Cap Falls as Mining Costs Pare Quarterly Profit

Cap SA (CAP), Chile’s largest steel producer and iron miner, fell for a third straight day as an increase in operating costs led to quarterly earnings that trailed analysts’ estimates.

The shares fell 2.6 percent to 10,549 pesos at 3:20 p.m. in Santiago, the lowest level on a closing basis since Oct. 29. The IPSA benchmark index retreated 1.2 percent.

Cap reported a profit of $64.2 million in the third quarter, below the $85.2 million average forecast of three estimates compiled by Bloomberg. Banco Santander SA (SAN) analysts cited in an e-mailed research note to clients a 26 percent increase in mining costs from a year earlier that overshadowed a 24 percent advance in iron-ore shipments and an 11 percent gain in prices.

“Costs continue to rise in mining and steel,” Rodrigo Ordonez and Francisco Errandonea of Santander wrote. “This was the main surprise to our estimates and market consensus.”

To contact the reporter on this story: Eduardo Thomson in Santiago at ethomson1@bloomberg.net

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

Bloomberg reserves the right to edit or 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.