PBG (PTBL3) Q2 2025 earnings summary

Executive summary

• Net revenue grew 16.6% year-over-year in 2Q25, reaching R$686.8 million, with robust performance across all business units and significant market share gains despite global and Brazilian construction materials market challenges.

• International markets, especially Portobello America, drove growth with revenue up 52.4% in BRL (34.9% in USD), operational stability, and local production scale.

• All business units delivered positive results, with advances in exports, retail, and operational efficiency.

• Free cash flow improved to R$63.4 million, ending cash balance at R$396 million, supported by efficient working capital management and liquidity-preserving financial instruments.

• Completed R$300 million debenture issuance, reducing pro forma leverage to 2.3x and strengthening capital structure.

Financial highlights

• Net revenue increased 16.6% year-over-year in 2Q25, with international markets expanding their share to 28.1%.

• Gross profit grew 17.4% to R$252.4 million, with a margin of 36.7%.

• Pro forma EBITDA rose 45% to R$101 million, with margin up 2.9 p.p. to 14.7%, reflecting operational efficiency and excluding one-off events.

• Free cash flow generation totaled R$63.4 million, up R$57.4 million from 2Q24.

• Financial expenses rose 51.5% to R$92.6 million, mainly due to high interest rates and increased use of structured financing.

Outlook and guidance

• Focus remains on cash generation, operational efficiency, and deleveraging for the second half of 2025.

• U.S. import tariffs on Brazilian products effective August 2025 are expected to have limited impact due to local manufacturing, positioning the company for competitive advantage in North America.

• Management reaffirms commitment to innovation, sustainable growth, and global competitiveness.

• Ongoing deleveraging strategy, targeting leverage at or below 2.3x, with further reductions anticipated as interest rates normalize.

• No formal guidance provided, but U.S. operations expected to contribute higher EBITDA margins than Brazil.