SIMPAR (SIMH3) Q2 2024 earnings summary

Executive summary

• Achieved record gross revenue of R$11.3 billion in 2Q24, up 34% year-over-year, with net revenue of R$10.3 billion, up 36%.

• EBITDA reached R$2.7 billion (+17% y/y), with adjusted EBITDA at R$2.6 billion (+28.8% y/y); EBITDA margin (ex-dealerships/asset sales) rose 4.6 p.p. to 48.5%.

• Net income grew 59% year-over-year to R$159 million; adjusted net income was R$185 million.

• Diversified operations and long-term contracts drove consistent growth, value creation, and strong cash generation.

• Strong liquidity position of R$17.5 billion, with cash covering maturities through 2026.

Financial highlights

• Net revenue from services: R$8.0 billion (+33% y/y); consolidated net revenue: R$10.3 billion (+36% y/y).

• EBITDA: R$2.7 billion (+17.5% y/y, +11.4% q/q); adjusted EBITDA: R$2.6 billion (+28.8% y/y); EBITDA margin (ex-dealerships/asset sales): 48.5%.

• Net income: R$159 million (+59% y/y, +76.2% q/q); adjusted net income: R$185 million.

• Net capex: R$2.2 billion in 2Q24, focused on highly liquid assets for long-term contracts.

• Annualized ROIC (ex-BBC): 12.3%, 3.8 p.p. above cost of debt.

Outlook and guidance

• Companies are well positioned for continued growth, with no need for additional capital for listed subsidiaries.

• Focus on extracting value from existing assets, operational efficiency, and reducing leverage below 3x in the mid-term.

• Strategic plan for 2024 emphasizes efficiency, capital structure improvement, and value creation.

• Guidance for Automob, CS Portos, CS Grãos, Ciclus, and Banco BBC shows progress toward 2026 targets, with most segments at 35–71% of revenue/EBITDA goals.

• Movida targets 4.2% p.m. yield in RAC for 2024, with improved fleet mix and margin stability.