May 11, 2018 / 12:01 AM / 6 months ago

UPDATE 1-Brazil financial exchange operator B3 misses 1st qtr estimates

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SAO PAULO, May 10 (Reuters) - Brazil’s financial exchange operator B3 SA Brasil Bolsa Balcão missed first-quarter profit estimates on Thursday, as financial expenses with the debt related to the acquisition of Cetip SA concluded last year impacted its bottom line.

São Paulo-based B3’s recurring net income totaled 448 million reais in the quarter, 24 percent below the consensus estimate of 589.5 million reais compiled by Thomson Reuters.

The exchange operator slightly beat estimates for revenue posting 1.1 billion reais, and for recurring earnings before interest, taxes, depreciation and amortization (EBITDA) with 760 million reais in the first quarter.

In a statement, Chief Financial Officer Daniel Sonder said “reduction of debt levels remain a top priority through 2019”. The company had in March 5.7 billion reais in debt, equivalent to 2 times its EBITDA over the last 12 months.

Revenue rose as stock and derivatives markets posted record trading volumes, B3 Chief Executive Officer Gilson Finkelsztain said in a statement.

In a client note, Goldman Sachs’ analysts said were expecting B3 to reach EBITDA margin levels of 70 percent in the near future. The financial exchange operator posted a 68.4 percent EBITDA margin in Q1. (Reporting by Carolina Mandl and Tatiana Bautzer; Editing by Chris Reese, Grant McCool)

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