TORONTO, Nov 4 (Reuters) - Auto parts maker Linamar Corp (LNR.TO) reported a 56 percent drop in quarterly profit on Tuesday as volumes fell significantly and costs climbed.
The company, which makes precision automotive components for engines and transmissions, earned C$11.5 million ($10 million), or 17 Canadian cents a share, in the three months ended Sept 30. That was down from a profit of C$25.9 million, or 37 Canadian cents a share, a year earlier.
Analysts had expected earnings of 20 Canadian cents a share, according to Reuters Estimates.
Guelph, Ontario-based Linamar said that earnings from continuing operations were C$3.3 million in the quarter, an 87 percent drop from C$25.9 million posted in the same 2007 period.
Sales in the latest quarter fell to C$540.4 million from C$581.6 million a year earlier, primarily due to a drop in industrial product sales. Restricted credit availability, particularly in Europe, was also a factor, the company said.
It released results after markets closed. During the day, Linamar shares fell 1.5 percent to close at C$8.00 on the Toronto Stock Exchange, near its year low of C$7.50 a share.
During the summer, the company laid off hundreds of workers because of reduced production levels. Aside from the U.S. auto sector’s troubles, it said the strong Canadian dollar and the slowdown in the U.S. construction sector were also factors.
Linamar has plants and offices in Canada, the United States, Mexico, Asia, the United Kingdom and continental Europe. ($1=$1.15 Canadian) (Reporting by John McCrank and Lynne Olver; Editing by Peter Galloway)