• Recurring EBITDA (Q4 2024): BRL1,284 million, a 23% decrease year-over-year.
• Recurring EBITDA (2024): BRL5,377 million, a 4% decrease from 2023.
• Net Income (2024): BRL2,526 million, unchanged from 2023.
• Dividends (2024): Total distribution of BRL769 million, with an additional payment of BRL493 million approved.
• Operational Cash Generation (2024): BRL3,736 million, a 3% decrease from 2023.
• CapEx (2024): BRL2,213 million, a 14% increase over 2023.
• Leverage: Increased from 1.3x to 1.4x due to lower LTM EBITDA.
• Ipiranga Sales Volume (2024): 2% growth, with a 5% increase in the outdoor cycle and a 1% drop in diesel.
• Ipiranga Service Stations (2024): 5,860, in line with 2023.
• AmPm Stores (Q4 2024): 1,450 stores, with a 9% same-store sales growth.
• Ipiranga EBITDA (Q4 2024): BRL1,841 million; recurring EBITDA BRL844 million, a 27% decrease year-over-year.
• Ultragaz Recurring EBITDA (Q4 2024): BRL441 million, a 9% growth year-over-year.
• Ultragaz Recurring EBITDA (2024): BRL1,687 million, a 2% growth over 2023.
• Ultracargo Net Revenue (Q4 2024): BRL283 million, a 10% increase year-over-year.
• Ultracargo EBITDA (Q4 2024): BRL169 million, a 9% growth year-over-year.
• Ultracargo EBITDA (2024): BRL668 million, a 6% growth over 2023.
• Investments (2024): BRL2,213 million, with 59% allocated to expansion.

• Warning! GuruFocus has detected 5 Warning Signs with FSK.

Release Date: February 27, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Ultrapar Participacoes SA (NYSE:UGP) maintained strong operational cash flow generation, allowing for increased investment levels while keeping financial leverage at comfortable levels.
• The company made significant investments, including a BRL1.8 billion acquisition of a 42% stake in Indrofus to Brazil and the acquisition of Witzler for BRL124 million, enhancing its energy solutions portfolio.
• Ultragaz and Ultracargo showed growth, with Ultragaz's recurring EBITDA growing by 9% year over year and Ultracargo's EBITDA increasing by 9% as well.
• The company announced an additional dividend payment of BRL493 million, totaling BRL769 million in dividends for 2024, reflecting a commitment to returning value to shareholders.
• Ultracargo experienced a 10% increase in net revenue year over year, driven by higher cubic meters sold and improved sales mix.

Negative Points

• Ultrapar's recurring EBITDA decreased by 23% in the fourth quarter of 2024 compared to the same period in 2023, primarily due to lower EBITDA at Ipiranga and losses from Hidrovias.
• The company faced challenges in the fuel industry due to unlawful practices, such as tax evasion and fuel adulteration, impacting Ipiranga's margins and market share.
• Ipiranga's recurring EBITDA decreased by 27% year over year, affected by reduced margins due to unlawful practices and higher inventory levels.
• Ultrapar's leverage increased from 1.3 times to 1.4 times in the last quarter due to lower LTM EBITDA, despite a reduction in net debt.
• The competitive environment in the fuel industry remains challenging, with unlawful activities affecting profitability and market dynamics.

Q & A Highlights

Q: What are the expectations for Ipiranga's margins in 2025, considering the challenges faced in 2024 due to unlawful practices? A: Rodrigo de Almeida Pizzinatto, CFO, explained that the margins were affected by unlawful practices, particularly in biodiesel. The expectation for 2025 is to continue fighting these irregularities, with some regulatory advancements anticipated to create a fairer competitive environment. However, the market remains challenging, and improvements depend on better regulation and enforcement.

Q: How does Ultrapar plan to leverage its strong balance sheet for investments during high-interest rate periods? A: Pedro Guedes, CFO of Ipiranga, stated that the company focuses on quality over speed in expanding branded stations. The investment strategy will be opportunistic, balancing market share with profitability, and leveraging the strong balance sheet to make strategic investments when beneficial.

Q: What growth opportunities does Ultragaz see in new energy solutions? A: Tabajara Bertelli Costa, CEO of Ultragaz, highlighted the development of new energy solutions, including biomethane and energy trading in the free market. These initiatives are expected to contribute significantly to growth, with a focus on integrating them into the existing business portfolio.

Q: Can you provide insights into Ultracargo's investment plans and potential for growth? A: Decio de Sampaio Amaral, CEO of Ultracargo, mentioned that 2024 saw record investments in port expansions and inland projects. The investment level for 2025 will remain robust, focusing on expanding SWAPI and other strategic projects, with flexibility to adjust plans based on market demand.

Q: How is Ultrapar addressing the unlawful practices affecting the fuel industry, and what impact do you expect from regulatory changes? A: Rodrigo de Almeida Pizzinatto, CFO, noted that regulatory efforts are underway to combat unlawful practices, particularly in biodiesel. The company expects these measures to gradually improve the competitive landscape, although immediate impacts on profitability are uncertain.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.