Slumping demand in the civil aviation industry ate into CAE Inc.'s profits in the second quarter, the Montreal-based flight simulator firm said Wednesday.

Net earnings were $39.1 million or 15 cents a share, compared to $49 million or 19 cents a share in the second quarter of last year.

The interior of a CAE NH90 simulator, one of many military flight simulator's made by Montreal-based CAE Inc. (Photo courtesy CAE Inc.)

Revenues came in at $364.5 million, down from $406.7 million during the same period last year.

The company cited a slump in the aviation industry overall for the decline. Airplane makers have struggled to deal with dwindling orders for new planes as consumers curbed travel plans during the recession.

Quarterly sales in CAE's civil simulation products segment were posted at $63.9 million, a drop of 44 per cent from the previous year.

"The civil aerospace sector remains a challenge, but our healthy financial position and our diversification among products and services, military and civil markets and our presence on all continents around the world is helping to mitigate its effects," CEO Marc Parent said.

The company also booked a restructuring charge of $1.1 million during the period. CAE said it expects to incur a total charge of $32 million for its restructuring program which is to be completed by the end of the fiscal year.

In the military segment, the company won orders of $178.4 million during the quarter including major upgrade work for two German CH-53 full-mission simulators and a range of A330 Multi-Role tanker transport trainers for the United Arab Emirates and the Royal Saudi Air Force.

Total revenue for the military-focused business was $137.4 million, up nine per cent from $126 million during the same period a year earlier.