ORVR3 Orizon

Orizon Valorização de Resíduos S.A. is a Brazilian publicly traded company dedicated to waste management and recovery, with common shares traded on B3 under the ticker ORVR3, listed on the Novo Mercado corporate governance segment. The company traces its origins to Haztec Tecnologia e Planejamento Ambiental S.A., created in 1999, and Haztec Investimentos e Participações S.A. (HIP), incorporated in 2009 as a holding company to consolidate shareholders’ investments in environmental businesses. In 2013, after a growth cycle supported by private equity and acquisitions in different environmental services segments, the entry of Inovatec Participações S.A. as a reference shareholder marked the reorganization of the group with a more concentrated focus on waste treatment and final disposal, biogas exploitation and environmental services. This shift was accompanied by the sale of assets considered non-strategic and by an operational and financial restructuring.

The IPO took place in February 2021, when Orizon carried out its initial public offering and its ORVR3 shares began trading on B3, in a predominantly primary offer. From the IPO onwards, the company consolidated its business model based on ecoparks, complexes with sanitary landfills and associated infrastructure for waste recovery, including biogas capture, power generation, biomethane production, mechanical sorting units and organic fertilizer plants. At the end of 2021, the company operated five ecoparks and received around 4.8 million tons of waste per year, which generated net operating revenue of approximately R$ 392 million. In subsequent years, its strategy focused on expanding the portfolio through acquisitions of sanitary landfills and waste recovery assets, as well as strengthening capital through a private capital increase completed in 2022.

Orizon’s business model is structured into four main operating segments: treatment and final disposal of hazardous and non-hazardous waste; energy, biogas and carbon credits; waste processing and waste-to-energy; and, until the decision to discontinue it, environmental engineering. In 2024, the treatment and final disposal segment accounted for 72% of net operating revenue of R$ 903.5 million, remaining the backbone of the company’s value chain. The energy, biogas and carbon credits vertical represented 19% of revenue, waste processing and waste-to-energy around 6%, while environmental engineering contributed approximately 3%, already in the wind-down phase. The company’s activities are concentrated in the final stage of the waste chain, with no involvement in collection, street sweeping or urban cleaning services, which positions it as a specialist in infrastructure and disposal and recovery solutions.

In the treatment and final disposal segment, Orizon operates, directly or indirectly, 17 sanitary landfills for non-hazardous waste, four plants for hazardous waste treatment and transfer stations, distributed across 12 Brazilian states. In 2024, its ecoparks received around 8.7 million tons of waste, equivalent to approximately 11% of the municipal solid waste collected in Brazil, according to ABREMA data, and about 18% of the total appropriately disposed of in the country. Operations follow engineering standards that include base lining, leachate drainage systems, biogas capture, geotechnical control and groundwater monitoring, with a focus on mitigating environmental impacts. The customer base in this division is diversified between the public sector, which accounted for around 56% of the segment’s revenue in 2024, and private companies from different sectors, with long-term contracts with public entities that can last up to 30 years.

The energy, biogas and carbon credits vertical harnesses the energy potential of the waste received at the ecoparks. The company captures biogas in its landfills through vertical drainage wells connected to suction, treatment, and flaring or energy recovery systems, with an average flow captured in 2024 on the order of 61,785 Nm³/h. Part of this volume is converted into electricity, as at the Barra Mansa ecopark, which generates around 2 MW for distributed generation projects, while other projects in Jaboatão dos Guararapes and João Pessoa are under development for power generation from biogas. In Paulínia, biogas is used as feedstock for biomethane production by a thermoelectric plant in which Orizon holds a significant interest, while the Tremembé landfill generates royalties from the use of biogas in a power generation project. The company also monetizes carbon credits arising from methane flaring and the replacement of fossil fuels, having recorded generation of approximately 3 million tons of carbon in 2023 and around 3.5 million in 2024.

In the circular economy field, Orizon develops waste processing, mechanical sorting and composting activities, as well as waste-to-energy projects. The industrial processing units transform waste from sectors such as oil and gas, steel, pulp and paper, chemicals and mining into co-feedstock or alternative fuels, including blending for co-processing and reverse logistics. The mechanical sorting units, located in cities such as Jaboatão dos Guararapes and Paulínia, separate recyclables – plastics, paper, glass and metals – and produce refuse-derived fuel (RDF), which can replace coke in cement plants and generate recycling certificates. In composting, the company operates, in partnership with Tera Ambiental, a plant in Paulínia focused on treating sludge from wastewater treatment plants, resulting in marketable organic fertilizer. In waste-to-energy, the company is involved in the first large-scale energy recovery plant project in Latin America, in partnership with Sabesp, still under development.

Orizon’s geographical presence is nationwide, with 17 ecoparks in operation distributed across the states of Rio de Janeiro, São Paulo, Minas Gerais, Pernambuco, Alagoas, Sergipe, Paraíba, Mato Grosso, Goiás, Rondônia, Ceará and Rio Grande do Norte, in addition to transfer units and processing plants in different municipalities. In 2024, the company’s ecoparks served more than 22 million inhabitants, with a total volume received of approximately 8.8 million tons of waste. Recent expansion included the acquisition of ecoparks in regions such as Cuiabá, Aparecida de Goiânia, Porto Velho, Santa Luzia and Juazeiro do Norte, as well as the extension of the João Pessoa Ecopark concession term by 20 years, until 2043. In 2022, the company strengthened its portfolio by acquiring the UPI Aterros from Grupo Estre, composed of seven sanitary landfills and a waste recovery plant, and assets located in Cuiabá.

Orizon operates in a heavily regulated environment that combines environmental regulations and public-sector contracting rules. The provision of services to municipalities, states and other governmental entities is carried out through administrative contracts governed by the New Bidding Law, the Concessions Law or the Public-Private Partnerships Law, depending on the model adopted. These contracts generally involve bidding processes intended to ensure equal treatment among competitors, with investment, operation and maintenance obligations for sanitary landfills and associated structures on the part of the concessionaire or contractor. On the environmental front, operations depend on specific permits for the construction and operation of sanitary landfills, hazardous waste treatment plants, power generation from biogas and biomethane production, subject to oversight by federal, state and municipal environmental agencies. The importance of final waste disposal and energy recovery services creates entry barriers associated with the need for intensive capital, compliance with technical standards and regulatory requirements.

From an environmental, social and governance perspective, Orizon bases its business on the proper disposal of solid waste, reducing greenhouse gas emissions through the capture and flaring of biogas and the replacement of fossil fuels with biomethane and RDF. The company works to mitigate liabilities associated with dumps and irregular landfills, operating sanitary landfills with infrastructure to control impacts on soil, water and air, and developing circular economy solutions involving recyclable recovery, organic fertilizer production and renewable energy generation. On the social side, its operations are directly linked to the provision of services deemed essential by different levels of government, reaching millions of people in urban centers and metropolitan regions. In governance, its listing on B3’s Novo Mercado implies requirements such as capital composed exclusively of common shares and practices of transparency and protection of minority shareholders, reflecting a corporate structure aligned with the highest governance standards of the Brazilian capital market.