Ultrapar (UGPA3) Q2 2024 earnings summary

Executive summary

• Net revenues reached R$32.3 billion in 2Q24, up 9% year-over-year, driven by Ipiranga and Ultracargo, partially offset by Ultragaz.

• Recurring Adjusted EBITDA rose 37% year-over-year to R$1.28 billion, mainly from Ipiranga's improved margins and inventory gains.

• Net income doubled to R$491 million in 2Q24, reflecting higher EBITDA and lower net financial expenses.

• Operating cash flow was R$1.3 billion, up 44% year-over-year, supported by higher EBITDA and improved working capital.

• Interim dividends of R$276 million were approved for 1H24.

Financial highlights

• Recurring Adjusted EBITDA for 1H24 reached R$2.59 billion, up 32% year-over-year.

• Net income for 1H24 was R$947 million, an 85% increase over 1H23.

• Investments and acquisitions totaled R$1.8 billion in 1H24, including strategic moves in Hidrovias, Witzler, and service stations.

• Net debt at quarter-end was R$7.7 billion, with a net debt/Adjusted LTM EBITDA ratio of 1.2x, down from 2.1x a year ago.

• Earnings per share (basic) was R$0.40 in 2Q24.

Capital allocation and financing

• Net debt at the end of Q2 2024 was R$7.7 billion, down from March 2024, with leverage at 1.2x net debt/EBITDA.

• Net debt figures do not yet include R$222 million from the Extrafarma sale, received in August.

• Ultragaz issued R$700 million in debentures in July 2024 at a cost below the current average gross debt.

• Dividend distribution of R$276 million for 1H24.

• Net debt reduction supported by strong operating cash flow and asset sale proceeds.