July 29, 2009 / 3:24 PM / 9 years ago

UPDATE 1-Westcast battered by recession, Detroit woes

* Q2 loss C$0.62/shr vs C$0.20/shr

* Sales drop 44 percent to C$49.5 mln

* Quarterly loss worse than analyst forecasts

TORONTO, July 29 (Reuters) - Wescast Industries Inc WCSa.TO reported a larger-than-expected second-quarter loss on Wednesday as the troubles at the big Detroit-based automakers ate into business and sales slumped 44 percent.

Wescast, the largest manufacturer of exhaust manifolds for cars and light trucks in North America, said it had a net loss of C$8.1 million ($7.5 million), or 62 Canadian cents a share, in the three months ended June 28, compared with a loss of C$2.7 million, or 20 Canadian cents a share, a year earlier.

Analysts had expected the company to report a loss of 45 Canadian cents a share, according to Reuters Estimates.

Shares of Wescast were up 8.3 percent at C$2.60 on the Toronto Stock Exchange late Wednesday morning, while the broader industrial index was down more than 1 percent.

Sales fell 44 percent to C$49.5 million from the second quarter of 2008, reflecting significantly lower revenues at the company’s North American and European operations.

Wescast said sales were “severely impacted” by the global economic crisis and problems at Detroit’s Big Three.

“The company’s primary North American customer base, the Detroit 3 automakers, experienced a 56.3 percent decline in light vehicle production in the second quarter of 2009 compared to the second quarter of 2008,” Wescast noted in a release.

“During the quarter, both General Motors [GM.UL] and Chrysler [CCMLPC.UL] incurred extended plant closures as they reorganized through bankruptcy procedures resulting in very little demand for parts during these shutdown periods.”

$1=$1.08 Canadian Reporting by Andrea Hopkins; editing by Rob Wilson

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