Good morning and welcome to EcoRodovias' first quarter of 2025 earnings presentation. With us here today are Marcelo Guidotti, CEO of EcoRodovias, and Andrea Fernandes, CFO. This presentation is being recorded, and all participants will be in listen-only mode during the presentation. After that, we will begin the question-and-answer session for analysts and investors only, when further instructions will be provided. The slides of this presentation are available on the company's investor relations website in the Results Center section at ri.ecorodovias.com.br. After the end of this presentation, the replay will be made available in the same section. Before proceeding, we would like to clarify that the forward-looking statements that may be made during this presentation relating to EcoRodovias' business prospects, projections, and operational and financial targets are based on the management's beliefs and assumptions, as well as on currently available information.
They involve risks, uncertainties, and assumptions, as they refer to future events and hence depend on circumstances that may or may not occur. Investors should understand that general economic conditions, industry conditions, and other operating factors may affect the future performance of EcoRodovias and lead to results that differ materially from those expressed in such forward-looking statements. I will now turn the floor over to Andrea Fernandes, who will discuss the results. Andrea, you may proceed.
[Foreign language].
Good morning, welcome to EcoRodovias' earnings presentation for the first quarter of 2025. We thank you all for attending. We begin the presentation with the highlights of the quarter. Consolidated traffic grew 7%, driven mainly by the performance of heavy vehicles. Adjusted cash costs went down 3.6% in the quarter. Excluding Ecoporto, whose operation is under a transition contract, the reduction was even more significant, reaching 7.2%. Adjusted EBITDA totaled BRL 1.3 billion in the quarter, with an adjusted EBITDA margin of 75%, reflecting the discipline in cost management and sound operational performance. Net income attributable to controlling shareholders was BRL 147 million, while investments in the period were BRL 944 million, reinforcing our commitment to expansion, infrastructure modernization, and user safety.
It is worth mentioning that in the beginning of 2025, we structured more than BRL 11.6 billion in long-term financing, of which BRL 5 billion have already been disbursed. This amount reinforces the quality of our assets, our funding capacity, and the commitment to the execution of our investment plan. Finally, we highlight in March the beginning of toll collection by Ecovias Noroeste Paulista in the section previously managed by TEBE and collection by Ecovias Raposo Castello. In addition, Ecovias 101 signed also in March the settlement agreement, and ANTT published a notice of the bidding process. On slide 5, we demonstrate the operating performance.
Comparable traffic grew 6% in the first quarter of 2025, mainly due to the 8% increase in heavy vehicle traffic driven by the investments made in our concessionaires, the increase in soybean exports, the increase in the production of rice, corn, and soybean, in addition to the growth in industrial production. These results reinforce the quality of our portfolio. It is worth highlighting the 22% growth in heavy vehicle traffic at Ecovias Leste Paulista due to the increase in handling at the Port of São Sebastião and the 15.5% increase at Ecovias Norte Minas due to the higher vehicle traffic following the completion of capacity expansion work, 113 km of road widening, and 11 km of additional lanes between 2023 and 2025.
On slide six, we present adjusted net revenue of approximately BRL 1.7 billion in the first quarter of 2025, up 9.7% due to the increase of more than BRL 130 million in revenue from highway concessions. On slide seven, we demonstrate our cash costs. The highlight is the cash costs results to adjusted net revenue, which achieved 24.9% in the quarter, down 2.6 percentage points when compared to 2024, and 10.4 percentage points compared to 2022. This cost reduction confirms the effectiveness of the initiatives seeking efficiency and operational synergies, innovation, and digital transformation adopted by the company over the last few years. On next slide, slide eight, we highlight the implementation of self-service through the autonomous toll booth at Ecovias Rio Minas, whose collection is automated for toll payment by digital means and cash without the need for toll collectors.
This is the second automated toll plaza implemented on the highways managed by EcoRodovias. The first was implemented in Goiás by Ecovias Araguaia in December 2024. Gradually, this innovation will be expanded to the company's other concessionaires. In addition, we highlight the integration of Ecovias Raposo Castello into the operational control center of the São Paulo Operations Center, which already included the Ecovias Imigrantes and Ecovias Leste Paulista concessions since September 2024. The consolidation of control centers enables the optimization of the organizational structure, in addition to increasing productivity in the management of highway operations. The chart shows the significant increase of 10 percentage points in toll collection by AVI and digital methods, which reached 90%. According to the ANTT resolution, since February 1st, 2025, the use of the physical toll vouchers has been discontinued.
As a result, only electronic vehicles tags will be accepted at toll plazas throughout the country, which has boosted AVI collection, allowing us to reduce our operating costs. On slide nine, we show consolidated EBITDA of BRL 1.3 billion in the quarter, up 15.3%, and adjusted EBITDA margin of 75.2%, which represents an increase of 3.7 percentage points compared to the same quarter of last year. Note the adjusted EBITDA margin of highway concessions, which reached 76.1% in the quarter. Next slide. We present a net income of BRL 147 million in the quarter. Robust operating performance boosts EBITDA while expanding investments in the high interest rate scenario are reflected in the quarter's profit. On slide 12, we highlight EcoRodovias' focus on the execution of investments and delivery of works to expand capacity and improve highway concessions.
We invested BRL 944 million in the quarter, highlighting the delivery of 13 km of road widening works, additional lanes and frontage roads, implementation of seven intersections, in addition to two overpasses. On slide 13, we ended the year with consolidated leverage of 3.9 x, an increase of 0.5 compared to 2024. This is due to the funding for the payment of the concession fee by Ecovias Raposo Castello, which started operations at the end of March. Proforma leverage, considering the annualized EBITDA of Ecovias Raposo Castello, reached 3.5 x, remaining stable when compared to the fourth quarter of 2024. It is worth highlighting the increase in the average term of indebtedness as a result of the successful financing management strategy adopted by the company in the first quarter.
Contributing to this advance was the long-term financing structured with BNDES for Ecovias Rio Minas of BRL 8 billion, with more than BRL 1.3 billion disbursed in the quarter, in addition to the issuance of the ventures of BRL 1.4 billion by Ecovias Imigrantes and BRL 2.2 billion by Ecovias Raposo Castello. These resources, these funds meet the financing needs of these concessionaires for the coming years and ensure the execution of their investments. In March, the debt of highway concessions represented 71% of total net debt, reflecting a more efficient capital structure and aligned with cash generation from the assets. Next slide, slide 14. The amortization schedule indicates that the company's cash position is more than sufficient to cover the maturities expected for 2025, reinforcing our sound financial structure and adequate liquidity management.
In addition, we are at advanced stages of structuring the long-term financing of Ecovias Noroeste Paulista, whose bridge loan matures in September 2025. Finally, concluding this operation, we will have all long-term financing contracted, those necessary for the investments of our concessions. Now, on slide 16, we also reinforce our commitment to the ESG agenda. The maintenance of the B grade in the CDP, the Carbon Disclosure Project, the company's position in B3's Corporate Sustainability Index, and the recent publication of the 2024 Integrated Report show the consistency of our environmental, social, and governance practices integrated with the long-term strategy. We conclude this presentation by reiterating that the company's focus on the execution and delivery of the works to expand the capacity and improve the highway concessions, as well as on valuing the opportunities that the current assets in our portfolio offer.
We remain committed to operational efficiency, strategic cost management, safety, and with advancing digital transformation and innovation initiatives. We would now like to move on to the questions and answers session. Thank you.
Thank you. We now begin the Q&A session for investors and analysts. If you wish to ask a question, please press raise hand. If your question is answered, you may remove it from the queue by clicking lower hand. Our first question, Pedro Tíneo, Itaú BBA. Pedro, your microphone is enabled.
[Foreign language] . Good morning. Thank you for taking my question. I have two. The first is for the year 2025. We have a broad pipeline of possible new highways entering into new concessions.
I'd like to understand a little bit about your mindset, considering Raposo Castello that was recently acquired, whether there is enough room or if you're looking at it. What's your mindset about this pipeline? I'd like to explore on my second question, especially about margin. There was a good evolution in EBITDA margin, especially in highway concessions year on year. I'd like to understand how we can do this over the year since we're going to have Raposo Castello's participation and we should already start contributing with a stronger EBITDA margin. How can we think about the evolution of margin during this year, thinking about the closing of 2025? That's it. Thank you.
Good morning, Pedro. This is Marcello. Thank you for your question. About the first on the pipeline for 2025, we are aligning these. We're now focused, obviously, in the bidding process of Eco 101.
That's a concession in our portfolio that will go to the bidding process in June. We're focusing on the execution of CapEx of the recently won Ecovias Raposo Castello, structuring it. So far, we do not prioritize new bidding processes this year. Of course, we have a team that keeps track and studies all of that, and we always look into the opportunities. As a strategy, I would say that this year we're focusing on 101 and the execution of our contractual obligations throughout the year. About the EBITDA margin, I think we can, today we're at 75%, we can consider this margin as something sustainable. We do not see margin deterioration. Maybe, of course, there may be upsides and they may go up.
Ecovias Raposo Castello does not participate in the entire year margin, but it definitely has a higher margin and will contribute to potential increases. I would say we can maintain this level and, being conservative, we'll maintain it or maybe increase it.
Great. Guidotti, thank you.
Our next question, Rafael Simonetti, UBS. Rafael, your microphone's been enabled.
[Foreign language]. Hello, Guidotti. Andrea, thank you for taking my question. I have two questions, actually. The first about the CapEx implementation, if this is going according to plan. On this point, something a little bit, I'd like to understand this global movement of tariffs that has been affecting FX and oil, if that can have any relevant reflection for your operation. My second question is about the beginning of operation at Raposo, if it's performing according to your expectations. Thank you.
How are you, Rafael? Good morning. About your CapEx question, this has been aligned with our program. There are some delays in some cases, especially Ecovias Araguaia, which is in the phase of finally receiving its environmental license and may recover it. The others, Minas, Noroeste, Ecovias Rio Minas, Ecovias Noroeste Paulista, are already with their works under development. It's normal at the beginning of the year. Everything indicates that we are within the fair timeline. About the discussions of tariffs and increases, we do not see a lot of repercussion in the short term. I think it's still too early in terms of cost of oil and what impacts may come. I think it's a little bit hard to have a clear view, but initially we contract locally. We have companies who support us locally, a lot of services.
The cost of labor as well, we do not have any view that there is any clear of what could happen, but we do not expect any type of impact on our side. Again, our business is very local, supported on the local economy. We are quite confident. We do not anticipate any problems. The last question about the Raposo operation, it started well. It started as expected. Now we are adjusting all the aspects of software collection system. We are working at a normal. It is a huge operation, but it is everything according to expectations. There are some works now, as you know. The West, VOS works are still delayed. Of course, that somehow impacts a little bit the arrival and it removes opportunities because it causes some more traffic. That was, these works are expected to be concluded very soon and that should normalize the corridor.
It was expected and everything else is under control. Now we're obviously deep diving into the executive projects and the works that started in the third year. Doing all the engineering work and seeking alternative, better solutions that reduce the cost of CapEx. Thank you, Rafael.
Excellent. Thank you.
Next question, Julia Orsi with JP Morgan. Julia, your microphone's enabled.
Hello, Andrea, Guidotti, good morning. It's 2.0 on our side. The first about traffic, the numbers remain very strong on recent years, months, especially heavy vehicles. What do you expect in terms of traffic performance for the second half and for 2026? If we should expect any normalization of performance at some point. The second question, a follow-up on capital allocation. The past few quarters we've been discussing at the call, the potential divestment of some specific assets. These discussions, are they still ongoing?
Where are you with that? If anything is announced, does it make sense for Eco to start to look at other assets in the auction pipeline? Thank you.
Okay, thank you for the question, Julia. In terms of traffic, for this year, we're working with growth at around 4%. We have assets in our portfolio that have been standing out, including to the ABCE and DAX. The assets that we won in recent years, I would say that they are already performing. They had a robust history, and even they have been surprising us positively. For this year, it's something around 4%. Looking at next year, I'd say something around 1.5%-1.8% according to the GDP of 2026. Your second question was capital allocation, operations, and portfolio. We're not at this time. We tested operational last year.
Obviously, considering the micro and macroeconomic conditions, it was not a good moment for equity operations, and we're not at this time looking at other alternatives. It is a strategy to the medium and long term that may make sense to us. Of course, we monitor and sit down and talk and see the situations. This type of operation, yes, is a possibility for getting more stamina and getting a more active participation in the primary market. Both things are connected, the active participation and equity operations. At this time, we are not really putting a lot of emphasis in this strategy. It's not ruled out, but excellent. Thank you.
The questions and answers session is concluded. I would like to turn the floor to Ms. Andrea Fernandes for her closing remarks.
Good morning. I would like to thank you all for attending, and I remain available as well as my team and investors' relations for any doubts you may have after the call. Thank you. Have a great weekend.
[Foreign language]. EcoRodovias' earnings conference call is concluded. We thank you all for attending. Have a great day.