UPDATE 1-BM&FBovespa Q2 profit edges above estimates

Thu Aug 12, 2010 7:39pm EDT

* Profit of 305 mln reais slightly above estimates

* Derivatives trading up 28 pct on year, stocks up 29 pct

* Revenue jumps 25 pct, beating forecasts

* Adjusted net income rises to 424.4 mln reais, up 30 pct (Adds trading volumes, revenue, EBITDA in paragraphs 1-7)

SAO PAULO, Aug 12 (Reuters) - Brazil's BM&FBovespa, the world's third-largest exchange operator by market value, said on Thursday its second-quarter profit jumped 63 percent from a year earlier, slightly beating analysts' expectations as investors flocked to local stocks and derivatives.

Net income soared to 305.7 million reais ($172 million) from 188.1 million reais a year earlier, BM&FBovespa said in a securities filing. Adjusted net income, which includes one-off events, jumped 30 percent to 424.4 million reais from a year earlier.

The company was expected to post a profit of 302.1 million reais, according to the average forecast of seven analysts in a Reuters poll. The forecasts ranged from 283 million reais to 316 million reais.

Sao Paulo-based BM&FBovespa, which operates Brazil's stock, commodities and derivatives exchanges, has launched contracts for ethanol and partnered with BlackRock Inc (BLK.N), the world's biggest money manager, and Deutsche Bank AG (DBKGn.DE) to offer Exchange Traded Funds and other products to boost trading volumes.

The company has said it wants to boost trading volumes and diversify away from interest rate futures and stocks, which make up the bulk of its trading revenue.

Trading of derivatives jumped 28 percent year-on-year in the second quarter and was up 8 percent from the first quarter.

The rise in trading helped revenue jump to 527 million reais from 420.6 million reais in the year-ago period, BM&FBovespa said. Analysts had expected revenue to rise to 482.7 million reais on average.

Earnings before interest, tax, depreciation and amortization -- a gauge of operational profitability and cash generation known as EBITDA -- rose 31 percent to 341.7 million reais in the second quarter from the year-ago period.

EBITDA as a proportion of revenue, a measure of profitability known as EBITDA margin, rose to 72.1 percent from 68.7 percent a year earlier.

The company also said in a separate statement that it plans to repurchase up to 1.55 percent of its shares in circulation, or 31 million shares, to boost the value of stock. The transaction, based on the shares' closing price on Thursday of 12.74 reais, could be worth up to 394 million reais. ($1=1.778 reais) (Reporting by Guillermo Parra-Bernal; Writing by Elzio Barreto; Editing by Leslie Gevirtz)

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