Commodities Trader Engelhart Said to Post $225 Million Loss

  • Losses in agriculture and oil trading come amid job cuts
  • Engelhart is still expected to post annual profit, person said

Engelhart CTP SA, the commodities trading house spun off by Brazilian bank Grupo BTG Pactual, lost about $225 million in the third-quarter due to weak agriculture and energy trading.

The privately-held trading house is still expected to be profitable for the full year, according to a person with direct knowledge of the company’s accounts. Engelhart has cut staff by about 15 percent in response to difficult trading conditions in commodities markets, said the person, who asked not to be identified because the information hasn’t been made public.

It’s a setback for the company that has grown fivefold since it was started three years ago with about 150 employees and a focus on Brazil. Engelhart now has about 800 staff, 34 offices and a presence in 18 countries, according to its website.

The Financial Times reported the loss earlier on Tuesday. The newspaper also said Chief Operating Officer Nick Brewer is on leave from Engelhart and may soon depart after the loss, citing unidentified people close to the company.

Brewer did not immediately respond to a phone message or requests for comment sent to two e-mail addresses. Jennifer Renwick, an external spokeswoman for Engelhart, declined to comment.

BTG, which spun-off Engelhart this year in a deal valuing the commodity trading business at about $1.6 billion, said this month the unit was partially responsible for a 56 percent decline in the bank’s profit.

BTG’s third-quarter net income declined to 661 million reais ($209 million), from 1.51 billion reais, a year earlier, the Sao Paulo-based bank said on Nov. 9. Those figures include results from Engelhart and BSI, a Swiss private bank that the company recently sold.

If the units were excluded, net income would have been 920.9 million reais, BTG said.

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