October 31, 2008 / 11:40 AM / in 9 years

UPDATE 1-Heroux-Devtek profit rises with higher sales

TORONTO, Oct 31 (Reuters) - Canada’s Heroux-Devtek Inc HRX.TO reported a higher quarterly profit on Friday, on growth in its aerospace and industrial segments.

The Longueuil, Quebec-based manufacturer said it earned C$4.1 million ($3.36 million), or 13 Canadian cents a share, in the second quarter, up from C$3.1 million, or 10 Canadian cents a share, in the year-earlier period.

Operating income was C$6.8 million, up from C$5.2 million, despite the impact of currency fluctuations and higher administrative expenses.

Sales for the period, ended Sept. 30, grew by 10.9 percent to C$77.3 million, from C$69.8 million for the same period last year. Aerospace sales were up 9.4 percent and industrial sales climbed 23.3 percent.

“Once again, all divisions generated higher sales and gross profit,” Gilles Labbe, president and chief executive of Heroux-Devtek, said in a release.

“We are particularly satisfied with robust sales and profitability increases at the Gas Turbine Components Division. Strong military activity was the main driver in Aerospace operations, which remained, however, somewhat affected by unfavorable year-over-year currency fluctuations.”

The company said the stronger Canadian dollar ate into second-quarter sales by 4 percent, or C$2.8 million, compared with last year and lowered the gross profit margin by 2.8 percent. ($1=$1.22 Canadian) (Reporting by John McCrank; Editing by Steve Orlofsky)

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