May 14, 2010 / 6:07 PM / 8 years ago

UPDATE 1-Toromont profit falls, sees 2010 market weakness

* Q1 EPS C$0.21 versus C$0.37 a year ago

* Analysts forecast EPS C$0.25

* Revenue down 4 percent at C$440.7 mln

TORONTO, May 14 (Reuters) - Industrial equipment supplier Toromont Industries (TIH.TO) said on Friday its quarterly profit fell 35 percent in a soft market and that it does not expect any meaningful recovery in its businesses this year.

The company, which sells, rents and services a broad range of Caterpillar (CAT.N) heavy construction and industrial equipment, and makes and installs compression systems, said it does not expect its 2010 profits to be as high as they were in 2009.

“General economic conditions in the markets we serve continued to be slow,” Robert Ogilvie, chief executive of Toromont, said of the company’s first quarter results.

He said the results were also hurt by costs associated with Toromont’s C$670 million takeover of Enerflex Systems Income Fund EFXFF.PK in January.

The company said Enerflex, which adds to Toromont’s compression business in the natural gas sector, should add to earnings in 2011.

Concord, Ontario-based Toromont said its profit fell to C$18.6 million ($18.1 million), or 21 Canadian cents a share, for the quarter ended March 31. That was down from C$23.7 million, or 37 Canadian cents a share, a year earlier.

Analysts, on average, had expected earnings of 25 Canadian cents a share, according to Thomson Reuters I/B/E/S.

Toromont said the Enerflex deal led to a C$19.4 million jump in selling and administrative expenses. Transaction and restructuring costs added another C$5.5 million, interest costs related to the transaction financing rose by C$3.8 million, and other related costs came to C$2.2 million.

Earnings also included an C$18.6 million gain on units of Enerflex held by Toromont before the deal.

Revenue dropped 4 percent to C$440.7 million, reflecting weaker economic conditions and a 19 percent increase in the Canadian dollar over the past year, which cut C$19 million from revenues.

Toromont shares were down 81 Canadian cents at C$28.84 on the Toronto Stock Exchange on Friday afternoon after the results were released.

$1=$1.03 Canadian Reporting by John McCrank; editing by Peter Galloway

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