By Brazil Stock Guide – Companhia Brasileira de Alumínio reported weaker fourth-quarter results as higher production costs and lower margins outweighed the benefits of stronger aluminum prices in global markets.
The Brazilian aluminum producer posted a net loss of R$164 million in the fourth quarter of 2025, compared with a loss of R$56 million in the same period a year earlier.
The company’s adjusted EBITDA fell to R$257 million in the quarter, a 47% drop from the previous year. On a pro forma basis, excluding a R$64 million accounting reclassification from capital expenditure to operating costs, EBITDA would have reached R$321 million.
Aluminum prices rise but margins weaken
The average aluminum price on the London Metal Exchange reached $2,827 per ton during the quarter, about 10% higher year-over-year. The increase was supported by lower U.S. interest rates, a weaker dollar and stronger investor demand for commodities.
Despite the stronger pricing environment, profitability was pressured by rising input costs, particularly energy and alumina. The average cost of producing liquid aluminum climbed to R$12,847 per ton, up 13% from the same quarter in 2024.
Energy costs alone increased 24% due to lower hydroelectric generation and the need to purchase additional power at higher market prices.
Revenue declines while aluminum sales remain stable
CBA reported consolidated net revenue of R$2.2 billion in the quarter, down 4% from the same period last year. Revenue from its aluminum business totaled R$2.1 billion, falling 5% year-over-year.
Aluminum sales volumes reached 128,000 tons, a 2% increase compared with the fourth quarter of 2024, driven mainly by stronger primary aluminum shipments.
Sales of primary aluminum totaled 71,000 tons, up 8% year-over-year, supported by increased shipments of P1020 ingots. Meanwhile, transformed aluminum products declined 8% year-over-year to 32,000 tons, reflecting slower industrial demand.
Financial position and leverage
CBA ended the quarter with net debt of about R$3.3 billion and a leverage ratio of 2.97 times net debt to adjusted EBITDA over the last twelve months.
Gross debt stood at roughly R$4.3 billion at the end of December 2025, slightly higher than the previous quarter due to currency effects from the depreciation of the Brazilian real against the U.S. dollar.
Ownership change under negotiation
In January 2026, the company’s controlling shareholder, Votorantim S.A., signed a share purchase agreement with Aluminum Corporation of China Ltd. and mining group Rio Tinto (RIO).
The deal involves the sale of Votorantim’s 68.6% stake in CBA (CBAV3) at a base price of R$10.50 per share. The transaction remains subject to regulatory approvals and other customary closing conditions.
If completed, the agreement would transfer control of the Brazilian aluminum producer to the buyers and trigger a mandatory tender offer for remaining shareholders.
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