Marcopolo (POMO4) Investor Day 2024 summary

Strategic direction and business outlook

• Achieved highest Brazilian bus market volume in a decade, with over 10% annual growth in 2024 and volumes returning to 2019 levels.

• Emphasis on sustainable growth through fleet renewal, decarbonization, electrification, and new product launches, supported by R&D and automation investments.

• International operations are profitable, contributing 28% of net revenue in 9M24, with strong positions in Latin America, Africa, and expansion into new markets.

• Diversification into rail, motorhomes, and a multi-solution decarbonization approach (electric, hybrid, ethanol, biomethane, hydrogen).

• Strengthened client relationships and market presence through direct marketing, expanded sales and after-sales networks, and high-profile events like LAT.BUS.

Financial performance and guidance

• Net revenue in 2024 is close to 2023 levels despite lower volumes, with 144% growth since 2015, driven by improved pricing, product mix, and efficiency.

• Gross profit margins stabilized between 21% and 26%, reaching 24.9% in 3Q24, with expectations for continued stability due to value-added products.

• EBITDA margin at 20.1% in 3Q24, supported by disciplined capital allocation and ongoing investments in automation and product development.

• ROE increased to 33.2% and ROIC to 25.2% in 3Q24, reflecting a profitability-driven mindset.

• CapEx for 2024 is $350 million, with potential increases in 2025 to support product and process innovation.

Market trends and growth opportunities

• Brazilian bus market in 2024 is expected to reach its highest volume in a decade, with growth across all segments and strong demand for urban and charter buses.

• Government programs like Caminho da Escola and PAC for Urban Mobility are driving demand, with Marcopolo supplying 52% of 14,820 buses in phase 12 (2024-25).

• Internationally, fleet renewals are anticipated in Colombia, Argentina, Australia, and Africa, with Argentina as a key short-term growth driver.

• Electric and alternative propulsion vehicles are gaining traction, with local content and partnerships (e.g., WEG for batteries) supporting competitiveness.

• Post-pandemic, there is a shift from air to bus travel for tourism, and a significant need for fleet renewal due to aging vehicles.