Localiza Rent a Car (RENT3) Q2 2025 earnings summary

Executive summary

• Achieved solid results in 2Q25, focusing on restoring ROIC spread, operational efficiency, and executing strategic priorities across cycles, amid a challenging macroeconomic environment.

• Price increases and cost management in Car and Fleet Rental divisions drove revenue and margin expansion.

• Integration of Locamerica and system upgrades enabled cost efficiencies, corporate simplification, and operational synergies.

• Digital initiatives improved customer experience, with record digital pick-ups in Car Rental.

• Maintained leadership in Latin America's car rental market, with a fleet of 633,000 vehicles at the end of 2Q25, and strong ESG performance.

Financial highlights

• Consolidated net revenue reached R$9.9 billion in 2Q25, up 9.4% year-over-year.

• EBITDA totaled R$3.3 billion, a 40.1% increase year-over-year, with margin expansion in rental divisions.

• Adjusted net income was R$768 million, with an accounting loss of R$169 million due to a non-cash write-off of Locamerica tax credits.

• Annualized ROIC reached 13.7%, with a 4.1 p.p. spread over after-tax cost of debt.

• Net debt ended at R$31.3 billion, with net debt/EBITDA LTM at 2.36x and net debt/fleet value at 0.59x.

Outlook and guidance

• Expect to capture R$2.3 billion in cash tax benefits over five years from goodwill amortization, offsetting the tax credit write-off.

• Anticipate a one-off pre-tax impact of R$800 million to R$1 billion in 3Q25 due to IPI tax reduction affecting pre-owned car prices.

• Strategic focus remains on price recomposition, cost efficiency, portfolio optimization, and disciplined capital allocation, with ongoing margin expansion expected.