Grendene (GRND3) Q2 2026 earnings summary

Executive summary

• Net revenue for 2Q26 was R$552.8 million, nearly flat year-over-year, with sales volume at 26.8 million pairs, reflecting a challenging consumer environment and a shift to lower-priced products.

• Operating profitability and cash generation were preserved despite selective domestic demand, with export growth led by Latin America.

• Adjusted EBIT dropped 48.2% to R$15.8 million, and adjusted net profit fell 48.6% to R$95.3 million, mainly due to lower operating leverage and a weaker net financial result after extraordinary dividend distributions.

• Gross margin improved to 42.4% (+0.4 pp), supported by disciplined cost management and lower raw material costs.

• The company maintained a strong net cash position of R$1.5 billion, supporting continued shareholder returns and business investment.

Financial highlights

• Gross revenue in 2Q26 was R$731.8 million, down 3.2% year-over-year; domestic market revenue fell 5.0%, while exports rose 2.3%.

• Gross profit was R$234.5 million (+0.6% YoY), with COGS per pair stable at R$11.89.

• Adjusted EBIT for 2Q26 was R$15.8 million (3.3% margin), and adjusted net profit was R$95.3 million (19.7% margin).

• EBITDA for 2Q26 was R$34.7 million, down 51.2% year-over-year; adjusted EBITDA margin was 8.4%.

• Net cash position at quarter-end was R$1.5 billion, down from R$2.2 billion a year earlier, mainly due to dividend and interest payments.

Outlook and guidance

• Management expects margin recovery in the second half of the year as higher value-added products are commercialized and seasonality improves.

• The company remains focused on operational efficiency, brand strategy, and maintaining a strong financial position to navigate ongoing market challenges.

• No significant changes anticipated in working capital dynamics compared to previous years.

• The company is monitoring potential impacts from new U.S. tariff measures and macroeconomic uncertainties on international trade.