Interest and inflation on downfall may pull demand from Duratex in the 2nd semester

Sao Paulo-the manufacturer of wooden panels, sanitary vitreous Chinaware and metal fittings Duratex expects a recovery of aggregate demand in the second half. For the company, the fall in interest rates and inflation rates should stimulate consumption, as in the mobile segment.
"Maybe we will see the rise of credit available in the market, improving the operations of the furniture industry. Allied to this, the lower inflation should leverage the purchasing power of people, "said the INN the investor relations manager of Duratex, William Setubal. According to him, there was a prospect of recovery of demand in the second quarter of this year, but that was postponed by the new chapter in the political crisis, triggered by the disclosure of the recording of a conversation between President Michel Temer and businessman Joesley Batista. "This episode has slowed the ongoing recovery," commented.
Even in the face of better prospects, the Executive estimates that the period between July and December is not going to be magnificent, but predicts that will generate positive results for Duratex.
Wood
According to Setubal, wooden panels should have a more consistent recovery in the second half, buoyed by the possible recovery of aggregate demand in the mobile segment. Between January and June, the Wood Division''s net revenue of the company retreated 8.1%, to $1.172 billion, while the R volume issued fell 8.4 percent to 1,112,558 cubic meters. The company informed that the second quarter was marked by the increase of prices, amid a more competitive landscape, which reflected in the fall in the volume sold. Setubal commented that the movement of July give indications that the use of the installed capacity in this area can be raised throughout the second half, leaving the range of 55%-in the first half-to 60%. In terms of price, the Executive provides for readjustment of about 6% in August only to white MDF line sold for retail.
Deca
Deca business segment, sales in the first half advanced 9.1%, adding R $696,251,000. Between the areas, the finished products-which include items such as shower heads, faucets and sinks (and generate higher margins)-pulled sales, with an increase of 9.5% in the total number of pieces shipped totaling 9,339,000. Among the basic products such as valves and records, sales advanced 7.1%, reaching 3,719,000 units.
In his opinion, when the sales of finished products grow above basic, there is an indication that the reforms and the completion of works are more heated. "We don''t see an improvement in demand for new buildings, since the initial construction cycle begins with basic items".
In terms of installed capacity, Setubal believes that the area of sanitary vitreous Chinaware and metal fittings can raise the level of 60%, registered in the first half, to something close to 65% in the second half of the year. About price adjustments in this segment, he ruled out new transfers this year, after the high of 6% applied, between March and April, in the entire line of products.
In a consolidated manner, Duratex recorded a net profit of RS $17,253,000 in the first half, reversing prejuízp R $28,833,000 of the same interval last year. The company reported that net income was received positively by an Industrialized Product tax credit (IPI) of R $22,300,000 and the early settlement of Sergipe Program of Industrial Development (R $3,400,000).
Investments totaled R $196,800,000 in the first half. For the year, the contributions should reach R $420 million, focused on priority operations support formation of forests and industrial maintenance.