Companhia Melhoramentos de São Paulo (MSPA3) Q1 2024 earnings summary

Executive summary

• Q1 2024 adjusted net revenue was R$42.8m, down 15% YoY; net loss narrowed to R$7.0m from R$8.2m.

• Results reflected weak paperboard and book markets, while forestry volumes improved QoQ and editorial restructuring targeted simpler operations.

Financial highlights

• Net revenue was R$40.2m, up 7% QoQ and down 19% YoY; adjusted net revenue was R$42.8m, down 23% QoQ and 15% YoY.

• Gross profit was R$15.3m, down 17% YoY in absolute terms; gross profit relative to revenue improved 2.5%.

• Operating result before finance and taxes was a loss of R$2.5m, versus income of R$0.4m in Q1 2023; net financial expense was R$5.6m.

• Net loss was R$7.0m versus R$8.2m a year earlier; basic EPS was -R$1.08750 versus -R$1.27931.

• EBITDA was R$9.2m, up 66% YoY; adjusted EBITDA, excluding non-cash accounting movements, was R$0.2m versus R$5.6m.

Outlook and guidance

• Forestry priorities include operational efficiency and customer diversification to mitigate lower sales volumes and market pressure.

• Editorial restructuring is focused on simplifying products and processes, adjusting portfolio and inventory, and creating a more agile platform for new products.

• Altea is advancing logistics, industrial, residential, tourism and environmental-services projects; the Monte Verde tourism plan includes infrastructure and sustainable tourism development.