* Lower pulp prices, risings costs, higher taxes take toll
* High base of comparison also hurt net profit
* Sales increased 7.7 percent last year
SANTIAGO, March 14 Chilean industrial
conglomerate Copec said on Thursday that net profit dropped by
more than half last year on declining wood pulp prices, rising
costs and higher taxes on businesses in Chile.
Also weighing on Copec's bottom line was a high
base of comparison due to a $532 million insurance payment the
company received in 2011 for damages its installations suffered
from a massive earthquake and ensuing tsunami that struck in
Net profit tumbled 56 percent to $409.57 million in 2012
from the prior year, in line with expectations.
"The drop in operational results is due mainly to lower
results in the forestry and fuel sectors ... There was a drop in
sales in the wood pulp business, due to lower average sales
prices and an increase in costs," Copec said in a statement
posted on the local securities regulator's website.
Chile's Congress in September approved changes in tax laws
to help fund an education reform. Businesses in the Andean
nation now face a higher tax rate of 20 percent and fewer
loopholes to evade them, though the rate remains well below
Latin America's average rate of 25.06 percent in 2011, according
to accounting firm KPMG.
Sales at Copec, which owns the world's second-biggest wood
pulp producer and the third-largest commercial fishing company,
as well as the main fuel distributor in Chile and Colombia, rose
7.7 percent in 2012 to $22.761 billion.
EBITDA, or earnings before interest, taxes, depreciation and
amortization, slumped 23 percent last year to $1.559 billion.
Before its earnings were reported, shares of Copec ended 0.6
percent lower on Thursday, roughly in line with the blue-chip
IPSA stock index decline.