In the first quarter of 2024, Dexco (DXCO3), formerly known as Duratex, recorded a net loss of R$39.4 million, reversing a profit of R$147.6 million in the same period of the previous year.
During this period, the company’s net revenue reached R$1.9 billion, marking an increase of 13% compared to the previous year. This positive performance is attributed to the improvement in all its divisions, especially in the Wood division, where the panels and forestry business segments stood out.
In the finishing division, the evolution was driven by the improvement in the product mix in metals and ceramics, together with the increase in market share in coatings, resulting in an increase in sales volume.
However, the cost of goods and services sold in the first quarter totaled R$1.3 billion, representing an increase of 32% compared to the same period of the previous year.
Dexco (DXCO3)
It is worth remembering that three weeks ago Goldman Sachs revised its recommendation for the company’s shares, raising it from neutral to purchase, with a target price of R$9.50 over a 12-month period. This represents an expected increase of 30.5% in relation to the value of the stock in the last trading session, when it was quoted at R$7.28. At around 3pm, Dexco shares were being traded at R$7.48, registering an increase of 2.75%, ranking among the biggest rises on the Ibovespa in the period.
According to analysts Marcio Farid, Gabriel Simões and Henrique Marques, Dexco is entering a turning point in its business, characterized by the end of an investment cycle and the prospect of reaping the fruits of these contributions, returning to presenting a positive cash flow .
The company’s last years were marked by significant investments, at the same time as there was a loss of profitability in the Sanitaryware and Metals (Deca) and Ceramic Finishes divisions, in addition to an increase in debt and interest expenses. These challenges were faced amid a period of cooling in demand for construction materials after the peak seen in the months following the start of the pandemic.
Investment plan
Dexco announced a strategic investment plan of R$2.5 billion for the coming years, which was reduced to R$1.8 billion due to the adverse macroeconomic scenario. This plan encompasses the automation of sanitary ware plants, improvements in wood panel factories, expansion of the forestry base and a new ceramic tile production unit.
