SAO PAULO, June 6 (Reuters) - Brazil's biggest sugar andethanol producer, Cosan SA Industria e Comercio posted quarterly earnings of 29.7 million reais ($13.89 million)late on Wednesday, down sharply from almost 150 million reais ayear earlier due largely to a drop in earnings from ethanolsales.
The result was also below the average 99 million reais thata Reuters poll of analysts had predicted the company would earn.Costs related to last year's purchase of local natural gassupplier Comgas also impacted its bottom line, it said in asecurities filing.
EBITDA or earnings before interest, tax, depreciation andamortization in the quarter through March 31, the fourth quarterof its fiscal year, more than doubled from a year earlier to915.5 million reais.
The company ended the fiscal year with net debt of 8.5billion reais, up from 3.1 billion a year earlier, Cosan said.
The fiscal year for Brazilian sugar cane companies runs fromApril 1 with the beginning of cane harvesting and crushing.
Cosan is a partner with oil major Royal Dutch Shell in a fuel distribution venture called Raizen and it has alogistics arm, Rumo. Cosan said comparatively high ethanolprices versus gasoline caused motorists to consume more of thefossil fuel, hitting earnings from biofuel sales.
Brazil is a biofuel pioneer with millions of flex-fuel carson its roads able to run on pure ethanol or gasoline or a mix ofboth. Drivers tend to switch between fuels depending on pricefluctuations.
Brazil's sugar and ethanol industry has suffered weakresults since a 2008 U.S. banking crisis and world recessionchoked off credit and demand and pushed many heavily indebtedmills to the brink of bankruptcy.
Prospects for the sugar and cane ethanol sector havebrightened recently with an expected record size sugar cane cropnow being harvested and after the government cut taxes on thebiofuel and raised its mandatory blend in gasoline to 25percent.
