Fertilizantes Heringer S.A. ($FHER3)

Good day. Thank you for waiting. Welcome to Fertilizantes Heringer conference call to discuss fourth quarter 2025 earnings results. With us today are Mr. Gustavo Oubinha, CEO; Vladislav Guz, CFO and IRO; and Marcelo Ferry, Commercial Officer. We would like to inform you that this event is being recorded. [Operator Instructions] Forward-looking statements that might be made during this conference call regarding the company's business perspectives, projections are based on the beliefs and assumptions of the company's management as well as on information currently available. Forward-looking statements are not a guarantee of performance. They involve risks, uncertainties and assumptions as they refer to future events that may or may not occur. Investors should understand that general economic conditions, industry conditions and other operating factors may affect the company's future performance may lead to results that differ materially from those expressed in such forward-looking statements. Now I would like to turn the floor to Mr. Gustavo Oubinha, who will begin the presentation. Mr. Oubinha, you may begin.

Good morning. This is Gustavo Oubinha, speaking, CEO of Heringer. It is a pleasure to be here with you. I will start giving you an overview of the company. The full year 2025 was marked by a challenging operating environment with a focus on adjusting scale in the operations. There was a relevant reduction in volumes, both in the quarter and in the full year of 2,100,000 tons in 2024 to 1,600,000 tons in 2025, followed by significant changes in the mix of products and crops served. All of that aligned with the decision to hibernate some plants, always considering the market and economic scenario, the strategic positioning of the company, risks and opportunities, which are presented to us, a better capital allocation and reduction of fixed costs, always considering logistics and fiscal aspects as well as the economic performance of the company and the plants, thus reducing our intensive CapEx need and operating costs of such units. I now turn the floor to Marcelo Ferry, who will speak about the commercial area and market outlook.

Hello. This is Marcelo Ferry, Heringer's Commercial Officer. Talking about fourth quarter '25 quarterly deliveries. In Q4, we recorded about 390,000 tons, a reduction of about 34% compared to fourth quarter 2024, concentrated mainly on coffee and other crops. In the accumulated deliveries, we delivered about 1,600,000 tons, a drop of approximately 24%. This reduction was mainly concentrated in coffee, sugarcane and other crops. On the other hand, we recorded an increase in soybean and corn with a relevant impact on our mix. In the mix of products delivered in 2025, we advanced in the structural change in the sales mix with higher share of premium products and a relative reduction in conventional products. This move is aligned with the company's strategic evolution focused on products with a higher added value. We can see that mainly premium products either in the last quarter or in the full year posted an increase as a whole in terms of deliveries. Now speaking about market outlook. The market of imported raw materials in the first half of 2025 was marked by an appreciation of prices, followed by some stability and partial correction in the second half of the year. At the end of the year, the prices returned to levels very close to those observed in the end of 2024. Considering national grain production on the demand side, the expectation, the outlook for Brazilian culture or agriculture is positive with an expected growth in planted area and production. This points to a constructive view for the fertilizers market in the midterm. I now turn the floor to Gustavo Oubinha, who will present our financial performance.

Thank you, Ferry. I will now make some comments on our financial results. Volume retraction impacted net revenue, as we can see, BRL 4.6 million to BRL 4.1 million in 2025. And there is some cost dilution. Gross profit fell due to lower cost dilution and EBITDA remained negative in both the period and the full year. If we consider the full year in 2025, we had a negative number of BRL 176 million compared to BRL 192 million in 2024. On the other hand, financial results posted a significant improvement in 2025, benefited by a more favorable foreign exchange over the period, which contributed to a reduction in net loss compared to 2024, considering that in 2025, we had BRL 172 million of loss compared to BRL 1.1 billion in 2024. Regarding cash flow and liquidity, the company ended 2025 with approximately BRL 100 million in cash variation in the period reflected mainly a relevant reduction in inventories and taxes recoverable. In addition, the reduction in supply is partially offset by operating investments and an operating result that is still negative. Well, just as a final remark, I'd like to say that we remain focused on the execution of the operating plan, a strict cash management and financial discipline, maintaining transparent and responsible communication with the market. With this, we end the opening presentation, and we remain available to answer your questions. Thank you very much.

[Operator Instructions] If there are no questions, the conference call of Fertilizantes Heringer has come to an end. Thank you very much, and have a nice day. [Statements in English on this transcript were spoken by an interpreter present on the live call.]