Q1 2027 Jalles Machado SA Earnings Call

August 17, 2026

Speaker #1: Of the first quarter of crop year 2026-2027. First quarter 2027. This call is being recorded and has simultaneous translation into English, both replay will be available in the company's website, at ri.jalles.com.

Operator: of the first quarter of the crop year 2026, 2027. First quarter 2027. This call is being recorded and has simultaneous translation into English. Both replay will be available on the company's website at ri.jalles.com. All participants will be in listen-only mode during the presentation. After the presentation, we will hold a Q&A session, and further instructions will be given then. As we have limited time in this call, any questions that are not addressed during the call will be answered later by the company's RI team. The earnings release and the presentation on the first quarter of the crop year 2026, 2027 can be accessed on the company's IR website and also at the CVM's website.

Operator: Good afternoon, ladies and gentlemen. Welcome to Jalles Conference Call to discuss the results of the Q1 of the crop year 2026, 2027. Q1 2027. This call is being recorded and has simultaneous translation into English. Both replay will be available on the company's website at ri.jalles.com. All participants will be in listen-only mode during the presentation. After the presentation, we will hold a Q&A session, and further instructions will be given then. As we have limited time in this call, any questions that are not addressed during the call will be answered later by the company's RI team. The earnings release and the presentation on the Q1 of the crop year 2026, 2027 can be accessed on the company's IR website and also at the CVM's website.

Speaker #1: All participants will be in listen-only mode during the presentation. After the presentation, we will hold a Q&A session. And for this instructions will be given then.

Speaker #1: As we have limited time in this call, any questions that are not addressed during the call will be answered later by the company's RI team.

Speaker #1: The earnings release and the presentation on the first quarter of crop year 2026-2027 can be accessed on the company's IR website, and also at the CVM's website.

Speaker #1: Before proceeding, I would like to mention that any statements that may be made during the conference related to the company's business prospects, forecasts, operating and financial targets related to its growth potential, are based on the company's management's expectations, about the future of Jalles, such expectations are subject to change due to macroeconomic conditions, market risks, and other factors.

Operator: Before proceeding, I would like to mention that any statements that may be made during the conference related to the company's business prospects, forecasts, operating and financial targets related to its growth potential are based on the company's management's expectations about the future of Jalles. Such expectations are subject to change due to macroeconomic conditions, market risks, and other factors. Today with us is Mr. Rodrigo Penna de Siqueira, CFO and IRO, and Henrique Penna de Siqueira, Commercial VP. I would like to turn the floor over to Mr. Rodrigo Penna. You may proceed, sir. Thank you, Doris. Good afternoon. Good morning, everyone. Thank you all very much for joining us. One more earnings release call, first quarter 2027. We've brought to you a little bit about the market, such a volatile market, so many things happening at the same time.

Speaker #1: Today with us is Mr. Rodrigo Pena, Di Siqueira, CFO and IRO, and Enrique Pena Di Siqueira. Commercial VP. I would like to turn the floor over to Mr. Rodrigo Pena.

Speaker #1: You may proceed, sir. Thank you, Doris. Good afternoon. Good morning, everyone. Thank you all very much for joining us. One more earnings release call, first quarter 2027.

Rodrigo Penna de Siqueira: Thank you, Doris. Good afternoon. Good morning, everyone. Thank you all very much for joining us. One more earnings release call, Q1 2027. We've brought to you a little bit about the market, such a volatile market, so many things happening at the same time. We've brought Henrique, our Commercial VP, to be part of the Q&A as well. We are going to talk a little bit about the market perspective. We are going to share operational highlights, commercial highlights, financial highlights, and a little bit about cost of production.

Speaker #1: We've brought to you a little bit about the market, such as volatile market, so many things happening at the same time, so we've brought Enrique our commercial VP to be part of the Q&A as well.

Operator: We've brought Henrique, our Commercial VP, to be part of the Q&A as well. We are going to talk a little bit about the market perspective. We are going to share operational highlights, commercial highlights, financial highlights, and a little bit about cost of production. Let's start speaking about the sugar market. The world sugar balance of supply and demand for the year, we have a surplus according to the world sugar stock-to-use ratio. That's the position from 26 August. And for next year, we expect 1.6 million in deficit. You can see here the curve at lower levels of the historical series since 2014-2015. For the past 2 weeks, there have been a number of reviews of some agents reducing further this deficit. Some are getting to 3 to 4 million tons of deficits for next year.

Speaker #1: We are going to talk a little bit about the market perspective, we are going to share operational highlights, commercial highlights, financial highlights, and a little bit about cost of production.

Speaker #1: Let's start speaking about the sugar market. The world sugar balance of supply and demand for the year we have a surplus according to the world sugar stock, to use ratio, that's the position from August 2026.

Rodrigo Penna de Siqueira: Let's start speaking about the sugar market. The world sugar balance of supply and demand for the year, we have a surplus according to the world sugar stock-to-use ratio. That's the position from 26 August. And for next year, we expect 1.6 million in deficit. You can see here the curve at lower levels of the historical series since 2014-2015. For the past 2 weeks, there have been a number of reviews of some agents reducing further this deficit. Some are getting to 3 to 4 million tons of deficits for next year.

Speaker #1: And for next year, we expect 1.6 million in deficit. You can see here, the curve at lower levels of the historical series since 2014-2015.

Speaker #1: For the past 2 weeks, there have been a number of reviews of some agents reducing further this deficit. Some are getting to 3 to 4 million tons of deficit for next year.

Speaker #1: Welcome to Zoom. Enter your Meeting ID, followed by pound. Enter your participant ID. Please enter the meeting passcode. You have joined the meeting as an attendee and will be muted throughout the meeting.

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Speaker #1: According to that agro data, there is a reduction of production in India of 1.3 million tons, Thailand almost 2 million tons, EU with a substantial decrease of 16.6, going from 16.6 to 14.1, a major risk of production especially from beetroot, China increased 200,000 tons, not very much, and South with an increase in tons, 0.7% variation.

Operator: According to Agradata, there is a reduction of production in India of 1.3 million tons. Thailand, almost 2 million tons. EU, with a substantial decrease of 16.6, going from 16.6 to 14.1, a major risk of production, especially from beetroot. China increased 200,000 tons, not very much. And Center-South, with an increase in tons, 0.7% variation because of El Niño affecting all the countries in Asia, which may also affect Center-South region with rain. Abundant rainfall expected in the state of São Paulo and Paraná, so we expect a major effect if it happens. The situation has changed enormously in the past 2 weeks. And here, there is a comparison of the curve of the future of sugar in Brazilian reals. The dotted curve is from 1 month ago, so the light green curve.

Rodrigo Penna de Siqueira: According to Agradata, there is a reduction of production in India of 1.3 million tons. Thailand, almost 2 million tons. EU, with a substantial decrease of 16.6, going from 16.6 to 14.1, a major risk of production, especially from beetroot. China increased 200,000 tons, not very much. And Center-South, with an increase in tons, 0.7% variation because of El Niño affecting all the countries in Asia, which may also affect Center-South region with rain. Abundant rainfall expected in the state of São Paulo and Paraná, so we expect a major effect if it happens. The situation has changed enormously in the past 2 weeks. And here, there is a comparison of the curve of the future of sugar in Brazilian reals. The dotted curve is from 1 month ago, so the light green curve.

Speaker #2: Financeiros e cuja produção. Bom, falando um pouco do mercado de açúcar, né, o balanço mundial de oferta e demanda para esse ano, nós estamos tendo superávit aqui, segundo a Datagro, né, posição deles de agosto 26.

[Company Representative] (Jalles Machado): Financeiros e custeio de produção. Falando um pouco do mercado de açúcar, o balanço mundial de oferta e demanda, para esse ano, nós estamos tendo um superávit, aqui segundo a Datagro, posição desde agosto de 2026, e para o ano que vem já apontando 1.6 milhões de déficit. Nós estamos vendo a curva de estoque e consumo, que está nos níveis mais baixos da série histórica desde 2014, 2015. Nas últimas duas semanas, houveram algumas revisões de algumas casas, aumentando ainda mais esse déficit na 2026, 2027, tem casas chegando com 3 a 4 milhões de toneladas de déficit para o ano que vem. Segundo os números da Datagro, a gente tem uma redução de produção na Índia de 1.3 milhão de toneladas, Tailândia caindo quase 2 milhões de toneladas, União Europeia tendo uma queda substancial de 16.6 para 14.1 milhões de toneladas.

Speaker #1: Because of El Niño, affecting all the countries in Asia, which may also affect Center-South region, with rain, abundant rainfall expected in the state of São Paulo, and Paraná, so we expect a major effect if it happens.

Speaker #2: E para o ano que vem, já apontando 1,6 milhão de déficit, né? E nós estamos vendo a curva aqui de estoque e consumo, está nos níveis mais baixos aí da série histórica desde 2014 e 2015.

Speaker #2: E, nas últimas duas semanas aí, houveram algumas revisões de algumas casas, aumentando ainda mais esse déficit aí na 26 e 27. Tem casa chegando aí com 3 a 4 milhões de toneladas de déficit pro ano que vem.

Speaker #1: So the situation has changed. The normally in the past 2 weeks and here, there is a comparison of the curve of the future of sugar in Brazilian Rios the dotted curve, it's from 1 month ago, so the light green curve.

Speaker #2: Segundo os números da Datagro, a gente tem uma redução de produção aí na Índia de 1,3 milhão de toneladas, Tailândia caindo quase 2 milhões de toneladas, União Europeia tendo uma queda substancial, né, de 16,6 para 14,1 milhões de toneladas, problema grande de produtividade lá, redução de área e produtividade da beterraba; China subindo 200 mil toneladas, né, pouca coisa, e o Centro-Sul subindo 300 mil toneladas, né. Então, com todo esse cenário de El Niño, né, que afeta esses países da Ásia, e também pode ser que afete aqui o Centro-Sul, né, com chuvas antecipadas e abundantes aí no estado de São Paulo e Paraná, que São Paulo é a maioria da produção, né, então faz efeito grande caso ocorra.

Speaker #1: The other curve is a 1 week old curve. And comparing both curves there have been over 15% increase in prices, then 13.5, 12 in October 2027 and March 2028 on, there has been an increase as it were at a better level.

Operator: The other curve is a one-week-old curve, comparing both curves, there have been over 15% increase in prices. Then 13.5%, 12% in October 2027 and March 2028 on, there has been an increase as it were at a better level. At the same time, there have been a reverse in speculating funds, which are constantly used by the market to measure this position of purchasing or selling, supply or demand. So on the week of 4 August, as a reference date, they were trading at 91,000 contracts sold. One week later, 25,000 purchased contracts or bought contracts, or 116,000 contracts. The second-highest weekly change in history since when the data started being collected. A quick reversion, very significant one that we observed in recent weeks. It shows an improved landscape.

Rodrigo Penna de Siqueira: The other curve is a one-week-old curve, comparing both curves, there have been over 15% increase in prices. Then 13.5%, 12% in October 2027 and March 2028 on, there has been an increase as it were at a better level. At the same time, there have been a reverse in speculating funds, which are constantly used by the market to measure this position of purchasing or selling, supply or demand. So on the week of 4 August, as a reference date, they were trading at 91,000 contracts sold. One week later, 25,000 purchased contracts or bought contracts, or 116,000 contracts. The second-highest weekly change in history since when the data started being collected. A quick reversion, very significant one that we observed in recent weeks. It shows an improved landscape.

[Company Representative] (Jalles Machado): Problema grande de produtividade lá, redução de área e produtividade da beterraba. China subindo 200 mil toneladas, pouca coisa, e o Centro-Sul subindo 300 mil toneladas. Com todo esse cenário de El Niño, que afeta esses países da Ásia, e também pode ser que afete o Centro-Sul, com chuvas antecipadas e abundantes no estado de São Paulo e Paraná, que São Paulo é a maioria da produção, então faz um efeito grande caso ocorra. O cenário mudou muito nas últimas duas semanas. Aqui a gente fez até um comparativo da curva dos futuros de açúcar, em reais, com polarização. A curva pontilhada inferior é de um mês atrás, essa pontilhada verde mais claro. A de cima, pontilhada, é de uma semana atrás. Comparando o último mês, nos primeiros vértices aqui, a gente teve mais de 15% de aumento no preço.

Speaker #1: At the same time, there have been a reverse in a speculating funds which are constantly used by the market to measure this position of purchasing or selling supply or demand, so in the week of 4 of August, as a reference date, they were trading at 91,000 contracts, so 1 week later, 25,000 purchased contracts, so bought contracts, or 16,000, 116,000 contracts.

Speaker #2: Então, o cenário mudou muito, né, nas últimas duas semanas, né, e aqui a gente fez até um comparativo da curva dos futuros de açúcar, em reais, com polarização. A curva pontilhada inferior é de um mês atrás, essa pontilhada verde mais clara.

Speaker #1: The second highest weekly change in history since when the data started being collected the quick reversion, very significant one that we observed in recent weeks.

Speaker #2: E a de cima pontilhada é de uma semana atrás, e comparando no último mês, nos primeiros vérices aqui, a gente teve mais de 15% de aumento no preço, né. Aí na 27, aí 13,5, 14,5, e 12 no outro 27. Aí março, 28 pra frente, ela teve aumento maior porque ela já estava num patamar melhor.

Speaker #1: It shows an improved landscape. The trend couldn't be really explained because the market was indicating deficit for the upcoming year, but with prices which were loose and very low, well, now we can understand because the foundations are really impacting the market.

Operator: The trend couldn't be really explained because the market was indicating deficits for the upcoming year, but with prices which were loose and very low.

Rodrigo Penna de Siqueira: The trend couldn't be really explained because the market was indicating deficits for the upcoming year, but with prices which were loose and very low.

[Company Representative] (Jalles Machado): Na 27, 13.5, 14.5 e 12, no outubro 27, em março 28 para frente, ela teve um aumento maior, porque ela já estava num patamar melhor. Junto com isso, nós tivemos uma reversão dos fundos, os fundos especuladores, que o mercado usa muito para medir essa força compradora ou vendedora, que eles acabam antecipando os movimentos. Na semana 04 de agosto, data de referência, eles estavam 91 mil contratos vendidos. 11 de agosto, uma semana depois, passaram a 25 mil contratos comprados. Então, um delta de 116 mil contratos de reversão, que foi a segunda maior variação semanal da história, desde que tem esse dado. É uma reversão rápida e muito importante que a gente viu no mercado nas últimas semanas. Isso dá uma melhorada do cenário, que é aquilo que a gente falava.

Rodrigo Penna de Siqueira: Well, now we can understand because the foundations are really impacting the market. Now, speaking about ethanol, last year there was a demand of 33.6 million liters. This year, we are growing 1.85 more of corn ethanol. These are data from FGV Agro from 26 August. Sugarcane, 3.7 billion increase. If we add up both in terms of supply, that would be 4.6 million liters, which will be mitigated by E30 for four months and eight months of E32, which add up 1 billion liters growth of auto cycle, 680 million liters. And inventory levels. The stocks were very low last year, much lower than the history, therefore, we expected to have a difference in inventories through the crop season. But compared over the same basis last year, we are talking about 3.4 million liters more that the market has to sell during this year.

Speaker #2: E, junto com isso, nós tivemos uma reversão dos fundos. Os fundos especuladores, né, que o mercado usa muito pra medir essa força compradora ou vendedora, né, que eles acabam antecipando os movimentos. Na semana de 4 de agosto, data de referência, eles estavam 91 mil contratos vendidos. Em 11 de agosto, uma semana depois, passaram a 25 mil contratos comprados. Então, um delta de 116 mil contratos de reversão, que foi a segunda maior variação semanal da história desde que tem esse dado.

Speaker #1: Now, speaking about ethanol, last year there was a demand of 33.6 million liters this year we are growing 1.85 more of corn ethanol these are data from FGA from August 2026.

Speaker #1: Sugarcane, 3.7 billion increase. If we add up both, in terms of supply there would be 4.6 million liters which will be mitigated by E30 for 4 months, and 8 months of E32 which add up 1 billion liters growth of auto cycle, 680 million liters.

Speaker #2: Então é uma reversão rápida e muito importante aí que a gente viu no mercado nas últimas semanas. Então, isso dá uma melhorada no cenário, né, que é aquilo que a gente falava, né, a tendência a gente não conseguia muito explicar, com o mercado apontando déficit pro ano que vem e o preço tava tão frouxo, né, tão pra baixo.

Speaker #1: And inventory levels the stocks were very low last year, much lower than the history, therefore we expect it to have a difference in inventories through the crop season.

[Company Representative] (Jalles Machado): A tendência, a gente não conseguia muito explicar, com o mercado apontando um déficit para o ano que vem, e o preço estava tão frouxo, tão para baixo. Agora começam os fundamentos a afetar o mercado. Quando a gente vai para o etanol, no ano passado, nós tivemos uma demanda de 33.6 bilhões de litros. Este ano, nós estamos crescendo 1.85 a mais de etanol de milho. Isso aqui são dados da FG/A de agosto de 2026. De cana, nós estamos tendo um aumento de 3.7 billion.

Speaker #2: Então agora começa os fundamentos a afetar o mercado. Quando a gente vai pro etanol, a gente no ano passado, né, nós tivemos uma demanda aí de 33,6 bilhões de litros, né, esse ano nós estamos crescendo 1,85 a mais de etanol de milho, isso aqui são dados da FGA de agosto 26, de cana nós estamos tendo aumento de 3,7 bi, então somando esses dois aumentos de oferta seriam 4,6 bilhões de litros, que vão ser vamos falar mitigados, né, pelo E30 durante 4 meses e 8 meses o E32, que soma aqui praticamente 1 bilhão de litros, o crescimento do ciclo Otto 680 milhões de litros, e os estoques que passaram, os estoques de passagem o ano passado passaram muito baixo, muito abaixo do normal, do histórico, então ele deve se imagina uma recomposição de estoque aí na passagem de safra, mas mesmo assim comparado na mesma base do ano anterior nós estamos falando de 3,4 bilhões de litros a mais que o mercado precisa vamos falar assim vender durante esse ano, e a gente tá assistindo é dos motivos que o etanol ficou bem pressionado nesse início de safra, e porque nós vamos ter que fazer uma paridade com certeza abaixo do ano passado, que a gente fez uma paridade média de 68%, esse ano ela vai ter que ser segundo o próximo gráfico da SA 62% na média, mas tem muitas casas falando em 64%, e olhando aqui os ano a curva, né, que a SA atualiza, né, semanalmente essa aqui foi da última semana, ela tá prevendo etanol aqui a preço bruto em São Paulo, né, saindo de 2,58 que chegou aqui em agosto, chegou até 2,50, 2,55, chegou a ser vendido etanol e fazendo uma reação daqui pra frente, que que aconteceu nos últimos dias, né, que isso é da semana passada, São Paulo já está 2,75, então deu uma puxada grande, né, no mercado de São Paulo, então já antecipou esse movimento e muito em função do aumento do preço de açúcar, né, muitas usinas mudando o mix todo pra açúcar, né, com essa reação do preço em Nova York.

Speaker #1: But compared over the same basis last year we were talking about 3.4 million liters more that the market has to sell during this year.

Speaker #1: And this is why ethanol was subject to so much pressure at the beginning of the crop year. We will have to have a parity below that of last year.

Rodrigo Penna de Siqueira: This is why ethanol was subject to so much pressure at the beginning of the crop year. We will have to have a parity below that of last year. It was 68% last year. This year it will probably be, as you're going to see, at the range of 62% on average, but there are many talking about 64% on average. Relying on the curve presented by ESALQ, which is updated weekly. This one was from last week. It's estimated ethanol at gross price going from 258 in August up to 250/255 in August, and starting to pick up from now on. What has happened in recent days? São Paulo is at 2.75, so it has pulled up the prices in the market of São Paulo, anticipating the movement because of increase in sugar prices.

Speaker #1: It was 68% last year, this year it will probably be as you're going to see at the range of 62% on average. But there are many talking about 64% on average.

[Company Representative] (Jalles Machado): Somando esses dois aumentos de oferta, seriam 4.6 bilhões de litros, que vão ser mitigados pelo E30 durante 4 meses e 8 meses o E32, que soma aqui praticamente 1 bilhão de litros, o crescimento do Ciclo Otto, 680 milhões de litros, e os estoques de passagem o ano passado passaram muito abaixo do normal, do histórico, então se imagina uma recomposição de estoque na passagem de safra. Mas mesmo assim, comparado na mesma base do ano anterior, nós estamos falando de 3.4 bilhões de litros a mais, que o mercado precisa vender durante este ano. É um dos motivos que o etanol ficou bem pressionado nesse início de safra porque nós vamos ter que fazer uma paridade, com certeza, abaixo do ano passado.

Speaker #1: Relying on the curve presented by SCIA which is updated weekly, this one was from last week. It's estimated ethanol at gross price going from 258 in August up to 250, 55 in August, and starting to pick up from now on.

Speaker #1: What has happened in recent days, São Paulo is at 2.75, so it has pulled up the prices, and the market of São Paulo anticipating the movement.

Speaker #1: Because of increased in sugar prices. Many plants are changing the mix because of the reactions of prices in New York. Now, parity in August which was 57% is expected to grow up gradually and now we anticipate and looking from hindsight, it seems that consumers now are really buying more and more ethanol.

Rodrigo Penna de Siqueira: Many plants are changing the mix because of the reactions of prices in New York. Now, parity in August, which was 57%, is expected to go up gradually. Now we anticipate, and looking from hindsight, it seems that consumers now are really buying more and more ethanol. We know there is some level or some period of delay from the beginning of price drop at a parity level that encourages consumption. It takes a while for consumers to really embark on buying more and more ethanol. Now it is there, and we can have an improvement in prices. Another important thing to mention before I go into the next slide, and it was shared in the news. There is a project, PLP 114, which was being discussed in the Congress in Brazil. Last week it was approved in the Congress and Senate.

[Company Representative] (Jalles Machado): Quem fez uma paridade média de 68%, este ano ela vai ter que ser, segundo o próximo gráfico da SCA, 62% na média, mas tem muitas casas falando em 64%. Olhando aqui, usando a curva que a SCA atualiza semanalmente, essa aqui foi da última semana, ela está prevendo um etanol a preço bruto em São Paulo, saindo de BRL 2.58, que chegou aqui em agosto, chegou até BRL 2.50, BRL 2.55, chegou a ser vendido o etanol, e fazendo uma reação daqui para frente. O que aconteceu nos últimos dias? Isso é da semana passada, São Paulo já está BRL 2.75. Deu uma puxada grande no mercado de São Paulo, já antecipou esse movimento e muito em função do aumento do preço de açúcar. Muitas usinas mudando o mix todo para açúcar com essa reação do preço em Nova York.

Speaker #1: We know there is some level or some period of delay from the beginning of price drop at a parity level that encourages consumption, but it takes a while for consumers to really embark on buying more and more ethanol.

Speaker #1: But now it is there. And we can have an improvement in prices. Another important thing to mention before I go into the next slide and it was shared in the news, there is a project, PLT 114, which was being discussed in the Congress in Brazil, last week it was proved in the Congress and Senate still waiting for the approval or veto of President Lula da Silva.

Rodrigo Penna de Siqueira: Still waiting for the approval or veto of President Lula da Silva, but it is expected to pass. This PLP 114 bill will give the same incentive that was given to gasoline, to ethanol, and it was 44 cents of subsidies to gasoline for ethanol. So for gasoline A, right? Gasoline C, which is used for consumption, had 32% of ethanol, 68% of gasoline. That would be 0.68% of the amount, which means 30 cents. This is what passed, and it is going to be retrospectively to May, and as long as there is subsidies to gasoline, there is going to be provided also to ethanol. It is good news. It would not be acceptable, of course, to provide incentives to fossil fuel and simply have renewable fuel out of that receiving of subsidy. That is going to be very important for the market of ethanol and biofuel.

Speaker #1: But it's expected to pass. This PLT 114 bill will give the same incentive that was given to gasoline to ethanol. And it was 44 cents of subsidies to gasoline for ethanol so for gasoline type A, right?

Speaker #2: E a paridade em agosto, que está em 57%, você imagina que ela vai subindo aqui gradualmente, e a gente está enxergando agora com muito atraso, né? Parece que, de fato, o consumidor agora passou a consumir mais etanol.

[Company Representative] (Jalles Machado): A paridade em agosto, que está 57%, se imagina que ela vai subindo aqui gradualmente e a gente está enxergando agora, com muito atraso, parece que, de fato, o consumidor agora passou a consumir mais etanol. A gente sabe que sempre tem uma inércia, um delay, entre o início da baixa de preços do etanol com uma paridade que fomente, incentive o consumo, só que demora o consumidor a entrar nesse consumo mais forte de etanol e agora entrou. Então nós estamos tendo uma melhora nos preços que eu acabei de falar. Uma coisa importante, antes de passar para o próximo slide, foi noticiado aí, tem um projeto, o PLP 114/2026, que estava sendo discutido na Câmara há muito tempo. Semana passada, passou tanto na Câmara como no Senado. Falta a sanção ou veto do presidente, mas tudo indica que vai ser sancionado.

Speaker #2: A gente sabe que sempre tem uma inércia, um delay, né, entre o início da baixa de preço do etanol com uma paridade que fomente, que incentive o consumo. Só que demora para o consumidor entrar nesse consumo mais forte de etanol, e agora entrou, então nós estamos tendo uma melhora nos preços, como eu acabei de falar. Uma coisa importante, antes de passar para o próximo slide: foi noticiado aí, tem um projeto, o PLP 114, que estava sendo discutido na Câmara há muito tempo. Semana passada, passou tanto na Câmara como no Senado. Falta a sanção ou veto do presidente, mas tudo indica que vai ser sancionado.

Speaker #1: But gasoline C, which is used for consumption, had a 32% of ethanol, 68 of gasoline. So that would be 0.68% of the amount, which means 30 cents.

Speaker #1: This is what passed and it's going to be retrospectively to May and as long as there is subsidies to gasoline, there is going to be provided also to ethanol.

Speaker #1: It's good news. It would not be acceptable of course to provide incentives to fossil fuel and simply have renewable fuel out of that receiving of subsidy.

Speaker #1: So that's going to be very important for the market of ethanol and biofuel. But even so, our prices are lagging behind. The price of gasoline A, even with the 44 cents, and Petrobras increased it by 48, but there is still a huge gap that should be passed through to prices.

Speaker #2: E isso esse PLP 114, ele vai dar o mesmo incentivo que deu pra gasolina pro etanol, como foi dado 44 centavos de subsídio pra gasolina, no caso do etanol, como foi dado pra gasolina A, e a gasolina C que é que vai pro consumo, tem 32% de etanol e 68% de gasolina, então nós vamos receber 0,68% desse montante que vai dar por volta de 30 centavos, isso foi o que foi aprovado e vale retroativo a maio, e depois até enquanto houver o subsídio pra gasolina, terá pro etanol também, então é uma boa notícia, né, que seriam é contrassenso, absurdo dar incentivo pra combustível fóssil, né, e deixar o combustível renovável de fora, né, então a gente tá tendo essa aprovação aí, vai ser importante aí pro mercado de etanol de biocombustíveis, e lembrando que ainda assim nós estamos muito defasados, né, o preço da gasolina A, mesmo com os 44 centavos que o governo deu, a Petrobras subiu 48, mas ainda existe uma defasagem grande pra ser repassada pros preços que a Petrobras segue segurando isso e não deixa de prejudicar aí momento bom que seria pro setor de etanol.

[Company Representative] (Jalles Machado): Esse PLP 114 vai dar o mesmo incentivo que deu para gasolina para o etanol. Como foi dado BRL 0.44 de subsídio para gasolina, no caso do etanol, como foi dado para gasolina A, e a gasolina C, que é a que vai para o consumo, tem 32% de etanol e 68% de gasolina. Então nós vamos receber 0.68% desse montante, que vai dar por volta de BRL 0.30. Isso foi o que foi aprovado e vale retroativo a maio, e depois enquanto houver o subsídio para gasolina, terá para o etanol também. Então a boa notícia, que é um contrassenso, um absurdo dar incentivo para um combustível fóssil e deixar o combustível renovável de fora. Então a gente está tendo essa aprovação e vai ser importante para o mercado de etanol, de biocombustíveis. Lembrando que, ainda assim, nós estamos muito defasados.

Rodrigo Penna de Siqueira: Even so, our prices are lagging behind. The price of gasoline A, even with the 44 cents, and Petrobras increased it by 48, but there is still a huge gap that should be passed through to prices. Petrobras is still controlling that, and of course, it impacts negatively for us at the ethanol market. This bill of law, PLP 114, as I told you, it is going to be retrospectively amounted for since May, and the government has also agreed the credits of tax up to BRL 750 million that the crushing plants have can be compensated for a while. Still waiting for regulation, but that would be one more initiative that would be helpful to kind of offset taxes. Operational highlights. Harvest area was 2.5% higher than last year, crushing 10% higher as well because of productivity, which is 7.4% higher than the same period last year.

Speaker #1: Petrobras is still controlling that and of course it impacts negatively for us at the ethanol market. This bill of law, PLT 114, as I told you, it is going to be retrospectively amounted for since May and the government has also agreed the credits of tax up to 750 million that the crushing plants have can be consecrated compensated for a while.

Speaker #1: It's still waiting for regulation, but that would be one more initiative that would be helpful to kind of offset taxes. Operational highlights. Harvest area was 2.5% higher than last year.

Speaker #1: Crushing 10% higher as well because of productivity which is 7.4% higher than the same period last year. Jalles closed with 99 tons per hectare.

[Company Representative] (Jalles Machado): O preço da gasolina A, mesmo com os BRL 0.44 que o governo deu, a Petrobras subiu BRL 0.48, mas ainda existe uma defasagem grande para ser repassada para os preços, que a Petrobras segue segurando isso, e não deixa de prejudicar um momento bom que seria para o setor de etanol. Esse PLP 114, como eu falei, vai vir desde quando fez da gasolina em maio e vai para frente. Além disso, o governo permitiu que os Créditos de PIS e COFINS, até um montante de BRL 750 milhões que usinas tiverem, também podem ser compensados por um período. Ainda falta regulamentar, mas tem esse dispositivo também que vai poder compensar com outros tributos.

Rodrigo Penna de Siqueira: Jalles closed with 99 tons per hectare. Otávio Lage is 90 per hectare, and Santa Vitória, 79 tons per hectare. That was the yield. TRS per hectare, here we can see 88% increase. Median TRS, 1.3. A production mix, which was ethanol-oriented. Because sugar was not performing well, we had a more ethanol-oriented mix, changed our hedge position when sugar was at 1,600, 1,700, going more into an ethanol-oriented mix, and it was the right time, so to speak, of adjusting this position for our new mix that we are going to show you. From Q1 on, we have 100% of sugar for the year is subject to hedge, all fully hedged for the current year, crop 2026-2027. Average age of sugarcane, very similar to what we have, 2.6 years. Jalles and Santa Vitória, lower, and Otávio Lage is somewhat higher than last year. Here, commercial highlight.

Speaker #1: Otavo Largis 90 per hectare. Incentive Victoria 17,9 tons per hectare. That was the yield. TRS per hectare, here we can see 88% increase. Median TRS 1.3.

Speaker #2: Esse PLP 114, ele, como eu falei, vai vir desde quando fez da gasolina, em maio, e vai pra frente. Além disso, o governo permitiu que os créditos de PIS e COFINS, até o montante de R$750 milhões que as usinas tiverem, também podem ser compensados por período. Ainda falta regulamentar, mas tem esse dispositivo também que vai poder compensar com outros tributos.

Speaker #1: And a production mix which was ethanol oriented because sugar was not performing well. We had a more ethanol oriented mix changed our hatch position when sugar was at 1,600, 1,700, going more into a ethanol oriented mix and it was the right time so to speak of adjusting this position for our new mix that we are going to show you.

Speaker #2: Bom, indo pros destaques operacionais, a gente teve uma área colhida de quase 35 mil hectares, 2,5% acima do ano passado; uma moagem 10% a mais, em função de uma produtividade que está 7,4% maior que no mesmo período do ano passado. A unidade Jalles fechou o trimestre com 99 toneladas por hectare praticamente, a unidade Otávio Lage, 90 toneladas por hectare, e a Santa Vitória com 79 toneladas por hectare.

[Company Representative] (Jalles Machado): Bom, indo para os destaques operacionais, a gente teve uma área colhida de quase 35 mil hectares, 2.5% acima do ano passado, uma moagem de 10% a mais, em função de uma produtividade que está 7.4% a maior que o mesmo período do ano passado. A Unidade Jalles Machado fechou o trimestre com 99 toneladas por hectare, praticamente. A Unidade Otávio Lage, 90 toneladas por hectare e a Unidade Santa Vitória com 79 toneladas por hectare. A gente fechou com pH de 10.7, 9% a mais que a tonelada de ATR por hectare, uma TR média de 119 quilos no trimestre e um mix muito alcooleiro.

Speaker #1: From the first quarter on, we have 100% of sugar for the year is subject to hatch. All fully hatched. For the current year, crop 26, 27.

Speaker #1: Average age of sugarcane very similar to what we have, 2.6 years. Jalles and the Santa Victoria lower and Otavo Largis somewhat higher than last year.

Speaker #2: A gente fechou com TH de 10,7, né, 9% a mais que a tonelada de ATR por hectare, ATR médio de 119 quilos no trimestre, e o mix muito alcooleiro, né, porque o açúcar vinha bem pior. A gente até passou a ter mix mais alcooleiro, até desfizemos a posição de hedge quando o açúcar estava ali em 1.600, porque a gente acabou 1.600, 1.700, passando pra movimento mais alcooleiro. E foi um momento interessante de ter ajustado essa posição pro nosso novo mix, né, que a gente vai mostrar à frente, né, que nós estamos, do primeiro tri pra frente, 100% do açúcar planejado, o açúcar que a gente tem pro ano, está hedgeado.

Speaker #1: Here, commercial highlight without considering the effects of hatch, significant decrease 26% in the average price of sugar. Ethanol had growth decrease rather of 12% in the price of all kinds of ethanol.

Rodrigo Penna de Siqueira: Without considering the effects of hedge, significant decrease, 26% in the average price of sugar. Ethanol had growth or a decrease, rather, of 12% in the price of all kinds of ethanol. That is a weighted average of all types, including hydrous and anhydrous. It started at 312, and it went down in May and June. In July, it went even lower, but in August it has recovered. It is back to 2.75 in São Paulo. We have sold less at the same quarter last year, only 35%, or rather 51% of our TRS, as opposed to 68 last year. Therefore, our ethanol inventories went up in our strategy of not selling ethanol when the prices are as low as we had. Of course, we still sell a little bit, but we really decrease the sales strategy. Sugar inventory is somewhat below the previous year.

[Company Representative] (Jalles Machado): O açúcar vinha bem pior, a gente até passou a ter um mix mais alcooleiro, até desfizemos a posição de hedge quando o açúcar estava ali em 1600, 1700, porque a gente acabou passando para um movimento mais alcooleiro e foi um momento interessante de ajustado essa posição para o nosso novo mix, que a gente vai mostrar à frente, que nós estamos do primeiro tri para frente, 100% do açúcar que a gente tem para o ano, está arrediado no ano atual, nessa safra 2026/2027. A idade média do canavial, muito em linha com o ano anterior, 2.7 anos. Jalles e Santa Vitória, uma idade média mais baixa que o ano anterior, e Otávio Lage, um pouco mais alta que o ano anterior. Açúcar, aqui foi o mercado de venda, sem considerar os efeitos do hedge.

Speaker #1: That's the weighted average of all types including hadros and anhydrous. It's noted at 312 and it went down in May and June. In July it went either lower but in August it has recovered it's back to 2.75 in São Paulo.

Speaker #1: We have sold less than the same quarter last year only 35% or rather 51% of our TRS as opposed to 68 last year therefore our ethanol inventories went up in our strategy of not selling ethanol when the prices are as low as we had.

Speaker #2: No ano atual, nessa safra 26/27, a idade média do canavial está muito em linha com o ano anterior, 2,7 anos. Jalles e Santa Vitória com idade média mais baixa que o ano anterior, e Otávio Lage, pouco mais alta que o ano anterior.

Speaker #1: Of course we still sell a little bit but we really decrease the sales strategy. Sugar inventories somewhat below the previous year the first quarter was very much ethanol oriented as we told you.

Speaker #2: Açúcar, né, aqui foi o mercado de venda, né, sem considerar os efeitos do hedge. Então, teve uma queda substancial, né, de 26% no preço médio de açúcar, e o etanol teve uma queda de 12% no preço de todos os etanóis, né, a média ponderada na venda de todos os etanol anidro e hidratado. E a gente viu esse preço, né, caindo, começou a abrir o Q3 em 12, e veio caindo aqui em maio/junho.

[Company Representative] (Jalles Machado): Então, teve uma queda substancial de 26% no preço médio de açúcar e o etanol teve uma queda de 12% no preço de todos os etanóis, a média ponderada na venda de todos, etanol anidro, hidratado. A gente viu esse preço caindo, começou abril a BRL 3,12 e veio caindo aqui em maio, junho. Agora, como eu comentei, em julho caiu mais e agosto tem recuperado, já está em São Paulo nesse patamar de BRL 2,75. Nós comercializamos menos do que o mesmo trimestre ano passado. A gente comercializou só 51% do ATR produzido, foi comercializado, contra 68% o ano passado. Com isso, os estoques de etanol subiram bastante, na estratégia da companhia de não vender etanol num momento de preço tão baixo como estava o mercado. Não é deixar de vender 100%, mas a gente diminui bastante a velocidade de venda.

Rodrigo Penna de Siqueira: The first quarter was very much ethanol-oriented, as we told you. Now, financial highlights. EBIT, EBITDA, they are adjusted here. In addition to the adjusted that we have always done with equities and biological assets, we have considered the settled hedge for an exchange in sugar that we do, sugar in dollar and foreign exchange, of course, transforming that into Brazilian reals. But that applies only to sugar. In the quarter, EBIT margin with a settlement of hedge was 19.6%, BRL 67 million, as opposed to BRL 27 million previous year. Adjusted EBITDA, in turn, EBITDA, even though there was lower amount of revenue, it was aligned with a much higher margin of volume than previous year, 79.1. Net income had a -74 million impact, as opposed to -14.

Rodrigo Penna de Siqueira: The Q1 was very much ethanol-oriented, as we told you. Now, financial highlights. EBIT, EBITDA, they are adjusted here. In addition to the adjusted that we have always done with equities and biological assets, we have considered the settled hedge for an exchange in sugar that we do, sugar in dollar and foreign exchange, of course, transforming that into Brazilian reals. But that applies only to sugar. In the quarter, EBIT margin with a settlement of hedge was 19.6%, BRL 67 million, as opposed to BRL 27 million previous year. Adjusted EBITDA, in turn, EBITDA, even though there was lower amount of revenue, it was aligned with a much higher margin of volume than previous year, 79.1. Net income had a -74 million impact, as opposed to -14.

Speaker #1: Now financial highlights. EBIT, EBITDA, they are adjusted here. In addition to the adjusted that we've always done with equities and biological assets, we've considered the settled hatch for an exchange in sugar that we do of sugar in dollar and for an exchange of course transforming that into Brazilian reals but that applies only to sugar.

Speaker #2: Agora, como eu comentei em julho, caiu mais, e agosto tem recuperado aí, já tá em São Paulo nesse patamar de 2,75. Nós comercializamos menos do que o mesmo trimestre ano passado, né, a gente comercializou só 35% do, aliás, desculpa, só 51% do ATR produzido foi comercializado contra 68% o ano passado, e com isso os estoques de etanol subiram bastante, na estratégia da companhia de não vender etanol num momento de preço tão baixo como tava o mercado, né, não é deixar de vender 100%, mas a gente diminui bastante a velocidade de venda.

Speaker #1: In the quarter EBIT margin we've settlement of hatch was 19.6%, 67 million as opposed to 27 million previous year. Adjusted EBITDA in turn EBITDA even though there was lower amount of revenue it was aligned with a much higher margin of volume than previous year.

Speaker #1: 79.1. Net income had a negative impact of 74 million as opposed to 14 negative but if we exclude non-cash effect MTM, biological assets, we end up getting to better cash earnings despite the challenging price landscape maintaining inventories we still had better results than last year.

Speaker #2: Estoque de açúcar pouco abaixo do ano, que a gente tem esse primeiro tri, foi trimestre muito alcooleiro, como a gente mostrou há pouco. Indo pros destaques financeiros, aqui, gente, tanto o EBIT como o EBIDAR, eles estão ajustados além do ajuste que a gente sempre fez de biológico, equivalência patrimonial, ele também considerou os heads liquidados de açúcar e câmbio, que são que é o head que a gente faz da commodity, né, que a gente faz do açúcar em dólar e faz do câmbio, né, transformando isso em reais, mas é só referente ao próprio açúcar.

[Company Representative] (Jalles Machado): Estoque de açúcar um pouco abaixo do ano, que esse primeiro tri foi um trimestre muito alcooleiro, como a gente mostrou há pouco. Índices de saques financeiros, aqui, gente, tanto o EBIT como o EBITDA, eles estão ajustados. Além do ajuste que a gente sempre fez, biológico, equivalência patrimonial, ele também considerou os hedges liquidados de açúcar e câmbio, que é o hedge que a gente faz da commodity, que a gente faz do açúcar em dólar e faz o câmbio, transformando isso em reais, mas é só referente ao próprio açúcar. Então, a gente teve no trimestre uma margem EBIT, com a liquidação de hedge, de 19,6% e BRL 67 milhões, contra BRL 27 milhões no ano anterior. O EBITDA ajustado, mesmo fazendo um volume muito menor de receita, ele ficou em linha com uma margem bem maior que o ano passado, 79,1.

Rodrigo Penna de Siqueira: But if we exclude non-cash effect, MTM, biological assets, we end up getting to better cash earnings despite the challenging price landscape, maintaining inventories. We still had better results than last year, and this is thanks to the hedge, because theoretically, it should be worse, even though we had better yields. But the price conditions were much worse. So hedging was essential in the results for the quarter. Why had our MTM been so negative in the quarter and affected our results and net profit? Hedge and derivatives was -74 million, as opposed to +231 positive in the same period last year. Let me make a highlight here, especially the hedge of indexers. 80% of our debts were issued with IPCA plus, and the debts were swapped to CDI.

Speaker #1: And this is thanks to the hatch. Because theoretically it should be worse. Even though we had better yields but the price conditions were much worse so hatching was essential in the results for the quarter.

Speaker #2: Então a gente teve aí no trimestre, uma margem EBIT com a liquidação de head de 19,6% e 67 milhões contra 27 milhões no ano anterior, e o EBIDAR ajustado mesmo fazendo volume muito menor de receita, né, ele ficou em linha aí com uma margem bem maior em volume em linha, mas uma margem muito maior que o ano passado, né, 79,1.

Speaker #1: One had our MTM been so negative in the quarter and affected our results and net profit. Hatch and derivatives was negative in 74 million as opposed to 231 positive in the same period last year.

Speaker #1: Let me make a highlight here. Especially the hatch of indexers. 80% of our debts were issued with IPCA plus and the debts were swapped to CDI.

Speaker #2: O lucro líquido teve efeito negativo, né, porque ele deu R$ 74 milhões, contra R$ 14 milhões, mas quando a gente exclui os efeitos não caixa, né, tanto MTM biológico, a gente acaba chegando no lucro caixa – que foi melhor esse ano, mesmo com cenário muito mais desafiador de preço, faturando menos porque a gente reteve mais estoques. A gente ainda teve resultado melhor que no ano passado, isso muito em função do hedge, porque na teoria deveria ser pior, né, apesar de ter uma produtividade melhor, mas as condições de preço estão muito piores, então o hedge foi muito importante nesse resultado do trimestre.

[Company Representative] (Jalles Machado): O lucro líquido teve um efeito negativo, que ele deu BRL 74 milhões contra BRL 14 milhões, mas quando a gente exclui os efeitos não caixa, tanto MTM, biológico, a gente acaba chegando no lucro caixa, foi melhor esse ano, mesmo com cenário muito mais desafiador de preço, faturando menos, porque a gente reteve mais estoques, a gente ainda teve um resultado melhor que o ano passado. Isso muito em função do hedge, porque na teoria deveria ser pior. Apesar de ter uma produtividade melhor, mas as condições de preço estão muito piores. Então, o hedge foi muito importante nesse resultado do trimestre. Aqui, falando um pouco, por que esse MTM foi tão negativo no trimestre, e afetando o nosso resultado, o lucro líquido? O hedge derivativos teve um MTM negativo em BRL 74 milhões, contra BRL 231 milhões positivo na mesma época do ano passado.

Speaker #1: With the opening of curves that you can see here on the left we can see the curves of NTNB from March fourth quarter 26 to the first quarter curves got separated here in one two year period 100 BPS this is exactly the impact that has accounted for this 50 million MTM but this is the debt we have with 10 year maturity average maturity price of five years.

Rodrigo Penna de Siqueira: With the opening of curves that you can see here on the left, we can see the curves of NTN-B from March Q4 2026 to the first quarter. Curves got separated here in a one, two-year period, 100 bps. This is exactly the impact that has accounted for this BRL 50 million MTM. But this is the debt we have with 10-year maturity average, maturity price of five years. This is going to be paid through all time, but we can also expect the curves to get closer. But that is a historical highs for this variation of yield curves really, because since the end of the government of President Dilma Rousseff. Well, in terms of hedge, what is ahead of us?

Rodrigo Penna de Siqueira: With the opening of curves that you can see here on the left, we can see the curves of NTN-B from March Q4 2026 to the Q1. Curves got separated here in a one, two-year period, 100 bps. This is exactly the impact that has accounted for this BRL 50 million MTM. But this is the debt we have with 10-year maturity average, maturity price of five years. This is going to be paid through all time, but we can also expect the curves to get closer. But that is a historical highs for this variation of yield curves really, because since the end of the government of President Dilma Rousseff. Well, in terms of hedge, what is ahead of us?

Speaker #2: E aqui, falando um pouco, né, por que que esse MTM foi tão negativo no trimestre, né, e afetando nosso resultado, né, o lucro líquido. O hedge de derivativos teve MTM negativo em R$74 milhões contra R$231 milhões positivo na mesma época do ano passado. E aqui eu queria chamar atenção para o hedge de indexador. Indexador: nós temos, quase toda, 80% da dívida da companhia foi emitido a IPCA+, e essa dívida foi swapada pra CDI. E com a abertura das curvas, que a gente mostra no gráfico da esquerda, a abertura das curvas da NTNB, fechamento de março, né, do 4T26 pra esse primeiro tri. Então, as curvas abriram muito, né. No vértice de 1 ano e 2 anos aí, chegou a abrir 100 bps, né. Então, esse impacto acabou afetando essa marcação a mercado de R$50 milhões aqui, mas isso é nossa dívida que tem até 10 anos pra pagar, com prazo médio de 5, né, então isso vai ser pago ao longo do tempo, se a curva não voltar em algum momento, né. Mas a curva tá nos highs aí históricos, né, então teve assim no período da crise lá com o final do governo Dilma.

Speaker #1: This is going to be paid throughout time but we can also expect the curves to get closer. But that's a historical highs for this variation of yield curves really.

Speaker #1: Because since the end of the government of President Dilma Rousseff. Well in terms of hatch what is ahead of us. We have a volume fixed over our guidance of 85% but over the available volume for hatch we have 100% fixation on our crop 26, 27 of 2,500 reals which has 27% above the market from August 11.

[Company Representative] (Jalles Machado): Aqui eu queria chamar a atenção do hedge de indexador. Indexador, nós temos 80% da dívida da companhia, foi emitida IPCA+, e essa dívida foi swapada para CDI. Com a abertura das curvas, que a gente mostra no gráfico da esquerda, a abertura das curvas da NTN-B, fechamento de março, do Q4 2026 para esse primeiro T. Então, as curvas abriram muito, no veste de um ano e dois anos, chegou a abrir 100 bps. Então, esse impacto acabou afetando essa marcação a mercado de BRL 50 milhões aqui, mas isso é a nossa dívida, que tem até 10 anos para pagar, com prazo médio de cinco. Isso vai ser pago ao longo do tempo se a curva não voltar em algum momento. Mas a curva está nos high históricos. Teve assim no período da crise lá com o final do governo Dilma.

Rodrigo Penna de Siqueira: We have a volume fixed overall guidance of 85%, but over the available volume for hedge, we have 100% fixation on our crop 2026, 2027, 2,500 reals, which is 27% above the market from 11 August. For 2027, same range, 2.5. The market is at 1.1. We are 18% ahead. For 2029, with the recovery of the market, we are somewhat below. But 2029, we only have 24,000 tons fixed for that period. It has just been the beginning of setting the hedges based on our policy. The volume is still open for it. In 2028, 179,000 and 157,000 tons of 2026, 2027 of sugarcane already fixed by a hedge. As there had been inventory retention, there was an increase here, 2.3%. So adjusted EBITDA was below.

Speaker #1: For 2027 same range 2.5 the market's at 1.1 we are 18% ahead and for 28, 29 with the recovery of the market we are somewhat below but 28, 29 we only have 24,000 tons fixed for that period.

Speaker #1: It has just been the beginning of setting the hatches. Based on our policy so the volume is still open for it and in 27, 28 179,000 and 157,000 tons of 26, 27 of sugarcane already fixed by hatch.

Speaker #2: Bom, sobre head, a gente o que falta de agora em diante, né, a gente tem volume fixado sobre o nosso guidance, de 85%, mas sobre o volume disponível pra head nós estamos 100% fixado nesse na safra 26/27 até o final, e num patamar de quase 2.500 reais, que é 27% acima do mercado de 11 de agosto, para 27/28 também estamos nessa mesma faixa, 2.500 contra mercado, né, que depois dessa recuperação tá em 2.100, mas estamos 18% acima, e pra 28/29 com essa recuperação do mercado nós estamos até pouco abaixo, mas importante, na 28/29 nós temos só 24 mil toneladas fixadas, porque foi só o início da fixação seguindo a nossa política, né, então o volume quase todo ainda tá por fazer, e na 27/28 nós temos 180 mil toneladas, e esse restante da 26/27, 157 mil toneladas de cana de açúcar fixado.

[Company Representative] (Jalles Machado): Bom, sobre hedge, o que falta de agora em diante, a gente tem um volume fixado sobre o nosso guidance de 85%, mas sobre o volume disponível para hedge, nós estamos 100% fixados na safra 2026/2027 até o final, e num patamar de quase BRL 2,500, que é 27% acima do mercado de 11 agosto. Para 2027 e 2028, também estamos nessa mesma faixa, 2,500, contra o mercado, que depois dessa recuperação está em 2,100, mas estamos 18% acima. Para 2028 e 2029, com essa recuperação do mercado, nós estamos até um pouco abaixo, mas importante, na 2028 e 2029, nós temos só 24,000 toneladas fixadas, porque foi só o início da fixação seguindo a nossa política. Então o volume, quase todo, ainda está por fazer.

Speaker #1: As there had been inventory retention there was an increase here 2.3%. So adjusted EBITDA was below. Here we do not have settled hatch because the metrics that were defined to negotiate our debts does not considered settled hatch.

Rodrigo Penna de Siqueira: Here we do not have settled hedge because the metrics that were defined to negotiate our debts does not consider settled hedge. This is just regular hedge calculation. It increased because the EBITDA went down. We had lower revenues but have inventory ahead and the debt went up because we have higher inventory levels. BRL 1.6 billion is our cash covering all our maturities for 2029 and 2030, five-year period. in July, we reported an operation with long-term with IFC. It is an operation where we have BRL 300 million, $60 million. Long-term operation at a cost of SOFR MA plus, which was somewhat below CDI plus 0.6 per year. At a price level, which is very coherent with the levels that we captured in the market. All in, right? Production cost.

Speaker #1: So this is just regular hatch calculation. It's increased because the EBITDA went down. We had lower revenues but have inventory ahead and the debt went up because we have higher inventory levels.

Speaker #1: 1.6 billion is our cash covering all our materials for 29 and 30. Five year period. In July we reported an operation was long term with FC it's an operation where we had 300 million Brazilian reals 60 million dollars long term operation at a cost of so far month plus which was somewhat below CDI plus 0.6 per year.

[Company Representative] (Jalles Machado): Na 2027 e 2028, nós temos 180,000 toneladas e esse restante da 2026 e 2027, 157,000 toneladas de açúcar fixado. Endividamento, como a gente teve essa retenção do estoque, ele cresceu 2.3% e como a gente faturou pouco, o EBITDA ajustado também ficou abaixo. Aqui não está o hedge liquidado no EBITDA ajustado, porque as métricas que a gente definiu junto às nossas dívidas emitidas, não considera hedge liquidado, então aqui a gente fez com padrão normal. Então deu uma alta, porque o EBITDA caiu nesse trimestre, porque a gente faturou menos, mas reteve mais estoque para frente e a dívida também subiu um pouco em função dos estoques estarem mais altos. A gente passou o trimestre com caixa de BRL 1.64 bilhão, cobrindo os vencimentos até 2029 e 2030, com prazo médio de cinco anos, contra 5.2 de março de 2026.

Speaker #1: At a price level which is very coherent with the levels that we captured in the market. All in right. Production cost. Well cash vision we have a quarter which was somewhat distorted.

Rodrigo Penna de Siqueira: Well, cash vision, we have a quarter which was somewhat distorted, I have to say, because the cash understanding is all our recurring CapEx. As we had low revenues, we had very little depreciation. Therefore, it is a quarter that if we do not sell as previous years, it requires some adjustments to avoid distortion. This is why I always like to show cost of production in millions and in tons of TRS to show the difference between what we are producing and accounting for. We had 0.4% lower cost and 5.1% lower real over TRS. The cash understanding is getting more and more coherent as there are more periods coming to account for. It is fair at the end of the year. As a market practice, we always share with you the entering results.

Speaker #1: I have to say because the cash understanding is all our recurring our recurring capex. And as we had low revenues we add very little depreciation therefore it's a quarter that if we don't sell as previous years it requires some adjustments to avoid distortion and this is why I always like to show cost of production in millions and in tons of TRS to show the re the difference between what we we are producing and accounting for.

[Company Representative] (Jalles Machado): Em julho, a gente até divulgou como evento subsequente, nós desembolsamos uma operação de prazo longo com a IFC, que foi uma operação que a gente fez BRL 300 milhões, USD 60 milhões, com prazo longo e num custo que a gente tomou em SOFR mais que swapado, deu um pouco abaixo de CDI mais 0.6 ao ano. Então foi uma dívida num patamar de preço coerente com os patamares que a gente captou no mercado. Isso all-in, 0.6 all-in. Custo de produção. A visão caixa é um trimestre que fica muito distorcido. Por quê? Porque a visão caixa eu considero todo o recorrente que a gente faz. Todo o Capex recorrente que a gente faz, a gente considera. Como eu faturei pouco, eu adiciono pouca depreciação relativa ao faturamento.

Speaker #1: We had 0.4% lower cost and 5.1% lower real over TRS. The cash understanding is getting more and more coherent as there are more periods coming to account for.

Speaker #1: It is fair. At the end of the year but as a market practice we always share with you the interim results but it's important to really explain why because in the first quarter this number may get not as precise as expected.

Rodrigo Penna de Siqueira: But it is important to really explain why, because in Q1, this number may get not as precise as expected. Well, we had a quarter not with great revenue, but our crushing levels at very good numbers. In Goiás, we did not have to stop any of the production because of rainfall. Santa Vitória in June experienced one rainfall not expected for the period, and we had to skip some production days. Apart from that, everything is running as expected to close the season in November. Even in Santa Vitória, we do not expect to have any excessive sugarcane in the fields. Harvest will be completed. Now let us go into the Q&A session. Henrique is here with us, and he can answer any commercial questions you might have. Let us start our Q&A session now.

Speaker #1: Well we had a quarter not with great revenue but our crushing levels at very good numbers in Goiás we didn't have to stop any of the production because of rainfall.

[Company Representative] (Jalles Machado): Então, é um trimestre que se a comercialização não anda conforme andou o ano passado, acaba ficando um ajuste que dá uma distorção. Por isso que a gente gosta também de sempre trazer o custo de produção, tanto em milhões como em tonelada de ATR, para ver a real diferença daquilo que está se produzindo esse ano. Então, nós tivemos um custo de 0.4% menor, em reais de tonelada por ATR, de 5.1% menor está o nosso custo do que nós estamos produzindo esse ano. A visão caixa vai ficar mais coerente à medida que tem mais trimestres. Quando ela fica justa mesmo, é quando termina o ano. Mas como é uma prática de mercado, a gente acaba divulgando, mas tem que fazer sempre essa ressalva, que no primeiro trimestre esse número pode distorcer bastante. Bom, é isso, gente.

Speaker #1: Santa Victoria in June experienced one rainfall not expected for the period and we had to skip some production days but apart from that everything is running as expected to close the season in November.

Speaker #1: Even in Santa Victoria we don't expect to have any excessive sugarcane in the fields. Harvest will be completed. Now let's go into the Q&A session.

Speaker #1: Enrique is here with us and he can answer any commercial questions you might have. Let's start our Q&A session now to ask a question.

Rodrigo Penna de Siqueira: To ask a question, please use the Q&A button on the lower portion of the Zoom. If you want to ask a question, please write down that you would like to ask a question through the microphone, and then your mic will be unmuted. The question can be submitted in writing using the Q&A icon. If you are connected over the phone, you can also ask a question. In this case, type star nine through your phone. Once your name is called, you are going to hear a command to type star six, and by doing that, you can open your microphone. Just do it once, please. The first question comes by Victor Modoni with UBS. Hello. Good afternoon. Thank you for taking my question. First, I would like to have an update on your strategy of sales of ethanol and also your mix.

Operator: To ask a question, please use the Q&A button on the lower portion of the Zoom. If you want to ask a question, please write down that you would like to ask a question through the microphone, and then your mic will be unmuted. The question can be submitted in writing using the Q&A icon. If you are connected over the phone, you can also ask a question. In this case, type star nine through your phone. Once your name is called, you are going to hear a command to type star six, and by doing that, you can open your microphone. Just do it once, please. The first question comes by Victor Modoni with UBS.

Speaker #1: Please use the Q&A button on the lower portion of the Zoom if you want to ask a question. Please write down that you'd like to ask a question through the microphone and then your mic will be unmuted.

[Company Representative] (Jalles Machado): A gente teve um trimestre com pouco faturamento, mas a moagem está num ritmo muito bom na empresa esse ano. A gente não teve, nas unidades de Goiás, paradas por dias de chuva, aqui não está correndo muito bem. Santa Vitória, em junho, teve uma chuva fora do comum para a época, e a gente perdeu alguns dias de produção, mas está tudo justo para terminar a safra em novembro, mesmo lá em Santa Vitória, que teve esse problema de chuva, não temos problema de sobrar cana no campo, de bizar cana. Bom, vamos passar agora para o Q&A, lembrando que Henrique Penna está aqui conosco e vai poder também esclarecer mais dúvidas na parte comercial.

Speaker #1: The question can be submitted in writing using the Q&A icon. If you were connected over the phone you can ask also ask a question in this case.

Speaker #1: Type star nine through your phone once your name is called you are going to hear a comment to type star six and by doing that you can open your microphone just do it once please.

Speaker #1: The first question comes by Victor Modane. With UBS. Hello. Good afternoon. Thank you for taking my question. First I would like to have an update on your strategy of sales of ethanol and also your mix considering the current prices of both commodities we can see a sugar oriented mix going up in some regions so that's my question.

Victor Modanese: Hello. Good afternoon. Thank you for taking my question. First, I would like to have an update on your strategy of sales of ethanol and also your mix. Considering the current prices of both commodities, we can see a sugar-oriented mix going up in some regions. So that is my question. In your case specifically, considering the tax benefit, your location, your distance from the port, have you thought about going into more sugar-oriented mix? As Henrique is here, with improvement of ethanol price in last week, as you mentioned yourself, is it worth thinking about selling more from now on because you have prepared good inventory levels?

[Company Representative] (Jalles Machado): Vamos então dar início à sessão de perguntas e respostas. Para fazer uma pergunta, utilize o botão do Q&A na parte de baixo do aplicativo, clicando nesse ícone. Caso queira participar por áudio, apenas escreva nesse campo do Q&A que gostaria de fazer uma pergunta, o seu microfone será aberto posteriormente quando seu nome for anunciado. A pergunta pode também ser enviada ali, por escrito, usando esse mesmo campo de Q&A do aplicativo. Caso esteja conectado por telefone, também é possível fazer perguntas. Nesse caso, digite *9 no seu telefone. Após ter seu nome anunciado, você vai ouvir um comando para digitar *6, que permitirá abrir o seu microfone. Esse comando deverá ser feito apenas uma vez. Vamos ter nossa primeira pergunta, por voz, de Vitor Modanesi, do UBS.

Victor Modoni: Considering the current prices of both commodities, we can see a sugar-oriented mix going up in some regions. So that is my question. In your case specifically, considering the tax benefit, your location, your distance from the port, have you thought about going into more sugar-oriented mix? As Henrique is here, with improvement of ethanol price in last week, as you mentioned yourself, is it worth thinking about selling more from now on because you have prepared good inventory levels? My second question is an update about organic sugar. Have you been talking to your potential clients? I know sales are more concentrated on the H2 of the year. But I would like to know what you have been talking with your potential partners about the purchase of organic sugar. You have talked about a 5% possible drop in price of organic sugar in your last call.

Speaker #1: In your case specifically considering the tax benefit your location your distance from the port have you thought about going into more sugar oriented mix and as Enrique is here with improvement of ethanol price in last week as you mentioned yourself is it worth thinking about selling more from now on because you've prepared good inventory levels.

Speaker #1: My second question is an update about organic sugar have you been talking to your potential clients I know concentrations are sales are not concentrated on the second half of the year but I would like to know what you've been talking with your potential partners about the purchase of organic sugar.

Victor Modanese: My second question is an update about organic sugar. Have you been talking to your potential clients? I know sales are more concentrated on the H2 of the year. But I would like to know what you have been talking with your potential partners about the purchase of organic sugar. You have talked about a 5% possible drop in price of organic sugar in your last call. But now knowing about the prices in Brazil and also regional competitors that work and also have organic sugar production, are you expected to maintain the same levels? Thank you.

Speaker #1: You've talked about a 5% possible drop in price of organic sugar in your last call but now knowing about the prices in Brazil and also regional competitors that work and also have organic sugar production production are you expected to maintain the same levels.

Vitor Modanesi: Oi, bom dia. Obrigado pelo espaço para fazer as perguntas. Primeiro, eu gostaria de pegar uma atualização sobre a estratégia de venda de etanol e também sobre mix. Dado o patamar de preços atuais nas duas commodities, a gente já está vendo o mix de açúcar aumentar em algumas regiões. Então, minha pergunta aqui é no sentido de entender se no caso de vocês, em específico, dados os benefícios fiscais e a localização de vocês, a distância do porto, se já faz sentido virar o mix para o açúcar. Além disso, aproveitando a presença do Henrique no call, se com a melhora do preço de etanol visto ao longo da última semana, como foi comentado durante o call, já dá para pensar em uma aceleração de vendas, dado o estoque que foi montado ao longo do trimestre.

Henrique Penna de Siqueira: But now knowing about the prices in Brazil and also regional competitors that work and also have organic sugar production, are you expected to maintain the same levels? Thank you. Good afternoon. Great to be here with you. Now and then, I show up to talk a little bit with you. Thank you, Victor, for the question. I am trying to address all the issues, and please let me know if I forgot anything. About inventory policies. This was the idea, as Rodrigo said. We saw the prices of ethanol. The prices went down compared to previous year. In May, the price was really low, and from then on, we thought that we could really use our storage position in Otávio Lage, Jalles Machado, and Santa Vitória. So we started building up our inventory, selling lower volumes than last year having that in mind.

Speaker #1: Thank you. Good afternoon. Great to be here with you. Now and then I show up to talk a little bit with you. Thank you Victor for the question.

Henrique Penna de Siqueira: Good afternoon. Great to be here with you. Now and then, I show up to talk a little bit with you. Thank you, Victor, for the question. I am trying to address all the issues, and please let me know if I forgot anything. About inventory policies. This was the idea, as Rodrigo said. We saw the prices of ethanol. The prices went down compared to previous year. In May, the price was really low, and from then on, we thought that we could really use our storage position in Otávio Lage, Jalles Machado, and Santa Vitória. So we started building up our inventory, selling lower volumes than last year having that in mind.

Speaker #1: I'm trying to address all the issues and please let me know if I forgot anything. About inventory policies. This was the idea as Rodrigo said we saw the prices of ethanol the prices went down compared to previous year in May the price was really low and from then on we thought that we could really use our storage position in Otavio Lajes, Jalles Machado and Santa Victoria so we started building up our inventory selling lower volumes than last year having that in mind.

Vitor Modanesi: Essa é minha primeira, e a segunda é uma atualização sobre o açúcar orgânico. Queria entender como que estão as conversas iniciais com os compradores dos produtos de vocês, e aqui eu entendo que as negociações são mais concentradas no segundo semestre do ano, mas é mais pegar uma percepção inicial das primeiras interações com seus parceiros comerciais de orgânico. No último call, teve até um comentário de uma possível queda esperada para o ano, em torno de 5%, se eu não me engano, no preço do orgânico. Então, à luz das novas informações que a gente tem, sabendo a tarifa do Brasil, mas também dos concorrentes regionais na produção de açúcar orgânico, se essa expectativa de preço para a safra se mantém. São essas. Obrigado.

Speaker #1: Of course we monitored it closely but we believed that there was a high potential to increase prices. Now thanks to price increases we are thinking about future opportunities.

Rodrigo Penna de Siqueira: Of course, we monitored it closely, but we believed that there was a high potential to increase prices. Now, thanks to price increases, we are thinking about future opportunities. We can still carry on our inventory without selling it immediately. We will hold it for a while to sell it at the best time where we can see good carryover for the period that we have off-season, but always monitoring ethanol prices, because if it reacts strongly in upcoming days, we can also calculate what we expect. We consider carryover. Normally, there is 14% interest rate. If prices go up to BRL 2.80, BRL 2.85, maybe it makes sense to sell a part of our inventory. But so far, we expect to wait until off-season to sell the volume of ethanol we have in our inventories. You have also asked about mix. In the beginning of the month, we had made a change.

Henrique Penna de Siqueira: Of course, we monitored it closely, but we believed that there was a high potential to increase prices. Now, thanks to price increases, we are thinking about future opportunities. We can still carry on our inventory without selling it immediately. We will hold it for a while to sell it at the best time where we can see good carryover for the period that we have off-season, but always monitoring ethanol prices, because if it reacts strongly in upcoming days, we can also calculate what we expect. We consider carryover. Normally, there is 14% interest rate. If prices go up to BRL 2.80, BRL 2.85, maybe it makes sense to sell a part of our inventory. But so far, we expect to wait until off-season to sell the volume of ethanol we have in our inventories. You have also asked about mix. In the beginning of the month, we had made a change.

uh,

Henrique Penna: Boa tarde a todos. Prazer estar com vocês aqui. De vez em quando aparecemos para conversar um pouco. Obrigado, Vitor, pela questão. Eu vou tentar atacar todos os pontos aqui, qualquer coisa você fala, se ficar alguma coisa para trás. Primeiro sobre a política de estoque e vendas. Essa foi a ideia, como Odil comentou, a gente enxergou, o preço do etanol caiu muito rápido esse ano, diferente de anos anteriores. Em maio, a gente já estava com preços muito baixos e dali para frente, a gente começou a aproveitar a nossa capacidade de tankagem, que é muito positiva. Tanto na Unidade Otávio Lage, quanto na Jalles, quanto na Unidade Santa Vitória, e já começamos a construir um estoque vendendo um volume bem inferior ao ano passado.

Speaker #1: We can still carry on our inventory without selling it immediately we'll hold it for a while to sell it at the best time where we can see good carry over for the period that we have off season but always monitoring ethanol prices because if it reacts strongly in upcoming days we can also calculate what we expect we consider carry over normally there is 40 14% interest rate if prices go up to 2.80 2.85 maybe it makes sense to sell a part of our inventory but so far we expect to wait until lost season to sell the volume of ethanol we have in our inventories.

For.

Speaker #1: You've also asked about mix. In the beginning of the month we had made a change. As you know our unit Santa Victoria is in Minas Gerais very close to export points and the units in Goiás.

Henrique Penna: Lógico que tinha um pouco de cuidado em relação a essa tração da venda, mas a gente acreditava que o potencial de subida e o carrego era muito grande. Então nós fizemos, e agora, com essa subida de preço, a gente está olhando muito para a curva futura, Vitor. Então, nós temos condição ainda de carregar estoque sem vender imediatamente. Então nós vamos estar segurando ainda um pouco para vender nos melhores momentos, que a gente enxerga um carrego interessante para o período de entressafra, mas, lógico, sempre de olho no preço do etanol, porque se o preço do etanol reagir muito nos próximos dias, de repente, a gente sempre faz a conta do que espera lá na frente e joga o carrego.

Rodrigo Penna de Siqueira: As you know, our unit, Santa Vitória, is in Minas Gerais, very close to export points and the units in Goiás. In Goiás, we have maintained the same focus because the price is highly competitive with the subsidies for hydrous and anhydrous ethanol prices. But in Santa Vitória, now it makes more sense to sell sugar and to produce more sugar there. We have switched our production to sugar-oriented mix in the unit Santa Vitória. It is so great that we had a large volume of sugarcane available. That is going to be quite good production at good price ranges, and part of the volume has already been hedged. Now talking about organic sugar, our position is quite robust. We have already traded nearly 90% of the volume of organic sugar. We are contracted in most of this volume. There was an impact in price.

Henrique Penna de Siqueira: As you know, our unit, Santa Vitória, is in Minas Gerais, very close to export points and the units in Goiás. In Goiás, we have maintained the same focus because the price is highly competitive with the subsidies for hydrous and anhydrous ethanol prices. But in Santa Vitória, now it makes more sense to sell sugar and to produce more sugar there. We have switched our production to sugar-oriented mix in the unit Santa Vitória. It is so great that we had a large volume of sugarcane available. That is going to be quite good production at good price ranges, and part of the volume has already been hedged. Now talking about organic sugar, our position is quite robust. We have already traded nearly 90% of the volume of organic sugar. We are contracted in most of this volume. There was an impact in price.

Speaker #1: In Goiás we have maintained the same focus because the price is highly competitive with the subsidies for hydro then and hydro ethanol prices but in Santa Victoria now it makes more sense to sell sugar and to produce more sugar there.

Speaker #1: So we've switch it our production to sugar oriented mix in the unit Santa Victoria it's so great that we had a large volume of sugar cane available so that's going to be quite good production with at good price ranges and part of the volume has already been hedged.

Guys.

Henrique Penna: Então você tem aí mais ou menos 14 centavos ao ano de Selic, traz para o mês a mês, se o preço der uma corrida grande, por exemplo, para 2,80, 2,85, de repente, já faz sentido vender alguma coisa, mas a visão de hoje é de esperar até a entressafra para vender o volume de etanol que a gente fez. Um outro ponto que você perguntou é sobre mix. Aqui nós tivemos uma mudança nesse início de mês agora. Nós temos, como vocês sabem, a Unidade Santa Vitória, que fica em Minas, mais próxima do porto, e aqui em Goiás. Aqui em Goiás, nós permanecemos da Falcon e Tvinha, porque ainda o preço é bem competitivo aqui com os incentivos para o etanol hidratado e o anidro. Mas em Unidade Santa Vitória, com essa puxada que deu no açúcar, já passou a fazer mais sentido vender açúcar lá e produzir mais açúcar.

Speaker #1: Now talking about organic sugar our position is quite robust. We have already traded nearly 90% of the volume of organic sugar we are contracted in most of this volume there was an impact in price as we thought that the US could maintain the high tariffs our customers in the US they started asking for discount in part of the volume there was a decrease in price of about 8% over last year but in terms of volume there are two points to be made.

For.

Rodrigo Penna de Siqueira: As we thought that the US could maintain the high tariffs, our customers in the US, they started asking for discount in part of the volume. There was a decrease in price of about 8% over last year. But in terms of volume, there are two points to be made. First of all, there was a minor decrease, including the volumes for the US. However, it is related with the break bulk movement that we had in Q1 last year. Break bulk was a ship of bagged sugar in the lower portions of the ship. It was a one-off episode, and it was in April, May last year. This year, we have not had any of this break bulk initiative. So the total organic sugar sold up to March next year will be at about 65,000 to 70,000 tons. Have I covered all your questions? Yeah, absolutely. Thank you.

Henrique Penna de Siqueira: As we thought that the US could maintain the high tariffs, our customers in the US, they started asking for discount in part of the volume. There was a decrease in price of about 8% over last year. But in terms of volume, there are two points to be made. First of all, there was a minor decrease, including the volumes for the US. However, it is related with the break bulk movement that we had in Q1 last year. Break bulk was a ship of bagged sugar in the lower portions of the ship. It was a one-off episode, and it was in April, May last year. This year, we have not had any of this break bulk initiative. So the total organic sugar sold up to March next year will be at about 65,000 to 70,000 tons. Have I covered all your questions?

Henrique Penna: Então nós viramos essa produção, o mix, para açúcar na Unidade Santa Vitória. E ainda bem que nós ainda tínhamos um volume grande de cana, então estamos tirando uma produção interessante com essa puxada de preço e até já fizemos a fixação lá, boa parte desse volume. Comentando sobre açúcar orgânico, hoje nós temos uma posição muito mais sólida de falar, porque nós já comercializamos praticamente 90% do volume de orgânico. Nós estamos com contratados, na maior parte desse volume. Tivemos um impacto no preço, principalmente, porque como nós tínhamos uma visão de que os Estados Unidos podia manter o tarifaço, o nosso cliente nos Estados Unidos, principalmente, já começaram a jogar um desconto numa parte do volume. Então nós tivemos uma queda no preço, que deve cair na casa dos 8% em relação ao ano passado, mas em termos de volume, tem duas coisas que eu tenho que falar.

Speaker #1: First of all there was a minor decrease including including the volumes for the US however it is related with the break bulk movement that we had in the first quarter last year break bulk was a ship of bag sugar in the lower portions of the ship it was a one off episode and it was in April May last year.

Motor.

Speaker #1: This year we haven't had that. Any of this break bulk initiative. So the total organic sugar sold up to March next year will be at about 60 65 to 70,000 tons.

Impact.

Speaker #1: Have I covered all your questions? Yeah absolutely. Thank you. Let's move on to the next question. Guilherme Butila with BTG.

Victor Modanese: Yeah, absolutely. Thank you.

Rodrigo Penna de Siqueira: Let us move on to the next question. Guilherme Buzella with BTG. Hello, Rodrigo, Henrique. Good afternoon. I have two questions. First, concerning the unit cost. I think during your presentation, you show the difference of unit cost of TRS that you produce and that you sell, and why there might be distortions during the quarter. But thinking about the crop year as a whole, based on what you have seen so far and what you anticipate, what do you think it is possible to consider in terms of dilution of unit cost for this crop year? My second question concerning productivity, but now focusing on Santa Vitória. There has been a decrease on the average age of your sugarcane fields in Santa Vitória, meaning that you have been really renovating it. How much is still left to get to the ideal, so to call, sugarcane field for this unit?

Operator: Let us move on to the next question. Guilherme Buzella with BTG.

Speaker #2: Good evening.

Guilherme Guttilla: Hello, Rodrigo, Henrique. Good afternoon. I have two questions. First, concerning the unit cost. I think during your presentation, you show the difference of unit cost of TRS that you produce and that you sell, and why there might be distortions during the quarter. But thinking about the crop year as a whole, based on what you have seen so far and what you anticipate, what do you think it is possible to consider in terms of dilution of unit cost for this crop year?

Speaker #1: Hello. Rodrigo and Hickey good afternoon. I have two questions. First concerning the unit cost. I think during your presentation you show the difference of unit cost of TRS that you produce and that you sell and why there might be distortions during the quarter.

Henrique Penna: Primeiro, a gente teve uma queda pequena no volume, inclusive para os Estados Unidos, porém, ele está bem relacionado a um volume de break bulk que nós fizemos no Q1 do ano passado. O break bulk, a gente fez um navio de açúcar em bag, que a gente coloca no porão do navio, e foi uma demanda pontual que aconteceu abril e maio do ano passado. Isso nós não tivemos esse ano.

For.

Speaker #1: But thinking about the crop year as a whole based on what you've seen so far and what you anticipate what do you think it's possible to consider in terms of dilution of unit cost for this crop year.

[Company Representative] (Jalles Machado): A gente está esperando que, para este ano, o total de açúcar orgânico faturado até março do ano que vem, deve estar na casa de 65 a 70 mil toneladas. Não sei se consegui cobrir todas as perguntas, Vitor.

Speaker #1: My second question concerning productivity but now focusing on Santa Victoria. There has been a decrease on the average age of your sugar cane fields in Santa Victoria meaning that you've been really renovating it.

Guilherme Guttilla: My second question concerning productivity, but now focusing on Santa Vitória. There has been a decrease on the average age of your sugarcane fields in Santa Vitória, meaning that you have been really renovating it. How much is still left to get to the ideal, so to call, sugarcane field for this unit? And when you get to that level, what would be the amount of sugarcane per hectare that you expect this unit to be able to yield? Thank you.

Breaking.

Vitor Modanesi: Sim, perfeito, está bem claro. Obrigado.

Speaker #1: How much is still left to get to the ideal so to call sugar cane field for this unit and when you get to that level what would be the amount of sugar cane per hectare that you expect this unit to be able to yield.

[Company Representative] (Jalles Machado): Vamos então seguir para a pergunta de Guilherme Guttilla, do BTG, que também será feita por voz.

Rodrigo Penna de Siqueira: And when you get to that level, what would be the amount of sugarcane per hectare that you expect this unit to be able to yield? Thank you. Good afternoon, Guilherme. Thank you for being here with us and for your participation. It is a good question, and I will just piggyback on your question to share with you some interesting data concerning Santa Vitória and the yield of irrigated crops. But first talking about cost. In the last call, I told you that we were expecting a recovery of productivity, and if we combined it with what is going to be spent, we expect 5% cost reduction, which is what we showed in Q1. What we are producing already has shown 5.1% cost reduction per TRS ton.

Guilherme Guttilla: Rodrigo Henrique, tudo bem? Boa tarde. São duas perguntas do nosso lado também. A primeira é em relação ao custo unitário. Vocês explicaram bem, durante a apresentação, essa diferença entre o custo unitário do ATR que vocês produzem e que vocês vendem ao longo da safra, e porque isso pode gerar algumas distorções no trimestre. Pensando agora no ano safra como um todo, pelo que vocês já viram, o que vocês estão esperando, quanto que vocês acham que é possível a gente imaginar de diluição desse custo unitário para essa safra? A segunda pergunta também relacionada à produtividade, mas agora focando em Unidade Santa Vitória. Uma coisa que tem chamado a atenção é essa diminuição da idade média do canavial da Unidade Santa Vitória. Isso dá para imaginar que ao longo dos últimos anos, vocês fizeram um grande processo de renovação de canavial na unidade.

Speaker #1: Thank you. Good afternoon Guilherme. Thank you. For being here with us and for your participation. It's a good question. And I'll just pick back on your question to share with you some interesting data concerning Santa Victoria and the yield of irrigated crops.

Henrique Penna de Siqueira: Good afternoon, Guilherme. Thank you for being here with us and for your participation. It is a good question, and I will just piggyback on your question to share with you some interesting data concerning Santa Vitória and the yield of irrigated crops. But first talking about cost. In the last call, I told you that we were expecting a recovery of productivity, and if we combined it with what is going to be spent, we expect 5% cost reduction, which is what we showed in Q1. What we are producing already has shown 5.1% cost reduction per TRS ton.

My.

Speaker #1: But first talking about cost the last call I told you that we were expecting a recovery of productivity and if we combined it with what's going to be spent we expect 5% cost reduction which is what we showed in the first quarter.

That.

Guilherme Guttilla: O ponto aqui é: quanto que vocês acham que ainda falta para vocês chegarem em um canavial que vocês considerariam um canavial ideal para essa unidade e, no momento que vocês chegarem, qual seria um nível de tonelada de cana por hectare que a gente poderia imaginar que essa unidade conseguisse dar de forma mais estrutural? Por favor.

Speaker #1: What we are producing already has shown 5.1% cost reduction per TRS ton. The average age of our sugar cane field in Santa Victoria in the quarter it was low because we had the first sugar cane planted last year was not the best.

Rodrigo Penna de Siqueira: The average age of our sugarcane field in Santa Vitória in the quarter, it was low because we had the first sugarcane planted last year, was not the best, what was harvested this quarter. But it has low average age because we are renewing the sugarcane fields and expanding them. The one we have in Santa Vitória, what we estimate is to bring productivity to 80 tons per hectare, which is our goal. We were expected to do it this year. We told you, we gave you a guidance in a Jalles Day 3 years saying that this year we wanted to reach 79 tons per hectare of yield. We did not get that much because of the drought last year, and also because of management adjustments, which were somewhat slower than expected. I think Joel talked about that in our last call.

Henrique Penna de Siqueira: The average age of our sugarcane field in Santa Vitória in the quarter, it was low because we had the first sugarcane planted last year, was not the best, what was harvested this quarter. But it has low average age because we are renewing the sugarcane fields and expanding them. The one we have in Santa Vitória, what we estimate is to bring productivity to 80 tons per hectare, which is our goal. We were expected to do it this year. We told you, we gave you a guidance in a Jalles Day 3 years saying that this year we wanted to reach 79 tons per hectare of yield. We did not get that much because of the drought last year, and also because of management adjustments, which were somewhat slower than expected. I think Joel talked about that in our last call.

Out.

[Company Representative] (Jalles Machado): Boa tarde, Guilherme, tudo bem? Obrigado pela presença, pela participação e pela pergunta. Uma boa pergunta, eu vou até aproveitar a sua pergunta para trazer um dado interessante que nós estamos tendo lá em Unidade Santa Vitória em relação à produtividade de cana irrigada. Mas indo para a primeira questão, que é sobre o custo, no último call a gente tinha comentado que a gente estava esperando uma recuperação de produtividade e que somando essa recuperação de produtividade com o que a gente vai gastar de custo, nós estamos esperando por volta de 5% de redução de custo, que é o que já mostrou no primeiro tri, que daquilo que a gente está produzindo, a gente já veio com esses 5.1% de redução de custo por tonelada de ATR. A idade média do canavial de Unidade Santa Vitória, Gutila, é uma idade média que no trimestre foi baixa, por quê?

Speaker #1: What was harvest this quarter but it has low average age because we are renewing the sugar cane fields and expanding them. The one we have in Santa Victoria what we estimate is to bring productivity to 80 ton per hectare which is our goal.

Speaker #1: We were expected to do it this year. And we told you we gave you a guidance in a Jalles day three years saying that this year we wanted to reach 79 tons per hectare.

Thank you so much.

Speaker #1: Of yield. We didn't get that much because of the drought last year and also because of management adjustments which were somewhat slower than expected I think Joel talked about that in our last call.

Speaker #1: Joel our VP of operations was asked to give you some more information about that. Even those who were with us in Santa Victoria last year out in the field we showed you where we had implementation of central pivot for irrigation.

Rodrigo Penna de Siqueira: Joel, our VP of operations, was asked to give you some more information about that. Even those who were with us in Santa Vitória last year, out in the field, we showed you where we had the implementation of 3 center-pivot for irrigation. We already have 60% of these areas of pivot irrigation. Next quarter, I am going to show you what the 100% looked like. But the productivity that had been estimated at 150 tons per hectare went up to 170. In terms of viability to have this irrigation project, we considered 130 for the feasibility study. The company estimated 150 for this year, seeing that the sugarcane was great.

Henrique Penna de Siqueira: Joel, our VP of operations, was asked to give you some more information about that. Even those who were with us in Santa Vitória last year, out in the field, we showed you where we had the implementation of 3 center-pivot for irrigation. We already have 60% of these areas of pivot irrigation. Next quarter, I am going to show you what the 100% looked like. But the productivity that had been estimated at 150 tons per hectare went up to 170. In terms of viability to have this irrigation project, we considered 130 for the feasibility study. The company estimated 150 for this year, seeing that the sugarcane was great.

[Company Representative] (Jalles Machado): Porque a gente teve muita cana planta. As primeiras canas que plantaram no ano passado não são as melhores, o que a gente colhe nesse trimestre, mas ela abaixa a idade média, porque a gente está tanto renovando o canavial, como expandindo o canavial. Esse canavial de Unidade Santa Vitória, hoje, o que a gente está estimando é trazer essa produtividade para 80 toneladas por hectare, que é a nossa meta. Era para ser esse ano, que a gente comentou isso, a gente soltou um guidance no Jalles Day uns 3 anos atrás, falando que esse ano a gente queria chegar a 79 toneladas por hectare. Nós não chegamos, porque teve a seca muito grande ano passado e também os ajustes no manejo foram um pouco mais lentos que a gente gostaria. Acho que o Joel até explicou bastante esse assunto no último call.

For.

Speaker #1: We've already have a 60% of these areas of private pivot irrigation and next quarter I'm going to show you what the 100% looked like but the productivity that had been estimated at 150 hectares ton per hectares went up to 170.

Speaker #1: And in terms of viability to have this irrigation project we considered 130. For the feasibility study the company estimated 150 for this year seeing that the sugar cane is was great but we are getting even more surprised because the same area when we used to have unirrigated sugar cane of course where the previous owners of the unit Santa Victoria used to operate under their management but it reached 85 80 or 85 tons of can per hectare the same sugar cane in the same area in the previous cycle.

For.

Rodrigo Penna de Siqueira: But we are getting even more surprised because the same area, when we used to have unirrigated sugarcane, of course, where the previous owners of the unit, Santa Vitória, used to operate under their management, but it reached 80 or 85 tons of cane per hectare. The same sugarcane in the same area in the previous cycle. Can you see the variation? It went from 80, 85 up to over 170. The question that we had, whether full irrigation would have an impact in unit Santa Vitória, as it has here in Goiás. It is being much better even than we thought. Something good. Because we have water abundance, and this is going to help us increase yields. But there are a number of other things that we have been doing in terms of management, salvage irrigation, organic fertilizers, and also replacement of areas, right?

Henrique Penna de Siqueira: But we are getting even more surprised because the same area, when we used to have unirrigated sugarcane, of course, where the previous owners of the unit, Santa Vitória, used to operate under their management, but it reached 80 or 85 tons of cane per hectare. The same sugarcane in the same area in the previous cycle. Can you see the variation? It went from 80, 85 up to over 170. The question that we had, whether full irrigation would have an impact in unit Santa Vitória, as it has here in Goiás. It is being much better even than we thought. Something good.

[Company Representative] (Jalles Machado): Nós trouxemos o Joel, que é o Diretor de Operações, exatamente para dar uma cor nisso. O que a gente fez? Até quem esteve no Jalles Day conosco em Santa Vitória no ano passado, a gente fez no campo, em uma região que a gente implantou três pivôs, com total de 700 hectares. A gente já colheu praticamente 60% dessas áreas de pivô. No próximo tri, eu quero trazer aqui o resumo do que foi os 100%, mas a produtividade que a gente tinha estimado na casa de 150 toneladas por hectare, ultrapassou 170 até agora. Foi acima de 170. O que está acontecendo? Na viabilidade que a gente fez para instalar esse projeto de irrigação naquele local, a gente considerou 130. 130 para fazer a viabilidade.

Face attack.

Speaker #1: Can you see the variation it went from 80 85 up to over 170. The question that we had whether full irrigation would have an impact in unit Santa Victoria as it has here in Guyana it is being much better even than we thought.

Speaker #1: Something good. Because we have water abundance and this is going to help us increase yields but there are a number of other things that we've been doing in terms of management salvage irrigation organic fertilizers and also replacement of areas right.

Henrique Penna de Siqueira: Because we have water abundance, and this is going to help us increase yields. But there are a number of other things that we have been doing in terms of management, salvage irrigation, organic fertilizers, and also replacement of areas, right? Exchanging areas that had lower clay content. We are returning some areas, getting others. All of that has been done by the company to adjust that because there is a full supply of areas in the region to be explored, right? So center-pivot irrigation has proved to be essential.

[Company Representative] (Jalles Machado): A empresa estimou nesse canavial, para esse ano, 150, viu que a cana estava boa e está surpreendendo ainda mais. Por que eu estou falando isso? Porque essa mesma área, Gutila, quando era cana não irrigada, claro que foi no manejo dos antigos donos lá da Unidade Santa Vitória, mas ele deu 80, 85 toneladas de cana por hectare, essa mesma cana de primeiro corte nessa área no ciclo anterior. Então olha o delta. O negócio pulou de 80, 85 para mais de 170. Aquela dúvida que nós tínhamos, se a irrigação plena ia ter impacto na Unidade Santa Vitória, como tem aqui em Goiás, irrigação com pivô, e está sendo muito melhor que a gente esperava.

Speaker #1: Exchanging areas that had lower clay content we are returning some areas getting others all of that has been done by the company to adjust that because we there is full supply of areas in the region to be explored right.

Rodrigo Penna de Siqueira: Exchanging areas that had lower clay content. We are returning some areas, getting others. All of that has been done by the company to adjust that because there is a full supply of areas in the region to be explored, right? So center-pivot irrigation has proved to be essential. That is great. Very clear. Thank you very much. Now a question from Gabriel Barra with Citi. Gabriel, please unmute your mic. Gabriel, I am sorry, cannot hear you. Well, I will give you the question later, Gabriel. Let me now invite Bruno Tomaz with Itaú BBA. Hello, good afternoon. Thank you for taking my question. Rodrigo, when we look at the crushing in the quarter, we have a 10% acceleration, very much aligned with the guidance you have provided. For the 10% you added in the explanatory note, I did not think that would be 10% for the quarter.

no, he got the

Speaker #1: So center pivot irrigation has proved to be essential. That's great. Very clear. Thank you very much. Now my question from Gabriel Barra with City.

Guilherme Guttilla: That is great. Very clear. Thank you very much.

Victoria.

Operator: Now a question from Gabriel Barra with Citi. Gabriel, please unmute your mic. Gabriel, I am sorry, cannot hear you. Well, I will give you the question later, Gabriel. Let me now invite Bruno Tomaz with Itaú BBA.

Speaker #1: Gabriel please unmute your mic. Gabriel I'm sorry cannot hear you. Well I'll give you the question later Gabriel. Let me now invite Bruno Tomazetto with Itaú BBA.

[Company Representative] (Jalles Machado): Então é uma coisa boa, porque nós temos uma abundância de água lá e também vai ajudar a puxar essa produtividade para cima, mas tem várias outras coisas que estão sendo feitas em questão de manejo, a irrigação de salvamento, variedade, como a gente falou, e uso de composto orgânico, como nós falamos em calls anteriores, e até troca de áreas, vencendo contrato de áreas com menor teor de argila, a gente devolvendo algumas áreas. Então tudo isso a empresa tem feito para ajustar, porque tem uma abundância de áreas muito grande lá na região. Não sei se respondi todas as perguntas, Guilherme. Fica à vontade aí se tiver mais algum ponto.

He got some people.

For.

Speaker #1: Hello good afternoon. Thank you for taking my question. Rodrigo when we looked crushing in the quarter we have a 10% acceleration very much aligned with the guidance you've provided but the 10% you added in the explanatory note I didn't think that would be 10% for the quarter.

Bruno Tomazetto: Hello, good afternoon. Thank you for taking my question. Rodrigo, when we look at the crushing in the quarter, we have a 10% acceleration, very much aligned with the guidance you have provided. For the 10% you added in the explanatory note, I did not think that would be 10% for the quarter.

Speaker #1: So please help me understand how good that 10% can actually be would there be any comparing really the beginning of the year and the expectations that you have to the year end.

Bruno Tomaz: Please help me understand how good that 10% can actually be. Would there be any upside in that specific guidance, just comparing the beginning of the year and the expectations that you have to the year-end? As to the settlement of hedge in the quarter, it seems that there was some mismatch between the hedge you had in the past as opposed to the production index that was more ethanol-oriented. Now you are back in 100% of hedge of the available volume. Tell us more about the timing and how you undo operations. Maybe it could have been done more by the end of the year if the market just became more sugar-oriented. For example, we just heard about that adjustment in Santa Vitória, just understanding volumes and timing.

Bruno Tomazetto: Please help me understand how good that 10% can actually be. Would there be any upside in that specific guidance, just comparing the beginning of the year and the expectations that you have to the year-end? As to the settlement of hedge in the quarter, it seems that there was some mismatch between the hedge you had in the past as opposed to the production index that was more ethanol-oriented.

Guilherme Guttilla: Respondeu sim, Rodrigo. Obrigado, está bem claro.

This.

[Company Representative] (Jalles Machado): A pergunta agora é de Gabriel Barra, do Citi, também será feita por voz. Gabriel, pode seguir. Gabriel, está na linha? Gabriel Barra? Voltamos ao Gabriel, então depois, e vou seguir agora para Bruno Tomazato, do Itaú BBA.

Speaker #1: As to the settlement of hedges in the quarter it seemed that there was some mismatch between the hedge you had in the past as opposed to the production index that was more ethan oriented now we are going you're back in 100% of hedge of the available volume.

Bruno Tomazetto: Now you are back in 100% of hedge of the available volume. Tell us more about the timing and how you undo operations. Maybe it could have been done more by the end of the year if the market just became more sugar-oriented. For example, we just heard about that adjustment in Santa Vitória, just understanding volumes and timing. How do you manage that in terms of hedge and the operations that you had with your settled hedge?

Gabrielle.

The bah.

Speaker #1: Tell us more about the timing and how you undo operations and maybe it could have been done more by the end of the year if the market just became more sugar oriented for example we've just heard about that adjustment in Santa Victoria just understanding volumes and timing how How do you do you manage that in terms of hedge and the operations that you've had with your settled hedges Hi , Bruno .

Is 46.

Bruno Tomazato: Oi, pessoal, boa tarde. Obrigado por pegar as perguntas. Rodrigo, quando a gente olha a moagem no tri acelerando seus 10%, parece bastante alinhado com o guidance que vocês têm para o ano. Mas eu entendo que não necessariamente aquele 10% que vocês colocaram de expectativa, necessariamente implicasse 10% no tri aqui. Eu imagino que tenha uma curva que você estava pensando para o ano. Eu queria só sua ajuda para entender o quão melhor esses 10% aqui na largada poderiam ser melhor do que aquilo que vocês estavam colocando aqui para o começo do ano, a fim de eventualmente implicar algum upside naquele guidance que vocês tinham colocado. Então só comparar aqui como que foi esse início de largada do ano versus as expectativas que vocês tinham para o ano fechado.

Rodrigo Penna de Siqueira: How do you manage that in terms of hedge and the operations that you had with your settled hedge? Hi, Bruno Tomaz, can you hear me all right? Yes. Well, crushing in the first quarter, let me tell you how it was as opposed to our guidance. We have confirmed our guidance in the release, but it has a bias of an upward trend. The first quarter was surprisingly good, but we still have, of course, the continuation of the crop year. We have been monitoring it closely, and we might revisit if we are going to maintain the same levels of crushing or not. So far, I can tell you that the first quarter was somewhat better than we expected, not much, but any percentage in sugarcane volume impacts our cash, of course. Now, hedge settlement, very good question.

Rodrigo Penna de Siqueira: Hi, Bruno Tomaz, can you hear me all right?

Speaker #1: Can you hear me ? All right Yes Well , crushing in the first quarter Let me tell you how it was . As opposed to our guidance We have confirmed our guidance in the release .

Bruno Tomazetto: Yes.

Rodrigo Penna de Siqueira: Well, crushing in the Q1, let me tell you how it was as opposed to our guidance. We have confirmed our guidance in the release, but it has a bias of an upward trend. The Q1 was surprisingly good, but we still have, of course, the continuation of the crop year. We have been monitoring it closely, and we might revisit if we are going to maintain the same levels of crushing or not. So far, I can tell you that the Q1 was somewhat better than we expected, not much, but any percentage in sugarcane volume impacts our cash, of course. Now, hedge settlement, very good question.

Bruno Tomazato: E sobre a liquidação dos hedges no tri, eu entendi que isso daqui veio de uma demanda por algum descompasso que vocês tinham entre o ritmo de hedge que vocês tinham feito no passado versus o mix de produção, que era mais alcooleiro nesse ano. Então a companhia agora voltou para 100% de hedge no volume disponível. Eu queria só entender com vocês como funciona o timing para isso, para desfazer essas operações, agora já no começo do ano, ou até onde a companhia poderia ter pensado em, por exemplo, deixar isso daqui mais para o final do calendário ali, caso o mercado virasse para um mix mais açucareiro do mercado no meio do caminho.

Speaker #1: But it has a bias of and upward trend . The first quarter was surprisingly good , but we still have , of course , the continuation of the crop year .

Speaker #1: We've been monitoring it closely , and we might revisit if we are going to maintain the same levels of crushing or not . So far , I can tell you that the first quarter was somewhat better than we expected , but much .

Bruno Tomazato: Na Santa Vitória, o Henrique mesmo agora acabou de comentar sobre maximização de açúcar, então só queria entender como que esse volume adicional aqui de açúcar para o ano se conversa com o hedge e como que se conversa com a operação que você fez ali nos hedges liquidados. É isso, obrigado.

Speaker #1: But any percentage in sugar cane volume impacts our cash . Of course , now hedge settlement very good question We had an adjustment because we hadn't had a hedge for a landscape which was more sugar oriented than it was in May and June .

Liquid.

[Company Representative] (Jalles Machado): Bruno, está me ouvindo?

Rodrigo Penna de Siqueira: We had an adjustment because we had not had a hedge for a landscape which was more sugar-oriented than it was in May and June. Why did we decide to make an adjustment going into a more ethanol-oriented mix? Because the price was 1,600, 1,700 per ton. It was a good moment to have the adjustment. So we made the adjustment to the point that we realized it would go into ethanol-oriented mix, but not the end of the crop year, because we can produce sugar. We are not working or supporting our hedge for speculation, but rather for price protection. There is a logic policy to be followed. We adjusted between May and June, but without undoing anything to the end of the crop year, because of sugar-oriented mix. There was an 80%, and now it was 100%. It became 100% of available volume.

oh,

Bruno Tomazato: Estou ouvindo, estou ouvindo bem.

[Company Representative] (Jalles Machado): Então, Bruno, sobre a moagem no primeiro tri. Como que foi ela em relação ao nosso guidance. A gente reafirmou o guidance no release, mas ele está com viés de alta. Vamos falar assim, esse primeiro tri em relação a esse guidance, ele surpreendeu um pouco para cima. Só que ainda tem todo o restante da safra. Então a gente está observando, pode ser que no próximo tri a gente reavalie, se vamos reafirmar essa moagem ou não. Mas o que eu posso te dizer é que o primeiro tri, que já aconteceu, foi um pouco melhor do que a gente esperava. Não é muita coisa, mas qualquer percentual no volume de cana faz diferença no fluxo de caixa. Liquidação do hedge. Você está certo, a sua pergunta é muito boa, por sinal, Bruno.

Speaker #1: And why did we decide to make an adjustment going into a more ethanol oriented mix ? Because the price was 1600 , 1700 per tonne .

no guidance.

uh,

Speaker #1: It was a good moment to have the adjustment . So we made the adjustment of To the point that we realized it would go into ethanol oriented mix , but not at the end of the crop year because we can produce sugar .

Speaker #1: We are not working or supporting our hedge for speculation , but rather for price protection . There is a logic policy to be followed .

Speaker #1: We've adjusted between May and June , but without undoing anything to the end of the crop year . Right ? Because of sugar reentered mix , there was a 80% and now it was 100% .

For.

Speaker #1: It became 100% of available volume . And it turned out to be good , right ? Because once we made the adjustments , it was at very low levels .

[Company Representative] (Jalles Machado): A gente fez um ajuste, porque a gente tinha feito um hedge para um cenário mais açucareiro do que ele passou a ser ali em maio, junho. Por que a gente ajustou nesse momento, já que passou para um cenário mais alcooleiro? Porque o preço estava em BRL 1,600, BRL 1,700 a tonelada. Então era um bom momento para fazer esse ajuste. Então nós ajustamos aquilo que a gente já viu, até quando já ia ser alcooleiro, e não ajustamos no final da safra, porque a gente poderia ainda fazer muito açúcar. A gente não faz hedge para especular, a gente faz hedge para fazer uma proteção dos preços, tem uma política a ser seguida. Então a gente ajustou ali, acho que entre maio e junho, e não desfizemos o que a gente poderia virar mais açucareiro no final. Por isso que ainda ficou 100%.

Rodrigo Penna de Siqueira: It turned out to be good, because once we made the adjustment, it was at very low levels, and then we started working on ethanol, which was better. Now, if sugar pays better, we already have a sugar-oriented mix to the future. If it is so, we can always sell it at better levels than we had bought back. But for the volume that we expect to have of sugar yield, we have 100% of the operation fully hedged. Good explanation. Thank you. Now the question from Citi, but not Gabriel Barra. It is Pedro Gama with Citi who is going to ask a question. Rodrigo Penna and Henrique Penna de Siqueira, thank you for the opportunity to ask you a question. Most of the points have been approached, but I would like to have a follow-up concerning the sales of ethanol and consider climate impacts.

Speaker #1: And then we started working on ethanol , which was better . But now if sugar pays better , we already have a a sugar oriented mix to the future .

Speaker #1: And if it is so , we can always sell it at better levels than we had bought back . But for the volume that we expect to have of sugar yield , we have 100% of the operation fully hedged .

Speaker #1: Good explanation . Thank you Now , the question from city , but not Gabriel Barra . It is Pedro Grammar with city . Who is going to ask a question Rodrigo and Nicky , thank you for the opportunity to ask you a question .

Bruno Tomazetto: Good explanation. Thank you.

Operator: Now the question from Citi, but not Gabriel Barra. It is Pedro Gama with Citi who is going to ask a question.

Ed.

Pedro Gama: Rodrigo Penna and Henrique Penna de Siqueira, thank you for the opportunity to ask you a question. Most of the points have been approached, but I would like to have a follow-up concerning the sales of ethanol and consider climate impacts. Maybe increasing the production of sugar yield, and maybe there would be a reduction in the days for crushing, especially because of El Niño. Do you expect to sell more ethanol in the next crop months? What are your expectations of sugar volume? I would also like to see about the subsidies of ethanol, as you have mentioned, the approval and the pass of the law, and how that would impact your strategy. Thank you.

Speaker #1: Most of the points have been approached , but I would like to have a follow up concerning the sales of ethanol And considered climate impacts Maybe increasing the production of sugar yield And maybe there would be a reduction in the in the days for crushing , especially because of El Nino .

[Company Representative] (Jalles Machado): Você vai lembrar que a gente estava com 80% para a safra, considerando uma safra mais alcooleira. Virou 100% do volume disponível. Acabou sendo bom, porque nessa hora que a gente fez o ajuste

Henrique Penna: estava nas mínimas, e passamos a fazer etanol que estava remunerando melhor. Se o açúcar vier a remunerar melhor para frente, nós já consideramos um cenário açucareiro, que se ele for mais açucareiro ainda, a gente tem condição de vender num patamar melhor do que o que a gente recomprou. Mas, para aquele volume que a gente imagina de fazer de açúcar o mix definido, a gente está com 100% de hedge feito.

Pedro Gama: Maybe increasing the production of sugar yield, and maybe there would be a reduction in the days for crushing, especially because of El Niño. Do you expect to sell more ethanol in the next crop months? What are your expectations of sugar volume? I would also like to see about the subsidies of ethanol, as you have mentioned, the approval and the pass of the law, and how that would impact your strategy. Thank you. Please go on, Pedro. Thank you, Pedro. Well, concerning sugarcane and sugar-oriented mix, there are two points to be made. Sugarcane has low quality, as you pointed out, and there might be more repeated sugarcane because there is not enough time for crushing, because as some of the industries will lose its capacity and will have fewer days for crushing, that may have an impact. In our curve, we have been doing the following analysis.

Speaker #1: Do you expect to sell more ethanol in the next Crop months ? What are your expectations of sugar volume ? And . I would also like would like to see about the subsidies of ethanol .

Bruno Tomazato: Excelente. Perfeito, ficou bem. Obrigado.

No perfect.

Speaker #1: As you've mentioned , the approval and the pass of the law and how that would impact your strategy . Thank you Thank you .

[Company Representative] (Jalles Machado): A pergunta agora é do Citi, mas não é mais Gabriel Barra, é Pedro Gama, do Citi, que vai fazer uma pergunta por voz.

Pedro Gama: Rodrigo, Henrique, obrigado por deixar eu fazer perguntas aqui. Acho que a maior parte dos pontos já foram abordados, mas eu gostaria de fazer um follow-up, especialmente nessa parte da dinâmica de comercialização do etanol, tentando ponderar um pouco qual poderia ser o impacto do clima nessa dinâmica, porque a gente tem ouvido das usinas de São Paulo que algumas gostariam de aumentar o mix de produção de açúcar, só que têm enfrentado alguns problemas com relação à qualidade da cana, e a gente poderia ver uma redução nos dias de moagem nos próximos meses devido às chuvas de El Niño. Eu queria ouvir de vocês se isso poderia trazer um maior volume de vendas de etanol próximo ao fim da safra ou algo do gênero, ou então reduzir um pouco dessa expectativa que vocês têm de volume de açúcar para essa safra, como vocês compartilharam na apresentação.

Rodrigo Penna de Siqueira: Thank you, Pedro. Well, concerning sugarcane and sugar-oriented mix, there are two points to be made. Sugarcane has low quality, as you pointed out, and there might be more repeated sugarcane because there is not enough time for crushing, because as some of the industries will lose its capacity and will have fewer days for crushing, that may have an impact. In our curve, we have been doing the following analysis.

Speaker #1: Pedro Well , concerning sugar cane and sugar oriented mix , there are two points to be made . Sugar cane has low quality .

Speaker #1: As you pointed out , and there might be more repeated sugar cane because there is not enough time for crushing because as some of the industries will lose its capacity and will have fewer days for crushing , that may have an impact in our curve .

Speaker #1: We've been doing the following analysis . Any and all sugar produced during the crop year will be sold during the crop year and whatever is produced of ethanol will be carried over to off season .

Rodrigo Penna de Siqueira: Any and all sugar produced during the crop year will be sold during the crop year, and whatever is produced of ethanol will be carried over to off-season. So we have to analyze prices that are going to give us the more optimized results. I am always comparing price of sugar today with the ethanol price that will be in the future. Therefore, there might be some point in which I decide to change the mix because of that. But still today, when we analyze the ethanol curve into the future, we do not expect to see that upside to make sense and convert it back. These are going to be the factors that will help us make decisions whether we are going to have the maximum mix of sugar or not, and also VHP sugar contracts. This is the first point.

Pedro Gama: Eu queria também tentar pegar um pouco da visibilidade de vocês quanto a essa subvenção do etanol, por conta da aprovação do PLP 114/2026, e como é que isso poderia também impactar na dinâmica de comercialização para o ano. Esses pontos. Obrigado.

Speaker #1: So we have to analyze prices that are going to give us the more optimized results . I'm always comparing Price of sugar today with the ethanol price , they'll be in the future Therefore , there might be some point in which I decide to change the mix because of that .

Henrique Penna: Obrigado, Pedro. Vamos falando, qualquer coisa você me pergunta mais. Sobre a questão da cana e do mix de açúcar, tem essa questão de El Niño, tem dois pontos. Primeiro, que como você falou, a cana ficou de pior qualidade, e a questão que pode ter mais cana bizada, por falta de tempo disponível de moagem. Como as indústrias com mais chuva vão perder capacidade, dias sem moer, isso pode ajudar. Na nossa curva, Pedro, a gente está fazendo a seguinte análise: hoje, todo e qualquer açúcar que eu produza adicional durante a safra, eu vou comercializar na safra. E o que eu fizer de etanol, eu vou levar para a entressafra. Então o preço que a gente tem que avaliar é aquilo que dá o resultado mais otimizado, vamos falar assim.

Period.

Speaker #1: But still today , when we analyze the ethanol curve into the future , we don't expect to see that upside . To make sense .

Speaker #1: And convert it back This is going to be these are going to be the factors that will help us make decisions , whether we're going to have the maximum mix of sugar or not .

Speaker #1: And also the sugar contracts This is the first point . Now , speaking about ethanol sales and the commercialization curve , we are still anticipating prices of season to have good potential , but it will depend on attractiveness and demand .

Rodrigo Penna de Siqueira: Now, speaking about ethanol sales and the commercialization curve, we are still anticipating prices off-season to have good potential, but it will depend on attractiveness and demand. In recent weeks, we have been talking to IBP, the known syndicate, so Vibra, Raízen, and Ipiranga, the main players in the market. We have seen that the demand has gained more and more attraction. We have been talking and in the second part of July, it was 830 in the first part. In the second, weeks would probably be 1 billion for hydrous ethanol. If it really happens, it creates more and more momentum. If the demand increase and reach 2.2 billion per month, there might be a greater upside of season paying much higher than was initially estimated. This is the dynamic we analyze.

Yes.

Speaker #1: In recent weeks , we've been talking to IBP , the known sindicatum . So Vibra Raizen and Ipiranga , the main players in the market .

Henrique Penna: Eu estou sempre comparando o meu preço de açúcar hoje, com o etanol que eu vou ter lá na frente. Isso pode fazer com que em algum momento eu mude novamente o nosso mix em função disso. Mas ainda hoje, quando a gente olha a curva de etanol ali na frente, nós não estamos enxergando um upside tão grande para fazer sentido a gente reverter novamente. Isso que vai ser o nosso decisor final para a gente poder definir se a gente vai continuar mix de açúcar máximo ou não, e os nossos contratos de VHP que a gente vier a fazer. Esse é o primeiro ponto que eu queria comentar. E quando a gente fala de venda de etanol, e qual seria a curva de comercialização, hoje nós ainda estamos enxergando que os preços de entressafra tendem a ter um potencial grande.

Speaker #1: And we've seen that the demand has gained more and more . Attraction We've been talking and In the second part of July , it was 830 .

Mix.

Speaker #1: The first part and the second . It would . Wigs would probably be 1 billion for hydrous ethanol . And if it really happens , it creates more and more momentum .

Speaker #1: And if the demand increase and reach 2.2 billion per month , there might be a greater upside of season pain , much higher than was initially estimated .

Supply.

Speaker #1: This is the dynamic we analyze Nothing is really definitely defined because what is going to be the reaction of the market to this new approval of subsidies ?

Henrique Penna: Mas isso, Pedro, vai depender muito do que a gente está enxergando de tração da demanda. Nas últimas semanas, a gente teve muitas conversas com o pessoal da IBP, que é o antigo Sindicom, que é Vibra, Raízen e Ipiranga, os grandes players do mercado, e a gente tem visto que a demanda deu uma tracionada muito forte. Até a nossa expectativa, em várias conversas de mercado, é que a gente tenha chegado na segunda quinzena de julho. A primeira saiu 830, e a segunda quinzena de julho a gente acha que pode vir acima de 1 bi, de demandas de etanol hidratado no mercado interno. Se isso realmente acontecer, começa a ter uma tração, e essa demanda crescendo e atingindo 2.2 bi por mês, a gente pode vir a ter, sim, um upside maior na entressafra, pagando até bem acima daquilo que a gente espera.

Rodrigo Penna de Siqueira: Nothing is really definitely defined, because what is going to be the reaction of the market to this new approval of subsidies? But if the ethanol changes prices, there might be impact in sugar because they are communicating vessels, right? Supply and demand of sugar and ethanol go hand in hand. Any changes in the market have to be immediately analyzed, and we have to react accordingly. That is great. Thank you. Quite clear. I would like to apologize, Pedro. I said your name wrongly. Pedro Gama with Citi, who asked the last question. We have one more question. Giovanni Taviani, please. Good afternoon. Thanks, everyone. I have two questions. First, you said that in commercialization of 2027, 2028, your average price of sugar is 2,500 and the market is 2,100. As a result of the increase in sugar price, can you also speed up commercialization of sugar?

Speaker #1: But if the ethanol changes , prices , there might be impact in sugar because they are communicating vessels right ? Supply and demand of sugar and ethanol go hand in hand .

I using.

Speaker #1: Any changes in the market . Have to be immediately analyzed . And we have to react accordingly That's great . Thank you . Quite clear I would like to apologize , Pedro .

Pedro Gama: That is great. Thank you. Quite clear.

Operator: I would like to apologize, Pedro. I said your name wrongly. Pedro Gama with Citi, who asked the last question. We have one more question. Giovanni Taviani, please.

Speaker #1: I said your name wrongly . Pedro Gama with city . Who has the last question . We have one more question . Giovanni D'Ottaviano , please Good afternoon Thanks , everyone .

Giovanni D'Ottaviano: Good afternoon. Thanks, everyone. I have two questions. First, you said that in commercialization of 2027, 2028, your average price of sugar is 2,500 and the market is 2,100. As a result of the increase in sugar price, can you also speed up commercialization of sugar? What is your end term to hedge the volume of H1 next year? Based on what you talked about in Jalles Day, you talked about corn ethanol, already working on it. Have you updated your inventory levels or anything along those lines?

Speaker #1: I have two questions . First , you said that in Communalization commercialization of 2728 , your average price of sugar is 2500 and the market is 2100 .

Henrique Penna: Essa é a dinâmica, Pedro. No comercial, a gente fala que nós nunca podemos ter nada escrito na pedra, porque ainda mais com essa mudança, o PLP, o que vai ser a reação que o mercado vai entregar de imediato. Só que quando o etanol muda de preço, a gente sabe que pode ter impacto no açúcar também, porque são vasos comunicantes, sai oferta de açúcar com mix para etanol e vice-versa. Quando tem qualquer mudança no mercado, a gente tem que estar pronto para reagir e aproveitar esse momento.

Speaker #1: As a result of the increase in sugar price , can you also speed up commercialization of sugar ? And what is your end term to hedge the volume of the first half next year ?

Them.

Giovanni Taviani: What is your end term to hedge the volume of H1 next year? Based on what you talked about in Jalles Day, you talked about corn ethanol, already working on it. Have you updated your inventory levels or anything along those lines? Well, Giovanni, I am going to ask Henrique to talk about the commercial side of your question as he is here. Then I will tell you a little bit about the second part of your question about corn ethanol. Thank you for the question, Giovanni. Good afternoon. Well, we have this price of 2,500 for crop year 2027, 2028. We think that our trend for next year crop will be to have maximum sugar-oriented mix. Our plan of crushing, this is the current snapshot, of course, a more sugar-oriented production. Therefore, percentage would be quite close to that.

Speaker #1: And based on what you talked about investors , they you've talked about corn ethanol already working on it . Have you updated your inventory levels or anything along these lines ?

Nice movements.

Pedro Gama: Não, está ótimo, ficou claro, Henrique. Obrigado.

Speaker #1: Well , Giovanni , I'm going to ask Enrique to talk about the commercial side of your question as he's here . And then I'll tell you a little bit about the second part of your question about corn ethanol Thank you for the question , Giovanni .

Rodrigo Penna de Siqueira: Well, Giovanni, I am going to ask Henrique to talk about the commercial side of your question as he is here. Then I will tell you a little bit about the second part of your question about corn ethanol.

[Company Representative] (Jalles Machado): Eu primeiro queria pedir desculpas ao Pedro, que eu pronunciei seu nome errado. Pedro, eu disse teu nome errado. Era Pedro Gama, do Citi, que fez a última pergunta. Temos agora mais uma pergunta de Giovanni Docaviano, por áudio também.

Giovanni Docaviano: Boa tarde, Rodrigo. Boa tarde, Henrique Natal. Obrigado pelo espaço para fazer a pergunta. Eu tenho duas perguntas aqui. A primeira: vocês bem comentaram que na comercialização de 2027, 2028, o preço médio de vocês está em torno do açúcar de 2500 e do mercado está em 2100. Eu queria entender primeiro qual que é a velocidade com que vocês, com essa subida que teve agora do preço do açúcar, com que vocês podem acelerar essa comercialização e qual que é o prazo final que vocês têm para hedgear na política de vocês, do volume do primeiro semestre do ano que vem. Aqui, se puder pegar só um feedback do que a gente conversou no Investor Day, vocês tinham comentado de um projeto de uma planta de etanol de milho, que ainda estava em conversas, enfim, eu queria saber se teve algum tipo de atualização em cima desse tópico.

Henrique Penna de Siqueira: Thank you for the question, Giovanni. Good afternoon. Well, we have this price of 2,500 for crop year 2027, 2028. We think that our trend for next year crop will be to have maximum sugar-oriented mix. Our plan of crushing, this is the current snapshot, of course, a more sugar-oriented production. Therefore, percentage would be quite close to that. Very reliable because we have at our estimates of volume and our hedge based on a sugar-oriented crop. If this is really confirmed, we would have the settlement of hedges as we sell throughout the year. All build up on what we showed you. I do not know if that is the question you had in mind or whether you wanted to know anything else.

Speaker #1: Good afternoon Well , we have this price of 2500 for crop year 27 , 28 . And we think that our trend for next year crop will be to have maximum sugar oriented mix .

Speaker #1: Our plan of crushing the current snapshot . Of course , a more sugar oriented production . Therefore , percentage would be quite close to that .

Speaker #1: Very reliable because we have at our estimates of volume in our hedge , based on a sugar oriented crop . If this is really confirmed , we would have the settlement of hedges .

Henrique Penna de Siqueira: Very reliable because we have at our estimates of volume and our hedge based on a sugar-oriented crop. If this is really confirmed, we would have the settlement of hedges as we sell throughout the year. All build up on what we showed you. I do not know if that is the question you had in mind or whether you wanted to know anything else. No, that is quite clear. Thank you. Rodrigo, please. Well, corn ethanol, it is at the same page as in our last meeting in Jalles Day. It is under study that we want to carry out, but we have been looking into the market and see what it is going to look like if we have more ethanol, sugarcane ethanol, waiting for the presidential elections. We are only going to define whether we are going to go into corn ethanol next year.

Giovanni Docaviano: Obrigado.

Investor Davis.

[Company Representative] (Jalles Machado): Giovanni, eu vou passar para o Henrique falar inicialmente da parte comercial, aproveitando a presença dele aqui, depois a gente fala um pouquinho da segunda pergunta do etanol de milho.

Speaker #1: As we sell throughout the year All build up on what we showed you . I don't know if that's the question you had in mind , or whether you wanted to know anything else No , no , that's quite clear .

Henrique Penna: Giovanni, obrigado pela pergunta. Boa tarde. Realmente, nós estamos com esse preço de 2500 para safra 2027, 2028, e a gente está enxergando que ainda a tendência nossa para safra do ano que vem é ser max açúcar. Então os nossos planos de moagem, no momento atual, essa é a foto de hoje, é a gente vir para uma produção mais açucareira, e aí, de fato, os percentuais seriam bem fidedignos, já que a gente sempre faz as nossas projeções de volume e nosso hedge em cima de uma safra max açúcar. Então, caso isso se concretize, que é a nossa expectativa, é que a gente faça a liquidação dos hedges de acordo com que a gente faça as vendas ao longo do ano, bem em cima daquelas telas que a gente apresentou, realmente. Não sei se é essa que era a pergunta, se a dúvida foi esclarecida.

Giovanni D'Ottaviano: No, that is quite clear. Thank you.

Speaker #1: Thank you So , Rodrigo , please Well , corn ethanol , it's at the same page as in our last meeting . And Charles de it is under study that we want to carry out .

Henrique Penna de Siqueira: Rodrigo, please.

Rodrigo Penna de Siqueira: Well, corn ethanol, it is at the same page as in our last meeting in Jalles Day. It is under study that we want to carry out, but we have been looking into the market and see what it is going to look like if we have more ethanol, sugarcane ethanol, waiting for the presidential elections. We are only going to define whether we are going to go into corn ethanol next year.

Speaker #1: But We've been looking into the market and see what is going to look like if we have more ethanol , sugar cane ethanol waiting for the presidential elections .

Speaker #1: And we are only going to define whether we are going to go into a corn ethanol next year . This year , we are just running internal studies and analysis because if we have lower challenging prices We didn't want to impact our capital structure We didn't want to go into leveraging and considering all the investments , which would be something like 750 million Brazilian reals based on the initial analysis , because there are a number of initiatives that we could really deal with to try to reduce the investments .

Rodrigo Penna de Siqueira: This year, we are just running internal studies and analysis because if we have lower challenging prices, we did not want to impact our capital structure. We did not want to go into leveraging. Considering all the investments, which would be something like BRL 750 million based on the initial analysis, because there are a number of initiatives that we could really deal with to try to reduce the investments. This decision is going to be made probably next year. It is good because now throughout this year of 2026, we are going to analyze how the landscape will be as we have higher supply of ethanol and considering the prices of biofuel. We will only have news about it next year. Great. Thank you. Well, let me remind you that to ask a question, please use the Q&A in the Zoom app.

Giovanni Docaviano: Não, ficou claro, sim. Obrigado, Henrique.

I don't know. No.

Henrique Penna: Vou passar para o Rodrigo.

[Company Representative] (Jalles Machado): Giovanni, como a questão do etanol de milho está na mesma página que estava na última reunião e no Jalles Day. Ali é um estudo que a gente tem a intenção de fazer, mas que nós estamos estudando esse ano um pouco o mercado, como vai ser esse cenário com uma oferta maior de etanol, ver como que vai ser a conjuntura eleitoral e a gente só deve definir se vamos fazer ou não, no próximo ano. Esse ano a gente ficou de fazer exercício, aprofundar estudos e tudo, porque a gente, num cenário de preços mais baixos dos aviadores, a gente não queria atrapalhar ou piorar nossa estrutura de capital. A gente não queria fazer uma alavancagem na ordem do valor que fica esse investimento.

Speaker #1: But this decision is going to be made . Probably next year . And it's good because now throughout this year of 26 , we are going to analyze how the land landscape will be as we have higher supply of ethanol .

Speaker #1: And considering the prices of biofuel We'll only have news about it Next year Great . Thank you Well , let me remind you that to ask a question , please use the Q&A In Zoom app , click there .

Giovanni D'Ottaviano: Great. Thank you.

Is still done.

Operator: Well, let me remind you that to ask a question, please use the Q&A in the Zoom app. Click there, write down your question, or please let us know you want to ask your question using the mic.

Rodrigo Penna de Siqueira: Click there, write down your question, or please let us know you want to ask your question using the mic. You see, Doris, while we are waiting to see if there is any more question, I think we have time for one more question, but we would like to make a point. You are going to see the cash flow in our balance sheet. We have had a reduction of cash and cash equivalent, but it did not happen. There was a change in line. We had an exclusive investment fund to manage our cash position in the quarter, which was accounted for as financial investment. It goes from cash equivalent line and go into financial investments. It is all daily liquidity, immediate liquidity, only public bonds and triple-A banknotes, high liquidity levels, all prefix, just to be able to work with cash management, really, in our cash flow position.

Speaker #1: Write down your question or please ask your questions . Let us know you want to ask your question using the mic You see , Doris Why are we waiting to see if there is any more question ?

[Company Representative] (Jalles Machado): A gente acredita que acima de uns 700, 750 milhões de BRL, pelos estudos que a gente fez, que tem várias alternativas que a gente pode criar para reduzir esse investimento, até parceria e tudo, mas a gente vai tomar essa decisão mais adiante no ano que vem, e é bom que tem um ano que dá para entender bem como vai ficar esse cenário, com uma oferta maior de etanol também nos preços do biocombustível. Vamos falar assim, nós só teremos novidades sobre isso mais para o próximo ano.

Rodrigo Penna de Siqueira: You see, Doris, while we are waiting to see if there is any more question, I think we have time for one more question, but we would like to make a point. You are going to see the cash flow in our balance sheet. We have had a reduction of cash and cash equivalent, but it did not happen. There was a change in line. We had an exclusive investment fund to manage our cash position in the quarter, which was accounted for as financial investment. It goes from cash equivalent line and go into financial investments. It is all daily liquidity, immediate liquidity, only public bonds and triple-A banknotes, high liquidity levels, all prefix, just to be able to work with cash management, really, in our cash flow position.

Speaker #1: I think we have time for one more question , but we would like to make a point You are going to see the cash flow in our balance sheet .

Speaker #1: We've had a reduction of cash and cash equivalent , but it didn't happen . There was a change in line . We had an exclusive investment fund to manage our cash position in the quarter , which was accounted for as financial investment .

Speaker #1: It goes from cash equivalent line and go into financial investments , but it's all daily liquidity , immediate liquidity , only public bonds And triple banknotes , a highly High liquidity levels .

Giovanni Docaviano: Ficou superclaro, obrigado.

[Company Representative] (Jalles Machado): Lembrando, se houver alguma pergunta, por favor, use o botão de Q&A do aplicativo. Clicando nesse ícone, pode escrever a pergunta diretamente ali ou solicitar para fazer uma pergunta por voz.

this is,

Speaker #1: All prefix just to be able to work with cash management really in our cash flow position Wow . You might say well you've been investing cash .

[Company Representative] (Jalles Machado): Doris, enquanto a gente aguarda para ver se vai ter mais alguma pergunta, a gente teria espaço para mais uma, a gente queria até comentar um ponto que vocês vão observar lá na DF, o fluxo de caixa, pelo método indireto da companhia, que a gente teve uma redução de caixa equivalente, mas que não aconteceu. Ela mudou de linha. Foi para aplicações, que a gente fez um fundo exclusivo, para gerir melhor o caixa da companhia durante esse trimestre, que ficou classificado como aplicação financeira. Então ele sai da rubrica caixa equivalente, vai para aplicação financeira. Mas é tudo liquidez imediata, o fundo liquidez diária só tem títulos públicos e papéis de bancos triplo A. É um fundo bem líquido, tudo pós-fixado, sem espaço para marcação a mercado, mas para trabalhar melhor a nossa gestão do caixa.

Rodrigo Penna de Siqueira: While you might say, "Well, you've been investing cash." No, no. The cash is there under financial investments. Well, Rodrigo Penna, I think there are no further questions. I am going to hand it back to you to make your closing remarks. Well, once again, we would like to thank all of you. Thank you for your participation, for your questions. Still challenging situation for the market, but in the past 2 weeks, we have seen an improvement concerning the levels for sugar and ethanol. We have been positively surprised with the yields of irrigated sugarcane in Santa Vitória. When do we want to reach 79 or 80 hectares? It was this year, our initial estimate, but maybe in the next 1 or 2 years.

Rodrigo Penna de Siqueira: While you might say, "Well, you've been investing cash." No, no. The cash is there under financial investments.

Speaker #1: No , no , the cash is there under financial investments . Well , Rodrigo , I think there are no further questions . I'm going to hand it back to you to make your closing remarks Well , once again , we would like to thank all of you .

Operator: Well, Rodrigo Penna, I think there are no further questions. I am going to hand it back to you to make your closing remarks.

Rodrigo Penna de Siqueira: Well, once again, we would like to thank all of you. Thank you for your participation, for your questions. Still challenging situation for the market, but in the past 2 weeks, we have seen an improvement concerning the levels for sugar and ethanol. We have been positively surprised with the yields of irrigated sugarcane in Santa Vitória. When do we want to reach 79 or 80 hectares? It was this year, our initial estimate, but maybe in the next 1 or 2 years. I have no guidance to tell you about that, but we have been observing changes happening in Santa Vitória, and we hope we can have good news from there to share with you in the future.

Speaker #1: Thank you for your participation , for your questions . Still challenging situation for the market , but in the past two weeks , we've seen an improvement concerning the levels for sugar and ethanol We've been positively surprised with the yields of irrigated sugarcane in Santa Vittoria When we went to reach 79 or 80 hectares , it was busier .

Thing.

Speaker #1: Our initial estimate , but maybe in the next 1 or 2 years , I have no guidance to tell you about that . But we've been observing changes happening in Santa Vittoria , and we hope we can have good news from there to share with you in the future .

Rodrigo Penna de Siqueira: I have no guidance to tell you about that, but we have been observing changes happening in Santa Vitória, and we hope we can have good news from there to share with you in the future. Thank you all very much, and hope to see you in our next earnings release call. We are working, and working very hard, and especially this time of challenging prices, it puts the team to be more creative, to come up with alternatives, to do better, do more with less. The team has working diligently to build the budget of the next crop year in a more efficient, competitive fashion, so that the company is properly prepared for our next cycle of commodities increase. We know that commodities have ups and downs, if it is down, we know that it is going to go up inevitably.

[Company Representative] (Jalles Machado): Então só comentar essa alteração, porque a pessoa vai: "Mas teve uma queima de caixa grande". Não, não existiu. Esse caixa foi para aplicações financeiras.

[Company Representative] (Jalles Machado): Rodrigo, não tendo entrada de nenhuma nova pergunta, eu devolvo então a palavra a você, se você tiver mais alguns comentários finais para fazer.

Speaker #1: Thank you all very much and hope to see you in our next earnings release call We are working and working very hard And especially this time of challenging prices , it puts the team to be more creative , to come up with alternatives to do better , do more with less The team has working diligently to build the budget of the next crop year in a more efficient , competitive fashion so that the company is properly prepared for our next cycle of commodities increase .

Rodrigo Penna de Siqueira: Thank you all very much, and hope to see you in our next earnings release call. We are working, and working very hard, and especially this time of challenging prices, it puts the team to be more creative, to come up with alternatives, to do better, do more with less. The team has working diligently to build the budget of the next crop year in a more efficient, competitive fashion, so that the company is properly prepared for our next cycle of commodities increase. We know that commodities have ups and downs, if it is down, we know that it is going to go up inevitably. Let us see if Henrique Penna de Siqueira would like to say anything before we close. Thank you.

[Company Representative] (Jalles Machado): A gente queria, mais uma vez, agradecer a presença de todos, a participação, as perguntas. Um cenário que continua desafiador para o mercado, mas a gente viu, nas últimas 2 semanas, uma melhora em relação aos níveis que estavam, tanto açúcar, etanol. A gente está tendo essas boas surpresas, com as produtividades de cana irrigada lá na Unidade Santa Vitória, que a gente comentou. Guilherme Guttilla tinha perguntado quando que a gente quer chegar nos 79, 80, que era para ser esse ano, mas a gente espera que em 1, 2 anos a gente chegue nesse patamar. Não temos nenhum guidance sobre isso. Mas a gente está vendo as mudanças acontecendo lá em Unidade Santa Vitória, a gente espera ter boas notícias de Unidade Santa Vitória agora para o futuro. Então, é agradecer e aguardar a todos no próximo call de resultados, que a gente vai trabalhar bastante aqui.

Speaker #1: We know that commodities have ups and downs , so if it's down , we know that it's going to go up inevitably Let's see if Enrique would like to say anything before we close .

Henrique Penna de Siqueira: Let us see if Henrique Penna de Siqueira would like to say anything before we close. Thank you. Well, let me thank your time, your questions. Very tough questions focused on hatch, organic sugar, and these are things which tend to deserve more details and additional information. It is always great to answer your questions. If you have any questions, please let us know. Thank you all very much. Thank you. We close now the call with the Q1 2027 of Jalles. Thank you all very much. Have a great afternoon. Thank you.

Speaker #1: Thank you Well , let me thank your time , your questions very tough questions . Focused on hatch organic sugar and these are things which tend to deserve more details and additional information .

Henrique Penna de Siqueira: Well, let me thank your time, your questions. Very tough questions focused on hatch, organic sugar, and these are things which tend to deserve more details and additional information. It is always great to answer your questions. If you have any questions, please let us know. Thank you all very much.

For.

[Company Representative] (Jalles Machado): Essa hora de preços desafiadores é bom que exercita bastante a equipe, em termos de criatividade, em termos de procurar alternativas para fazer melhor, fazer mais com menos. Então a gente tem exercitado bastante a equipe aqui para construir um orçamento da próxima safra com mais eficiência, mais competitividade, para a empresa estar bem preparada para o próximo ciclo de alta de commodities. Porque uma coisa que a gente sabe é que commodities têm ciclo de baixa e de alta. Quando está de baixa, é a única coisa que a gente sabe que uma hora vai melhorar. Queria passar aqui também para o Henrique fazer as considerações finais. Muito obrigado a todos.

Speaker #1: It's always a to answer your questions , if you have any questions , please let us know . Thank you all very much .

Speaker #1: Thank you . We close now the call with the first quarter 27 of Charles . Thank you all very much . Have a great afternoon .

Operator: Thank you. We close now the call with the Q1 2027 of Jalles. Thank you all very much. Have a great afternoon. Thank you.

Foreign foreign.

Foreign.

Henrique Penna: Só agradecer o tempo de vocês, as perguntas todas bem afiadas, em foco no hedge, no açúcar orgânico. São hoje os principais diferenciais que saem um pouco das informações mais públicas. Estamos sempre à disposição aqui. Tendo mais questionamentos, podem estar sempre nos acionando. Obrigado a todos.

[Company Representative] (Jalles Machado): A gente encerra então aqui essa videoconferência do primeiro trimestre de 2027 da Jalles Machado. Tenham todos uma boa tarde, um bom dia. Obrigada.

Operator: Goodbye

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Q1 2027 Jalles Machado SA Earnings Call

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