Lavoro Limited

Preliminary consolidated revenue for fiscal second quarter 2025 declined 27% year over year to BRL 2.25 billion; in U.S. dollars, revenue declined 38% year over year to $384 million, with the change also reflecting a 15% depreciation of the Brazilian real. Preliminary consolidated gross profit decreased 28% to BRL 366 million, and consolidated gross margin contracted 40 basis points to 16.3%. By segment, Brazil Ag Retail revenue fell 30% to BRL 1.84 billion, Crop Care revenue fell 30% to BRL 251 million, and Latam Ag Retail revenue rose 4% to BRL 287 million. Gross margin was 11.5% in Brazil Ag Retail, 22.6% in Latam Ag Retail, and 23.7% in Crop Care. Management withdrew its fiscal 2025 outlook and did not provide next-quarter or full-year guidance.

Ruy Cunha framed the quarter as being hit by severe industry headwinds, including 40% to 60% input price deflation, drought, farmer liquidity constraints, and supplier financing disruption after a peer restructuring. He said the new extrajudicial reorganization plan is intended to create a standardized multiyear supplier framework, support a new FIDC, and make Lavoro Brazil leaner and more resilient. His tone was defensive but constructive, emphasizing that the company sees the long-term thesis as intact and is taking decisive actions to restore profitability.

No separate CFO remarks were provided. The financial commentary focused on preliminary unaudited results: BRL 2.25 billion of revenue, BRL 366 million of gross profit, and 16.3% gross margin, with Brazil Ag Retail at 11.5%, Latam Ag Retail at 22.6%, and Crop Care at 23.7%. Management also said the reorganization plan covers approximately BRL 2.5 billion of supplier trade payables and that repayments would be spread in regular semiannual installments over multiple years.

There was no Q&A session. Management said it could not host analyst questions because of ongoing court proceedings and because the second quarter audit process had not been finalized. As a result, the call contained no back-and-forth on detailed financial assumptions, but management did address the restructuring scope, noting it applies only to Lavoro Brazil suppliers and does not include financial lenders, creditors, contractors, or employees.