Alpargatas (ALPA4) Q3 2025 earnings summary

Executive summary

• Achieved 7.5% year-over-year net sales growth in 3Q25, with strong international and domestic performance and record quarterly consolidated Adjusted EBITDA of R$256 million.

• Net income reached R$171 million in the quarter, up 199% year-over-year, with adjusted net income of R$174 million (+131%).

• Significant efficiency gains and cost reductions, including a 17% decrease in fixed expenses compared to 2022.

• Havaianas was recognized as the most desired fashion brand globally, with Lyst naming it the most desired fashion item.

• Interim financial statements for the nine months ended September 30, 2025, were reviewed and found to fairly reflect the company's financial condition and operating activities, with an unqualified auditor's report and audit committee approval.

Financial highlights

• Consolidated net sales reached R$1.12 billion in 3Q25, up 7.5% year-over-year, with gross profit up 18.4% to R$586 million and gross margin improving to 52.5%.

• Adjusted EBITDA margin rose to 22.9% from 13.2% in 3Q24, and net profit increased to R$171 million from R$57 million in 3Q24.

• Net income attributable to controlling shareholders was R$371.6 million for the nine months, compared to R$105.8 million in the prior year period.

• Ten consecutive quarters of positive operating cash generation, totaling R$1.3 billion.

• Net cash position improved to R$399 million at quarter-end, with net debt/Adjusted EBITDA at -0.6x.

Outlook and guidance

• Focus on expanding specialized channels in Brazil, business model change in the U.S. with Eastman Group partnership, and disciplined pricing management across all geographies.

• Management remains focused on sustainable growth, financial discipline, and scaling operations in Brazil and internationally, with an investment plan for 2025 totaling R$220 million.

• The company continues to monitor the impacts of Brazil's tax reform and OECD Pillar Two rules, with no current effect on 2025 financials.