Vulcabras (VULC3) Q1 2025 earnings summary

Executive summary

• Net revenue reached R$701.2 million in 1Q25, up 17.4% year-over-year, marking the 19th consecutive quarter of growth, with gross volume of 7.1 million pairs/pieces, a 5.6% increase.

• Net income rose 19.5% to R$106.1 million, with net margin improving by 0.2 p.p. to 15.1%.

• EBITDA grew 14.7% to R$140.4 million, with a 20.0% margin, slightly down due to higher commercial expenses from e-commerce growth.

• E-commerce net revenue surged 53.8% to R$118.4 million, now 16.9% of total revenue.

• Domestic market net revenue increased 19.3%, while foreign market revenue declined 13.1% due to challenges in Argentina.

Financial highlights

• Gross profit was R$281.9 million, up 17.5% year-over-year, with gross margin stable at 40.2%.

• Cost of goods sold remained at 59.8% of net sales, despite labor and input cost pressures.

• Net financial income improved to R$2.3 million, up from R$0.8 million in 1Q24, aided by FX gains.

• Advertising and marketing expenses increased 29.1% to R$35.5 million, representing 5.1% of net revenue.

• Adjusted ROIC (LTM) reached 29.2%.

Outlook and guidance

• Management expects continued growth, supported by innovation, portfolio expansion, and operational efficiency.

• Management projects a compound annual growth rate (CAGR) of 7.98% for revenue and 12.16% for net income from 2025–2029.

• Order book and new collections show strong market acceptance, reinforcing a positive outlook for 2025.

• No impairment indicators identified; value in use of assets remains significantly above book value.

• Results may be impacted by economic, market, and industry uncertainties.