Wabco hits low on cuts to outlook, work force

NEW YORK - Shares of Wabco Holdings Inc. plunged to their lowest price ever Wednesday after the automotive supplier reported lower-than-expected quarterly earnings, reduced its 2008 profit forecast, suspended stock buybacks and said it would slash 1,000 jobs.

Wabco said it would make half of the job cuts through attrition of temportary employees. The company said the work force reduction is "in anticipation of further market declines." According to Capital IQ, Wabco has 6,260 employees.

Wabco shares dived $2.78, or 14.4 percent, to $16.49 in midday trading. Earlier, the stock hit $11.56, its lowest price since its initial public offering in early 2007 and far below its 52-week low of $17.52.

The company said it swung to a third-quarter profit of $63.7 million, or 97 cents per share, including a tax gain of $10 million. In the same period a year earlier, the company posted a loss of $300,000, or less than a penny per share.

Excluding items, profit was 94 cents per share in the latest quarter.

Analysts polled by Thomson Reuters expected Wabco to report profit of 98 cents per share. Analyst estimates typically exclude one-time items.

Sales jumped 10 percent to $655 million from $595.5 million, but missed Wall Street's projection for $715.3 million.

The company also reduced its 2008 adjusted profit forecast to a range of $3.85 to $3.95 per share from a previous forecast of $4.12 to $4.26 per share. Analysts expect profit of $4.19 per share.

Companies that make parts for commercial vehicles have seen their sales tumble in recent months as a result of lower production of the heavy duty vehicles stemming from high fuel prices, a weak overall economy and tight credit markets.

Some are expected to cut jobs. Tenneco Inc., which makes emission and ride control systems for automobiles, said Wednesday it plans to cut 1,100 jobs and close five facilities amid the industry downturn.

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