June 9, 2011 / 3:30 PM / 7 years ago

UPDATE 1-Armtec's shares sink on div suspension

(Adds analyst quotes and details; Updates share movement)

June 9 (Reuters) - Shares of Armtec Infrastructure Inc fell 60 percent to a lifetime low on Thursday, a day after the company said it suspended its quarterly dividend indefinitely and posted a wider quarterly loss.

The Canadian infrastructure and construction materials company blamed harsh weather conditions across the country leading to margin compressions, which have continued into the second quarter forcing it to suspend dividend until further notice. [ID:nASA02AFP]

The decline in gross margin showed that pricing environment had not fully recovered, Canaccord Genuity analyst Yuri Lynk said.

The company was paying an annual dividend of C$1.60 a share.

“Margins are not anticipated to improve until later in 2011,” Lynk said.

He placed his rating on the company’s stock “under review” from “buy”.

The company had a long-term debt of C$273.3 million as of Dec. 31, 2010, according to Thomson Reuters data.

Shares of the company — the top percentage loser on the Toronto Stock Exchange — was down 56 percent at C$4.65 in morning trade. Earlier in the session, it had touched a low of C$4.25. Over 2 million shares had changed hands by 1516 GMT. (Reporting by Aftab Ahmed in Bangalore; Editing by Joyjeet Das and Sriraj Kalluvila)

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