Dexco S.A. (DXCO3) Q4 FY2025 Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. Welcome to Dexco's conference call, where we will discuss the results for the fourth quarter of 2025. This conference call is being recorded. This recording may be seen at the company's website, ri.dex.co. This presentation will also be available there for download. [Operator Instructions] Before we continue, I would like to underscore that any statements made about the future are based on the company's assumptions and beliefs. This is all based on the information that is currently available for the company. These statements may involve risks and uncertainties as they refer to future events that, therefore, depend on circumstances that may or may not occur. Investors, analysts and journalists should take into account that events related to the macroeconomic scenario and to the industry and other factors may lead these results to differ materially from those expressed in these forward-looking statements. We have with us in this conference call, the company's Executive Directors and the Investor Relations team. We will now hand it over to Ms. Lucianna Raffaini, CFO, who will begin the presentation. Go ahead, Lucianna.

Hello. Good morning. Welcome, ladies and gentlemen. My name is Lucianna Raffaini, CFO at Dexco, and it's a pleasure to be here with you to present our results for the fourth quarter and for the full year of 2025. And today, we're also going to talk about our perspectives for 2026, which is a very special year for Dexco, in which we will celebrate our 75th anniversary. We'll go into some of the things we intend to do. I'll start by presenting some of the main highlights for 2025. Starting with Dexco, our net revenue in 2025 was BRL 8.249 million (sic) [ BRL 8,248.8 million ] and adjusted recurring pro forma of [ BRL 2,468 million ]. If we look at the equity in LD Celulose, the company had [ BRL 2.468 billion ]. And I have a few highlights from our last quarter. In the fourth quarter, the Ceramic Tiles division continued to be pressured by high inventory levels and ongoing price deterioration. Sanitaryware were in line with expectations for the quarter with mix and price gains. The Wood Division posted another solid performance with strong panel demand. And LD Celulose reported a recurring EBITDA of BRL 350 million in the fourth quarter, of which Dexco's share was BRL 171 million. Our adjusted and recurring EBITDA was BRL 588 million, including equity income effects. Continuing with our cash flow. 2025 was marked by higher need for working capital, especially due to an increase in our inventory in metals. In the Tiles Division, inventory levels are still high, and we had some interruptions in the reverse factoring program as we reported in the previous quarter. There is a high level of interest rates, which continue to pressure us. And our CapEx was 5% below last year. This is due to our forestry industry, which is responsible for 67% of these investments. Our sustaining cash flow was positive at BRL 191 million for the year 2025, of which BRL 136 million was a positive generation in the fourth quarter. Finally, it's important to underscore that we are at the end of our investment cycle from 2021 to 2025, and we will see a reduction year-on-year in projects of 23%. So looking at these impacts, our cash consumption was BRL 382 million and 18% working capital to net revenue. Cash generation is our priority for 2026. Now, let's talk a bit about our corporate debt. We advanced with a successful plan to extend and reduce the average cost of our debt. So, that reduces our need to capture new debt until 2029, which will generate liquidity. Our debt amortization program is 8% short term and 92% long term, which places us at a very comfortable position. Our current net debt is at BRL 5.519 million (sic) [ BRL 5,519.2 million ] with an average cost of [ 9.52 ] of the CDI, a reduction in comparison to September 2025. Our average term was also extended to 5.4 years. Considering leverage, we had a reduction of 13 basis points versus the previous quarter, which signals that we will continue to be stronger in reducing our debt. Our final leverage was 3.35x net debt to EBITDA. After January 5, our leverage will be 3.22x net debt to EBITDA. And this will continue in our priority to deleverage the company. Now, we will talk a bit about Ceramic Tiles to give some context to the industry and then talk about our results. The ceramic tiles industry is stagnated. The market is fragmented, overcapacity and with the strong price pressure, which has led to losses across the entire industry. The industry continues to be at 72% capacity utilization according to ANFACER. And we can see that it has been flat since 2023 with the same volumes, 230 million square meters per year. In comparison to the post-pandemic year of 2021, the market has contracted by 22% of its volume. So we are seeing a gradual recovery, but this is still insufficient to normalize inventories, and the entire chain is still very idle. Our results in the tiles environment was impacted by our competition, and we finished the year at 67% capacity utilization. Our strategy in this division is to reposition our channels, commercially optimize our portfolio and prioritize higher added value segments, focusing on cash generation and price discipline. Our results had a reduction of 4% in our volume in the fourth quarter. And for the full year of 2025, we were at 16.6 million square meters in volume. Net revenue dropped 13% in the fourth quarter and 9% for the full year of 2025, concluding at BRL 812 million, or 20% gross margin, with an adjusted and recurring EBITDA at negative BRL 14 million. As a result of this environment and due to the company's internal decisions, our results for the fourth quarter was an adjusted recurring EBITDA of negative BRL 6 million for the fourth quarter. Continuing with the next slide. Now, we will talk about the Metals and Sanitaryware division. The sector has been pressured by price inflation, especially due to raw materials, inventory levels and interest rates, as this segment is deeply connected to civil construction. According to combined ASFAMAS data, we are seeing a reduction in gross revenue in the entire industry of 3.6%, but this does not include imported materials. If we add that to this, we can consider that the market is flat. The sanitaryware market has gained 6% in its gross revenue. Now, our performance. In the fourth quarter, the performance of Metals and Sanitaryware has been in line with expectations, considering the seasonal impact typical of the sector, collective vacations, maintenance shutdowns and higher material costs. Volumes dropped 6.5% in the fourth quarter, a reduction of 3.6% in 2025, excluding electric showers and faucets. Net revenue was flat for the fourth quarter at plus 0.2% and had a reduction of 3.7% for the full year of 2025. But the highlight here is our unit revenue, an increase of 10.2% in the fourth quarter of 2025 and 20.2% in the full year of 2025, which reflects price implementation and a premium product mix. Our adjusted and recurring EBITDA was BRL 23 million for the fourth quarter and BRL 92 million for the full year of 2025. This was impacted by inflation in costs in metals and operational efficiency challenges in sanitaryware, which have been partially offset by price adjustments and optimization in our factories. Now, continuing with Wood, starting with our sector environment. In Wood Panels, the fundamentals continue healthy with a high capacity occupation. Exports continue to contract, a reduction of 6.5% versus the previous year, but the demand has been reactivated in the domestic market. There is a lower volume being exported to the U.S. In the year, the entire market grew 0.2%, and the total panels decreased 1% quarter-on-quarter. Now, about our performance. 2025 was a record nominal adjusted and recurring EBITDA in the Wood division, which highlights our resilience in the Panels business. We had a small reduction in volume in the fourth quarter and in the year due to a higher level of inventory in the chain. Our operational recurring revenue reached [ BRL 5.520 million ]. Adjusted EBITDA was at BRL 1.572 million (sic) [ BRL 1,572 million], a growth of 3.8% with a margin of 28.5%. Recurring net revenue in the fourth quarter was up 4.6% to BRL 1.387 million (sic) [ BRL 1,386.8 million ]. We can now observe the capture of the price increases that we saw in the previous quarter, and this was aligned to a better mix and resulted in this level of growth in our unit revenue. In the fourth quarter, the adjusted and recurring EBITDA was BRL 400 million, an expansion of 14.4% versus the previous year with margins of 28.8% and a utilization of 97% of our capacity. Now, we will talk about LD Celulose. The highlights that we have for this division were the numbers for the quarter and for the year. These results are related to 100% of the operations. In 2025, LD finished with a volume shipped of 604,000 tons, up 3.3% versus the full year of 2024. Net revenue was [ BRL 3.150 million ], up 5.9%, which resulted in an adjusted and recurring EBITDA of BRL 1.669 million (sic) [ BRL 1,668.9 million ], with a net income of BRL 448 million. So this reflects our strong operational performance and a very positive yearly comparison, even though it was influenced by foreign exchange effects in our financial results. In the fourth quarter, the adjusted and recurring EBITDA was BRL 350 million, which shows these effects and a reduction of DWP prices in the international market. 2025 had a historical productivity level and showed our strong productive capacity, operational efficiency and consistent quality. Now, we will talk about our transformation plan as presented during Dexco Day in November. We continue following this plan, and it still guides Dexco's agenda. As we shared then, we have 5 priorities. I'm going to start with financial deleveraging, which is our main priority. In this case, we issued debentures and CPRs, which helped us with our liquidity. We also had some recent land and forest re-monetization initiatives. And we sold nonoperational assets, which added BRL 115 million to our cash until the end of December. These were consistent actions. This is our shared commitment, as we said, to analyze operational and nonoperational assets. This continues to be a strong agenda for 2026, and we are focused on sustaining and positive cash generation with working capital initiatives and reducing expenses in CapEx. Now, let's talk about our go-to-market front. In go-to-market, we redesigned our strategy to service channels and our priority segments, reaching 7 points in our share in the medium luxury metals division and 1 point in sanitaryware. We also are pursuing a higher ROI in sales. In metals, we have some products that were double digits and mitigated inflationary effects, adding more profits to our market investments, adjusting our list of salespeople. And in 2025, we opened 12 stores, Casa Dexco, and reinforced our relationship with specialized channels. In 2026, our focus will be to accelerate growth with new sales governance, a new service model and pursuing new price opportunities. We're also going to consolidate our presence in strategic channels with a strong portfolio and an attractive relationship program, which boosts our brands and makes us more profitable. \ Continuing with our turnaround lever, this, without a doubt, is our biggest challenge. In the fourth quarter of 2025, we simplified our portfolio, delisting 600 SKUs, which has given us a significant write-off to our inventories in these results. We also reorganized our factory capacity, closing plants and continued -- excuse me, closed our unit in Botucatu. We still have a lot to do, and we have some initiatives mapped and ongoing to be implemented. In the wood innovation front, we are exploring new initiatives aiming at increasing our expertise at this unit. We created DNF, which is for Duratex's forestry business, a section that will help us grow in wood beyond panels. These are new growth avenues that include creating wood, adding profits to forest residues such as wood chips, forestry expansion and some other initiatives connected to our deleveraging agenda. The last lever is competitiveness in Metals and Sanitaryware. In metals, we recovered some of our market share by increasing or improving our portfolio. And this has allowed us to expand in comparison to our main competitors and has ensured a higher flexibility in supplying the national and international markets. In sanitaryware, we have significant sales in industrial initiatives, which have contributed to a higher performance. This includes the optimization of our factory, closing the plant in Paraiba, which has given us a recurring EBITDA that was 8 points higher than the fourth quarter -- excuse me, third quarter of 2025. We have a robust, consistent strategy, and that's why the company is focused on executing these projects with excellence. Now, some future perspectives for 2026. We will continue on our transformation plan. And in the case of deleveraging, we will continue to monetize forestry assets, and we will provide tax credits besides having operational and nonoperational assets. We are going to reduce our leverage to around 2.7 net debt to EBITDA until the end of the year. In our turnaround for the Tiles segment, we will still have a challenging year, but we will continue executing and improving our mix and channels, focusing on high added value, automation and operational and asset optimization. In Metals and Sanitaryware, we can increase prices as we have done in December and February. We can consolidate our service level and reduce operational costs through automation in sanitaryware and through operational efficiency in assets. In sanitaryware, we have increased cost competitiveness, and this will probably be reflected in our P&L for the next months. In metals, we will -- we have increased service levels, which have helped us to capture more market share. And for 2026, we expect to continue that. And at the same time, we are accelerating some efficiency, working capital optimization initiatives. We are improving prices, and we will be more flexible in delivering, which are impacting our prices. In Wood, our expectation is to maintain this strong demand in the panels market and to generate complementary businesses through Duratex forestry. LD Celulose is poised for another year of high productivity and a solid operational performance. In go-to-market, we will have a structured plan with a broader growth vision, focusing on the top line. We're also reviewing our channel strategy, the commercial policy, investments in trade and priority contracts. And we continue to simplify our portfolio and use more technology for our performance management and for sales execution with RGM possibilities. We're also seeing a gradual rollout of the new Casa Dexco franchise stores. This concludes our presentation, and we are now available for our Q&A. Thank you.

[Operator Instructions] The first question will be asked by Mr. Matheus Meloni from Santander.

I have 2. First, I'd like to understand this issue in the Ceramics division, the rationale there. And if you have done everything or if there is still more initiatives to come? My second question is about LD Celulose. How much do you expect -- or when do you expect payments to be made, dividends? And are you trying to advance this to help with leverage? That's all.

Matheus, thank you for your questions. I'm going to let Lucianna Raffaini answer both of these questions. Go ahead.

Thank you for that question. So starting with the first one about impairments, with all the changes that we had closing a few sites, in Deca, for example, we had BRL 30 million in our inventory, an additional BRL 30 million in sanitaryware in Paraiba. So this is all part of our factory footprint adjustment that was made at the end of the year. In Ceramic Tiles, this was BRL 94 million in inventory. Out of this BRL 94 million, we have the GM revision to optimize our portfolio. So you can consider those. And with the closure of RC1 and RC2, we have an additional BRL 102 million, which have been redirected to the immobilized base. So that's an overview of our impairments for the year. So, that answers your first question. For LD Celulose, without a doubt, we've been having very good performance. Our expectation is that we will consolidate and sustain this performance because we have accelerated. If you look at the performance that LD had, we are deleveraging at 2.6x due to that good performance that we've been having. I think that's it. Henrique, anything to add?

No, wonderful. Let's continue with the next question.

The next question will be asked by Mr. Matheus Moreira from Bradesco.

I have 2. First, I'd like to ask about Deca, which was the most striking division this quarter. Its results were far below what we expected. I understand that the company is adjusting its strategy for a more -- a higher added value mix, which has helped in price, but the cost has been much higher. What should we expect for the future? Should we expect costs to normalize in this division? And what do you believe the results will be for Deca from now on? My second question is about Ceramic Tiles. It drew my attention that the volume for Dexco was below the market level this quarter. I understand that some of that can be explained by the production adjustments that you made throughout the last year. But I would like to know if there might be any other reason. if you're facing a more challenging competitive environment? And still on Ceramics, if you can tell us a bit about how you see margin levels for the future? With Botucatu coming online and with some less competitive plants being removed, should we expect better margins in the next quarters? And sorry to ask a follow-up question to Matheus's question about dividends in LD Celulose. I saw that you received around BRL 70 million in dividends at LD in the last quarter. Is there any flexibility to maybe make these payments in 2026 because these payments are supposed to be made for the next 2 years? And how do you -- what is your take on the debt level from now on?

Thank you, Matheus. Lucianna will answer LD. And this is a statement for dividends payable for the next 2 years, referring to our results in 2025. Lucianna will explain this. And then Raul will answer your question about Deca and about Ceramic Tiles since he was the VP at the time in 2025.

Thank you for your question. To answer your question about dividends, what we currently have in our plan according to the obligations that we have connected to our debt and our bonds is that we have the potential to unlock in 2026, $5 million in dividends according to our projections. Of course, this is a huge potential that LD has been providing. So we're looking at alternatives to see if we can do something different and pay these dividends in advance, but it's still early to say.

Matheus, thank you for your question. Speaking about sanitary -- excuse me, speaking about Metals, this is a division that really suffered from the costs at the end of last year. I think you saw the increase in the price of copper that took place at the end of the third quarter. And it always takes some time to pass these costs in our prices. So we readjusted, but it wasn't so fast in the cost increase. Added to that, we also had some scheduled downtime, our production readjustment with new products and new product lines and portfolio. This made our production system less optimized. And that also impacted our costs, which have now been adjusted for this year. It's important to say that copper continues to go up in the fourth quarter. So we have had an increase in the fourth quarter of 2026, and we're starting to capture that at the end of the first quarter. So we did adjust costs for metals. In Sanitaryware, we are still consistent and aligned to what we said we were going to do. We are improving competitiveness, costs, and we've been very fast at that, especially after closing Paraiba. And there's also a wrap up -- excuse me, a ramp-up there. When you bring one production to a different place in Sanitaryware, this is much more complex to be adjusted. So there was a learning curve. And we are finishing the year at the best productivity, historical levels and production costs for Sanitaryware. We also increased in the main categories in Sanitaryware and the market has followed with some delays. So in 2026, we're going to see much healthier margins in Sanitaryware and Metals. So we will continue without interruptions or without any major changes in course in comparison to what we had planned for this division. Continuing with Ceramic Tiles, yes, we did lose a part of our volume, and this was embedded in our strategy. As we look at this low -- as we see this low occupation rate, as we see the market contracting and new capacities, we came to the conclusion that there is a part of the market that is addressable and where we can work. It doesn't make sense to continue to produce and sell products at the lower part of the market. We can't cover our costs that way. We can't have operational margins by doing that. So when we stepped away from this, we created a very clear effect because we had lower occupation. We adjusted for that at the end of the year. We adjusted our capacity temporarily. And since we did that, we started seeing better costs, and we were able to sell less with a better margin. So the game in Tiles is to leverage all the space we have in the specialized store, all the go-to-market effort that we made with a smaller capacity and leverage the brands that we have, which are market leaders. So the truth is that, as Lucianna said, this is a process that goes beyond 2026. But we will certainly start seeing much healthier margins now throughout 2026. But Ceramic Tiles are an integrated part of our strategy at Dexco. You can't think of Dexco without it. We're in retail, we're finding that Ceramic Tiles represent nearly 50% of the combined sales. So we want to continue in that industry with, of course, a much better strategy, a more fine-tuned strategy to work in segments where we have a better and winning value proposition in the market.

The next question will be asked by Ricardo Monegaglia from Safra. Mr. Ricardo? He may be having some technical issues. So let's continue with Marcio Farid from Goldman Sachs.

Just a couple of points from me. I know that Iran is a supplier of urea. So what alternatives have you been finding to them? And how are you offsetting these possible price increases? When it comes to forest and panels, results have been very strong in the last year. It was great to see, especially in the second quarter, a cleaner result with some clean results. So I'm just trying to understand what you're seeing on your end. Obviously, the macro scenario in Brazil seems to be slowing down. Interest rates are so high. It's an election year. So what are you seeing on your end in demand? And if there's anything from the supply side, if you could tell us a bit more about that.

Thank you for your question, Farid. I'm going to hand it over to our Wood VP, Henrique Haddad, who's going to tell us about urea and future perspectives for the Wood division and for wood panels.

Farid, thank you for that question. Good morning, everyone. So considering urea, although Iran is really an important player in this market, the 2 main variables that we have to look at are the consumption in India and supplies coming from China. China is a country that produces a lot of urea, but consumes all of it. So these are the 2 variables that we have to look at. Our supply base is not from Iran, but it can be impacted due to transportation because it does come from the Middle East from the opposite side. In the middle of last year, we started diversifying our suppliers. So through a multiple sourcing strategy, we were able to hedge and unlock some of the cost variations for urea. Of course, on the short term, there might be some balance issues, but we have been effective in managing these costs, which for us are a very important differentiator. It's important to say that we have planned the return of some urea factories in Brazil that used to be led by Petrobras. Despite not having huge volumes, we understand that this can also be helpful in rebalancing prices on the long term. About the panels market, I think Lucianna raised an important point. We're very happy with the panels operation remaining at a very positive level. In volume and profitability, we are coming close to or surpassing the results that we had during the COVID pandemic, which was a special moment for the market. We see that maybe one of the main factors to rebalance the market is to effectively find some stability in the supply. You might remember the time in which we had a huge amount of new capacity being brought to the market, which doesn't seem to be true anymore. There are 2 factors behind that. So we have to take some things into account when it comes to that. First, the investment for a factory unit continues to go up because of the global dynamics. But besides all of that, we now have some pressure in the availability of wood. So it's not trivial for someone to create a new capacity if we don't have a predefined forestry base. What we see is that the wood panels market has been very stable, very flat. It does fluctuate, but at a much smaller proportion. Considering that we have some stability in the supply, we see this as a positive perspective. Why? Because there's no big movement. The market has been advancing slowly without any major peaks or without major highs or lows.

And if I could ask a question about strategy. When you look at your current portfolio, do you need to make any aggressive adjustments? Obviously, we know that Electric Showers was an operation that had a low profitability for a long time before you removed it from your base. I know that in the last 12 months, you've been having several internal strategies to discontinue some operations, product lines, reduced SKUs. But my question is if you're -- if there's anything that can be more aggressive that you're taking into consideration? Or are you only expecting to continue in the same direction? And are you expecting any of the businesses to be at a better position?

Thank you, Farid. We've been saying for some time that yes, we do look at many alternatives for operational and nonoperational assets. This is what we've been saying. But the fact is that you're right, we are starting to do that structurally. What we did in investments this year was not trivial, reducing product lines, that's 30% of the products that we use. So when we make that clear to the market, when we position ourselves as a high-end segment with capabilities in Botucatu, this is a very important structural change. What I can tell you is that, yes, we are assessing this. We're talking about this in the company. We're exploring possibilities. But right now, we don't have anything concrete to tell you. But these options are definitely all on the table.

The next question will be asked by Guilherme Rosito from Bank of America.

I have 2. The first one is a follow-up to Matheus' question about Deca. Your EBITDA is much lower than that BRL 50 million that was discussed during the Dexco Day, which was your goal for the year. Of course, there's a seasonal pattern. But when you look at cost drivers, copper and aluminum has gone up. So how confident are you that you will reach this EBITDA level? How much does it depend on price? And I'd also like to ask for an update to your initiatives. How much do you want to raise by the end of the year? Just to give us an idea of how conversations are going?

Thank you, Guilherme. Before I pass it over to Raul and Daniel, let's just place everyone on the same page. During Dexco Day, we were very clear in saying that, that number would not repeat in the fourth quarter due to some issues such as collective vacations, programmed downtimes and a seasonal pattern. So we didn't expect that at least for Dexco and the Deca division for the fourth quarter for those reasons. I'll pass it over to Raul and Daniel.

And besides these 3 things, what changed was the speed in which copper prices were raised. We didn't expect that in our analysis then. So we were very fast in increasing our prices. But of course, this was not reflected in the quarter. Now let's bring in Daniel. So you asked a very important question about the future perspectives. So let's talk to Daniel and Menegon, which are the 2 new or not so new market leaders that are being brought to take care of Ceramics and Metals and Sanitaryware. Daniel, over to you.

Thank you, Guilherme. First of all, it's a big pleasure to be here today. Thank you to -- for inviting me to be here at Deca. So yes, we're very confident because we started the year with a cleaner base, a much better prepared asset base to reposition our price and mix. So to be direct about the pricing initiatives for the fourth quarter, as Raul said, we're going to get the full potential of that in the second quarter. Recomposing prices and renegotiations is slower, but price increases were between 12% and 20% depending on the SKU and the competitive strength that we have in each one of them. So yes, that will become more material soon, and we should see the effects of that in the short term. We'll see our margins going up. We're also depending less on super competitive products since we reviewed the factory footprint by closing one plant. So we have an organic mix gain effect in Sanitaryware. Also, as Lucianna said, there was also a delist in metals. We repositioned our portfolio, and we believe that this represents what Deca intends to be. And this mix is going to create more value. But when you have movements like this, that can have a negative impact. But in 2026, we'll start with a more solid base to capture the value of the initiatives that we implemented.

Let's continue with the next question, which will be asked by Mr. Pedro Melo from Citibank.

Most of my questions have been answered. So I'll just ask a follow-up question about Ceramic Tiles. I'd just like to understand what is your degree of confidence that this vertical will recover in the medium term, maybe in 2027 with the measures that you're using and also with this reduction in interest rates after the elections. So what might your results be for Ceramic Tiles in the medium term if we see a recovery in 2027 because we know that this year will be a bit more challenging?

Thank you for your question, Pedro. I'll hand it over to Raul.

Thank you, Pedro. We've been trying to give some clarity on -- since Dexco went into this industry, the fundamentals of this market changed significantly. So we also had increased capacity going into Botucatu, our entire process in retail, Casa Dexco is a major element. So we are becoming closer to that segment of specialized stores. All of that makes it so that this adjustment going to a more profitable product line and unlocking all of the potential that we built with Botucatu and also the possibility of operating with more efficient lines, which will lead to higher costs, but will also depend on full factories. So this equation between occupying space in the luxury segment, at the same time, as we ensure that we have good factory occupation levels, all of that takes time. And we can also say that the impact of high interest rates also made retailers keep an eye on their own working capital. So when you look at the volumes from 2022, no growth or slightly below what we saw in the COVID pandemic. It's not that the market disappeared. There's also the effect of the inventory throughout the chain. Since our service level is very good, our inventory can be much lower. So in that sense, 2025 and 2026 is still the last part of this process of adjusting our inventories throughout the chain. We're also finalizing this adjustment. Imagine what it means to reduce 30% of your portfolio, selling these products. We're not going to put it to waste. We're also going to sell it and reposition it without contaminating the premium markets. So in 2026, we will consolidate this change. In 2027, we hope to have double-digit margins in Ceramic Tiles.

This concludes the questions and answer session. We will now hand it over to Mr. Raul Guaragna, CEO, for the company's closing remarks.

Thank you, everyone. Like Lucianna said, this will be a very important year for Dexco. Dexco will be 75 in March, like Itau, which had its 100th anniversary and Itausa. And this is a part of our strategy, a long-term vision and belief in the Brazilian market. So that's the spirit that we carry in this important state. We want to continue having a long-term vision, responsible turnaround, conserving our ability to grow so that we can continue to be relevant and continue to lead across all the industries in which we work with a very strong cash generation perspective. At the end of our investment program, we're finding a tougher market on one hand, which has made returns more difficult. But on the other hand, it's giving us an asset that is our plant infrastructure that is extremely competitive. But this is much tougher than we had imagined earlier due to so many moving parts, as Farid said, so many things are changing. So we're focusing right now. We're continuing to reduce leverage. This is something that we will do with diligence. We need to continue looking at cash and generating cash consistently. That's a second element and making our culture stronger, our way of working, our way of being with a renewed infrastructure. Besides the people we have here, we also have Glazier, an HR, Marina, Jordana, a very strong team. And we're looking at Ceramic Tiles with the same focus that we had in the past. Ceusa, Portinari, all of that gives us a much more independent role without losing sight of our fundamentals, which is solutions for better living and being in people's homes and their finishing from [ vinylic ] to metals and wall tiles and wood. So that's the most important thing. And this year also marked our improvement in LD Celulose. I think this is also a very important division. So this year, we will need to focus. We will need to be very responsible in how we allocate our capital and generate cash. And we are starting 2026 strong and confident that we will post very good results aligned to our strategy of retaking the position that we've always had. Thank you, everyone. It's a pleasure to share these results with you for 2025, and we will continue available.

This concludes Dexco's conference call.