By Brazil Stock Guide – Votorantim Cimentos reported net profit of R$967 million in the third quarter of 2025, down 5% from a year earlier as higher borrowing costs eroded the bottom line in Brazil’s high-rate environment. The company’s operating performance, however, remained firm: net revenue climbed 15% to R$8.7 billion and adjusted EBITDA rose 10% to R$2.4 billion, with a stable 28% margin, supported by stronger demand and disciplined pricing across regions.
The quarter benefited from a 6% increase in global cement volumes, reaching 10.6 million tonnes, and from price adjustments that offset cost inflation in fuel, energy and raw materials. The combination supported steady profitability, with consolidated EBITDA margin only slightly below the 29% reported a year earlier.
Brazil Regains Pace as New Businesses Advance
In Brazil, net revenue rose 16% to R$4.1 billion, boosted by higher volumes and pricing in a market that expanded modestly during the period. Adjusted EBITDA increased 9% to R$927 million, as new business lines continued to gain traction. Cost pressure persisted, but commercial discipline and improved market conditions helped sustain profitability.
North America, Europe and Asia Expand Performance
North America posted net revenue of R$2.8 billion, up 10% in local currency, with improved balance between prices and volumes. Adjusted EBITDA rose 3% in local currency to R$930 million, despite cost increases and one-off effects that distorted the year-earlier comparison. Europe and Asia delivered one of the strongest performances of the quarter: revenue grew 12% in local currency to R$1.3 billion, while adjusted EBITDA surged 29% to R$447 million, reflecting efficiency gains and stronger results in Spain and Turkey.
Latin America Grows Despite Volatility
Latin America recorded a 39% rise in revenue in local currency, totaling R$334 million, and a 33% increase in adjusted EBITDA to R$81 million. Even with macroeconomic volatility in the region, Votorantim Cimentos leveraged operational improvements and portfolio diversification to expand margins.
Higher Interest Burden Weighs on Bottom Line
Financial expenses increased 23% year over year to R$426 million, driven by Brazil’s elevated interest rates and negative mark-to-market adjustments on derivatives. Depreciation rose 21% due to recent investments, contributing to profit compression. When excluding discontinued operations, profit from continuing businesses posted a 3% yearly increase.
Operating cash flow reached R$1.7 billion, up 28% from the prior year, helped by stronger EBITDA and a positive working-capital swing of R$141 million. Free cash flow to shareholders totaled R$1.45 billion, an increase of 23%, enabling the company to distribute R$1.8 billion in dividends during the quarter, including extraordinary payouts tied to the sale of Moroccan assets.
Capex Climbs 31% as Investments Intensify
Total investments reached R$831 million, up 31% from the year-ago period. About 75% of capex was allocated to maintenance, modernization and structural projects, while 25% targeted expansion. Key milestones included the startup of a new mill in Salto de Pirapora, adding 1 million tonnes of capacity, and the inauguration of a tire-shredding facility in Cuiabá capable of processing up to 1,500 tonnes per month to expand the use of alternative fuels.
Leverage Remains Stable Despite Higher Gross Debt
Gross debt reached R$14.9 billion, up 2.5% from 2024, with an average maturity of seven years and no significant short-term refinancing needs. The company closed the quarter with R$4.6 billion in cash, maintaining a net-debt-to-EBITDA ratio of 1.78x, virtually unchanged from 1.76x a year earlier. The liquidity position is sufficient to cover financial obligations for more than four years.
Liability Management Gains Another Layer
Votorantim Cimentos maintains two revolving credit facilities in dollars, including a partially drawn US$300 million line used to support seasonal working-capital needs in North America. A second line of US$250 million remains fully available until 2030 under a sustainability-linked structure. In October, the board approved a new debenture issuance of up to R$1 billion to extend maturities, prepay more expensive loans and reinforce liquidity.