Good morning, ladies and gentlemen. Welcome to Orizon Valorização de Resíduos video conference to discuss the results for the fourth quarter of 2024. This video conference is being recorded, and the replay can be accessed on the company's IR website at ir.orizonvr.com.br. The presentation is also available for download at the result center on the company's IR website. We would like to inform that the participants attending the conference will be in listen-only mode during the presentation. We will then open the question and answer session when further instructions will be provided. Before proceeding, we would like to clarify that any forward-looking statements are based on the beliefs and assumptions of Orizon VR's management and current information available to the company. These statements may involve risks and uncertainties as they relate to future events, and therefore, depend on circumstances that may or may not occur.
Investors, analysts, and journalists must understand that events related to macroeconomic environment, industry, and other factors could cause results to differ materially from those expressed in the respective forward-looking statements. Present at this conference are Mr. Milton Pilão, CEO of Orizon, and Mr. Leonardo Santos, CFO and Investor Relations Officer. I would now like to turn the call over to Mr. Milton Pilão, who will start the presentation. You may proceed, sir.
Good morning, everyone. Thank you very much for attending our call. I'm here with Leo, our CFO, to present the results of the fourth quarter of 2024 and the full year of 2024. Leo, shall we go over the highlights? The first highlight that we'd like to discuss is the real gain in price at 9%. We have been commenting this for some time.
We have the gate fee price, and it has been following a pathway of going after the international prices. Those prices have been increasing above inflation levels, as we mentioned, 9% year-on-year, and it's likely to be happening, as we have seen in the fourth quarter. Obviously, it brings a direct result on our margins. You can see that our prices increased by 9%, and our prices and gross margin increased by 8%. Then we would like to mention the volume of waste that increased by 4% year-on-year. We didn't have an actual increase in the volume of the waste because the landfills that came into play in the past few months will start to mature.
In this first half of the year, we are going to see more important tables in terms of volume, but we have a gain in volume by 4% year-on-year. Then we would like to talk about the execution of investments in biomethane. This was an expectation that everybody had, considering the importance of those plants of Jaboatão and Paulínia that started operation in the third quarter of that will start in 2025, putting 300,000 cu m/d of biomethane in production in the market with representative EBITDA for the company. The good news is that both projects are on track, on budget. Jaboatão in the fourth quarter had already reached 90% of its schedule. We are in March, and I can say that the plant is already ready for commissioning.
We managed to execute both plants, and we are also executing Jaboatão and Paulínia on track financially and on schedule. In this area, we have some other plants being contracted that will help us reach the same level of CapEx with schedules and programming as good as Jaboatão or maybe lower. In terms of strengthening the BioE, it is important to talk about the agreements that were completed in terms of sales of biomethane. We are going to have a deep dive about this shortly, and the market is very heated. Petrobras has an interest of 700,000 cu m. Yesterday, we presented the proposals, and we continue to be very optimistic with the agreements and the positioning in the market of biomethane. Lastly, we would like to talk about the improved results in circular economy. It comprises co-processing plants as well as mechanized selection plants.
As I had mentioned before, we managed to have a contribution margin in the UTM in the sorting plant that has been in a ramp-up for two and a half years, and it has reached a level that it will start generating results, and we will continue improving this positioning, gaining in prices of recycled items. This is a very important highlight for the quarter. Moving into a deep dive, considering all the highlights and a little bit of what I have already mentioned. We sold the biomethane contract for the term of 10 years, and the second semester of 2027 will be when we will start providing. The price is similar to what we had in the past. It is a take-or-pay pattern, and this is what we have been doing in biomethane.
Considering the new project, we have also completed the contract in a partnership with Gás Verde for the production of biomethane in Nova Iguaçu and São Gonçalo landfills, with the production estimated about 180,000 cu m/d Both landfills are in the process of contracting in the first half of this year. We also completed the contract of purchase and biogas from Piratininga, which will add 25,000 cu m of biomethane. As for carbon credit, we would like to remind you that in the fourth quarter, we have completed the registration of the projects of Ecoparks of Sergipe and Maceió, bringing the possibility of recurring sales at 1.2 million- 1.5 million a year. We would like to mention carbon credit. Correction. I would like to remind you that for this quarter, we have enormous backlog for the sales of carbon.
Recently, we made important sales of carbon credit. So this year, we like to have good news in terms of sales of carbon. So it is very important that all those products should be registered. Lastly, these are the highlights for the fourth quarter. We would like to mention the financing agreement of biomethane Jaboatão project. It is very important in terms of funding and financing costs.
We managed to have the first disbursement in Jaboatão plant with a term of 15 years and interest rate of IPCA + 3.3% a year. So that shows that for all the biomethane plants, we are going to get this kind of financing at low rates and a long duration for the construction of biomethane plants for the company. I will turn the call to Leo so that he can discuss the financial highlights, and then I will be back to talk about the perspectives.
Thank you, Pilão. Good morning, everyone. Here, we would like to show on this first chapter on page nine, the operational highlights of the fourth quarter of 2024. In terms of waste volume, we are very much in line with the previous quarter at 2,2 million of received waste. Energy generation suffered a little reduction in relation to the same period of the previous quarter, but nothing really structural. So 96,000 of megawatt hour, very much in line and a little bit higher than the last quarter. Biogas capture is very much in line with the last quarter and 11% higher than the same period of last year. The carbon credit following suit of the biogas, very much in line with the previous quarter. In relation to the year, as Pilão mentioned, we had a 4% increase in the volume received in our projects in the year 2024.
It is a very important composition growth in volume and higher prices of inflation and the revenues performing well in relation to the previous year. Energy generation in line with what we saw in last year. Biogas capture, an increase of about 15% above 2023, reflecting the projects that we have been implementing and that are starting operating. In relation to the financial highlights, total net revenue follows the price increase that we verified, and the whole has also a better revenue in biogas and biomethane. So a total net revenue growth of 16% in comparison to the previous period. Gross profit and gross margin had a relative gain, as mentioned by Pilão, driven by the increasing prices and also as a result of the results of circular economy, a gross profit of 60.9% against 51.7% of 2023.
When you look at the full year of 2024, you are going to see that this will have an even greater impact. EBITDA had a gain of 24% in the fourth quarter of 2024 when compared to the fourth quarter of 2023. So that everybody can be on the same page, in the fourth quarter of 2023, if we only look at the accounting results, there were non-operational events, the sales of assets, the recognition of other aspects. It is important to mention that in the fourth quarter of 2023, there were two points that must be considered, and probably it called your attention in general. One is related to the SG&A. It is important to mention that we had nothing relevant in structural terms. In our SG&A, we recorded relevant Funds with a strengthening on the regulatory environment.
We had important decisions along the half of the year in terms of the regulatory aspect of the sector. In this quarter, we had the consolidation of new projects and M&As being consolidated. We had the acquisition of the thermopower plants, Ceará, as well as other projects of biomethane, biogas in the assets of Rio de Janeiro, as well as third-party assets, where we bought biogas to generate biomethane for 2027. There was an increase of SG&A, which is linked to the maturity of the new project investment in specialized consultancy, in operational design, efficiency, and we had an expansion of project. Another point that has been questioned in our call in relation to the PDD, that is in the line of other expenses. We would like to mention that this PDD does not reflect any recurring or structural effects. There is nothing to worry about.
At present, the company has no relevant case of default of some clients. The values that are provisioned are related to receivables that are about two years delayed. It's also connected with the previous management of assets that had been acquired. in 2022, there were important M&A transactions. We purchased important assets. During this transition, we have some receivables that we are looking at court. We expect to have a very positive result in the short term, but we've made the provisioning. On page 13, we bring the consolidated numbers for the year of 2024. There was an increase in revenues from BRL 776 million- BRL 903 million, and gross margin also increased, and the EBITDA performed 30% higher than the EBITDA reported in 2023. In the next slide on page 14, we would like to share the CapEx numbers for the quarter.
CapEx, which is very focused on the plans of Barueri and also of biomethane of Jaboatão. The total CapEx that was related to maintenance is BRL 30 million. Below the table, we can see some items related to investments that we made along the fourth quarter of 2024. Lastly, we'd like to end the session of financial highlights, and we would like to share the capital structure. The company reported a slight increase in the debtness level, but nothing relevant compared to the previous period. Our net has a very elongated term, so we have always looked at the leverage together with the allegation.
This net debt, a major part is connected to biomethane in Jaboatão, and also recent acquisition, whose results are not reflected yet in the operational results of the company. If we look from another perspective, the EBITDA of the company, we do not have the EBITDA reflected in terms of revenue that are going to be included. They do not reflect the new project. Otherwise, we would have it twice as much. I'll turn back to Mr. Milton [inaudible] for him to discuss the perspectives.
In relation to 2025, what I can say here, as we have mentioned recurringly in the last calls, it's a year where we are very optimistic for the company. There are many gain fronts, among which what you can see on the slide, we expect the maturity of prices and volumes. We are going to continue looking and seeing expressive increases in actual terms. We have already been seeing this in the first quarter, and we are likely to see it along the year.
This is going to be one of the strongest years in terms of gate fees increase, and the volumes are likely to increase from other landfills. It will represent an important growth in relation to what we did last year, as we managed to have gains above the inflation levels. The second line is the disciplined execution of CapEx plan, and this will ensure the entrance of a representative EBITDA for the company. As mentioned, leverage has its debt connected to projects that still are not generating revenue. These projects will start operating in the next few quarters. Barueri will be in operation in January 2027, and they will double or increase the revenues, and we are ready to start receiving the revenues from those companies that will start maturing. We are also focusing on the monetization of biogas in the line of biomethane.
As I mentioned, there has been an increased demand from Petrobras and also other players who are getting into the area of demanding more biomethane. Substitution of diesel will bring lots of opportunities. We are very optimistic on this front. We are also optimistic in terms of carbon credit. We restructured our division of carbon credit sales, and we are operating with a division that operates directly with international clients. As I said, right in the beginning, we have a backlog of quotations of sales of carbon credit, and we understand we have lots of chances to revert all this backlog into actual sales. There has been a very important lot last week, as an example, and we are likely to see this going on along with the quarter. We are very optimistic with the turn back of demand of carbon credit.
The fourth point I would like to talk about, the strategic positions that we made. Today, we have a pipeline into due diligence of some million tons. Acquisitions that will bring a lot of value to the company. They will increase our position as a consolidator in the market and will bring value to the shareholder. Also acquisitions that have been searched for during months and all the registrations being executed and actions are also being performed, and we are likely to have all this completed along the period. In addition, there is the strengthening of the regulatory and social environmental agenda. In addition to the Fuel for the Future Law, we are also focused on the legal framework to give the last push of closing the dumpsites in Brazil. That will also boost our volumes and prices.
Also the circular hallmark that will also bring increased revenues that will come from recyclable items, with also credits of recycling activities. So the regulatory framework giving a positive push into our businesses and can bring an increase in prices in the carbon. So we continue to be very optimistic with all the regulatory dimension. In summary, we expect to have year 2025, a very profitable, robust growth coming from different fronts. Once again, thank you, and we are going to open the Q&A session.
Thank you. We are now going to start the Q&A session for investors and analysts. If you wish to ask a question, click on Raise Hand. If your question is answered, you can leave the queue by clicking on Lower Hand. Our first question comes from Maria Carolina Carneiro with Banco Safra. You may proceed, ma'am.
Hello, everyone. Good morning, everyone. Thank you very much for the call. I have two questions on my side. You have already addressed the SG&A point, but we can see that you have some assets to be developed, especially in the methane dimension. Can we consider this level of the fourth quarter as a level close to reality, at least when they are being developed? Or if we look quarter-on-quarter, any of the expenses that you mentioned in the call, are they not going to be recurrent? Just for us to have an idea of what would be a normalization for your portfolio, considering that we have some volatility in the SG&A. The second question is related to the highlights you gave for circular economy on the average price of recycled items.
There was an increase, but I would like to understand what would be a general view in terms of the overview of the segment, in particular, the demand, the partnerships that you have established in some fronts that would have resulted in gains. If you could mention what are those fronts and what can we expect in terms of price levels for the future. Thank you.
Carol, thank you for the question. I am going to start from the first part, SG&A, and then Pilão will talk about the recycled items prices. In relation to SG&A, there are two events to consider. On the one hand, specific aspects in relation to victories that we had, as I mentioned in the regulatory environment, that we had consultants, legal advisors that were providing help to us. There were some expenses that impacted the SG&A.
We have some of these reflected along the year. Still this year, 2025. There were some things that were paid installment, associations, et cetera. We are going to see the impact on this half of the year. There were some M&As that were completed because we saw opportunities of new projects, new businesses, new acquisitions, and there is a high cost connected to those acquisitions. We can always look at them as something specific. Of course, if you have a regulatory important agenda and you also have an important M&A agenda, you may have this happening at a higher frequency. But these are all related to businesses that would add value. Because if we do not have those expenses will not occur. Yes, the company is getting ready to receive a higher volume of waste, and there is a part which is more structural.
As you are going to see in the next quarters, we have a very competent team of consultants providing support to us in terms of organizational structure, improvements in the purchasing process. This is going to be reflected along 2025 and 2026. This is what I can say about the SG&A of the company in terms of circular economy, specifically.
If I could divide the topics, because I understand that you are more interested in the sorting area. We can see that the results have been important, and they are likely to be recurrent for the future. Especially this thermopower plant started operating with profit because there was a higher increase by 21% in the recyclables. This is a result of the regulatory changes or improvements. I do not know if you saw, according to the law, now it is prohibited to import recyclables.
We have some regulatory actions being discussed at the Congress where some areas, for example, glass area, has already defined the minimum percentage of recyclables in these components. This will make the price of recyclables to be increased. The regulation associated with circular economy is going to continue moving the prices up, and that will improve the margins in our sorting plants.
This year you are likely to see some very interesting news. For the new plants, we are bringing a new modality, which is the modality that has been used in Europe, which is a gate fee paid by the generator of waste for the waste which is processed in the plant. This is going to bring a much higher means of financing. You are going to see the first project in this modality will come out in the second quarter. If it is successful, we are going to replicate this model to the other thermopower plants, and this will improve the results in this division.
Perfect. Thank you very much.
Thank you.
Our next question comes from João Pedro Herrero with Santander. You may proceed, sir.
Good morning, everyone. How are you? Thank you very much for taking my question. I have two questions on my side. First, I would like to know if you could talk about the expectations of the Petrobras auction. Do you have any reference of volume that you can expect in this auction? In addition, I would like to know if you could provide more details on the journey of CapEx for the future for waste disposal. Is it likely to be similar in terms of price per ton, or will there be any changes?
Hello, João Pedro. Thank you very much for the questions. Starting from the auction, I believe Pilão mentioned that we are very optimistic about the auction. We cannot provide any information or disclose the volumes or price levels, but the auction is a perfect fit to some of the projects that we have or a large number of projects that we have available with available molecule in the short and medium term. So we are very optimistic, and we are looking at that in a bright way. In terms of CapEx level, if you look at 2024 in terms of final disposal, it is not very likely that it is going to be very different. There is something like the treatment of leachate. You have to look at how the landfill expands in terms of maintenance. We have to look at what is going to be recurrent.
In terms of expansion, we have to look at the assets. We can provide more information. You are invited to get to know our operations to understand what would be the probable variations in the short and medium terms. So in terms of maintenance, it is very clear. For expansion, you can look at the leachate treatment, and you can also look at the assets that we had in terms of expansion, such as Itapevi, and it had a very large CapEx in relation to that specific project. So it is very important to look at all those items when you make the calculations. Only to add some of the CapEx in the treatment area. The main ones, which are not related to maintenance activities. These are one of the highest costs that we have in the operation of landfill is the leachate treatment.
We have a definition for this year and for next year of investing in plants for the treatment of leachate, which will have an impact in terms of costs. With those investments, we will have impacts coming from the CapEx per ton of waste, and that will be very large considering that leachate is very important in the cost of the landfills. These are investments that will generate savings in the cost per ton in the future.
Very clear. Thank you.
Thank you.
Our next question comes from Mario Wobeto with Banco Safra. You may proceed, sir.
Hello. Good morning. Thank you very much for the opportunity of asking questions. I have two questions on my side. The first is in relation to the capacity reserve auction. Could you share with us the opportunities that you are expecting in the sense? The second question is related to an update related to the development of the project of URE Barueri. Thank you.
Mario, thank you very much for your questions. In relation to the capacity reserve auction, we had the phase of registration. We are very optimistic, and we are considering our thermopower plants to take part in projects that we understand that will be focusing on biomethane and no longer electricity. You can see the Paulínia, Jaboatão, João Pessoa. We are very optimistic about the auction. Let's wait and see how the process moves on, and understand if we are able to win. We are very optimistic. Yes, we are.
The focus are the three locations where we have the thermopower plants. In relation to URE Barueri Energy, Orizon holds 80% of the project together with Sabesp. Everything is moving according to schedule, and the completion is expected to happen in 2026. It's the first waste-to-energy project in Latin America, and we have been disclosing, and we also have issued ventures related to this project. The budget is also as expected.
Thank you.
My pleasure.
We'd like to remind you that if you wish to ask a question, click on Raise Hand. Please wait while we collect questions. Our next question comes in writing by [inaudible ]. It says: Good morning. Congratulations on the results. My question comes from the release of results in the portion where you mentioned that in the circular economy, the company is likely to make headway with initiatives in a new format, in which the involvement of local governments will be a key factor to make future plans in the future economically feasible for recycling. Which would be the format? The recycling plants presently implemented haven't brought the economic results as you expected.
Thank you for the question. I'm going to start, and Pilão may add if he wants. Our main point now is that at present, we can see a very important maturing process in the regulatory environment for the circular economy in the country. In the present context, different from biomethane, where you already have a long-term sales contract. On the other hand, you do not have the contract at this level of maturity. Projects I mean that would provide comfort for the players to take all those risks. When we mention this, we see a trend that we see in other countries.
It has been happening in other countries already, and we see some initiatives also by the government in Brazil, where the government would pay or contribute and make the plant feasible, ensuring revenues in order for the activities be implemented. If you have the plants selling recyclables and generating cash, the government is likely to create a metrics that can favor. It may pay an additional value for the disposal price so that he can have the services provided in a location.
You can also have a metric that would be returned to the city or to the granting powers. It's almost a grant the other way around, where you give part of what was contributed for the plan to become feasible. We are studying this, and Pilão said that in the short term, we are likely to have some news in this profile. This is what we have seen so far. This is what we mean when we described this portion in the release.
Again, to ask a question, just click on Raise Hand. Please wait while we collect questions. Once again, to ask a question, please click on Raise Hand. Please stand by while we collect questions. If there are no further questions, the Q&A session has come to an end. We would like to pass the floor to Mr. Milton Pilão for his final considerations.
Thank you once again for attending our call, for your participation. Our IR team is always ready should you have any other questions. Once again, thank you very much and have a good day.
Orizon conference call has been completed. We would like to thank you for your participation, and have a nice day.