The machinery firm expects to record a loss this quarter

Husky Injection Molding Systems is expecting a loss in the first quarter of its financial year, continuing the weak set of results it announced for last year.

The Canadian company made an $18.8m (E15.3m) net profit in the year to 31 July, down from $47.3m (E38.6m) in the previous year. In its outlook for the 2005 fiscal year, Husky said it will face challenges, including improvement of margins through cost reductions and also currency fluctuations. A loss in the current quarter will result from a lower margin product mix, unfavourable foreign exchange and its participation in the K2004 exhibition.

The company’s sales in the 2004 fiscal year were $773.7m (E631.3m), down from $815.7m (E665.6m) in the previous year. Europe was the only region where Husky’s sales increased last year, rising 23% to $292m (E238.3m). This was due in large part to exchange rates, but also to growth in packaging and PET shipments.

Sales decreased by 17% in North America, 16% in Asia Pacific and 18% in Latin America. PET shipments fell in each of these regions. Husky’s fall in sales came despite a healthy intake of orders, up 17% to $838.9m (E684.5m). President and chief executive Robert Schad noted increases in orders for injection moulding machinery in the US and Europe.

Improving profitability will be a focus, he said. “Ambitious targets have been set to reduce product costs through value engineering, global purchasing and improved manufacturing efficiencies.”