Sao Paulo, Brazil-based
Companhia de Saneamento Basico do Estado de Sao Paulo, or
SABESP's
(
SBS
) net income in the fourth quarter of 2011 plummeted 14.2% year
over year to R$493.0 million (US$273.9 million) or R$2.16 per share
(US$2.40 per ADR).
In the fiscal year 2011 also, net income fell by roughly 25.0%
year over year to R$1,223.4 million (US$732.6 million) while
earnings per share were at R$5.37 per share (US$6.43 per ADR).
Earnings per ADR were in line with the Zacks Consensus Estimate of
US$6.43 per ADR.
Revenue:
Revenue in the quarter jumped 10.7% year over year to R$2,701.8
million (US$1,501.0 million).
Billed water and sewage volume in the quarter went up by 2.8%
year over year to 898.5 million cubic meters. Of the total volume
reported, roughly 57.8% represented water variation and 42.2% came
from of sewage. The increase in billed water and sewage volume was
due to higher number of connections and acceleration in
consumption.
Water loss rate in the fiscal year 2011 was at 25.6% versus
26.0% in 2010. Water volume produced increased 1.4% year over year;
water connections soared 2.5% and sewage connections rose by
3.6%.
In the year 2011, consolidated net revenue improved 7.7% year
over year to R$9,941.6 million (US$5,953.1 million) and fared well
exceeding the Zacks Consensus Estimate of US$5,874 million.
Margins
SABESP's cost of sales and services, as a percentage of revenue,
soared to 60.7% from 56.3% in the fiscal year 2010, thus hitting
the gross margin by 4.4%. Operating expenses, including selling,
administrative and other expenses increased in the fiscal and
settled at 15.7% of total revenue versus 14.8% in the previous
year.
EBITDA in the year was around R$3,213.3 million (US$1,924.1
million), down 0.3% year over year with a margin of
32.3%.
Balance Sheet
Exiting the fiscal year 2011, SABESP's cash and cash equivalents
increased 8.1% to R$2,150.0 million (US$1,156.0 million).
Loans and financing, net of current portion decreased 0.8% to
R$6,966.3 million (US$3,745.3 million).
Cash Flow
Net cash flow from operating activities jumped by 30.4% year
over year to R$2,717.1 million (US$1,627.0 million). Capital
spending on property, plant and equipment together with intangible
assets were R$2,211.1 million (US$1,324.0 million).
Following its fiscal year 2011 earnings announcement, SABESP
keeps up its position as the largest water and sewage services
provider in the world, serving roughly 7.5 million customers for
water and 5.9 million for sewage.
The company faces stiff competition from
Veolia Environnement S.A.
(
VE
), a privately held Thames Water Holdings plc, and GDF Suez
(GDFZY.PK).
SABESP -ADR (
SBS
): Free Stock Analysis Report
VEOLIA ENVIRON (
VE
): Free Stock Analysis Report
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