Grendene (GRND3) Q1 2026 earnings summary

Executive summary

• Net revenue for 1Q26 was R$533.8 million, down 5.3% year-over-year, with gross margin at 43.1% (down 3.6 pp), and adjusted EBIT at R$59.1 million (down 38.8%).

• Adjusted net profit reached R$122.1 million, a 23.6% decrease, while reported net profit was R$102.1 million, down 9.9%.

• Total volume sold increased 1.6% to 25.7 million pairs, but revenue per pair declined due to a higher share of lower-priced categories.

• The company maintained a strong financial position, high liquidity, and disciplined capital management, despite a 24% decrease in net cash to R$1.1 billion.

• Faced a selective domestic consumption environment and challenging international market due to geopolitical conflicts, logistics disruptions, and exchange rate fluctuations.

Financial highlights

• Gross revenue fell 3.2% to R$683 million, with domestic revenue down 1.5% and exports down 7.8%.

• Gross profit dropped 12.7% to R$230.1 million, with COGS rising 1.2% to R$303.8 million.

• Adjusted EBITDA was R$83.7 million, down 31.6%, and adjusted EBIT margin fell to 11.1%.

• Net financial income decreased 17% to R$73.1 million, mainly due to lower cash balance after dividend payments.

• Capex for the quarter was R$17.3 million, focused on modernization and efficiency.

Outlook and guidance

• The company remains focused on product mix, channel management, operational efficiency, and brand strengthening amid challenging consumer and international environments.

• Management continues to monitor macroeconomic and geopolitical risks, maintaining flexibility and prudent capital allocation.

• Dividend policy will remain unchanged despite new tax regulations.