Q3 2025 WEG SA Earnings Call (English, Portuguese) Transcript
Key Points
- Weg SA (WEGZY) reported positive demand for motors and appliances, particularly in China and North America, with contributions from operations in Turkey.
- Revenue growth in Coatings and Varnishes was supported by strong performance in Mexico and a recent acquisition in the United States.
- The company announced significant investments, including a BRL1.1 billion plan in Santa Catarina and a USD77 million investment in Missouri, to expand production capacity.
- Weg SA (WEGZY) is focusing on becoming a solutions provider, particularly in e-mobility, microgrid, and network reliability, aligning with its strategy to offer complete solutions.
- Despite geopolitical challenges, the company expects annual revenue growth and high operating margins, supported by its international presence and diversified product portfolio.
- EBITDA margin for the quarter was slightly lower than the same period last year due to higher raw material costs.
- The geopolitical and macroeconomic environment presents short-term challenges that require close attention.
- There was a significant drop in generation revenue, particularly in Europe and Asia Pacific, due to weaker performance and reduced project deliveries.
- The company faces challenges in the domestic GTD market, with a decline in solar projects and a lack of new wind power projects.
- Tariffs and price adjustments in the US market are impacting competitiveness, with potential effects on volume and margins.
(audio in progress) motors and appliance demand remained positive, particularly in China and North America, along with contributions from Bolt Electric Motor Operations in Turkey.
In Coatings and Varnishes, revenue growth was supported by strong performance in Mexico and the recent acquisition of the operations of Hear Sight in the United States. Slide 6 23%, while EBITDA margin closed the quarter at 22.2%. Although slightly lower than the same period last year, mainly due to higher cost of some raw materials. EBITDA margin remained strong, supported by the current product mix.
Finally, on Slide 7, we show the evolution of our investments, which totaled BRL673 million with 72% in 52% in Brazil and 48% abroad. In Brazil, we continue to modernize and expand production capacity at T&D while increasing capacity and productivity at our (inaudible) Internationally, we continue investments in Mexico, particularly the progress in building the new transformer factory and in the expansion of
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