Brazilian retailer Companhia Brasileira de Distribuicao (CBD) has reported a lower quarterly net profit, due to higher costs related to its Sendas joint venture.

The company reported first-quarter net profit of BRL27.9m (US$9.5m), compared to BRL40.6m in the same quarter of last year, reported Reuters. Sales rose 6.8% to BRL2.81bn.

CBD, which is commonly known by the name of its flagship supermarket chain Pao de Acucar, reported an 11% rise in first-quarter operational costs, while net financial costs rose 28.5%.

The company said its Rio de Janeiro joint venture Sendas had engaged in an aggressive pricing strategy aimed at increasing market share that had hit profit margins, Reuters reported.

CBD said it invested BRL127m in the January to March quarter in its stores, more than in the year-earlier quarter.