Welcome to the video conference of the results of the fourth quarter of Vittia. This video conference is being recorded, and the replay can be accessed on the site of the company, where the presentation will be available for download. We inform that all the participants will be only watching the video conference during the presentation. After, we are going to go to the Q&A, and further instructions will be provided. Before we continue, I would just like to reinforce that the declarations is based on what Vittia administration believes and the updated information to the company. This declaration can involve risks and uncertainties that has to do with the future events, so it depends on circumstances that can or cannot happen. Investors, journalists, they should take in consideration on the ambience, on the environment, the results can be materially different from those expressed here on the declarations.
They are present here in the conference, Mr. Wilson Romanini, CEO, Alexandre Del Nero, CFO and Director, and Edgar Zanotto, Director of Innovation and New Business. I would like to give the floor to Mr. Romanini, then I will start the presentation.
Thank you very much, Luis. First of all, good morning. I would like to start telling you guys we live in a very complicated period in agro, Brazil as a whole. When Vittia comes here to do this presentation, it shows that and how to work in these difficult markets. Of course, that we would like to show better things, better results, but we are going to show you guys, it reflects a lot the period that Brazil is going through and the responsibility that our company has in these moments that are a bit harsher environments. We had some interesting numbers. Cash flow of BRL 110 million, basically 70% better than we had in 2024. We had a little growth in revenue. Of course, the market is a little bit more complicated.
They tend to consume products that has less of a value, but we were able to increment in 4.2% our growth related to 2024. They are searching alternatives now because of the markets who have results in their operations. We try to go under the fertilizers, soil fertilizers. Vittia is a company that has a very wide portfolio. It understand that and did a work, a very interesting work in this line of growth of 43.2% in the growth of soil fertilizers. Our debts fell going to 2024, 13.4%. It shows that the rationale that we are doing here inside the net debt, understand that the market is a bit more difficult. I think we are doing a very good work internally inside the company. We had a fall on EBITDA. It was adjusted because of the market itself. It was a leverage, very low leverage.
That is even though that is still a very triumph of the company, even though all the matters related to payments, JCP, and we bought some company stocks because we believe in our business, and it is a business very interesting, too, also. It is a Vittia México. It is starting the commercialization now and with a very interesting potential this year. We do not stop here to look for alternatives to have someone to always keep the company healthy. Can go for the next slide, please. Talking about the markets, our performance, we work in a rationale that is very robust, trying to understand the market now. I spoke before here about the development, about the soil fertilizer. We are very disciplined in that. It is our DNA.
Like I said, we understand that inside the company, we are able to bring results, even though having a discipline very big and these expenses, we are able to have an increment of revenue. We did a strong cash flow generation, strong operating. It is the quality customer portfolio and efficient credit policy. We talk about our risks and opportunities. It is the current scenario. You know how it is now. I told about in a previous presentation that it did not exist, a light at the end of the tunnel. This tunnel is still very dark indeed, but we are able to go, to cross this tunnel in a very interesting way. You guys are seeing the market, generally speaking, a lot of people that they are fighting inside this tunnel, that they are having a hard time.
So when we speak about our supply chain inputs, there is a rationale by the agriculture and our understanding, we have for this year, 2026, from three to four products that we are going to be launching in 2026. Vittia's positioning, we continue with this operational discipline. Like I spoken before, when it comes to R&D, it is very focused. We are going to bring some of the years, the disruptive things inside the market. One of our greatest assets, I think it is this complete portfolio, so when you go through moments that are a bit more harsh or complex, you have the opportunity to establish a very well fair game. We also complete 55 years. Vittia celebrates 55 years of work. Along these 55 years of promoting and development of the Brazilian agrobusiness, and now we are expanding to other countries.
This is what I wanted to tell you guys, to let you know. Now, I give the floor to Alexandre Frizzo.
Thank you, Wilson. Good morning to all. Now going a bit into the detail of the performance. Like mentioned previously by Wilson, we had an extraordinary performance on the soil fertilizers, and also followed by the growth of foliar fertilizers. I attribute to three factors. The first of all, it was the only line that we had increments of price, because it is a line that it is a low value. It is a line where we can pass some price. It is based on minerals. It happened last year. Beyond that, there was no retraction of demand in the line whatsoever. Even though it is considered a cheap line for you to apply micronutrients, and at last, we had a very strong position in cost. That is very competitive in a way that we gain market share.
In the lines when it comes to foliar fertilizers and industrial products, story was a bit different. We saw a retraction of the demand. That is very much because of these moments of the farmer, that it is looking to make some savings and to reduce risk and to reduce the intensity of this kind of product. So when it comes to biological and natural solutions, we did not see a retraction. We did not analyze on the demand. We saw a demand that was solid, but we saw a high level of competitiveness in this segment. I have been saying a lot related to this subject specifically. We had a lot of new players in the market and old players that got out of the market. It is not growing the market in this sector that we are expecting. It did not retract.
It grew a very little bit, but the amount of investment that is part of the sector, we had a very competitive market. That resulted in a certain difficulty to pricify. We did not see the drop of prices that we watched the last couple of years, but we saw a stability or a small drop. The inflation, of course, is natural in Brazil. We have a logistic that was higher cost and then labor. That brought a scenario that is a bit harder for this line specifically. Now, going to the next slide. Inside this dynamic, complementing this vision, we had a drop of consolidated gross profit. It is a matter of mix. For example, the soil fertilizer, it acted very well in terms of revenue. It had a bigger weight into the mix, and it had a smaller margin compared to the other lines.
Even though it recovered the margin in the trimester and in the whole year itself, this margin recovery has to do with the rationality that we have been doing on operation of organic and mineral, where we were having success of losses, and now we are able, as you can see on the fourth quarter, to change a bit the figure, to go from a loss in 2024, to a scenario of gain and profits in 2025, and in the year itself, a greater margin profit. We had a performance of increments of margin for more of internal moments because of the more of internal things, because of external things on the lines.
When it comes to biological natural solutions, where we had this matter of restructuring, we suffered a bit, this dynamic of the market that we have a difficulty to pass this price that we are dealing with. There is a couple of price drops that we were able to have a margin compression in the biological solution, natural ones, and foliar fertilizer and industrial products. That was also the case. Now going to the next slide. Talk about our SG&A. We talk about a lot, that is the part where we control, and we are able to be within our expectancy to have a growth between zero and the inflation of the period, so we have a real reduction of expenses in the company. That is our strategic orientation since 2023. Understanding the market scenario and to look for efficiency and rationality of all the processes of the company.
We have been happy in this strategy and a way to protect our results, but without destroying the pillars that we have for future growth of the company. We understand that this market has a lot of perspective for medium term, going lasting a bit less, a little bit more than people waited, but in some moments, we will have this taken over again, our projects, they are still preserved for future growth. It is worth saying that this year we had two events that was extraordinary. One that I talked already about in the previous quarter was the mobilization of the facility in Patos de Minas that generated a BRL 15.6 million. It is an expense. That is no longer we are having. There are investments that are supposed to have a drop during the year.
On the other side, we have a recovery from tributes recognized on the fourth quarter. This environment of constant changes in regulatory implementation taxes, we did a strong work to bring opportunities and changes that happened in these last couple of years that we were able to recover from the past. That brought up a value very important for the year, BRL 24.2 million, that contributed to the results, but we understand it's extraordinary revenue. That's something that's maybe not going to happen the next couple of years. Looking at this adjusted EBITDA on this extraordinary event, we had a drop. EBITDA was reported, the ones that was just reported. We didn't have this drop on this magnitude, but this is an operational mirror in 2025 with a drop of 13.6%, caused mainly by our loss of gross margin profit.
Margin EBITDA, a drop 2.9 points beyond 14.1%, from 16.9%- 14.1%. This is the margin that is the lowest that we've had the company since we started to do this control auditing from EBITDA. From the company, it reflects a bit the moment that we're living in the market right now. I said at the end of the year, I mentioned it's a low margin, but it's still a positive margin. It's a period of the cycle, low cycle now. Vittia has a greater value than our products that ahead next couple of years, but that the last years, now we work with compressed margins and formally related to profits on the current scenario. CapEx, we kept the same strategy to look for investments and efficiency in our biological factory.
You're only having one investment of greater relevance, which it was in the factory and to launch the Triunfe that was launched last year for investments that is BRL 6.3 million. The CapEx was very close to 2024, BRL 33.2 million, 1.7% growth compared to 2024. When it comes to cash flow management, we have a positive year. Given all the search for efficiency in the company, we were able to generate BRL 110.5 million in 2025 on the operating activities, and the rationality has to do from the operation for soil fertilizer and again, mineral, where we're able to unify inside a facility to reduce stock. The high activity that we had in the soil fertilizer work with a medium to receive these dividends better than the previous years.
We've been keeping the good performance in a point of view of receivables and keeping it low without a greater growth year. It's been a hard work of efficiency and search. Always keep this financial discipline, when markets are good or bad, we got to keep this mindset. We're able to, in 2025, reduce our dividends. That was a very interesting performance for a hard year, and we kept a level of leverage similar to 2024, to the level of 1.1 x the EBITDA adjusted throughout the year, considering that EBITDA fell. The company is very healthy with a very good control leverage. All the capacity going through this hard period, and as I mentioned, to recuperate, to recover from the markets that will happen in a short period of time in the future.
When it comes to financial results, taxes and adjusted net income, compared to last year, it wasn't such a good result. The interest here was a little bit greater here. When it comes to income tax and social contribution, we were a bit more efficient compared 2024 because of the higher JCP and efficiency of our program to search of the law and the goods, and related to our development team. As a result, all the shares in the semester have been doing. The adjusted net profit and net margin, it was a drop of margin. But due to the current scenario, we see this as a positive thing, because we still have profit at the end of the year, of course, not as we would like to, but the company is healthy. It closed the year with BRL 60 million of profit, BRL 60.2 million of liquid profit adjustable.
The reported will be bigger because the effect that we had from the fiscal recovery. We are the worst years of the market wise, where we have companies that are going through insolvency or judicial bankrupt procedures, so we're still having profit. This is a very important point, that it makes us to understand that we're going through this period and we're going to have better years ahead of us. Now it's Edgar's time to give us this vision of innovation.
Thank you, Frizzo. Good morning to all. Going to speak a bit about innovation. We're keeping all the responsibility. We're still investing strong in our future to keep growing. You guys will notice that we have this expectation with Triunfe. That was the launching that we had in this year, in 2025, and start to have the results inside consultancy, producers, when we're seeing beyond to having a better control to have the products in the market. It's bringing a gain of productivity. So we understand that we're going to have a greater growth. That's why we have investment, CapEx investments in the factory. We have a launching forecast to three to four products in 2026. I believe two will be biological ones, that we're going to have some different things in the market. Can you go to the next slide?
On the investments, as I said, we see we were keeping our OpEx, CapEx because we had some constructions. We were building the lab, the research center. But when we talk about OpEx and work and on a daily basis, we haven't cut any projects of R&D. Some projects are greater now, some things are reaching an end. So we're going to keep on this rhythm of growth and to be ahead of the market when it comes to innovation. So we have some things, some new registry, these launches that we're going to have, the registration. We're going to keep the work in Vittia México. We understand that this will be a very good year in Vittia México. Last year, we started working on the market development and start to put some products into the client's hands.
Now we started the sales, and we realized that the sales, they are accepted better than we expected. So we're able to fulfill our plans there. That's what I wanted to say. Frizzo, go ahead.
When it comes to stock markets, we have the buyback program. We did the same work in 2025, keeping our strategy, take advantage gradually the opportunities, opening the fifth program of buyback, that is still the fifth share buyback program. We are going to keep that strategy to keep the level of buyback program, to understand that the price, it is off the real value, the real price. We know that we are in hard times now, not only the agrobusiness, but the capital market, and also Brazilian capital market. It makes us to have this differential, which is very different and related to price. Now, Vittia, we say that it is below the fiscal year as the auditing year. We have a relevant price into the factory inside our accounting, which is by the cost that it was in 2020.
For the price of the cost of construction that we are below our liquid inventory. Of course, we have a low cycle now, and things are going back little by little. The private market, any transactions that was announced in the last couple of times, that it was values that was much higher than negotiated, what Vittia is now being negotiated. So this is our strategy, but always in our way, in a conservative way, and gradually, we are always taking the cash and then to keep our health financial. Also highlight, even though all the scenario, we are returning the resources to the shareholders or paying through JCP. BRL 33.8 million were paid as JCP. This is something very relevant in our financial solidity.
Even though all the scenario was able to pay BRL 50 million of return through the shareholders, through the buyback program or JCP, and we reduced our nominal value. This part we need to highlight in this current scenario, like I mentioned before. We know that the majority of the players, they were not able to deliver this kind of performance, not on the operational part and/or financial parts, even though that we are not where we want to be and comparing to the potential that we know that we are capable of.
So we are going to start a Q&A for investors and analysts. If you wish to question, just click on the button, raise your hand, and on the button Q&A below the chat line. Our first question comes from Pedro Gama, analyst from sell-side , from Citi.
Hello, everyone. Good morning. Related to questions, I would like to congratulate you for the results given the current scenario. But the derivatives and the fertilizer, petroleum, and logistics, how do you guys see the impact of the conflict of the business of Vittia and the Brazilian products? It seems like the Brazilian products, they are going to upside for a potential of the greater agricultural product, given the greater price of the cost from this fuel that it is already blocked. How do you guys see that? My second question is, given the sales delay that I have seen in the end of 2025 and delay of the planting of soy, do you think some sales that were allocated to the next trimester, the next quarter, if that is true, will we wait for a greater volume for this first quarter?
Pedro, I will say, and then Frizzo can complement. Related to, let us say, first of this delay on the fourth quarter of 2024, sorry, 2025. So it's not going to be this increment. It's not going to be this growth that is really something to take into consideration because we're observing the market. We have a proxy that's left discipline. Everyone is looking for this discipline. So it won't happen in a way. It will happen in a normal way. There was no delay, actually. Now that the producer, the farmer, is rationalizing to put some things to make it viable, the operation, his operation. In relation to the war and everything, oil prices, it's premature to speak about it because every day we listen to something different. I know the war is over, the war is not over. So right now there is the pressure, natural pressure.
We see this in an oil, fuel. Today, I was talking about a consultant related to the war effects, 10 more than two months, and this will compromise the matters of the macronutrients. So it's premature in a way. Now we don't have a vision, a clear vision, related to this war. Momentarily, there was pressure, cost pressure, but I don't know if that. I don't know, how can I say it? Or if this will keep stretching that much. Whether you want it or not, when you have these external pressures related to cost, it will impact, of course, the cost to the farmer, to the producer. Now we have the biological products and then the capacity, the phosphorus, you have the nitrogenated ones. When you talk about soy, the index is zero. When you do all the application effectively with a nodules, that is the fixation, biological fixations.
Everything that we're going to speak will be something that is just a pure guess. So that's what I think.
Okay. That was clear. Thank you.
I think you answered everything. I think I don't have much to add, actually, to be honest.
Our next question comes from Pedro Fonseca, analyst from XP.
Good morning, Wilson, Frizzo, Edgar. Thank you to give us this opportunity to question. The first one is related to mix. We've seen this change, a little bit of mix throughout the year, but the performance, very positive. I'd like you to update how is the mix culture of the company after 2025, and what's ahead for 2026. We've been talking about opportunities and oranges and other cultures, but soy was always the horse of the scale. As you get your guys' vision, what do you see as opportunities of the other kind of cultures in 2026? The second point, I'd like to get an update with you guys. You guys come from a competitive scenario. Frizzo, in his opening, he said about a lot of players that are going in and no one getting out.
What you guys are foreseeing in the horizon, something that can change the competitive scenario. That's the other of my questions. Thank you.
Okay, Pedro, talk about the mix, talk about culture. Vittia, it does already work for a while already, but there are crops. You have to understand something, that a crop that from the moment, it's the sugarcane, for example, that's having a boom now in the last couple of years. Last time, there was a drop of the price of sugar. Sugarcane, for example, it's not on the golden years. This rule can be reverted. The oranges itself, which is a crop that it's very satisfactory. It doesn't live on the best years, these crops, the last couple of crops. It's not so much the golden years. The coffee crops also, this culture is reaching a position that it's very comfortable with good prices, and Vittia does this work. With the work that we're doing, even very intense, it's to access these markets independently from the culture.
It doesn't matter the kind of crop. We understand that we have a potential to produce. We have the supply, there was strong rationality, rationalization with costs, very interesting costs, and Vittia, that doesn't stop. That thing, it's work. You don't build this kind of work from day to night. It worked through time. But we're doing this. You can be absolutely sure about it, that's one of the greatest works that we do here in our company. When we talk about competitiveness, like Frizzo mentioned, there was this moment of expectation in the biological world, disruptive technology, that it's getting bigger and bigger, the market and euphoric with all these things inside the market, people going in. Some players that had expectation that had a greater expectation, and that's not the current scenario.
We know that we have inside our market companies and situation that are in a very hard situation now, delicate situation. I think the euphoria is over, and from now on, things will be a bit different in this way. That's our expectation. If you want to add something, Frizzo and Edgar.
I think that it's what you said, it's natural for us to have a ripening of the market. There is space for a lot of people in this biological market, but there is not a space for everyone. Competition will have to mature, and will have to be competition that'll be focused on quality, innovation, and this is our strategic positioning and directing. The market won't change that much. The players will change, and of course, in a couple of years, and Vittia will still be there. We don't know who are the players that will stay, but we know that we'll have different players.
We'll have reconsolidation of the current players, some of the established companies through M&A of these players that are less efficiency or financial difficulties, or we're going to have these players just walking out through financial ways that are just going bankrupt of credits, related to credit. It happened in other markets already. I do a parallel with e-commerce. There was a time at the beginning of e-commerce, there was this euphoria, and everyone got into e-commerce, and it's naturally to have a ripening, and then the most efficient players will stay at the end. That's what we believe. It's not going to be a process, a short-term process, but it'll be a process that is initiated already. There's no attractiveness to go into the market of biologicals.
Like I said, Vittia, which is a company that has over 50 years working with biologicals and a portfolio, industrial scalability, and we will stabilize our net worth. We closed with ROI below 10% of a facility that's outdated. Imagine you're going to put up plants today with the current prices to build their plants. There are people that they invested BRL 100 million, they're now able to sell BRL 70 million worth. On the last line, this financing, they are not able to stay on the green side. Now I understand it is not attractive going to this market currently. Now we are going to have this process, natural process, the return, the most efficient ones will be in a common line with a capital cost and risk. It is not something easy, of course, it demands investment.
What I say is, I have been speaking a lot about it, exist, this entrance barrier to build plants. Not to build plants. Build plants, anyone can build a plant. For example, if you have the money, you can build a plant, a biological plant. Now, to have a complete portfolio with different technologies, to have access to the markets and to access to the market with an interesting cost, because it is not only about having 50% margin profit, and if you spend 40%. You need to have an interesting cost and to have R&D to keep with the technologies that are more advanced today. To have everything, it is hard.
When I say that there are few companies that have what we have today, the problem is it was sold in a way that, consequence by people, by some, that to keep in the market, just buy some fermenters and buy a plant, a facility. Now we have different plants, biological plants. We have more biological plants than demand in Brazil. That is a fact.
Okay, thank you very much.
Okay, the answer is very complete.
Our third question comes from Mr. Bruno Tomazetto from Itaú BBA, analyst.
Hello, guys. How are you guys doing? Just to follow quick, follow up on this perception of the culture, these developments to evolving with the time, it is very clear. But given that the operational side, that the financial part, I take it is valid to show here that we do this breakage of what is the open of margin that this market that did a little bit well in the last couple of years related to soy. Maybe there is a fee, a relevant CF growth that shows a company growing, but towards market, these are the margin on these markets that have been performing a little bit better the last couple of years. Something quick here on discussion on SG&A, but 2023, 2024 been performing well. This focus agenda of efficiency and reduction, but the marginal movement is a little bit more harder.
To just a bit harder, I would like to know if it is more efficient to grow in 2026 or from now on, we can think about a growth that is more normalized. That is what I would like to say. Thank you.
Frizzo, you want to speak a bit about it?
About the SG&A. We are always looking for this search for this efficiency. The last couple of years, we are looking for some opportunities, more obvious, reminding that we had the euphoria into the market in 2024 with accelerated growth. When that happens, we know that the growth is not the most efficient way. Everyone is growing too fast, and sometimes they are not so efficient in a way of a structure and expenses. We did that already. Let us say, let us put it that way. This cut related to efficiency, we did already. We were doing it. Nowadays, we have a structure that is very adequate, but looking for more efficiency.
Even doing all this, we have a greater structure that will allow us to grow, because the cuts, like you said, it's in looking for efficiency, things that was done or created inside of this growth period that weren't generating and weren't going to generate any kind of revenue. The cycles, that's how it goes. On this point of view, I believe we're very balanced in that way. We don't have a vision to significant change this forecast and on the current scenario. Maybe if things change, who knows? A recovery on the markets or maybe tougher markets. Now it's a different story, and we're going to reevaluate. About the cultures that he asked, we don't have this data specifically, like an objective way to separate culture. Even if we had, we were going to keep it open to the public, to the markets.
We don't use this strategy of access. We don't see this as a good strategy. We see it as a confidential strategy at the margin in these sectors. What we can say that we've been saying is, the cultures that we've been focusing, it's sugarcane, coffee, the [NHT]. And they have superior results in the grain in these last couple of years.
Exactly. Excellent. Thank you very much. It's very clear.
Yes, thank you.
If you're minded to ask, just click on the icon to raise your hand, or just click on the button Q&A below. Our next questions come from [Marcos Gemello and Pedro Vinicius], analysts buy- side from Nexus.
What can we wait for the behavior of the volume of sales and then gross margin profit in 2026? Can you give us a vision of line of business in the factories and the plants?
Starting to Wilson and Edgar, you guys can complement later. We had a market that we had a small growth in 2025. We didn't grow necessarily from 2025 to 2026, so we expect a small growth, but we wait to growth, we expect this growth a little bit tiny. We have strategies for that, not so much. Like I stated, the competition level already established. We had a couple of players that got into the business in the last 12 months. Now we see that the situation is a bit stronger now that the companies are fragilized, are weak, and some companies are having problems to keep this competitiveness. So our expectation is to get a greater market share, but we're going to at least keep this brute margin, gross margin. We wait a stabilization of the gross margin.
We waited in 2025 already, and that didn't happen. But we hope that in 2026, we have a stability of margin growth. We don't expect an expressive recovery of price or margin. 2026, we're in a scenario of growth, and we understand that this matter of this nature of Vittia to be very well-structured, to be strong financially, is starting to make the difference now on day-to-day. Now, about we have plants that sometimes they are still, like I mentioned, what I say. That's something that we're looking upon. We're looking to efficiency. We had to double our volume, double the capacity of biologicals with the solution that we have today. Our production capacity are a lot greater. With the cost production, we need to lower to be more competitive on the market, we need to lower the price by units. I know Wilson, if you want to?
No, no, that is the vision of 2026, but I think that is it. The Vision 2026 will be day-to-day basis. Beyond that, the agro, the war has just started. The agro, there is all this expectation, one of the greatest factor, whatever expectation the market assume, the grains, the demand will be less, the offers will be well diffused in the sector, and now the perspective that we can anticipate 2026, I do not know, it is not the best scenario yet, can anticipate that we have related to problems of crops in the U.S. Can we? Okay. But we also. It can go only for 2027 or 2028. So we are in a scenario of a lot of certainty, and it is hard for us to give a proper forecast.
We have just been working, doing what we are doing to be just focused on being prepared with these different scenarios. On the scenario of recovery that exists, like I said, there are scenarios that the market can start recovering in 2026 or 2027, but the scenario can be also, at the same time, it can be harder in a short period of time, in a short term. In a medium term, we have this trust in the markets that we will have a recovery, important recovery, by this simple motive. The grain offers will be strict because the demand kept growing and growing.
The Q&A are over now. Just going to give the final considerations of the company to Mr. Wilson.
What I have to tell you guys is, of course, the challenge is big, but we are doing what we need to do. What we need to do, we need to really. Let us see if I. Okay, I am on audio. Just double-check. Like I said, we got a great challenge ahead of us, but we have a time, experience, 50 years of company, 50 + years. We believe in agro strongly. We believe strongly in our company. The company is just out there in a very clear way, and we are doing the buyback program. We always keep this enthusiasm and research and development. So I do not have a doubt that better times will come, and we are going to be prepared to enjoy these better times. Thank you very much to all, and that is it.
Video conference, it will end now. We can answer further questions to investors. Thank you very much. Have a good day.