Linamar Corp. reported a quarterly loss Monday as the auto industry's global slump slashed demand for its parts, but it said it was picking up market share and on track with plans to cut costs and pay off debt.
Linamar, which makes precision components for engines and transmissions, lost $12.6-million, or 19 cents a share, in its first quarter, ended March 31. That was down from a profit of $29.5-million, or 43 cents a share, a year earlier.
Analysts had expected, on average, a loss of 17 cents a share, according to Reuters Estimates.
Guelph, Ont.-based Linamar said that losses from continuing operations were $894,000 in the quarter, compared with earnings of $29.5-million in the 2008 period.
Sales fell to $424.87-million from $614.52-million.
The company said it generated $72.8-million in operational cash flow, $29-million of which was from reductions in working capital.
Linamar's syndicated revolving credit facility was $249.6-million as of March 31, up $32.3-million from Dec. 31.
"Despite Q1 2009 being one of the most difficult economic periods to manage through in our company's history, Linamar has managed to dramatically increase market share, execute on significant cost savings and generate more than $30-million of cash to pay down debt levels," chief executive officer Linda Hasenfratz said in a statement "We have a plan, are successfully executing on such and seeing the results."
During the quarter, some analysts had said Linamar might default on its covenants when $80-million (U.S.) in notes come due in October. But the company said it withdrew $100-million (Canadian) from its credit line in April to put toward the notes.
Linamar said on Thursday, after Chrysler LLC filed for Chapter 11 bankruptcy protection, that it was confident it would recover the majority of receivables owed by the auto maker.
Linamar said the outstanding balance owing from Chrysler that was older than 20 days was estimated at less than $700,000.
The company also said it had limited exposure to General Motors Corp. on receivables.
Linamar declared a quarterly dividend of 3 cents a share.
The company reported its results after market close. Its shares ended the day up 12 cents at $4.49 each on the Toronto Stock Exchange.