Brazil's Cielo sees challenging year in 2015
SAO PAULO Oct 29 (Reuters) - Cielo SA, Brazil's largest card payment processor, sees a challenging year ahead as an economic slowdown in Latin America's largest economy leads to slower growth and tougher competition.
"We will have a very challenging 2015, and we may eventually suffer the consequences of a sharp slowdown in consumption," Cielo's Chief Executive Officer Romulo Dias said in a conference call to discuss third-quarter earnings on Wednesday.
Profit at Cielo beat estimates in the quarter as robust prepayment revenue helped offset steady transaction volumes and higher costs and expenses.
The Barueri, Brazil-based company is evaluating opportunities in the health and education industries, Dias said, adding that growth in the card payment sector as a whole would likely be slower next year and that competitors had begun lowering prices.
Cielo earned 820.5 million reais ($337.7 million) in the quarter, topping the average estimate of 808 million reais in a Reuters poll of eight analysts. Profit rose 3 percent and 18.7 percent on quarterly and annual bases, respectively, according to a securities filing on Tuesday.
At 11:36 a.m. local time (1336 GMT), Cielo shares erased early gains to trade 0.20 percent lower at 39.20 reais after having risen as high as 39.98 earlier in the session.
($1 = 2.43 Brazilian reais)
(Reporting by Alberto Alerigi Jr.; Writing by Asher Levine; Editing by Meredith Mazzilli)
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