Irani Papel e Embalagem (RANI3) Q1 2026 earnings summary

Executive summary

• Q1 2026 was impacted by scheduled shutdowns for the Gaia XI Project and technical issues with turbo generator 4, affecting production, sales volumes, and EBITDA, but reinforcing the medium- and long-term value generation strategy.

• The company maintained commercial discipline and focus on profitability, with a 3.8% drop in packaging sales volume, prioritizing value over volume and stable average prices.

• Additional dividends for 2025 and interim dividends for 1Q26 were approved, reflecting strong capital discipline.

• The company is a leading Brazilian packaging provider with over 80 years of experience, focusing on sustainable practices and integrated operations, with 91% of corrugated packaging sales in Brazil.

• Strategic investments in technology, operational efficiency, and ESG initiatives underpin growth and resilience.

Financial highlights

• Net revenue in 1Q26 was BRL 409.8 million, down 3.1% year-over-year and 1.5% sequentially; adjusted EBITDA was BRL 113.5 million, down 17.1% year-over-year, with a margin of 27.7%.

• Net income for the period was BRL 19.4 million, a 68.1% decrease year-over-year.

• Free cash flow yield reached 19.8% in the last twelve months, up 6.8 p.p. year-over-year.

• Dividend yield was 8.1% in 1Q26, with BRL 134.6 million distributed over the last 12 months.

• Net debt/EBITDA improved to 2.11x from 2.21x a year ago.

Outlook and guidance

• Gradual capture of returns from the Gaia XI Project is expected as PM #5 ramps up.

• Project Gaia XI secured BRL 82.5 million in BNDES financing with up to 20 years maturity, supporting modernization and efficiency investments.

• No significant demand or raw material access impacts from geopolitical events, though logistics costs increased.

• Management remains confident in the sustainable packaging thesis and ongoing value creation.

• Ongoing investments in the Gaia Platform, with BRL 271 million allocated to projects in progress as of 1Q26.