Bloomberg News

BR Malls Quarterly Profit Rises 56%, Missing Estimates

March 29, 2012

(Corrects currency conversion of story published Feb. 28.)

BR Malls Participacoes SA (BRML3), Brazil’s biggest owner of shopping malls, said net income rose 56 percent in the fourth quarter, missing analyst estimates, as acquisitions boosted sales.

Net income was 90.6 million reais ($49 million) in the three months ended Dec. 31, compared with 58 million reais a year earlier, according to a regulatory filing. The result compares with an average estimate for adjusted net income of 106 million reais among four analysts surveyed by Bloomberg. Net revenue jumped 42 percent to 264 million reais in the quarter.

The results “reflect the very positive operating environment the shopping mall industry is facing currently,” analysts David Lawant, Enrico Trotta and Vivian Salomon from Banco Itau BBA SA wrote in a report distributed to clients today. The wholesale unit of Itau Unibanco Holding SA maintained its “outperform” rating on the stock with a fair value of 26.20 per share.

BR Malls bought four shopping malls in the three months ended Dec. 31, including Shopping Jardim Sul in Sao Paulo for 460 million reais, and increased its participation in three other malls. At the end of 2011, the company held stakes in 45 shopping centers, of which 10 are wholly-owned.

Same-store sales increased 8.8 percent in the quarter, while total sales rose 19 percent to 5.3 billion reais.

BR Malls fell 1.75 percent to 21.28 reais at 1:29 p.m. in Sao Paulo. The stock has gained 19.5 percent this year through yesterday, while the benchmark Bovespa stock index rose 15 percent.

To contact the reporter on this story: Karen Eeuwens in London at keeuwens@bloomberg.net

To contact the editor responsible for this story: Helder Marinho at hmarinho@bloomberg.net;


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