M. Dias Branco (MDIA3) Q1 2026 earnings summary

Executive summary

• Net revenue reached R$2.2 billion in 1Q26, up 0.4% year-over-year and stable, with sales volume up 3–3.4% YoY and EBITDA rising 21.8–22% to R$195.9 million.

• Net income rose 53–56% YoY to R$106–106.3 million, reflecting improved execution, market share gains in cookies, granola, and flour, and operational adjustments.

• The company maintained a net cash position of R$688 million, negative leverage at -0.6x, and a AAA Fitch rating for the eighth consecutive year.

• Despite a pressured consumption environment and high household indebtedness, operational efficiency and commercial restructuring supported performance.

Financial highlights

• Gross margin improved to 32.4% in 1Q26, up from 30.9% in 1Q25, driven by lower variable costs and currency appreciation.

• EBITDA margin expanded to 8.8% (from 7.3% YoY), with net margin at 4.8%.

• SG&A expenses increased 6.6% YoY, mainly due to volume growth, inflation, and increased marketing.

• Working capital improved, with supplier payment terms extended from 65 to 82 days.

• Cash flow from operating activities was R$194.5–195 million, down from R$280 million in 1Q25.

Outlook and guidance

• Management expects continued double-digit growth in adjacencies and healthy products, with higher margins than core categories.

• Ongoing investments in automation and capacity expansion are expected to support mid- to long-term margin growth.

• Anticipates slight cost increases in Q2 due to commodity and fuel price pressures, but expects to offset with pricing adjustments and operational improvements.

• Management notes trends are based on past and present actions and may change with market conditions and the Brazilian economy.

• Ongoing promotional campaigns and product innovation are expected to support sell-out and category leadership.