SIMPAR (SIMH3) Q4 2024 earnings summary

Executive summary

• Achieved record consolidated gross revenue of BRL 45.2 billion in 2024, up 27% year-over-year, with net revenue from services at BRL 32.6 billion, and consolidated net revenue at BRL 41.1 billion, up 29% year-over-year.

• EBITDA reached BRL 10.5 billion in 2024, up 28% year-over-year, with margin expansion to 46.5% (excluding dealerships and asset sales).

• Adjusted consolidated net income was BRL 548 million in 2024, reversing the previous year's loss and improving by BRL 828 million versus 2023.

• Completed major corporate reorganizations, including the spin-off of Vamos and Automob, with Automob listed as Brazil's largest dealership group and Vamos focused on rentals.

• Entered a new operational cycle focused on extracting value from built foundations, emphasizing operational efficiency and lower CapEx needs.

Financial highlights

• Q1 2024 net revenue was BRL 10.7 billion, up 24% sequentially; full-year net revenue reached BRL 41.1 billion, up 29% year-over-year.

• EBITDA for 2024 was BRL 10.5 billion (+28% YoY); adjusted net income was BRL 548 million (+38% YoY).

• Record asset sales revenue of BRL 7.8 billion in 2024 (+28% YoY); asset base exceeded BRL 42 billion.

• Consolidated net debt stood at BRL 40.7 billion, with cash and liquidity of BRL 15.6 billion, about 3x short-term debt, and average debt maturity of 4.3 years.

• SG&A expenses over net revenue reduced from 10.2% in 2023 to 8.6% in 2024.

Outlook and guidance

• Management expects higher cash generation and lower investment needs in 2025, benefiting from anticipated CapEx and operational efficiencies.

• Focus remains on deleveraging, targeting a net debt/EBITDA ratio below 3x in the medium term.

• All companies are expected to deleverage while continuing to grow with less CapEx and improved operational efficiency.

• CS Infra targets EBITDA of BRL 180–250 million by 2026, with major projects on schedule and no adverse effect on deleveraging.

• 2025 strategy emphasizes value extraction from existing assets, price adjustments, asset turnover, and cost reductions.