BRAZIL - Eucatex, one of the largest manufacturers of wooden panels in Brazil, with operations also in the paint, varnish, laminated flooring and doors segments, announced its results for the 1st quarter of 2022 (1Q-2022). Total sales revenue in 1Q-2022 was BRL 597.8 million, compared to BRL 529.7 million in 1Q-2021, up 12.9%.

In the Wood Segment, revenue grew 10.8% in the quarter, mainly reflecting the increase in sales prices in both the domestic and export markets in relation to 1Q-2021.

Sales volume in the Company’s Wood segment, considering both domestic and export markets, decreased 11.4% in 1Q-2022, compared to the same period last year. Performance in the quarter was impacted by the volume decline in both domestic sales (-13.0%) and exports (-3.9%).

Recurring EBITDA totaled BRL 123.2 million, down 2.8% from 1Q-2021. Recurring EBITDA Margin in 1Q-2022 reached 20.6%, decreasing 3.3 p.p. from the same period last year.

Recurring Net Income (profit) in 1Q-2022, excluding the effect of non-recurring expenses and net of income tax, totaled BRL 86.1 million.

Investments in 1Q-2022 totaled BRL 43.0 million and were allocated to maintaining the Company’s industrial and, chiefly, forest operations.

Domestic demand fell sharply across all of the Company's businesses t in 1Q-2022. The negative impact of the loss of purchasing power of the population due to high inflation, which, combined with the tightening of monetary policy, makes the scenario for 2022 challenging.

In 1Q-2022, costs increased sharply but could not be passed on to prices due to weak demand. On the other hand, the Export Market has witnessed strong demand, but logistics difficulties, lack of ships and containers, and high freight rates have made it difficult to seize these opportunities.