SAO PAULO, Feb 22 (Reuters) - Fourth-quarter profit at Brazilian consumer goods maker Hypermarcas slumped 56 percent from a year earlier as the financial cost of a weaker currency and repurchases of bonds undercut higher sales and improved operating results.
Net income was 54.9 million reais ($23.3 million) in the three months ending Dec. 31 compared with 124.7 million reais in the same period of 2012, the company said in a statement late Friday.
Profit was in line with the average net income estimate of 56 million reais in a Reuters survey of six analysts. Net sales, or sales minus sales taxes, rose 9 percent to 1.12 billion reais, the same as the average Reuters estimate.
Earnings before interest, taxes, depreciation and amortization, a gauge of operating profit known as EBITDA, rose 23 percent to 252 million reais, in line with the average forecast of 246 million reais.
Those gains were erased by 206.6 million reais of financial costs, more than double the result of a year earlier. Financial costs were inflated by the repurchase of $418.8 million, or 56 percent, of the company’s $750 million of 6.5 percent bonds maturing in 2021.
The company paid a $67.50 premium to investors for every $1,000 face-value of bonds repurchased.
The impact on profit of the buyback was reduced by the sale of assets related to the intellectual property of MSD-unit brands, the company statement said.
The company also had to record financial losses related to the increased real-currency value of dollar liabilities resulting from the real’s decline against the dollar in the period. The average value of Brazil’s real in the quarter was 10 percent less than a year earlier.
$1 = 2.3527 Brazilian reais Reporting by Brad Haynes; Additional reporting by Jeb Blount in Rio de Janeiro; Editing by James Dalgleish