UPDATE 1-Leoni cuts outlook on costly new production line in Mexico
* Now sees EBIT of at least 180 mln euros
* Previously expected more than 200 mln euros in EBIT
* Cost overruns in setting up new production line in Mexico (Adds details on costs, analyst estimates for Q3 results)
By Ludwig Burger
FRANKFURT, Oct 13 (Reuters) - German automotive cable and wiring systems supplier Leoni AG cut its full-year earnings outlook on Monday, citing cost overruns related to a new production line in Mexico.
The group said it now expects earnings before interest and taxes (EBIT) of at least 180 million euros ($228 million), compared with a previous projection of more than 200 million euros.
"The principal reason for this weaker performance in terms of operating profit involves heavy, unplanned charges arising from new product start-ups in the Wiring Systems Division, which already exerted an adverse effect in the second quarter," Leoni said.
A spokesman pointed to remarks made by Chief Executive Klaus Probst in August during a media call discussing second-quarter earnings.
Probst at the time said setting up production facilities to make wiring systems for a German premium carmaker in Mexico had led to higher-than-expected costs for training employees and for air freight. It had previously only produced supplies for U.S. truckmakers in Mexico. Continuación...