August 12, 2010 / 9:13 PM / 8 years ago

UPDATE 1-Black Diamond Q2 misses view; sees stronger Q3

* Q2 EPS C$0.18 vs est. C$0.22

* Sees better margins at workforce housing div in Q3

* Sees improved results from energy service div in Q3

* Revenue up 87 pct

Aug 12 (Reuters) - Canada’s Black Diamond Group’s (BDI.TO) quarterly profit fell 16 percent and missed analysts’ estimates, hurt by lower gross margins, but forecast higher revenue and stronger margins in the third quarter.

The company, which rents modular structures and provides energy services, said it expects improved results from energy services, higher revenue and better margins from the workforce housing division and modest strengthening from its BOXX Modular Canada division, in the third quarter.

Second-quarter income fell to C$2.9 million, or 18 Canadian cents a share, from C$3.5 million, or 29 Canadian cents, a year ago.

The company posted an 87 percent rise in revenue to C$31.2 million, helped by the increased scale of operations following the acquisition of Nortex Modular and Paragon Saskatchewan, and the expanded facilities at Sunday Creek Lodges.

Analysts on average expected the company to earn 22 Canadian cents on revenue of C$33 million, according to Thomson Reuters I/B/E/S.

Gross profit margin at 49 percent was lower than last year’s, as most of the revenue came from lodging and ancillary sources which generates lower margins than rental streams, the company said.

Black Diamond shares closed down 3 percent at C$17.50 Thursday on the Toronto Stock Exchange. (Reporting by Gowri Jayakumar in Bangalore; Editing by Vyas Mohan)

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