August 6, 2009 / 11:10 AM / 9 years ago

UPDATE 2-Canam profit slumps 57 pct, sees M&A opportunity

* Q2 shr C$0.12 vs C$0.25 year earlier

* Sales fall more than 19 pct

* Sees acquisition opportunities

* Shares dip C$0.03 to C$7.37 (Recasts, adds comments from conference call)

OTTAWA, Aug 6 (Reuters) - Construction products maker Canam Group Inc CAM.TO reported a 57 percent fall in quarterly profit on Thursday, hit hard by a slowdown in nonresidential construction.

But cushioned by a healthy backlog and strong balance sheet, Canam said it expects to say profitable for the remainder of 2009 and have a broad choice of acquisition targets.

“As we enter a more challenging business environment, we’ve seen an increase in the number of acquisition opportunities we are presented with, and we are more than ever convinced that our strengthening balance sheet will be a great asset in the quarters to come,” said Chief Operating Officer Marc Dutil on a conference call with analysts.

The company said second-quarter profit was C$5.2 million ($4.9 million), or 12 Canadian cents a share, versus C$12.1 million, or 25 Canadian cents a share, in the same quarter a year earlier.

Revenue fell more than 19 percent to C$151.2 million.

The results lagged the consensus estimate of analysts, who expected earnings of 15 Canadian cents a share and revenue of C$187.1 million, according to Reuters Estimates.

Canam reported a gross profit margin of 18 percent and forecast margins between 16 percent and 20 percent for the next two quarters.

The company, which designs and manufactures welded beams, joists and girders, said its backlog at quarter-end rose to C$278 million from C$239 million a year earlier.

Under a renewed share buyback program, the Saint-Georges, Quebec-based company may purchase up to 3.6 million common shares, or 10 percent of its public float.

Canam announced earlier this week that it won a contract worth almost C$60 million to help build a retractable roof on the new Florida Marlins baseball park near Miami, Florida.

The company’s shares dipped 3 Canadian cents to C$7.37 on the Toronto Stock Exchange on Thursday. Year-to-date the stock has gained about 6 percent. ($1=$1.07 Canadian) (Reporting by Susan Taylor with additional reporting by Chakradhar Adusumilli in Bangalore; editing by Peter Galloway)

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