São Martinho (SMTO3) Q1 2027 earnings summary

Executive summary

• Net revenue for 1Q27 ranged from BRL 1,529.8 million to BRL 2,244.7 million, with year-over-year changes driven by lower sugar and ethanol prices, reduced ethanol sales, and a strategic shift toward maximum sugar production.

• Adjusted EBITDA varied from BRL 582.3 million to BRL 1,094.4 million, with margins between 38.1% and 48.8%, reflecting both year-over-year increases and decreases depending on the source.

• Net income was BRL 38.1 million, down 39.3% year-over-year, impacted by lower sales volumes and prices.

• Heavy rainfall and El Niño affected operational efficiency, agricultural yields, and TRS, increasing fixed costs and impacting margins.

• Corn processing operations maintained margins and expansion projects remained on schedule.

Financial highlights

• EBITDA margin ranged from 8% to 48.8% depending on adjustments and reporting, with a notable year-over-year decline in some sources.

• Net debt/LTM EBITDA was 1.59x as of June 30, 2026, with net debt rising 5% to BRL 5.2 billion due to working capital and CapEx.

• Cash income and profit dropped sharply year-over-year, with cash profit down 93.9% in some reports.

• Debt term averages 5.3 years, with 91% long-term and 99% denominated in BRL.

• Liquidity remains strong at nearly BRL 5 billion, with no significant maturities in the next two years.

Outlook and guidance

• Guidance was not revised due to ongoing uncertainties, with more sugarcane available but lower TRS expected.

• Corn processing and CapEx disbursements are in line with guidance, and expansion projects for corn ethanol and biomethane are ongoing.

• Crushing volume could exceed 24 million tons if weather permits, but full guidance achievement depends on crop year extension.

• Ethanol inventory strategy focuses on storing product until demand and prices recover.