Ultrapar (UGPA3) Q3 2025 earnings summary

Executive summary

• Strong operational cash generation across all business units in Q3 2025, totaling R$2.1 billion, with record results at Hidrovias and support for growth and strategic initiatives.

• Rapid deleveraging, with leverage reduced to 1.7x, even after significant dividend payments.

• Completion of key strategic transactions, including the sale of Hidrovias' cabotage operation, acquisition of a 37.5% stake in Virtu Participações (LNG logistics), and expansion of Ultracargo's Santos terminal.

• Extraordinary tax credits of R$238 million at Ipiranga contributed to results.

• Continued focus on fighting illegal practices in the fuel sector, with positive impacts from regulatory enforcement and the Carbono Oculto Operation.

Financial highlights

• Adjusted EBITDA reached R$1.95 billion, up 27% year-over-year, including R$185 million in extraordinary tax credits at Ipiranga.

• Recurring adjusted EBITDA was R$1.78 billion, an 18% increase year-over-year, driven by Hidrovias' record performance.

• Net income for the quarter was R$772 million, up 11% year-over-year, supported by higher operating results and tax credits.

• CapEx totaled R$780 million, reflecting investments in Ipiranga, Hidrovias, and Epranga.

• Operating cash generation was R$2.1 billion, nearly triple the prior year period.

Outlook and guidance

• Expectation of continued market recovery in Q4, with volume growth and profitability similar to Q3 for Ipiranga.

• UltraGas anticipates gradual volume recovery and higher EBITDA in Q4, despite seasonally weaker demand.

• UltraCargo expects demand and EBITDA recovery in Q4, benefiting from recent capacity expansions.

• Hidrovias' Q4 EBITDA expected to be similar to Q4 2022, with seasonality affecting navigability.

• Strategic focus on growth, operational efficiency, and portfolio optimization, including further investments and enforcement in the fuel sector.