(Reuters) – Onex Corp (OCX.TO), a Canadian private equity firm, said on Wednesday second-quarter profit slipped after the sale of an asset in the year-earlier period, while operating profit jumped.
Onex, in talks to buy a British autoparts maker Tomkins Plc (TOMK.L) in what would mark the largest private equity deal of the year, reported net earnings of C$80 million compared with C$83 million in the second quarter of 2009.
Earnings in the 2009 quarter included C$184 million of gains that came primarily from the sale of Onex’s remaining ownership in Cineplex Entertainment in April 2009.
The Toronto-based firm said earnings per share were 67 cents Canadian, well above analysts’ expectations for 46 cents a share.
Revenue slipped 1 percent to C$6.0 billion in the quarter, but operating earnings jumped 20 percent, to C$493 million.
Onex said it had about C$935 million in cash and near-cash items at the end of July, with no debt at the parent company and about US$3.8 billion of “third-party uncalled capital” for acquisitions through the Onex Partners and ONCAP Funds.
“Since the beginning of the year, our investment pipeline has grown considerably, returning to more normal levels,” Onex Chief Executive Gerald Schwartz said in a statement.
“We believe there will be attractive opportunities in the current cycle to acquire high-quality businesses to create long-term value.”
Last week, Onex said it would acquire Sport Supply Group (RBI.O) for about $200 million.
In July, it announced a plan in conjunction with the Canada Pension Plan Investment Board to acquire Tomkins, a publicly traded global engineering and manufacturing group.
Before the results, Onex shares closed down 3.68 percent at C$27.19 on the Toronto Stock Exchange.
(Reporting by Pav Jordan; Editing by Frank McGurty)