Localiza Rent a Car (RENT3) Q3 2024 earnings summary

Executive summary

• Achieved solid results in 3Q 2024, driven by strong revenue growth in Car Rental, Fleet Rental, and Seminovos, operational improvements, and disciplined capital allocation.

• Focused on restoring ROIC spread through pricing adjustments, portfolio optimization, cost management, and fleet rejuvenation.

• Significant progress made in restoring ROIC spread after a challenging 2Q24.

• Recognized as a top employer and most innovative company in the sector.

Financial highlights

• Consolidated net revenue grew 32.3% year-over-year to R$9.7 billion in 3Q24.

• EBITDA advanced 24.1% to R$3.3 billion; net income reached R$812 million, up 22.2% year-over-year.

• Free cash flow before interest in 9M24 was R$3 billion, with cash position at R$11.8 billion, covering debt amortizations until 2026.

• Car Rental net revenue grew 19% to R$2.4 billion; Fleet Rental net revenue rose 24% to R$2.1 billion; Seminovos net revenue increased 44% to R$5.1 billion.

• Consolidated EBIT rose 24.6% to R$2.0 billion in 3Q24.

Outlook and guidance

• Expect gradual convergence of Seminovos margin to low single digits, with depreciation guidance unchanged.

• Anticipate continued positive trends in pricing and sales, with strong fourth quarter expected due to high demand and industry fleet adjustments.

• Fleet renewal and rejuvenation to be gradual, extending through 2025.

• Market expects new car sales in Brazil to exceed 2.4 million units in 2024.