Ecopetrol profit slump to deal further blow to Colombia coffers
BOGOTA, March 3 (Reuters) - A plunge in earnings at Colombia's biggest company, state-run Ecopetrol, will deepen the Andean country's fiscal deficit this year by up to another $1.43 billion due to lower dividend income, analysts said on Tuesday.
Ecopetrol posted a 43 percent dive in 2014 profit to $3 billion, despite comparatively high oil prices through June after which they more than halved. It lost $338 million in the fourth quarter and analysts say 2015 will likely be worse for the company than last year.
With an 88.5 percent stake in Ecopetrol, the government is set to earn between 4.8 trillion and 5.5 trillion pesos ($1.87-$2.14 billion) in dividends, analysts say, well below the 8.4 trillion the government forecast in December it would receive.
"If Ecopetrol distributes 80 percent in dividends, the gap is almost 3 trillion Colombian pesos ($1.18 billion), and if it distributes 70 percent, the gap will be 3.6 trillion pesos," said Juan David Ballen, analyst at the Casa de Bolsa brokerage.
Finance Minister Mauricio Cardenas says the drop in Ecopetrol's earnings had already been factored into the government's public finances when it announced last week 6 trillion pesos of spending would be delayed.
"The government knew of Ecopetrol's results prior to the cabinet meeting at which the delay in 6 trillion pesos in investments was approved," Cardenas told reporters.
The central government deficit target for 2014 was bumped up to 2.8 percent at the end of last year, from 2.4 percent previously, while the growth forecast for the year was reduced to 4.2 percent from 4.8 percent.
($1 = 2,568.8000 Colombian pesos) (Reporting by Nelson Bocanegra; Writing by Peter Murphy; editing by Andrew Hay)
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