We'll begin the presentation. Please, Francisco, go ahead.
Thank you for joining us for another Dexco earnings call. I'm here with Raul Guaragna, our President and CEO, and the other members. We'll begin the presentation with slide 3. Starting with the proforma adjusted and recurring EBITDA, which totaled $611 million in the first quarter of 2025, considering LD cellulose 49% of EBITDA, of which $346 million corresponded exclusively to Dexco's business. This result reflects the resilience of the wood division, even without the realization of forestry business in the period, and the operational consistency of LD Celulose. On the other hand, we saw pressure on the finishing division's results due to the natural seasonality and the lower dilution of costs, in addition to sectoral challenges still facing the covering division, as we will see later.
The first quarter performance is consistent with the fourth quarter of 2024, and that included, in the first quarter of 2024, included the forestry business impacting revenue and EBITDA, which was not the case either in this quarter or the last quarter of 2024. Continuing with cash flow in quarter 4, we were able to partially offset the lower operating generation this quarter by carrying out efficiency actions in working capital, with improvements in the customer and supplier lines and greater financial discipline.
Working capital to net revenue had a total of 16%, which was a level compatible with the first quarter of 2024, which was 17%, and in line with what is expected for this time of the year, where there's typically a buildup of inventories in the divisions after year-end vacation breaks. 2024, entering forestry OPEX and maintenance. In the first quarter of 2025, there was a concentration of maintenance downtime with regard to expenditures linked to the investment cycle starting in 2025. In the quarter, we invested $25 million in the new plant in Botucatu, which is already in the ramp-up phase, as we announced last quarter.
$18 million in modernizing the metals and sanitary wear operations, as well as $8 million in expanding the forestry base in the northeast and $3 million for DX Ventures. It's worth noting that the capex levels for this quarter are in line with the same quarter last year, and at the end of the investment cycle, disbursements related to this line will be substantially lower in 2025.
Continuing with slide 5, which discusses our corporate debt, we had an increase in the leverage indicator, which ended the quarter at 3.45 x net debt to EBITDA, reflecting lower operating cash generation and investments in projects. The average cost of debt reflects the behavior of interest curves pressured by the unstable macroeconomic scenario, especially with higher short-term interest rates here in Brazil. The composition of our debt remains heavily weighted towards long-term debt and annually balanced maturities. We maintained an average maturity of 4.1 years and continued to balance costs and maturities to improve liability management and preserve the company's financial health.
Continuing with slide 7, starting the discussions on the wood division, according to Ibá data, the domestic panel market continued to grow compared to the first quarter of 2024, with growth in both MDF and MDP sustained by the heated demand coming mainly from the furniture industry. On the other hand, foreign markets strengthened mainly due to international macroeconomic instability, which reduced the appetite for higher value-added imports.
Turning now to the division results on slide 8. We ended the quarter with an adjusted and recurring EBITDA of $350 million and a margin of 27.2%. Here we have some important messages, such as the fact that in the first quarter of 2024, forestry deals were carried out, which ended up impacting the component base for the period. We therefore are presenting a pure result for panel operations in the first quarter of 2025, reinforcing the consistency of our operations. The most important point is the profitability we were able to achieve this quarter, confirmed even in comparison to the fourth quarter of 2024. We posted a very similar result to the last quarter of last year, with an increase of 0.8 percentage points in the adjusted and recurring EBITDA margin, reinforcing our commercial strategy, considering, of course, the usual seasonality at the end of the year.
The results of the last quarter of 2024 showed commodity cost pressures in dollars. These pressures eased in the first quarter of 2025, and we went through a combination of the two quarters with sustained margins for a correct strategy of price positioning, product mix, and robust client support.
[Foreign language] Which is aimed at manufacturing efficiency and the best arrangement for meeting market demand. Which is why in 2024, they were concentrated at the end of the year. Continuing with LD cellulose, which continues to show a strong operational performance and a net revenue of $843 million in adjusted and recurring EBITDA of $542 million, a margin of 64.2%. This reflects the normalization of operations compared to the first quarter of 2024, which was a period impacted by scheduled maintenance stoppages, as well as efficiency and productivity gains that have been sustained over the last quarters.
Net profit also made a significant advance, reaching $252 million in the first quarter, representing the LD's robust operational performance and the one-off accounting effect related to the evolution of the exchange rate in the first quarter of 2025 compared to the fourth quarter of 2024. We now turn to slide 11, where we will talk about the sector environment for metals.
The construction materials sector is showing signs of recovery in the recent quarters, driven, for example, by the progress of housing demand in the country. According to Abramat data, the industry ended the quarter with growth compared to the first quarter of 2024, with sanitary wear standing out. Finished products. However, it's worth noting that we have seen a downtrading movement in these products, where those with lower added value ended up having greater weight in the consumer's purchasing options. In this sense, even with growth, we understand that the current economic scenario is still not favorable, with the short term proving to be quite sensitive. Continuing with the metals and sanitary wear division results on slide 12. In 2025, we posted a positive adjusted and recurring EBITDA of $8 million, reversing the negative result we had seen for the same period of last year.
This reflects the gain in market share and higher added value categories and the improvement in the product mix, which contributed to growth in net revenue compared to the first quarter of 2024. In the first quarter of 2024, the electric showers and taps operation was still in results, and they had a significant impact on the division's volume. As communicated in the previous quarters, we left the segment in the second half of last year, and when we disregard this operation in 2024, we saw a revenue growth of around 6% and a revenue growth of the same. F rom an operations point of view, the metal segment continued to be a highlight in occupancy, increasing efficiency and contributing to robust margins within the division.
We captured information on an increase in sell-out in the quarter, accompanied by an increase in sell-in, which indicates a healthy replenishment of our customers' inventories and good positioning of our products under the deca and Hydra brands. This move was strategic and in line with our working capital composition policy, aimed at improving services. Continuing with slide 13, we have the tiles sector environment.
Although the wet market where Dexco is present has showed growth in the quarter before, and especially with the sell-out by significant sell-in actions in January, accompanied by significant reductions in the price levels charged and drops in volumes in subsequent months. Even so, the sector as a whole was impacted by the retraction of the dry market and high levels of stockpiling, which put pressure on capacity utilization and intensified competition in the market. Profitability challenges remain high for the entire industry. Let's continue with the results for the tiles division. This quarter we've seen commercial initiatives to recover market share, and this resulted in volume growth. High levels of competition in the sector impacted both the composition of the product mix and price levels, which resulted in a drop in net revenue.
Another relevant point when it comes to cost was that, as expected, this quarter was marked by the ramp-up of the new Botucatu plant. Considering the integration of this new operation, maintenance downtime at the end of the year in the south of the country were extended until mid-January in order to readjust for moving production and portfolio. This had a direct impact on the cost dilution and, as a consequence, on the results for the period. Thus, we ended the first quarter of 2025 with an adjusted and recurring EBITDA of -$12 million, reflecting a combination of the competitive environment and an increase in costs. Here, I'd like to point out that we continue to pay close attention to the performance of the new Botucatu unit, focusing on operational efficiency and value-added products, which should contribute to the gradual recovery of these results.
We now continue on slide 16, which discusses our prospects. I'd like to highlight the main prospects we will see for the coming quarters of 2025. The wood division continues to have solid fundamentals, supported by resilient demand from the furniture industry. We are maintaining our strategy of focusing on a higher value-added mix and expect to maintain the good profitability levels we have seen so far. With LD cellulose, the operation maintains consistent performance with high levels of efficiency and productivity, even in face of a more volatile global scenario. We are confident in the stability and competitiveness of the solvent compared to other fibers, and especially in LD's attributes to face the competitive market.
[Foreign language] optimizing portfolio and improving the use of industrial assets, should contribute to the gradual recovery of results, especially as the ramp-up of the new tiles progresses. This context for the Dexco concept store is positioned as a relevant vector for profitability, strengthening our presence among retailers and some of our customers. We have continually invested in products that differentiate ourselves from the market, with technologies and applications that expand our premium portfolios, such as the Ceusa or Castelatto and Portinari brands, which are large and significant advantages to Dexco in this time, reinforcing the competitiveness of the diversity of different segments.
Do ponto de vista macroeconômico, a manutenção de taxas de juros em patamares elevados, reforçado pelo aumento de impostos, reforçado pelo que foi anunciado por Haddad, especialmente a construção de mix de produtos e manufatura para produtos acabados, especialmente o crescimento, é certamente negativo para nossa indústria e aumenta a trajetória e velocidade. Ainda há muita incerteza sobre as decisões no futuro, o que gera a necessidade de tomada de decisão por nossos clientes e os clientes finais de nossa indústria. Por outro lado, historicamente temos mantido preços de madeira em pé sem sinalizações de alteração a curto prazo. Ainda em níveis historicamente altos, sem sinais de mudanças no mercado. Continuando com a priorização de capital, disciplina, focando na geração de caixa e redução de alavancagem, agora que o ciclo de investimento está chegando ao fim. Permanecemos comprometidos com a eficiência operacional e a criação de valor sustentável. Obrigado.
Iniciaremos agora a sessão de perguntas e respostas para investidores e analistas. Caso deseje fazer alguma pergunta, por favor, clique em "Levantar a Mão". Se a sua pergunta for respondida, você pode sair da fila clicando sobre "Abaixar a Mão". A nossa primeira pergunta vem da Senhora Tatiana Matieri , de JP Morgan. Por favor, pode prosseguir.
Bom dia.
Good morning.
Good morning.
Bom dia. Obrigada por pegar minhas perguntas. Eu tenho duas aqui do meu lado. A primeira é pensando no segmento de madeira. A gente tem visto essa melhora na demanda quando a gente está pensando simplesmente em painéis de madeira. Então, olhando os resultados, existe uma melhora. Eu vi uma demanda diferente como vocês mencionaram, mas eu queria entender assim, desse segundo trimestre, como que vocês já estão vendo nesse primeiro mês, nesse quarto de maio, como que está sendo essa demanda também no trimestre. Pensando no segundo semestre, a gente, de novo, como vocês mencionaram, a gente tem uma taxa de juros que está impactando o setor macro, a parte macro do país. Eu queria entender quais parâmetros vocês acompanham para fazer a decisão da venda de madeira em pé ou não no próximo trimestre.
E com quanta antecedência eles têm que ser decididos ou se isso é uma coisa que vocês conseguem fazer de forma ligeiramente rápida para pensar no resultado? E minha segunda pergunta já é mais pensando em revestimentos. Desde o fim da pandemia, depois de 2022, a unidade tem sofrido pouco com a competitividade, pressão de preços, e a gente tem visto resultados, alguns trimestres apresentando resultados melhores, outros contraindo de novo. E a gente tem falado sobre o turnaround, mas ainda a gente não está vendo a consistência dos resultados se refletindo. A gente tem o feito de Botucatu entrando, mas minha pergunta aqui é para vocês: quando que vocês esperam atingir essa estabilidade, que a gente possa pensar num longo prazo, pouco menos de volatilidade no segmento? Obrigada, gente.
Obrigado pelas perguntas.
Thank you for your questions. So we're going to give you a little bit of this panorama. Give you a panorama of the wood division and LC. So first, we will get an answer from Henrique Potomati, and then Raul will answer your next question.
Hello, this is Henrique Haddad. Speaking about demand, what we have seen is that there is resilience in learning about seasonal patterns again. In the last few years, we have been used to being surprised between the first and second quarters, and we try to keep track of that. What is happening now is that we have had better performance in the industry with planned furniture, and as a consequence, retail. This has been a reality in the last quarters. In wood, where we have a significant part of our sales, we're also having a solid performance. We need to be closer to consumption due to reforms and refurbishments. As you know, it's still early to make any mapping. Once again, interest rates are going up. This is not a positive message. We are looking at employment levels.
We're looking at supporting the Minha Casa Minha Vida program launches, and this generates a very positive outcome.
We don't have any bad news.
Muito obrigada, pessoal.
Thank you, everyone.
Obrigado, Tatiane.
A próxima pergunta vem do senhor Marcelo Motta, do BTG Pactual. Pode prosseguir.
Bom dia, pessoal, tudo bem? Duas perguntas aqui do meu lado também. Eu queria falar um pouco sobre geração de caixa, nível de alavancagem da companhia.
Nossa próxima pergunta vem do senhor Rafael Barcellos, do Bradesco BBI. Olá a todos, bom dia, obrigado pelo espaço. Thank you for taking my questions. A flexibilidade da companhia para ajustar o nível de CAPEX gerado para o ano de 2025 já está chegando no próximo fim. Qual é o cenário de manobra que vocês têm atualmente em termos de reduzir esse CAPEX que é pouco mais do guidance, mas ainda continua em patamares elevados? Então, quero entender qual que é o espaço de manobra que vocês têm atualmente em termos de reduzir esse CAPEX que é estimado para o ano de 2025? Essa é a primeira pergunta. A segunda, em relação a custo, explorando tanto madeira como celulose. No segmento de madeira, a gente viu uma dinâmica muito favorável em custo, apesar da manutenção programada no trimestre.
Então, queria entender se esse nível de custo que a gente viu dos painéis, ele é sustentável e se tem mais ganhos para serem incorporados ao longo dos próximos trimestres. E também, olhando o custo de celulose, a gente viu aí uma dinâmica bem favorável. A receita chegou a cair marginalmente, mas o CPV ficou basicamente parado. Então, sim, a gente está vendo uma dinâmica de custos mais favorável. Então, queria que vocês comentassem pouquinho em relação à dinâmica de custos também. Obrigado. A sessão de perguntas e respostas está encerrada. Gostaríamos de passar a palavra ao Raul Guaranha, para que faça as considerações finais da conferência. Thank you for your diligent work and for your diligent work with our results. Your reports are always giving us good insight and also some tougher questions. That helps us reflect on what we do every day.
Dexco will be 75 next year, similar to Itaú and Itaúsa. That means that we have a long-term commitment in all decisions that we make. You can expect a lot of energy, diligence, and a sense of urgency so that we can command things during this tougher time without compromising the future. We have a mission to sustain the business, and we will continue to pursue this with a lot of discipline. Just as we are looking at capital allocation, indebtedness, investments, and really no analysis or scenario will be forgotten in the short term so that we can be at healthier balance levels. Thank you and have a good day. A videoconferência da Dexco concluiu-se conforme convencionado. Agradecemos a participação de todos. Thank you. Tenham bom dia.