Oct. 27 (Bloomberg) -- Braskem SA, Latin America’s largest petrochemicals producer, expects the drop in the Brazilian real to benefit the company because some of its revenue is in dollars, Chief Executive Officer Carlos Fadigas said.
“The dollar appreciation is positive for the company, the impact in our debt is secondary, not something we worry about,” Fadigas said in an interview in Sao Paulo yesterday at an event for Brazilian industrial companies. “Braskem’s results also depend on the dollar, since petrochemicals is a global industry.”
Banco Itau BBA SA estimates a net loss of 963 million reais ($558 million) for Sao Paulo-based Braskem in the third quarter, according to data compiled by Bloomberg. Braskem’s shares have fallen 31 percent this year through yesterday, while the benchmark Bovespa dropped 18 percent. The real fell 4.3 percent this year and was at 1.74 against the dollar at 8:56 a.m. in New York.
“For the national industry, the higher the dollar gets, the better,” Carlos Fadigas said. “An exchange rate between 1.70 and 1.75 is still low.”
Fadigas said the financial benefit from currency valuations will be applied in future earnings results. The third-quarter results are set to be released on Nov. 10
--With assistance from Lucia Kassai in Sao Paulo. Editors: Will Wade, Jasmina Kelemen
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