Mexichem's Q2 profit hurt by weaker peso

Mexican chemical and petrochemical firm Mexichem (BMV: MEXCHEM) reported net income of 804mn pesos (US$63.4mn) in the second quarter of 2010, down 35.6% from 1.25bn pesos in the prior-year period due to the weakening of the peso against the dollar. Sales rose 25.7% to 8.92bn pesos from 7.09bn pesos in 2Q09, which Mexichem attributed to the recovery in the Mexican economy and the incorporation of Ineos Fluor's results during the quarter, the company said in a statement. Ebitda jumped 39.0% to 2.11bn pesos in the period. Net debt at end-June was US$820mn, up US$39.7mn compared to the same time last year. "Based on the recovery in the automotive industry, the important synergies generated through the acquisition of Ineos Fluor, the spike in demand, and increase in our own sales, we are quite optimistic that we will see a very positive second half of the year," the company said. Mexichem is also confident it will receive approval from Mexico's anti-trust commission CFC for the acquisitions of plastic tubes manufacturer Plasticos Rex and PVC resin maker Policyd from Monterrey-based Cydsa at the end of August this year. For the full statement, in English, go to this link; in Spanish, this link