Ultrapar (UGPA3) Q2 2025 earnings summary

Executive summary

• Achieved strong operating cash flow of R$1.8 billion, with R$0.9 billion used to reduce draft discount, reflecting disciplined working capital management.

• Consolidated Hidrovias do Brasil since May, contributing to record results and future growth potential; Ultrapar became controlling shareholder after capital increase.

• Recognized R$677 million in extraordinary ICMS tax credits at Ipiranga, boosting net income.

• Completed major projects at Ultracargo, including Opla/Paulínia railway branch and Pomerode/Palmeirante terminal ramp-up, expanding agribusiness exposure.

• Concluded buyback of 25 million shares at R$16.64 average and raised R$1 billion at Ipiranga at a cost below average debt.

Financial highlights

• Net revenue reached R$34.1 billion, up 5% year-over-year, driven by Ipiranga and Ultragaz.

• Total EBITDA rose 55% year-over-year to R$2.07 billion, driven by extraordinary tax credits and Hidrovias consolidation.

• Recurring adjusted EBITDA was R$1.5 billion, a 15% increase from Q2 2024.

• Net income totaled R$1.2 billion, up 134% year-over-year, reflecting higher operating results and tax credits.

• CapEx for the quarter was R$544 million, up 14% year-over-year, mainly due to Hidrovias investments.

Outlook and guidance

• Expect seasonally stronger volumes and higher recurring EBITDA in Q3 for Ipiranga, Ultragaz, and Hidrovias do Brasil.

• Anticipate leverage to return to 2024 levels by year-end, with strong cash flow in H2 2025.

• Ultracargo EBITDA expected to remain in line with Q2 in the next quarter.

• Continued focus on operational efficiency, capital cost optimization, and infrastructure investments.

• Advances in combating irregularities in the fuel sector, including new tax measures and regulatory actions.