What BR Biopharma (BRBI) Said on Its Q3 Earnings Call

Key Points

• Third-quarter revenue fell 5.2% sequentially and 7.5% year over year to BRL 123.3 million; net income was BRL 23.5 million, with an 11.5% return on average equity. Management cited uncertainty that delayed client decisions.
• The investment-banking pipeline was near record levels, but deal conversion was below normal at 25%–30%; management said transactions were mostly delayed rather than abandoned. Capital-markets issuance volume increased year over year through September, though average deal size fell 55.1%.
• BR Partners reduced securities warehousing and leverage during the quarter, while its Basel ratio improved to 23.9%. It announced an interim dividend of BRL 12.6 million, or BRL 0.12 per unit, with payment expected November 26.

BR Partners reported lower third-quarter revenue as economic and political uncertainty prompted clients to delay decisions, while management said a strong investment banking pipeline had yet to translate into a normal pace of completed deals.

Revenue fell 5.2% from the second quarter and 7.5% from a year earlier to BRL 123.3 million. Net income was BRL 23.5 million, and return on average equity was 11.5%, Raul Rabello, an associate of investor relations and institutional affairs, said on the earnings call.

For the first nine months of 2026, revenue declined 3% year over year to BRL 388.2 million. Net income totaled BRL 96.3 million, with return on average equity of 15.9%.

Deal Pipeline Remains Strong Despite Delays

BR Partners announced 19 investment banking transactions through September, up from seven in the same period of 2025. Rabello said the pipeline included opportunities across sectors such as financial services, telecommunications, healthcare, retail and agribusiness.

Asked about deal conversion, Rabello said the rate was below normal at approximately 25% to 30%, largely because of uncertainty and volatility. He described the pipeline as close to record levels and said more transactions were being delayed than abandoned.

“We don’t see a lot of mortality of the deals, but rather more delays,” Rabello said, adding that a more favorable interest-rate environment and fiscal outlook could help conversion recover.

Combined investment banking and capital markets revenue was BRL 53.4 million in the third quarter and BRL 218.6 million for the first nine months, nearly unchanged from the same period a year earlier.

Capital Markets Activity Shifts to Smaller Deals

In capital markets, BR Partners conducted eight issuances totaling approximately BRL 1 billion in the third quarter, down from 15 transactions totaling BRL 1.9 billion in the prior quarter. Through September, the firm handled 42 issuances worth BRL 5.3 billion, compared with 24 transactions in the first nine months of 2025.

The average transaction size for the nine-month period was BRL 127 million, down 55.1% year over year. Rabello attributed the smaller average ticket largely to reduced demand for funding in the months before the elections. Looking ahead, he said conditions would depend on interest rates, the next administration and investor appetite, though the firm did not expect a reduction in average volume.

Treasury Sales & Structuring revenue rose 39.6% from the second quarter to BRL 25.9 million, helped by market volatility and growth in the client base. Nine-month revenue for the division fell 9.8% year over year to BRL 63 million.

Wealth management revenue reached BRL 4.9 million in the quarter and BRL 13.8 million for the first nine months, up 22.1% year over year. The platform ended September with BRL 6.2 billion in assets under advisory. Rabello said he expects the business to gain more traction and become a more material contributor to group revenue in another year.

Balance Sheet and Dividend

BR Partners reduced its securities warehousing position to BRL 2.6 billion at the end of September from approximately BRL 3.3 billion at the end of June. Leverage fell to 2.43 times from 3.26 times, while the Basel ratio rose to 23.9% from 21.6%.

Rabello said the firm used a favorable market window to reduce risk and retained appetite to deploy its balance sheet, while remaining selective. Capital revenue rose 52.5% from the prior quarter to BRL 39.1 million, driven by the recycling of securities warehousing positions.

The company announced an interim dividend of BRL 12.6 million, or BRL 0.12 per unit, representing a 54% payout ratio. The record date is November 12, with payment expected November 26.

Responding to an analyst’s question about credit provisions, Rabello said a one-off provision contributed to the increase during the quarter. He said the company did not expect a similar one-off event in the fourth quarter. On tax reform, he said BR Partners was still assessing potential effects with its advisers and auditors.

About BR Biopharma (NASDAQ:BRBI)

BRBI BR Partners SA, through its subsidiaries, operates as an investment bank which specializes in providing financial services for entrepreneurs and families principally in Brazil. It offers financial advisory services for mergers and acquisitions, capital markets, board services, shareholders, special situations and restructuring, pre-IPO, and privatization; and wealth management services. BRBI BR Partners SA is based in S?o Paulo, Brazil.

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