Brazil's CBD quarterly operating profit up 15 pct
Brazil's biggest retailer, on Monday reported a 14.8 percent rise in third-quarter operating profit after tighter controls on purchasing costs and better management.
Companhia Brasileira de Distribuicao (CBD), which is known by its Pao de Acucar supermarket chain, said third-quarter operating profit rose to 72.8 million reais ($33 million) from 63.4 million reais during the year-earlier period.
Net profit fell sharply to 70.3 million reais from 171 million reais a year earlier when the result was boosted by a financial services agreement with Brazilian bank Itau.
Gross margin, a measure of profitability, increased to 30.4 percent from 29.8 percent a year earlier.
But same-store sales fell 5 percent in inflation-adjusted terms, which CBD attributed to a fall in food prices and an increase in the cost of durable goods, which reduced consumers' food purchasing power.
With 555 stores spread out across Latin America's largest country, CBD leads the Brazil market ahead of France's Carrefour and Wal-Mart Stores Inc.
In May, French retailer Casino boosted its stake in CBD, paying over $520 million in cash to share control of the country's top vendor.
CBD's net sales increased 3.8 percent from the third quarter last year to 3.2 billion reais. Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 6.8 percent to 293.5 million reais. ($1 = 2.20 reais)
(Published Reuters, November 8, 2005)
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