Votorantim swings to profit in Q3

Tuesday, November 29, 2016

Brazilian metals and cement company Votorantim S.A., formerly known as Votorantim Industrial, posted net income of 149mn reais (US$43.7mn) for the third quarter, compared with an 89mn-real loss in the same period last year.

Net revenue was down 13% to 7.35bn reais, the company said in an earnings release.

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Adjusted Ebitda fell to 1.31bn reais from 1.62bn reais. The Ebitda margin shrank to 17.8% from 19.2%.

Cost of goods sold was 5.63bn reais, 13% lower than in 3Q15, mainly because of "lower sales volumes, the temporary suspension of the nickel operation and the effect of the stronger BRL [Brazilian real] on the consolidation of our businesses abroad," the company said.

In Votorantim's metals division, electrolytic zinc sales increased 6% to 154,000t in the quarter, while aluminum sales were flat at 86,000t.

Long steel sales fell 6% to 455,000t, while the steel segment's adjusted Ebitda came in at 86mn reais, down 43%.

Capex in Q3 decreased 23% to 712mn reais, with 65% corresponding to expansion projects and 35% to the areas of maintenance, modernization, safety, health and the environment.

In January, Votorantim streamlined the corporate structure of its holding companies: Votorantim Industrial merged with Votorantim Participações with the resulting entity – the parent of the group – named Votorantim S.A.