Inuit-owned Kitnuna Corp. continues to face financial challenges

“A restructuring effort … continues to this day,” says Kitikmeot Corp. president

Kitnuna Corp. in Cambridge Bay appears to be facing serious challenges, according to information shared with the Kitikmeot Inuit Association’s’ annual general meeting in Cambridge Bay. (Photo by Jane George)

By Jane George

CAMBRIDGE BAY—Worries about one of Cambridge Bay’s larger private employers, Kitnuna Corp., surfaced at the annual meeting of the Kitikmeot Inuit Association in Cambridge Bay this week.

There are 31 Inuit now employed at the Cambridge Bay–based contracting and service-provider company, which is wholly owned by the KIA’s business arm, Kitikmeot Corp., according to a report tabled at KIA’s annual general meeting on Oct. 1.

“What’s in the future [for employees]—they need more guidance from higher up,” said André Otokiak, Cambridge Bay’s board member, after listening to KC’s report on Kitnuna.

KC president David Omilgoitok told the AGM that “in early 2017 we recognized that Kitnuna was struggling to address growing business challenges.”

“We made the decision to replace its management team and begin a restructuring effort that continues to this day,” he said. “Some of these restructuring decisions are now becoming apparent to the Cambridge Bay community, as certain unprofitable lines of businesses have been wound down.”

In response to Otokiak’s question, Omilgoitok said that KC is trying to “see if we can restore” the company.

That’s all he said he could say publicly.

Last year, KC sold its Kitnuna pharmacy and the Kitikmeot Centre building, which are both now owned by the North West Co. retail chain.

Also in 2018, Kitnuna was one of two subcontractors working on the construction of the Canadian High Arctic Research Station in Cambridge Bay that were fined thousands of dollars after pleading guilty to safety violations that resulted in the injury of a worker in 2015.

Kitnuna pleaded guilty for failing to take all reasonable precautions and carry out all reasonable techniques to ensure the health and safety of every person in the establishment, under the territory’s safety legislation.

Kitnuna was fined $52,173.91 plus a victim-of-crime surcharge of $7,826.09.

No financial reports for Kitnuna nor for KC were presented to the KIA.

KC said last year that it discloses this information to its sole shareholder, the KIA, at their first meeting of every calendar year.

“Due to the commercial, confidential nature of these financial reports, KIA’s board of directors receive this information in camera,” KC said.

“Sharing this information with the general public could impact KC’s businesses and would give our competitors an unfair advantage, especially given the fact that our competitors have no requirement to disclose their own private information to the public.”

Kitnuna, which provides services including fuel supply, project management, general contracting and environmental remediation, was originally a 50-50 joint venture between Nunasi Corp. and Kitikmeot businesses until Nunasi transferred its shares to KC.

In 2015, KC became the sole owner of Kitnuna, which manages a handful of subsidiary companies that operate in Nunavut’s western region.

According to the KC report tabled at the AGM, these companies, like Kitikmeot Camp Solutions, could employ roughly 50 Inuit in addition to those who work directly for Kitnuna.

A downturn in mining work and exploration, also touched on at the AGM, has likely affected Kitnuna: Sabina Gold and Silver Corp., though it has finished going through the regulatory process, is now in a holding position while it waits to raise money to build its $400-million-plus proposed mine, and Glencore Canada Corp. has put its Hackett silver mine project in care and maintenance, meaning the mine site is closed but there’s the potential for operations to resume.

There are only four mining exploration companies now active in the region, the KIA lands department told the AGM—the lowest number on record.

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(16) Comments:

  1. Posted by Northern Guy on

    Since when are annual financial reports “commercial and confidential in nature?” Either these companies have something to hide or both of them are in really big financial trouble. Either way the lack of transparency should be disturbing to the Inuit of the Kitikmeot, after all it is their money.

    • Posted by A Northern Guy Too on

      In Kitnuna’s defense, they are a private entity. They don’t need to disclose their finances. A good example in the north is the two airlines.

    • Posted by Crystal Clarity on

      These are private companies and corporations. They report to boards, not the public. Just because they are the business arm of the KIA doesn’t make them public. Many people fail to realise that.,

      • Posted by Northern Guy on

        To the posters above I fully realize that they are private companies however they are private companies funded with money owned by the Inuit of the Kitikmeot. One needs only do a quick and dirty google search to find any number of private companies that make their financial statements available for public review (this includes both First Air and Canadian North BTW).

  2. Posted by Northern Inuit on

    Kitnuna was a proud Company which helped build and grow Cambridge Bay and Communities in the Kitikmeot Region.

    would be nice to know what Kitikmeot Corporations Plan is for the two Tank Farms in the Community. when will the remediation start?

    maybe you can file it under “business challenges” and hope noone remembers that they belong to Kitnuna.

  3. Posted by OMG on

    The problem is no accountability, mismanagement, everyone being on leave and having “token” people in upper management jobs. When have the books balanced in NU?

    • Posted by Buddy buddy system hire no accountability is right on

      What ever happened with keeping the earnings in Nunavut. KIA president should hold his employees more accountable in high positions. You have more qualified HEO, mechanical team and managers that beneficiaries you can hire. Clean house David

  4. Posted by Questions and Answers Needed on

    Let’s compare last years announcement with this years announcement:

    2018 —> “Business arm of western Nunavut Inuit org says finances are “robust”.”
    2019 —> “Inuit-owned Kitnuna Corp. continues to face financial challenges.”

    When did KC first announce they were facing financial challenges? Last year their finances were “robust”, and now they are “continuing” to face financial challenges? Very suspicious. Inuit own the company, release the financial statements.

    • Posted by Crystal Clarity on

      Private company. private corporation. They report to their boards not the public.

    • Posted by Northern Clarity on

      You misread last years article. The robust comment was referring to the financial status of Kitikmeot Corporation not Kitnuna. This years comment that you are referring to is in reference to Kitnuna’s Financial Situation not Kitikmeot Corporations.

      It would likely be best to read the articles and not just the headline before expressing an opinion. To often do people just jump to the comment section before actually reading the article.

  5. Posted by Observer on

    One of Kitnuna’s biggest problems is that when they were the only significant contractor in town they automatically received all the big contracts, and if you didn’t like the work that was done, tough. Who else were you going to go to? When they started getting competition from other local businesses, they kept assuming they would be getting all the big contracts and wouldn’t have any repercussions from doing poor work, only to wake up one day and found out that wasn’t true any more. And they’ve been struggling ever since.

  6. Posted by Auput on

    Maybe a financial audit and investigation by an independent company For the people of the Kitikmeot is in order. How and when does the KIA explain to its people what struggles they are having and why? You talk about jobs at Kit Corp yet people have had to leave these jobs to find work outside of our community. Buildings are being built to what cost and what perspective value do they have for the regular Inuit person in our region. Not enough transparency or explaining to the people. We are to just believe you do the right thing on our behalf.

  7. Posted by Northern Inuit on

    why is the new Building being built beside the KIA Building in Cambridge Bay?

    The report given by KC was that it is being built for Kitikmeot Corporation.

    why?

    what is wrong with the huge building they are in now? not spending enough money on fuel for this building they feel the need to build another one? not enough Family Members inhabiting the building maybe if they build another one we can use nepotism to fill the rest of the new one?

    would have been nice to have been updated on the $300,000 stolen from Nunavut Development Corporation which is owned by KIA, but I guess they hope we all forgot about that.

  8. Posted by Tom on

    This region KIA always has to get bailed out, whatever planning they do it comes up short and they ask for NTI to bail them out, maybe they need better managers, finance managers, it seems to be going on like its normal to be managed poorly, KIA needs to be better audited that way we all know how and where to fix this organization.
    Who are KIA’s auditors? Is it the same as NTI’s?

  9. Posted by Darren Etibloena on

    Are they still flying in the majority of their workforce from the maritimes?

  10. Posted by Organization on

    Re-org KIA, do a third party HR and Financial Audit. Same with their business arm, plus the subsidiaries. FYI non-relatives, unfriended people need not apply, lol. Such an ineffective, dysfunctional organization-we all know that but how can we change it? Oust the family and current employees?

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