February 26, 2009 / 9:58 PM / in 9 years

UPDATE 1-Onex loss soars, sees "dislocated" credit markets

* Diversified group lost C$348 million in Q4 * Net loss C$283 million, or C$2.30 a share, in 2008 * Prepares for prolonged contraction

TORONTO, Feb 26 (Reuters) - Private-equity group Onex Corp OCX.TO posted a ballooning quarterly loss on Thursday and said the companies in which it has invested are clamping down on costs amid the economic crisis.

Onex, which has investments in industries as diverse as electronics manufacturing, health care, movie theaters and cosmetics, said it lost C$348 million ($278 million) in the the fourth quarter ended Dec 31. That was worse than the loss of C$10 million a year earlier, it said.

“This is one of the most tumultuous economic environments experienced by businesses around the world,” Chief Executive Gerald Schwartz said in a statement.

“Global equity markets have suffered some of the largest losses in history and, despite efforts by central banks to stabilize the global financial system, credit markets remain severely dislocated.”

Cashflow from operations dropped to C$384 million from C$597 million a year earlier. Revenue rose 13 percent to C$6.8 billion, the company said.

Onex didn’t provide quarterly per-share figures and said its results don’t follow any specific trends because of its buying and selling of businesses, the impact of foreign exchange and “varying business cycles” at its operating companies.

It did provide a full-year per-share figure, saying its net loss was C$283 million, or C$2.30 a share, in 2008. That compared with a profit of C$228 million, or C$1.78 a share, for 2007.

Schwartz said the companies owned by Onex and its funds are getting ready for a protracted downturn and are adjusting their costs accordingly.

“In preparation for a prolonged contraction, our operating companies continue to be acutely focused on reducing costs and managing capital spending,” he said.

Onex’s direct investments include contract electronics maker Celestica Inc CLS.TO and movie exhibitor Cineplex Entertainment CGX_u.TO.

The Toronto-based company released results after markets closed. During the day, its shares rose 29 Canadian cents to close at C$16.64 on the Toronto Stock Exchange.

$1=$1.25 Canadian Reporting by Wojtek Dabrowski; editing by Rob Wilson

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