Lavoro Reports Fiscal First Quarter 2025 Earnings Results

Core Viewpoint - Lavoro Limited reported a challenging fiscal first quarter of 2025, with significant revenue declines driven by market headwinds and liquidity constraints in Brazil's agricultural sector, while also indicating a commitment to strategic measures for recovery [2][4][23]. Financial Performance - 1Q25 consolidated revenue decreased by 13% year-over-year to R$2.05 billion (-24% in USD), with Inputs revenue down 9% and Grains revenue down 52% [4][5]. - Gross profit increased by 10% to R$321.2 million, with gross margins expanding by 320 basis points to 15.6% [5][8]. - Net loss for 1Q25 was R$267.1 million, compared to R$71.0 million in the prior year, largely due to changes in deferred tax assets and higher finance costs [5][8]. Segment Performance Brazil Ag Retail - Revenue decreased by 23% year-over-year to R$1.55 billion (-32% in USD), with Inputs revenue down 19% and Grains revenue down 63% [13][14]. - Gross profit grew by 7% to R$189.0 million, with gross margin expanding by 350 basis points to 12.2% [13][14]. - Adjusted EBITDA decreased by 6% to R$45.1 million, impacted by higher SG&A expenses [13][14]. Latam Ag Retail - Revenue increased by 4% to R$337.0 million (-8% in USD), supported by a stronger Colombian peso [17]. - Gross profit rose by 7% to R$47.8 million, with gross margins expanding by 40 basis points to 14.2% [17]. - Adjusted EBITDA decreased by 32% to R$10.4 million, primarily due to increased credit provisions and personnel costs [17]. Crop Care - Revenue surged by 68% to R$293.7 million (+48% in USD), driven by strong performance from subsidiaries [21]. - Gross profit rose by 11% to R$84.3 million, but gross margins contracted to 28.7% due to changes in product mix [21]. - Adjusted EBITDA increased by 24% to R$35.9 million, reflecting improved gross profit [21]. Revised Guidance - Lavoro revised its FY2025 revenue outlook to a range of R$6.50 billion to R$7.50 billion, with Inputs revenue projected between R$5.90 billion and R$6.90 billion [23][24]. - In USD terms, FY2025 consolidated revenue is now projected to range between $1.12 billion to $1.28 billion [24].