March 8, 2018 / 9:21 PM / 10 months ago

Brazil's MRV eyes generous dividends as 2018 starts on a bright note

SAO PAULO, March 8 (Reuters) - Brazil's MRV Engenharia e Participações SA, one of Latin America's largest homebuilders, will pay a 155 million real ($47 million) extraordinary dividend in the second quarter and more may follow in 2018, its CEO told Reuters on Thursday.

In an interview following the release of fourth-quarter results, Rafael Menin said first-quarter metrics were shaping up to be better across the board than in 2017 as a real estate rebound in Latin America's biggest economy appears far from losing steam.

"Although the first quarter is seasonally weaker, consumers are more confident," Menin said. "All the metrics are positive."

MRV posted net income of 180 million reais ($55.2 million), up 27 percent from the same period last year and above a Reuters consensus estimate of 166 million reais, according to a securities filing on Thursday.

"Nothing is stopping other distributions during the course of the year," Menin, referring to the extraordinary dividend, told Reuters. "There's a possibility we'll go further and distribute more to shareholders."

MRV is among a crop of Brazilian homebuilders whose shares shot up in 2017 after surviving a years-long recession.

While some competitors such as PDG Realty SA and Viver Incorporadora e Construtora SA were forced to file for bankruptcy amid the harsh recession, MRV - which is lightly leveraged - snapped up significant chunks of land relatively cheaply amid weakened competition.

While Menin reiterated the company's previous plans to spend 500 million reais to boost land holdings in 2018, he said the company would begin to "reposition" in 2019 as opportunities for cheap land close.

The company posted solid margins in the fourth quarter, with earnings before interest, taxes, depreciation and amortization (EBITDA) coming in at 269 million reais, above the Reuters consensus estimate of 246 million reais.

Contracted sales, which were reported in January, jumped 34 percent from the same period last year.

$1 = 3.2602 reais Reporting by Gram Slattery and Gabriela Mello; Editing by Dan Grebler

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