Embraer Slumps as Second-Quarter Earnings Drop: Sao Paulo Mover

Embraer SA (EMBR3), the Brazilian planemaker that has led gains on the Ibovespa (IBOV) this year, slumped after posting quarterly earnings that trailed analysts’ estimates as jets deliveries declined.

The shares fell 4.7 percent to 20.02 reais at 12:44 p.m. in Sao Paulo after earlier declining as much as 5.1 percent, the biggest intraday drop since April 17. It was the worst performance on the Ibovespa equity benchmark, which lost 0.4 percent.

Embraer’s earnings before interest, taxes, depreciation and amortization fell 19 percent to 427.1 million reais ($189.5 million) in the second quarter of this year from 2012, according to a regulatory filing yesterday after the market closed. That compares with an average estimate of 441.9 million reais among ten analysts surveyed by Bloomberg. The company delivered 22 commercial jets, compared with 35 in the prior period, according to the filing.

“The lower number of deliveries of commercial aircraft is still reflecting last year’s poor backlog impacted by worries about global macroeconomic conditions,” Banco Bradesco SA analysts led by Edigimar Maximiliano Jr. wrote today in a note to clients.

The Sao Jose dos Campos-based Embraer planemaker has climbed 39 percent this year, compared with a 20 percent drop in the Ibovespa.

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

To contact the editor responsible for this story: Brendan Walsh at bwalsh8@bloomberg.net

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