Earnings Call: Q4 2025

Mar 13, 2026

Summary

FY25 revenue rose 26.7%, but weaker margins and Q4 net profit of BRL1m weighed on results. Mining growth and a stronger assembly backlog support the 2026 outlook, while leverage reduction remains a priority.

Secret crush. We want a girl. Want a girl's body. Good morning, everyone, and welcome to the video conference announcing Priner's fourth quarter 2025 and full year results from Priner. My name is Aline Rodrigues. I am the Investor Relations Coordinator, and it is a privilege to be with you this morning. First, we hear from Túlio Cintra, CEO of Priner, and Tarine Jung, Investor Relations Director. We would like to inform you that this video conference is being recorded and will be available on the company's investor relations website, where the presentation is also available. We emphasize that the information contained in this presentation and any statements made during the video conference regarding business prospects, projections, and operational and financial targets of the company constitute the beliefs and assumptions of management, as well as currently available information. Forward-looking statements are not guarantees of performance. During the Q&A, questions and answers, we ask that you submit them by clicking on the Q&A icon located at the bottom of the screen. By default, your names will be announced so you can ask your question live. At this moment, a request to activate your microphone will appear on the screen. If you don't want to unmute your microphone live, please no microphone at the end of the question so I can speak aloud. Now, I would like to give the floor to Túlio Cintra to begin our presentation. Túlio, please proceed. Okay. Thank you, Aline. Thank you listeners for your attention to the company. Let's welcome Tarine Jung, the company CFO who started this year. We are still in a transition phase. Soon, the releases will be predominantly done by the CFO and Investor Relations Director who just arrived here at Torino. I would like to invite everyone to read the message from management, which will greatly facilitate the understanding of our numbers from last year. Last year, the highlight was the acquisition of Semep, which has already been widely announced, but I insist that this is something so transformational for the company that you will see the firepower we gained from it. We achieved a pro forma ROIC of 11, the lowest ROIC in our history since the company's inception. The adjustment of 14. The adjustment of 14 is because there are BRL 23 million in this period amortization of intangibles, which are payments from the acquisition. We also have BRL 82 million in taxes on assets that will now be offset with the incorporation of other companies such as Real, SCMGL, Soelle, and I believe Maia as well throughout 2026. We will start to make use of this. Therefore, it is quite fair to analyze this adjustment. We achieved net revenue of BRL 1.6 billion, almost 26%-27% higher than in 2024. When I call 2024 professional, it's because it captures the actual structure between July and December. Our accounting profit was BRL 96 million, and our operating profit was BRL 97 million, BRL 95.7 million. The adjusted profit, in the adjusted figure, I include the amortization of intangible assets because that's not operational. I think it's also fair to analyze it without intangibles, was BRL 8.4 million, and the adjusted profit was BRL 31.6 million. This company is extremely unclear/incomplete. Our EBIT, in millions, was 15% higher compared to last year, despite revenues having grown almost 30%, right? On the right here, as you can see, we have a list of the contracts we secured last year. Here we can already see a little of what happened in 2025, right? You can see that the conversion of contracts in 2024 ended up complicating the 2025 revenue, right? We're turning our attention now to net revenue and gross profit, whereas comparing between the quarters of 2024 and 2025. Unique during this last, in the year 2024, we achieved BRL 420 million. This year, in the last quarter, we had BRL 474 million. So an increase of 12.9%. In net revenue, we had an increase of 26.7%. The difference between having grown revenue by 26% and the gross profit, which I'm talking about here, I always want to think about gross profit. The difference between having grown 26% in revenue and only 13% in gross profit was the drop in margins. With a smaller margin, our gross profit naturally reflected this downturn. Consequently, we lacked sufficient time to make the necessary adjustments to our expenses to compensate for the lower gross margin experienced last year. Nevertheless, I believe that by examining this graph and separating organic and inorganic growth, we see a substantial increase. Profit and revenue had an organic increase of 21.1%, which is quite significant for a company of our size to grow organically 21%. EBIT increased by 15% compared to 2024. Organic growth was 22.5%. Organic growth refers to activities that have been in the company for more than two years. While we have been able to successfully transform acquisitions into organic growth. The EBITDA margin for the fourth quarter of 2024 was 14.3%. This was the peak of the Real Estruturas acquisition. We had just completed a series of assembly projects that triggered more revenue from project completion, where costs had been launched throughout 2024, and this resulted in higher revenue at the end of 2024, and we took the margin to 14.3%. When we look at 2025 now, we arrive at similar absolute numbers, BRL 62 million to BRL 60 million. But obviously, we had a loss of EBITDA margin, mainly due to the drop in gross margin. Net profit in the fourth quarter of 2024 was BRL 21 million. This year was very low. It was a value of BRL 1 million. We had the lowest payments of financial expenses and also amortizations of intangibles. It was really a year where net profit left us quite disappointed, okay? Okay, looking at leverage, remembering that our leverage, we calculated that when there is any anticipation of receivables, the interest is calculated and deducted from EBT. So we reached a value of 2.32 last year. This is the company's focus already underway, and we had actually completed the CapEx in the company's other business units, and it was predominantly the O&G part. Regarding the capital structure, consider the structure quite balanced. Right here, we have a module to begin with, the debt amortization schedule. Our focus this quarter is on achieving a substantial extension of this schedule, and work is already progressing. The new publications will show the extension of these debts with much more ease than you are seeing on the screen. Here is the reconciliation of net debt between one quarter and the other. What is most striking is the acquisitions part of the BRL 247 million that are here. These BRL 247 million are comprised of BRL 96 million, which was the cash portion paid by CMAP, the assumption of debts between sellers and Viademin, and debts from equipment acquisitions of BRL 146 million, plus some price adjustments were higher. Values from previous acquisitions, which amounted to around BRL 5.4 million. So acquisitions are dominant with the acquisition by CMAP, divided between cash and sellers. When we look at the variation in working capital, it was around BRL 4 million. I remember that site from our assembly operations. The remaining units experienced substantial growth. The infrastructure grew almost 23% and A, almost 30%. Our industrial services grew almost 25%, which generated a real increase in working capital. We then concluded the fourth quarter with a net financial position of our BRL 638 million. Now, moving towards the final points, I present this graph here. We have now started showing only compound growth from 2022 onwards, because looking at the years of the pandemic was always a bit doubtful about whether that calculation was worthwhile. So we started calculating growth from 2020 onwards, which was the post-pandemic period. In reading either organic or inorganic receipts, we have seen growth every year. This shows us our responsiveness, the quality of our ability to grow with quality, because this occurred without lost-time accidents. Winning NPS awards, net promoter records, and without accidents, and still being one of the benchmark companies in construction safety. So here I am moving towards the conclusion. I wanted to bring up this point from the first presentation, which was this achievement last year of BRL 2.8 billion. If we look from 2021 onwards, what we announced to you in 2021 was an achievement of BRL 400 million more ROE. We reached BRL 8 billion in 2023. We reached BRL 1 billion in 2024. Last year, as you can see here, revenue fell in 2025. This was the amount we had to execute in the following year, and it fell. Here, at BRL 2.8 billion last year, it is already an indication that the following year, and it is more intense 2026. Let's take a closer look at this number in a little more depth. The orange balls are the achievements, okay? The green balls are the total budgeted for the year. So in 2022, we budgeted BRL 6 billion for the year. In 2023, we budgeted BRL 14 billion. We budgeted BRL 9 billion in 2024, and last year, we budgeted BRL 14 billion. Then there is this light green ball up here, which is what is budgeted BRL 26 billion in February. We see that today market has almost doubled the proposal value compared to the total value last year, right? We would have to add 23 and 25 whole years to reach what we have today in negotiation discussions. In bids, in just two months of work. I want to highlight is that you should observe that in that debt to equity chart that we made, close to 25% of the company capitalization and investment in the mining operations area. This was done in a way to transform the company. Even today, these bids and the prices offered have combination of services that includes infrastructure, geotechnics, structure, recovery, and assembly. This has been very worthwhile. I also want to draw attention to the prominence of the industrial services unit, which many considered a mature unit. I am tired of reading that and all that. It is cool. It has been growing above 20% and grew 25% last year. Furthermore, our inspection unit experienced growth last year, achieving significant expansion and introducing new services during that period. In this part here, I open the questions with the message that it has been very difficult to create a company with this size of services, this quality, and we need more scale. The scale has been coming, but it has come at the cost of leverage. I am sure that from 2026 onwards, the company will deliver good and well and recurring results. Our part in forming, in creating this company is consolidating. Thank you very much. Now we will begin the question and answer session. We kindly ask that you ask all your questions at once, awaiting the company's response. Remember that to ask questions, we recommend sending them via the Q&A icon at the bottom of your screen. By default, your names will be announced so that you can ask your question live. At that moment, a request to activate your microphone will appear on the screen. If you do not want to unmute your microphone live, please write "no microphone" at the end of your question so I can read it aloud. The first question is from Pedro Tineo from Itaú BBA. He asked to unmute his microphone. Good morning. Good morning, Aline. Good morning. Good morning to you. Can you hear me well? Yes. Yes. Perfect. Two questions here, folks. I think the first one, several comments here throughout the release about the expectation you have, right, of recovery here, especially in the assembly area for 2026. I just want to get a second opinion with you, okay? On how this should happen here throughout the year, okay? Just to do a quick comparison, okay? Just so we understand more or less how this recovery is coming. Then, second point, mining operations, right? Semep this year should already contribute quite a bit to your results, just to get a little color. Also on the off-roads side, right, on the off-roads, how they already start to impact here. Your result if we already see this year or next year. I think those are the two main points, folks. Thank you. We will always provide some qualitative data on the business units, but we will, as far as possible, reduce the quantitative aspects of the services and focus more on the qualitative aspects and treating the segment only as offshore mining. But I think that we really must answer your very good question today. We are going to see a ramp-up in the mining operations area already this year. We have the expectation that we might reach, by the end of 2026, a run of the mining operations area of almost double the company that we acquired. I am seeing it, truly seeing the numbers, the tenders, and the accomplishments we are currently achieving. It is very possible that this will happen within this year, that we will have revenues that will be close to double or more than what you saw throughout 2004, 2005 for this company. The assembly area has been able to replenish its backlog. Today, the assembly area also has a little more assembly in the OpEx world, which is plant operation and maintenance in OpEx instead of just exposure to CapEx. I think the bottom, the trough of assembly passed last year. Yeah. At the end of last year, we managed to build a more suitable backlog, and we are seeing the positive results now with a good number of new contracts secured during these first three months. I do not know if there will be enough time for assembly to return to BRL 500 million in revenue, but I think it will return to the BRL 400 million minus something million in revenue this current year. The sum of our other services, such as industrial services and everything else, is going well, as is the infrastructure. Our infrastructure area has also been budgeting projects where the average ticket price is transformational compared to what they previously budgeted. Our average ticket price in geotechnical activities and structural rehabilitation when this company started was around BRL 5 million, BRL 10 million. We started budgeting things at BRL 80 million, BRL 100 million. Today we have budgets of hundreds of millions for services where we previously had smaller ticket prices. Pedro, without going into detail, but already going into detail, we will talk less about segmentation, because the consolidated results will answer whether it will be more in infrastructure or more in construction or much more in mining operations. You will see a consolidated result on the rise, both in revenue and value generation. Can I just add something here? Hey, Pedro. Regarding the off-road equipment, our expectation is to start receiving the first batch at the end of September. Okay. Then we should have some off-road operations this year in the fourth quarter. Okay. Still small, but already in the fourth quarter. We have something coming in for off-road this year. He mentioned off-road, but the internet went down here, Pedro. I did not hear you talking about that part. I understood. You just wanted to know what the unit's expectations are. Is not that right? We bought the first batch. It arrives in September, October, November, December, the last to arrive in January. Julian and I should go to Japan now in May. We are going to install the second batch. The second batch arrives throughout next year as well, from July onwards, and it is a very assertive decision by the company and the company will continue in this off-road direction. That is super clear. Thank you, Túlio. Thank you, Taryn. Next question from João Ramiro from XP. Let us get his microphone open. Good morning, João. Good morning, Aline. Good morning, Túlio. Good morning, Taryn. Well, here on my side are 2 questions. I think this is also a follow-up to Pedro's question about the top line. I think the integrity and inspection segment has also experienced some headwinds throughout 2025, mainly coming from the sugar sector. Some companies, I think, have announced extrajudicial recovery more recently. I wanted to get a little more of your perspective on this segment throughout 2026. What measures are you taking to try to mitigate this somewhat more challenging scenario? Then the other, I think, is the issue of M&A. Over the last few years, we have seen you do M&A that generates a lot of value, right? I think the biggest ones were the Real ones in 2024, and now Semep in 2025. I would like to get a little more of your thinking. Is there room for more throughout 2026? Should you focus more on the integration of Semep? Is that a strategy we can continue to look at over the next few years? Thank you very much, everyone. Okay. Thank you very much. The inspection unit, the unit that fills us with so much pride, is responsible for activities that are very high tech, very advanced for many of us. They develop their own software, the Prinsal System, probably the only one in the world with the features they developed. It's the most complete inspection company in Brazil, a company with seven N3 inspectors, which is the highest level we can have in this category. They've now started developing inspections in subsea MMM and pipelines under the seabed using magnetic methods as well. No, despite the ethanol shakeup from sugarcane, that's not what's going to shake this unit up. They're getting into corn ethanol. They're expanding diversification into other segments. The sugarcane ethanol part, despite the drop in demand due to our bad customer base, has had less activity. They're paying normally. We haven't had any problems receiving payments from that area. This unit, these services, talking more about the service than the units, they've diversified and done what they've always done, innovating all the time. Good. Super clear. If you could also give a brief overview, please. M&A, we still have a pipeline of M&A under analysis. We completed valuations of two companies, one in the infrastructure area, which we like a lot, and another in the inspection area, which we also like a lot. However, considering the focus we just placed on it, our goal is to dramatically reduce this leverage. These things rely entirely on a decrease in our overall leverage. There is also the fact that we currently have a significant organic pipeline that will require more working capital. Leía also demands area, also demands more equipment, some of which can be leased, relieving the demand for CapEx. While other more specific ones, we will have to acquire. So our M&A pipeline is going well. There are others in the valuation phase. My name is A pipeline always has to have a queue because some work out, others don't. We would very much like these to, if leverage allows. Perfect. Super clear. Thank you very much, everyone. The next question is from Samuel Alkum of BTG. Please open his microphone. Good morning, Samuel. Good morning. Good morning, Túlio. Just a follow-up on leverage. How do you see the leverage trajectories over 2026? What level are you looking at the end of the year? Another one will be about Q1. In what way do you see the Q1 situation? Given all this rain, how did it perform on the margins? In the first quarter, Q1, there was a lot of rain with particularly heavy rainfall in Minas Gerais, wouldn't you say? We had a lot of operational interruptions because it's impossible to operate with that intensity of rain. I observe that other companies also suffer during the rainy season, right? We do suffer during the rainy season. I'm not seeing a first quarter. Obviously, every first quarter in the company's history will be worse than the fourth quarter. It will all be worse because of the intensity of the rains. We work with the weather. In the first quarter, we're expecting to maintain our margins comparable or a little higher than what we achieved last year. That's our projection for this initial period. Revenue falls, but we've been able to compensate for that. I've already entered the first quarter with 9%, 7% more revenue. That doesn't happen anymore. We're already talking about entering the first quarter above 12% and trying for more than that. That was much more difficult in the past. First quarter is lower than the fourth quarter, but it's not as bad as it was in the past. We've been able to compensate for that. You also see the strength of diversification. The inspection area is having its best quarter, probably in history because it's working underwater, and there's no problem with rain there. Regarding leverage, we see two scenarios here. The first scenario is with low CMAP growth, and then leverage should, and push should significantly fall below 2x. The 1.8, 1.7. What happens is, we have a lot of mining projects. The probability of us allocating capital, remembering that CMAP is CTRV, right? It needs to call to allocation. We should go back to allocating capital to CMAP, and that will bring more growth, and the leverage will be a little higher than the base that the company should organically have. Therefore, when considering leverage, we aim to stay below a level of 2 times or 2.1. I think, yeah. We can think more or less in that range. My company. Not to talk too far from that. By end of the year, and then you regulate CMAP's growth based on that. Super clear. Thank you. Just remembering one point, we have the option of using funding via leasing for CMAP's growth as well. The balance sheet isn't necessarily a limiting factor for CMAP's growth. We have the option of leasing the machinery and continuing to grow far more strongly at CMAP. I think it's wrong to assume that given leverage by our growth will be limited at CMAP. I don't believe that assumption is accurate. Our pipeline is strong, and we have the capability to simply lease the necessary equipment, allowing us to grow using external capital. We just have to be careful with that. That's a very good point, Dariette. It's not worth considering the limitations of CMAP's capital portion, because the off-road and on-road equipment, the 8x4s, the Scania, and the road equipment, there's the option of leasing. That's not our preferred approach, though that option exists for you to address the growth. Regarding the off-road equipment, despite the first purchase being made, we're not taking on that debt now. This debt should come through the second half of the year. I will pay the cash in 2027. The second purchase, the debt should come throughout 2027, and I should pay the cash in 2028. The company has been doing a good job with its equipment suppliers to, at Chatlos, to extend these payments, allowing the sweat of the equipment, the sweat of your works, to also contribute to the first installments of this equipment dynamic. I brought Taryn up on this point. I see here that there's a question from Juan Pedro Peloya. That's right. Yes. Aksel here. I wanted to see if you could give a little more background regarding off-road at Semep. What return are you seeing, and how will you finance this higher capital? Debt? Leasing? Explain here. Wait a minute. Okay, let's go. What happens with off-road equipment? It's equipment that, as a rule, has a useful life of 30 years. However, it's very difficult, even from an accounting perspective, to depreciate this using this assumption, right? What are we going to do? We're going to depreciate this asset in an accelerated yet conservative way. We're going to depreciate it over seven years. We're going to depreciate the entire asset to 10% of its residual value over seven years. From year seven onwards, we'll have an asset with 10% residual value. From year seven to year 30, it will basically be a business asset light. In years 10 and 20, there's a 15% resale value of the asset's base value, which is to perform a technological revamp of the asset. You replace the tires, you replace the engine, you replace the suspension, you replace all the mechanical parts of the asset, that shell. Because this asset isn't a vehicle, you see, it's like a building, and you replace all the mechanical parts in year 10 and year 20. You do this revamp, and then you depreciate linearly this marginal CapEx that you made from year 10 to year 20, from year 20 to year 30. Then you have very large marginal costs. It's kind of like this unit economics. Later, if you want, you can give us a call. We can go together do economics. We have this very well-modeled now, the calculation of how economics looks, right? The ROIC in the first years, in the first seven years is between 8% and 20%. Then the ROIC becomes quite high because there is very low capital employed, right? Then it becomes a business of practically pure service with low capital employed. Regarding the funding for this, we'll be looking at part equity and part financing from rental companies, right? The rental companies are looking at this business because we believe this business has a lifespan of 30 years. It's an industry that works globally. It's not a business that has a liquid global industry and has existed for a long time. We would be willing to give this residual value to the rental company in year seven. The rental companies are genuinely interested in how this lease and in providing us with a substantial capital buffer. It would make sense to think of a hybrid model where for the first seven years, we could operate with rental capital and from year seven to year 30 with equity. Okay? That would be the unit economics of the off-road business. Remember that to ask questions, we recommend sending them via the Q&A icon at the bottom of your screen. By default, your names will be announced so you can ask your question live. If you don't want to unmute your microphone live, please write "no microphone" at the end of your question so I can read it aloud. If there are no more questions, I think I wanted to ask. Oh, there's one more question. João Saldanha. He has to unmute his microphone. Hi, João. Good morning. Good morning, Aline Rodrigues, Túlio Cintra, Tarine Jung, everyone on the call. Congratulations on the results. The administration's message was quite inspiring. You also announced that starting this 1st quarter, you're going to change the way you report the units, right? I think it will be separated by unit of operation, oligarchies, and the rest, right? What's really interesting, in short, are the sectors where Brazil has a comparative or competitive advantage. I think that regardless of the scenario, I think a great indicator of where the Also in mining, and which will probably also include the operation part. We brought to the company a glue that unites several services that we have within the mining world. The size of these contracts changes, and we now have a continuous flag, a continuous site within Minas Gerais, where we will probably stay until the exhaustion of these mines. The models from now on to input impaired asset, but the results are very good and generate a lot of value in equipment in this allocated capital. This will transform the company's future models. Now, I'd like to conclude our meeting today by saying that we actually succeeded in creating an impressive company inside Brazil to serve the key sectors in which Brazil has competitive advantages. There's one more question from Marcus Soares of Market Makers. He says, "I understand that valuing ROIC of a 30-minus-year vehicle is not an easy task. How comfortable are you with the assumptions of off-road modeling? Does any technological disruption factor into the calculation? No, you can't create a technological disruption if you're going to mine. You have to blast the benches and transport the rock from one place to another. That's not what you're doing with RO for 30 years. You can do it for just 5. If you do it for 5, it will be 20%. If you do it for 10, it will be much higher because the capital intensity will decrease. Regarding liquidity, this is one of the most liquid pieces of equipment on planet Earth. It has a very low price drop. It's very easy to sell this equipment. You have 2 premium sellers in the world, Caterpillar and Komatsu. These are pieces of equipment that are sold at very significant values in the market, and you have worldwide liquidity. You don't need to do the calculation of 30 years, no. You can do it in five if you're already going to like the business. I even wanted to add a point which is the following. This product pays for itself in the first seven-year cycle. Okay. So the economic liability occurs in the first seven years, and then it's upside return. If you want to be conservative and simply kill the project in year seven and it becomes worthless, the project continues to be viable in your model. That's a matter of your modeling, you understand? No problem. It continues to be viable. We are employing an assumption which we believe to be accurate. However, when analyzing economic viability, the first seven years alone justify the project. That's if the residual value is zero, right? In fact, the residual value of a five, seven-year piece of equipment is very high. There are no further questions. We conclude the Q&A session. The video conference on results for the fourth quarter of 2025, the financial year is now closed. The investor relations department is available to answer any further questions. Thank you to all participants, and have a great day.