Jalles Machado (JALL3) Q4 2024 earnings summary

Executive summary

• Achieved record consolidated gross revenue of R$2.2 billion in 2023/24, up 14.6% year-over-year, surpassing R$2 billion for the first time.

• Net income for the year was R$85.1 million, a sharp decline from R$692.3 million in the prior year, reflecting non-recurring items and lower ethanol prices.

• Adjusted EBITDA reached R$1,207.3 million, down 24.9% year-over-year, while 4Q24 Adjusted EBITDA rose 79.5% to R$297.5 million.

• Operations include sugar, ethanol, electricity, and by-products, with three manufacturing facilities processing over 8.5 million tonnes of sugarcane per crop.

• Significant investments in technology, plant expansion, and ESG initiatives, including the start of operations at the USV sugar plant.

Financial highlights

• Gross revenue in 4Q24 was R$586.6 million, up 98.0% from 4Q23; net revenue was R$502.7 million, up 86.5%.

• Adjusted EBIT for the year was R$180.9 million, down 73.0% year-over-year, with margin at 9.5%.

• Net debt increased to R$1,567.3 million, with a net debt/EBITDA ratio of 1.3x and average debt maturity of 5.0 years.

• Cash and equivalents stood at R$1,069.4 million, covering 4.4x short-term debt.

• Basic and diluted earnings per share: R$0.2862 (2024) vs. R$2.3540 (2023).

Outlook and guidance

• Sugarcane processing for 2024/25 is projected to grow 12% to 8.23 million tons, reaching 91.4% of capacity.

• Sugar mix will increase to 50.6% of TRS, up from 37.5%, reducing ethanol exposure.

• Capex for 2024/25 is expected to decrease 7.7% to R$797.5 million as major expansion projects conclude.

• Guidance targets full crushing capacity of 9 million tons by 2026/27.

• Management expects improved profitability and consumption of accumulated tax losses from ongoing investments.