SAO PAULO, Feb 7 (Reuters) - Brazil’s Braskem SA, the largest petrochemical company in Latin America, reported its strongest quarterly profit in a 1-1/2 years on Thursday, helped by asset sales and higher Brazilian tariffs on competitors’ imports.
Braskem also said it plans to boost capital spending by 31 percent to 2.244 billion reais this year. A quarter of 2013 investments will go to a new complex in Mexico, with the rest concentrated on higher maintenance spending.
The budget for new capacity in Brazil fell over 70 percent from 2012, highlighting Braskem’s focus on setting up more competitive operations consuming cheap natural gas, like the Ethylene XXI complex it is building with Mexico’s Grupo Idesa.
Braskem said in a securities filing it swung to a fourth-quarter net income of 275 million reais ($138 million) from a loss of 172 million reais a year earlier. It was the best result since a 420 million reais profit in the second quarter of 2011.
A weaker local currency and new trade barriers to protect local industry allowed Braskem to raise prices in the Brazilian market, boosting domestic sales by 16 percent from a year earlier while overall net revenue rose just 8 percent.
Shares of Braskem gained about 4 percent in early trading, nearing a four-month high.
Earnings before interest, taxes, depreciation and amortization, a gauge of operating profit known as EBITDA, nearly doubled from a year earlier to 1.399 billion reais. Excluding one-time asset sales in the quarter, EBITDA rose 23 percent to 883 million reais.
Braskem said it plans to invest 2.2 billion reais in 2013, 70 percent of which will go to maintenance and improvements to productivity.