Brazilian iron ore producer MMX Mineracao e Metalicos SA swung to a loss in the third quarter due to higher debt servicing costs.

MMX in a statement said that its net loss for the three months ended September 30 was BRL 243.2 million (USD 138.8 million), as compared with a profit of BRL 88.5 million a year earlier. Gross revenue increased 14% to BRL 287.9 million.

The company attributed the result to a rise in its debt servicing costs, which soared after the depreciation of the Brazilian real versus the US dollar. A large share of the company's debts are denominated in US dollars, which affects the bottom line when the US currency appreciates versus the real.

MMX said that "In the third quarter, MMX recorded a net loss of BRL 243.2 million, due to exchange rate losses of BRL 318.1 million. In the second quarter and in the year-ago period, these figures were positive, at BRL 90.9 million and BRL 88.5 million, respectively.”

MMX posted earnings before interest, taxes, depreciation and amortization of BRL 50.2 million for the third quarter, compared with BRL 72.8 million a year earlier.