Azzas 2154 (AZZA3) reports recurring net income of R$ 190.6 million in 3Q26

Gross revenue from continuing brands totaled R$ 3.6 billion, down 3.6%, an improvement in trend from the 7.8% decline in 2Q26. Net revenue was R$ 2.8 billion (R$ 2,844.2 million), a decrease of 4.2%. Gross profit was R$ 1,614.4 million, a change of -0.6%, with a gross margin of 56.8%, up 2.1 p.p. The company attributes the improvement to a lower level of discounts and a greater share of direct-to-consumer sales channels (sell-out).

Recurring EBITDA (earnings before interest, taxes, depreciation and amortization) totaled R$ 466.4 million, down 2.2%, with a margin of 16.4%, up 0.3 p.p. Recurring expenses excluding depreciation and amortization came to R$ 1,155.9 million, stable (-0.1%). In the first nine months of 2026, recurring EBITDA was R$ 1,174.5 million (-18.4%) and recurring net income was R$ 361.0 million (-40.1%).

Operating cash generation was R$ 385.2 million, up 39.6% from 3Q25, when it totaled R$ 275.9 million, with 97% of EBITDA converted into cash. Net debt closed at R$ 2,057.9 million, R$ 69.3 million below 2Q26, and leverage (net debt to recurring EBITDA over the last 12 months) stood at 1.48x, compared with 1.52x in the previous quarter. The financial cycle shortened by 32 days, to 98 days.

The company also reported that CADE approved, without restrictions, the corporate reorganization that will create two publicly traded companies, Arezzo&Co and Grupo SOMA. The decision became final and unappealable on November 4, 2026. The transaction still depends on corporate approvals. FARM Rio will be controlled by Arezzo&Co, with 57.4%, and Grupo SOMA will hold 42.6%.