February 10, 2010 / 2:06 PM / 8 years ago

UPDATE 2-CAE profit sags, sees slow civil aerospace rebound

* Q3 EPS C$0.15 vs C$0.20 a year earlier

* Revenue falls 9.8 percent to C$382.9 million

* Analysts expected EPS C$0.15, revenue C$388.5 mln

TORONTO, Feb 10 (Reuters) - Flight simulator maker and aviation training company CAE Inc (CAE.TO) (CAE.N) posted a lower quarterly profit on Wednesday as weakness in its civil aerospace segment outweighed stronger results in its military business.

Profit in CAE’s third quarter, ended Dec. 31, was C$37.7 million ($35.2 million), or 15 Canadian cents a share, down from C$52.1 million, or 20 Canadian cents a share, a year earlier.

Excluding a restructuring charge of C$3.9 million, the Montreal-based company earned C$40.3 million, or 16 Canadian cents a share.

Revenue fell 9.8 percent to C$382.9 million.

Analysts, on average, had forecast a profit of 15 Canadian cents a share before one-time items, on revenue of C$388.5 million, according to Thomson Reuters I/B/E/S.

“The civil aerospace market is showing signs of stabilizing at current low levels,” Marc Parent, CAE’s president and chief executive, said in a statement.

“The eventual market recovery will likely be gradual, and will benefit our civil training segment before our civil products segment. In the meantime, our defense business continues to grow globally and we have continued to invest in CAE’s future.”

During the quarter, CAE said it sold six full-flight simulators and it had one cancellation of a previous order, for a year-to-date total of 14 sold. The company said it sees market opportunities and deals in progress to support its order target of 20 full-flight simulators for the fiscal year.

CAE closed the quarter with a backlog of C$2.92 billion in orders, down from C$2.94 billion a year earlier.

It won military contracts worth C$166.7 million in the quarter. Revenue in the military business was C$207.9 million, up 12 percent from a year earlier.

The company signed agreements in its civil-aviation training and services unit worth about C$86 million. Revenue in civil unit fell 15 percent to C$102.4 million due to softer market conditions in North America and Europe and the negative impact from the appreciation of the Canadian dollar.

CAE shares were down 6 Canadian cents at C$8.65 on the Toronto Stock Exchange at market open on Wednesday.

$1=$1.07 Canadian Reporting by John McCrank; editing by Peter Galloway

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