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Stock Market & Financial Investment News

News Breaks
December 14, 2012
16:54 EDTMELIGalperin Trust reports 8.6% passive stake in MercadoLibre
News For MELI From The Last 14 Days
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April 7, 2015
06:06 EDTMELIMercadoLibre sees Q1 charge of $15M-$18M for foreign exchange
MercadoLibre disclosed last night that on February 10, the Venezuelan government issued a decree that unifies the two previous foreign exchange systems that are frequently referred to as SICAD 1 and SICAD 2 into a new single system denominated SICAD, with an initial public foreign exchange price of 12 Bolivares Fuertes per U.S. dollar. It added, "In light of the disappearance of SICAD 2, and the Company’s inability to gain access to U.S. dollars through the new single system under SICAD, the Company started requesting and has been granted U.S. dollars through SIMADI. As a result, the Company now expects to settle its transactions through SIMADI and has concluded that the SIMADI exchange rate should be used to re-measure its bolivar-denominated." Considering this change in facts and circumstances and the lower U.S. dollar-equivalent cash flows now expected from its Venezuelan business, MercadoLibre is reviewing its long-lived assets, goodwill and intangible assets with indefinite useful life for impairment, and estimates that the carrying value of certain real estate investments in Venezuela as of March 31 will not be fully recoverable. As a result, the company has estimated a one-time charge of approximately $15M-$18M to be recorded in Q1. MercadoLibre also expects to recognize a foreign exchange loss of between $18M-$23M and a deferred income tax gain of between $1.5M-$4.5M derived from the loss on foreign exchange related to the revaluation of its U.S. dollar-denominated liabilities during Q1.

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