M&A

29 October, 2009

UPDATE 2-Wabtec Q3 profit beats Street by a cent

* Q3 shr $0.57 vs est $0.56

* Q3 rev $330 mln vs est $349.5 mln

* Sees 2009 rev down 12 pct vs pvs est down 10 pct

* Tightens 2009 profit view by $0.10/shr

* Says working on new China JV (Adds details from conference call; share movement)

Oct 29 (Reuters) - Railcar parts maker Wabtec Corp's (WAB.N) quarterly profit was a shade above market estimates, but revenue fell short of expectations and it lowered its full-year revenue outlook on continued difficult conditions in its freight rail business.

The company, which also makes products for locomotives and passenger transit vehicles, said it expects the rail and locomotive industries to be down in 2010 as well.

The transit group, which serves the intercity passenger transit system in North America, was stable in the quarter and sales are expected to remain stable at high levels, the company said on its conference call.

Wabtec, which supplies parts to intercity metro cars, commuter cars and light-rail vehicles, now expects full-year revenue to fall 12 percent, wider than its previous forecast of a 10 percent fall.

The company, however, tightened its profit view for the year to a range of $2.40 to $2.50 a share, compared with its prior view of $2.35 to $2.55.

Wabtec's third-quarter profit of $27.4 million, or 57 cents a share, was ahead of analysts expectations helped in part by a 11 percent drop in operating expenses. It earned $33.1 million, or 68 cents a share in the year-ago quarter.

Revenue fell 17 percent to $330 million. Sales from the freight unit accounts for about 40 percent of the company's total results. [ID:nWNAB6581]

Wabtec was working on an additional joint venture in China, company executives said on its conference call, without giving any details.

The company already has one JV operation - formed in December, 2008 - in place to manufacture friction products for the Chinese rail market.

Earlier this year, Wabtec also acquired Unifin, a cooling systems maker for the power industry, for $93 million.

Wabtec shares were up 55 cents at $38.19 in late morning trade Thursday on the New York Stock Exchange. (Reporting by A.Ananthalakshmi in Bangalore; Editing by Maju Samuel and Savio D'Souza)

Source: http://www.reuters.com