October 29, 2008 / 9:08 PM / 10 years ago

UPDATE 1-MDA profit falls as firm starts US, UK layoffs

TORONTO, Oct 29 (Reuters) - Real-estate data and space technology company MacDonald, Dettwiler and Associates MDA.TO posted a drop in quarterly profit on Wednesday and said it has begun laying off employees as a result of weak housing markets in the United States and Britain.

The company, which earlier this year saw the planned sale of its space robotics and satellite technology business blocked by the Canadian government, said it earned C$242,000, or 1 Canadian cent a share, in the three months ended Sept. 30. That was down from a profit of C$23.5 million, or 54 Canadian cents a share, in the same period a year earlier.

Excluding stock-based compensation expenses and mark-to-market adjustments on related hedges, as well as restructuring charges, earnings would have been 50 Canadian cents a share.

Revenue fell to C$278 million, down from C$292 million a year earlier. The decline was led by the information products division — which includes MDA’s real-estate data business — where revenue fell to C$183 million from C$214 million on “lower market activity”, it said.

“The company is right-sizing its work force and facilities in the United States and the United Kingdom to achieve a lower operating cost base at current market activity,” it said, without specifying the number of job losses or plant closures.

MDA first warned it would restructure and cut jobs in late September. It also warned its earnings would be hurt because of weakness in the housing and lending markets.

Its information systems unit, which includes space robotics, had revenue of C$96 million, up from C$78 million a year earlier.

In May, the Canadian government said it would block the proposed $1.33 billion sale of MDA’s satellite technology business to U.S. rocket-maker Alliant Techsystems Inc ATK.N.

Canada had first halted the deal in part because it feared it might lose control over top-secret satellite images.

It was the first time Ottawa has prevented the sale of a domestic company to a foreign buyer.

MDA released its results after markets closed. During the day, its shares fell 39 Canadian cents to close at C$18.67 on the Toronto Stock Exchange.

$1=$1.22 Canadian Reporting by Wojtek Dabrowski; editing by Peter Galloway

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