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CAE more than doubles Q1 profit

Aug. 8, 2013, Montreal - CAE slightly missed analyst profit expectations even though its net profit more than doubled to $45.6 million in the first quarter of its fiscal year on a 15 per cent growth in revenues primarily due to the strength of its civil simulator and flight training business.


August 8, 2013
By The Canadian Press

The Montreal-based company earned 18 cents per share attributable to
shareholders for the three months ended June 30. That compared to eight cents per share or $21.5 million a year earlier.

Excluding
one-time tax benefits and severance costs, its adjusted profit was
$31.8 million or 15 cents per share, compared to $46.9 million or 18
cents per share in the prior year.

Revenues for the quarter were $530.4 million, up from $462.2 million last year

CAE's
adjusted profits were expected to slip one cent to 17 cents per share
on $525.4 million of revenue, according to analysts polled by Thomson
Reuters.

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Chief executive Marc Parent said the company maintained
its market leadership with strong full-flight civil simulator sales and
higher military orders than last year.

"In civil, despite
disappointing margin performance this quarter, 23 full-flight simulator
sales fiscal year to date give us a strong start and we expect to reach a
record of 40 units by March 31,'' he said in a statement.

On
Thursday, CAE announced a contract for eight simulators, flight training
devices and a 15-year maintenance and service agreement with an
undisclosed customer. The contract signed in CAE's second quarter is
worth about $210 million at list prices.

Revenue from its civil
segments increased 27 per cent to $301.8 million, but segment operating
incomes fell to $37.6 million from $46.9 million last year.

The
company also said it was chosen to train U.S. Air Force crews to operate
Predator and Reaper remotely piloted aircraft, commonly called drones.
The initial one-year services contract is for US$20 million and could be
worth up to US$100 million if extended to the maximum.

The
contract – originally announced by the U.S. Defence Department on July
30 – was one of several disclosed by the company ahead of its annual
meeting of shareholders and a conference call with analysts.

CAE
also said it has been awarded a contract worth an undisclosed amount to
provide three mission training simulators for the Royal Australian Air
Force.

It signed an agreement in June with Lockheed Martin, the
U.S. manufacturer of the F-35 fighter jet, to deliver training system
support and services in Canada even though the federal government has
yet to decide whether it's replacing the existing fleet of CF-18s.

During the first quarter, CAE's military revenues increased by one per cent to reach $198.8 million.

Parent said the orders demonstrate "our resiliency in a challenging defence budget environment.''

New
core markets for health and mining simulator products earned $1.6
million on $29.8 million of revenues, up from $700,000 on $26.1 million
of sales last year.

The company employs about 8,000 people at more than 100 sites and training locations in approximately 30 countries.