May 28, 2010 / 12:10 PM / 8 years ago

UPDATE 1-Heroux-Devtek profit falls on weak industrial sales

* Q4 EPS C$0.14 vs C$0.20

* Sales down 8 pct

* Says commercial aerospace mkt recovery remains fragile

May 28 (Reuters) - Aerospace and industrial manufacturer Heroux-Devtek Inc (HRX.TO) reported a 32 percent fall in quarterly profit, hurt mainly by a decline in sales at its industrial segment, and said recovery in the commercial aerospace market remains fragile.

Existing orders for commercial aerospace can be deferred or cancelled, the company said.

The power generation industry appears to have bottomed out, but is not expected to experience any significant recovery before calendar 2011, the company said in a statement.

“We are anticipating sales to remain relatively stable in comparison with the previous year, assuming no major changes in exchange rate,” the company said.

For the fourth quarter ended March 31, net income was C$4.4 million, or 14 Canadian cents a share, compared with C$6.4 million, or 20 Canadian cents a share, a year ago.

Sales for the company, which recently completed the acquisition of privately-owned toolmaker Eagle Tool & Machine Co, fell 8 percent to C$85 million. Analysts on average were expecting earnings of 14 Canadian cents a share, on revenue of C$79.8 million, according to Thomson Reuters I/B/E/S.

Sales at the industrial segment, which makes industrial gas turbine products and whose key customer is General Electric Co (GE.N), fell 41 percent to C$5.8 million in the quarter.

The drop in sales was due to “soft conditions in the power generation industry, including wind energy, and in the heavy equipment industry,” the company said.

The business jet market appears to have bottomed out and the industry is beginning to see positive signs, it added.

Shares of the Longueuil, Quebec-based company closed at C$5.76 Thursday on the Toronto Stock Exchange. (Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Prem Udayabhanu)

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