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MRV Declines as New-Project Starts Drop by Half: Sao Paulo Mover

MRV Engenharia (MRVE3) & Participacoes SA fell the most in a month after the homebuilder said it started half as many new projects in the fourth quarter as it did a year earlier and 2012 sales trailed projections by 24 percent.

Shares declined 3.3 percent to 11.12 reais at the close of trading in Sao Paulo, the steepest drop since Dec. 11. The benchmark Bovespa index slipped 0.4 percent.

MRV started 666 million reais ($326 million) of new projects in the fourth quarter, down from 1.39 billion reais a year earlier, according to a regulatory filing late yesterday. The Belo Horizonte, Brazil-based homebuilder reported preliminary sales of 3.43 billion reais for all of last year. The company had projected 2012 sales of 4.5 billion reais, according to a statement on its website.

“Launchings were disappointing and raised our concern on demand in certain regions for MRV’s products,” a team of analysts at Credit Suisse Group AG (CSGN) led by Guilherme Rocha wrote in a note to clients dated today.

Approximately 72 percent of the projects MRV started in the fourth quarter of 2012 are located in southeastern Brazil, according to yesterday’s filing.

Helbor Empreendimentos SA (HBOR3), Brazil’s cheapest homebuilder on a price-to-earnings basis, slumped 5.1 percent today to 12 reais in its biggest decline since June 11. The company said in a regulatory filing after the market closed yesterday that sales dropped 31 percent in the fourth quarter to 389.5 million reais.

MRV gained 12 percent in 2012. Helbor was the best performer among Brazilian homebuilders last year, with an 82 percent gain during that same period, while the BM&F Bovespa Real Estate index advanced 22 percent.

To contact the reporter on this story: Denyse Godoy in Sao Paulo at dgodoy2@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

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