Brazil Cielo Q2 net profit doubles, beating forecasts

The company logo for Cielo is displayed on a screen on the floor of the B3 Brazilian Stock Exchange in Sao Paulo, Brazil, July 25, 2019. REUTERS/Amanda Perobelli

SAO PAULO, Aug 2 (Reuters) – Brazilian payments processor Cielo SA ( CIEL3.SA ) said on Tuesday its second-quarter net profit more than doubled, beating analysts’ forecasts, helped by proceeds from the sale of a subsidiary.

The company, controlled by lenders Bradesco ( BBDC4.SA ) and Banco do Brasil ( BBAS3.SA ), posted a net profit of 635.3 million reais ($120.38 million), well above the 285.9 million reais it analysts expected in a forecast compiled by Refinitiv.

Cielo’s earnings were boosted by the sale of its stake in US company Merchant e-Solutions Inc, which was completed in April and added 282 million reais to its valuation.

The total volume of payments processed by the company was 221 billion reais, about a third from last year.

Operating net income, on the other hand, fell 9.7% to 2.54 billion reais, reflecting the loss of revenue from the sale of e-Solutions. Excluding the former subsidiary, revenue increased by 33.7%.

Earnings before interest, taxes, depreciation and amortization (EBITDA) for the quarter were 1.18 billion reais, more than doubling from the year-ago period.

Reporting by Carolina Pulice and Peter Frontini. Editor: Christian Plumb

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