CAE to cut 300 jobs as Europe defense spending falls
(Reuters) - Canada's CAE Inc (CAE.TO: Quote) CAE.N, an aviation trainer and flight simulator maker, posted a higher quarterly profit, but said it would cut about 4 percent of its workforce as it expects reduced defense spending in Europe.
Montreal-based CAE, which employs 8000 people, said it is seeing lower activity in Europe, prompting it to cut 300 jobs.
The company expects to take a restructuring charge of about C$25 million in the first half of fiscal 2013.
The United Kingdom and Germany are among the company's largest military customers and about a third of CAE's revenue comes from Europe. The company is indicating problems with them, Stonecap Securities analyst Scott Rattee told Reuters.
The company posted a fourth-quarter net income of C$53.2 million, or 21 Canadian cents per share, compared with C$45.5 million, or 18 Canadian cents per share, a year ago.
Revenue rose 9 percent to C$506.7 million.
Revenue at its military segment rose 4 percent to C$267.1 million, contributing more than half of the company's total revenue. Combined civil segments revenue rose 9 percent to C$215.4 million.
Analysts on an average were expecting the company to earn 19 Canadian cents per share on revenue of C$508.2 million, according to Thomson Reuters I/B/E/S.
CAE also named Gene Colabatistto as Group President, military simulation products, training and services, replacing Martin Gagne, who retired from the company.
The company's shares were slightly down at C$10.29 on Wednesday on the Toronto Stock Exchange.
(Reporting by Maneesha Tiwari in Bangalore; Editing by Roshni Menon)
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