Redecard SA, the Brazilian card-payment processor that Itau Unibanco Holding SA is seeking to buy out, said its first-quarter profit rose 36 percent, beating estimates, after the company cut costs by reducing headcount.
Adjusted net income, which excludes some items, advanced to 381.2 million reais ($202.9 million) from 281.3 million reais a year earlier, the Sao Paulo-based company said today in a regulatory filing. The result was above the mean estimate of 367.1 million reais in a Bloomberg survey of nine analysts.
Operating costs declined 3.5 percent to 134.8 million reais as the company its workforce to 952 employees from 1,054 at the end of 2011, following the reorganization led by Chief Executive Officer Claudio Yamaguti, the company said in the statement.
“We expect the company to maintain its expenses at lower level,” Francisco Kops and Rafael Ferraz, analysts at Banco J. Safra in Sao Paulo, wrote in a note to clients on April 17. They expected the bank to report net income of 367.8 million reais.
The combined value of credit-and debit-card transactions increased 12 percent to 57.7 billion reais, and total cost of services fell 0.6 percent to 246.4 million reais.
Itau, which owns 50 percent of Redecard, offered to pay 35 reais a share, or 11.8 billion reais, to purchase the rest of the card-payment processor Feb. 7. The Sao Paulo-based lender expects to hold an auction to buy out the lender between July and August, Chief Executive Officer Roberto Setubal said in a conference call April 16.
Redecard fell 0.4 percent to close at 32.43 reais in Sao Paulo today. The shares have gained 11 percent this year, compared with a 26 percent jump for its biggest rival Cielo SA.