SAO PAOLO, BRAZIL – WEG S.A. held its Q1 2024 Earnings Conference Call on May 3, 2024. The company reported a 4.4% increase in net revenue compared to the first quarter of 2023. In Brazil, strong performance was noted in long cycle equipment, particularly in the transmission and distribution of wind energy sectors. Internationally, there was good demand in generation, transmission, and distribution, with growth opportunities in North America.

EBITDA reached R$1.8 billion, reflecting a 4.8% increase from the same period last year. The EBITDA margin ended at 22%, up 0.1 percentage points year-over-year. Additionally, Return on Invested Capital (ROIC) saw a significant increase to 38.9%, marking a 7.5 percentage point rise from Q1 2023. The company highlighted the positive impact of tax incentives in the previous year on ROIC.

WEG also shared insights on its business revenues in various segments, noting strong performance in Brazil for both short and long-cycle products. In the international market, demand for short-cycle products saw a decline, impacted by factors such as foreign exchange rates, reduced demand in certain regions, and inventory adjustments by key customers.

The company discussed its investments, with a focus on expanding industrial engine plants in Brazil and increasing production capacity in Mexico and China. This strategic approach aims to support future growth and meet market demands. WEG emphasized its commitment to operational excellence and continuous improvements in efficiency and productivity.

During the Q&A session, analysts inquired about various topics such as the integration of recent acquisitions, market dynamics, pricing strategies, and future growth opportunities. WEG’s management provided detailed responses, outlining strategies to optimize margins, capitalize on market trends, and drive long-term profitability.

Overall, the conference call highlighted WEG’s solid financial performance, strong market position, and strategic initiatives to drive sustainable growth. The company remains focused on delivering value to shareholders, enhancing operational efficiency, and capitalizing on emerging opportunities in the global market.