EARNINGS RELEASE 1Q24
Curitiba, May 9th, 2024 - RUMO S.A. (B3: RAIL3) ("Rumo") announces today its results for the first quarter of 2024 (1Q24). The results are presented on a consolidated basis, in accordance with Brazilian and international accounting rules (IFRS). The comparisons made in this report consider 1Q24 and 1Q23, except when otherwise indicated.
Highlights
- Transported volume of 17.4 billion RTK in 1Q24, up 8% over 1Q23.
- Growth of 20% in consolidated yields, despite the 12% fuel price drop in the period.
- EBITDA totaled R$1,689 million in 1Q24, a 43% increase.
- Net income of R$368 million in 1Q24, boosted by higher volumes and margins across all operations over 1Q23.
- Financial leverage reduced to 1.7x net debt/EBITDA LTM.
- Capex totaled R$967 million in the quarter.
Summary of financial information | 1Q24 | 1Q23 | Chg.% |
(Amounts in BRL mln) | |||
Total transported volume (millions RTK) | 17,393 | 16,129 | 7.8% |
Logistics solution volume (millions of TU) | 1,453 | 763 | 90.4% |
Net operating revenue | 3,146 | 2,384 | 32.0% |
Cost of goods sold | (1,826) | (1,604) | 13.8% |
Gross profit | 1,320 | 780 | 69.2% |
Gross margin (%) | 42.0% | 32.7% | 28.2% |
Sales, general and administrative expenses | (163) | (111) | 46.8% |
Other op. revenues (expenses) | (57) | 9 | >100% |
Equity pick-up | 6 | 1 | >100% |
Operational profit | 1,106 | 679 | 62.9% |
Depreciation and amortization | 583 | 502 | 16.1% |
EBITDA | 1,689 | 1,181 | 43.0% |
EBITDA margin (%) | 53.7% | 49.5% | 8.4% |
Net profit | 368 | 71 | >100% |
Net margin (%) | 11.7% | 3.0% | >100% |
Capex | 967 | 928 | 4,2% |
Earnings Conference Call | Investor Relations | |
May 10th, 2024 | E-mail: ir@rumolog.com | |
Português* - 14h00 (horário de Brasília) | Website: ri.rumolog.com | |
*With simultaneous translation to English |
Earnings Release
1Q24
1. 1Q24 Executive Summary
In 1Q24, Rumo's transported volume reached 17.4 billion RTK, up by 8% over 1Q23. In 1Q23, operations were negatively affected by the worsening safety and traffic conditions in the Baixada Santista (SP) region, which jeopardized the circulation efficiency of trains heading to the Port of Santos. In 1Q24, growth was bolstered by improvement in the sugar, fuel, soybean meal and fertilizer portfolios.
Volume - Consolidated and by Operation (Bln RTK)
+8%
16.1
17.4+6%
12.6 13.3
+14% | ||||||||
2.7 | 3.1 | +17% | ||||||
0.8 | 1.0 | |||||||
Consolidated | North | South | Container | |||||
1Q23 | 1Q24 | |||||||
Rumo's grain export market share at the Port of Santos grew 51.3%. Rumo's volume remained flat year-on-year,despite the crop failure in the country's midwestern region, which mainly impacted volumes exported by other logistics solutions.
Grain Exports in Santos - SP
(Mm tons and %)
+1.5 p.p.
49.8%
-3.2%
13.3
+1.0%
5.1-4.7%
1.5
1Q23
Malha Central | Malha Norte | Market | ||
51.3%
12.8
5.1
1.4
1Q24
Source: Orion and Rumo System
Rumo's market share in the state of Mato Grosso increased 1.1 p.p. in the quarter. While the overall exports from Mato Grosso reduced 5% over 1Q23, Rumo posted a 2% decline.
Earnings Release
1Q24
Grain Exports in MT
(Mm tons and %)
37.9%
15.2
5.8
+1.1 p.p.
-4.9%
-2.0%
39.0%
14.4
5.6
1Q23 | 1Q24 | |||
Rumo | Market | |||
Source: Orion, Comex Stat and Rumo System.
Rumo's market share in the state of Goiás ended the quarter at 20.7%, registering a 2.9 p.p. growth. Goiás' grain exports by Rumo grew 11% year-on-year.
Grain Exports in GO
(Mm tons and %)
17.7%
+2.9 p.p.
-4.9%
20.7%
4.1 | 3.9 | |||
+10.8% | ||||
0.7 | 0.8 | |||
1Q23 | 1Q24 | |||
Rumo | Market | |||
Source: Orion, Comex Stat and Rumo System.
The South Operation gained grain market share at the ports of Paranaguá (PR) and São Francisco do Sul (SC). While the market grew 6%, Rumo grew even further, with a 9% higher volume compared to the same period last year.
Earnings Release
1Q24
Grain Exports in Paranaguá - PR and São Francisco do Sul - SC
(Mm tons and %)
29.3%
7.3
+1.0 p.p.
+5.7%
+9.1%
30.3%
7.7
2.1 | 2.3 | |||
1Q23 | 1Q24 | |||
Rumo | Market | |||
Source: Orion and Rumo System.
Soybean 23/24 crop estimates indicate a production decrease of about 4% versus the 22/23 crop, totaling to nearly 153 million tons. We can notice a national production redistribution, with the Midwest reducing volumes and the South returning to normalcy.
In the state of Mato Grosso, soybean crop was negatively impacted by climatic issues, which reduced the agricultural productivity of this crop, despite the slight expansion of the planted area compared to the year before. The 23/24 crop production in the state is estimated at 39 million tons, 7 million tons below the previous crop. Exports in the state are estimated at 24 million tons, a decrease of 6 million tons compared to the year before.
Preliminary estimates for the 23/24 corn production signal a level of 121 million tons produced, a decrease of 16 million tons. Exports may reach 43 million tons, approximately 13 million tons below the previous year.
The 23/24 corn harvest in Mato Grosso is estimated at 48 million tons, approximately 7 million tons below the previous year. Production in the state will benefit from favorable rainfall as corn was planted earlier in the year, partially offsetting a reduction in corn's planted area. Estimated exports for the state are of 23 million tons.
Brazilian Soybeans Production and Exports | |
(Milhões de toneladas e %) | |
+24% | -4% |
Brazilian Corn Production and Exports
(Milhões de toneladas e %)
-12%
+16%
137
160 | 153 | |||
Volume total | 129 | -6% | ||
+29% | ||||
118
121
101 | 95 | |
Volume | 78 | |
outros estados
Volume | 41 | 46 | 39 | |||
MT | 26 | 30 | 24 | |||
21/22 | 22/23e | 23/24e | |||
21/22 | 22/23 | 23/24 | |||
Prod | Prod | Prod | |||
Produção | MT | Produção outros estados |
Source: IM Rumo, AG Rural, Veeries, Orion, Comex Stat. IMEA
Note: (e) - estimate
+26%-23%
44 | 56 | 43 | |
42 | 55 | 48 | |
26 | 30 | ||
23 | |||
21/22 | 21/22 | 22/23e | 22/23 | 23/24e 23/24 | |
Prod | Prod | Prod | |||
Exportação MT | Exportação outros estados | ||||
Earnings Release
1Q24
Financial Information
In 1Q24, net revenue totaled R$3,146 million, a 32% growth over 1Q23. Improvement was reported across all operations: growth of 33% in the North Operation; 25% in the South Operation; and 35% in the Container Operation. This performance was fueled by higher volumes and yields in the period compared to 1Q23.
EBITDA totaled R$1,689 million, with an EBITDA margin of 54%. Variable costs went up 10%, given stronger transported volumes, despite the 12% decline in fuel prices. Fixed costs and general and administrative expenses expanded R$124 million in the quarter, reflecting the Company's decision to enhance structures and processes aiming at supporting its strategy of capacity expansion, efficiency gains, and risk management.
Net income came to R$368 million in the quarter, more than 100% growth year-on-year.
Financial leverage went down to 1.7x, with a net debt of R$10.4 billion.
Sustainability
Our corporate sustainability efforts were outstandingly recognized in 1Q24. We now compose the S&P Sustainability Yearbook 2024 as "Industry Mover", receiving the sector's highest score.
In terms of climate change management, we successfully completed the external audit of our greenhouse gas (GHG) emissions inventory, reinforcing our commitment to environmental responsibility. In the CDP rating, we achieved a B+ score in climate, highlighting our evolution in this area, while the B- in Water Security and C+ in Forests underline our commitment to various aspects of sustainability.
Concerning our social responsibility performance in the Baixada Santista region, we advanced socio-territorial diagnoses in key areas, such as Cubatão and São Vicente, identifying local needs and consolidating the pillars that will drive our initiatives in the region. We conducted preventive actions against dengue, assisting nearly 3,000 children in public schools of Cubatão. We also took part in the Vila Esperança's re-urbanization project, promoting sustainable development, and quality of life.
In April 2024, we published our 2023 Sustainability Report, a document that consolidates Rumo's key ESG highlights. The report is available for consultation through this link.
Earnings Release
1Q24 | ||||
2. | Consolidated Operating and Financial Indicators | |||
Summary of financial information | 1Q24 | 1Q23 | Chg.% | |
(Amounts in BRL mIn) | ||||
Total transported volume (millions RTK) | 17,393 | 16,129 | 7.8% | |
Agricultural products | 14,049 | 13,232 | 6.2% | |
Soybean | 8,110 | 8,145 | -0.4% | |
Soybean meal | 2,500 | 2,155 | 16.0% | |
Corn | 1,058 | 1,146 | -7.7% | |
Sugar | 1,054 | 540 | 95.2% | |
Fertilizers | 1,151 | 1,013 | 13.6% | |
Other | 176 | 232 | -24.1% | |
Industrial products | 2,376 | 2,069 | 14.8% | |
Fuels | 1,572 | 1,212 | 29.7% | |
Industrial | 804 | 857 | -6.2% | |
Containers | 968 | 828 | 16.9% | |
Net revenue | 3,146 | 2,384 | 32.0% | |
Transportation | 2,888 | 2,226 | 29.7% | |
Logistic solution¹ | 217 | 90 | >100% | |
Other revenues² | 41 | 68 | -39.7% |
Note 1: Revenue from sugar transportation using other railways or road transportation.
Note 2: It includes revenue from the pass-through fee of other railways, and revenue from volumes contracted and not executed according to commercial agreements (take-or-pay), among others.
Yield by Operation | 1Q24 | 1Q23 | Chg.% |
North Operation | |||
Yield (R$/000 RTK) | 165.2 | 134.0 | 23.2% |
% Volume | 76.5% | 77.9% | -1.5 p,p, |
South Operation | |||
Yield (R$/000 RTK) | 176,1 | 159,4 | 10.5% |
% Volume | 18.0% | 17.0% | 1 p,p, |
Container Operation | |||
Yield (R$/000 RTK) | 145,6 | 127,2 | 14.5% |
% Volume | 5.6% | 5.1% | 0.4 p,p, |
Consolidated | |||
Yield (R$/000 RTK) | 166,1 | 138,0 | 20.3% |
Earnings Release
1Q24
Results by Business Unit
Business Units
The business units (reportable segments) are organized as follows:
• | North Operation | Malha Norte, Malha Paulista, Malha Central |
• | South Operation | Malha Oeste and Malha Sul |
• | Container Operation | Container operations, including Brado Logística |
Results by business unit | North Operation | South Operation | Container | Consolidated |
1Q24 | Operation | |||
Transported volume (million RTK) | 13,298 | 3,127 | 968 | 17,393 |
Net operating revenue | 2,435 | 563 | 148 | 3,146 |
Costs of services | (1,271) | (422) | (133) | (1,826) |
Gross profit | 1,164 | 141 | 15 | 1,320 |
Gross margin (%) | 47.8% | 25.0% | 10.1% | 42.0% |
Sales, general and administrative expenses | (125) | (23) | (15) | (163) |
Other operating revenue (expenses) & eq. pick-up | (26) | (25) | - | (51) |
Depreciation and amortization | 407 | 148 | 28 | 583 |
EBITDA | 1,420 | 241 | 28 | 1,689 |
EBITDA margin (%) | 58.3% | 42.8% | 18.9% | 53.7% |
Earnings Release
1Q24
North Operation
Operational figures | 1Q24 | 1Q23 | Chg.% |
Total transported volume (millions RTK) | 13,298 | 12,566 | 5.8% |
Agricultural products -Malha Norte, Paulista e Central | 11,584 | 11,161 | 3.8% |
Soybean | 6,827 | 7,300 | -6.5% |
Soybean meal | 2,311 | 1,957 | 18.1% |
Corn | 802 | 672 | 19.3% |
Sugar | 543 | 252 | >100% |
Fertilizers | 1,101 | 982 | 12.1% |
Industrial products - Malha Norte e Paulista | 1,714 | 1,405 | 22.0% |
Fuels | 1,161 | 864 | 34.4% |
Industrials | 553 | 541 | 2.2% |
Average transportation yield | 165.2 | 134.0 | 23.2% |
The transported volumes in North Operation totaled 13.3 billion RTK in 1Q24, a 6% growth over 1Q23. This result was mainly driven by higher volumes of soybean meal, fuel, sugar, fertilizers and corn, besides evidencing the improvement in traffic conditions in the Baixada Santista (SP) region, which curtailed circulation efficiency of trains heading to the Port of Santos in 1Q23.
Financial results | 1Q24 | 1Q23 | Chg.% |
(Amounts in BRL mln) | |||
Net revenue | 2,435 | 1,825 | 33.4% |
Transportation | 2,196 | 1,684 | 30.4% |
Logistic solution | 217 | 90 | >100% |
Other revenues3 | 22 | 51 | -56.9% |
Costs of services | (1,271) | (1,088) | 16.8% |
Variable costs | (565) | (504) | 12.1% |
Fixed costs | (301) | (247) | 21.9% |
Depreciation and amortization | (405) | (337) | 20.2% |
Gross profit | 1,164 | 737 | 57.9% |
Gross margin (%) | 47.8% | 40.4% | 18.4% |
Sales, general and administrative expenses | (125) | (83) | 50.6% |
Other op. revenue (expenses) and equity pick-up | (26) | 2 | >100% |
Depreciation and amortization | 407 | 338 | 20.4% |
EBITDA | 1,420 | 994 | 42.9% |
EBITDA margin (%) | 58.3% | 54.5% | 7.1% |
Note 3: It includes revenue from the pass-through fee of other highways, and revenue from volumes contracted and not executed according to commercial agreements (take-or-pay).
EBITDA totaled R$1,420 million in 1Q24, a 43% growth over 1Q23, with a 58% margin. This result reflects the key role of the railway in the transportation of agriculture commodities from the Brazilian Midwest region, fostering a 23% yield growth in the quarter, despite the 11% fuel price drop.
Given that revenue by logistics solution more than doubled in 1Q24, the increase in variable costs derives from the results of this operation in the quarter. Fixed costs, general and administrative expenses went up nearly R$96 million, mainly driven by the strengthening of structures and processes, aiming at supporting the Company's strategy of capacity expansion, efficiency gains, and risk management.
Earnings Release
1Q24
South Operation
Operational figures | 1Q24 | 1Q23 | Chg.% |
Transported volume (million RTK) | 3,127 | 2,735 | 14.3% |
Agricultural products | 2,466 | 2,070 | 19.1% |
Soybean | 1,284 | 846 | 51.8% |
Soybean meal | 189 | 198 | -4.5% |
Corn | 256 | 475 | -46.1% |
Sugar | 511 | 288 | 77.5% |
Fertilizers | 50 | 32 | 56.3% |
Other | 176 | 232 | -24.1% |
Industrial products | 661 | 665 | -0.6% |
Fuel | 410 | 349 | 17.5% |
Industrial | 251 | 316 | -20.6% |
Average transportation yield | 176.1 | 159.4 | 10.5% |
South Operation transported 3.1 billion RTK in 1Q24, a 14% growth over 1Q23. The highlight in the quarter was the improvement in the soy, sugar and fertilizer portfolios, mainly in operations through Paranaguá and São Francisco do Sul ports.
Financial results | 1Q24 | 1Q23 | Chg.% |
(Amounts in BRL mln) | |||
Net operating revenue | 563 | 450 | 25.1% |
Transportation | 551 | 436 | 26.4% |
Other revenues4 | 12 | 13 | -7.7% |
Cost of services | (422) | (401) | 5.2% |
Variable costs | (119) | (123) | -3.3% |
Fixed costs | (155) | (139) | 11.5% |
Depreciation and amortization | (148) | (140) | 5.7% |
Gross profit | 141 | 48 | >100% |
Gross margin (%) | 25.0% | 10.7% | >100% |
Sales, general and administrative expenses | (23) | (16) | 43.8% |
Other op. revenue (expenses) and equity pick-up | (25) | 3 | >100% |
Depreciation and amortization | 148 | 140 | 5.7% |
EBITDA | 241 | 175 | 37.7% |
EBITDA margin (%) | 42.8% | 39.0% | 9.8% |
Note 4: It includes revenue from volumes contracted and not executed according to commercial agreements (take-or-pay).
EBITDA totaled R$241 million in 1Q24, up by 38% over 1Q23, with a 43% margin. This result was driven by a 11% growth in yields, despite the 17% fuel price drop, leading to flat variable costs in the period. Fixed costs, general and administrative expenses went up by 15%, given higher expenditures to support the Company's growth plan.
Earnings Release
1Q24
Container Operation
Operational figures | 1Q24 | 1Q23 | Chg.% |
Total volume (Containers '000) | 27,983 | 24,860 | 12.6% |
Intermodal average yield (R$/000 RTK) | 145.6 | 126.8 | 14.9% |
Total volume (millions RTK) | 968 | 828 | 16.9% |
Container Operation's volume moved up 17%, totaling 968 million RTK in 1Q24. This result was driven by pulp and paper growth and was also affected by the Ortigueira terminal project maturity. We also highlight the expansion of the cotton exports market in Mato Grosso, contributing to higher cotton volumes when compared to 1Q23.
Financial results | 1Q24 | 1Q23 | Chg.% |
(Amounts in BRL mln) | |||
Net operating revenue | 148 | 110 | 34.5% |
Transportation | 141 | 105 | 34.3% |
Other revenues5 | 7 | 4 | 75.0% |
Cost of services | (133) | (114) | 16.7% |
Variable costs | (75) | (62) | 21.0% |
Fixed costs | (30) | (29) | 3.4% |
Depreciation and amortization | (28) | (23) | 21.7% |
Gross profit (loss) | 15 | (5) | >100% |
Gross margin (%) | 10.1% | -4.4% | >100% |
Seles, general and administrative expenses | (15) | (13) | 15.4% |
Other op. revenues (expenses) and equity pick-up | - | 5 | -100.0% |
Depreciation and amortization | 28 | 23 | 21.7% |
EBITDA | 28 | 11 | >100% |
EBITDA margin (%) | 18.9% | 10.3% | 83.7% |
Note 5: It includes revenue from service units.
Container Operation's EBITDA totaled R$28 million in 1Q24, with 19% EBITDA margin. This result reflects higher value-added cargo handling, such as cotton and ore. Variable costs increased by 21%, primarily inflated by operations in the foreign market, ore, and cotton, where railroad freight exposure is higher. Fixed costs, general and administrative expenses increased 7% in the quarter, due to inflation adjustment and higher spending with technology.
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Rumo SA published this content on 09 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 May 2024 22:48:59 UTC.