T4F Entretenimento S.A. (SHOW3) Earnings Call Transcript & Summary

Good afternoon, everyone, and thank you for joining Time For Fun's earnings conference call for the second quarter of 2026. The second quarter was marked by a leaner calendar of company-promoted events. Teatro Renault was leased for the staging of Shrek the Musical. And in May, we promoted a concert by French singer Pomme. Following Marisa Monte's tour in Brazil in the Northeast held at the beginning of the year, we announced a new performance this time at Nubank Parque in November. For the coming quarter, Teatro Renault will host the premiere of Meu Filho, um Musical, inspired by the life of Paulo Gustavo in addition to other productions that we expect to announce soon. We will now move on to the quarter's financial and operating highlights. On Slide 5, we highlight our operating performance. During the second quarter of '26, we promoted one live music event, the concert by French artist Pomme, compared with 6 events in the second quarter of '25. In the first half of the year, we promoted 4 events and sold 53.6 thousand tickets versus 6 events and 30.2 thousand tickets in the 6 months of 2025. In addition to the events promoted by the company, Teatro Renault hosted the season of Shrek the Musical during the quarter. Also on Slide 5, net revenue in the second quarter of '26 totaled BRL 23.8 million, down 56% from the second quarter of '25, mainly reflecting the leaner calendar of company-promoted events during the period. In event promotion, net revenue was BRL 0.3 million, reflecting Pomme's single performance. In ticketing, food and beverage and venues operations, net revenue totaled BRL 21.1 million, down 28% from the second quarter of '25. Sponsorship net revenue totaled BRL 2.3 million, a decrease of 85%. On Slide 6, gross profit reached BRL 3.8 million in the second quarter of '26, down 71% from the second quarter of '25. Gross margin was 16% compared to 24% in the same period of the previous year. Continuing on Slide 6, we have operating expenses. SG&A decreased by 37% to BRL 9.3 million in the second quarter of '26. Including other operating income and expenses, operating expenses totaled BRL 11.6 million in the second quarter of '26, remaining virtually stable compared to the second quarter of '25. Moving to Slide 7. EBITDA in the second quarter of '26 was negative BRL 6.2 million compared with positive EBITDA of BRL 3.1 million in the second quarter of '25. EBITDA margin was minus 25.8% in the quarter versus 5.7% in the second quarter of '25, reflecting the lower level of company-promoted event activity during the period. On Slide 8, we present the financial results. Net financial result was negative BRL 6.2 million in the second quarter of '26 compared with negative BRL 4.2 million (sic) [ BRL 4.3 million ] in the second quarter of '25. The variation mainly reflects lower interest income, partially offset by lower financial expenses resulting from the reduction in debt and consequently lower interest expense, as well as lower combined negative impact from foreign exchange, monetary and hyperinflation effects. On Slide 9, we present net income. The company recorded a net loss of BRL 14.6 million in the second quarter of '26 compared with a net loss of BRL 0.1 million in the second quarter of '25. In the first half of the year, the net loss totaled BRL 18.6 million compared to BRL 12 million in the 6 months of 2025. Regarding the company's cash position, as shown on Slide 10, we ended the second quarter of '26 with gross cash of BRL 37.5 million and total debt of BRL 23.6 million, resulting in net cash of BRL 13.9 million, down 50% from net cash of BRL 27.5 million in the first quarter of 2026. On Slide 11, we present the company's cash flow. Operating cash flow was negative BRL 6.8 million in the second quarter of '26 compared with a negative BRL 33.1 million in the second quarter of '25, reflecting the lower level of operating expenditures in the quarter. Cash flow from financing was negative BRL 18.4 million compared with negative BRL 3.6 million in the second quarter of '25 due to principal and interest payments on outstanding loans. Total debt ended the quarter at BRL 23.6 million, down 63% from the second quarter of '25 and 32% from the first quarter of '26. We will now present our pipeline. In live music, Marisa Monte will perform at Nubank Parque in November with tickets already nearly sold out. Ticket sales also remain open for Laura Pausini's performance at Pacaembu in February of 2027. In the family and theater segment, Teatro Renault hosted performances of Minha Vida em Marte, starring Monica Martelli and ticket sales are now open for Meu Filho, um Musical, with performances beginning in August, in addition to other content to be announced soon. Thank you all for your trust. I reaffirm our purpose of bringing people together through exciting experiences that celebrate life.