Jalles Machado (JALL3) Q4 2026 earnings summary

Executive summary

• The year was marked by a 15% crop failure and a 10.1% decrease in sugarcane milling, with productivity (TCH) dropping 11.9%, especially in Minas Gerais and Goiás.

• Net revenue for 2025/26 was R$2,148.9 million, with net income of R$9.5 million, reversing the prior year's loss, though net income fell 24.5% year-over-year in another report.

• Adjusted EBITDA reached R$1,306.7 million, with margins around 61%, but fell 11.8% year-over-year due to lower sugar prices and productivity.

• Strategic focus shifted between sugar and ethanol production, with flexibility to adjust the mix as prices evolve.

• Investments in irrigation, crop management, and governance, plus cost reductions and a 350-person workforce reduction, supported resilience.

Financial highlights

• Adjusted EBIT was R$203.0 million, a 51.6% decrease; adjusted EBITDA margin was 60.8%.

• Net debt stood at R$1,720.6 million, with Net Debt/EBITDA at 1.3x; cash and equivalents rose 45.5% to R$1,806.9 million.

• Free cash flow was R$166.9 million, down 37.4% year-over-year.

• Hedge results contributed R$299.6 million, up 219% from the previous year.

• Cost of goods sold per TRS sold increased by 7.9% due to crop failure.

Outlook and guidance

• For 2026/27, sugarcane crushing is projected to rise 10.2% to 7.8 million tons, with productivity (TCH) up 8% to 80.4 t/ha.

• Ethanol production is forecast to grow by 18% to 372,000 m³, while sugar output is expected to decrease by 4.2%.

• Capex is forecast at R$610.3 million, down 12%, with increased investment in irrigation.

• Cost reductions of 5–10% are expected to be maintained, supported by lower input prices and efficiency gains.

• Sugar price recovery is anticipated as global deficits emerge, but timing remains uncertain.