) $0.05 $0.27 $256.0 $261.9 $372.2 nmf 39.0x 7.3x 8.5x T $12.42 Dec C$ 71.3 $885 $0.95 7.6% $1.93 $1.30 $2.21 $222.2 $144.7 $218.9 9.5x 5.6x 6.7x T $26.59 Dec C$ 15.3 $406 $0.00 0.0% ($1.34) $1.99 $3.88 $4.2 $70.9 $115.7 13.3x 6.8x 6.8x 4.2x 4.5x 5.1x 7.0x T $10.33 Dec C$ 16.6 $171 $0.83 8.0% $0.57 $0.81 $0.84 $16.1 $18.7 $19.2 12.7x 12.3x 12.8x 12.5x T $41.40 Dec C$ 43.2 $1,787 $0.56 1.4% $0.61 $1.32 $3.52 $238.3 $277.5 $412.7 31.5x 11.8x 6.8x 4.6x N, T $79.96 Dec US$ 38.1 $3,046 $1.40 1.8% $10.47 $7.34 $9.69 $1,070.9 $881.6 $1,003.5 10.9x 8.2x 3.9x 3.4x $100.00 $52.00 $11.00 $30.00 $13.00 $11.00 n/a SUSP. T $4.30 Dec C$ 55.9 $240 $0.00 0.0% ($0.10) $0.21 $0.40 $49.1 $69.6 $81.6 20.2x 10.8x 4.8x 4.1x $5.50 T $2.79 Sep C$ 100.0 $279 $0.00 0.0% ($0.04) $0.26 $0.55 $95.0 $102.2 $136.9 10.8x 5.1x 3.9x 2.9x $3.75 T $4.43 Dec C$ 95.3 $422 $0.16 3.6% $0.01 $0.37 $0.50 $270.3 $335.7 $355.0 11.9x 8.9x 5.5x 5.2x $6.00 39% 34% 28% 27% 27% 15% 13% 12% 3% n/a T $8.10 Dec US$ 44.2 $358 $0.00 0.0% ($0.23) $0.13 $0.92 $42.1 $89.8 $148.1 NMF 8.9x 8.3x 5.0x $11.50 42% V $7.25 Dec C$ 17.3 $125 $0.00 0.0% ($0.71) ($0.03) $0.84 ($1.2) $10.0 $29.5 NMF 8.7x 19.1x 6.5x $11.00 52% BUY BUY BUY BUY BUY BUY BUY HOLD HOLD HOLD HOLD SUSP. Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011E 2012E 2010A 2011E 2012E 2011E 2012E 2011E 2012E Target (7) Return Rating YearRep. Shares Market Ind. EPS EBITDA P/E (x) TEV/EBITDA 12-Month Total Risk Rating Analyst HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH HIGH REDUCE SPEC. SPEC. GM SS SS GM GM SS SS GM SS GM SS GM SS SS GM Overall Curr. Symbol Exch. MERC-Q N N N N N $8.07 Dec US$ 134.5 $1,085 $0.00 0.0% ($0.78) ($0.43) ($0.16) -$7.7 $15.74 Dec US$ 48.3 $760 $0.00 0.0% $1.37 $1.75 $1.77 $163.7 $7.12 Dec US$ 108.9 $775 $0.00 0.0% $0.74 $0.56 $0.69 $336.8 $35.61 Dec US$ 23.5 $836 $0.00 0.0% $1.90 $3.94 $3.87 $194.2 $265.0 $306.7 $215.1 $52.6 $6.10 Dec Eur 56.0 $342 $0.00 0.0% 0.96 0.24 1.23 180.7 118.1 CLW BZ KS LPX Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010A 2011E 2012E 2010A 2011E 2012E 198.7 $265.1 $331.1 $215.0 $108.8 YearRep. Shares Market Ind. EPS EBITDA P/E (x) 2011E 18.2x 9.0x 12.8x 9.0x nmf 2012E 3.6x 9.2x 10.3x 8.9x nmf TEV/EBITDA 2011E 6.8x 4.7x 4.8x 5.2x 18.0x 4.0x 4.7x 4.5x 5.2x 8.7x 12-Month $8.50 $47.50 $7.50 $17.50 $6.50 Total 2012E Target (7) Return 39% 33% 5% 11% Rating BUY BUY BUY HOLD -19% REDUCE Risk Rating Analyst HIGH HIGH HIGH HIGH HIGH GM GM GM GM GM 0.0% ----------------------------------------------------- Suspended --------------------------------------------------------------0.0% -------------------------------------------------------------------------------- Restricted -------------------------------------------------------------------------------------------0.0% -------------------------------------------------------------------------------- Restricted -------------------------------------------------------------------------------------------2010A $959 $606 $904 $620 $254 $220 $0.97 $1.01 $186 $255 $280 $195 $0.99 $635 $650 $930 $898 $640 $640 $660 $920 $665 $310 $220 $0.99 $977 $875 $970 2011A 2012E 2013E

Paper & Forest Products Universe

Canadian Companies

Conifex Timber Inc. (1)

Norbord Inc. (2)

Cascades Inc.

Tembec Inc. (1)

International Forest Products Ltd. (1)

Domtar Corp. (3)

West Fraser Timber Co. Ltd. (1)

Acadian Timber Corp.

Fortress Paper Ltd.

Canfor Pulp Products Inc. (5) (6)

Canfor Corp. (1)

Catalyst Paper Corp.

Sino-Forest Corp. (8)

AbitibiBowater Inc. (1) (3) (9)

Fibrek Inc.

U.S. Companies

Mercer International Inc. (4)

Clearwater Paper Corp. (3)

Boise Inc. (3)

KapStone Paper & Packaging Corp. (3)

Louisiana-Pacific Corp. (3)

(1) Earnings forecasts reflect regional lumber export taxes in 2011 and 2012.

(2) Norbord share price is Canadian dollar denominated; earnings estimates are U.S. dollar denominated.

(3) AbitibiBowater Inc., Boise Inc., Clearwater Paper Corp., Domtar Corp., KapStone Paper & Packaging Corp., and Louisiana-Pacific share price and financial data are U.S. dollar denominated.

(4) Mercer International share price is U.S. dollar denominated; financial data is euro-denominated.

(5) CFX Ind. Div. reflects the 2012 forecasted distribution from CPLP to CPPI.

(6) EPS for Canfor Pulp Products Inc. is DCPU.

(7) Target prices are in the same currency as current prices.

(8) We have suspended our target price, recommendation, and estimates for Sino-Forest Corp. Share price references US OTC markets and is US$-denominated.

(9) AbitibiBowater Inc. has changed its name to Resolute Forest Products. The legal name change will take place in 2012, following shareholder approval at the annual general meeting.

Assumptions

NBSK Pulp (US$ per metric tonne)

Newsprint (US$ per metric tonne)

Uncoated Freesheet: 50-lb. offset rolls (US$ per short ton)

Linerboard: 42-lb. unbleached kraft (US$ per short ton)

Lumber: Western SPF (US$ per Mfbm)

OSB: 7/16" North Central (US$ per Msf)

Exchange Rate (US$/C$)

AL BUY = Action List BUY Analyst(s): SS = Sean Steuart, CFA 416 308 3399; GM = Graham Meagher, CFA 416 982 5777

Pipelines, Power & Utilities

400 300 200 100 0 Jun03 Jun04 Jun05 Jun06 Jun07 Jun08 Jun09 Jun10 Jun11 Action List Com p. Group* S&P/TSX Com p. 1M (2.9) 3.5 (1.7) 3M (1.2) 8.0 3.6 Total Return % 6M 4.3 12.3 (8.9) 12M 10.2 24.1 (8.7) YTD 10.2 24.1 (8.7) Cum .1 279.7 201.0 112.9

* S&P/TSX Utilities (Sector), Oil & Gas Storage & Transportation (Subindustry) Since June 2, 2003

Action List

Comp Group*

S&P/TSX

Linda Ezergailis, P. Eng. 416 983 7784 linda.ezergailis@tdsecurities.com Robert Hope, CFA 416 983 9717 robert.hope@tdsecurities.com

Industry Overview
Performance Summary for the Month In December, the S&P/TSX Utilities Index outperformed the S&P/TSX Composite, which decreased by 1.7%. The Government of Canada 10-year bond yield, a key metric for valuations in the sector, ended the month at 1.9%, down from the previous months close of 2.2%. Valuations for our covered large-cap utility names increased, as price-to-forward-earnings multiples ended the month at 18.6x, compared to 18.4x last month. Things to Watch For in the Coming Month On January 19, the Alberta Utilities Commission will be holding a hearing on a settlement reached between the Market Surveillance Administrator and TransAlta (TA-T, TAC-N). Our Sector Stance: Overweight We believe that sector valuations are attractive, relative to government bond yields. Given the essential nature of energy infrastructure, we believe that the outlook remains bright in just about any economic environment, and recommend an overweight sector stance. Financial risk remains low, in our view given continued investor demand for yield. Indeed, even during the financial crisis a few years ago, companies in our coverage universe had continued access to debt and equity capital markets. While the growth outlook of regulated utilities servicing industrial customers could become more muted in an economic slowdown, existing earnings are largely based on returns on historical cost of investments. Therefore, in our view, business risks have not increased materially. In the long term, we encourage investors to focus on names with solid growth potential through energy infrastructure investment opportunities, such as ATCO (ACO.X-T).

73

ATCO Ltd.
(ACO.X-T, C$60.24); 12-Month Target: C$78.00 Linda Ezergailis, P. Eng. 416 983 7784 ATCO is a diversified utility holding company, with a 52.8% stake in Canadian Utilities Ltd., as well as an Industrials business that manufactures modular buildings and provides industrial noise solutions. The company utilizes a dual share structure, and is effectively controlled by R.D. Southern. We believe that the long-term outlook for ATCO is positive, largely driven by its 52.8% interest in CU. ATCO, through CU, is expected to benefit from the high-level of electric transmission investment that is required in Alberta, which should result in strong, low-risk regulated earnings growth. Given the attractive potential returns and valuations relative to comparable stocks, we rate ATCO an Action List BUY.

74

Pipelines, Power & Utilities Universe

Overall Curr. Price $60.24 $61.54 $25.12 $33.04 $33.37 $44.53 $38.09 $21.02 3.9% 2.3 21.9x 20.1x 18.6x 17.2x Dec C$ 222.9 $4,685.4 $1.16 5.5% 12.49 1.7 $0.88 $1.25 $1.28 $1.37 23.9x 16.8x 16.4x 15.4x $22.00 Dec C$ 761.0 $28,986.5 $1.13 3.0% 10.36 3.7 $1.32 $1.51 $1.58 $1.88 29.0x 25.2x 24.0x 20.3x $41.00 Dec C$ 704.0 $31,349.1 $1.68 3.8% 22.54 2.0 $1.97 $2.20 $2.36 $2.39 22.6x 20.2x 18.9x 18.6x $47.00 Dec C$ 187.5 $6,256.9 $1.20 3.6% 20.20 1.7 $1.60 $1.65 $1.70 $1.77 20.9x 20.2x 19.6x 18.8x $37.00 14% 9% 11% 10.2% Dec C$ 123.6 $4,083.7 $1.35 4.1% 13.63 2.4 $1.65 $1.58 $1.66 $1.82 20.0x 21.0x 19.9x 18.1x $35.00 10% Dec C$ 97.1 $2,439.2 $1.26 5.0% 22.94 1.1 $1.38 $1.22 $1.56 $1.75 18.2x 20.6x 16.1x 14.3x $28.00 16% Dec C$ 127.5 $7,846.4 $1.61 2.6% 24.43 2.5 $3.28 $3.69 $4.04 $4.17 18.8x 16.7x 15.2x 14.7x $69.00 15% BUY BUY BUY BUY BUY BUY HOLD Dec C$ 57.8 $3,481.9 $1.14 1.9% 36.43 1.7 $4.88 $5.44 $5.87 $5.97 12.3x 11.1x 10.3x 10.1x $78.00 31% AL BUY End Curr. O/S (mm) Cap (mm) Div. Yield Value P/BV 2010A 2011E 2012E 2013E 2010A 2011E 2012E 2013E Target Return Rating T T T T T T, N T, N T, N YearRep. Shares Market Ind. Book EPS P/E 12-Month Total Risk Rating LOW LOW MEDIUM LOW LOW LOW LOW MEDIUM Analyst LE LE LE LE LE LE LE LE

Stock Name

Symbol Exch.

ATCO Ltd.

ACO.X

Canadian Utilities Ltd.

CU

Capital Power Corp.

CPX

Emera Inc.

EMA

Fortis Inc.

FTS

TransCanada Corp.

TRP

Enbridge Inc.

ENB

TransAlta Corp.

TA, TAC

Average

Overall Curr. Price $31.84 $19.02 $9.85 $15.30 $20.10 $18.63 $15.98 $50.00 $29.66 5.4% 5.4% Dec C$ 168.2 $4,988.8 $1.56 5.3% 1.56 5.3% $1.57 $1.83 $1.89 Dec C$ 71.9 $3,595.0 $2.04 4.1% 2.05 4.1% $2.98 $3.11 $3.14 Sept C$ 37.4 $596.9 $1.00 6.3% 1.00 6.3% $2.28 $2.04 $2.10 $2.00 $3.19 $1.92 Dec C$ 260.5 $4,853.1 $1.05 5.6% 1.05 5.6% $1.23 $1.42 $1.44 $1.48 Dec C$ 39.7 $798.0 $1.24 6.2% 1.24 6.1% $1.38 $1.42 $1.75 $1.90 14.6x 15.1x 7.0x 16.8x 18.9x 14.3x Dec C$ 195.1 $2,985.0 $1.00 6.5% 1.00 6.5% $1.23 $1.21 $1.34 $1.40 12.5x Dec C$ 272.0 $2,679.2 $0.54 5.5% 0.54 5.5% $0.68 $0.81 $0.88 $0.96 14.5x Dec C$ 96.0 $1,825.9 $0.96 5.0% 0.96 5.0% $0.32 $1.33 $1.46 $1.57 nmf 14.3x 12.1x 12.6x 14.2x 13.2x 7.8x 16.1x 16.2x 13.4x Dec C$ 89.7 $2,856.4 $1.38 4.3% 1.39 4.3% $2.17 $2.30 $2.79 $3.11 14.7x 13.8x End Curr. O/S (mm) Cap (mm) Div. Yield 2012E Yield 2010A 2011E 2012E 2013E 2010A 2011E T T T T T T T T YearRep. Shares Market Ind. Div. AFFO Per Shr (f.d.) P/AFFO 2012E 11.4x 13.0x 11.2x 11.4x 11.5x 12.9x 7.6x 15.9x 15.7x 12.3x 2013E 10.2x 12.1x 10.2x 11.0x 10.6x 12.6x 8.0x 15.7x 15.4x 11.7x 12-Month Target $33.00 $21.00 $10.00 $16.50 $19.00 $18.00 $17.00 $39.00 $22.00 Total Return 8% 15% 7% 14% 1% 2% 13% -18% -21% Rating BUY BUY BUY BUY HOLD HOLD HOLD Risk Rating MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM LOW REDUCE MEDIUM REDUCE MEDIUM Analyst LE RH LE LE LE LE RH LE LE

Stock Name

Symbol Exch.

AltaGas Ltd.

ALA

Gibson Energy Inc.

GEI

Provident Energy Ltd.

PVE, PVX T, N

Veresen Inc.

VSN

Enbridge Income Fund Holdings Inc.

ENF

Inter Pipeline Fund

IPL.UN

Valener Inc.

VNR

Keyera Corp.

KEY

Pembina Pipeline Corp.

PPL

Average

AL BUY = Action List BUY Analyst(s): LE = Linda Ezergailis, P. Eng. 416 983 7784; RH = Robert Hope, CFA 416 983 9717

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Real Estate
350 300 250 200 150 100 50 Dec00 Dec01 Dec02 Dec03 Dec04 Dec05 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. 1.4 2.0 (1.7) 3M 42.6 6.3 3.6 6M 40.8 6.2 (8.9) 12M 53.2 21.7 (8.7) YTD 53.2 21.7 (8.7) Cum .1 92.4 257.9 72.5

* S&P/TSX Real Estate (Industry), S&P/TSX Capped REIT Since December 29, 2000

Action List

Comp Group*

S&P/TSX

Sam Damiani, CFA 416 983 9640 sam.damiani@tdsecurities.com Jonathan Kelcher, CFA 416 307 9931 jonathan.kelcher@tdsecurities.com

Industry Overview
Performance Summary for the Month In December 2011, Canadian real estate equities outperformed the broad market. The S&P/TSX Capped REIT Index was up 2.0%, bringing the 2011 return to +21.7%, versus the S&P/TSX Composites decline of 1.7% in December and 8.7% loss for the year. Canadian REITs underperformed relative to their U.S. counterparts for the month with the MSCI U.S. REIT Index posting a 4.7% gain. For the year, Canadian REITs outperformed their U.S. counterparts whose 2011 return was 8.7%. In December, the average FFO Yield Spread for the REIT sector (non-hotel) increased to 5.01% from the previous months 4.83%, as the FFO Yield (inverted P/FFO) decreased by 3 bps to 6.95%, and the 10-year Government of Canada bond yield decreased by 21 bps to 1.94%. The LTM range for the FFO Yield Spread is 3.65.0%, and the range since 1997 is 2.110.9%. 2011 Leaders and Laggards In our coverage universe, on a total return basis, the top three performers for 2011 were Mainstreet Equity Corp. (+61%), CANMARC REIT (+53%), and Canadian Apartment Properties REIT (+36%). The bottom three were InnVest REIT (-31%), Royal Host Inc. (-15%), and Brookfield Office Properties (-8%). Things to Watch For in the Coming Month Results of the holiday season retail sales and its effect on retail REITs, as well as annual RevPAR growth statistics for 2011 from STR/HVS. Sector Fundamentals Office Canadas national office vacancy rate of 8.1% in Q4/11 was down slightly from Q3/11s 8.2%, and from the recession high of 10.2% in Q2/10 (Source: CBRE). Retail We maintain our view that this sector could potentially be one of the first to stage a meaningful recovery, should the economy continue to improve. According to Statistics Canada, Canadian retail sales growth remained consistent at 1.0% in October with gains well spread across the country. Retailer demand has bounced off the bottom, and shopping centre vacancy rates have been falling. Announcements including those by Target Corp., Nordstrom Inc., and Tanger

76

Outlets reinforced our stance that more U.S. retailers have or are expected to announce plans to expand into Canada. Further, we see the potential for increased retailer demand from the expansion of existing U.S. retailers in Canada, including J. Crew Group Inc. and Limited Brands Inc. (Victorias Secret, Pink, Bath and Body Works). In all, we continue to believe that these could represent significant space demand that would tighten vacancy rates further and potentially help bring a resurgence of new development. Multi-residential According to CMHC, the national vacancy rate decreased to 2.2% in October 2011, from 2.6% in October 2010. Average rents for twobedroom apartments in existing structures increased by 2.2%. Looking ahead, we see rental demand remaining relatively flat (but positive) near term in central and eastern Canada, assuming employment growth remains constrained, although a softening housing market could benefit at the margin. In western Canada, we expect improving rental demand conditions to continue into 2012. Note that the Ontario government has announced a 3.1% rent increase guideline for 2012. Lodging According to STR/HVS, RevPAR grew 5.6% year over year in 2010, rebounding from the 12.2% decrease in 2009. Between STR/HVS and PKF Consulting, the average Canadian RevPAR growth is forecast to be 1.3% and 4.4% in 2011 and 2012, respectively. In the U.S., STR/HVS forecasts a 7.7% increase for 2011 and a 3.9% increase in 2012.

Our Sector Stance We have seen continued cap rate compression over the past 20 months, which we believe is a result of the current low government bond yield environment and availability of capital in general. Valuations currently allow for acquisitions to be accretive. We believe that valuations are vulnerable if bond yields rise significantly over a short period of time, or if the economy heads into another recession, neither of which we expect. On availability of capital, we expect continued strong investor demand for high-yield investments, as long as the yield curve remains low. Overall, we are maintaining our market-weight sector rating. Since early 2009, valuations have recovered to well above mid-cycle levels. We continue to favour names with one or more of the following: track record of value creation, visible growth drivers, stable or improving demand/supply fundamentals, balance sheets with reasonable or low debt and ample liquidity, and/or unusual relative undervaluation. We believe that the low interest rate environment and increased attention to the space by pension funds increases the possibility of another round of M&A activity.

77

78
AFFO Curr. Symbol Exch. FCR LW KMP MEQ FC BPO RYL 4.1% 19.5x 17.1x 15.9x 102% 62% T $1.48 Dec C$ 17.6 $26 $0.00 0.0% ($0.14) ($0.09) ($0.04) neg neg neg $1.50 99% 0% N $15.64 Dec US$ 503.1 $7,868 $0.56 3.6% $0.84 $0.82 $0.87 18.6x 19.1x 18.0x $17.70 88% 68% T $13.19 Dec C$ 14.9 $197 $1.03 7.8% $1.01 $1.07 $1.09 13.1x 12.3x 12.1x $9.71 136% 96% $12.50 $16.50 $1.25 T $23.99 Sep C$ 10.4 $249 $0.00 0.0% $0.73 $1.09 $1.26 32.9x 22.0x 19.0x $24.50 98% 0% $26.00 T $11.57 Dec C$ 49.2 $569 $0.58 5.0% $0.58 $0.64 $0.70 19.9x 18.1x 16.5x $12.50 93% 91% $12.50 13% 8% 3% 9% -16% T $11.28 Dec C$ 24.5 $276 $0.85 7.5% $0.97 $0.98 $1.01 11.6x 11.5x 11.2x $10.50 107% 87% $12.00 14% T $17.30 Dec C$ 171.4 $2,965 $0.80 4.6% $0.84 $0.89 $0.93 20.6x 19.4x 18.6x $18.10 96% 90% $20.00 20% Price End Curr. O/S (mm) Cap (mm) Div. Yield 2011E 2012E 2013E 2011E 2012E 2013E NAV P/NAV Ratio Target Return Rating BUY BUY BUY BUY HOLD HOLD HOLD YearRep. Shares Market Curr. AFFO/Sh (f.d.) P/AFFO (x) Before-Tax Payout 12-Month Total Overall Risk Rating MEDIUM MEDIUM MEDIUM HIGH LOW MEDIUM HIGH SD JK JK JK SD SD SD

Real Estate Corporations Universe

Analyst

First Capital Realty

Leisureworld Senior Care Corp.

Killam Properties Inc.

Mainstreet Equities

Firm Capital Mortgage Investment Corp.

Brookfield Office Properties (US$)

Royal Host Inc.

Average

Real Estate Investment Trusts Universe

AFFO Curr. Symbol Exch. WRK-UN D-UN NPR-UN PMZ-UN TGA-UN HR-UN BOX-UN AP-UN CSH-UN REI-UN INN-UN REF-UN CWT-UN BEI-UN CAR-UN CRR-UN EXE-UN CMQ-UN T $16.00 Dec C$ 54.8 $877 T $8.50 Dec C$ 83.0 $706 $0.84 $0.95 T $14.02 Dec C$ 68.4 $959 $0.89 T $22.31 Dec C$ 78.1 $1,742 $1.08 4.8% 6.3% 9.9% 5.9% 6.0% T $50.44 Dec C$ 52.2 $2,633 $1.80 3.6% T $26.77 Dec C$ 123.0 $3,293 $1.55 5.8% T $35.40 Dec C$ 67.3 $2,382 $1.44 4.1% $2.08 $1.51 $2.22 $1.17 $0.87 $0.66 T $4.13 Dec C$ 93.5 $386 $0.40 9.7% $0.40 T $26.43 Dec C$ 275.6 $7,284 $1.38 5.2% $1.22 $1.34 $0.37 $2.17 1.6x 2.4x 1.2x 0.9x 0.9x T $8.50 Dec C$ 143.6 $1,221 $0.54 6.4% $0.56 $0.62 T $25.28 Dec C$ 51.2 $1,294 $1.32 5.2% $1.15 $1.55 T $24.32 Dec C$ 93.2 $2,267 $1.08 4.4% $1.00 $1.14 $1.18 $1.80 $0.65 $1.41 $0.43 $2.22 1.7x 2.6x 1.3x 0.9x 1.0x T $23.26 Dec C$ 177.0 $4,117 $1.10 4.7% $1.34 $1.37 $1.55 T $11.69 Dec C$ 72.2 $844 $0.75 6.4% $0.80 $0.85 $0.89 T $20.61 Dec C$ 82.5 $1,700 $1.22 5.9% $1.13 $1.18 $1.27 18.2x 14.6x 17.4x 24.3x 22.0x 15.2x 21.7x 10.3x 17.0x 17.7x 22.7x 19.1x 16.1x 12.9x 17.2x T $29.72 Dec C$ 29.4 $874 $1.53 5.1% $2.07 $2.20 $2.38 14.4x T $32.67 Dec C$ 69.5 $2,271 $2.20 6.7% $2.13 $2.30 $2.36 15.3x 14.2x 13.5x 17.5x 13.8x 17.0x 21.3x 16.3x 13.7x 19.7x 11.2x 16.3x 16.5x 20.8x 18.7x 15.8x 9.8x 15.7x T $13.24 Dec C$ 35.8 $474 $1.12 8.5% $1.00 $1.08 $1.09 13.2x 12.3x Price End Curr. O/S (mm) Cap (mm) Div. Yield 2011E 2012E 2013E 2011E 2012E YearRep. Shares Market Curr. AFFO/Sh (f.d.) P/AFFO (x) 2013E 12.1x 13.8x 12.5x 16.2x 13.1x 15.0x 20.6x 14.0x 13.1x 18.7x 9.6x 15.9x 15.8x 19.8x 17.6x 15.8x 8.9x 14.8x Before-Tax NAV $13.30 $34.20 $29.25 $21.20 $12.75 $22.10 $26.70 $24.25 $8.50 $22.40 $4.70 $32.00 $24.00 $50.00 $20.50 $13.40 $9.00 P/NAV 100% 96% 102% 97% 92% 105% 91% 104% 100% 118% 88% 111% 112% 101% 109% 105% 94% 102% Payout Ratio 104% 96% 70% 103% 88% 80% 95% 85% 87% 103% 108% 66% 96% 74% 91% 100% 97% 91% 12-Month Target $16.00 $39.00 $35.00 $24.00 $13.50 $27.00 $28.00 $28.00 $9.00 $28.00 $5.00 $38.00 $28.00 $53.00 $23.00 $14.00 $8.00 --------------------------------------------------------------Restricted -----------------------------------------------Total Return 29% 26% 23% 22% 22% 21% 20% 16% 12% 11% 31% 11% 10% 9% 8% 6% 4% Rating BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY HOLD HOLD HOLD HOLD HOLD HOLD Overall Risk Rating MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM HIGH MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM HIGH Analyst SD SD JK SD JK SD SD JK SD SD SD SD SD JK JK SD SD

Whiterock REIT

Dundee REIT

Northern Property REIT

Primaris Retail REIT

TransGlobe Apartment REIT

H&R REIT

Brookfield Office Properties Canada

Allied Properties REIT

Chartwell Seniors Housing REIT

RioCan REIT

InnVest REIT

Canadian REIT

Calloway REIT

Boardwalk REIT

Canadian Apartment Properties REIT

Crombie REIT

Extendicare REIT

CANMARC REIT (1)

Average

(1) Recently renamed from Homburg Canada REIT.

AL BUY = Action List BUY Analyst(s): SD = Sam Damiani, CFA 416 983 9640; JK = Jonathan Kelcher, CFA 416 307 9931

Special Situations
300 200 100 0 Jun04 Jun05 Jun06 Jun07 Jun08 Jun09 Jun10 Jun11 Action List Com p. Group* S&P/TSX Com p. * S&P/TSX SmallCap Since June 9, 2004 1M (1.7) (2.1) (1.7) 3M 3.4 5.9 3.6 Total Return % 6M (6.6) (12.7) (8.9) 12M (6.3) (16.4) (8.7) YTD (6.3) (16.4) (8.7) Cum .1 166.8 33.8 74.5

Action List

Comp Group*

S&P/TSX

Damir Gunja 416 983 4186 damir.gunja@tdsecurities.com Michael Elkins, CA, CFA 416 983 6809 michael.elkins@tdsecurities.com

Industry Overview
Performance Summary for the Month In December, AG Growth (AFN-T), Vicwest Inc. (VIC-T) and Just Energy (JE-T), were up 19.8%, 12.1% and 11.8%, respectively, posting the highest positive price returns in our coverage universe. At the lower end were Progressive Waste Solutions (BIN-T), Great Canadian Gaming (GC-T) and GLV (GLV.A-T), which shed 4.9%, 6.2% and 21.3%, respectively. Notable events in December included: Progressive Waste (BIN-T) announced an updated normal course issuer bid (increased by 3.5 million shares). The company may purchase up to 7.5 million common shares, or approximately 6.3% of the total public float, by August 18, 2012. EnerCare (ECI-T) received multiple requests for a special meeting of EnerCare shareholders from Octavian Advisors LP, which is one of its largest shareholders, with 13% of the outstanding common shares. Octavian is displeased with the companys performance and is requesting the nomination of four additional directors to the current board of six. Also, it is requesting a shareholder meeting no later than February 10, 2012. Things to Watch For in the Coming Month Updates on Octavians demands for an EnerCare shareholder meeting. Our Sector Stance Although the pace of the economic recovery appears to be moderating over the near term, we believe that some transportation names, TransForce in particular (which is our top pick), offers good leverage to an extended upturn. TransForce should generate material upside over the next few years, driven by the acquisition of DHL Canadas Canadian operations (Loomis Express) and increasing profitability in the Specialized Services division. Progressive Waste also remains among our top picks, as we believe that it offers above-average opportunities for both organic and acquisition-based growth. Currently, all the transportation names (all BUY rated) that we cover have over 35% plus total potential returns. Other names we would like to highlight with 30% plus total potential returns are Just Energy and Superior Plus.
79

TransForce Inc.
(TFI-T, $12.95); 12-Month Target: $19.00 Damir Gunja 416 983 4186 TransForce is a North American leader in the transportation and logistics industry, with operations across Canada and the U.S. The company operates four business segments: Package and Courier; Less-than-truckload; Truckload; Specialized Services. We believe TransForce is the premier trucking investment vehicle in Canada, with exposure to a broad cross-section of the Canadian, and to a lesser extent, U.S. economies (both geographically and by industry). We expect the Package and Courier and Specialized Services divisions to be the primary drivers of growth, which should more than offset softness in the Less-than-truckload division. We believe that the valuation will migrate higher as the higher-growth Package and Courier and Specialized Services divisions garner higher multiples (versus lower trucking multiples). Our price target of $19.00 is based on 7.0x our fiscal 2012 EBITDA forecast.

80

Special Situations Universe

Curr. EBITDA (mm) 2011E $130.0 $149.2 $139.1 $276.9 $540.3 $253.0 $75.3 $55.8 $171.3 $32.5 $151.3 $25.1 $32.0 $0.57 $0.79 9.7x 7.6x 16.0x 11.5x $1.08 $1.08 $148.4 n/a n/a 7.4x 7.6x n/a n/a $1.02 $1.02 51% 125% $42.3 $0.14 $0.32 6.6x 5.1x 25.6x 11.2x n/a n/a n/a $185.0 $1.73 $2.27 8.4x 7.8x 15.3x 11.7x n/a n/a n/a $71.8 n/a n/a 10.7x 8.3x n/a n/a $2.40 $2.40 67% $35.00 $29.00 $5.50 $13.00 $9.00 $78.1 $0.47 $0.41 10.3x 9.9x 22.7x 26.0x $0.98 $0.98 107% $10.00 $258.5 n/a n/a 7.5x 7.3x n/a n/a $1.20 $0.60 86% $8.00 50% 3% 0% 9% 54% 10% 11% $589.0 $1.07 $1.17 6.8x 6.2x 18.3x 16.7x $0.50 $0.50 23% $29.50 53% $294.0 n/a n/a 7.9x 7.4x n/a n/a $1.24 $1.24 63% $14.00 33% $141.4 n/a n/a 6.6x 6.5x n/a n/a n/a n/a n/a $10.50 25% BUY BUY BUY BUY HOLD HOLD HOLD HOLD HOLD HOLD $160.9 n/a n/a 7.0x 6.5x n/a n/a $0.65 $0.65 56% $10.00 15% BUY $155.0 n/a n/a 8.1x 6.8x n/a n/a $1.20 $1.20 59% $17.50 26% BUY 2012E 2011E 2012E 2011E 2012E 2011E 2012E 2011E 2012E Ratio Target Return Rating Rating MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM HIGH MEDIUM MEDIUM MEDIUM HIGH HIGH MEDIUM EPS EV/EBITDA P/E Dividends Price $14.85 $9.26 $8.38 $11.46 $19.59 $5.75 $10.70 $37.48 $26.49 $3.58 $12.69 $9.10 Dec C$ 17.4 $158 $86 $244 Dec C$ 63.1 $801 $320 $1,121 Mar C$ 44.1 $158 $57 $215 Dec US$ 30.5 $808 $311 $1,437 Dec C$ 12.5 $469 $130 $598 Sept C$ 37.9 $405 $233 $773 Dec C$ 109.5 $630 $1,261 $1,891 Dec US$ 120.7 $2,365 $1,300 $3,664 Mar C$ 140.9 $1,615 $563 $2,178 Dec C$ 81.8 $685 $232 $918 Dec C$ 55.7 $516 $524 $1,040 Dec C$ 41.7 $619 $429 $1,048 End Curr. O/S (mm) Cap (mm) Debt (mm)* Value ** Year- Rep. Shares Market Net Ent. Payout 12-Mth Total Overall Risk Analyst DG DG DG DG DG DG ME DG DG DG DG DG

Stock Name

Symbol Exch.

Chemtrade (12)

CHE.UN

EnerCare (1)

ECI

Great Canadian (2)

GC

Just Energy (3) ***

JE

Progressive (5)

BIN

N, T

Superior (4) ****

SPB

Whistler Blackcomb (11)

WB

Ag Growth (6)

AFN

FirstService (7)

FSRV, FSV Q, T

GLV (8)

GLV'A

Parkland (9)

PKI

Vicwest (10)

VIC

Transportation
Curr. EBITDA (mm) 2011E $312.5 $52.1 $36.8 $16.2 $32.2 -$0.47 $0.23 10.7x 5.4x $39.6 $0.39 $0.42 5.1x 4.7x $57.3 $0.57 $0.75 6.1x 5.5x 14.0x 10.4x n/a $357.5 $0.81 $1.13 6.6x 5.8x 16.0x 2012E 2011E 2012E 2011E 2012E 2011E 11.5x 10.7x 9.7x 25.0x EPS EV/EBITDA P/E 2012E Price $12.95 $8.00 $4.07 $5.76 Dec US$ 16.3 $94 $79 $173 Dec C$ 25.7 $105 $82 $186 Dec C$ 35.8 $286 $30 $316 Dec C$ 96.5 $1,250 $827 $2,077 End Curr. O/S (mm) Cap (mm) Debt (mm)* Value ** Year- Rep. Shares Market Net Ent. Dividends 2011E $0.43 $0.40 $0.25 n/a 2012E $0.46 $0.40 $0.25 n/a Payout 12-Mth Ratio n/a n/a n/a n/a $19.00 $10.50 $6.00 $8.00 Total Target Return 50% 36% 54% 39% Rating AL BUY BUY BUY BUY Overall Risk Rating HIGH HIGH HIGH HIGH Analyst DG DG DG DG

Stock Name

Symbol Exch.

TransForce (13)

TFI

Contrans (14)

CSS

Trimac (15)

TMA

Vitran (16)

VTNC, VTN Q, T

* Net Debt excludes convertible debt; Ent. Value includes convertible debt.

** Enterprise value includes net debt adjusted for options and warrants and FDIF.

*** Payout refers to distributions divided by post-marketing cash flow / Post-marketing cash flow used in place of EPS / using Adjusted EBITDA

**** EBITDA from operations (5) Progressive Waste Solutions Ltd. (6) Ag Growth International Inc. (7) FirstService Corp. (8) GLV Inc. (12) Chemtrade Logistics Income Fund (11) Whistler Blackcomb Holdings Inc. (10) Vicwest Inc. (9) Parkland Fuel Corp. (13) TransForce Inc. (14) Contrans Group Inc. (15) Trimac Transportation Ltd. (16) Vitran Corp.

(1) EnerCare Inc.

(2) Great Canadian Gaming Corp.

(3) Just Energy Group Inc.

(4) Superior Plus Corp.

AL BUY = Action List BUY Analyst(s): DG = Damir Gunja 416 983 4186; ME = Michael Elkins, CA, CFA 416 983 6809

81

Technology
375 300 225 150 75 0 Jan03 Jan04 Jan05 Jan06 Jan07 Jan08 Jan09 Jan10 Jan11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. (31.5) (10.2) (1.7) 3M (18.2) (15.5) 3.6 6M (18.2) (31.4) (8.9) 12M (18.2) (52.5) (8.7) YTD (18.2) (52.5) (8.7) Cum .1 (35.4) (25.9) 126.5

* S&P/TSX Technology (Sector) Since January 31, 2003

Action List

Comp Group*

S&P/TSX

Scott Penner, CFA 416 308 3406 scott.penner@tdsecurities.com Doug Taylor, CFA 416 983 2664 doug.taylor@tdsecurities.com

Industry Overview
Performance Summary for the Month The S&P/TSX Information Technology Index decreased by just over 10% last month. The comparable S&P 500 Information Technology Index decreased by 1%. Things to Watch For in the Coming Month In January, we will receive new technology industry data points from software bellwethers Microsoft and SAP; hardware vendors Apple, EMC, Intel, Texas Instruments and Juniper Networks; and services providers IBM, Infosys, TCS and Wipro. Additionally, we are expecting quarterly updates from the following companies under coverage: EXFO Inc. (EXF-T, EXFO-Q) on January 11 Sandvine Corp. (SVC-T) on January 12 DragonWave Inc. (DWI-T, DRWI-Q) on January 12 20-20 Technologies, Inc. (TWT-T) in mid-January

Our Sector Stance: Market Weight The early indicators for Q4 IT spending provided through the November results of bellwethers Oracle and Accenture were more mixed than recent quarters. Following a long trend of outperforming expectations, Oracle shares declined 12% after the company missed expectations and provided guidance slightly below the Street. Oracle management attributed the softer performance to longer selling cycles caused by customers additional last-minute approval requirements. However, management views this as a short-term phenomenon, and not an indication of softening IT budgets. Accenture provided guidance that was in line with the Street, as strength in financial services and health care verticals offset relative weakness and uncertainty in Europe. The company did not see any changes in client behavior, and also noted that it did not believe IT budgets were declining, even if they are not rising significantly this year. That Accenture intends to hire 60,000 employees this year testifies to managements positive outlook.

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We continue to recommend a market weight stance on the technology sector. Open Text (OTEX-Q, OTC-T) is our top large cap pick. Among small cap names, our top picks include Enghouse (ESL-T) and Descartes (DSGX-Q, DSG-T).

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84
Overall Curr. Symbol ABT GIB.A, GIB DSGX, DSG ESL MDA OTEX, OTC SVC TWT AAH CMG CSU DRWI, DWI EXFO, EXF RKN RCM T $24.10 Mar US$ 12.6 $303 T $1.00 Sep C$ 64.4 $64 $0.00 0.0% ($0.04) $0.07 $0.10 15.0x Q, T US$5.92 Aug US$ 61.6 $365 $0.00 0.0% $0.28 $0.41 $0.58 14.3x Q, T US$3.45 Feb US$ 35.5 $122 $0.00 0.0% ($0.76) ($0.81) $0.04 n/m 78.2x 10.1x 9.8x T $76.74 Dec US$ 21.2 $1,626 $2.00 2.6% $5.82 $6.49 $7.28 11.6x 10.3x T $15.35 Mar C$ 37.8 $580 $0.54 3.5% $0.52 $0.54 $0.58 27.8x 26.4x T $13.86 Dec C$ 14.1 $196 $0.80 5.8% $1.58 $1.16 $1.73 12.0x 8.0x $19.00 $14.00 $80.00 US$6.50 $7.00 $1.50 T $2.50 Oct US$ 18.9 $47 $0.00 0.0% $0.09 $0.08 $0.18 30.6x 13.6x $3.50 T $1.14 Nov C$ 141.9 $162 $0.00 0.0% ($0.05) $0.01 $0.06 198.0x 19.9x $2.00 Q, T US$51.14 Jun US$ 58.6 $2,997 $0.00 0.0% $4.17 $4.94 $5.65 10.3x 9.0x US$79.00 54% 75% 40% 43% -5% 7% 88% 18% 50% T $47.09 Dec C$ 41.2 $1,941 $1.00 2.1% $2.84 $2.95 $3.69 16.0x 12.8x $55.00 19% T $12.24 Oct C$ 25.6 $313 $0.20 1.6% $0.66 $0.71 $0.81 17.4x 15.1x $15.00 24% Q, T US$7.16 Jan US$ 63.4 $454 $0.00 0.0% $0.50 $0.52 $0.60 13.8x 11.9x US$9.00 26% BUY BUY BUY BUY BUY HOLD HOLD HOLD HOLD HOLD HOLD HOLD T, N $19.20 Sep C$ 271.3 $5,209 $0.00 0.0% $1.56 $1.71 $1.86 11.2x 10.3x $25.00 30% BUY T $4.94 Jun C$ 43.4 $214 $0.00 0.0% ($0.04) ($0.06) $0.05 n/m 92.2x $6.00 21% BUY Exch. Price End Curr. O/S (mm) Cap (mm) Div. Yield LTM FY1 FY2 FY1 FY2 Target Return Rating Rating HIGH MEDIUM HIGH HIGH MEDIUM HIGH HIGH HIGH HIGH MEDIUM MEDIUM HIGH HIGH HIGH YearRep. Shares Market Ind. EPS P/E 12-Month Total Risk Analyst SP SP SP SP SP SP SP SP SP DT SP SP SP SP SP -------------------------------------------------------------------Restricted---------------------------------------------------------------------------

Technology

Stock Name

Absolute Software Corp.

CGI Group Inc.

Descartes Systems Group (US$)

Enghouse Systems Ltd.

MacDonald, Dettwiler & Associates Ltd.

Open Text Corp. (US$)

Sandvine Corp

20-20 Technologies Inc. (1)

Aastra Technologies Ltd.

Computer Modelling Group Ltd.

Constellation Software Inc. (1)

DragonWave Inc. (US$)

EXFO Inc.

Redknee Solutions Inc.

RuggedCom Inc. (US$)

(1) To align with reporting currency, valuations have been adjusted using US$/C$ rate of $1.0208 (closing price as of January 03, 2012).

AL BUY = Action List BUY Analyst(s): SP = Scott Penner, CFA 416 308 3406; DT = Doug Taylor, CFA 416 983 2664

Transportation Aerospace
300 250 200 150 100 50 Oct02 Oct03 Oct04 Oct05 Oct06 Oct07 Oct08 Oct09 Oct10 Oct11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. Airlines (Industry) Since October 11, 2002 10.7 4.5 (1.7) 3M 10.7 3.2 3.6 6M 10.7 (35.0) (8.9) 12M 8.2 (19.3) (8.7) YTD 8.2 (19.3) (8.7) Cum .1 136.5 (5.1) 150.4

* S&P/TSX Aerospace & Defense (Subindustry),

Action List

Comp Group*

S&P/TSX

Tim James, CFA, 416 308 9773 tim.james@tdsecurities.com

Industry Overview
Performance Summary for the Month In November, the S&P/TSX Aerospace, Defense (Subindustry) and Airlines (Industry Group) Index was up 4.5%. Things to Watch For in the Coming Month Certain Aerospace and Air Transportation comparables are scheduled to report Q4/11 results during the month. We believe that Bombardier may disclose aircraft deliveries for Q4/11 and provide 2012 delivery guidance. Our Sector Stance Air Transportation Overweight: Air travel demand remains strong for Canadian airlines. Traffic growth, while moderating, remains positive and load factors are holding up well in the face of rising fares, increased industry capacity and slowing economic growth. WestJet and Air Canada have been reasonably successful at passing along rising fuel costs, although we expect this to become more challenging. We forecast that demand will soften heading into 2012, despite what we view as encouraging commentary from U.S. and Canadian airlines regarding the near-term demand environment. Despite growing risk to the economic outlook and stock market volatility, we anticipate considerable upside in the sector. WestJet is currently trading below trough 2009 multiples, despite a stronger balance sheet and a superior earnings outlook. Air Canada is expected to benefit from the continued deleveraging of the balance sheet, the successful resolution of labour negotiations, and improved confidence in the sustainability of record EBITDAR. We believe that Chorus Aviation offers the most attractive risk-adjusted upside among the Canadian airlines and is our Action List pick for the group. Aerospace Overweight: The outlook for regional commercial and business aircraft has started to improve, and large commercial aircraft demand remains strong. Commercial aircraft orders have more than doubled through November, and business jet orders are stable. We believe there is growing risk that the
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recovery in the business jet market will be further delayed, but see limited risk to production plans at Boeing and Airbus at this point. Bombardier had a good start to the year, reporting a material increase in business jet orders and gaining much needed traction on the CSeries. However, management has signalled that the risk of a delay on the program is increasing and there have been no new firm CSeries orders since June. The companys regional aircraft backlog continues to decline, while competitors secure the majority of new aircraft orders, and we believe that there is growing risk to the business jet outlook, given economic uncertainty. Regardless, we maintain that the compelling valuation, the potential for aircraft orders, and the long-term outlook for the transportation and business jet businesses justify a positive view on the stock. We believe that CAEs broad civil market exposure and global footprint position the company extremely well to benefit from the ongoing civil aerospace recovery. While governments around the world have shown a growing determination to reduce defense spending, we believe that CAEs military products and services are well shielded from cutbacks in the long term, and actually represent a tool that enables customers to reduce training expenses. We prefer CAE to Bombardier on a risk-adjusted basis. We believe that the small cap aerospace suppliers are trading at very low valuations due to concerns over the impact of military spending restraint, caution regarding the weakening economic growth on the civil market and, in the case of Northstar Aerospace, financial risk. Hroux-Devtek, our lowest risk buy rated stock in the group, has an attractive valuation, strong balance sheet, track record of operational execution, broad civil aerospace exposure, and there could be potential upside from an acquisition.

Chorus Aviation Inc.

(CHR.B-T, $3.17); 12-Month Target: $5.00 Tim James 416 308 9771 We upgraded Chorus Aviation to an Action List BUY on December 19. Chorus shares have underperformed comparables over the past several months, resulting in an extremely compelling valuation in our view. The dividend yield is 19%, the free cash flow yield is 29%, and the company is trading at a 22% discount to comps on 2012 EBITDAR. We believe that the market is discounting excessive risk related to 1) the ongoing benchmarking and rate reset processes with Air Canada, and 2) the solvency and liquidity of Air Canada. We estimate that the market is discounting a dividend cut of nearly 40% and a realized CPA mark-up of 5.96.4% in 2012 which we view as unreasonable and a highly unlikely outcome. We continue to like the earnings and cash flow stability of the business, the downside protection provided by the CPA with Air Canada, and the dividend yield. The recent disclosure that a shareholder with Board representation had increased its stake in the company to over 10% is encouraging, in our view.

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Transportation/Aerospace Universe
Overall Curr. Symbol CHR.A, CHR.B WJA, WJA.A HRX CAE AIM BBD.A, BBD.B AC.A, AC.B ACE.A, ACE.B NAS TRZ.A, TRZ.B MAL T $3.50 Dec C$ 18.2 $64 $0.00 0.0% $0.57 $0.55 $0.66 6.4x 5.3x T $7.02 Oct C$ 38.0 $267 $0.00 0.0% ($0.19) ($0.67) $0.47 nmf 14.9x $8.00 $4.00 T $0.67 Dec US$ 30.7 $21 $0.00 0.0% $0.04 $0.18 $0.26 3.7x 2.6x $1.50 T $10.69 Dec C$ 32.5 $347 $0.00 0.0% nmf nmf nmf nmf nmf $14.00 T $0.99 Dec C$ 279.1 $276 $0.00 0.0% ($0.39) $0.12 $0.39 8.3x 2.5x $4.50 T $4.01 Jan US$ 1,753.0 $7,031 $0.10 2.5% $0.49 $0.45 $0.58 8.9x 6.9x $5.50 40% 355% 31% 123% 14% 14% T $11.94 Dec C$ 173.6 $2,073 $0.60 5.0% $1.18 $1.51 $1.68 7.9x 7.1x $17.00 47% T, N $9.89 Mar C$ 257.6 $2,547 $0.16 1.6% $0.62 $0.74 $0.86 13.4x 11.5x $14.50 48% T $6.72 Mar C$ 30.4 $204 $0.00 0.0% $0.63 $0.77 $0.89 8.7x 7.5x $10.00 49% BUY BUY BUY BUY SPEC. BUY SPEC. BUY HOLD HOLD HOLD T $11.76 Dec C$ 138.3 $1,626 $0.00 0.0% $1.05 $1.09 $1.19 10.8x 9.9x $19.50 66% BUY T $3.17 Dec C$ 123.4 $391 $0.60 18.9% $0.48 $0.59 $0.58 5.4x 5.5x $5.00 77% AL BUY Exch. Price End Curr. O/S (mm) Cap (mm) Div. Yield 2011E 2012E 2013E 2012E 2013E Target Return Rating Rating HIGH HIGH HIGH MEDIUM MEDIUM HIGH SPEC SPEC HIGH HIGH SPEC YearRep. Shares Market Ind. EPS P/E 12-Month Total Risk Analyst TJ TJ TJ TJ TJ TJ TJ TJ TJ TJ TJ

Stock Name

Chorus Aviation Inc.

WestJet Airlines Ltd.

Hroux-Devtek Inc. (1)

CAE Inc. (1)

Aimia Inc.

Bombardier Inc. (2)

Air Canada

ACE Aviation Holdings Inc.

Northstar Aerospace Corp.(2)

Transat A.T. Inc. (3)

Magellan Aerospace Corporation

(1) CAE Inc. and Hroux-Devtek Inc. have a March 31 year end. Earnings shown for 2011 are actual.

(2) All figures are in U.S. dollars.

(3) Transat A.T. has an October 31 year end. Earnings shown for 2011 are actual.

AL BUY = Action List BUY Analyst(s): TJ = Tim James, CFA, 416 308 9773

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Transportation Railroads
140 130 120 110 100 90 80 Oct10 Feb11 Oct11 Dec10 Aug10 Aug11 Dec11 Jun10 Apr11 Jun11 Total Return % 1M Action List Com p. Group* S&P/TSX Com p. Since June 8, 2010 0.0 4.5 (1.7) 3M 0.0 19.7 3.6 6M 0.0 7.3 (8.9) 12M 0.0 19.3 (8.7) YTD 0.0 19.3 (8.7) Cum .1 0.0 35.1 8.3

* S&P/TSX Railroads (Subindustry),

Action List

Comp Group*

S&P/TSX

Cherilyn Radbourne, CA, CFA 416 308 3403 cherilyn.radbourne@tdsecurities.com

Industry Overview
Performance Summary for the Month The Big Five Public Class I rail stocks share price performance ranged from down 4% to up 12% in December. Canadian Pacific Railway Ltd. (CP; CP-T, N) led the gainers, rising 12%, followed by Union Pacific Corp. (UNP-N), which rose 4%. Canadian National Railway Co. (CN; CNR-T, CNI-N) advanced 2%, while CSX Corp. (CSX-N) and Norfolk Southern Corp. (NSC-N) declined by 3% and 4%, respectively. Things to Watch For in the Coming Month Union Pacific will kick off the Q4/11 reporting season on January 19. January 19: Union Pacific our forecast: US$1.83, consensus: US$1.79, Q4/10: US$1.56. January 23: CSX our forecast: US$0.44, consensus: US$0.44, Q4/10: US$0.38. January 24: CN our forecast: $1.23, consensus: $1.27, Q4/10: $1.08. January 24: Norfolk Southern our forecast: US$1.39, consensus: US$1.38, Q4/10: US$1.00. January 26: CP our forecast: $1.15, consensus: $1.13, Q4/10: $1.12. Volume Gains Led by Merchandise: With only one week of carload data still to be released, total Big Six Class I carloads were on track to post a 4% year-overyear gain in the fourth quarter. Traffic growth during the quarter was led by merchandise, which we define as total carloads, excluding intermodal, coke and coal, grain and grain mill products. Merchandise carloads were up a robust 9% year-over-year in the fourth quarter, with particular strength in motor vehicles and equipment, metals and products, and petroleum products. Intermodal carloads were up 5% year-over-year, with weakness in international traffic masking gains in domestic intermodal.

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After spending most of the year in negative territory, coal carloads were up 2% year-over-year in the fourth quarter, although high rates of natural gas substitution continue to exert a drag. Grain carloads were down 9% year-over-year, largely reflecting weakness in U.S. grain exports, with the return of the Black Sea region to the export market. Pricing Gains Strong and Stable: In general, core/same-store pricing gains for the U.S. rails have been consistent, in the range of 57%. Pricing gains have been more muted but stable in Canada, as expected, in the range of 24%. We view tightness in the truck market as being supportive of rail pricing in intermodal and other truck-competitive segments. Cost Variability: For an industry that has a high proportion of fixed network costs (about 50% of total costs), we would argue that the rails as a group have demonstrated impressive cost variability in response to large volume swings, both upward (the 2010 recovery) and downward (the 2008-2009 global recession). Free Cash Flow Deployment: Dividend payout ratios across the industry seem to be trending higher, toward the 30% range. Opportunistic share repurchases were a theme in Q3/11, particularly at CSX and Norfolk Southern. We expect share buybacks to contribute low single-digit EPS growth for all of the rails, except CP. Regulatory Landscape: Regulatory risk is always present, but does not seem particularly elevated. Valuation: The rails are trading at an average P/FTM EPS multiple of 13.9x, which is in line with the groups historical average P/FTM EPS multiple of 14.0x (range of 12.3-15.7x); however, that average of 13.9x masks a historically wide valuation gap between the U.S. rails and Canadian rails, a gap that became more exaggerated based on CPs share price performance in late December. CP is trading at 16.7x our FTM EPS estimate and is the most highly-valued stock in the group, followed by CN at 15.3x. The U.S. rails are trading at an average P/FTM EPS multiple of 12.6x, and the valuation gap between the Canadian rails and the U.S. rails stands at 3.4x multiple points. The U.S. rails are trading towards the low-end of the group's historical valuation range, while CP in particular is trading above the high-end of the range. Historically, the Canadian rails have traded at a 0.4x multiple point discount to the U.S. rails. Our Sector Stance We have an overweight sector recommendation. Our BUY-rated stocks are CN, CSX, Norfolk Southern, and Union Pacific. We rate CP as HOLD. We see better upside in the U.S. rails, given the valuation gap. Medium to long term, we believe that the rails are positioned to gain modal share from trucks, based on rising fuel prices, increasing highway congestion, and more stringent environmental regulations.

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90
Overall Curr. Symbol T, N T, N N N N $105.94 Dec. US$ 488.1 $51,709 $2.40 2.3% $5.53 $6.56 $7.70 16.1x 13.8x $118.00 14% $72.86 Dec. US$ 349.0 $25,428 $1.72 2.4% $3.98 $5.35 $6.03 13.6x 12.1x $95.00 33% $21.06 Dec. US$ 1077.0 $22,682 $0.48 2.3% $1.35 $1.66 $1.91 12.7x 11.0x $30.00 45% BUY BUY BUY $69.01 Dec. C$ 170.5 $11,766 $1.20 1.7% $3.87 $3.23 $4.19 21.4x 16.5x $67.00 -1% HOLD $80.15 Dec. C$ 451.4 $36,180 $1.30 1.6% $4.20 $4.76 $5.37 16.8x 14.9x $87.00 10% BUY CP CSX NSC UNP Exch. Price End Curr. O/S (mm) Cap (mm) Div. Yield 2010 2011E 2012E 2011E 2012E Target Return Rating Rating MEDIUM MEDIUM MEDIUM MEDIUM MEDIUM YearRep. Shares Market Ind. EPS P/E 12-Month Total Risk Analyst CR CR CR CR CR

Transportation Railroads Universe

Stock Name

Canadian National Railway Co.

CNR, CNI

Canadian Pacific Railway Ltd.

CSX Corp.

Norfolk Southern Corp.

Union Pacific Corp.

AL BUY = Action List BUY Analyst(s): CR = Cherilyn Radbourne, CA, CFA, 416 308 3403

Notes

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Notes

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Upcoming Events
Date January 10, 2012 January 11, 2012 January 12, 2012 January 12, 2012 January 12, 2012 January 12, 2012 January 13, 2012 January 13, 2012 January 13, 2012 January 16, 2012 January 17, 2012 January 17, 2012 January 17, 2012 January 17, 2012 January 17, 2012 January 17, 2012 January 17, 2012 January 17, 2012 January 17, 2012 January 18, 2012 January 18, 2012 January 18, 2012 January 18, 2012 January 19, 2012 January 19, 2012 January 19, 2012 January 20, 2012 January 24, 2012 Host Agnico-Eagle Mines Ltd. Pengrowth Energy Corp. Baytex Energy Provident Energy ARC Resources Ltd. Southern Pacific Resources Penn West Petroleum Ltd. ARC Resources Ltd. Southern Pacific Resources London Energy Conference 2012 Provident Energy Ltd. Bonavista Energy Corp. Enerplus Corp. Laracina Energy Ltd. Enerplus Corp. Imperial Oil Limited Canadian Natural Resources Ltd. Cenovus Energy Inc. Vermilion Energy Inc. Vermilion Energy Inc. Enerplus Corp. Laracina Energy Ltd. Husky Energy Inc. TransGlobe REIT Laracina Energy Ltd. Husky Energy Inc. Husky Energy Inc. TD Securities 2012 Mining Conference Event Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Conference Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Institutional Marketing Conference Location New York Frankfurt London Stockholm Frankfurt Zurich Zurich London Paris London Zurich London Zurich Paris London London London London Paris Zurich Frankfurt Zurich Paris New York Zurich Zurich Frankfurt Toronto Additional Info* Jan. 1011 Jan. 1113 Jan. 1618 Jan. 2425

* For additional information, contact your institutional sales representative.

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Action List Rules

The maximum number of companies allowed on the Action List for any sector will normally be limited to the lesser of five companies or 20% of the number of companies in the universe of coverage. Equal weightings are assumed for all Action List stocks. All return calculations are total-return calculations. Returns do not assume taxes or commissions. Dividends are included the day the stock goes ex-dividend. If there are no stocks in an Action List, a 0% return is assumed. Stocks traded mainly in U.S. dollars are converted to Canadian dollars for return calculations using The Globe and Mails quoted exchange rate for the day after the closing price. Dividends are converted the day the stock goes exdividend, using the next days Globe and Mail quoted exchange rate. When changes to the Action List are made, the price used to update returns is the closing price on the day the associated Action Note is issued. If the Action Note is issued after 16:00 EST, the next days closing price is used. Examples: (1) if an Action Note comes out Tuesday before 16:00, Tuesdays close will be used. (2) if an Action Note comes out Tuesday at 16:30, Wednesdays close will be used.

If an analyst becomes restricted on a stock, the stock may not be added or deleted from the Action List.

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Appendix A. Important Disclosures

Alternative Energy Algonquin Power & Utilities Corp. (AQN-T) 1, 2, 4 Atlantic Power Corp. (ATP-T) 1, 2, 4, 9 Boralex Inc. (BLX-T) 2 Brookfield Renewable Energy Partners L.P. (BEP.UN-T) 1, 2, 4 Capstone Infrastructure Corp. (CSE-T) 1, 2, 4 Innergex Renewable Energy Inc. (INE-T) 1, 2, 4, 10 Northland Power Inc. (NPI-T) 2 Banks Bank of Montreal (BMO-T, BMO-N) 1, 2, 4, 9, 10 Bank of Nova Scotia (The) (BNS-T, BNS-N) 2, 4, 9, 10 Canadian Imperial Bank of Commerce (CM-T, CM-N) 2, 4, 9, 10 Canadian Western Bank (CWB-T) 2, 4, 9, 10 Genworth MI Canada Inc. (MIC-T) 9 Laurentian Bank of Canada (LB-T) 10 National Bank of Canada (NA-T) 2, 4, 9, 10 Royal Bank of Canada (RY-T, RY-N) 1, 2, 4, 9, 10 Toronto-Dominion Bank (The) (TD-T, TD-N) 1, 2, 4, 5, 9 Biotechnology & Health Care CML Healthcare Inc. (CLC-T) 2, 4, 9 Nordion Inc. (NDZ-N, NDN-T) 2, 4, 9 Paladin Labs Inc. (PLB-T) 1, 2, 4 Valeant Pharmaceuticals International Inc. (VRX-N, VRX-T) 5, 9 Chemicals and Fertilizers Agrium Inc. (AGU-N, AGU-T) 2, 4, 9, 10 Methanex Corp. (MEOH-Q, MX-T) 9 Migao Corp. (MGO-T) 9 Potash Corp. of Saskatechwan Inc. (POT-N, POT-T) 9 Communications BCE Inc. (BCE-T, BCE-N) 1, 2, 4, 9, 10 Bell Aliant Inc. (BA-T) 1, 2, 4, 9 Cogeco Cable Inc. (CCA-T) 9, 12 Cogeco Inc. (CGO-T) 12 Manitoba Telecom Services Inc. (MBT-T) 9, 10 Quebecor Inc. (QBR.B-T) 1, 2, 4, 12 Rogers Communications Inc. (RCI.B-T, RCI-N) 1, 2, 4, 9, 14 Shaw Communications Inc. (SJR.B-T, SJR-N) 1, 2, 4, 9, 10, 14 TELUS Corp. (T.A-T, TU-N) 1, 2, 4, 9, 10, 14 Thomson Reuters Corp. (TRI-T, TRI-N) 2, 4, 9 Consumer Discretionary Atrium Innovations Inc. (ATB-T) 1, 2, 4 Canadian Tire Corporation, Ltd. (CTC.A-T) 2, 9, 10 Dollarama Inc. (DOL-T) 9 Dorel Industries Inc. (DII.B-T) 12, 15 Garda World Security Corp. (GW-T) 1, 2, 4, 9 Gildan Activewear Inc. (GIL-T, GIL-N) 2, 5, 9 RONA Inc. (RON-T) 1, 2, 4, 9, 10 Uni-Select Inc. (UNS-T) 2, 4 Consumer Staples Alimentation Couche-Tard Inc. (ATD.B-T) 9, 12 Colabor Group Inc. (GCL-T) 2 Empire Company Ltd. (EMP.A-T) 14, 15 Jean Coutu Group (PJC) Inc. (The) (PJC.A-T) 9, 12 Loblaw Companies Ltd. (L-T) 9 Maple Leaf Foods Inc. (MFI-T) 1, 2, 4, 9 Metro Inc. (MRU.A-T) 9, 12 Rogers Sugar Inc. (RSI-T) 1, 2, 4 Saputo Inc. (SAP-T) 9 Shoppers Drug Mart Corp. (SC-T) 2, 9, 10 Tim Hortons Inc. (THI-T, THI-N) 2, 4, 9 Diversified Financials AGF Management Ltd. (AGF.B-T) 2, 9, 14 CI Financial Corp. (CIX-T) 2, 9 First National Financial Corp. (FN-T) 2, 4 Gluskin Sheff + Associates (GS-T) n/a IGM Financial Inc. (IGM-T) 9 Onex Corp. (OCX-T) 9, 12 Power Corp. of Canada (POW-T) 9, 12 Power Financial Corp. (PWF-T) 2, 9 Sprott Inc. (SII-T) n/a TMX Group Inc.~ (X-T) 9 Energy Producers - Intermediate Advantage Oil & Gas Ltd. (AAV-T, AAV-N) 9 ARC Resources Ltd. (ARX-T) 2, 4, 9 Baytex Energy Corp. (BTE-T, BTE-N) 2, 4, 5, 9 Bonavista Energy Corp. (BNP-T) 2, 4, 9 Canadian Oil Sands Ltd. (COS-T) 2, 9 Celtic Exploration Ltd. (CLT-T) 1, 2, 4, 9 Crescent Point Energy Corp. (CPG-T) 1, 2, 4, 9 Crew Energy Inc. (CR-T) 1, 2, 4, 9 Daylight Energy Ltd. (DAY-T) 2, 9 Enerplus Corp. (ERF-T, ERF-N) 2, 4, 9, 10 Legacy Oil + Gas Inc. (LEG-T) 9 Lone Pine Resources Inc. (LPR-T) 1, 2, 4 NAL Energy Corp. (NAE-T) 9 NuVista Energy Ltd. (NVA-T) 1, 2, 4, 9 Paramount Resources Ltd. (POU-T) 1, 2, 4, 9 Pengrowth Energy Corp. (PGF-T, PGH-N) 1, 2, 4, 9 Penn West Petroleum Ltd. (PWT-T) 2, 4, 9 Perpetual Energy Inc. (PMT-T) 2, 4, 9 PetroBakken Energy Ltd. (PBN-T) 2, 4, 9 Peyto Exploration & Development Corp. (PEY-T) 1, 2, 4, 9 Progress Energy Resources Corp. (PRQ-T) 2, 4, 9 Tourmaline Oil Corp. (TOU-T) 1, 2, 4, 9 Trilogy Energy Corp. (TET-T) 1, 2, 4, 9 Vermilion Energy Inc. (VET-T) 1, 2, 4, 5, 9 WestFire Energy Ltd. (WFE) 2, 14 Zargon Oil & Gas Ltd. (ZAR-T) 1, 2, 4 Energy Producers - International Bankers Petroleum Ltd. (BNK-T, BNK-L) 9 C&C Energia Ltd. (CZE-T) 1, 2, 4 Canacol Energy Ltd. (CNE-T, CNEC-CB) 1, 2, 4 Gran Tierra Energy Inc. (GTE-T, GTE-A) 9 Niko Resources Ltd. (NKO-T) 9 Pacific Rubiales Energy Corp. (PRE-T, PREC-CB) 9, 10 Parex Resources Inc. (PXT-V) 1, 2, 4 Petrodorado Energy Ltd. (PDQ-V) 1, 2, 4 Petrominerales Ltd. (PMG-T) 2, 4, 9 Porto Energy Corp. (PEC-V) 1, 2, 4 ShaMaran Petroleum Corp. (SNM-V) 15 WesternZagros Resources Ltd. (WZR-V) 1, 2, 4 Energy Producers - Senior & Unconventional Aurora Oil & Gas Ltd. (AEF-T, AUT-A) 1, 2, 4 BlackPearl Resources Inc. (PXX-T) 1, 2, 4, 9 Canadian Natural Resources Ltd. (CNQ-T, CNQ-N) 2, 4, 9, 10 Cenovus Energy Inc. (CVE-T, CVE-N) 9 Encana Corp. (ECA-N, ECA-T) 2, 4, 9 Husky Energy Inc. (HSE-T) 1, 2, 4, 9 Imperial Oil Ltd. (IMO-T) 9 Nexen Inc. (NXY-T, NXY-N) 2, 4, 9 Petrobank Energy & Resources Ltd. (PBG-T) 2, 4, 9, 10 Suncor Energy Inc. (SU-T, SU-N) 9, 10 Talisman Energy Inc. (TLM-N, TLM-T) 1, 2, 4, 9 Energy Services Canyon Services Group Inc. (FRC-T) 9 Ensign Energy Services Inc. (ESI-T) 9 Mullen Group Ltd. (MTL-T) 9 Precision Drilling Corp. (PD-T, PDS-N) 1, 2, 4, 9 Savanna Energy Services Corp. (SVY-T) 1, 2, 4 ShawCor Ltd. (SCL.A-T) 2, 10, 12 Trican Well Service Ltd. (TCW-T) 9 Trinidad Drilling Ltd. (TDG-T) 1, 2, 4, 9 Gold & Precious Metals Agnico-Eagle Mines Ltd. (AEM-N, AEM-T) 2, 4, 9 Alamos Gold Inc. (AGI-T) 9 AuRico Gold Inc. (AUQ-T, AUQ-N) 9 Barrick Gold Corp. (ABX-N, ABX-T) 2, 4, 9 Belo Sun Mining Corp. (BSX-V) 1, 2, 4 Canaco Resources Inc. (CAN-V) 1, 2, 4 Centerra Gold Inc. (CG-T) 9 Continental Gold Ltd. (CNL-T) 1, 2, 4, 9 Detour Gold Corp. (DGC-T) 1, 2, 4, 9 Eldorado Gold Corp. (ELD-T, EGO-N) 9 Energold Drilling Corp. (EGD-V) 1, 2, 4, 5 Exeter Resource Corp. (XRC-T, XRA-A) 2, 4, 9 Extorre Gold Mines Ltd. (XG-T) 1, 2, 4 Franco-Nevada Corp. (FNV-T) 1, 2, 4, 9 Goldcorp Inc. (GG-N, G-T) 9, 10 Guyana Goldfields Inc. (GUY-T) 9 IAMGOLD Corp. (IMG-T, IAG-N) 9 Jaguar Mining Inc. (JAG-T) 9 Kinross Gold Corp. (KGC-N, K-T) 2, 9 Lake Shore Gold Corp. (LSG-T) 2, 4 Major Drilling Group International Inc. (MDI-T) 1, 2, 4 Minefinders Corp. Ltd. (MFL-T, MFN-A) 9 New Gold Inc. (NGD-A, NGD-T) 9 Osisko Mining Corp. (OSK-T) 9 Primero Mining Corp. (P-T) 2, 4 Rubicon Minerals Corp. (RMX-T, RBY-A) 1, 2, 4, 9 San Gold Corp. (SGR-T) 2, 4 Yamana Gold Inc. (AUY-N, YRI-T) 2, 9, 10 Industrial Products Aecon Group Inc. (ARE-T) 2, 9 Armtec Infrastructure Inc. (ARF-T) 1, 2, 4 ATS Automation Tooling Systems Inc. (ATA-T) 9 Churchill Corp. (The) (CUQ-T) 2, 4 Finning International Inc. (FTT-T) 2, 9 IBI Group Inc. (IBG-T) 1, 2, 4 Russel Metals Inc. (RUS-T) 9 SNC-Lavalin Group Inc. (SNC-T) 9 Stantec Inc. (STN-T, STN-N) 9 Toromont Industries Ltd. (TIH-T) 2, 4 Viterra Inc. (VT-T) 1, 2, 4, 9, 10 Insurance Great-West Lifeco Inc. (GWO-T) 1, 2, 4, 9 Industrial-Alliance Life Insurance Co. (IAG-T) 1, 2, 4, 9 Intact Financial Corp. (IFC-T) 1, 2, 4, 9, 16 Manulife Financial Corp. (MFC-T, MFC-N) 1, 2, 4, 5, 9, 10 Sun Life Financial Inc. (SLF-T, SLF-N) 1, 2, 4, 9, 10 Media Astral Media Inc. (ACM.A-T) 9, 14 Cineplex Inc. (CGX-T) 2 Corus Entertainment Inc. (CJR.B-T, CJR-N) 2, 9, 14 DHX Media Ltd. (DHX-T) 10 Newfoundland Capital Corp. Ltd. (NCC.A-T) 12 Postmedia Network Canada Corp. (PNC.B-T) 1, 2, 4, 15, 16 Torstar Corp. (TS.B-T) 2, 14 Transcontinental Inc. (TCL.A-T) 9, 10, 12, 15 TVA Group Inc. (TVA.B-T) 14 Yellow Media Inc. (YLO-T) 2, 4, 9 Metals & Minerals Breakwater Resources Ltd. (BWR-T) 1, 2, 4, 9 Cameco Corp. (CCO-T, CCJ-N) 2, 9, 10 Capstone Mining Corp. (CS-T) 9 Cline Mining Corp. (CMK-T) 1, 2, 4 First Quantum Minerals Ltd. (FM-T) 9 HudBay Minerals Inc. (HBM-T) 2, 9 Inmet Mining Corp. (IMN-T) 9 Ivanhoe Mines Ltd. (IVN-T, IVN-N) 9 Lundin Mining Corp. (LUN-T, LMC-N) 9, 10 Macarthur Minerals Ltd. (MMS-T) 1, 2, 4 Mercator Minerals Ltd. (ML-T) 9 Nevsun Resources Ltd. (NSU-T, NSU-A) 9 Northern Dynasty Minerals Ltd. (NDM-T, NAK-A) 9 Pan American Silver Corp. (PAAS-Q, PAA-T) 9 Quadra FNX Mining Ltd. (QUX-T) 5, 9 SEMAFO Inc. (SMF-T) 9 Silver Wheaton Corp. (SLW-N, SLW-T) 9

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Appendix A. Important Disclosures Contd

Taseko Mines Ltd. (TKO-T, TGB-A) 1, 2, 4, 9 Teck Resources Ltd. (TCK.B-T, TCK-N) 2, 9, 12 Thompson Creek Metals Company Inc. (TCM-T, TC-N) 5, 9 Multi-Industry Brookfield Asset Management Inc. (BAM-N, BAM.A-T, BAMA-XEN) 1, 2, 4, 5, 9, 10, 16 Brookfield Infrastructure Partners L.P. (BIP-N, BIP.UN-T) 2, 14 Paper & Forest Products Boise Inc. (BZ-N) 2 Canfor Corp. (CFP-T) 2, 9 Cascades Inc. (CAS-T) 2, 9 Domtar Corp. (UFS-N, UFS-T) 2, 4, 9 Fortress Paper Ltd. (FTP-T) 1, 2, 4 International Forest Products Ltd. (IFP.A-T) 1, 2, 4, 5, 12 Norbord Inc. (NBD-T) 1, 2, 4 Sino-Forest Corp. (TRE-T) 9, 15 Tembec Inc.^ (TMB-T) 5 West Fraser Timber Co. Ltd. (WFT-T) 2 Pipelines, Power & Utilities AltaGas Ltd. (ALA-T) 1, 2, 4, 9 ATCO Ltd. (ACO.X-T) 14 Canadian Utilities Ltd. (CU-T) 1, 2, 4, 9, 14 Capital Power Corp. (CPX-T) 1, 2, 4, 9, 16 Capital Power Income L.P. (CPA.UN-T) 1, 2, 4 Emera Inc. (EMA-T) 1, 2, 4, 9, 10 Enbridge Inc. (ENB-T, ENB-N) 1, 2, 4, 9, 10 Enbridge Income Fund Holdings Inc. (ENF-T) 1, 2, 4 Fortis Inc. (FTS-T) 1, 2, 4, 9, 10 Gibson Energy Inc. (GEI-T) 1, 2, 4 Inter Pipeline Fund (IPL.UN-T) 1, 2, 4 Keyera Corp. (KEY-T) 2, 4, 9 Pembina Pipeline Corp. (PPL-T) 1, 2, 4, 9 Provident Energy Ltd. (PVE-T) 1, 2, 4, 9 TransAlta Corp. (TA-T, TAC-N) 1, 2, 4, 9, 10 TransCanada Corp. (TRP-T, TRP-N) 1, 2, 4, 9, 10 Veresen Inc. (VSN-T) 1, 2, 4, 9 Real Estate Allied Properties REIT (AP.UN-T) 1, 2, 4 Brookfield Office Properties Canada (BOX.UN-T) 1, 2, 4 Brookfield Office Properties Inc. (BPO-N, BPO-T) 1, 2, 4, 9 Calloway REIT (CWT.UN-T) 1, 2, 4, 9 Canadian Apartment Properties REIT (CAR.UN-T) 1, 2, 4 Canadian REIT (REF.UN-T) 2 CANMARC REIT (CMQ.UN-T) 1, 2, 4 Chartwell Seniors Housing REIT (CSH.UN-T) 2, 4, 9 Crombie REIT (CRR.UN-T) 1, 2, 4 Dundee REIT (D.UN-T) 1, 2, 4 Extendicare REIT (EXE.UN-T) 2, 4, 9 Firm Capital Mortgage Investment Corp. (FC-T) 1, 2, 4 First Capital Realty Inc. (FCR-T) 1, 2, 4, 9 H&R REIT (HR.UN-T) 1, 2, 4, 9 InnVest REIT (INN.UN-T) 1, 2, 4 Killam Properties Inc. (KMP-T) 1, 2, 4 Leisureworld Senior Care Corp. (LW-T) 1, 2, 4 Northern Property REIT (NPR.UN-T) 1, 2, 4 Primaris Retail REIT (PMZ.UN-T) 1, 2, 4 RioCan REIT (REI.UN-T) 1, 2, 4, 9 TransGlobe Apartment REIT (TGA.UN-T) 1, 2, 4 Whiterock REIT (WRK.UN-T) 1, 2, 4 Special Situations Chemtrade Logistics Income Fund (CHE.UN-T) 2, 4 Contrans Group Inc. (CSS-T) 2, 4, 12, 15 Enercare Inc. (ECI-T) 2 FirstService Corp. (FSV-T, FSRV-Q) 2, 12 GLV Inc. (GLV.A-T) 12, 15 Great Canadian Gaming Corp. (GC-T) 9 Just Energy Inc. (JE-T) 1, 2, 4, 9 Noranda Income Fund (NIF.UN-T) 2, 4, 10 Parkland Fuel Corp. (PKI-T) 1, 2, 4 Pizza Pizza Royalty Income Fund (PZA.UN-T) 9 Progressive Waste Solutions Ltd. (BIN-N, BIN-T) 2, 9 Superior Plus Corp. (SPB-T) 1, 2, 4, 9 TransForce Inc. (TFI-T) 1, 2, 4, 9 Whistler Blackcomb Holdings Inc. (WB-T) 1, 2, 4 Technology 20-20 Technologies Inc. (TWT-T) 2 CGI Group Inc. (GIB.A-T, GIB-N) 2, 4, 9, 12 Constellation Software Inc. (CSU-T) 1, 2, 4 DragonWave Inc. (DRWI-Q, DWI-T) 9 EXFO Inc. (EXFO-Q, EXF-T) 12 Open Text Corp. (OTEX-Q, OTC-T) 9 RuggedCom Inc. (RCM-T) 2, 4 Transportation - Aerospace, Railroads ACE Aviation Holdings Inc. (ACE.A-T, ACE.B-T) 10, 13 Aimia Inc. (AIM-T) 2, 4, 9 Air Canada (AC.B-T, AC.A-T) 1, 2, 4, 15 Bombardier Inc. (BBD.B-T) 9, 12 CAE Inc. (CAE-T, CGT-N) 2, 9 Canadian National Railway Co. (CNR-T, CNI-N) 2, 4, 9, 10 Canadian Pacific Railway Ltd. (CP-T, CP-N) 1, 2, 4, 9, 10 Chorus Aviation Inc. (CHR.B-T, CHR.A-T) 9 Hroux-Devtek Inc. (HRX-T) 2, 4 Transat A.T. Inc. (TRZ.B-T, TRZ.A-T) 13 WestJet Airlines Ltd. (WJA-T) 9

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16.

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Additional Important Disclosures ~ TD Securities Inc. will be a participating dealer in the establishment of the Alpha Trading System along with other investment dealers - CIBC World Markets, National Bank Financial, RBC Capital Markets, Canaccord Capital Corp., BMO Nesbitt Burns and Scotia Capital. ^ The Research Analyst responsible for coverage of this stock is related to David J. Steuart, a member of the Board of Directors of Tembec Inc. Carole S. Taylor, Director of BCE Inc., is a member of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Nadir Mohamed, President and Chief Executive Officer of Rogers Communications Inc. is a member of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. John M. Thompson, Director of Thomson Reuters Corp., is a member of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Pierre H. Lessard, Executive Chairman of the Board of Metro Inc., is a member of the board of directors of The TorontoDominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Pierre H. Lessard, a Director of SNC-Lavalin Group Inc., is a member of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Hugh J. Bolton, Director of Teck Resources Ltd., is a member of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Frank McKenna, a Director of Brookfield Asset Management Inc., is a Deputy Chair of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Brian Levitt, Director of Domtar Corp., is a member of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Henry H. Ketcham, Chairman of the Board, President & CEO of West Fraser Timber Co. Ltd., are members of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. William E. Bennett and Hugh J. Bolton, Directors of Capital Power Corp., are members of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Karen E. Maidment, Director of TransAlta Corp., is a member of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Wendy K. Dobson, Director of TransCanada Corp., is a member of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Hugh J. Bolton, Director of Canadian National Railway Co., is a member of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. Hugh J. Bolton, Director of WestJet Airlines Ltd., is a member of the board of directors of The Toronto-Dominion Bank. TD Securities Inc. is a wholly owned subsidiary of The Toronto-Dominion Bank. TD Securities Inc. acts as an agent on behalf of AGF Management Ltd. in the execution of securities transactions. TD Securities Inc. acts as an agent on behalf of CI Financial Corp. in the execution of securities transactions. TD Securities Inc. acts as an agent on behalf of IGM Financial Inc. in the execution of securities transactions. TD Securities Inc. acted as Financial Advisor to Agnico-Eagle Mines Ltd. in the acquisition of Grayd Resource Corp. TD Securities Inc. acts as an agent on behalf of Sprott Inc. in the execution of securities transactions. TD Securities Inc. acts as an agent on behalf of Great-West Lifeco Inc. in the execution of securities transactions. TD Securities Inc. acts as an agent on behalf of Industrial-Alliance Life Insurance Co. in the execution of securities transactions. TD Securities Inc. acts as an agent on behalf of Intact Financial Corp. in the execution of securities transactions. TD Securities Inc. acts as an agent on behalf of Manulife Financial Corp. in the execution of securities transactions. TD Securities Inc. acts as an agent on behalf of Gluskin Sheff + Associates in the execution of securities transactions. In addition, TD Securities Inc. has a prime brokerage arrangement with Gluskin Sheff + Associates. TD Securities Inc. has acted as financial advisor to Lake Shore Gold in connection with the strategic review process for the Mexican exploration portfolio.

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The stocks total return is expected to exceed a minimum of 15%, on a risk-adjusted basis, over the next 12 months and it is a top pick in the Analysts sector. BUY: The stocks total return is expected to exceed a minimum of 15%, on a risk-adjusted basis, over the next 12 months. SPECULATIVE BUY: The stock's total return is expected to exceed 30% over the next 12 months; however, there is material event risk associated with the investment that could result in significant loss. HOLD: The stocks total return is expected to be between 0% and 15%, on a risk-adjusted basis, over the next 12 months. TENDER: Investors are advised to tender their shares to a specific offer for the company's securities or to support a proposed combination reflecting our view that a superior offer is not forthcoming. REDUCE: The stocks total return is expected to be negative over the next 12 months. Overall Risk Rating in order of increasing risk: Low (6.8% of coverage universe), Medium (33.7%), High (48.7%), Speculative (10.8%) Distribution of Research Ratings
Distribution of Research Ratings^ REDUCE 2% BUY 63% 80% 70% 60% 50% 40% 30% 20% 10% 0% Investment Banking Services Provided*

Research Ratings Action List BUY:

67%

HOLD 35%

30% 2% BUY HOLD REDUCE

Current as of January 4, 2012 ^ Percentage of subject companies under each rating * Percentage of subject companies within each of the categoryBUY (covering Action List BUY, BUY and three categories (BUY, HOLD and REDUCE) for which Spec. BUY ratings), HOLD and REDUCE (covering TD Securities Inc. has provided investment banking TENDER and REDUCE ratings). services within the last 12 months.

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Analyst Certification Each analyst of TD Securities Inc. whose name appears on page 1 of the research reports accessible on this website hereby certifies that (i) the recommendations and opinions expressed in the research report accurately reflect the research analyst's personal views about any and all of the securities or issuers discussed herein that are within the analyst's coverage universe and (ii) no part of the research analyst's compensation was, is, or will be, directly or indirectly, related to the provision of specific recommendations or views expressed by the research analyst in the research report. Disclaimer This report is produced entirely by TD Securities Inc. Although the information contained in this report has been obtained from sources that TD Securities Inc. believes to be reliable, we do not guarantee its accuracy, and as such, the information may be incomplete or condensed. All opinions, estimates and other information included in this report constitute our judgment as of the date hereof and are subject to change without notice. TD Securities Inc. will furnish upon request publicly available information on which this report is based. TD Securities (USA) LLC has accepted responsibility in the United States for the contents of this research. TD Securities Limited has accepted responsibility in Europe for the contents this report. Canadian clients wishing to effect transactions in any security discussed should do so through a qualified salesperson of TD Securities Inc. Canadian retail investors are served by TD Waterhouse Canada Inc., a subsidiary of The Toronto-Dominion Bank. U.S. clients wishing to effect transactions in any security discussed should do so through a qualified salesperson of TD Securities (USA) LLC. European clients wishing to effect transactions in any security discussed should do so through a qualified salesperson of TD Securities Limited. Insofar as the information on this report is issued in the U.K. and Europe, it has been issued with the prior approval of TD Securities Limited and only to persons falling within Articles 19 and 49 of the Financial Services & Markets Act 2000 (Financial Promotion) Order 2001, namely persons sufficiently expert to understand the risks involved. This report has been distributed in Hong Kong through The Toronto-Dominion Bank (Hong Kong Branch), which is regulated by the Hong Kong Monetary Authority. TD Securities Limited is providing financial services to wholesale clients in Australia in reliance on Class Order CO 03/1099. No recipient may pass on the information contained in this report to any other person without the prior written consent of TD Securities Inc. TD Securities Inc., TD Securities (USA) LLC and TD Securities Limited are wholly owned subsidiaries of The Toronto-Dominion Bank. TD Securities Limited is authorised and regulated by the Financial Services Authority. Copyright 2012 by TD Securities. All rights reserved. Full disclosures for all companies covered by TD Securities can be viewed at https://www.tdsresearch.com/equities/disclosures by TD Securities institutional equity clients.

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Head of Equities Robbie Pryde, Vice-Chair and Executive Vice-President, 416 308 9728 CANADA
RESEARCH J.P. Benson, CFA, Head of Research 416 983 6714 Alison Gilbert, Assistant Director of Research 416 944 5345 Investment Strategist John Aitkens 416 307 9366 Alternative Energy Sean Steuart, CFA 416 308 3399 Biotechnology and Health Care Lennox Gibbs 416 308 2213 Metals & Minerals Greg Barnes 416 983 9588 Daniel Earle 416 308 7906 Steven J. Green, CFA 416 307 6304 Craig Miller 416 982 2753 Chemicals & Fertilizers Paul DAmico, CFA 416 983 2755 Communications Vince Valentini, CFA 416 944 7012 Financial Services Jason Bilodeau, CFA 416 308 3741 Doug Young, CFA 416 308 2361 Graham Ryding 416 308 4416 Gold & Precious Minerals Greg Barnes 416 983 9588 Daniel Earle 416 308 7906 Steven J. Green, CFA 416 307 6304 Scott Parsons, CFA 416 308 3404 Industrial Products Paul DAmico, CFA 416 983 2755 Michael Tupholme, CFA 416 307 9389 Cherilyn Radbourne, CA, CFA 416 308 3403 Media Scott Cuthbertson 416 983 3954 Michael Elkins, CA, CFA 416 983 6809 Merchandising & Consumer Products Jessy Hayem, CFA Montral 514 289 0385 Michael Van Aelst, CFA Montral 514 289 0518 Oil & Gas Roger Serin, P. Eng. Calgary 403 299 7964 Menno Hulshof, CFA, MBA Calgary 403 299 8658 Jamie Somerville Calgary 403 299 8586 Scott Treadwell Calgary 403 299 3296 Travis Wood Calgary 403 292 1222 Grant Strem, P. Geol. Calgary 403 292 1244 Juan Jarrah, P. Eng. Calgary 403 299 3494 Wael B. Halaoui Calgary 403 292 2804 Paper & Forest Products Sean Steuart, CFA 416 308 3399 Graham Meagher, CFA 416 982 5777 Pipelines, Power and Utilities Linda Ezergailis, P. Eng. 416 983 7784 Robert Hope, CFA 416 983 9717 Quantitative and Technical Analysis Chris Dutton, CFA 416 308 1554 Real Estate & Hospitality Sam Damiani, CFA 416 983 9640 Jonathan Kelcher, CFA 416 307 9931 Special Situations Damir Gunja 416 983 4186 Jessy Hayem, CFA Montral 514 289 0385 Cherilyn Radbourne, CA, CFA 416 308 3403 Michael Tupholme, CFA 416 307 9389 Technology Scott Penner, CFA 416 308 3406 Transportation (Aerospace, Railroads, Trucking) Tim James, CFA 416 308 9773 Damir Gunja 416 983 4186 Cherilyn Radbourne, CA, CFA 416 308 3403 PRODUCTION Editor Desktop Pubishers: Jean Gagnon Charlotte Daughney Matthew Malowney George Stratis Greg Uchiyama Luke Earl Merv Mendes Karolina Drozd PREFERRED SHARES John Boquist Sue Enrich, CFA ALTERNATIVE INVESTMENT STRATEGIES Bruce Langstaff, CFA, Sales Scott MacNicol, Trading Tom Grant, Trading Bruce Barker, CFA, Convertible Trading Jason Meiers, Risk Arbitrage Don Ritchie, Sales Mark Ferguson, Sales Research Brian Morrison, CA, Research Chris Rankin, CFA, Research EQUITY INDEX PRODUCTS Peter Haynes, CFA Chris Finora, Trading Trevor Johnson, CFA, Research Alex Perel, Trading Gaurav G. Sharma, Trading Rita Tien, Trading STRUCTURED FINANCE GROUP Dan Carr Todd Hargarten, CFA Vishal Hingorani, CFA Stuart Laslop, CFA John Ley, CFA John Millet Jason Morrow Constantin Staicu DMA & ALGORITHMIC TRADING David Hecht Montral 514 985 4585 416 982 2632 416 307 9323 416 982 2692 416 982 2691 416 307 9702 416 307 8016 416 983 2710

416 983 1623 416 983 2707

416 307 9342 416 982 2674 416 983 2725 416 983 8992 416 982 2690 416 308 7907 416 944 5555 416 944 6868 416 982 2623

Jeet (Tushar) Das Christine Rice, Christine Ferguson Camille Williams 800 699 8015 Fax: 416 982 8107 Montral Fax: 514 289 0569 416 308 0860 Montral 514 289 1266 416 944 5678 Montral 514 289 1268 416 308 9730 Montral 514 289 0789 416 308 2674 416 308 9729 416 944 7015 416 308 9735

SALES

Shane Duff, CFA Marc Fortin Andrew Lee, CFA David Perlman, CFA John Rathwell Benoit Robert Adam Robertson Bruce Shaw Amy Van Arnhem, CFA Tim Wiggan, CFA

Fax: 416 307 8112 416 944 5385 416 308 2499 902 461 0103 416 983 1517 416 307 9339 416 983 1112 Fax: 416 307 8112 416 982 5781 416 982 3208 416 983 4980 416 307 9363 416 308 9980 416 307 7640 416 944 5175 416 983 0986 FAX: 416 307 9379 416 307 8255

TRADING Paul Brehl Daniel Bell

800 267 5482 Fax: 416 982 8107 416 982 2676 Montral 514 985 7777

UNITED STATES
SALES 800 883 6295 / Fax: 212 827 7264 Andrew Wanner, Head of Sales 212 827 7292 Jean-Pierre Becker 212 827 7289 Tom Scott 212 827 7269 Robin Kooyman 212 827 7877 TRADING Kim Pino Joseph La Sala Jeff Peacock, Managing Dir. Chris Ruppenstein Paula Kourian Fax: 212 827 7263 800 801 8202 / 212 827 7302 800 775 4755 / 212 827 7392 800 775 4755 / 212 827 7392 800 801 8202 / 212 827 7302 800 775 4755 / 212 827 7392 Josh Dixon Paul Dotson Ted Haley Seth Huber Robert Mercogliano 800 775 4755 / 212 827 7302 800 775 4755 / 212 827 7392 800 775 4755 / 212 827 7302 800 775 4755 / 212 827 7302 800 775 4755 / 212 827 7392

TD SECURITIES OFFICES
Toronto, Ontario 7th Floor 66 Wellington Street West P.O. Box 1, TD Bank Tower M5K 1A2 Calgary, Alberta 800 Home Oil Tower Toronto Dominion Square 324 - 8th Avenue, S.W. T2P 2Z2 Montral, Quebec Suite 2315 1 Place Ville-Marie H3B 3M5 New York, New York 9th Floor 31 West 52nd Street 10019-6101 Hong Kong The Toronto-Dominion Bank Hong Kong Branch Suite 2210, Two Pacic Place 88 Queensway Hong Kong T: 852.2846.4111

Vancouver, British Columbia Suite 1700 700 West Georgia Street P.O. Box 10052 V7Y 1B6

London, United Kingdom 60 Threadneedle Street London EC2R 8AP T: 44.20.7920.0272

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www.tdsecurities.com