Terra Santa Propriedades Agrícolas (LAND3) Q4 2024 earnings summary

Executive summary

• Net revenue reached R$68.3 million in 2024, a 25.5% decrease year-over-year, mainly due to lower soybean prices impacting lease revenues.

• Operational expenses rose 58.8% to R$43.1 million, driven by restructuring, increased personnel, and higher third-party service costs.

• Net income for 2024 was R$7.3 million, down from R$35.2 million in 2023, reflecting lower revenues and higher expenses.

• The company reported a challenging 4Q24 and full-year 2024, with significant declines in revenue, profitability, and margins year-over-year, mainly due to lower soybean prices and non-recurring operational expenses.

• The company maintained a strong governance structure and reinforced ESG commitments, including adherence to the UN Global Compact.

Financial highlights

• 4Q24 net revenue was R$16.3 million, down 15.6% from 4Q23; full-year 2024 net revenue was R$68.3 million, down 25.5% from 2023.

• 4Q24 net loss of R$5.8 million versus net profit of R$13.6 million in 4Q23; 2024 net profit of R$7.3 million, down 79.2% from 2023.

• Adjusted EBITDA for 2024 was R$39.6 million, down 41.9% from 2023, with a margin of 57.9%.

• Gross margin remained high at 92.8% in 4Q24 and 93.0% in 2024, with slight declines from prior periods.

• Dividend distribution for 2024 was R$1.74 million.

Outlook and guidance

• 100% of the 2024/25 soybean crop price was fixed at R$107.93/sc, reducing exposure to commodity price volatility.

• Lease revenue for 2025 is largely fixed, with 100% of soybean volume for the 2024/25 crop already priced.

• The company expects operational expenses to stabilize as restructuring is complete.

• The company continues to focus on prudent cash management and maintaining low leverage to support its business plan.

• The company continues to pursue new licenses for forest management and evaluates new uses for properties.