Good morning and welcome to the ROMI conference call, where the results of the third quarter of 2025 will be discussed. Before proceeding, I would like to clarify that this conference call is exclusively for investors and investment professionals. Any statements that may be made during this conference call regarding the company's business outlook, projections, and operational and financial targets are merely forecasts based on the management's expectations regarding the company's future. These expectations are highly dependent on market conditions and the overall economic performance of the country, as well as the sector and international markets, and are therefore subject to change. Please note that this conference call is being recorded and held in Portuguese with simultaneous translation into English, accompanied by the slides available in the results center of our Investor Relations website at www.romi.com/investors. During the presentation, all participants will be connected in listen-only mode.
We will then begin the Q&A session. To ask a question, enter it along with your name and the name of the company you represent in the Zoom app's Q&A tool. For audio questions, further instructions will be provided later. With us today are Mr. Luiz Cassiano Rosolen, CEO, and Mr. Fábio Taiar, Chief Financial and Investor Relations Officer. They will first present the results for the third quarter of 2025, and will then be available to answer your questions. Now I yield the floor to Mr. Luiz Cassiano Rosolen.
Thank you, Julia. Good morning, ladies and gentlemen. It is a pleasure to be with you again to present ROMI's results for the third quarter of 2025. We closed the quarter with consistent results, reaffirming the resilience of our business model, even in the face of a challenging economic environment.
Net operating revenue reached BRL 349 million, a 31.9% increase compared to the third quarter of 2024. While adjusted EBITDA reached BRL 38 million, a 60.8% increase. Furthermore, we closed the quarter with a consolidated backlog of BRL 895 million. These figures reflect the company's focus on operational efficiency and the diversification of solutions, especially with the strengthening of our machinery rental and B+W businesses. At ROMI Machines, we maintained a solid order backlog and improved profitability, with a 2.4% increase in adjusted operating margin compared to the same quarter of the previous year. The rental business continues to gain relevance, with 57 new machines leased in the quarter, reinforcing the value of this solution for our customers. At B+W, our German operation performance was once again impressive. Net operating revenue reached BRL 99.6 million, with a significant extension in operating margins.
Additionally, we brought in BRL 154 million in new orders in this third quarter of 2025, ending the quarter with an order backlog of BRL 512 million, a 35% increase. These results confirm the success of our strategy of offering customized, highly complex technological solutions aligned with the demands of the global industry. The Cast and Machined Parts Unit continues to face challenges in all segments, but we remain committed to productivity gains and saw positive margin growth compared to the first half of the year. Finally, I would like to express our deep respect and pay tribute to Dr. Romeu Romi, who left us this quarter. His legacy of innovation, ethics, and dedication remains the foundation on which we continue to build the company's future. In short, this quarter reaffirms the strength of our strategy. This is diversification, operational efficiency, a focus on technology, and customer proximity.
We will continue investing in innovation, digitalization, and team development, and we are confident that ROMI's success is directly connected to the success of our customers and business partners. Thank you all for your trust and continued partnership. Now I turn the floor over to Fábio, who will provide details on the quarter's financial results.
Good morning, everyone. Thank you, Cassiano. I would like to start with the highlights. As we have mentioned, our revenues increased approximately 32% compared to the third quarter of 2024. Looking at ROMI Machines isolatedly, our revenues remain at a good level, and an increase came from B+W, who brought in BRL 100 million in revenues this quarter. B+W revenues in 2025 are better distributed across the quarters, although there is still some concentration in the second quarter of the year.
But the third quarter has been showing us better distribution across the third and fourth quarters when compared to the same quarters of 2024. Adjusted EBITDA amounted BRL 38 million, well above our results from the third quarter of 2024, almost 60.1% above. Again, with ROMI Machines, we have been achieving consistent results, and there has been a significant evolution in B+W's evolution in this quarter. Now, in terms of new businesses, we brought in approximately BRL 390 million in new orders, almost 17% above the volume of the third quarter of 2024. There is a high concentration here in B+W orders, which amounted, in this quarter, BRL 154 million. With a sound order entry, we have managed to conclude this quarter in September with approximately BRL 895 million in order backlog, which represents an increase of approximately 18% in comparison to the same period of 2024.
This applies both to ROMI Machines with its sound backlog and B+W's backlog as well. In terms of consolidated operating margin this quarter, we have managed to achieve a significant expansion of 2.4% in comparison to the margin achieved in the third quarter of 2024. Again, the robustness of the ROMI Machines business contributed to this, as well as the B+W results. Now, talking about ROMI Machines specifically, we have concluded this quarter with a sound order backlog which is about 85% above September last year, which means that looking down the road, we still have significant volume of machinery to be delivered to our customers. Adjusted EBITDA was also slightly above the third quarter of 2024, with a sound margin demonstrating that quarter after quarter, we have been able to maintain the delivery of satisfactory operating margins.
For B+W, as we have mentioned earlier, this has been an excellent quarter with new projects amounting to BRL 154 million in order entry. B+W concluded a quarter with a BRL 512 million order backlog, which includes machines to be delivered along 2026, 2027. This shows us that the choice for more complex solutions have given us results, and we have been able to offer alternatives to the industry in order to continue to bring in a large volume of orders each quarter. In terms of performance, B+W's performance was excellent this quarter. BRL 100 million in revenues, operating margins well above what we delivered in the third quarter of 2024, and with excellent perspective for this business unit. Among other highlights, we have created the Sustainability Committee in 2025, which is closely aligned to the company's philosophy and sustainability actions.
We have also participated during the last week of September in one of the most traditional expos in Hannover, which is the EMO Hannover in Germany. We participated both as ROMI and B+W with both brands, and this has been very fruitful. This is also an expo where we have an opportunity to be in touch with the most recent technology, and it is very important to us to be present, especially when it comes to internationalization. Also in this third quarter, we have been able to distribute BRL 16.8 million of interest on capital. Now, moving to conjunctural indicators, what we see both in terms of GDP and industrial product and gross fixed capital formation, we still see an evolution when compared to the same period of last year. However, we can observe a deceleration towards the end.
Looking at the next slide, we see the average installed capacity utilization that has been on a descent. This is something we feel from the customers that although activity levels are still quite satisfactory, the outlook is for a reduction of the utilization of installed capacity. This is something we observed in the past couple of months, but we have been already perceiving for some time a lack of confidence amongst industrial entrepreneurs when it comes to new investments. We have been seeking alternatives, whether through machine rental and also by selling used machines that are returned to us after the lease period. They still have a lot of acceptance in the market, so in a way, we have been able to achieve a decent sales volume considering the challenging macroeconomic landscape. However, more recently, we see the environment deteriorating in the past couple of months.
Talking about the demand for our Rough and Machined Cast Iron Parts, as we can see, ROMI Machines are still widely used across the manufacturing industry, especially. We see machines and equipment that are used within a wide range of industries, as well as service providers who work at different industries as well, representing half the sales of our machines, which is compatible to our history due to the type of machine that we manufacture. Looking at B+W Machines, there is some concentration because we are talking about larger projects. With a highlight to aerospace, which is an industry we have been working on developing solutions applied in aerospace, and this has been an industry with good performance worldwide. Now, for Rough and Machined Cast Iron Parts, automotive share has been reducing, especially with trucks manufacturing facing a retraction. When it comes to civil construction, we see stability.
In agricultural machinery, we have a slight growth, but the growth is stable. In wind power, we are still moving at a slow pace. Now, in thinking about net sales per business unit, with this substantial increment in revenues, at B+W in the first nine months of 2025, in comparison to the first nine months of 2024, we see B+W has gained a lot of participation, moving from 11% to 25% of consolidated revenues. Because ROMI Machines is basically stable, its participation ended up being diluted by the B+W growth. So ROMI Machines represented 72% of revenues in 2024, but it represented 60% in the first nine months of 2025.
Now, as to sales distribution, again, because B+W was the unit that made the most progress in terms of revenue during this period, this is a market external to Brazil. Brazil ended up reducing its share, whereas Asia increased its share as B+W has a consolidated presence in Asian countries, especially in China and also in Europe, which is where B+W is located and has a consolidated market as well. Now, as to the U.S., the share is constant. We have both ROMI exports to the U.S. as well as B+W exports to the U.S. We have products that are manufactured in Germany and sold in the U.S. And lastly, Latin America remains basically stable in this comparison period. As to the order entry and backlog, we see some deceleration in ROMI Machines. There has been a decrease of 30% in order entry for ROMI Machines.
This decrease is 100% represented by the domestic market, since we have been making progress in the foreign market. However, it is still a small growth to make up for the losses in the domestic market. However, we still have had a decent amount of order entry, which you will see allowed us to conclude the quarter with a sound backlog. As we mentioned earlier, B+W has experienced a very good quarter in terms of order entry. And also in the year to date, we see B+W performing quite well. And this has been allowing its backlog to increase in spite of revenues increasing quarter after quarter, which will give us results over the next years. In Rough and Machined Cast Iron Parts, we have experienced a growth of 35.5%.
We have received the first order from the energy and power industry, but basically in trucks and agricultural machines, activity level is still quite moderate. So in total, we have achieved BRL 388 million in new orders. An increase in comparison to the same quarter of 2024, where B+W has had a great share. In the year to date, in 2025, we are well above 2024, except for ROMI Machines, but we saw growth in B+W Machines and Rough and Machined Cast Iron Parts. Now with this order backlog, we have concluded September 18% above September 2024. It is a backlog that is well above June 2025, and this is a sound backlog as we have lots of machines to deliver still. And B+W will give us a backlog for up to 2027, that is 30% above our quarter last year.
And in Rough and Machined Cast Iron Parts, this has been the most challenging area in the past few years, especially due to the retraction in the wind power industry. The total order backlog was concluded with BRL 895 million, which also represents an 18% increase in comparison to the same quarter last year. Now moving to margins and profitability. Looking at the quarters between 2024 and 2025, we see a decrease, but there are several aspects to be considered. First, we have a different mix of revenues in this quarter of 2025. That is, B+W's presence has increased, and even though it has increased its performance as well, its gross margin is below the gross margin obtained with ROMI Machines, and this impacts revenues.
There's been a reduction in gross margin for ROMI Machines in the third quarter in particular, and this is quite concentrated due to the mix of products. Exports have suffered to some extent due to the depreciation of the dollar in comparison to the real. In terms of profit, we can observe an increase in gross profit here and operating expenses were well under control. This allows us to observe these results in operating profit and margin. That's had a positive impact on EBITDA. In this quarter, we've delivered BRL 20.5 million, and the margin has been evolving from 3.4% to 5.8%. In the same way, we could observe in EBITDA. EBITDA went from BRL 23.6 million to BRL 38 million, and the margin evolved from 8.9% to 10.9% in EBITDA for this third quarter of 2025.
This has allowed us to obtain an evolution in net income, moving to BRL 27 million. That's the double of the same quarter in 2024. The margin has evolved from 5.1% to 7.9% when we look at this quarter of 2025. In terms of business units results, ROMI Machines results are basically stable. In the year-to-date evolution, we see an increase in gross margin, and this is very consistent. There are aspects to our rental machines as it has been gaining share within the company. This has been helping us maintaining operating efficiency and maintaining representativeness and the revenues with satisfactory margins. With similar volume and evolution and gross margin also in 2025, we've made progress achieving 2.5% more margin in EBITDA.
Even though the margin has not been growing in terms of revenues volume, we've been achieving good operating margins with the orders we have. For B+W, we can observe a substantial increase in revenues throughout the volume of order entry it has been bringing us over the past few years. In 2025, like I said, the revenues are better distributed across the quarters. Of course, this is closely connected to operating efficiency and cash flow management. We have more liquidity than we had in the same period of last year, and this has been allowing us to extend margins, first, gross margin. Gross margin led from 8.6% to almost 16%, and this has allowed us to, in the first nine months of the year, obtain an EBITDA breakeven.
With good perspective of order backlog, we still have projects to deliver in the last quarter of this year. For Rough and Machined Cast Iron Parts, this is the most challenging area of the company as we've mentioned earlier. Revenues are virtually stable at a low volume and with regard to the actual business unit capacity. This poses a series of challenges, for example, reduction of fixed costs and reorganization. Looking at the results for these nine months, we see a very challenging landscape, well below the history obtained in this unit. Based on the backlog, we are looking at a challenging future as well, but we have been taking action to increase performance. The activity level is still quite challenging due to the environment when it comes to Rough and Machined Cast Iron Parts.
Now, for net indebtedness, we have BRL 149 million in net debt. There has been consumption of cash, but when looking at the behavior of cash flow, it has been improving and the idea is to deallocate cash flow so that it returns to improve the level of net indebtedness. However, debt levels are quite balanced, and we are completely covered for our dues. This quarter, we have captured more funds to sustain the growth in the foreign market. However, we are still observing sound results in terms of liquidity. In terms of capital market performance, our performance has been below Ibovespa. This is obviously an industry that is more subject to cycles, more sensitive to macroeconomic environment that we have been experiencing in the last few years. This has also been impacting the company's performance and consequently the performance of our shares.
With this, we conclude the presentation of financial results in the third quarter of 2025, and I would like to thank you very much for your attention and we remain available to address any questions you might have. Thank you very much.
Ladies and gentlemen, we will now begin the Q&A session. Please note that this conference call is exclusively for investors and investment professionals. To ask a question, type it along with your name and the name of the company you represent in the Zoom app's Q&A tool. For audio questions, use the raise hand tool to open your microphone and then identify yourself.
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We have the first question. It is actually two questions.
I am going to read the first, address it, and then I will continue to the second part. The question comes from Antônio Fonseca, from LFX Capital. Thank you very much for your question, Antônio. To address the first part, he says: "Good morning. What concerned me the most in the results was the 30% drop in order entry for ROMI Machines. Is this due to the drop in rented machines or to the market scenario? What is the outlook for this year of elections, with reduced demand and increased indebtedness, in spite of the dollar losing value faced real?"
Well, basically, Antônio, we see the entrepreneurs' confidence level being reduced. This causes investment levels in the country to be reduced as well. People hold back before making a decision to invest, and this has caused the market to cool down.
When it comes to machine rental, we've achieved significant results in the second quarter, and the third quarter is still consistent, and machine rented results are good. We have not had any returning of rented machines in the third quarter. It's basically a reduction in order entry and sales. Now, the perspective for this year of elections. For 2026, it's hard to anticipate. ROMI always works with large capacity to react. If we're having a good year, we have to react quickly and seize the moment, like it happened during the pandemic. We acted quickly and returned quickly. If there is a reduction in investors' appetite, operationally speaking, we must be in very good shape, maintaining the margins and sprint through this period. We always work with this capacity to react, whether we're growing or not. It is a year where interest rates shall remain at high levels.
At least that's the forecast for the first half of next year, and high interest rates inhibit investments. Like you said, the depreciation of the dollar in comparison to the real increases competition for ROMI. This year and next year, we see the appreciation of real. If entrepreneurs' confidence levels are relatively low, then we should probably experience a year similar to this semester. Now, as to the second question, B+W had very different results and revenues this quarter is regarding the orders. Well, talking about B+W, these machines were sold late last year or during the second half of last year. B+W is a company that manufactures high engineering and high complexity machines, so they're always large projects. When the project is slightly smaller, the deadline could be 10 -1 2 months for delivery.
When it's a larger project, this period could extend to 14, 15, up to 16 months. This is how B+W works dynamically. B+W has been attracting new orders, and the backlog at B+W, over 15% of it should be delivered still within this year. A substantial part of it will be delivered throughout 2026, and around 20% of this backlog will only be delivered up to 2027. We don't have long deadlines for delivery affecting B+W opportunities. The 2027 projects are clients who are making investment in infrastructure, and they also desire to receive the deliverables in 2027. B+W continues to work hard to meet the customer's demands and desire to have the machines delivered at this period. But like I always say, we should look at B+W as the full year.
Next quarter, when we conclude the quarter, this will give us a better understanding of B+W's performance in comparison to 2024. For 2026, we have a sound order backlog for B+W. This is ROMI as a whole. Sometimes ROMI Machines suffer a little bit, but B+W brings in great things, and sometimes it's the opposite. We have this mix across the three units, and that helps us achieving this consistency and solidity in the past few years in our results. Thank you, Antônio.
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Excuse me. If you have any questions, please type them along with your name and the name of the company you represent in the Q&A tool of the Zoom app.
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Excuse me. Since there are no further questions, I would like to turn the floor over to Mr. Luiz Cassiano Rosolen for his closing remarks. Please note that ROMI's Investor Relations Department is available to answer any further questions. Mr. Rosolen, the floor is yours.
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Well, thank you very much for participating in ROMI's third quarter earnings conference call. We remain at your avail throughout the next quarter to address any questions you might have. Our next call will be on February 4th after disclosing the results for 2025. I wish you an excellent rest of your day. Thank you very much.
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The ROMI conference call is now concluded. Thank you all for your participation. Have a good day.