Brookfield Incorporacoes SA plunged to a four-year low as the homebuilder posted a surprise quarterly loss after it spent more than planned on projects and burned through about half the cash raised in a capital increase.
The shares sank 7.1 percent to 1.95 reais today in Sao Paulo, the lowest since April 2009. The Ibovespa equity benchmark retreated 0.6 percent.
Brookfield’s adjusted net loss was 47.7 million reais ($23.8 million) in the three months through March, according to data compiled by Bloomberg after the company released its earnings report late yesterday. The average estimate of six analysts was for a profit of 27.5 million reais.
The results were “disappointing” and hampered by “problems in the construction of some projects, which caused an extra cost of 10.4 million reais,” the homebuilder said in a regulatory filing. The company also burned through 217 million reais of cash, about half of a capital increase it concluded in the fourth quarter, analysts at Banco Bradesco SA’s brokerage unit wrote in a note to clients today.
“We expect this fact to fuel rumors that the company could pursue another capital increase,” the analysts including Luiz Mauricio Garcia wrote.
Brookfield has slumped 43 percent this year, the worst performance on the BM&FBovespa Real Estate Index, which slid 11 percent.