Ambipar Participacoes e Empreendimentos (AMBP3) Q2 2024 earnings summary

Executive summary

• Achieved record net revenue of R$1,414.3 million in 2Q24, up 17.5% year-over-year, with gross revenue of R$1,573.9 million and strong performance in both Response and Environment divisions.

• Record EBITDA of R$436.4 million, up 18.0% year-over-year, with margin expansion to 30.9%, the highest in company history.

• Recurring net profit reached R$45.5 million, a 90.4% increase year-over-year, despite a reported net loss due to non-recurring debt prepayment costs.

• Deleveraging reduced net debt/EBITDA to 2.82x from 3.10x, with the lowest CAPEX intensity in company history at 9.3% of net revenue.

• Operational focus on efficiency, cash generation, and value creation, with ongoing restructuring and cost optimization initiatives.

Financial highlights

• Net revenue for 6M24 was R$2,681.1 million, up 14.4% year-over-year; EBITDA for 6M24 was R$810.9 million, up 22.6% year-over-year.

• EBITDA margin reached 30.9% in 2Q24, up 0.2pp year-over-year and 1.3pp sequentially.

• Operational ROIC reached 26.7% in 2Q24, up 2.8pp sequentially.

• Cash and equivalents stood at R$3.9 billion, providing a strong liquidity buffer.

• Working capital management improved, with average collection period reduced from 88 to 70 days year-over-year.

Outlook and guidance

• On track to meet 2024 guidance of at least 10% annual net revenue growth, with 14.4% growth in the first half.

• Continued focus on deleveraging, operational efficiency, and cash generation.

• Ongoing restructuring and tax optimization expected to further enhance cash flow.

• Management reiterates commitment to 2.5x net debt/EBITDA leverage target.

• Asset-light strategy underway, with asset sales and leasing contracts in final negotiation stages.