Q1 profits at Braskem plunge 50%

Brazilian petrochemical company Braskem S.A., said its profit for the first quarter halved from last year, hurt mainly by higher raw material costs and selling expenses. Cost of goods sold increased 19% to R$7.60 billion from R$6.40 billion last year, hurt by increased raw material prices. Selling expenses rose 13% to R$229 million from R$203 million last year. Braskem in the statement said, "Margins in the petrochemical industry remained depressed in the quarter due to the combination of limited demand, which reflected the weak economic growth, especially in developed countries, and higher prices for raw materials, mainly naphtha." Naptha prices for the quarter jumped 16% due to higher oil prices reflecting political tensions in Arab region. The prices of resins and basic petrochemicals rose 7 and 8% for the period, respectively. Net revenues for the quarter grew 11% to R$8.23 billion from R$7.39 billion last year, driven by higher sales volume. Braskem's profit for the first quarter profit plunged to R$152 million or R$0.19 per share from R$305 million or R$0.38 per share last year.
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