Brasilagro Cia Brasileira De Propriedades Agricolas Q4 Earnings Call Highlights

Key Points

• BrasilAgro’s net loss narrowed to BRL 90 million for fiscal 2025/2026 from BRL 138 million, while revenue reached BRL 926 million and adjusted EBITDA totaled BRL 100 million.
• Sugarcane and cotton weighed on results, with weather and operational disruptions reducing sugarcane volumes and EBITDA by nearly BRL 60 million. Stronger soybean and corn productivity partially offset the weakness.
• Management is prioritizing debt reduction and selective land sales, supported by BRL 500 million in receivables, while planning to distribute approximately $0.30 per share in dividends and pursue improved margins in the next harvest.

Brasulagro Cia Brasileira De Propriedades Agricolas NYSE: LND reported a net loss of BRL 90 million for its 2025/2026 harvest year ended June 30, 2026, compared with a BRL 138 million loss in the prior-year period, as weaker sugarcane and cotton results offset stronger grain production.

The company recorded BRL 926 million in net revenue and BRL 100 million in adjusted EBITDA for the year, Chief Executive Officer André Guillaumon said. Management characterized the period as challenging amid commodity, currency, interest-rate and geopolitical volatility, but said productivity gains and land-development activities positioned the company for improved results in the coming cycle.

Sugarcane and cotton weighed on results

Chief Financial Officer and Investor Relations Officer Gustavo Javier Lopez said sugarcane was the principal factor behind the weaker operating performance. The company sold approximately 650,000 fewer tons of sugarcane than in the previous year, including roughly 300,000 tons affected by rain-related delays and another 300,000 to 350,000 tons affected by frost, operational issues and wildfires.

Lopez said the lower volume limited the company’s ability to dilute fixed cultivation costs and reduced sugarcane EBITDA by nearly BRL 60 million. Sugarcane historically generated contribution margins of about 27% for the company, he said, but margins declined during the year as production fell.

Cotton also faced quality and productivity issues in the prior harvest, leading BrasilAgro to reduce planted area and take a more conservative approach toward the crop. Management cited cotton’s high capital requirements, elevated interest rates and potential El Niño-related climate risks as reasons for greater caution.

Guillaumon said the company reduced off-season cotton acreage while increasing productivity by nearly 50% year over year in its current crop. He also pointed to a recent rebound in cotton prices, saying prices had risen from roughly 65-68 to nearly 90 in recent days.

Grains posted productivity gains

Grain operations provided an offset to the sugarcane and cotton pressures. Guillaumon said soybean production increased 19%, driven primarily by productivity gains, while corn production rose 30%. The company produced 416,000 tons, compared with 360,000 tons previously, according to the presentation.

BrasulAgro also reduced bean acreage by 70% after determining that the crop did not justify capital allocation given its risk profile, while still increasing bean productivity by nearly 40%. Management said it has used data analysis, telemetry and artificial intelligence tools to identify lower-return areas and redirect acreage toward other uses, including corn, cover crops and, in some regions, cattle operations.

Lopez said soybean and corn benefited from higher volumes, better margins and lower cost per ton. The company also expanded corn planting after identifying opportunities to sell to ethanol companies at more attractive margins.

Hedging, land development and costs

Management said its commercial and currency hedging strategy helped limit volatility. For the completed harvest, Guillaumon said the company locked in an average exchange rate of BRL 5.72 per U.S. dollar for soybean operations, while cotton was hedged at BRL 6.75 per dollar. Soybeans were sold at a Chicago reference price of 10.94, he said.

For the next harvest, the company has already locked in soybean prices above 12, compared with about 11 in the prior harvest, according to Guillaumon. It has also established some corn positions and secured more than 30% of farm-sale receivables.

Higher fertilizer prices remain a concern. Guillaumon said monoammonium phosphate prices rose from approximately BRL 580-BRL 600 per ton in the prior harvest to about BRL 800-BRL 850 per ton. Still, management said fertilizer cost increases should represent only about 2% of soybean cost per hectare, aided by purchasing decisions, currency management and increased internal seed production.

The CEO emphasized the company’s land-transformation strategy, saying area maturity generated nearly BRL 95 million of value. He said the company’s portfolio was valued at roughly BRL 3.1 billion and that internal assessments reflected both land appreciation and development of agricultural areas.

Debt reduction and farm transactions remain priorities

Lopez said BrasilAgro had about BRL 1.2 billion in debt and BRL 500 million in receivables. Management plans to use receivables and expected operating improvements to reduce debt, while seeking to extend certain obligations. Lopez said the company does not intend to renew its CRA debt instrument and is reviewing capital expenditures after spending roughly BRL 150 million annually over the past five years on land transformation, irrigation and technology projects.

Guillaumon said the company expects to pursue farm sales in the next period where assets have reached maturity and sale returns are attractive, while remaining a buyer of land when opportunities emerge. He said the company has sold more than BRL 2 billion of land over the past five years but does not expect to repeat that volume over the next five years without a major acquisition.

Management also said it plans to distribute about $0.30 per share in dividends, describing the payment as a demonstration of its commitment to shareholders despite the year’s losses. Guillaumon said debt reduction currently offers a better use of capital than a smaller share repurchase program.

About Brasilagro Cia Brasileira De Propriedades Agricolas (NYSE:LND)

Brasilagro Cia Brasileira De Propriedades Agrícolas is a Brazil-based agribusiness company focused on the acquisition, development and commercialization of agricultural land in key farming regions across the country. The company’s core activities include identifying undervalued or underutilized rural properties, implementing infrastructure improvements and modern farming practices, and either operating the land directly or selling it to third parties. Brasilagro’s land bank spans several states in Brazil, with holdings in Maranhão, Bahia, Tocantins, Goiás and Mato Grosso, among others.

In its agricultural operations, Brasilagro cultivates a variety of crops such as soybeans, corn and cotton, leveraging advances in crop genetics, irrigation and soil management to enhance productivity and sustainability.

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