Grendene (GRND3) Q1 2026 earnings summary

Executive summary

• Faced a selective domestic consumption environment and challenging international market due to geopolitical conflicts, logistics disruptions, and exchange rate fluctuations.

• Consolidated volume grew 1.6% to 25.7 million pairs despite a shift toward affordable categories and adjustments in product mix and channels.

• Maintained strong operating cash flow, robust capital structure, and continued shareholder remuneration.

• Expense control and operational discipline supported resilience amid margin pressure.

• Net revenue for 1Q26 was R$533.8 million, down 5.3% year-over-year, with gross margin at 43.1%, a decrease of 3.6 pp.

Financial highlights

• Gross revenue was R$683.0 million, down 3.2% year-over-year; gross profit fell 12.7% to R$230.1 million.

• Adjusted EBIT was R$59.1 million, down 23.6% year-over-year; adjusted net profit dropped 38.8% to R$122.1 million.

• Net financial result decreased 17% to R$73.1 million, mainly due to lower profits from financial applications after large dividend payouts.

• EBITDA was R$66.2 million, down 10%; adjusted EBITDA was R$83.7 million, down 31.6%.

• Capex for the quarter was R$17.3 million, focused on modernization and efficiency.

Outlook and guidance

• Strategy remains responsive to market demand, prioritizing affordable products and higher-turnover channels while maintaining higher-value offerings.

• Product mix and channel adjustments are ongoing to address selective consumer behavior.

• Management continues to monitor geopolitical risks and market volatility, maintaining prudent capital allocation and adaptability.

• Dividend policy will remain unchanged despite new tax regulations.