Orizon Valorização de Resíduos (ORVR3) Q1 2025 earnings summary

Executive summary

• Achieved solid Q1 2025 results with net revenue of R$240.8 million, up 15% year-over-year and 5% sequentially, and EBITDA of R$109.9 million, up 5% year-over-year and 13% quarter-over-quarter, driven by efficiency gains and higher prices.

• Strengthened capital structure through a R$635 million follow-on equity offering at R$48.20 per share, with a two-year lock-up, introducing Circular Holding as a new anchor shareholder.

• Advanced biomethane and waste-to-energy projects, with key plants set for launch in 2025 and 2027, and secured a landmark 750,000 carbon credit sale to Google for 2027-2029.

• Recent acquisitions and partnerships expanded geographic reach and diversified operations, including Oeste Ambiental and Juazeiro Ecopark.

• Interim financial statements reviewed by independent auditors with no material modifications required under IFRS and Brazilian standards.

Financial highlights

• Net revenue rose 15% year-over-year to R$240.8 million, with growth across all segments; EBITDA reached R$109.9 million, up 5% year-over-year and 13% sequentially, and gross margin improved to 59.6%.

• Gross profit (ex-depreciation/landfill closure) increased 18% year-over-year to R$143.6 million.

• Net loss for the period was R$3.6 million, compared to net income of R$30.2 million in Q1 2024.

• CapEx for Q1 totaled R$112.1 million, with significant allocation to biomethane, energy recovery, and landfill projects.

• Share price ended the quarter at R$42.30, up 12%, with a market cap of R$3.5 billion.

Outlook and guidance

• Pipeline for landfill acquisitions targets 3 million tons, aiming for a 35% increase in managed volumes, with advanced-stage targets and ongoing focus on disciplined CapEx.

• Jaboatão biomethane plant to start in Q2 2025, Paulínia in Q1 2025, Barueri in Q1 2027; combined, these will double EBITDA.

• Regulatory trends and the National Plan for Circular Economy expected to drive midterm revenue and support demand for sustainable solutions.

• Expansion into new regions and increased capacity for waste processing and renewable energy are expected to drive future revenue.

• Continued evolution in monetizing biogas, biomethane, and carbon credits.