By Adriano Marchese
ATS warned that tariffs could affect its U.S.-facing business in the short-term as it reported a decline in profit and revenue in the third fiscal quarter on softer EV demand.
The Canadian automation and technology company said Wednesday that U.S. tariffs on Canadian imports could harm the company in the short term. It added that revenue derived from its Canadian operations being sold into the U.S. has represented a mid-teens percentage of its total revenue for the nine months ended Dec. 29.
President Trump has threatened to impose a 25% blanket tariff on Canadian imports into the U.S. On Monday, Canada and the U.S. agreed to pause them for 30 days, granting a reprieve for companies and investors who are hoping to avoid a protracted trade war.
ATS said it is working with its customers and suppliers to mitigate challenges that the tariffs pose.
The company posted a lower net income of 6.5 million Canadian dollars ($4.5 million), or C$0.07 a share, for the period ended Dec. 29, down from C$47.2 million, or C$0.48 a share, in the comparable quarter a year ago.
Adjusted earnings were C$0.32 a share, missing analyst forecasts on FactSet which expected C$0.35 a share.
Revenues fell to C$652 million from C$752 million. Analysts were expecting a decline to C$651.1 million. The decline was largely in its transportation business, which saw a 79% decline, on the back of softer demand in the EV market in North America.
The company's life sciences segment saw an increase in revenue of nearly 19%. Similarly, revenue at its beverage segment rose 19%.
Order booking in the quarter rose 32% to C$883 million, bringing the backlog up 8% higher than a year earlier to C$2.06 billion. ATS credits the rise to strong organic growth and contributions from its acquisitions.
For the fourth fiscal quarter, revenue is forecasted to be between C$650 million and C$710 million, with analysts expecting about C$701.7 million for the period.
Write to Adriano Marchese at adriano.marchese@wsj.com
(END) Dow Jones Newswires
February 05, 2025 06:43 ET (11:43 GMT)
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