Rumo Sa

And we will begin the Q&A session. This presentation is being recorded and simultaneous translation is available by clicking on the Interpretation button. If you are listening to the video conference in English, you have the option to mute the original audio in Portuguese by clicking on Mute Original Audio. Before proceeding, we would like to reiterate that forward-looking statements are based on Rumo's executive board's beliefs and assumptions and information currently available to the company. These statements involve risks and uncertainties as they relate to future events and depend on circumstances that may or may not materialize. We recommend that you refer to the disclaimer on the second page of the presentation. Now, I'll turn the conference over to Mr. Felipe Saraiva, Rumo's Head of Investor Relations. Mr. Saraiva, you may begin the presentation.

Good afternoon, everyone, and thank you for joining Rumo's earnings conference call for the fourth quarter of 2025. Let me start with the highlights on slide three of the presentation. To close the quarter, we transported volume of R$22.9 billion. the all-time high performance in a four-scale. For the full year, volume increased 5% as a result of structural gains in capacity and operational efficiency. The combination of higher volumes and disciplined execution with lower costs and expenses allowed us to maintain resilient margins. I would like to highlight the 11% nominal reduction in unit fixed costs, showing better productivity levels. Adjusted BIDA reached 1.8 billion BIL in the quarter. an increase of 6% year over year. Investments were 1 billion and a half BRL in the quarter, in line with our planning for the period. Financial leverage at the end of the quarter was 1.9 times the net debt to adjusted EBITDA ratio, stable compared to the previous one. Moving to page four, I will present our market share in the quarter. Our market share remained at consistent levels, reaching 48% in Mato Grosso, 36% in Goiás, and 65% at the port of Santos. It's important to note that the fourth quarter had an exceptionally high comparison base for market share. In the fourth quarter last year, export volumes were unusually low, which temporarily increased our market share in that period, since we booked our capacity at the beginning of the season. Throughout 2025, we observed a normalization of the market dynamics. with market share returning to more normalized levels since the second quarter of the year. Now, moving to page five, I will share more details about this market dynamic in the Santos Corridor with our main market share. Let me start by reminding that the railway capacity is shared between the Goiás and Mato Grosso markets. functioning as a system of communicating vessels. Rain exports in these markets increased compared to 2024, although still below the peak observed in 2023. In this scenario, we expanded our market share compared to 2023, supported by the efficient use of our capacity. I would like to highlight the operational flexibility of the railway. with the simultaneous transportation of soybean, corn, and soybean meal throughout almost the entire second half of the year, maximizing the use of our assets. In the soybean complex, we recorded volume growth and market share gains compared to the 2023 crop. In corn, the record production was more directed to the domestic market, with higher carryover inventories at the end of the season. The railway remained the dominant transportation mode at the Port of Santos, reinforcing our key role in the transportation of agricultural commodities from the Midwest of the country. Moving to page six with the operational indicators, we increased volumes in the north and operation by 14%, which means more trains running throughout our system. Even so, we maintained stability in our main operational indicators, including trans time and dwell time at the Port of Santos. Regarding energy efficiency, we reduced fuel consumption by 2%, with good performance in both the northern and southern operations. On slide 7, I present the operational results and volumes. In the northern operation, I would like to highlight the strong performance in grains, with the simultaneous transportation of the three commodities and growth in AlvoSol commercial portfolios. In the southern operation, we also delivered a quarter of growth, with highlights in the agriculture commodities portfolio. Moving to page eight, let's look at the highlights for revenues and tariffs. In the fourth queue, we continued the commercial adjustment that started in the second quarter of the year. It's important to remember that the 2024 comparison base reflected a scenario with high expectations for the corn market, which did not materialize over the last two seasons. In this context, transportation prices are now reflecting more closely the actual dynamics and seasonality for our markets. I would like to reinforce our commercial strategy of maximizing value through the efficient use of our capacity. On page 9, I present the quarterly EBITDA. EBITDA increased 8% in the quarter, reaching 1.8 billion BRL. In the northern operation, The better performance in fixed costs and expenses, in addition to tax-related benefits of roughly 80 million BRL, helped support stable results, even in environments of adjusted prices. In the software operation, the higher transported volumes offset the lower average prices during the quarter. In addition, we had tax benefits of roughly 44 million BRL, which also contributed to the quarterly performance. Moving to page 10, we present the financial results and net income. Net financial expenses in the quarter were 721 million BRL, mainly reflecting a higher net debt base and interest rates. Even so, we delivered adjusted net income of 441 million BRL in the quarter and 2.1 billion BRL in 2025, both growing year over year. On slide 11, we move to debt and leverage. The net debt at the end of the quarter was 15 billion and a half BRL, reflecting the cash generation during the period. The financial leverage ratio was 1.9 times the same level as the previous quarter. Our liquidity position remains strong with $7.5 billion in cash position at the year end and a well-distributed debt to maturity profile. As presented in the chart on the right, we have no significant maturity in 2026 and 2027. Additionally, we have 2.7 billion BRL in committed credit lines that remain unrolled. On page 12, we present investments in the quarter. We invested 1.5 billion BRL in the quarter with 490 million BRL in recurring maintenance and 973 million BRL in expansion. At the Ferrovia do Mato Grosso project, we have accumulated roughly 4 billion BRL in investments since the beginning of the construction. with 80% of physical progress at the end of the year. Now let's move to page 13 with an update on the soybean market. In the state of Mato Grosso, production is estimated at 52 million tons. Harvesting is progressing normally in the region, slightly above the historical average. Exports from the state are expected to be slightly higher than the last year, with an estimated 13 million tons exported. Moving now to page 14, with the corn outlook. Corn production in the state of Mato Grosso is expected to remain at a high level, close to 60 million tons. The expansion of planted area by roughly 400,000 hectares supports strong agricultural production levels in the state. The quartz saffron seeding pace is also slightly faster than the historical average. Exports from the state are estimated at roughly 24 million tons, with strong production levels offsetting the increase in domestic demand. This concludes my presentation, and we are now available for the Q&A session. Thank you.

Joining us today are Mr. Pedro Palma, Mr. Guilherme Machado, and Mr. Felipe Saraiva. Before we begin the Q&A session, Mr. Pedro Palma would like to say a few words. Please go ahead, Mr. Palma. Thank you. Good afternoon. Thanks for joining us on Bruno's earnings release call. I'd like to start by reiterating that 2025 was a solid execution year in our operation. We have proven our ability to break records and shown our resilience and flexibility to navigate through different market scenarios. As Saraiva said, for instance, we had to operate products such as soybean, corn, and soybean meal simultaneously during the second semester. We also made significant progress in our efficiency agenda, both energy efficiency, proving the value of rail engineering use of technology that have allowed us to use 135 cars in the north operation. Improving the whole logistics network and reducing fixed costs and unit SG&A showing our discipline in reducing company costs and also improving structures and processes. These are inherent values to our culture and they will continue to be strengthened looking forward. According to our plan, we also made all the plan investments for the year. I'd like to highlight the progress in phase one of the Mato Grosso Railway as we announced in the material we shared with you yesterday. So 80% physical execution halfway through the year and on track for what we had mentioned. and this is no secret to you, was the market environment. We had to do some practical price repositioning, especially in the grains market, and we concluded that repositioning now this quarter in 2025. To remind you of what happened in the tariff scenario and providing a bit more detail on the north system, we increased prices. by approximately 70% between 22 and 24. When we started 25, in the first quarter, we realized that we were too expensive compared to other logistics alternatives. So we had to do some pricing repositioning to adjust our pricing level to market levels to make sure that we could continue to be the best most suitable competitive solution to be the first choice in logistics for the clients and markets where we operate. We're confident that now we are at a more suitable pricing level. We're working on our value creation, long-term value creation agenda at the company using our available capacity intelligently. And we also believe in the positive structural side of our market. Rumo is a single logistic platform because of the position of our railway and our terminals and we operate in the best markets such as Mato Grosso and Goiás where there's growing demand and Rumo has the ability to lead and logistics solutions to meet that demand. One point I'd like to mention is safety. which continues to be a non-negotiable value to us. In 2025, we restructured all of our safety and security process management. We reduced our incident frequency rate by 40% both with last time and no last time and safe operations are productive operations. We still have some work to do For instance, the rail security, there have been some events, you may have seen it in the media in the second half of the year. We did have a couple of agents that led to a rail incident frequency above what we had expected, but rest assured that all of the events have been analyzed in depth and all the lessons learned have been brought in-house and there was nothing structural in common among all those incidents, but each one of them was a lesson learned that will make us more resilient, more safer and more secure. As I said, safety and security is not a priority. It is a value that we will always continue to pursue. And as for the bottom line, I'd like to reiterate how solid our balance sheet is. We have been efficient in raising funds in the financial market. We raised close to 4 billion in new funding lines, reimbursed credit lines or undrawn credit lines, which ensures financial instruments at a very competitive cost and with a long-term maturity. So that will allow us to manage any turbulence with peace of mind. So the company is concluding the year with a very solid balance sheet, relevant operating indicators, very liquid cash position, and a great position in terms of investments execution profile. Looking forward, before we move on to the Q&A session, you've seen our results. volume results in January and February. We started off the year with solid volumes in both operations, both north and south, which makes me excited and confident with regards to the plan we'll be executing on in 2026. And absolutely sure that the company is ready to continue with its agenda to execute and from the investments that are being made. Now let's move on to the most interesting part of the presentation, the Q&A. Myself, Guilherme and Felipe are here to take your questions. Have a great afternoon. We will now begin the Q&A session. To ask a question, please click on raise hand. If your question has been answered, you can leave the queue by clicking on put hand down. We kindly ask that you ask only one question at a time so everyone gets a chance to ask their question. If we have enough time at the end, we will have another round of questions. Questions in writing via the Q&A icon will be answered after the conference by Rumo's investor relations team. First question is from Mr. Lucas Martins. Mark Iori from BTG Patrol. Please go ahead, Mr. Mark Iori. Thank you. Hi, good afternoon. Based on your disclosure and your comment on the pricing repositioning, Pedro, I understand that you've concluded the tariff repositioning process, so What exactly does that mean now going into this new year? What kind of tariff competitive process are you considering for the Q1 or first half of the year? We've seen road transportation now coming to life, especially at the beginning of the year, so I'd like to understand what your commercial dynamics will be in terms of tariff repositioning that you mentioned for Q1 and Q2. so that we can model it. Thank you.