Raízen (RAIZ4) Q1 24/25 earnings summary

Executive summary

• Net revenue reached BRL 57.8 billion in Q1 FY2025, up 18–18.3% year-over-year, driven by strong mobility recovery, record sugarcane crushing, and improved pricing across segments.

• Net income rose 59% to BRL 1.07–1.1 billion, supported by operational excellence, tax credits, and positive hedge accounting.

• Strategic focus on expanding Shell integrated offerings, lubricants, logistics, and investments in E2G and renewables.

• Argentina operations contributed to reduced debt and lower interest expenses, with Latam Mobility showing strong profitability and cash generation.

• Continued commitment to disciplined capital allocation, deleveraging, and maintaining investment grade.

Financial highlights

• Adjusted EBITDA was BRL 2.3–3.3 billion, down 29% year-over-year; net income up 59% to BRL 1.07–1.1 billion.

• Gross profit was BRL 2.6–2.65 billion, down 5.7% year-over-year, due to higher cost of goods sold.

• Leverage ratio increased to 2.3x net debt/adjusted EBITDA, with net debt at BRL 31.6 billion and average debt maturity over 6 years.

• Monetized over BRL 1.2 billion in tax credits this quarter, with total recognition of BRL 1.8 billion from ICMS exclusion.

• CAPEX was BRL 2.2 billion, flat year-over-year, with a focus on renewables and agricultural productivity.

Outlook and guidance

• Guidance for sugarcane crushing between 82–85 million tons, with favorable cost dynamics and expanding exports.

• Adjusted EBITDA guidance of BRL 14.5–15.5 billion (+14% YoY); CAPEX guidance of BRL 10.5–11.5 billion (-13% YoY).

• Inventory build-up in sugar and ethanol expected to support future sales at better prices; leverage expected to fall below 1.8x by year-end.

• E2G program targets 4 operational plants and over 80 million liters of cellulosic ethanol production.

• Continued focus on capital discipline, operational excellence, and value generation from recent investments.