Dexco Q3 earnings show resilience despite downturn
27 October 2022Brazilian wood-based panels manufacturer Dexco (formerly known as Duratex) showed resilience in its Q3 earnings, despite a downturn from a year ago.
The wood division recorded adjusted and recurring Q3 EBITDA of R$276.1m, 28% below that for 3Q21. The result for the first nine months was R$895.4m, 18% below the same period in 2021.
Despite the downturn, the Division increased market share and maintained its position in the external market. In Q3, the wood panels market saw a fall in sales volumes of 9.2% versus 3Q21, with the domestic market shrinking 11.5% and exports growing 13.0%, according to data released by IBA´.
Sales volumes, despite being lower than that reported by the company for the same quarter of 2021, exceeded the result of prior quarter, on the back of a slight uptick in the retail channel and ongoing sales to the industrial channel.
With respect to exports, the reductions seen in sea freight costs, while still leaving costs high, led to an increase in export volumes versus the prior quarter, although volumes were still lower than those reported for the same period in 2021.
High prices continue to benefit the Division’s unit revenue, which increased by 15.1% versus the same quarter of 2021, remaining at the same levels seen in 2Q22. Year to date, average unit revenue was 23.1% higher than in 2021.
Inflationary pressures on the cost of the main panel production inputs and materials, especially commodities, continues to be a challenge for the Division.
Dexco reported investment of R$76.3m in the first nine months of the year in manufacturing projects aimed at debottlenecking, the acquisition of equipment for expanding the capacity of panel coating and on increasing base forestry assets in the Northeast.
