M. Dias Branco (MDIA3) Q4 2024 earnings summary

Executive summary

• Net revenue in 2024 was R$9.7 billion, down 10.9% year-over-year, mainly due to a 1.8% drop in sales volume and a 9.8% decrease in average price per kg; Q4 net revenue was R$2.5 billion, up 4% sequentially.

• EBITDA for 2024 was R$1.2 billion (margin 12.4%), down 16.4% from 2023; Q4 EBITDA was R$355 million, up 55% sequentially, with margin at 14.3%.

• Net income for 2024 was R$646 million, down 27.3% year-over-year; Q4 net income was R$177 million, up 42% sequentially but down 48% year-over-year.

• Operational efficiency initiatives included commercial team unification, plant and distribution center closures, digital transformation (SAP S/4HANA), and new product launches such as non-fried instant noodles.

• Maintained leadership in cookies, crackers, and pasta, with market share gains in cookies and flour, and a slight decline in pasta.

Financial highlights

• Gross profit in 2024 was R$3.3 billion, with gross margin at 34.4% (+1.2 p.p. YoY); Q4 gross margin was 33.5% (up 3.3 p.p. sequentially), aided by extraordinary items.

• Cost of goods sold fell 12.6%, representing 70.1% of net revenue, supported by lower wheat prices.

• SG&A expenses as a percentage of net revenue decreased in Q4, reflecting cost control; Q4 SG&A was BRL 480 million (19.3% of net revenue).

• Operating cash generation was R$592 million in 2024; year-end cash position was R$2.1 billion with net debt of R$24.6 million.

• Capex for 2024 was R$304 million, down 17% from 2023, focused on maintenance and expansion.

Outlook and guidance

• Monthly dividend policy from April 2025: R$0.03 per share, maintaining an 80% payout of adjusted net profit.

• Focus on operational efficiency, cost optimization, innovation, and international expansion, especially in Uruguay.

• Continued investment in digital transformation, ESG, and new product launches, with targets for waste reduction, renewable energy, and diversity.