Brazil Ultrapar Q2 earnings soar 110% on growing economy

12 August 2010 00:00  [Source: ICIS news]

HOUSTON (ICIS)--Brazilian petrochemical and fuel-distribution firm Ultrapar Participacoes reported on Wednesday earnings of reais (R)196m ($111m, €84m), up 110% from R93m reported for the same time last year as sales outpaced costs.

Second-quarter net sales were R10.4bn, up 7.9% from R9.6bn reported from the same time last year. Cost of sales were R9.6bn, up 7% from R8.9bn reported for the same time last year.

As such, second-quarter gross profit was R822.9m, up 19% from R694.3m reported for the same time last year.

The company attributed the growth to the expanding Brazilian economy, acquisitions and expansion.

In fact, the Brazilian economy grew by 9% year over year in the first quarter, Ultrapar said. The industrial segment grew by 15%.

In addition, the number of light vehicles licensed in Brazil rose by 7% in the first half of the year.

By segment, Oxiteno, the company's petrochemical subsidiary, reported R71m in second-quarter earnings before interest, tax depreciation and amortisation (EBITDA), compared with R29m for the same time last year.

Ultrapar attributed the increase to higher sales volumes and margin recovery. Those increases more than offset an appreciating real.

Oxiteno's domestic sales rose by 18% year over year, the company said. In particular, sales rose to cosmetics, agrochemicals and coatings end markets. Foreign sales fell 7% year over year, due to a decline in spot sales of glycols.

Gas distributor Ultragaz reported second-quarter EBITDA of R83m, up 13% year over year.

Fuel distributor Ipiranga reported EBITDA of R238m, up 19%.

Ultracargo reported EBITDA of R28m, up 1%.

($1 = R1.76)
($1 = €0.76)

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By: Al Greenwood
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