February 9, 2011 / 2:06 PM / 7 years ago

UPDATE 2-CAE sees likely delay in some military revenue

* Revenue from some military deals likely delayed

* EPS C$0.16 VS C$0.15 year-ago

* Revenue up 7 pct to C$411.3 mln

* Shares down 1.2 pct to C$13.14 on TSX (Adds details)

OTTAWA, Feb 9 (Reuters) - CAE Inc (CAE.TO) (CAE.N), a flight simulator maker and aviation trainer, has trimmed its outlook for military revenue growth because of likely delays in U.S. government funding, sending its shares lower.

CAE said on Wednesday it may not get paid on some contracts until next year, forcing it to cut its growth outlook to the high single-digit percentage range. Previously it forecast 2011 military revenue growth of 10 to 12 percent.

The Montreal-based company said it still expects a “strong” fourth quarter and continues to forecast double-digit percentage revenue growth in 2012 for its military unit.

CAE, which has both military and civil aviation customers, reported financial results for its third quarter ended Dec. 31 that were largely in line with market expectations.

“Signs for commercial aviation continue to be positive, with emerging markets still leading the recovery,” Chief Executive Marc Parent said on a conference call.

“Passenger traffic, airline capacity and load factors are all trending positive and ... this bodes well for future demand for our products and services.

CAE posted a profit of C$40.7 million ($41.1 million), or 16 Canadian cents a share, compared with C$37.7 million, or 15 Canadian cents, in the same period a year earlier.

Analysts, on average, had forecast a profit of 16 Canadian cents a share before one-time items, according to Thomson Reuters I/B/E/S.

Revenue rose 7 percent to C$411.3 million, less than the average forecast of C$420.7 million.

A strong Canadian dollar hurt the translation of revenue and profit from foreign subsidiaries, the company said.

CAE shares were down 1.2 percent, or 16 Canadian cents, at C$13.14 on the Toronto Stock Exchange on Wednesday afternoon.

Revenue in the company’s military segment rose 6 percent to C$220.7 million and sales in the civil markets rose 9 percent to C$190.6 million.

CAE has a C$3.2 billion backlog at quarter-end, up from C$2.9 billion in the year-prior period. ($1=$0.99 Canadian) (Reporting by Susan Taylor, editing by Frank McGurty)

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