Cencosud Gains in Chile on Lower-Than-Expected Provisions
Cencosud SA (CENCOSUD) rose the most in nine weeks after the Chilean retailer set aside less money to compensate customers for illegal credit card commissions than some investors had expected.
The shares gained 1.9 percent to 2,670 pesos at 11:12 a.m. in Santiago, the biggest rise on a closing basis since March 4. The country’s benchmark Ipsa index increased 0.3 percent.
Cencosud, Chile’s largest retailer by sales, said in a regulatory filing that it set aside about 20 billion pesos ($42.4 million) after the country’s Supreme Court ordered it to return some credit card commissions found to be collected illegally. The consumer rights agency Sernac, which filed a class-action against Cencosud in 2006, said in a statement after the April 24 ruling that the company would have to pay back about $70 million.
Sernac’s estimate “took into account all of the holders of Cencosud’s credit cards,” Josefina Guell, an analyst at Corp Research SA, said in a telephone interview today. “As the commission wasn’t charged on all clients, and there’s always a percentage of inactive cards, the figure was lower and the stock is rising.”
Cencosud said in a filing yesterday that the Supreme Court could revise the 20 billion-peso figure.
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