Ultrapar (UGPA3) Q2 2024 earnings summary

Executive summary

• Recurring EBITDA reached BRL 1.282 billion in Q2 2024, up 37% year-over-year, mainly driven by Ipiranga's performance.

• Net income for the quarter was BRL 491 million, a 106% increase year-over-year, supported by EBITDA growth and lower net financial expenses.

• Operating cash flow was BRL 1.3 billion in Q2 2024, up 44% year-over-year, supported by higher EBITDA and improved working capital.

• Interim dividends of BRL 276 million (BRL 0.25/share) were approved for H1 2024.

• Investments and acquisitions totaled BRL 1.8 billion in 1H24, including strategic moves in Hidrovias, Witzler, and service stations.

Financial highlights

• Net revenue for 2Q24 was BRL 32.3 billion, up 9% year-over-year, and for 1H24 was BRL 62.7 billion, up 4% year-over-year.

• Recurring Adjusted EBITDA for 1H24 reached BRL 2.59 billion, up 32% year-over-year.

• Net income for 1H24 was BRL 947 million, an 85% increase over 1H23.

• Gross margin improved to 6.5% in 2Q24 from 5.7% in 2Q23.

• Operating cash generation in Q2 2024 was BRL 1.298 billion, BRL 400 million higher than Q2 2023.

Capital allocation and financing

• Net debt at the end of Q2 2024 was BRL 7.7 billion, down from BRL 8.0 billion in June 2023.

• Leverage decreased to 1.2x net debt/EBITDA as of June 2024.

• Ultragaz issued BRL 700 million in debentures in July 2024 at a cost below the current average gross debt.

• Net debt figures do not yet include BRL 222 million from the Extrafarma sale, received in August.

• Net debt reduction supported by operating cash generation and asset sale proceeds.