Alpargatas (ALPA4) Q1 2025 earnings summary

Executive summary

• Net revenue rose 17.2% year-over-year to R$1.09B, with gross profit up 31.8% and net income reaching R$112.4M, a significant increase from R$24.7M in Q1 2024.

• Havaianas Brazil led growth with 14% volume and 22% revenue increase; international operations saw mixed results, with Europe showing early recovery and improved U.S. profitability.

• Adjusted EBITDA increased 87.3% to R$206M, with margin expanding 7.1 p.p. to 18.9%, and operational improvements drove margin recovery and cash generation.

• Rothy's contributed positively, with net revenue up 20% to USD 43M, EBITDA positive at USD 0.8M, and resilience to U.S.-China tariff risks.

• Interim financial statements were reviewed and found compliant with CPC 21 and IAS 34, with no material modifications required.

Financial highlights

• Consolidated volume grew 10% year-over-year, mainly driven by Brazil's 14% sell-in and 22% revenue growth.

• Gross profit grew 31.8% to R$560.5M, with gross margin up 5.7 p.p. to 51.3%.

• Adjusted EBITDA surged 87.3% year-over-year to R$206M; EBITDA margin reached 18.9%, the best first-quarter level in five years.

• Cash generation LTM reached R$439M; net leverage improved to -0.6x Net Debt/EBITDA.

• Capex for Q1 was R$27M, up from R$15M in Q1 2024.

Outlook and guidance

• Management expects sell-in and sell-out volumes to realign over the year, with inventory management to avoid stockouts and write-offs.

• Focus on expanding margins, disciplined SG&A management, and continued brand building in Brazil and internationally.

• No explicit margin or volume guidance provided, but management targets sustainable efficiency and profitability improvements.