ICA Rises on Smaller-Than-Forecast Sales Drop: Mexico City Mover

Empresas ICA SAB (ICA*), Mexico’s largest construction company, advanced the most in a month after reporting a second-quarter sales decrease that was smaller than analysts had projected.

The shares surged 3.6 percent to 24.66 pesos at 1:01 p.m. in Mexico City, the biggest gain on a closing basis since June 26. Today’s rally was the best performance on Mexico’s benchmark IPC, which fell 1.2 percent.

ICA said July 26 that revenue in the three months through June fell 34 percent from a year earlier to 8.21 billion pesos. The average estimate of four analysts surveyed by Bloomberg was for sales of 8.05 billion pesos. The company’s shares have plunged 26 percent since May 17, when Moody’s Investors Service lowered the builder’s debt to B2, five levels below investment grade, citing delays in public-works spending and saying further cuts were possible.

“This gives ICA some breathing room,” Esteban Polidura, an analyst at Deutsche Bank AG in Mexico City, said in a telephone interview. “After these numbers, a change of outlook to stable would be possible.”

The company posted a net loss of 500.9 million pesos, its biggest on a quarterly basis since 2007.

To contact the reporter on this story: Newley Purnell in New York at npurnell1@bloomberg.net

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

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.