B3’s profit rises 25% and CCR reverses losses
The corporate news was quite hectic with the results season in particular, with the fourth quarter numbers for B3, Hering, CCR and more. The Pão de Açúcar Group announced an agreement to sell real estate. B3, the operator of the Brazilian Stock Exchange, showed a net profit of $159 million, the CCR group recorded a profit of $85 million, and the Cia Hering presented a net income of $13.7 million.
The operator of the Brazilian Stock Exchange B3 closed the fourth quarter of 2019 with a net profit of $159 million (R$732.9 million), which represents an increase of 25.7% compared to the same period last year. The accumulated profit was $588.8 million (R$2.71 billion), 29.9% higher than in 2018. The company’s recurring net income rose from 20.9% to $188 million (R$864.5 million) in the last three months of last year, while in 2019 it closed at $3.23 billion.
B3’s recurring EBITDA (earnings before interest, taxes, depreciation, and amortization) totaled $256 million (R$1.17 billion) in the fourth quarter, up 29.1% over the figure seen a year earlier. In 2019, the operator saw its Ebitda increase by 24.4%, to $924 million (R$4.25 billion).
The company’s recurring Ebitda margin (percentage ratio between operating generation and net revenue) was 74.7%, compared to 69.6% in the fourth quarter of 2018. The net revenue, in turn, was $342 million (R$1.57 billion) between October and December of last year. The value is 20.2% higher than the result registered in the same period last year ($285 million (R$1.31 billion)). While B3’s revenues rose, expenses were stable at $143 million (R$656.6 million) in the fourth quarter. Over the whole year, however, expenses increased by 10% to $581 million (R$2.67 billion).
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The CCR Group with a profit of $85 million
The CCR Group, which owns infrastructure concessions, recorded a profit of $85 million (R$392.6 million) in the fourth quarter of 2019, reversing the loss of $67 million (R$307.1 million) registered one year earlier. Adjusted earnings before interest, taxes, depreciation, and amortization (Ebitda) jumped 180.4% in the last quarter of 2019, to $325 million (R$1.5 billion), in the annual comparison.
Net revenues increased by 18.4% between October and December 2019 compared to the same period of the previous year, to $574 million (R$2.64 billion). The data is adjusted by the IFRS criterion and considers only the assets controlled by the group.
The company also disclosed the “same basis” data, which excludes new business, changes in holdings and non-recurring effects. Following these criteria, in the fourth quarter of 2019, compared to the fourth quarter of 2018, there was a 3% decrease in net income to $108 million (R$499.2 million). Ebitda rose 19.6% to $1.63 billion. Net income increased by 14.4%, to $554 million (R$2.55 billion).
According to Marcus Macedo, CCR’s Investor Relations Manager, the fall in profit on the same basis can be explained by the approaching end of some concessions. “The asset depreciation curve is higher, despite the good operating result,” said the executive.
Considering the year 2019, the impact was even greater: a 15.2% drop in net income on the same basis in relation to 2018, to $1.38 billion. Among the concession contracts close to the end are CCR NovaDutra (contract closes in February 2021) and CCR RodoNorte (November 2021).
Still, within the same baseline, the 2019 Ebitda rose 12.7% to $1.2 million (R$5.51 billion). In the same period, net revenues advanced 8.8%, to $1.8 million (R$8.65 billion). Within the IFRS criteria, from 2018 to 2019, there was an 83.8% increase in net income to $312 million (R$1.43 billion). Adjusted EBITDA advanced 42.2% to $1.3 billion (R$5.79 billion). Net revenue increased by 16.7%, to $2.1 billion (R$9.49 billion).
The company’s net debt rose 1.5%, from $2.9 billion (R$13.7 billion) in the fourth quarter of 2018 to $3 billion (R$13.9 billion) in the last quarter of 2019. The net debt/Ebitda ratio went from 2.8 times to 2.4 times in the interval. “With reasonably low indebtedness, CCR seeks new business this year, whether through auctions or acquisitions,” said Macedo.
Last month, CCR won the dispute for the BR-101/SC concession, a stretch that links to the South Integration Highway (RIS), auctioned by the company last year, which is now managed by CCR ViaSul.
Cia Hering had a net income of $13.7 million
Retailer Cia Hering closed the fourth quarter with a net income of $13.7 million (R$63.2 million), down 34% from the same period in 2018. The result was pressured by the weakness in the company’s sales in the country. In the year to date, the company made a profit of $46 million (R$214.7 million), a 10.3% decrease from the $52 million (R$239.5 million) recorded in 2018.
Meanwhile, the cash generation measured by Ebitda fell 6.9% to $18 million (R$82.7 million), while the gross margin fell to 43.4% in the last three quarters of 2019, against 44.3% in the same period of 2018. Last year, the company’s net revenue rose from $334 million to $336 million (R$1.54 billion to R$1.55 billion). Last year, sales in the domestic market increased by 1%, to $369 million (R$1.7 billion), while sales in the foreign market fell 15.1%, to $9.1 million (R$42.1 million).
The Pão de Açúcar Group
The Pão de Açúcar Group announced an agreement with funds managed by TRX to sell 43 properties where it operates stores of various market flags for about $271 million (R$1.25 billion), with arrangements to rent them for 15 years.
The contracts may be renewed for 15 years and the rent will be equivalent to $5.21 (R$24) per square meter per month, the retail chain said. The properties sold include 2 Extra Hiper stores, 6 Mercado Extra stores, 22 Pão de Açúcar stores and 13 Assaí stores, and occupy an area of 541,675 square meters and have 295,266 square meters built.
(Featured image by Stephen Dawson via Unsplash)
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