JALL3: quote, dividends and indicators for Jalles Machado

Jalles Machado S.A. is a company in the Brazilian sugar-energy sector, originating in Goianésia (GO), with a track record that began in 1980 with the creation of the Cooperativa dos Produtores de Cana de Goianésia Ltda. (Cooperálcool), under the leadership of Otávio Lage and local rural producers. Also in 1980, the distillery Goianésia Álcool S.A. was founded and gradually came to concentrate the agricultural and industrial sugarcane activities, including soil preparation, planting, crop management, harvesting, transportation, and industrial processing. In 1993, with the inauguration of the sugar plant and the start of crystal sugar production, the company was renamed Jalles Machado S.A. Açúcar e Álcool, in honor of the controlling family. Over the following decades, the company expanded its activities with sugar exports starting in 1996, ISO 9000 certification in 2000, and pioneering cogeneration of energy from sugarcane bagasse in Goiás, as well as the sale of carbon credits since 2001. The IPO took place in 2021, when JALL3 shares began trading on B3, in the Novo Mercado segment, consolidating the company as a privately held public company headquartered in Goiás.

Jalles Machado’s business model is integrated, covering everything from 100% owned sugarcane production to its processing into sugar, ethanol, electric power, and by-products, as well as higher value-added products classified as non-commodities. The company operates with a diversified portfolio that includes white and VHP sugar, organic sugar, anhydrous, hydrous and organic ethanol, cleaning products, yeast derivatives, soybeans (as a rotation crop), decarbonization credits (CBIOs), bagasse, and other industrial items. Non-commodity products, which exclude white sugar, VHP sugar, and ethanol, accounted for a relevant share of gross revenue in the fiscal years ended March 31, 2025 and 2026, which underscores the importance of higher value-added lines within the operation. Its presence in different links of the chain – agricultural, industrial, energy, and cleaning chemicals – gives the company exposure to multiple markets related to sugarcane and biomass.

Jalles Machado’s industrial operations are concentrated in three units: the Jalles Machado Unit (UJM) in Goianésia (GO), inaugurated in 1982 and continuously modernized, with a crushing capacity of 3.3 million tons of cane per harvest; the Otávio Lage Unit (UOL), also in Goianésia, started in 2011 and currently with a capacity of 3.0 million tons; and the Santa Vitória Unit (USV) in Santa Vitória (MG), acquired in 2022, with an industrial park originally conceived in partnership between Dow Chemical and Mitsui and a capacity of 2.7 million tons. Together, these plants have a total crushing capacity of 9.0 million tons per harvest. The company has been gradually increasing its crushing volume since the 2021/22 harvest, with a relevant average annual growth rate. The agricultural area comprises approximately 94.8 thousand hectares of harvested land, with a fully owned and mechanized sugarcane field, organized under long-term agricultural partnership contracts. The average harvesting radius of around 21.5 km from the mills helps reduce cutting, transshipment, and transportation costs, an important competitiveness factor in the sector.

In the product portfolio, organic sugar plays a central role in the strategy. Produced from certified organic cane, without the use of pesticides or chemical fertilizers, Itajá organic sugar follows strict certification standards, such as those of the Instituto Biodinâmico (IBD), and is mainly aimed at export markets. The product reaches markets in several countries such as Germany, Canada, China, South Korea, the United States, France, Norway, New Zealand, the Netherlands, the United Arab Emirates, Mexico, and others, consolidating Jalles Machado as one of the world’s leading exporters of organic sugar and the largest exporter to the North American market. In addition to organic sugar, the company produces white sugar for the domestic market under the Itajá brand and VHP sugar for export, with a presence in countries such as Switzerland and Uruguay, which expanded after the sugar mill in Santa Vitória came online. In ethanol, its activities include anhydrous ethanol, used in the mandatory blend with gasoline, hydrous ethanol for flex-fuel vehicles, and organic ethanol, aimed at segments such as pharmaceuticals, beverages, cosmetics, food, and alcohol chemicals.

Jalles Machado’s diversification extends to cleaning products, yeast derivatives, soybeans, and CBIOs. In the cleaning products line, the company mainly uses internally produced anhydrous ethanol to manufacture hand sanitizer gel, liquid cleaning alcohol, disinfectants, and other household and professional products, sold under the Itajá and Allgel brands. This category became more relevant in terms of revenue starting in 2020. Yeast derivatives, obtained from surplus from the alcoholic fermentation process, are turned into dry yeast and autolyzed products used as a protein supplement in feed for poultry, swine, cattle, fish, shrimp, horses, and companion animals, with sales in the domestic market and exports of specific lines such as hydrolyzed and autolyzed yeasts. Soybeans are mainly used in crop rotation to renew sugarcane field soils, helping fix nitrogen and control pests and weeds. CBIOs, decarbonization credits created under RenovaBio, are generated from certified biofuel production and traded on B3, providing an additional revenue source tied to the sustainability agenda.

In the energy segment, the company was one of the pioneers in Goiás in cogeneration from sugarcane bagasse. Power is generated by burning bagasse in high-pressure boilers, producing steam to drive turbines coupled to generators. Part of the energy supplies the consumption of the industrial units and the surplus is sold both through long-term contracts and in the free and regulated markets. Taken together, the three industrial units have an installed capacity of 174.5 MW, including the high-pressure park at USV, where 30.9 MW were contracted in an A-5 new energy auction with maturity in 2044. Jalles Machado also participates in cogeneration projects in partnership with Albioma Brasil, through the companies Albioma Esplanada Energia S.A. and Albioma Codora Energia S.A., in which it holds minority stakes of 40% and 35%, respectively. The company also trades carbon credits resulting from the replacement of fossil sources with biomass and has announced a commitment to invest in a project for the production and commercialization of biomethane at the Otávio Lage unit, in partnership with Albioma, expanding the energy use of biomass through 2046.

Jalles Machado’s market covers both Brazil and foreign countries, for sugar, ethanol, and industrial products. In Brazil, the company supplies ethanol to fuel distributors, and sugar and cleaning products to wholesale and retail chains, in addition to serving food, beverage, and other industrial manufacturers. Distribution logistics is predominantly road-based, with domestic sales largely under FOB terms, and relies on sugar distribution centers installed at the company’s own industrial units, which facilitates outflow. Sugar exports, especially organic sugar, are favored by the company’s location in Goiás and Minas Gerais, close to the North-South Railway logistics corridor and its connection with the East-West Railway, which tends to expand modal alternatives for port outflow. In the recent harvest, two customers jointly accounted for around 29.8% of net revenue in the sugar, ethanol, and by-products segment, demonstrating a certain concentration in large buyers, mainly in the AED Goiás and Minas Gerais segment.

Jalles Machado’s activities are heavily regulated by municipal, state, and federal agencies, due to the agroindustrial, energy, and chemical nature of its operations. The units require licenses and permits from city governments, state environmental departments, agencies such as SEMAD in Goiás, DAEE, IBAMA, ANA, ANEEL, ANP, ANVISA, local health surveillance bodies, as well as registrations with MAPA, the Army, the Federal Police, and professional councils such as CREA and CRQ. The company reports that it holds the authorizations and licenses necessary to operate its activities, maintaining renewal processes as required. On the environmental front, its agricultural and industrial activities follow current environmental and land legislation, including preservation and recovery of natural resources and sustainable development practices, with emphasis on certified organic production and the intensive use of biomass for power generation and biofuels. In parallel, its presence in B3’s Novo Mercado, with JALL3 shares, entails adherence to higher corporate governance standards, with a corporate and disclosure structure aligned with the requirements of this segment.