VULC3 Vulcabras

Vulcabras S.A. is a Brazilian company in the footwear and sporting goods sector, with common shares traded on B3 under the ticker VULC3 and listed on the Novo Mercado segment. Founded in 1952 in the city of São Paulo under the name Companhia Industrial Brasileira de Calçados Vulcanizados S.A., it began operations producing leather shoes with vulcanized rubber soles. Over the following decades, the company underwent changes in location, expansion of product lines and corporate restructurings, including the transfer of its facilities to Jundiaí in 1954 and, later, its conversion into a publicly held company in 1977. In 1988, control was acquired by brothers Pedro and Alexandre Grendene Bartelle, a milestone that preceded the consolidation of a broader strategy of operating in the national and regional footwear industry.

Since the 1970s, Vulcabras has built a track record with international sports brands, initially through a licensing agreement for the production and sale of Adidas in Brazil in 1974. Over time, it also worked with other global brands such as Puma, Le Coq Sportif, Reebok, Lotto and Keds, which contributed to enhancing its expertise in brand management in the Brazilian market. Its growth trajectory includes relevant acquisitions, such as the purchase of Calçados Azaleia in 2007, which added brands like Azaleia, Dijean, Olympikus and Opanka and made the company one of the leading footwear manufacturers in Latin America. From the 2010s onward, the company carried out a deep restructuring, focusing on operational efficiency, portfolio rationalization and the discontinuation of less profitable businesses, culminating in positive financial results and the public share offering that enabled its migration to B3’s Novo Mercado in 2017.

Vulcabras’s business model is based on the management, development, production and sale of athletic footwear, other footwear and apparel, operating in a single operating segment. Activities are mainly concentrated in strong, well‑known sports brands, notably Olympikus, Under Armour, Mizuno and Botas Vulcabras. In the fiscal year ended December 31, 2024, the company sold more than 32.4 million pairs of footwear and apparel items, including 25.6 million pairs of shoes, reaching net sales revenue of R$ 3.048 billion. The company operates across all stages of the value chain of its core business, from product research and development, sourcing and manufacturing to marketing and distribution, combining in‑house production in Brazil with partial outsourcing of components, specific footwear, apparel and accessories from domestic and international suppliers.

The brands operated by Vulcabras occupy different positions within the sports products market. Olympikus, a traditional Brazilian brand, has a broad portfolio of footwear and apparel, with more than 100 new footwear models and 150 apparel items launched annually, a strong presence in the running category and distribution in thousands of points of sale. Under Armour has been part of the company’s portfolio since 2018, through an exclusive licensing agreement for Brazil covering footwear, apparel and accessories, with a focus on innovation for athletes and consumers with an active lifestyle. Mizuno, whose operations in Brazil were acquired in 2020, strengthens Vulcabras’s presence in the running performance category, with proprietary technologies such as the Wave plate and U4ic compound, and a more premium positioning in the running segment. The company also maintains the Botas Vulcabras brand and holds licensing agreements such as that of the Melissa brand for the production of sports shoes, as well as licensing the Azaleia brand to third parties in selected markets.

From an industrial standpoint, Vulcabras operates a labor‑ and technology‑intensive industrial park, with production units located mainly in the states of Ceará and Bahia, where it concentrated its Brazilian production from the late 1990s onward and after the closure of the Sergipe plant in 2020. The production process ranges from the preparation of compounds for rubber, PVC, PU, EVA and TPU soles to cutting, sewing, knitting of uppers on flat knitting machines, assembling, finishing and quality inspection. The company controls the development of tools, dies and molds and uses automated equipment such as laser cutting machines and computerized cutting systems. The production of apparel and accessories is outsourced, allowing greater flexibility to serve different markets and product categories. The company invests continuously in modernizing its industrial park and, in 2022, expanded capacities in Ceará and Bahia with new pavilions and equipment, reinforcing its industrial base in the country.

Vulcabras’s research and development area is a central element of its strategy. The company maintains in Parobé, Rio Grande do Sul, an R&D center for athletic footwear considered one of the most relevant in Latin America, with an area of over 20,000 m², a laboratory, design center, mini‑factory, virtual reality resources and materials research. This complex employs hundreds of staff dedicated to the development of new products, technologies, production processes and compounds, in line with international trends and in cooperation with universities. Over the past five years, the company has allocated a significant amount of resources to production and R&D modernization, which has enabled launches such as the Olympikus Corre Grafeno, a running shoe with a graphene plate, and the expansion of the running portfolio across different price ranges. The integration between R&D and local production significantly reduces the time to develop and bring products to market compared with competitors dependent on imports.

Vulcabras’s product distribution combines physical and digital channels and broad commercial reach. In the domestic market, the company operates through a network of 52 commercial representation offices, its own sales force and direct relationships with major retail chains and specialty stores. The online channel includes proprietary e‑commerce platforms for the main brands, integrated with a distribution center dedicated to digital operations in Extrema, Minas Gerais, opened in 2021, and presence on the country’s main marketplaces. In 2024, online sales accounted for 14.2% of net sales revenue. The company also operates its own stores in Brazil, including Under Armour and Mizuno outlet stores and multi‑brand factory stores. Internationally, Vulcabras operates a distribution subsidiary in Peru, with its own network of Azaleia and Olympikus brand stores, and works through partners such as Grupo Forus in Chile and distributors in other Latin American countries, with the foreign market accounting for a minority share of consolidated revenue.

Vulcabras’s activities are subject to a set of rules and regulations related to the manufacture, distribution and sale of footwear and apparel. Its industrial units, distribution centers and stores require environmental permits, operating licenses, authorizations for the use of controlled products, water‑use concessions and fire department inspection certificates, in addition to complying with labor, social security, health and tax legislation at all levels. The company is registered with IBAMA’s Federal Technical Registry (Cadastro Técnico Federal) for potentially polluting activities and states that it operates in compliance with applicable requirements, including occupational safety standards and environmental licenses relevant to the use of raw materials, waste management, water resources and air emissions. Regulatory risk management includes monitoring potential changes in environmental and social legislation, which may require additional compliance investments.

In the environmental, social and governance field, Vulcabras has been incorporating practices aligned with the demands for sustainability and corporate responsibility. In 2022, it began using wind power in the production of 100% of the shoes manufactured at its Brazilian plants, through a contract with a wind power generation company, reducing the carbon footprint associated with its industrial activity. In the same year, it received the ESG‑Fiec Seal, awarded by the Federation of Industries of the State of Ceará, after an assessment of initiatives such as the creation of a sustainability committee, promotion of the circular economy, water reuse, waste management and environmental education programs. From a social and labor perspective, the company states its commitment to safe and healthy working conditions, respect for labor rights, promotion of quality of life for employees and the adoption of a Code of Ethics and Conduct based on principles of integrity and respect for human rights, in line with national and international guidelines on the subject. The combination of industrial, commercial and governance practices shapes Vulcabras’s profile as a relevant company in the footwear and sporting goods market, with VULC3 shares listed on B3 and a growing presence in the sports segment in Latin America.