PEP posts US$183mn Jan-Sep profit

Argentine holding company Petrobras Energia Participaciones (NYSE: PZE) posted net profits of 524mn pesos (US$182.6mn) for the first nine months of 2003 compared to a 1.48bn peso loss in the same period 2002, the company said in its earnings statement. Petrobras Energia Participaciones ( PEP) owns energy company Petrobras Energia. Operating income increased 7.3% to 953mn pesos due to higher exploration and production (E&P), refining and electricity income, offset by lower petrochemicals operating income and income from affiliates under joint control. However, total sales revenues fell 5% to 3.66bn pesos due to lower E&P and electricity sales, compounded by higher eliminations between businesses and lower sales from affiliates under joint control, offset by higher refining and petrochemical sales. The company's non-operating losses improved to 282mn pesos compared to a 1.7bn peso loss in the same period of 2002, due mainly to the impact of the stronger exchange rate on dollar-denominated debt. The company posted a net gain of 153mn pesos from foreign exchange effects during the nine-month period and a gain from inflation effects of 38mn pesos, offset by a loss on conversion from various offshore investments worth 57mn pesos. Non-operating income from affiliates increased to 173mn pesos from a 626mn peso loss in the same period of 2002, mainly due to improvements at gas transporter TGS and electricity transmission company Transener. During the first nine months of 2003, shareholders' equity increased 11.8% to 4.96bn pesos. Net income for the third quarter alone was 109mn pesos (US$38mn) compared to a 6mn peso loss in the same period last year. The improvement is mainly due to a recovery in margins and sales volumes for the electricity and refining business segments, as well as lower financial, administrative, sales and exploration expenses as a result of the devaluation of the peso, the statement said.