Toromont Industries Ltd. a dealer of Caterpillar heavy equipment, reports its profit fell 18 per cent in the latest quarter but revenue jumped 44 per cent.
The Toronto company said Tuesday it earned $26.2-million, or 34 cents a share, in the third quarter ended Sept. 30, down from $31.9-million, or 50 cents a share, a year earlier.
Revenue rose to $619.4-million from $429.9-million as the company benefited from the acquisition of the Enerflex Systems manufacturing subsidiary earlier this year.
Toromont announced late Monday it is spinning off Enerflex as a public company focused on natural gas production and processing equipment.
Toromont would then focus on its Caterpillar heavy-equipment sales and rentals and CIMCO Refrigeration, another of its key units.
"We believe this transaction will provide compelling long-term value for our shareholders," said Robert Ogilvie, chairman of Toromont's board and its chief executive officer.
"Both companies will be leaders in their respective markets. This spinoff will position each for more robust growth and enhanced profitability."
Toromont's current shareholders will receive stock in both companies and Enerflex will apply to be listed on a public market, subject to various approvals.
In its financial results, Toromont said it is starting to see better markets after it was affected by a squeeze on natural gas drilling caused by low prices and weaker heavy construction industries.
"Results in the third quarter of 2010 continued to strengthen after an extended period of weaker market conditions dampened results through 2009 and into the first quarter of 2010," the company said.
"Stronger results in the third quarter continue the positive trend first experienced in the second quarter of 2010."