Morning, ladies and gentlemen, and welcome to the Orizon BR conference call to release results for the fourth quarter 2023 and the full year 2023. This video conference is being recorded, and the replay will be in the company's site, ri.orizonbr.com.br. The presentation is also available for download at the result center of the investor relation site. All participants will be in listen only mode during the company presentation. Ensuing this, we will go on to question and answer session when further instructions will be given. Before proceeding, please bear in mind that the forward-looking statements are based on the beliefs and assumptions of Orizon BR and the information currently available to the company. These forward-looking statements run risks and uncertainties as they refer to future events and depend on circumstances that may or may not occur.
Investors and analysts should keep in mind that factors related to the macroeconomic environment, the industry segment, and others, could lead to results that will differ materially from those expressed in the forward-looking statement. At this conference, we have Milton Pilão, the CEO of Orizon, and Leonardo Santos, the CFO and IRO. I would now like to give the floor to Milton Pilão, who will begin the presentation. You may proceed, sir.
Good morning, everybody. I am Milton Pilão, CEO of Orizon. I am here with Leo, our CFO. We are going to begin the presentation by first of all thanking you for your attendance at the fourth quarter 2023 earnings release call. This is another year with robust growth in net revenue, EBITDA margin improvement. We are going to begin now. In this slide, we speak about the highlights for 2023.
In the first slide here, you can see what happens with Biomethane. As foreseen, in Biomethane, we were able to expand the contract of sale of Biomethane to Copergás, increasing everything to 90% of the installed capacity of the company, which is already under construction.
The increase is to 130,000 cubic meters a day at the same pricing that was held in the previous contract. Of course, this will bring about security in the supply, almost total security for the plant that began construction in 2023 and will come into operation in the fourth quarter 2024. Additionally, to this, also in Biomethane, we concluded our agreement with Compass Gás & Energia, where Compass Gás & Energia is part of Biomethane, disbursing BRL 100 million contributed to the project and BRL 135 million in a direct payment, secondary payment to Orizon BR and OMA. These resources will be used for the purchase of new assets.
Now, in this agreement with Compass Gás & Energia, OMA has a contract for the supply of biogas for a period of 20 years. Besides this, we have signed a contract for the sale of Biomethane for a minimum price guaranteed and upside sharing of the blending. Therefore, this will be the first version where we are selling a blending of natural gas with renewable gas, which will bring about a gain in the final price for Orizon, and we will share this premium through the sale of this business. At this plant, we also began the construction in the first quarter of 2024, and it will come into operation in the second half of the year of 2025. Still speaking about this current, we are still on the same slide. I would like to remind you that in 2023, we acquired the Porto Velho, Santa Luzia, and Juazeiro landfills.
The contracts are still pending. They should be concluded in the next 30 days. Additionally, to this, we carried out the ramp-up of the circular economy plant. It is a ramp-up that has also taken place throughout Latin America, and in 2024 we will reach the phase of maturity as you will see further ahead. We began the construction of waste-to-energy carried out in partnership with Sabesp in the city of Barueri. We can go on to the next slide, please. Still as part of our highlights, I would like to remind you that we, within the group, have carried out another option for biomethane. We used to say that we would not work with biomethane in all the landfills. We have five landfills that are working with this biogas, with contracts that will be complied until 2030.
Two of them were a contract with Grupo Urca Energia and two very large landfills, Nova Iguaçu and São Gonçalo. We have entered into a new agreement where jointly with Grupo Urca Energia, we will work with this biomethane agreement in two Ecoparques, and this was not part of our pipeline due to the sales condition of the biogas sale. So, this is another biomethane pipeline that we are including into our process. I would now like to turn the floor over to Leo, who will speak about the operating highlights, and I will be back to speak about the outlook. Leo? We are waiting for you.
I am sorry, I was on mute. Thank you very much for giving me the microphone. We begin here on Slide 9, and we will begin presenting the operating highlights for the fourth quarter.
Regarding the volume of revenues, the company has a growth of 3% vis-à-vis the previous quarter. We remind you that we had pointed out to the investors that we would have this new volume of waste volume in Ecoparques in the second half of the year. We have been growing in the third quarter and in the fourth quarter vis-à-vis the third quarter 2023. Energy generation with an increase of 4%, with the use of biogas, and 5% in the volume of carbon credits. When it comes to the figures for the full year 2023, and we had already underscored this, there was an adjustment in the level of volume of waste of 2023 vis-à-vis 2022, with a reduction of 5%. This is the volume that we are operating with.
This is due to a selection of waste that has a better price in the large landfills that we have acquired recently. Generation of energy with a growth vis-à-vis 2022. Biogas, a growth of 28%. Now, still regarding our figures, we are moving away from the operating part, going on to the financial part. The company reported a growth of 24% in net revenues of BRL 626 million in 2022 to BRL 776 million in 2023. With the carbon credits, the growth would have been of almost 40%. We had a growth of 39%, and in gross margin, a growth of 40% to 52%. We now go on to Slide 13, showing you the EBITDA and the growth from 2022 to 2023. In 2023, the figures were filed yesterday, and investors observed that we had BRL 78 million, almost BRL 79 million.
If we were to adjust carbon credits and the losses of some assets that were at a standstill, Paulínia, for example, is on hold so that we can begin to operate in the year 2024. Of course, this gave us a negative impact last year. We were waiting for the maturation of the plant. If the company had sold carbon credits without having a negative performance, we would have reached BRL 105 million with an annual pro forma of BRL 401 million. For the year of 2023, the company reported a consolidated EBITDA of BRL 313 million. If we had adjusted the carbon credits, that was 94,700 in the previous slide, and the losses that we had in some of our plants, the EBITDA would be BRL 422.6 million.
In the next Slide 15, perhaps some of the figures were not very clear in the release and could lead to doubts among investors. Here is the EBITDA with a net result of BRL 92 million in the fourth quarter, BRL 15 million for the year 2023. Adjustments in income tax. We had an accounting EBITDA in the fourth quarter that was very strong, thanks to the revenue coming in from the Paulínia project, along with accounts. If we carry out an adjustment of the BRL 205 million of the secondary issue and the environmental engineering that we carried out at the end of the year, we have revisited the asset that was attributed to the asset that had been, contested, we had negative results of BRL 68 million, and we had the account of others of some write-downs that was done once again in the last quarter.
The net effect, the adjusted EBITDA for the fourth quarter of 2023 is BRL 78 million, and the EBITDA for the year of BRL 313,600 for the full year. When it comes to the CapEx, we have a maintenance CapEx very much in line to what we had reported, BRL 20 million. We will highlight some projects for biogas in Maceió and Sergipe, where we have begun operations in the last quarter of the year. The use of biogas and energy in those two areas began at the end of 2023, and we are also working strongly in the project in Barueri, which is a partnership that we have with Sabesp of 70,300. On Slide 17, we have brought a point that was requested yesterday when we filed our release at the CVM. We then explained what was happening per segment.
For those who took a close look, you saw that the environmental result was much better than what appears here in the fourth quarter, and the treatment of generation seemed to be lower than it was truly performing. So, we have carried out an adjustment, and we have rectified this at the CVM through an explanatory note and adjustment. This is what you will see in the statements that have been published by the company. We are maintaining the historical margin of 54%, energy, biogas, and credit carbon, 87%. In waste, we had a negative result, and in environmental engineering, we have carried out an adjustment this quarter, and it is negative for the year 2023. Very well. This takes care of our financial highlights.
The company had a reduction of leverage in the fourth quarter, thanks to the maturation of the company, those projects that had been underway for quite some time in Porto Velho for the use of waste in the region of Porto Velho. This is as we had mentioned, we went through a moment where our leverage was higher. We have implemented several initiatives. Now we have a controlled CapEx, and our debt extends for the long term. Of course, we have very relevant results in terms of our operational results. Very well, I will return the floor to Milton Pilão to close this presentation. Then we will open up for questions and answers.
Thank you, Leo, for the closing.
I am showing you this graph that you have seen in a reiterated way in the light green, what we are still missing to do in terms of the waste, and in the dark green, what we have already complied with in terms of waste. EBITDA of BRL 303 million recorded last year is only part of the dark green that you see here. As soon as this journey has been completed, and we expect that this journey of efficiency will bring about better results for the landfill, which is gate fee, plus biogas, plus carbon credits, circular economy, and others, that all of this will enable us to increase these results four or five-fold, and we should comply with this journey in the next three or four years. Once again, enhancing the results four or five-fold, both organically and inorganically. So, you are aware of this chart.
It continues to be part of our outlook. Additionally, to this, and to speak about our short-term outlook for 2024, we have a forecast for strong growth in the landfill division in 2024, coming mainly from an increase in volume as we will have the entry of the full year of ecoparques like Porto Velho, Santa Luzia, the total ramp-up of Cuiabá. Alongside this, we will have significant gains in the average gross prices of the company. Once again, arising from a rebalancing of prices for very significant contracts in the company that will mature at the beginning of 2024. We have increased the prices above and beyond inflation, as well as the spot prices in Itapevi, for example. We inherited an agreement and we were not receiving from the client until October.
We have now begun to receive, and this will have a direct impact on the price of that asset. These impacts, both of price and volume in the landfills, will bring about an outlook for 2024 of an increase of 20%-25% in the company's total EBITDA, and everything will arise from that division. We have an additional impact that comes from circular economy in the year 2024. You heard from Leo that we had a negative impact last year of BRL 313 million of minus 38%. This year, the outlook is to have a positive contribution from the asset of circular economy, which will bring about strong gains in terms of the growth of our EBITDA of 2024, coming from this reversal of the results of circular economy. I believe that these are the two drivers for a significant increase in the contribution to EBITDA this year.
Another drive that you are fully aware of, we have obtained the migration of carbon, the first carbon project from João Pessoa. We hope that the next migrations will take place during this year to at least two additional ecoparks, perhaps reaching five ecoparks. This will enable us to account for the carbon in the ecoparks, not only this year, but also for the years in which they were stopped in 2023 and 2024, with a significant impact on the EBITDA of 2024 and our results for the year. To conclude, a question that I always hear, the sale of the carbon is already being carried out. We have contracts that have been carried out between signing and closing, which means we will have no problem with the accounting of carbon credits. Not only the accounting, but also the sales that are underway.
This will help us with the credit carbons migrated during 2024. This will enable us an additional robust growth coming from the factors that I have just referred to, as most of the growth that comes from biomethane will take place in 2025 in Jaboatão and Paulínia, and it will take place in the second half of the coming year. Thank you very much. I would like to thank you for your attention, and we will now open for questions and answer.
Thank you. We will begin the question and answer session for investors and analysts. Should you wish to pose a question, please click on raise hand. If your question has been answered, you can withdraw from the queue. The first question comes from Itaú BBA, Mr. Fillipe.
Morning, everybody. Good morning, Milton and Leonardo. Thank you for taking my question.
In truth, I have two questions, and I would like to make the most of the comment that you made at the end of the certification of the other projects on Gonçalo and others. Is there a greater visibility in terms of your expectations of when this could materialize? Can we expect these certifications to happen still in this first half of the year? If the impact of the sale would only take place in the second half of the year, and which is the dynamic of volume received from the landfills, which has been the behavior of the volumes received at Jaboticatubas and others, and that expectation of enhancement mentioned by Pilão, if this will be applied to these two specific landfills. Well, thank you.
Referring to carbon, I can say that our expectation is that the Jaboticatubas process will have a conclusion in terms of migration at the end of the first half of the year, before the end of June. The rest will be in the second half of the year. In the second half of the year, there is an expectation of another two projects that have been accelerated, and the migration can take place in that second half of the year. Now, when it comes to our sales before the coming year, May 15, I believe, we will bring to the market the conclusion of significant volume of all of this carbon.
Now, the carbon can generate for the company, because of the three projects migrated this year, approximately 4 million tons of carbon that will be accounted for, and the earn-out that will also come from the carbon, which is in a financial volume, not in tons, but it is also part of our balance. I would say that approximately around 1.5 million to 2 million tons will already be put up for sale before the next earnings call. Now to speak about the volumes. If you look at the volumes, we have been growing since the third quarter of 2023. We grew again in the fourth quarter of 2023, and now in 2024, in the first quarter, we are already looking at the volumes. They have all been on the rise once again. We will have a greater growth that we observed in the past.
Now, this volume is fully in line, not only in line, but above what we had budgeted for the first quarter.
Excellent. Thank you very much, Milton.
The next question comes from André Sampaio from Santander.
Good morning, everybody. A very quick question. I would like to hear from you about your expectations of gate fee. The gate fee is somewhat above what we expected, and I would like to know if you are still enthusiastic with the possibility of what is happening with the gate fee.
Yes, André. For this year, the expectation is to have real and robust gains in the average gate fee of the company that was closed in 2023. That comes from the assets that I mentioned. There are several of them, and I will separate them. First of all, the rebalancing of prices above and beyond the inflation for some high-volume clients.
Basically, we always transfer the annual inflation to all companies, but for those who have a greater impact in the gate fee, these are the ones that have higher volume. We are going beyond the inflation for this volume. The impact will take place this year because we have three contracts specifically, where we have very large volumes. These contracts matured at the beginning of the year. On January 5th, we worked with the rebalancing of one contract. The other two will be renegotiated in April. The impact will come from this rebalancing of prices and important contracts that basically are fully contracted and will come into effect in the first half of the year. Also, due to the impact that I mentioned, I do not know if this was clear. We do not base ourselves on assets. We have a negative gate fee at the landfill in Itapevi.
The city hall thought they could sell all of their waste to this landfill and not pay for this as if it were an inverted royalty until October of last year. They would begin to pay in October, which is what was materialized. Everything would appear in the entry volume, but a zero-gate fee would appear. Like this, you have other one-time examples in the company with a strong impact on the gate fee. That is why we have the outlook this year to have a relevant increase above inflation for the average gate fee of the company.
The next question comes from XP Investimentos. Vladimir, your microphone has been unmuted. You may proceed. Thank you.
I also had written in my question in questions and answers, after you had this very successful certification, if you could speak about all of your ecopark, those that you have for the first half of the year and second half of the year, and which will be the levels for the recently released carbon credits.
Thank you, Vladimir, for the question. This is Leo. Let me give you a bit of color regarding the carbon. Can you hear us well now? Regarding the speed of the records, of course, we depend on the entities. We're going to have an exchange interaction with these entities in case of doubts. We do have the expectation of having a large volume of ecopark at the end of 2024. We will have some during the first half of the year, others in the second half of the year.
We're working arduously and João Pessoa has opened up a new path for Orizon. These carbon credits in Brazil only began at the end of last year, so the landfill activity will reaffirm the record of these projects among other entities. When it comes to price, we have been working at the price levels that we had discussed. There hasn't been any significant positive impact that goes beyond the $6 or $7, and there's no concern in terms of this level. This is what we should expect from the transactions mentioned by Milton recently. Thank you.
The next question comes from Jefferies.
Yes. Hello. Quick question, if I may. Could you please give us some indication of how you're seeing CapEx for 2024, first half versus second half?
Hi, Alejandro. It's Leonardo. In relation to the CapEx for this year, you should expect the implementation of the waste-to-energy projects that should consume something like 40%, 42% of the total CapEx estimated for these plants. The two plants of Biomethane of Paulínia and Jaboatão. For Jaboatão, we should deploy something like 70%, 75% of the total CapEx for this plant, and for Paulínia, something like 50%, 55% of the CapEx of this plant. In parallel, we have the maintenance CapEx of the landfills that should be aligned in the same level of the last year. With these figures, you can submit the total CapEx of the company for this year.
[Non-English content]
Okay.
The next question comes from Sergio from Multiplica Capital.
Morning, everybody. Thank you for taking my question. Can you hear me?
Yes, we do.
Do you have any update in terms of the Combustível do Futuro and the PL? The EBITDA curve, how much you're counting on this device or this program going forward?
Well, basically, we're all following up on what is happening with the Combustível do Futuro. I think it will favor the Biomethane initiatives. Naturally, we need to see how all of this unfolds to see if this receives the final approvals. The curve presented by Milton Pilão in the last slide, we're considering the same level of prices that we have been performing with Biomethane, which means there will be no additional gain due to the mandatoriness of consuming Biomethane, and which could increase the prices.
We're going to continue working with the present-day levels, and once we see the draft bill, we can give you a better answer.
Thank you. We would like to remind you that should you wish to pose a question, please click on the raise hand icon.
The next question is from André Sampaio from Santander.
I'm sorry. I'd like to ask an additional question and to hear about the CapEx of Biomethane. If you have locked part of this CapEx, if there are any novelties, of course, it would be interesting.
The CapEx has already been contracted in line with what we have been reporting. They're high figures. In Paulínia, we are carrying out the final adjustments with the suppliers to begin the contracting. We have no cap when it comes to our CapEx as we had conversed, but we're in the final stages of contracting.
In Jaboatão, the expectation is to begin operations in the last quarter of this year, according to Copergás. We have that first tranche that was contracted at the initial stages of the contract with Copergás, and we should begin operating in the fourth quarter. We're awaiting the import of the equipment, and of course, the local authorizations. Everything is underway.
Thank you. Thank you very much. We would like to remind you that should you wish to pose a question, please click on the raise hand icon. The question-and-answer session end here. We would like to return the floor to Mr. Milton Pilão for the company's closing remarks.
Once again, I would like to thank all of you for your attendance and to wish you a very good Easter holiday. Thank you. The Orizon video conference ends here.
We would like to thank all of you for your attendance. Have a good afternoon.