Falabella profit in line as Brazil buy boosts sales
SANTIAGO Aug 27 (Reuters) - Chilean retail group Falabella reported a flat second-quarter profit, weathering an economic slowdown in key markets, as sales benefited from a Brazilian acquisition and new stores.
Falabella, the largest company by market value on the Santiago stock exchange and one of Latin America's biggest retailers, reported net income of 105.0 billion Chilean pesos ($190 million) late on Tuesday.
That compared with 105.4 billion a year earlier and estimates of 105.2 billion, according to a Reuters poll.
Sales rose 15 percent to $3.3 billion.
Last year, the group expanded into Brazil by purchasing home improvement chain Dicico.
The company also has operations in Argentina, Peru and Colombia. But nearly three-quarters of its earnings still come from Chile, where retail sales growth has decelerated rapidly during a wider economic slowdown in recent months.
Weakness in Chile led gross margins down 0.5 percentage points from a year earlier. Analysts have been expecting such a squeeze as retailers engage in heavier discounting to woo shoppers.
Shares of Falabella, which have fallen around 17 percent since June, closed on Tuesday at 4,360 pesos, valuing the company at about $18 billion. (Reporting by Rosalba O'Brien; Editing by Lisa Von Ahn)
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