Irani Papel e Embalagem (RANI3) Q2 2025 earnings summary

Executive summary

• Net revenue reached BRL 413.8 million in 2Q25, up 11.6% year-over-year, driven by higher prices in packaging and paper segments despite lower volumes.

• Adjusted EBITDA increased 6.8% year-over-year to BRL 127.5 million, with a margin of 30.8%.

• Net income surged 168.5% to BRL 112.1 million, boosted by non-recurring IPI tax credits and higher fair value of biological assets.

• Net Debt/EBITDA ratio rose to 2.30x, reflecting higher net debt due to dividends and share buybacks, but remains within policy limits.

• Cash position at quarter-end was BRL 627.1 million, with 91% of gross debt long-term and 99% in local currency.

Financial highlights

• Gross profit was BRL 215.9 million, up 38.4% year-over-year, with gross margin at 52.2%.

• Operating profit before taxes and interest was BRL 132.4 million, up 110.7% year-over-year.

• Adjusted free cash flow was BRL 155.5 million, up 41.3% year-over-year, with a 16.3% yield.

• ROIC for the last twelve months was 11.8%, up from the previous quarter.

• Net margin improved to 27.1% from 11.3% a year ago.

Outlook and guidance

• Management expects continued resilience in margins despite OCC cost pressures, supported by pricing strategies and operational discipline.

• Returns from Gaia Platform investments are expected to gradually strengthen operating cash flow.

• Actual results may differ from expectations due to factors beyond management's control.