In This Article:
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Brasilagro - Cia Bras de Prop Agricolas (NYSE:LND) reported 870 million in net revenue for the first nine months, showcasing strong financial performance.
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The company achieved 195 million in adjusted EBITDA, indicating effective cost management and operational efficiency.
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Brasilagro has successfully locked in favorable prices for corn and cotton, ensuring stable revenue streams.
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The company has incorporated over 20,000 hectares of plantations, expanding its agricultural footprint and potential output.
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Brasilagro's strategic positioning in regions like Mato Grosso and Bahia has allowed it to capitalize on favorable agricultural conditions.
Negative Points
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The company faced significant currency volatility, impacting financial results and requiring careful management of exchange rates.
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Soy production was below budgeted expectations in some regions due to adverse weather conditions, affecting overall margins.
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High interest rates have increased the cost of capital, posing challenges for financing and investment decisions.
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Brasilagro's debt level is a concern, with a total adjusted net debt of 779 million riais, necessitating careful financial management.
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The company anticipates a need to rethink its budget and funding strategies due to changing economic conditions and interest rates.
Q & A Highlights
Q: Can you explain why Brasilagro considers the regions of Marano and Pia to be attractive for land purchases, and what opportunities or risks do you see from the trade war? A: Andre, CEO, explained that the company aims to buy land when others want to sell and vice versa. The regions of Marano and Pia are attractive due to their high leverage and expansion potential. Regarding the trade war, Andre noted that while Brazil could benefit from increased soy exports to China, the global balance between northern and southern hemisphere production is crucial. The trade war might offer more opportunities in beef and poultry sectors.
Q: What are Brasilagro's expectations for the sugar cane harvest, and how does logistics impact grain storage? A: Andre highlighted that sugar cane production is expected to be around 580-590 million tons, slightly below initial expectations due to weather conditions. On logistics, he emphasized the challenges posed by Brazil's terrain, which affects transportation costs. The company is considering investments in storage to capture gains, but high interest rates pose a challenge.