Minerva Neurosciences, Inc

million BRL subscription warrants outstanding, representing 969.3 million BRL, which should help the company's cash flow over the coming years. Finally, we continued our financial liability management strategy, and yesterday we announced the repurchase and effective cancellation of 76 million BRL related to the 2031 bonds. In total, throughout 2025, the company bought back and cancelled approximately 385 million BRL, totaling 2.3 billion BRL, related to the 2028 and 2031 bonds, an initiative that reinforces our commitment to a more balanced and efficient capital structure, reducing financial costs and strengthening the balance sheet's flexibility. Now, regarding our sustainability highlights, we recently published our 14th sustainability report referring to fiscal year 2024. This report, confirmed by independent auditors and aligned with key international standards, reflects Minerva Foods' commitments to the ESG agenda and the creation of sustainable value throughout our chain. It consolidates our progress and results from the past year, reinforcing the integration of sustainability into our business strategy and into the company's day-to-day decisions. We also released the Animal Welfare Report, a document that includes data from our global operations, including the supply chain of animals and third-party raw materials of animal origin. The report highlights policies, procedures and progress towards the goals set as part of our commitment to the topic. For traceability, we achieved 100% compliance in the social environmental audit of cattle purchases in our operations in Paraguay for the sixth consecutive year, which demonstrates our leading position in traceability. Under the RENOVE program, we consolidated progress in implementing low-carbon and carbon-neutral protocols at locations in Brazil, Uruguay, and Paraguay, with support from external audits to verify the carbon balance at each facility. We also made progress with our subsidiary, MyCarbon, achieving significant developments in carbon credit generation and trading projects, with new partnerships in more than 145.7 thousand hectares where we had detailed diagnostics of agricultural practices assessing the potential and opportunities for carbon project development. On slide 4, we'll discuss our performance by origin. At the top of the slide, we have a breakdown of gross revenue by destination. Asia led accounting for 28% of gross revenue, with China standing out at 17%. Next comes NAFTA, which represents 25% of our revenue for this period, led by the US with 21%. It's worth noting that this high share of US revenue is mainly due to the impact of stock sales directed to the North American market in previous quarters. Following that, we have the Americas, accounting for 24% of gross revenue, with Brazil at 17% and Chile at 6%. I'd also like to highlight the importance of the domestic market, which maintains a consistent share in our revenue mix. The continued strengthening of our brand and expanded market penetration in Brazil have helped reinforce our presence among consumers and support the sustainable growth of our local operations. In the lower left, we show export performance for our beef operations during the third quarter of 2025. Asia was the main destination, accounting for 45% of export revenue for the quarter, with China alone responsible for 36%. NAFTA comes next, with a 14% share. Following that, the Middle East accounted for 11, the European Union, the Americas, and the Community of Independent States, and Africa contributed 3% of total exports. Looking now at the last 12 months ending in Q3 2025, Asia remained the top destination with 33% of exports. China accounted for 25% of that. NAFTA was second with 29%, led by the US at 23%. The Americas accounted for 12% of exports, followed by the Middle East at 9%, the European Union at 8%, Eastern Europe at 7%, and Africa with 2%. On the right side, we show the exports of our lamb operations in Australia and Chile. In the third quarter, NAFTA remained the main destination, with a 43% share, driven largely by the U.S., which alone represented 42%. Asia came next with 27%, Europe at 19%, and the Middle East at 6% of quarterly exports. In the last 12 months ending in 3Q 2025, we had a similar picture. NAFTA led with 44% of exports, followed by Asia with 25%, Europe with 17%, and the Middle East with 7%. Let's now look at our revenue performance. The international market remained the main driver of our performance. Exports accounted for almost 70% of gross revenue in the third quarter and 64% in the last 12 months, excluding the other category. Looking at a breakdown by operation, Brazil exported 68% of its production in the quarter and 59% in the last 12 months, ending in the third quarter. In the last 10 operations excluding Brazil, the export rate was even higher, 71% both in the quarter and in the year-to-date 12-month period. For lamb operations in Australia and Chile, we had a similar scenario. Exports accounted for 65% of gross revenue in the quarter and 73% over the last 12 months. On the right-hand side, we show gross revenue by origin. Brazil, due to its strong cattle availability, continues to be the main operational driver, contributing 62% of gross revenue in the quarter and 55% in the last 12 months. Next are Paraguay and Uruguay, both at 10% in the quarter. In the last 12 months, Paraguay contributed 12% and Uruguay 9%. Argentina accounted for 7% in the quarter and 10% in the last 12 months. Australia contributed 3% in the quarter and 5% in the last 12 months. And Colombia had a share of 3% in the quarter in over the past 12 months. Lastly, the other category linked to our trading division represented 5% of revenue in the quarter and 6% in the last 12 months. Before diving deeper into the financial highlights, I'd like to emphasize how optimistic we are regarding the end of 2025 and the opportunities emerging in the global animal protein market. The ongoing imbalance between supply and demand continues to create a favorable environment for South American beef exporters. As we've highlighted in recent quarters, this scenario is mainly the result of supply constraints due to the cattle cycle in key producing regions. While South America continues to expand production and export volumes, other relevant markets face supply constraints in the face of still resilient domestic demand. This dynamic has supported high price levels and driven increased imports, especially those originating from our continent. In China, the third quarter was marked by strong import volumes, driven both by preparations for the Chinese New Year and the local cattle cycle, which is beginning to constrain domestic beef production and, as a result, is creating more space for international products. As we've been discussing, the US market remains constrained, with a still depleted herd and a clear impact on domestic beef output, a scenario that's expected to remain existing for the coming years. More recently, Europe has also begun to feel the effects of the global beef supply imbalance, with major producers in the region, such as France, Germany, Ireland and Poland, beginning to experience herd and production challenges, which is already starting to reflect in export dynamics. The global beef demand environment remains positive, even in the face of political uncertainty, creating favorable prospects for exporters from our continent. In this sense, Minerva Foods stands out for its strong arbitration ability between markets, reinforcing our competitive positioning amid this highly volatile environment. Lastly, before handing things over, I'd like to underscore that our geographic diversification strategy continues to be one of Minerva Foods' greatest strengths. It allows us to mitigate risks, respond quickly to market shifts, and maintain competitiveness even in a challenging global landscape. This strategic resilience supports the consistency of our results and reinforces our long term vision, a vision in which we believe it's entirely possible to combine large scale production with environmental preservation, technological innovation and social value generation. I'll now turn it over to Edison to walk us through this quarter's financial highlights.

Thank you, Fernando. Let's move on to slide six, where we'll discuss the performance of the newly acquired assets. In line with our commitment to provide greater transparency regarding the performance of the newly acquired assets, since Q4-24 we've been presenting a breakdown of volume and revenue between Minerva's legacy and newly acquired assets. This quarter, Brazil once again stands out as the main highlight, with a consolidated revenue of 10 billion BRL, of which 3.6 billion came from the new assets. In Argentina, consolidated gross revenue was 1.2 billion, with the new plants contributing with 278 million. While in Chile, the new sheep processing facility in Patagonia posted a revenue of 31.1 million, and other countries have maintained the regular course of their operations as no changes have occurred in their asset base. Consolidating all of our origins, we reached a total gross revenue of 16.3 billion in Q3, up 80%, of which 11.5 billion refers to Minerva Foods legacy assets and four to the new assets. As Fernando highlighted at the beginning of the presentation, in Q3 25, we successfully completed the integration process ahead of schedule. We initially expected the process to last 15 to 18 months, but we have managed to conclude it in less than a year. It's worth emphasizing that completing this phase ahead of schedule reflects the quality of the strategic plan we implemented, which enabled us to follow a clear roadmap with well-defined milestones, properly mapped risks, which naturally contributed to the company's ability to accelerate its leveraging process. Let's now move on to slide seven for a closer look at the performance of the new assets. For today's call, we've prepared a new slide highlighting metrics on the normalized performance of the new assets, in other words, after the completion of the integration process. On the left-hand side, you can see the results for the past four quarters of the new assets. Operations in Brazil reached a gross revenue of 3.6 billion in Q3 and 8.2 billion LTM. In Argentina, 278 million in the quarter and 914 million LTM. And in Chile, 31 million BRL in the quarter and 82 BRL million LTM. So altogether, the new assets contributed with 3.9 billion in gross revenue in Q3 25 and 9.2 billion in the last 12 months. As Fernando mentioned earlier, This quarter marked the completion of the integration process, with September being the first month in which the new assets operated under normalized conditions, that is, operational and financial indicators that are in line with our historical base. Therefore, the fourth quarter, 25, will be the first fully normalized quarter post-integration, with no planned ramp-ups, an adequate sales mix, and no further working capital needed or investment needs related to the new assets. With that in mind, we carried out an exercise to assess the expected performance of the new assets in Q3-25 under normalized operating conditions. In other words, with the full integration and normalized operations. As a result, net revenue from the new assets would reach approximately 4.3 billion BRL. In other words, and also following the same concept of completed integration, annualized performance would have reached close to 17.2 billion BRL as shown in the table in the bottom right hand corner. As you know, Minerva Foods has historically delivered an EBITDA margin of around 9%, which was a rough average of the last 10 to 12 years. And so using that same level of margin, which I consider to be very conservative because it doesn't consider the post-integration synergies. The idea is to have a conservative and intelligible reference so that you can understand the level of performance we can expect from the new assets now that we have completed the integration. If we use the EBITDA margin of a historical level of 9%, that means we're talking about 388 million BRL coming from the new assets, or roughly 1.6 billion BRL worth of EBITDA on an annualized basis, slightly above our initial EBITDA expectations. You may recall that when we announced the acquisition back in 23, Our expectation was that the new assets would generate about 1.5 billion in EBITDA, including the Uruguayan operations, which, as you know, were not approved by the regulators and therefore not part of the current performance. So given these numbers, I'd like to draw your attention to how much was paid for this acquisition. There was so much controversy, so much debate in the last 24 months. Many people said it was expensive. But now, in light of the assets performance, it looks to me like this metric has become even more attractive. So we conducted a couple of analysis to illustrate this point. The first is the contractual value of the assets, so what was on the contract. In other words, 1.5 billion as an initial down payment and the remaining 5.3 billion upon completion and final payment in October 24. So if we consider 6.8 billion, As the total value of assets, the acquisition multiple was 4.4 times EBITDA. We can also try a more conservative approach and consider the cash impact of the acquisition. So the firm value of these new assets reflects not only the amounts that were on the contract, which were 6.8 billion, but also additional disbursements with interest and working capital adjustments, which were worth about 350 million reais, which adds up to 7.1 billion BRL in firm value. So, the transaction multiple in conservative terms would be about 4.6 times EBITDA. Historically, Minerva Foods' multiple has traded at around 5 to 5.5 times firm value over EBITDA. So it seems obvious that even from a purely financial standpoint, if we don't consider the strategic side of the acquisition, it was a very attractive acquisition, which is accretive to the company, given the evident discount to Minerva's historical multiple and what was paid in these two scenarios I've just shared with you. It's also important to emphasize that given the complexity of our sector and the size of this acquisition, this also includes other value generation strategic drives like capturing synergies over time, which further enhance performance and bring the acquisition multiple even further down, and it will make the acquisition even more attractive. In summary, the acquisition of the new assets is not only financially accretive and positive, but also a strategic milestone that reinforces our leadership position and significantly expands our market arbitrage capacity. We're very optimistic about the future and we're confident that the synergies among our operations and the successful integration of these assets will continue to generate substantial value and sustainable growth for the companies over years to come. Let's now return to the results discussion and move on to slide 8 to discuss net revenue and EBITDA. Starting with net revenue, it reached 15.5 billion BRL in Q3-25, once again marking an all-time record for a single quarter. That's an 82% growth year on year and 11% compared to the previous quarter. Over the last 12 months, ending in September, net revenue totaled 51.3 billion, also the highest annualized figure ever recorded by the company. It's worth noting that we are already within the 25 net revenue guidance, which we announced earlier this year, which ranges between 50 to 58 billion BRL in net revenue for the full year of 25. Turning now to profitability, EBITDA in Q325 reached 1.4 billion BRL, the highest ever achieved in a single quarter, which accounts for a 71% increase year on year and 7% quarter on quarter, with an EBITDA margin of 8.9%. I'd like to highlight once again the excellence in operational and financial execution consistently demonstrated by Minerva Foods over recent quarters, even in light of such a highly complex and volatile global environment. Over the last 12 months, consolidated EBITDA, including the pro forma effect One month of the new assets totaled 4.7 billion BRL. Once again, let me highlight that we delivered solid operational performance and profitability consistent with our historical levels, a direct result of robustness of our business model, specifically the benefits of our geographic diversification strategy, arbitration, which are critical to our resilience and operational and financial performance, especially amid the recent volatility. Now let's move on to slide nine to discuss financial leverage. We ended the quarter with a significant improvement in net leverage, which declined from 3.16 times to 2.5 times net debt over EBITDA last 12 months. This result reflects two key factors. First, our consistently solid operational performance, with EBITDA reaching record levels both in the quarter and year-to-date. which is the result of not only a favorable global beef market conditions, but also the successful integration and contribution of the new assets, which scaled up revenue and EBITDA, while enabling the capture of synergies and greater operational efficiency, as well as cost dilution. As a direct consequence, we also have the leverage and the generation of free cash flow in Q325, which made a significant contribution to reducing our debt and reaffirmed our focus on financial discipline and our ability to convert results into cash. Combined, these factors underscore the company's commitment to operational efficiency, financial discipline, and long-term value creation for shareholders. Our deleveraging trajectory reaffirms the strength of our balance sheet and the soundness of our capital structure, increasingly more balanced and sustainable. Now let's move on to the next slide to discuss net income and operating cash flow. We posted a net income of 120 million BRL for the quarter and year to date. It's already reached 763.3 million BRL. Over the last 12 months, reflecting the non-cash impact of foreign exchange variation at the end of 24, net income remains negative at 804 million BRL. On the right-hand side of the slide, you can see the operating cash flow for the quarter, which was positive 3.4 billion BRL, while the last 12 months totaled approximately 6.3 billion BRL in operating cash generation. Now, on slide 11, we're going to discuss one of our main priorities, which is free cash flow generation, which was the key highlight of Q3 25. Building up Q3 25's cash flow, we start from a record EBITDA of 1.4 billion BRL. Next, we released working capital worth 2.5 billion BRL in the period, driven mainly by the reduction of inventories. particularly those associated with the US, and which accounted for 1.6 billion BRL released from the total. Additionally, the accounts payable line contributed approximately 625 billion BRL back to cash in line with the normal progress of the company's operating volumes. And the growth of companies' operations. As we mentioned last quarter, maintaining inventory in US territory was part of our tactical strategy, which proved highly successful. Given the country's current tariff policy, volumes already imported were not subject to the full taxes, which directly benefited revenue and strengthened Minerva's competitiveness in the local market. Continuing with the cash flow build-up, CAPEX totaled approximately 340 million BRL and focused mainly on maintenance investments and organic expansion projects. Cash-based financial expenses were negative 609 million, while cash-based derivative results consumed about, which is basically hedge and debt indexes, and consumed roughly 517 million BRL, which is a result of the mark-to-market effect on the hedge positions. As a result, we ended the quarter with a positive free cash flow of 2.5 billion BRL, the highest ever recorded in a single quarter. Looking at the last 12 months, free cash flow was also positive at 2.9 billion. We started with an EBITDA of 4.6 billion, CAPEX of a billion, and release of working capital of approximately 2.2 billion BRL last 12 months. Cash-based financial expenses were negative at around 2.8 billion BRL. Adding up these effects, it gives us 2.9 billion BRL positive free cash flow for 2025. These results clearly demonstrate the consistency of Minerva Foods' operational and financial performance with an accumulated free cash generation of approximately 11 billion BRL. Since 2018, this track record underscores the company's financial discipline and its strong ability to convert operating results into tangible free cash generation. Now, on slide 12, we reviewed the bridge of our net debt. At the end of the previous quarter, net debt totaled 14.2 billion BRL, Now, looking at the debt bridge in Q3, we have a positive free cash flow of 2.5 billion, which contributed to debt reduction. Foreign exchange variation also decreased in debtness in about 139 million and about 263 million related to non-cash derivatives, which increased the debt and the impact of 30 million BRL from having exercised the subscription warrants this quarter and which naturally reduced the net debt. As a result, net debt stood at 11.8 billion at the end of the period, down 17% from the previous quarter. Let's now turn to the next slide to discuss the company's capital structure. As mentioned earlier, net leverage measured by net debt over adjusted EBITDA stood at 2.5 times at the end of the quarter, the lowest since 2022. Keeping our conservative cash management approach, we ended the third quarter with a comfortable cash position of 14.9 billion and a debt duration of approximately 4.2 years with about 83% of total indebtedness in the long term, as shown in the amortization schedule at the bottom of the slide. Regarding our debt profile, approximately 67% of the total debt is exposed to foreign exchange variation. And let me remind everyone again that Minerva's strict hedging policy currently requires the company to maintain at least 50% of long-term FX exposure In July, we completed our 17th debenture issuance, totaling $2 billion across four series, with proceeds primarily allocated to debt buyback operations. In line with our liability management strategy, yesterday we announced the repurchase and cancellation of part of the 2031 bond, amounting to approximately $76 million U.S. dollars. bringing total repurchases and cancellations in 2025 to approximately 385 million US dollars or 2.3 billion BRL. This is yet another step toward achieving a more balanced and cost-efficient capital structure. In August, we also completed the capital reduction process to absorb accumulated losses from 24, which effectively cleans up the company's balance sheet and creates room to comply with our dividend policy come year-end. Finally, as previously mentioned, in Q3 2025, we exercised stock warrants arising from the capital increase, totaling 30 million BRL, with approximately 969 million still available to exercise through 2028, which will naturally have a positive impact on the company's cash position and indebtedness. To conclude, I'd like to thank the entire Minerva Foods team for their tremendous efforts and dedication during this crucial integration period, always acting with great focus and in line with our management model. We'll continue to work on continuous improvement and the pursuit of opportunities in the global beef protein market. We are confident in our strategy and long-term business. I'll turn it over to the operator so we can start the Q&A session. Thank you very much.

Thank you.