April 22, 2008 / 8:32 PM / 10 years ago

Aastra posts lower profit as sales in Europe fall

TORONTO, April 22 (Reuters) - Business communications company Aastra Technologies Ltd AAH.TO posted a lower first-quarter profit on Tuesday, as sales in Europe, its biggest market, fell almost 9 percent and a strong Canadian dollar also hurt results.

Aastra said it earned C$5.3 million ($5.25 million), or 33 Canadian cents per share, in the three months ended March 31. That was lower than its profit of C$8.2 million, or 50 Canadian cents per share, a year earlier.

Sales fell to C$140 million from C$153.3 million. Sales in Europe declined 8.6 percent to C$117.7 million.

“The company experienced a significant decline in sales in Spain as a result of a shift in the sales model by our main customer in this market,” it said.

“Sales in this region were also negatively impacted by the strength of the Canadian dollar to the euro and Swiss franc compared with the first quarter of 2007.”

Sales in North America dipped to C$22.3 million from C$24.6 million, mostly because of weakness in the United States, Aastra said.

The company announced in February it would buy Ericsson’s (ERIC.O) enterprise communications business for a total of C$110 million and inject it with another C$60 million of working capital. The deal is set to close this month, Aastra said on Tuesday.

The company reported its results after markets closed. During the day, its shares fell C$1.59, or 5 percent, to finish at C$30.16 on the Toronto Stock Exchange.

$1=$1.01 Canadian Reporting by Wojtek Dabrowski; editing by Rob Wilson

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