May 12, 2010 / 4:00 PM / 7 years ago

Groupe Aeroplan shares down on lower Q1 profit

May 12 (Reuters) - Shares of Groupe Aeroplan AER.TO, which operates Air Canada’s ACa.TO frequent flier program, fell more than 5 percent Wednesday, a day after it posted lower-than-expected quarterly profit hit by higher expenses.

For 2010, Groupe Aeroplan sees gross billings in its legacy businesses growing by 2 percent to 4 percent.

Shares of Montreal, Quebec-based company fell 5 percent to C$10.35 in morning trade Wednesday on the Toronto Stock Exchange.

For the first quarter, net income was C$14.9 million ($14.59 million), or 7 Canadian cents per share, compared with C$23.2 million, or 12 Canadian cents apiece a year ago.

Adjusted earnings per share was 20 Canadian cents a share.

Revenue rose 42 percent to C$506.8 million.

Analysts on average had expected the company to earn 21 Canadian cents per share on revenue of C$514.8 million, according to Thomson Reuters I/B/E/S.

Gross billings rose nearly 50 percent to C$517.9 million.

Expenses for the quarter more than doubled to C$146.4 million, mainly due to the integration of Carlson Marketing and the launch of its Nectar Italia loyalty program. ($1=1.021 CANADIAN DOLLAR) (Reporting by Abhiram Nandakumar in Bangalore; Editing by Don Sebastian)

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