Lavoro Ltd 6-K, filed Nov 5, 2025
Lavoro Ltd (LVROF)
About this 6-K
Lavoro Ltd filed this 6-K on November 5, 2025.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of November 2025
Commission File Number: 001-41635
Lavoro Limited
(Exact name of registrant as specified in its charter)
Av. Dr. Cardoso de Melo, 1450, 4th floor, office 401
São Paulo - SP, 04548-005, Brazil
+55 (11) 4280-0709
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Form 20-F | X |
| Form 40-F |
|
TABLE OF CONTENTS
1. | |
2. | Lavoro Limited Preliminary Unaudited Financial Information for Fiscal Year 2025 |
Financial Statements of Lavoro Brazil
Pursuant to the requirements of the Agribusiness Receivables Certificates (Certificados de Recebíveis do Agronegócio or CRA) of Lavoro Agro Holding S.A. (“Lavoro Brazil”) (the principal operating subsidiary of Lavoro Limited in Brazil) Lavoro Brazil is required to disclose its financial statements for the year ended June 30, 2025, in Brazil. An English translation of the financial statements is furnished herewith as Exhibit 99.1.
For clarity, reporting for Lavoro Brazil is not directly comparable to the Brazil Ag Retail operating segment as Lavoro Brazil includes Perterra Trading S.A. and Perterra Distribuidora de Insumos S.A., which are reported within the Crop Care segment.
The conclusion of certain audit procedures for Lavoro Brazil’s financial statements for the year ended June 30, 2025 remain subject to the Company’s provision of appropriate and sufficient audit evidence, including supporting documentation and the conclusion of the court ratification process for Lavoro Brazil’s out-of-court restructuring plan.
Lavoro Limited Preliminary Unaudited Financial Information for Fiscal Year 2025
Lavoro Limited (“Lavoro” or the “Company”) is furnishing certain preliminary, unaudited information for the fiscal year ended June 30, 2025 (“FY25”). As disclosed in a Form 12b-25 filed with the Securities and Exchange Commission on November 3, 2025, certain required accounting and disclosure procedures cannot be finalized until Lavoro Brazil’s out-of-court restructuring plan (the “EJ Plan”) is ratified by the court (homologation). As a result, the filing of the Company’s Annual Report on Form 20-F has been delayed.
Pending completion of these procedures, the Company is providing preliminary unaudited FY25 information limited to revenue and gross profit. This preliminary information has not been audited and remains subject to change.
Court ratification of the EJ Plan is currently expected in late November 2025, subject to court scheduling and other factors outside the Company’s control. If obtained, such ratification could enable completion of audit accounting and disclosure procedures by late December 2025. The timing remains uncertain, and there can be no assurance that the Company will file its Annual Report on Form 20-F within that timeframe.
Out-of-Court Reorganization Plan Updates
On September 9, 2025, Lavoro disclosed that it had obtained statutory majority support from supplier creditors, reaching the threshold required under Brazilian law for court ratification (homologation) of its out-of-court reorganization plan (the “EJ Plan”).
Since that disclosure, additional suppliers have adhered to the EJ Plan. As of the date of this filing, creditors representing approximately 64% in value of eligible supplier claims support the plan, compared with approximately 52% as of September 9, 2025. Supporting suppliers include Adama Brasil, UPL Brasil, FMC Agrícola, BASF, Ourofino, and EuroChem.
The terms and structure of the EJ Plan remain unchanged from those described in the Company’s June 18, 2025 announcement. In accordance with the EJ Plan, Lavoro Brazil completed the first tranche of payments to supplier creditors in September,
Consolidated Financial Information
FY25 preliminary unaudited consolidated revenue decreased approximately 34% year-over-year (y/y) to approximately $6.2 billion, primarily due to inventory shortages in Brazil Ag Retail during key portions of the crop inputs selling season, and which resulted in resulted in significant order cancellations throughout the year.
FY25 preliminary unaudited consolidated gross profit decreased approximately 33% to approximately R$0.9 billion, driven by the revenue decline, partly offset by gross margins expansion reflecting favorable segment mix shifts, as well as an increase in distribution margins in Latam Ag Retail, partly offset by a decrease in margins in Brazil Ag Retail and Crop Care.
Preliminary Estimates
This Form 6-K contains certain preliminary estimated financial information of the Company as of the year ended June 30, 2025. Such preliminary information is not yet finalized, remains subject to completion and reflects management’s current estimates. The preliminary estimated financial information is subject to the finalization and closing of the accounting books and records of the Company (which have yet to be performed) and should not be viewed as a substitute for financial statements prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standard Board. While carrying out such procedures, the Company may identify items that require adjustments to the preliminary estimates set forth in this Form 6-K. In addition, other developments may arise between the date of this Form 6-K and the date that the Company reports the results for the year ended June 30, 2025, which may cause actual results to be different than the preliminary estimates set forth in this Form 6-K. There can be no assurance that the Company’s final results will not differ from these preliminary estimates, which are forward-looking statements based only on currently available information as of the date hereof. Therefore, you should not place undue reliance on these preliminary estimates nor should you view these as a substitute for the Company’s audited financial statements for the year ended June 30, 2025. No independent registered public accounting firm has audited, reviewed or compiled, examined or performed any procedures with respect to these preliminary results, nor have they expressed any opinion or any other form of assurance on the preliminary results.
The preliminary information is presented for informational purposes only and does not purport to represent the Company’s financial condition or results of operations for any future date or period. As a result, caution should be exercised in relying on this information and no inferences should be drawn from this information regarding financial or operating data not provided.
Forward-Looking Statements
Certain statements made in this Form 6-K are “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “aims,” “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, anticipated results of operations. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as and must not be relied on by any investor as, a guarantee, an assurance, a prediction, or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of the Company.
In addition, forward-looking statements reflect the Company’s expectations, plans, or forecasts of future events and views as of the date of this Form 6-K. The Company anticipates that subsequent events and developments will cause the Company’s assessments to change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company’s assessments as of any date subsequent to the date of this Form 6-K. Accordingly, undue reliance should not be placed upon the forward-looking statements.
EXHIBITS
EXHIBIT |
|
99.1 |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
| Lavoro Limited | |||
|
|
| |||
|
|
| |||
|
|
| By: | /s/ Ruy Cunha | |
|
|
|
| Name: | Ruy Cunha |
|
|
|
| Title: | Chief Executive Officer |
Date: November 4, 2025
Exhibit 99.1
1
Index |
|
|
|
|
|
Financial Statements |
| |
| 2 | |
| 4 | |
| 5 | |
| 6 | |
| 7 | |
|
|
|
Management's Notes to the consolidated and separate financial statements |
| |
|
|
|
1. | 9 | |
2. | 10 | |
3. | 12 | |
4. | 14 | |
5. | 14 | |
6. | 15 | |
7. | 19 | |
8. | 25 | |
9. | 26 | |
10. | 26 | |
11. | 28 | |
12. | 28 | |
13. | 31 | |
14. | 35 | |
15. | 37 | |
16. | 38 | |
17. | 39 | |
18. | 40 | |
19. | 41 | |
20. | 42 | |
21. | 42 | |
22. | 43 | |
23. | 44 | |
24. | 48 | |
25. | 48 | |
26. | 49 | |
27. | 51 | |
28. | 54 | |
29. | 55 | |
30. | 57 | |
31. | 57 | |
32. | 57 | |
33. | 58 | |
| 1 |
Lavoro Agro Holding S.A. As of June 30, 2025 and 2024 (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
|
|
|
|
|
| Parent Company |
|
|
| Consolidated |
|
| Note |
| 2025 |
| 2024 |
| 2025 |
| 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current |
|
|
|
|
|
|
|
|
|
|
Cash equivalents |
| 4 |
| 321 |
| 72,216 |
| 329,683 |
| 856,626 |
Trade receivables |
| 5 |
| - |
| - |
| 1,219,187 |
| 2,146,189 |
Inventories |
| 8 |
| - |
| - |
| 644,485 |
| 1,437,340 |
Taxes recoverable |
| 9 |
| 1,220 |
| 441 |
| 17,103 |
| 47,144 |
Related parties |
| 26 |
| - |
| 13,318 |
| 211,804 |
| 149,981 |
Derivative financial instruments |
| 7 |
| - |
| - |
| 4,509 |
| 37,667 |
Commodity forward contracts |
| 10 |
| - |
| - |
| 33,592 |
| 137,660 |
Advances to suppliers |
| 11 |
| - |
| - |
| 347,391 |
| 228,576 |
Other assets |
|
|
| 623 |
| 6,139 |
| 46,261 |
| 23,146 |
|
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
|
| 2,164 |
| 92,114 |
| 2,854,015 |
| 5,064,329 |
|
|
|
|
|
|
|
|
|
|
|
Non-current |
|
|
|
|
|
|
|
|
|
|
Trade Receivables |
| 5 |
| - |
| - |
| 54,152 |
| 54,153 |
Related parties |
| 26 |
| 575,407 |
| 402,600 |
| - |
| - |
Other assets |
|
|
| 226 |
| 226 |
| 4,039 |
| 4,298 |
Commodity forward contracts |
| 10 |
| - |
| - |
| - |
| 3,000 |
Right-of-use assets |
| 12 |
| 4,229 |
| 4,221 |
| 92,725 |
| 160,292 |
Judicial deposits |
|
|
| - |
| - |
| 12,198 |
| 10,520 |
Taxes recoverable |
| 9 |
| - |
| - |
| 310,013 |
| 299,228 |
Deferred income tax assets |
| 23 |
| - |
| - |
| - |
| 285,139 |
Investments |
| 13 |
| 2,769 |
| 926,851 |
| 2,347 |
| 2,088 |
Property, plant and equipment |
| 14 |
| 6,393 |
| 17,417 |
| 52,447 |
| 78,830 |
Intangible assets |
| 15 |
| 42,506 |
| 37,274 |
| 46,488 |
| 894,274 |
|
|
|
|
|
|
|
|
|
|
|
Total non-current assets |
|
|
| 631,530 |
| 1,388,589 |
| 574,409 |
| 1,791,822 |
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
|
| 633,694 |
| 1,480,703 |
| 3,428,424 |
| 6,856,151 |
The accompanying notes are an integral part of these separate and consolidated financial statements.
| 2 |
Lavoro Agro Holding S.A. As of June 30, 2025 and 2024 (In thousands of reais (R$), except where otherwise indicated) |
| ||||||||||
| |||||||||||
|
| ||||||||||
|
|
|
|
|
| Parent Company |
|
|
| Consolidated | |
|
| Note |
| 2025 |
| 2024 |
| 2025 |
| 2024 | |
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
| |
Current |
|
|
|
|
|
|
|
|
|
| |
Trade payables |
| 17 |
| - |
| - |
| 2,945,077 |
| 3,407,431 | |
Lease liabilities |
| 12 |
| 1,843 |
| 1,953 |
| 47,147 |
| 64,815 | |
Borrowings |
| 18 |
| - |
| - |
| 447,445 |
| 647,029 | |
Agribusiness Receivables Certificates |
| 19 |
| 410,515 |
| 918 |
| 410,515 |
| 918 | |
Obligations to quota holders |
| 20 |
| - |
| - |
| 458,330 |
| 175,520 | |
Payables for acquisition of subsidiaries |
| 21 |
| - |
| 6,827 |
| 46,203 |
| 172,653 | |
Related parties |
| 26 |
| 442,914 |
| 319,083 |
| 313,687 |
| 459,909 | |
Derivative financial instruments |
| 7 |
| 22,194 |
| - |
| 31,411 |
| 75,175 | |
Commodity forward contracts |
| 10 |
| - |
| - |
| 33,164 |
| 65,641 | |
Salaries and social charges |
|
|
| 22,952 |
| 10,373 |
| 143,071 |
| 141,786 | |
Taxes payable |
| 6 |
| 3,719 |
| 336 |
| 69,481 |
| 23,966 | |
Dividends payable |
|
|
| - |
| - |
| 18,722 |
| 411 | |
Advance from customers |
| 25 |
| - |
| - |
| 87,910 |
| 233,373 | |
Other liabilities |
| 17 |
| 13,976 |
| 1,790 |
| 199,363 |
| 41,335 | |
|
|
|
|
|
|
|
|
|
|
| |
Total current liabilities |
|
|
| 918,113 |
| 341,280 |
| 5,251,526 |
| 5,509,962 | |
|
|
|
|
|
|
|
|
|
|
| |
Non-current |
|
|
|
|
|
|
|
|
|
| |
Trade payables |
| 17 |
| - |
| - |
| 88 |
| 592 | |
Lease liabilities |
| 12 |
| 2,821 |
| 2,551 |
| 55,902 |
| 108,462 | |
Borrowings |
| 18 |
| - |
| - |
| - |
| 165 | |
Agribusiness Receivables Certificates |
| 20 |
| - |
| 415,934 |
| - |
| 404,647 | |
Commodity forward contracts |
| 10 |
| - |
| - |
| - |
| 316 | |
Payables for acquisition of subsidiaries |
| 21 |
| 6,827 |
| - |
| 103,116 |
| 9,307 | |
Provision for contingencies |
| 24 |
| - |
| - |
| 11,004 |
| 4,111 | |
Other liabilities |
|
|
| - |
| - |
| 597 |
| 590 | |
Taxes payable |
| 6 |
| - |
| - |
| 3,640 |
| 777 | |
Deferred income tax liabilities |
| 23 |
| - |
| - |
| - |
| 1,606 | |
Allowance for investment losses |
| 13 |
| 1,604,194 |
| - |
| - |
| - | |
|
|
|
|
|
|
|
|
|
|
| |
Total non-current liabilities |
|
|
| 1,613,842 |
| 418,485 |
| 174,347 |
| 530,573 | |
|
|
|
|
|
|
|
|
|
|
| |
Equity (deficit) |
|
|
|
|
|
|
|
|
|
| |
Share capital |
| 27 |
| 1,457,186 |
| 1,350,566 |
| 1,457,186 |
| 1,350,566 | |
Advance for future capital increase |
|
|
| 91,752 |
| 198,372 |
| 91,752 |
| 198,372 | |
Capital reserve |
| 27 |
| 34,422 |
| 11,983 |
| 34,422 |
| 11,983 | |
Equity valuation adjustments |
| 27 |
| (160,157) |
| (167,806) |
| (160,157) |
| (167,806) | |
Accumulated losses |
| 27 |
| (3,321,464) |
| (672,177) |
| (3,321,464) |
| (672,177) | |
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
| (1,898,261) |
| 720,938 |
| (1,898,261) |
| 720,938 | |
Non-controlling interest |
|
|
| - |
| - |
| (99,188) |
| 94,678 | |
Total Equity (deficit) |
|
|
| (1,898,261) |
| 720,938 |
| (1,997,449) |
| 815,616 | |
|
|
|
|
|
|
|
|
|
|
| |
Total liabilities and equity (deficit) |
|
|
| 633,694 |
| 1,480,703 |
| 3,428,424 |
| 6,856,151 | |
The accompanying notes are an integral part of these separate and consolidated financial statements.
| 3 |
Lavoro Agro Holding S.A. As of June 30, 2025 and 2024 (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
|
|
|
| Parent Company |
| Consolidated | ||||
|
| Note |
| 2025 |
| 2024 |
| 2025 |
| 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue from contracts with customers |
| 28 |
| - |
| - |
| 4,861,065 |
| 7,936,720 |
Cost of goods sold |
| 29 |
| - |
| - |
| (4,403,165) |
| (7,022,957) |
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
|
| - |
| - |
| 457,900 |
| 913,763 |
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses |
| 29 |
| (239,554) |
| (26,236) |
| (2,199,881) |
| (926,121) |
Other operating income (expenses), net |
| 30 |
| 120 |
| 11,451 |
| 16,317 |
| 48,465 |
Share of profit of an associate |
| 13 |
| (2,356,762) |
| (612,927) |
| 668 |
| (485) |
|
|
|
|
|
|
|
|
|
|
|
(Loss)/Profit before finance income and costs |
|
|
| (2,596,196) |
| (627,712) |
| (1,724,996) |
| 35,622 |
|
|
|
|
|
|
|
|
|
|
|
Finance income |
| 31 |
| 66,053 |
| 40,126 |
| 337,463 |
| 393,958 |
Finance costs |
| 31 |
| (107,471) |
| (62,998) |
| (1,037,321) |
| (1,038,957) |
Other finance costs |
| 31 |
| (11,517) |
| (1,895) |
| (131,118) |
| (114,972) |
|
|
|
|
|
|
|
|
|
|
|
Loss before income tax |
|
|
| (2,649,131) |
| (652,479) |
| (2,555,972) |
| (724,349) |
|
|
|
|
|
|
|
|
|
|
|
Income taxes, current and deferred |
| 23 |
| (156) |
| - |
| (303,804) |
| 39,060 |
|
|
|
|
|
|
|
|
|
|
|
Net loss for the year |
|
|
| (2,649,287) |
| (652,479) |
| (2,859,776) |
| (685,289) |
|
|
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
|
|
Equity holders of the parent |
|
|
| (2,649,287) |
| (652,479) |
| (2,649,287) |
| (652,479) |
Non-controlling interests |
|
|
| - |
| - |
| (210,489) |
| (32,810) |
The accompanying notes are an integral part of these separate and consolidated financial statements.
| 4 |
Lavoro Agro Holding S.A. For the years ended June 30, 2025 and 2024 (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
|
|
| Parent Company |
| Consolidated | ||||
| Note |
| 2025 |
| 2024 |
| 2025 |
| 2024 |
|
|
|
|
|
|
|
|
|
|
Net loss for the year |
|
| (2,649,287) |
| (652,479) |
| (2,859,776) |
| (685,289) |
Exchange differences on translation of foreign operations | 13 |
| - |
| 752 |
| 107 |
| 752 |
|
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the year |
|
| (2,649,287) |
| (651,727) |
| (2,859,669) |
| (684,537) |
|
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
|
Equity holders of the parent |
|
| (2,649,287) |
| (651,727) |
| (2,649,180) |
| (651,727) |
Non-controlling interests |
|
|
|
|
|
| (210,489) |
| (32,810) |
The accompanying notes are an integral part of these separate and consolidated financial statements.
| 5 |
Lavoro Agro Holding S.A. For the years ended June 30, 2025 and 2024 (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
| Note |
| Share capital |
| Advance for future capital increase |
| Capital reserve |
| Equity |
| Accumulated losses |
| Total |
| Non-controlling interest |
| Total Equity | |
As of June 30, 2023 |
|
|
| 1,350,566 |
| - |
| 12,505 |
| (148,313) |
| (19,698) |
| 1,195,060 |
| 119,590 |
| 1,314,650 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advance for future capital increase |
| 27 |
| - |
| 198,372 |
| - |
| - |
| - |
| 198,372 |
| 5,933 |
| 204,305 |
Acquisition of non-controlling interests |
| 13.c |
| - |
| - |
| - |
| (11) |
| - |
| (11) |
| (41) |
| (52) |
Acquisition of subsidiaries |
| 13.c |
| - |
| - |
| - |
| (20,307) |
| - |
| (20,307) |
| 2,006 |
| (18,301) |
Cumulative translation adjustments |
| 13 |
| - |
| - |
| - |
| 825 |
| - |
| 825 |
| - |
| 825 |
Share-based payment |
| 27 |
| - |
| - |
| (522) |
| - |
| - |
| (522) |
| - |
| (522) |
Loss for the year |
|
|
| - |
| - |
| - |
| - |
| (652,479) |
| (652,479) |
| (32,810) |
| (685,289) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of June 30, 2024 |
|
|
| 1,350,566 |
| 198,372 |
| 11,983 |
| (167,806) |
| (672,177) |
| 720,938 |
| 94,678 |
| 815,616 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital increase |
| 27 |
| 106,620 |
| (106,620) |
| - |
| - |
| - |
| - |
| - |
| - |
Acquisition of non-controlling interests |
| 13.c |
| - |
| - |
| - |
| (10,590) |
| - |
| (10,590) |
| 10,590 |
| - |
Cumulative translation adjustments |
| 13 |
| - |
| - |
| - |
| 107 |
| - |
| 107 |
| - |
| 107 |
Share-based payment |
| 27 |
| - |
|
|
| 22,439 |
| - |
| - |
| 22,439 |
| - |
| 22,439 |
Other |
|
|
|
|
|
|
|
|
| 18,132 |
|
|
| 18,132 |
| 6,033 |
| 24,165 |
Loss for the year |
|
|
| - |
| - |
| - |
| - |
| (2,649,287) |
| (2,649,287) |
| (210,489) |
| (2,859,776) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of June 30, 2025 |
|
|
| 1,457,186 |
| 91,752 |
| 34,422 |
| (160,157) |
| (3,321,464) |
| (1,898,261) |
| (99,188) |
| (1,997,449) |
The accompanying notes are an integral part of these separate and consolidated financial statements.
| 6 |
Lavoro Agro Holding S.A. For the years ended June 30, 2025 and 2024 (In thousands of reais (R$), except where otherwise indicated) |
| ||||||||||
| |||||||||||
|
| ||||||||||
|
|
|
|
|
| Parent Company |
|
|
| Consolidated | |
|
| Note |
| 2025 |
| 2024 |
| 2025 |
| 2024 | |
|
|
|
|
|
|
|
|
|
|
| |
Cash flows from operating activities |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
| |
Loss for the year before income taxes |
|
|
| (2,649,131) |
| (652,479) |
| (2,555,972) |
| (724,349) | |
Adjustments to reconcile loss for the year to net cash flow |
|
|
|
|
|
|
|
|
|
| |
Share of profit of an associate |
|
|
| 2,397,435 |
| 612,927 |
| (668) |
| 485 | |
Allowance for expected credit losses |
|
|
| - |
| - |
| 321,022 |
| 60,779 | |
Reversal of expected credit losses |
|
|
| - |
| - |
| (105,901) |
| - | |
Loss on write-off of trade receivables |
|
|
| - |
| - |
| 249,144 |
| - | |
Foreign exchange differences |
|
|
| 307 |
| (16) |
| 62 |
| 33,330 | |
Accrued interest expenses on borrowings and financing |
| 31 |
| 57,983 |
| 28,995 |
| 287,265 |
| 265,526 | |
Interest arising from revenue contracts |
|
|
|
|
| - |
| (277,084) |
| (359,530) | |
Interest on trade payables |
| 31 |
| - |
| - |
| 661,141 |
| 667,072 | |
Loss (gain) on derivatives |
|
|
| 22,194 |
| - |
| 11,915 |
| (27,106) | |
Interest from tax benefits |
|
|
| - |
| - |
| (2,295) |
| (18,902) | |
Fair value on commodity forward contracts |
|
|
| - |
| - |
| (32,477) |
| 108,748 | |
Amortization of intangibles |
| 29 |
| 18,005 |
| 12,950 |
| 52,940 |
| 66,260 | |
Amortization of right-of-use assets |
| 29 |
| 2,282 |
| 2,290 |
| 62,604 |
| 70,059 | |
Depreciation |
| 29 |
| 2,448 |
| 1,309 |
| 14,239 |
| 12,536 | |
Impairment |
| 29 |
| 155,364 |
| - |
| 822,257 |
| - | |
Allowance for inventories losses and damages |
|
|
| - |
| - |
| 78,943 |
| 44,932 | |
Provision for contingencies |
|
|
| - |
| - |
| 6,893 |
| 3,410 | |
Share-based payment |
|
|
| 21,794 |
| - |
| 22,438 |
| (333) | |
Others |
|
|
| (13,245) |
| 3,652 |
| 6,926 |
| (12,512) | |
|
|
|
|
|
|
|
|
|
|
| |
Change in operating assets and liabilities |
|
|
|
|
|
|
|
|
|
| |
Trade receivables |
|
|
| - |
| - |
| 141,458 |
| (107,866) | |
Inventories |
|
|
| - |
| - |
| 713,912 |
| 155,799 | |
Advances to suppliers |
|
|
| - |
| - |
| (118,815) |
| (46,481) | |
Derivative financial instruments |
|
|
| - |
| - |
| 107,068 |
| 62,874 | |
Taxes recoverable |
|
|
| (779) |
| (62) |
| 21,551 |
| 181,764 | |
Related parties |
|
|
| (159,489) |
| (350,487) |
| (61,823) |
| 99,710 | |
Other assets |
|
|
| 5,515 |
| (5,797) |
| (22,916) |
|
| |
|
|
|
| - |
|
|
|
|
|
| |
Trade payables |
|
|
| - |
| - |
| (580,245) |
| 1,263,111 | |
Advances from customers |
|
|
| - |
| - |
| (381,393) |
| (249,715) | |
Salaries and social charges |
|
|
| 12,579 |
| (25,681) |
| 1,285 |
| (38,609) | |
Related parties |
|
|
| 123,831 |
| 17,529 |
| (146,222) |
| - | |
Taxes payable |
|
|
| 3,383 |
| (17) |
| 80,938 |
| 16,485 | |
Other payables |
|
|
| 5,359 |
| (20,688) |
| 158,037 |
| (12,134) | |
|
|
|
| - |
|
|
|
|
|
| |
Interest paid on borrowings and FIAGRO quota holders |
|
|
| (56,355) |
| (27,617) |
| (157,472) |
| (228,827) | |
Interest paid on acquisitions of subsidiary |
|
|
| - |
| - |
| (2,481) |
| (8,988) | |
Interest paid on trade payables and lease liabilities |
|
|
| (527) |
| (460) |
| (12,006) |
| (745,450) | |
Interest received from revenue contracts |
|
|
| - |
| - |
| 54,610 |
| 393,239 | |
Income taxes paid/received |
|
|
| - |
| - |
| (32,560) |
| (157,842) | |
|
|
|
| - |
|
|
|
|
|
| |
Net cash flows used in operating activities |
|
|
| (51,047) |
| (403,652) |
| (613,682) |
| 767,475 | |
Acquisition of subsidiary, net of cash acquired |
|
|
| - |
| - |
| (28,789) |
| (201,641) | |
Capital injection in subsidiaries |
| 13 |
| - |
| (157,570) |
|
|
| - | |
Additions to property, plant and equipment and intangible assets |
|
|
| (18,717) |
| (23,948) |
| (27,801) |
| (44,260) | |
| 7 |
Lavoro Agro Holding S.A. For the years ended June 30, 2025 and 2024 (In thousands of reais - R$, unless otherwise indicated) |
| ||||||||||
| |||||||||||
|
| ||||||||||
Proceeds from the sale of property, plant and equipment |
|
|
| - |
| - |
|
|
| 272 | |
|
|
|
|
|
|
|
|
|
|
| |
Net cash flows in investing activities |
|
|
| (18,717) |
| (181,518) |
| (56,590) |
| (245,629) | |
|
|
|
|
|
|
|
|
|
|
| |
Cash flows from financing activities |
|
|
|
|
|
|
|
|
|
| |
Proceeds from borrowing |
|
|
| - |
| - |
| 275,898 |
| 1,826,594 | |
Repayment of Borrowings |
|
|
| - |
| - |
| (457,986) |
| (2,053,445) | |
Proceeds from Agribusiness Receivables Certificates |
| 19 |
| - |
| 413,546 |
| - |
| 404,647 | |
Payment of principal portion of lease liabilities |
|
|
| (2,131) |
| (1,896) |
| (65,734) |
| (66,135) | |
Proceeds from FIAGRO quota holders, net of transaction costs |
|
|
| - |
| - |
| 156,328 |
| 137,496 | |
Repayment of FIAGRO quota holders |
|
|
| - |
| - |
| - |
| (110,530) | |
Trade payables – supplier finance |
|
|
| - |
| - |
| - |
| (16,569) | |
Acquisition of non-controlling interests |
|
|
| - |
| - |
| - |
| (52) | |
Dividend payments |
|
|
| - |
| - |
| - |
| (1,208) | |
Related party transactions |
|
|
| - |
|
|
| 235,930 |
| - | |
Capital increase |
| 27 |
| - |
| 241,301 |
| - |
| - | |
|
|
|
|
|
|
|
|
|
|
| |
Net cash flows provided by financing activities |
|
|
| (2,131) |
| 652,951 |
| 144,436 |
| 120,798 | |
|
|
|
|
|
|
|
|
|
|
| |
Net increase in cash equivalents |
|
|
| (71,895) |
| 67,781 |
| (525,836) |
| 642,644 | |
|
|
|
|
|
|
|
|
|
|
| |
Net foreign exchange difference |
|
|
| - |
| - |
| (1,168) |
| 6,238 | |
|
|
|
|
|
|
|
|
|
|
| |
Cash equivalents at beginning of the year |
|
|
| (72,216) |
| 4,435 |
| 856,626 |
| 207,744 | |
|
|
|
|
|
|
|
|
|
|
| |
Cash equivalents at end of the year |
|
|
| 321 |
| 72,216 |
| 329,623 |
| 856,626 | |
The accompanying notes are an integral part of these separate and consolidated financial statements.
| 8 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
1. Background information
(a) Operational Context
Lavoro Agro Holding S.A., referred to in these financial statements as the "Parent" or "Lavoro Holding" (together with its subsidiaries, the "Company"), was incorporated as a corporation in 2017 and is domiciled in the city of São Paulo, Brazil. It is one of the main platforms for the distribution of agricultural inputs and has expanded mainly through mergers and acquisitions of entities engaged in the distribution of agricultural inputs such as crop protection products, fertilizers, seeds and specialty inputs (foliar fertilizers, biologicals, adjuvants and organominerals).
The Company offers farmers a complete portfolio of products and services, providing multichannel support. The Company's customers are farmers engaged in the production of grains, mainly soybeans and corn, as well as cotton, citrus and fruit and vegetable crops, among others.
Agribusiness is subject to significant seasonality throughout the year, mainly due to crop cycles that depend on specific weather conditions. Brazil’s climate allows two to three harvests per year in the same area, unlike many other agricultural regions. Accordingly, because customer activity follows crop cycles, the Company’s revenue and cash flows are highly seasonal.
Sales of products depend on planting and growing seasons, which vary from year to year, and are expected to result in highly seasonal patterns and substantial fluctuations in quarterly sales and profitability. Demand for our products is generally stronger between October and December, with a second period of stronger demand between January and March. The seasonality of agricultural inputs causes sales volumes and net sales to be typically higher in the period between September and February, while our working capital needs and total debt are typically higher immediately after the end of that period.
As of the date of preparation of these financial statements, the Company is an indirect wholly owned subsidiary of Lavoro Limited, a company headquartered in the Cayman Islands, registered with the Securities and Exchange Commission (SEC) and whose shares are traded on Nasdaq under the symbol "LVRO".
(b) Economic and financial situation of the Company and out-of-court reorganization filing
During the year ended June 30, 2025, the Company was affected by the financial crisis in Brazil’s agricultural inputs, which materially impacted its results and financial position. As of June 30, 2025, the Company reported a separate (parent) equity deficit of R$ 1,898,261 (equity surplus of R$ 720,938 as of June 30, 2024) and a consolidated equity deficit of R$ 1,997,449 (equity surplus of R$ 815,616 as of June 30, 2024), mainly due to accumulated losses of R$ 3,321,464 (R$ 672,177 as of June 30, 2024). Net working capital showed a deficit of R$915,949 in the separate (parent) company (R$249,166 as of June 30, 2024), and a net working capital deficit of R$2,397,511 on a consolidated basis (R$445,633 as of June 30, 2024).
The principal factors contributing to this financial crisis include:
a decline in commodity prices, which compressed farmers’ margins, delayed input purchases, and drove a shift to lower value-added products;
adverse weather conditions beginning in late 2023 and worsening in 2024, severely reducing water availability, and adversely impacting crop yields;
high inventory levels carried at high acquisition costs (from 2022 price increases), which negatively affected sales, profitability, and cash generation in subsequent years;
a decline in market prices of agricultural inputs, reduced inventory values and compressed margins at sale;
tighter credit, higher interest rates, and elevated farmer financial leverage levels led to an increase in farmer default rates and bankruptcy filings, in turn pressuring liquidity in Brazil’s agricultural inputs value chain, from inputs suppliers to distribution companies;
increased supplier collateral requirements for inventory financing, further stressing the supply chain; and
an increase in the Company’s leverage and funding cost given these market conditions, and higher prevalent policy interest rates in Brazil.
| 9 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
Due to the deterioration in the market conditions described above, the Company engaged an independent consulting firm to act as financial advisor and evaluate alternatives to address the Company’s capital structure in light of the economic environment. In addition, the Company undertook a strategic and operational restructuring. It reviewed the store portfolio, retained locations aligned with its long-term strategy, closed overlapping sites in the same municipality, and implemented measures to reduce general and administrative expenses.
In response, the Company adopted an out-of-court reorganization plan (the “EJ Plan”) as its alternative to maintain the continuity of operations. The EJ Plan was filed on June 18, 2025 and is pending before the 2nd Court of Bankruptcies and Judicial Reorganizations of the Central District of the City of São Paulo.
The plan was submitted pursuant to a previously negotiated agreement with the Company’s principal agricultural inputs suppliers. Its objectives are to extend payment terms, secure inventory supply, reestablish supplier financing lines, and enable the Company to meet customers’ demand.
Financial liabilities arising from financing transactions, such as loans, borrowings, FIDCs/FIAGRO, and other obligations not related to the purchase of agricultural inputs, are outside the scope of the PRE and will continue to be honored on their original terms and/or renegotiated bilaterally. The purpose of the EJ Plan is to adjust the debt profile and preserve the Company’s operational continuity. The effects of the plan are being evaluated by Management and will be recognized in the accounting records only upon court approval.
On the filing date, approximately R$2.5 billion of the Company’s trade payables to suppliers were subject to restructuring under the PRE. Creditors were grouped into categories with specific payment terms, based on product category, size, and intention to continue the supply relationship. Creditors that adhere to the plan will receive semiannual payments, adjusted by the IPCA inflation index and without any discount, through 2030. Creditors that do not adhere to the plan will be paid in 2032 in a single installment with a 50% discount.
In this context, the Company continually evaluates the going-concern assumption. The principal planned actions to sustain its ability to continue as a going concern include:
disciplined execution of sales, collections, purchasing, and payment plans;
reduction of selling, general, and administrative expenses (SG&A);
regularization of debt service, including the renegotiation and renewal of relevant credit lines;
asset sales.
These measures form a financial and operational stabilization plan aimed at sustainable recovery and protecting the interests of shareholders, creditors, and employees
Given this above, management concluded, based on the annual impairment test of intangible assets and the recoverability assessment of deferred tax assets, that it was necessary to recognize impairment losses of R$822,257 and a write-down of R$283,533, respectively, as detailed in Notes 16 and 23.
2. Basis of preparation of the financial statements
(a) Basis of preparation and presentation
The separate and consolidated financial statements have been prepared and are being presented in accordance with the accounting practices adopted in Brazil and with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) (currently referred to by the IFRS Foundation as "IFRS Accounting Standards").
The Company followed Technical Guidance OCPC 07 (issued by the CPC, November 2014), in preparing these financial statements. Accordingly, the disclosures provided represent the information used by Management in running the business.
The separate and consolidated financial statements were prepared on a historical cost basis, except for financial assets and liabilities (including commodity forward contracts and derivative financial instruments) that are measured at fair value through profit or loss.
The separate and consolidated financial statements are presented in Brazilian reais ("BRL" or "R$"), which is the Company's functional currency. All amounts are rounded to the nearest thousand (R$ 000), unless stated otherwise.
Despite the significant uncertainties described in Note 1, the separate and consolidated financial statements were prepared on a going concern basis.
On October 31, 2025, the Company’s Board of Directors approved the issuance of the separate and consolidated financial statements.
| 10 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(b) Significant accounting judgments, estimates, and assumptions
Use of critical accounting estimates and judgments
The preparation of the separate and consolidated financial statements requires Management to make judgments, estimates and to use assumptions that affect the application of the Company’s accounting policies and the reported amounts of assets, liabilities, revenue and expenses. These estimates are based on Management’s experience and knowledge, on the information available at the reporting date and on other factors, including expectations of future events that are considered reasonable under the circumstances. Any changes in facts and circumstances may lead to a revision of these estimates. Actual results may differ from these estimates.
Estimates and assumptions are reviewed on an ongoing basis and revisions are recognized prospectively. The significant estimates and judgments applied by the Company in preparing these separate and consolidated financial statements are presented in the following notes:
Note | Significant estimates and judgments |
09 | Accounts receivable – Allowance for expected credit losses |
10 | Commodity forward contracts |
16 | Impairment test of non-financial assets |
(c) Basis of consolidation
The Company consolidates all entities over which it has control, that is, when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to direct the investee’s relevant activities. Lavoro Holding’s fiscal year-end is June 30. The consolidated financial statements are prepared for the same reporting periods, using consistent accounting policies.
All intercompany balances, transactions, and unrealized gains and losses are eliminated in full.
The subsidiaries included in the consolidated financial statements are all based in Brazil and are described below.
Name |
| Main activity | Location | 2025 | 2024 |
Lavoro Agrocomercial S.A. (i) |
| Distributor of agricultural inputs | Rondonópolis – MT | 99.88% | 97.43% |
Agrocontato Comércio e Representações de Produtos Agropecuários S.A. |
| Distributor of agricultural inputs | Sinop – MT | 99.88% | 97.43% |
PCO Comércio, Importação e Exportação e Agropecuária Ltda. |
| Distributor of agricultural inputs | Campo Verde – MT | 99.88% | 97.43% |
Agrovenci Distribuidora de Insumos Agrícolas Ltda. (MS) |
| Distributor of agricultural inputs | Chapadão do Sul – GO | 93.60% | 93.60% |
Produtiva Agronegócios Comércio e Representação Ltda. (i) |
| Distributor of agricultural inputs | Paracatu – GO | 92.61% | 87.40% |
Facirolli Comércio e Representação S.A. (Agrozap) (i) |
| Distributor of agricultural inputs | Uberaba – MG | 77.89% | 62.61% |
Agrovenci Comércio, Importação e Exportação e Agropecuária Ltda. |
| Distributor of agricultural inputs | Campo Verde – MT | 99.88% | 97.43% |
Central Agrícola Rural Distribuidora de Defensivos Ltda. |
| Distributor of agricultural inputs | Vilhena – RO | 99.88% | 97.43% |
Distribuidora Pitangueiras de Produtos Agropecuários S.A. |
| Distributor of agricultural inputs | Ponta Grossa – PR | 93.60% | 93.60% |
Produtec Comércio e Representações S.A. (i) |
| Distributor of agricultural inputs | Cristalina – GO | 92.61% | 87.40% |
Qualiciclo Agrícola S.A. |
| Distributor of agricultural inputs | Limeira – SP | 72.17% | 72.17% |
Desempar Participações Ltda. |
| Distributor of agricultural inputs | Palmeira – PR | 93.60% | 93.60% |
Denorpi Distribuidora de Insumos Agrícolas Ltda. |
| Distributor of agricultural inputs | Palmeira – PR | 93.60% | 93.60% |
Deragro Distribuidora de Insumos Agrícolas Ltda. |
| Distributor of agricultural inputs | Palmeira – PR | 93.60% | 93.60% |
Desempar Tecnologia Ltda. (iv) |
| Holding company | Palmeira – PR | — % | 93.60% |
| 11 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
| |||||
| ||||||
|
| |||||
Futuragro Distribuidora de Insumos Agrícolas Ltda. |
| Distributor of agricultural inputs | Palmeira – PR | 93.60% | 93.60% | |
Plenafértil Distribuidora de Insumos Agrícolas Ltda. |
| Distributor of agricultural inputs | Palmeira – PR | 93.60% | 93.60% | |
Realce Distribuidora de Insumos Agrícolas Ltda. |
| Distributor of agricultural inputs | Palmeira – PR | 93.60% | 93.60% | |
Cultivar Agrícola Comércio, Importação e Exportação S.A. |
| Distributor of agricultural inputs | Chapadão do Sul – GO | 93.60% | 93.60% | |
Nova Geração Comércio e Produtos Agrícolas Ltda. |
| Distributor of agricultural inputs | Pinhalzinho – SP | 72.17% | 72.17% | |
Floema Soluções Nutricionals de Cultivos Ltda. (i) |
| Distributor of agricultural inputs | Uberaba – MG | 77.89% | 62.61% | |
Casa Trevo Participações S.A. |
| Holding company | Nova Prata – RS | 79.56% | 79.56% | |
Casa Trevo Comercial Agrícola LTDA. |
| Distributor of agricultural inputs | Nova Prata – RS | 79.56% | 79.56% | |
CATR Comercial Agrícola LTDA. |
| Distributor of agricultural inputs | Nova Prata – RS | 79.56% | 79.56% | |
Sollo Sul Insumos Agrícolas Ltda. |
| Distributor of agricultural inputs | Pato Branco – PR | 93.60% | 93.60% | |
Dissul Agricultural Inputs Ltda. |
| Distributor of agricultural inputs | Pato Branco – PR | 93.60% | 93.60% | |
Reference Agroinsumos Ltda. (i) (ii) | Distributor of agricultural inputs | Dom Pedrito - RS | 65.95% | 65.52% | ||
Lavoro Agro Investment Fund in Agroindustrial Production Chains – FIAGRO I (iii) | Credit rights fund | São Paulo – SP | 5% | 5% | ||
Lavoro Agro Investment Fund in Agroindustrial Production Chains – FIAGRO II (iii) | Credit rights fund | São Paulo – SP | 19.63% | — % | ||
Perterra Trading S.A. | Distributor of agricultural inputs | Montevideo - Uruguay | 93.60% | 93.60% | ||
CORAM - Comércio e Representações Agrícolas Ltda. (ii) | Distributor of agricultural inputs | São Paulo – Brazil | 72.17% |
72.17%
| ||
(i) Changes in non-controlling shareholders are described in Note 13 – investments.
(ii) Subsidiaries acquired in the year ended June 30, 2024, details are described in 22 – Business Combination.
(iii) FIAGRO I and FIAGRO II were incorporated in July 2022 and August 2024, respectively (Note 20).
(iv) Subsidiary closed by voluntary liquidation on August 22, 2024.
In addition, the financial statements include the following unconsolidated company:
Name |
| Principal activity | Location | 2025 | 2024 |
Gestão e Transformação Consultoria S.A. |
| Consultancy | São Paulo – SP | 20% | 20% |
3. Summary of Significant Accounting Policies
The main significant accounting policies applied in the preparation of the separate and consolidated financial statements have been included in the respective notes and are consistent in all periods presented.
(a) New accounting standards, interpretations and amendments adopted from July 1, 2024:
The following new accounting standards, interpretations, and amendments were adopted from July 1, 2024:
Amendment to IFRS 16 (R2) – Lease Liability in a Sale and Leaseback;
Amendments to IAS 1 – Classification of liabilities as "Current" or "Non-Current";
Amendments to IAS 7 and IFRS 7 – Supplier Finance Arrangements disclosures (reverse factoring);
Amendment to IAS 21 – The Effects of Changes in Foreign Exchange Rates;
OCPC 10 – Carbon credits (TCO2E), emission allowances and decarbonization credits (CBIO).
In addition, the other new standards and interpretations did not have a material effect on the consolidated financial statements.
| 12 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(b) New accounting standards, interpretations and amendments issued but not yet adopted:
The Company has not early adopted any of these standards and does not expect them to have a significant impact on the financial statements in subsequent periods.
The new standards and interpretations issued but not yet adopted as of the date of issuance of the Company’s consolidated financial statements are as follows:
Amendments to IFRS 9 and IFRS 7 – Classification and Measurement of Financial Instruments;
IFRS 18 – Presentation and Disclosure in Financial Statements;
IFRS 19 – Subsidiaries without Public Accountability: Disclosures;
IFRS S1 – General Requirements for Disclosure of Sustainability-related Financial Information;
IFRS S2 – Climate-related Disclosures.
The Company intends to adopt these new standards, amendments and interpretations, as applicable, when they become effective, and the Company does not expect them to have a significant impact on the financial statements.
(c) Functional and presentation currency
Items in these financial statements are measured using the Parent’s functional currency, which is the primary economic environment in which it operates.The separate and consolidated financial statements are presented in R$, which is the Parent’s functional currency and also its presentation currency.
For consolidation purposes, foreign operations are translated into Brazilian reais as follows:
(i) Assets and liabilities are translated into reais at the closing exchange rate at the reporting date;
(ii) Items of profit or loss are translated at the average monthly exchange rate; and
(iii) Exchange differences arising from translation are recognized in equity as Cumulative translation adjustments.
The balance of the Cumulative translation adjustments account is reclassified to profit or loss in the period in which the net assets are sold or written off. Any goodwill arising from the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising from the acquisition are treated as assets and liabilities of the foreign operation and are translated at the exchange rate prevailing at the reporting date.
Transactions and balances
Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the exchange rates prevailing at the balance sheet date. Exchange differences arising on settlement or translation of monetary items are recognized in profit or loss.
When applicable, non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions. Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined. Any resulting gain or loss arising from the translation of non-monetary items measured at fair value is treated consistently with the recognition of the gain or loss on the change in fair value of the item (that is, exchange differences on items whose fair value gain or loss is recognized in other comprehensive income or in profit or loss are also recognized in other comprehensive income or in profit or loss, respectively).
(d) Current versus non-current classification
The Company presents assets and liabilities in the statement of financial position based on current/non-current classification. An asset is classified as current when:
it is expected to be realized or intended to be sold or consumed in the normal operating cycle;
it is held primarily for trading;
it is expected to be realized within twelve months after the reporting period; or
it is cash or a cash equivalent, unless it is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
All other assets are classified as non-current.
| 13 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
A liability is classified as current when:
it is expected to be settled in the normal operating cycle;
it is held primarily for trading;
it is due to be settled within twelve months after the reporting period; or
there is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.
The terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.
The Company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and non-current liabilities.
4. Cash and cash equivalents
Accounting policy
Cash and cash equivalents comprise short-term, highly liquid investments with original maturities of three months or less, which are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
The balance of cash and cash equivalents includes financial investments bearing interest between 70% and 88% of the CDI (88% of the CDI in 2024).
5. Trade receivables
Accounting policy
Trade receivables correspond to amounts receivable from customers for the sale of goods or services in the normal course of the Company’s operations.
In accordance with the accounting policies for financial assets described in Note 6, a receivable is recognized when consideration is unconditional—i.e., only the passage of time is required before payment.
(a) Trade receivables balance:
|
|
| Consolidated | ||
|
|
| 2025 |
| 2024 |
|
|
|
|
|
|
Trade receivables in local currency |
|
| 1,687,471 |
| 2,399,353 |
(-) Allowance for expected credit losses |
|
| (414,132) |
| (199,011) |
Total |
|
| 1,273,339 |
| 2,200,342 |
|
|
|
|
|
|
Current |
|
| 1,219,187 |
| 2,146,189 |
Non-current |
|
| 54,152 |
| 54,153 |
|
|
|
|
|
|
The average effective interest rate used to discount trade receivables to their present value was 1.12% per month as of June 30, 2025 (0.90% as of June 30, 2024).
The Company does not have any customer representing more than 10% of trade receivables or operating revenues.
During the fiscal year ended June 30, 2025, the Company transferred receivables to FIAGRO in the amount of R$ 203,538 (R$ 127,421 in June 2024). Since the Company substantially retains the risks and rewards of these assigned receivables, the amounts were not derecognized from the financial statements and remain recorded under Trade receivables. Consequently, a liability arising from these transactions was recorded under Liabilities for FIAGRO quotas (Note 20).
| 14 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(b) Allowance for expected credit losses:
|
| Consolidated | ||
|
| 2025 |
| 2024 |
|
|
|
|
|
Opening balance |
| (199,011) |
| (149,129) |
Additions |
| (321,022) |
| (60,775) |
Reversals (ii) |
| 105,901 |
| - |
Acquisition of subsidiary (i) |
| - |
| (14,518) |
Trade receivables write-off |
| - |
| 25,411 |
|
| (414,132) |
| (199,011) |
(i) Balances arising from business combinations (Note 22).
(ii) Reversal of expected credit losses due to credit assignments with related parties mentioned in Note 26.
The Company's credit risk policy is described in Note 7(b).
The aging of trade receivables is as follows:
|
| Consolidated | ||
|
| 2025 |
| 2024 |
|
|
|
|
|
Not past due |
| 563,083 |
| 1,083,745 |
|
|
|
|
|
Overdue |
|
|
|
|
1 to 60 days |
| 135,186 |
| 231,438 |
61 to 180 days |
| 418,087 |
| 686,050 |
181 to 360 days |
| 49,927 |
| 102,600 |
361 to 720 days |
| 275,025 |
| 168,783 |
720 days or more |
| 246,163 |
| 126,737 |
Allowance for expected credit losses |
| (414,132) |
| (199,011) |
Total |
| 1,273,339 |
| 2,200,342 |
6. Financial instruments
Accounting policy
Initial recognition and measurement
(i) Financial assets
Financial assets are classified, at initial recognition, as subsequently measured at amortized cost, at fair value through other comprehensive income, or at fair value through profit or loss.
The classification of financial assets at initial recognition depends on the contractual cash flow characteristics of the financial asset and on the Company’s business model for managing those financial assets. Except for trade receivables that do not contain a significant financing component, or for which the Company has applied the practical expedient, the Company initially measures a financial asset at its fair value plus transaction costs, in the case of a financial asset not measured at fair value through profit or loss.
For a financial asset to be classified and measured at amortized cost or at fair value through other comprehensive income, it must give rise to cash flows that are solely payments of principal and interest (“SPPI test”) on the principal amount outstanding. This assessment is performed at the instrument level. Financial assets whose cash flows are not solely payments of principal and interest are classified and measured at fair value through profit or loss, regardless of the business model.
| 15 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
The Company’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, from selling the financial assets, or from both. Financial assets classified and measured at amortized cost are held in a business model whose objective is to hold financial assets in order to collect contractual cash flows, whereas financial assets classified and measured at fair value through other comprehensive income are held in a business model whose objective is both to collect contractual cash flows and to sell financial assets.
Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or market convention (regular way trades) are recognized on the trade date, i.e., the date the Company commits to the transaction.
Subsequent measurement
For purposes of subsequent measurement, the Company classifies its financial assets into the following categories:
Financial assets at amortized cost
Financial assets at fair value through profit or loss
Financial assets at amortized cost
Financial assets at amortized cost are subsequently measured using the effective interest method and are subject to impairment. Gains and losses are recognized in profit or loss when the asset is derecognized, modified or impaired.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are presented in the statement of financial position at fair value, with net changes in fair value recognized in profit or loss. This category includes derivative instruments and commodity forward contracts.
Derecognition
A financial asset (or, when applicable, a part of a financial asset or part of a group of similar financial assets) is derecognized when:
The rights to receive cash flows from the asset have expired; or
the Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a pass-through arrangement, and (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates whether – and to what extent – it has retained the risks and rewards of ownership. When the Company has neither transferred nor retained substantially all the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognize the transferred asset to the extent of its continuing involvement. In that case, the Company also recognizes an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations retained by the Company.
Impairment
The Company recognizes a loss allowance for expected credit losses for trade receivables, which are the only debt instruments not measured at fair value through profit or loss.
(i) Financial liabilities
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss or as financial liabilities at amortized cost, as appropriate.
All financial liabilities are initially measured at their fair value and, for financial liabilities not measured at fair value through profit or loss, plus or minus transaction costs that are directly attributable to the issue of the financial liability.
Subsequent measurement
For purposes of subsequent measurement, financial liabilities are classified into two categories:
Financial liabilities at fair value through profit or loss; and
Financial liabilities at amortized cost.
| 16 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
The measurement of financial liabilities depends on their classification, as described below:
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated at initial recognition at fair value through profit or loss.
Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing them in the near term. This category also includes derivative financial instruments contracted by the Company that are not designated as hedging instruments in hedge relationships defined under CPC 48 / IFRS 9.
Financial liabilities designated at initial recognition at fair value through profit or loss are designated at the initial recognition date and only if the criteria in CPC 48 / IFRS 9 are met.
Financial liabilities at amortized cost
After initial recognition, financial liabilities classified in this category and that bear interest are subsequently measured at amortized cost using the effective interest method, mainly trade payables and borrowings and financings. Gains and losses are recognized in profit or loss when the liabilities are derecognized, as well as through the amortization process of the effective interest rate.
Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the effective interest method. The amortization determined by the effective interest method is recognized as finance costs in the statement of profit or loss.
Derecognition
A financial liability is derecognized when the obligation under the liability is extinguished, i.e., when the obligation specified in the contract is discharged, cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing financial liability are substantially modified, such an exchange or modification is accounted for as a derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in profit or loss.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is presented in the separate and consolidated statement of financial position when there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, or to realize the assets and settle the liabilities simultaneously.
Classification of financial instruments by category
|
| Parent Company |
| Consolidated | ||||
|
| 2025 |
| 2025 | ||||
|
| Amortized cost |
| Fair value through profit or loss |
| Amortized cost |
| Fair value through profit or loss |
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
Trade Receivables |
| - |
| - |
| 1,273,339 |
| - |
Related parties |
| 575,407 |
| - |
| 211,804 |
| - |
Commodity forward contracts |
| - |
| - |
| - |
| 33,592 |
Derivative financial instruments |
| - |
| - |
| - |
| 4,509 |
Total |
| 575,407 |
| - |
| 1,485,143 |
| 38,101 |
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
Trade Payables |
| - |
| - |
| 2,945,165 |
| - |
Lease liabilities |
| 4,664 |
| - |
| 103,049 |
| - |
Borrowings |
| - |
| - |
| 447,445 |
| - |
Agribusiness Receivables Certificates (CRA) |
| 410,515 |
| - |
| 410,515 |
| - |
Obligations to FIAGRO quota holders |
| - |
| - |
| 458,330 |
| - |
Payables for acquisition of subsidiaries |
| 6,827 |
| - |
| 149,319 |
| - |
Related parties |
| 442,914 |
| - |
| 313,687 |
| - |
Derivative financial instruments |
| - |
| 22,194 |
| - |
| 31,411 |
Salaries and social charges |
| 22,952 |
| - |
| 143,071 |
| - |
Commodity forward contracts |
| - |
| - |
| - |
| 33,164 |
Dividends payable |
| - |
| - |
| 18,722 |
| - |
Total |
| 887,872 |
| 22,194 |
| 4,989,303 |
| 64,575 |
| 17 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
|
| Parent Company |
| Consolidated | ||||
|
| 2024 |
| 2024 | ||||
|
| Amortized cost |
| Fair value through profit or loss |
| Amortized cost |
| Fair value through profit or loss |
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
Trade Receivables |
| - |
| - |
| 2,200,342 |
| - |
Related parties |
| 415,918 |
| - |
| 149,981 |
| - |
Commodity forward contracts |
| - |
| - |
| - |
| 140,660 |
Derivative financial instruments |
| - |
| - |
| - |
| 37,667 |
Total |
| 415,918 |
|
|
| 2,350,323 |
| 178,327 |
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
Suppliers |
| - |
| - |
| 3,408,023 |
| - |
Lease liabilities |
| 4,504 |
| - |
| 173,277 |
| - |
Borrowings |
| - |
| - |
| 647,194 |
| - |
Agribusiness Receivables Certificates (CRA) |
| 416,852 |
| - |
| 405,565 |
| - |
Obligations to FIAGRO quota holders |
| - |
| - |
| 175,520 |
| - |
Payables for acquisition of subsidiaries |
| 6,827 |
| - |
| 181,960 |
| - |
Related parties |
| 319,083 |
| - |
| 459,909 |
| - |
Derivative financial instruments |
|
|
| - |
|
|
| 75,175 |
Salaries and social charges |
| 10,373 |
| - |
| 141,786 |
|
|
Commodity forward contracts |
| - |
| - |
|
|
| 65,957 |
Dividends payable |
| - |
|
|
| 411 |
|
|
Total |
| 757,639 |
| - |
| 5,593,645 |
| 141,132 |
The Company considers that financial assets and liabilities measured at amortized cost have carrying amounts that are close to their fair values; therefore, separate fair-value disclosure is not presented.
(a) Fair value hierarchy
The Company uses different methods to measure and determine fair value (including market approaches and income or cost approaches) and to estimate the amount that market participants would use to price the asset or liability. Financial assets and liabilities measured at fair value are classified and disclosed within the following levels of the fair value hierarchy:
Level 1 – Quoted (unadjusted) prices in active, liquid and visible markets for identical assets and liabilities that are readily available at the measurement date;
Level 2 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and
Level 3 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is not observable.
For assets and liabilities that are recognized in the separate and consolidated financial statements on a recurring basis at fair value, the Company determines whether transfers between levels of the hierarchy have occurred by reassessing the classification (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
All financial instruments measured at fair value are classified within level 2. As of June 30, 2025 and 2024, there were no changes in the fair value methodology for financial instruments and, therefore, no transfers between levels.
| 18 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except when otherwise indicated) |
|
| |
|
|
7. Financial and capital risk management
(a) Considerations on risk factors that may affect the Company's business
The Company is exposed to several market risk factors that may affect its business. The Company’s Board of Directors is responsible for monitoring these risk factors and for establishing policies and procedures to mitigate them. The Company’s risk management framework takes into account the size and complexity of its activities, which allows a better understanding of how such risks can impact the Company’s strategy through committees and other internal meetings.
Currently, the Company is focused on action plans related to risks that may have a significant impact on its strategic objectives, including those required by the applicable regulation. To efficiently manage and mitigate these risks, its risk management structure identifies risks and performs assessments to prioritize those that are critical to the pursuit of potential opportunities and/or that may prevent value creation or impair existing value, with the possibility of affecting its results, capital, liquidity, customer relationships and/or reputation.
The Company’s risk management strategies developed to mitigate and/or reduce financial market risks to which it is exposed are the following:
credit risk
liquidity risk
capital risk
interest rate risk
foreign exchange risk
commodity price risk in barter transactions
(b) Credit risk
Credit risk is the risk of financial loss if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and it arises mainly from the Company’s trade receivables. The Company holds financial investments and derivatives with financial institutions approved by Management, following objective criteria for diversification of such risk.
The Company seeks to mitigate its credit risk related to trade receivables by establishing credit limits for each counterparty based on the analysis performed by its credit management area. This determination of credit exposure is carried out considering the qualitative and quantitative information of each counterparty. The Company also relies on the diversification of its portfolio and monitors several solvency and liquidity indicators of its counterparties. In addition, mainly for installment receivables, the Company monitors the balance of the allowance for expected credit losses.
The main credit risk management strategies are listed below:
Definition of credit approval policies and procedures for new and existing customers;
Granting credit to qualified customers through:
o review of credit bureau reports, financial statements and/or credit references, when available;
o review of existing customers’ accounts every twelve months based on credit limit amounts;
o assessment of customers and regional risks;
o obtaining collateral through annotation of Rural Producer Notes (Cédulas do Produtor Rural – “CPR”), which grant the Company the physical ownership of the related agricultural products in the event of customer default;
| 19 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except when otherwise indicated) |
|
| |
|
|
Establishing credit approval for suppliers in the case of advance payments;
Setting up allowances using the lifetime expected credit loss model, considering all possible default events over the expected life of a financial instrument. Receivables are categorized based on the number of days past due and/or the customer’s credit risk profile. Estimated losses on receivables are based on known problem accounts and on historical losses. Receivables are considered to be in default and are written off against the allowance for doubtful accounts when it is likely that all remaining contractual amounts due will not be collected in accordance with the contract terms;
Requiring minimum acceptable counterparty credit ratings from financial counterparties;
Establishing limits for counterparties or credit exposure; and
Developing relationships with counterparties with investment grade.
The current credit policy sets credit limits for customers based on the credit score analysis performed by the Company’s credit management area. This score is determined by considering qualitative and quantitative information related to each customer, resulting in a rating classification and in a level of collateral requirement as follows:
|
|
|
|
|
| % of collateral required on sales | ||
Credit rating |
| % of customers |
| Risk classification |
| Medium-size farmers |
| Other |
AA&A |
| 24 |
| Very low |
| 80-90% |
| 0% |
B |
| 49 |
| Medium |
| 100% |
| 30% |
C&D |
| 15 |
| High |
| 100% |
| 60% |
Simplified |
| 12 |
| Small farmers |
| N/A |
| N/A |
Maximum expose to credit risk as of June 30, 2025 and 2024:
|
| Consolidated | ||
|
| 2025 |
| 2024 |
|
|
|
|
|
Trade Receivables |
| 1,273,339 |
| 2,200,342 |
Receivable from related parties |
| 211,804 |
| 149,981 |
Advances to suppliers |
| 347,391 |
| 228,576 |
Total |
| 1,832,534 |
| 2,578,899 |
(c) Liquidity risk
The Company defines liquidity risk as the risk of financial loss if it is unable to meet its payment obligations related to financial liabilities settled in cash or other financial assets as they fall due. The Company’s approach to managing this risk is to ensure that it has sufficient available cash to settle its obligations without incurring losses or affecting operations. Management has ultimate responsibility for managing liquidity risk and relies on a liquidity risk management model to manage the Company’s funding and liquidity needs in the short, medium and long term.
The Company’s cash position is monitored by Management through management reports and periodic performance meetings. The Company also manages its liquidity risk by maintaining cash reserves, bank credit lines and other funding lines considered adequate, through ongoing monitoring of forecast and actual cash flows, as well as through the matching of the maturities of financial assets and liabilities.
| 20 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
The following maturity analysis of the Company’s financial liabilities and derivative financial instruments settled on a gross basis (for which cash flows are settled simultaneously) is based on the expected undiscounted contractual cash flows from the reporting date to the contractual maturity date:
|
| Parent Company | ||||
|
|
|
|
|
| 2025 |
|
| Up to 1 year |
| From 1 to 3 years |
| Total |
|
|
|
|
|
|
|
Lease liabilities |
| 2,120 |
| 3,244 |
| 5,364 |
Agribusiness Receivables Certificates (CRA) |
| 481,364 |
| - |
| 481,364 |
Payables for acquisition of subsidiaries |
| 7,180 |
| - |
| 7,180 |
Related parties |
| 509,351 |
| - |
| 509,351 |
Derivative financial instruments |
| 25,523 |
| - |
| 25,523 |
Salaries and social charges |
| 26,395 |
| - |
| 26,395 |
Total |
| 1,051,933 |
| 3,244 |
| 1,055,177 |
|
| Consolidated | ||||
|
|
|
|
|
| 2025 |
|
| Up to 1 year |
| From 1 to 3 years |
| Total |
|
|
|
|
|
|
|
Trade payables |
| 2,957,987 |
| 88 |
| 2,958,075 |
Lease liabilities |
| 54,219 |
| 64,288 |
| 118,507 |
Borrowings |
| 514,562 |
| - |
| 514,562 |
Agribusiness Receivables Certificates (CRA) |
| 472,092 |
| - |
| 472,092 |
Obligations to FIAGRO quota holders |
| 527,079 |
| - |
| 527,079 |
Payables for acquisition of subsidiaries |
| 48,592 |
| 108,448 |
| 157,040 |
Related parties |
| 78,377 |
| - |
| 78,377 |
Commodity forward contracts |
| 38,138 |
| - |
| 38,138 |
Derivative financial instruments |
| 36,122 |
| - |
| 36,122 |
Salaries and social charges |
| 164,531 |
| - |
| 164,531 |
Dividends payable |
| 18,722 |
| - |
| 18,722 |
Total |
| 4,910,421 |
| 172,824 |
| 5,083,245 |
|
| Parent Company | ||||
|
|
|
|
|
| 2024 |
|
| Up to 1 year |
| From 1 to 3 years |
| Total |
|
|
|
|
|
|
|
Lease liabilities |
| 1,953 |
| 2,551 |
| 4,504 |
Payables for acquisition of subsidiaries |
| 6,827 |
| - |
| 6,827 |
Related parties |
| 319,083 |
| - |
| 319,083 |
Salaries and social charges |
| 10,373 |
| - |
| 10,373 |
Total |
| 338,236 |
| 2,551 |
| 340,787 |
| 21 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
|
| Consolidated | ||||
|
|
|
|
|
| 2024 |
|
| Up to 1 year |
| From 1 to 3 years |
| Total |
|
|
|
|
|
|
|
Trade payables |
| 3,407,431 |
| 592 |
| 3,408,023 |
Lease liabilities |
| 64,815 |
| 108,462 |
| 173,277 |
Borrowings |
| 647,029 |
| 165 |
| 647,194 |
Agribusiness Receivables Certificates (CRA) |
| 918 |
| 404,647 |
| 405,565 |
Obligations to FIAGRO quota holders |
| 175,520 |
| - |
| 175,520 |
Payables for acquisition of subsidiaries |
| 172,653 |
| 9,307 |
| 181,960 |
Related parties |
| 459,909 |
| - |
| 459,909 |
Commodity forward contracts |
| 65,641 |
| 316 |
| 65,957 |
Derivative financial instruments |
| 75,175 |
| - |
| 75,175 |
Salaries and social charges |
| 141,786 |
| - |
| 141,786 |
Dividends payable |
| 411 |
| - |
| 411 |
Total |
| 5,211,288 |
| 523,489 |
| 5,734,777 |
(d) Capital risk
The Company’s objective in managing capital is to ensure healthy leverage levels and access to capital to support its ongoing operations. The Company manages and adjusts its capital structure in light of changes in economic conditions and in the risk characteristics of its underlying assets. In view of the economic situation described in Note 1, the Company continues to monitor its capital structure by assessing projections of future results and cash flows and calculating the level of capital structure needed to ensure business continuity, holding periodic meetings with the Board of Directors to evaluate alternatives to restore balance.
The Company did not make any changes to its approach to capital management during the year.
(e) Interest Rate Risk
Fluctuations in interest rates, such as the Brazilian interbank deposit rate, which is an average of the interbank rates in Brazil (the “CDI”), may affect the cost of the Company’s borrowings and new borrowings.
The Company periodically monitors the effects of market changes in interest rates on its portfolio of financial instruments. Funds raised by the Company are used to finance working capital in each crop year and are substantially obtained under short-term conditions.
As of June 30, 2025 and 2024, the Company did not have derivative financial instruments used to hedge interest rate risk.
Sensitivity analysis – interest rate exposure
To mitigate its exposure to interest rate risk, the Company uses different scenarios to assess the sensitivity of changes in transactions impacted by the CDI rate.
Scenario 1 represents the impact on the carrying amounts considering the most recent CDI rates (September 2025) and reflects Management’s best estimates. Scenarios 2 and 3 consider an increase of 25% and 50%, respectively, in these market interest rates, before taxes, which represents a significant change in the probable scenario for sensitivity purposes.
| 22 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
The following table presents the possible impacts on the statements of profit or loss:
|
|
| 2025 | ||||
|
|
| Effect on profit and equity | ||||
| Index |
| Scenario 1 |
| Scenario 2 |
| Scenario 3 |
|
|
|
|
|
|
|
|
Floating-rate borrowings in Brazil | CDI rate (15.00%) |
| 64,964 |
| 78,349 |
| 91,735 |
Agribusiness Receivables Certificates (CRA) |
CDI rate (15.00%) |
| 75,896 |
| 91,235 |
| 106,574 |
Total |
|
| 140,860 |
| 169,584 |
| 198,309 |
(f) Foreign exchange risk
The Company is exposed to foreign exchange risk arising from its operations related to agricultural inputs, mainly the U.S. dollar, which significantly affects global prices of agricultural inputs in general. Although all purchases and sales are carried out locally, some purchase and sale contracts are indexed to the U.S. dollar.
The Company seeks to reduce this exposure by managing its price lists and commercial strategies in order to pursue a natural hedge between purchases and sales and to match, as much as possible, currency and terms.
The Company’s corporate treasury is responsible for monitoring the forecast cash flow exposure to the U.S. dollar and, whenever maturity and currency mismatches are identified, it enters into NDF (non-deliverable forward) derivative financial instruments to offset these exposures and thus comply with the internal policy requirements. Management is carried out through macro hedging, by analyzing the forecast cash flow for the next two crop years.
The Company’s Foreign Exchange Exposure Monitoring Committee meets periodically with the commercial, treasury and corporate departments. There are also purchase review and business intelligence committees for the main goods traded by the Company.
The Company does not apply hedge accounting. Accordingly, gains and losses from derivative transactions are fully recognized in profit or loss, as disclosed in Note 31.
(g) Sensitivity analysis – foreign exchange exposure
To measure its exposure to foreign exchange risk, the Company uses different scenarios to assess its foreign-currency-denominated asset and liability positions and their potential effects on its results.
Scenario 1 below represents the impact on the carrying amounts of the most recent market rates (October 24, 2025) for the U.S. dollar (R$ 5.3797 to US$ 1.00). This analysis assumes that all other variables, particularly interest rates, remain constant. Scenarios 2 and 3 consider an appreciation of the Brazilian real against the U.S. dollar of 25% and 50%, respectively, before taxes, which represents a significant change in the probable scenario for sensitivity purposes.
The table below presents the potential impacts in absolute amounts:
|
|
|
| 2025 | ||||
|
|
|
| Effect on income and equity | ||||
|
| Index |
| Scenario 1 |
| Scenario 2 |
| Scenario 3 |
|
|
|
|
|
|
|
|
|
Trade receivables in U.S. dollars |
| 5.3797 |
| (889) |
| 14,557 |
| 30,004 |
Trade payables in U.S. dollars |
| 5.3797 |
| 2,202 |
| (36,060) |
| (74,322) |
Borrowings in US dollars |
| 5.3797 |
| 1,283 |
| (21,018) |
| (43,320) |
Net impact on operating transactions |
|
|
| 2,596 |
| (42,521) |
| (87,638) |
|
|
|
|
|
|
|
|
|
Derivative Financial Instruments |
| 5.3797 |
| (367) |
| 6,016 |
| 12,399 |
|
|
|
|
|
|
|
|
|
Total impact, net of derivatives |
|
|
| 2,229 |
| (36,505) |
| (75,239) |
| 23 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(h) Commodity price risk in Barter transactions
In all barter transactions mentioned in Note 10, the Company uses the future price of commodities in the market as a reference to assess the quantities of commodities included in the commodity forward contracts to be delivered by customers as payment for the inputs sold by the Company in local currency. The Company uses prices quoted by commodity trading companies to measure grain purchase contracts with farmers. The Company enters into forward grain sales contracts with trading companies or into derivatives with financial institutions to sell those same grains, at the same price as the purchase contracts entered into with farmers. Thus, the Company’s strategy to manage its exposure to commodity prices is to execute purchase and sale contracts under similar conditions.
These transactions are conducted by a corporate department that manages and controls these contracts, as well as compliance with the Company’s policies.
(i) Sensitivity analysis – commodity price exposure
To measure its exposure to commodity price risk, the Company uses different scenarios to assess its asset and liability positions in soybean and corn Commodity forward contracts and their potential effects on its results.
The “probable” scenario below represents the impact on the carrying amounts as of June 30, 2024, with assumptions described in Note 10. The other scenarios consider an increase in the main assumptions at rates of 25% and 50%, before taxes, which represents a significant change in the probable scenario for sensitivity purposes.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2025 |
| Tons |
| Position |
| Current Risk |
| Average contract prices |
| Current Market Price |
| 25% |
| 50% | ||||
Position |
|
|
|
|
|
|
|
|
|
| Market price |
| Impact |
| Market price |
| Impact |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corn 2025 | 42,753 |
| Purchased |
| 32,330 |
| 44 |
| 45 |
| 57 |
| 8,083 |
| 68 |
| 16,165 |
Corn 2025 | (42,495) |
| Sold |
| (29,789) |
| (46) |
| 42 |
| 53 |
| (7,447) |
| 63 |
| (14,894) |
Corn 2026 | 109 |
| Purchased |
| (12) |
| 67 |
| (7) |
| (9) |
| (3) |
| (10) |
| (6) |
Soybeans 2025 | 367 |
| Purchased |
| 357 |
| 109 |
| 58 |
| 73 |
| 89 |
| 88 |
| 179 |
Soybeans 2025 | (789) |
| Sold |
| (778) |
| (115) |
| 59 |
| 74 |
| (195) |
| 89 |
| (389) |
Soybeans 2026 | 41,210 |
| Purchased |
| (2,227) |
| 116 |
| (3) |
| (4) |
| (557) |
| (5) |
| (1,113) |
Soybeans 2026 | (12,307) |
| Sold |
| 385 |
| (119) |
| (2) |
| (2) |
| 96 |
| (3) |
| 192 |
Grain contract exposure | 28,848 |
|
|
| 266 |
|
|
|
|
|
|
| 66 |
|
|
| 134 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corn 2025 | (16,272) |
| Sold on derivatives |
| (501) |
| 62 |
| 62 |
| 77 |
| (125) |
| 93 |
| (250) |
Corn 2026 | (108) |
| Sold on derivatives |
| 2 |
| 75 |
| 75 |
| 93 |
| 1 |
| 112 |
| 1 |
Soybeans 2026 | (28,781) |
| Sold on derivatives |
| 4,199 |
| 137 |
| 128 |
| 160 |
| 1,050 |
| 192 |
| 2,099 |
Derivatives exposure | (45,161) |
|
|
| 3,700 |
|
|
|
|
|
|
| 926 |
|
|
| 1,850 |
Net Exposure (i) | (16,313) |
|
|
| 3,966 |
|
|
|
|
|
|
| 992 |
|
|
| 1,984 |
(i) Exposure in relation to the 2025 corn purchase contracts for which there was early settlement of the physical contracts and the derivatives are being held until the original maturity.
| 24 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(j) Derivative financial instruments
The Company is exposed to market risks mainly related to fluctuations in foreign exchange rates and in commodity prices. The Company maintains transactions with derivative financial instruments to mitigate its exposure to these risks. The Company has been implementing and improving internal controls to identify and measure the effects of transactions with commodity trading companies and financial institutions, so that such transactions are captured, recognized and disclosed in the consolidated financial statements. The Company does not engage in speculative investments in derivatives or in any other high-risk assets. Trading derivatives are classified as current assets or current liabilities.
|
| Parent Company |
| Consolidated |
| 2025 | 2024 | 2025 | 2024 |
|
|
|
|
|
Commodity forward contracts (R$) | - | - | 1,199 | (21,772) |
Foreign currency forward contracts (US$) | - | - | (5,907) | 2,904 |
Swap interest rate (CDI vs. fixed rate) | (22,194) | - | (22,194) | (18,640) |
|
|
|
|
|
Total | (22,194) | - | (26,902) | (37,508) |
8. Inventories
Accounting policy
Inventories are stated at the lower of cost and net realizable value. The costs of individual inventory items are determined using the weighted average cost method, less any write-downs when applicable. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion (when applicable) and the estimated costs necessary to make the sale.
An inventory write-down is recognized for inventories that are close to their expiration date and are not expected to be sold.
(a) Composition of inventories
|
| Consolidated | ||
|
| 2025 |
| 2024 |
|
|
|
|
|
Goods for resale |
| 708,737 |
| 1,486,877 |
(-) Allowance for inventory losses |
| (64,252) |
| (49,537) |
Total |
| 644,485 |
| 1,437,340 |
(b) Allowance for inventory losses
|
| Consolidated | ||
|
| 2025 |
| 2024 |
|
|
|
|
|
Opening balance |
| (49,537) |
| (14,115) |
Additions |
| (14,715) |
| (31,318) |
Acquisition of a subsidiary (i) |
| - |
| (4,321) |
Translation adjustment |
| - |
| 217 |
Closing balance |
| (64,252) |
| (49,537) |
(i) Balances arising from the business combination that took place in the 2024 fiscal year. (Note 22).
| 25 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
9. Recoverable taxes
|
| Parent Company |
| Consolidated | ||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 |
|
|
|
|
|
|
|
|
|
ICMS (i) |
| - |
| - |
| 81,514 |
| 79,026 |
Federal taxes (ii) |
| 1,220 |
| 441 |
| 245,602 |
| 267,346 |
|
|
|
|
|
|
|
|
|
Total |
| 1,220 |
| 441 |
| 327,116 |
| 346,372 |
|
|
|
|
|
|
|
|
|
Current |
| 1,220 |
| 441 |
| 17,103 |
| 47,144 |
Non-current |
| - |
| - |
| 310,013 |
| 299,228 |
(i) The ICMS (value-added tax on sales and services) recoverable mainly relates to operations in the state of Paraná, where ICMS credits on purchases are maintained even when subsequent sales of goods are subject to exemption, deferral or reduced tax basis, which generates a credit balance of the tax.
(ii) Includes: (a) credits arising from the Social Integration Program (PIS) and the Social Contribution on Revenues (COFINS), as well as negative balances of corporate income tax (IRPJ) and social contribution on net income (CSLL). These credits, recognized in current assets, will be used by the Company to offset other federal taxes; (b) taxes withheld and overpaid amounts that can be used to settle past-due or future federal taxes payable, including IRPJ and CSLL credits arising from tax benefits on government grants; and (c) withholding income tax on cash equivalents that can be used to offset taxes due at the end of the calendar year, in the case of taxable income, or carried forward in the case of tax losses.
IRPJ and CSLL credits arising from ICMS grants
In the fiscal year ended June 30, 2025, the Company recognized balances of IRPJ and CSLL credits arising from the thesis of ICMS grants deducted from the tax bases of these taxes. The benefit covered grants used through December 2023, when the tax incentive ended due to a change in legislation. The balance presented in the statement of financial position is the remaining amount of what has already been refunded and/or offset against other federal taxes.
Pursuant to Article 30 of Law No. 12,973/2014, the amount of ICMS benefits classified as a government grant for investment must be allocated to the “tax incentive reserve” when there is sufficient profit in each subsidiary. In addition, under the same Law, these tax benefits must be included in the tax bases of IRPJ and CSLL when dividends are distributed or when capital is repaid to the shareholders of the subsidiaries.
As of June 30, 2025, the balance of the tax incentive reserve in the subsidiaries corresponds to a consolidated amount of R$ 430,185, and the balance of tax benefit not yet allocated to that reserve, due to insufficient profits for such allocation, corresponds to a consolidated amount of R$ 881,225. The Company does not intend to distribute the incentive amounts to its shareholders. In the event of a dividend distribution, taxation will apply, as established in the tax laws.
10. Commodity forward contracts
For certain contracts with customers, the Company sells agricultural inputs (for example, fertilizers, crop protection products, seeds) on a deferred basis in exchange for the future delivery of grains, mainly soybeans and corn, at the time of harvest (“barter transactions”).
A contract (grain purchase agreement) is signed between the Company and the customer, under which the Company and the customer agree on a volume of grain to be delivered at harvest, which is equivalent to the total selling price of the inputs, based on the future price of the grain on the date the contract with the customer is entered into. The customer’s main obligation under this contract is to deliver the agreed volume of grain as payment at a future date.
At the same time, the Company enters into a forward grain sales contract with a commodity trading company, under which the Company commits to deliver the commodity to be received from the customer under the input sale transaction. The Company’s strategy is to enter into this contract for the same quantity and on the same terms as the contract between the Company and its customer. While the physical sale of the grain to the trading companies is not completed, the Company may enter into a derivative contract on commodity and futures exchanges, such as CBOT, ICE or B3, for a period equivalent to that associated with the physical grain purchases, in order to mitigate exposure to price fluctuations. Consequently, the Company maintains these derivative contracts to naturally hedge against market volatility. Once the physical sale of the grain is completed, the derivative contracts are promptly settled to realize the related gains or losses.
| 26 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
If the customer does not deliver the committed volume of commodity at harvest — for example, due to a significant increase in the commodity price — the Company is required to:
• purchase the commodity in the spot market and deliver it to the commodity trading company; or
• pay compensation to the commodity trading company in an amount equal to the difference between the commodity price at the delivery date and the price at the contract date (“washout risk”).
The Company is entitled to charge its customers for any losses arising from the settlement of its obligations above with the commodity trading companies.
Although these contracts are physically settled (purchase and sale of grains), in accordance with IFRS 9 the Company designates, at initial recognition, these Commodity forward contracts as measured at fair value through profit or loss.
The fair value of the commodity forward contracts entered into with the customer and with the commodity trading company is estimated based on market information and specific valuation methodologies and discounted to present value, considering the contractual conditions and current market prices for such commodities. These contracts are presented on a gross basis in the statement of financial position. When the Company settles the grain purchase and sale contracts, the related cost and revenue are recognized for the cash consideration paid, plus the fair value of the commodity forward contracts at the settlement date.
Critical accounting estimates and judgments
The fair value of commodity forward contracts is estimated on a regional basis and is based on commodity prices available in the foreign futures markets, over-the-counter premium quotations from market participants and expected freight costs estimated by the Company considering historical overland freight data.
As of June 30, 2025, the fair value of commodity forward contracts is as follows:
| Consolidated | |||
|
| 2025 |
| 2024 |
|
|
|
|
|
Assets |
|
|
|
|
Purchase contracts |
| 33,081 |
| 132,362 |
Sales contracts |
| 511 |
| 8,298 |
|
|
|
|
|
Current |
| 33,592 |
| 137,660 |
Non-current |
| - |
| 3,000 |
|
|
|
|
|
Liabilities |
|
|
|
|
Purchase contracts |
| (2,469) |
| (10,549) |
Sales contracts |
| (30,695) |
| (55,408) |
|
|
|
|
|
Current |
| (33,164) |
| (65,641) |
Non-current |
| - |
| (316) |
| 27 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
The main assumptions used in the calculation of fair value are as follows:
| Outstanding Volume (tons) | Average of contract prices R$/bag | Average market prices (Corn R$/ bag (ii); Soybean US$/bu (i)) | Soybean market premium (US$/bu) | Freight (R$/ton) |
Purchase contracts |
|
|
|
|
|
Soybean |
|
|
|
|
|
As of June 30, 2024 | 365,894 | 112.97 | 11.27 | 0.58 | 378.64 |
As of June 30, 2025 | 41,576 | 116.06 | 10.66 | 0.44 | 398.17 |
Corn |
|
|
|
|
|
As of June 30, 2024 | 211,895 | 45.19 | 65.08 | N/A | 257.28 |
As of June 30, 2025 | 42,862 | 44.38 | 61.99 | 3.92 | 169.22 |
|
|
|
|
|
|
Sales contracts |
|
|
|
|
|
Soybean |
|
|
|
|
|
As of June 30, 2024 | 141,069 | 112.71 | 11.30 | 0.55 | 410.70 |
As of June 30, 2025 | 13,096 | 118.74 | 10.63 | 0.67 | 331.05 |
Corn |
|
|
|
|
|
As of June 30, 2024 | 176,978 | 38.27 | 59.58 | 1 | 257.29 |
As of June 30, 2025 | 42,495 | 45.92 | 61.96 | 3.83 | 175.17 |
(i) Market price published by the Chicago Board of Trade (CBOT), an exchange in the United States where options and futures contracts are traded.
(ii) Market price published by B3 S.A. – Brasil, Bolsa, Balcão, the Brazilian exchange where options and futures contracts are traded.
11. Advances to suppliers
Advances to suppliers arise from the “cash purchases” modality, under which the Company makes advance payments to agricultural input suppliers at the beginning of the crop year and before the actual physical delivery of the products. These advances are short term and are part of the Company’s strategy to build margins and to secure product quality and availability.
12. Right-of-use assets and lease liabilities
Accounting policy
The Company leases office buildings for its administrative functions, retail stores, equipment and vehicles. In general, lease contracts have terms ranging from three to nine years, but they may include renewal options.
Lease terms are negotiated on an individual basis and contain different terms and conditions. Leases contracts have no restrictive covenants; leased assets cannot be pledged as collateral for borrowings.
| 28 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
Right-of-use assets
The Company recognizes right-of-use assets at the lease commencement date. Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognized, restoration costs, any initial direct costs incurred and lease payments made at or before the commencement date, less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the underlying assets, as follows:
Vehicles | 3.5 years |
Land and buildings | 5.3 years |
Machinery and equipment | 3 years |
Lease liabilities
At the commencement date of the lease, the Company recognizes lease liabilities measured at the present value of lease payments to be made over the lease term. Lease payments include:
fixed payments (including in-substance fixed payments), less any lease incentives receivable;
amounts expected to be payable by the lessee under residual value guarantees; and
the exercise price under a purchase option if the lessee is reasonably certain to exercise that option.
Lease payments are discounted using the Company’s incremental borrowing rate, which is the rate that the lessee would have to pay to borrow the funds necessary to obtain an asset of a similar value in a similar economic environment, with similar terms and conditions.
In determining the incremental borrowing rate, the Company:
whenever possible, uses recent financing contracts obtained from third parties as a starting point, adjusted to reflect changes in financing conditions since those borrowings were obtained;
uses a build-up approach that starts with a risk-free interest rate and adds a credit spread;
uses a build-up approach that considers a risk-free interest rate adjusted for credit risk for leases held by the Company when it does not have recent financing from third parties; and
makes specific adjustments to the rate, term, country, currency and collateral.
Lease payments are allocated between principal and finance costs. Finance costs are recognized in profit or loss over the lease term so as to produce a constant periodic interest rate on the remaining balance of the liability for each period.
Payments for short-term leases of equipment and vehicles and low-value assets are expensed as incurred. Short-term leases are those with a lease term of 12 months or less. Low-value assets include IT equipment, small office furniture and other low-value items.
As of June 30, 2025 and 2024, the Company did not have lease contracts with variable lease payments.
| 29 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(a) Right-of-use assets
|
| Parent Company | ||||
|
| Buildings |
| Machinery and equipment |
| Total |
|
|
|
|
|
|
|
Cost |
| 4,964 |
| 5,462 |
| 10,426 |
Accumulated amortization |
| (2,345) |
| (3,860) |
| (6,205) |
As of June 30, 2024 |
| 2,619 |
| 1,602 |
| 4,221 |
|
|
|
|
|
|
|
Cost |
| 6,983 |
| 5,425 |
| 12,408 |
Accumulated amortization |
| (3,342) |
| (4,837) |
| (8,179) |
As of June 30, 2025 |
| 3,641 |
| 588 |
| 4,229 |
|
| Consolidated | ||||||
|
| Vehicles |
| Buildings |
| Machinery and equipment |
| Total |
|
|
|
|
|
|
|
|
|
Cost |
| 98,991 |
| 163,985 |
| 86,347 |
| 349,323 |
Accumulated amortization |
| (52,699) |
| (97,234) |
| (39,098) |
| (189,031) |
As of June 30, 2024 |
| 46,292 |
| 66,751 |
| 47,249 |
| 160,292 |
|
|
|
|
|
|
|
|
|
Cost |
| 99,811 |
| 162,224 |
| 85,637 |
| 347,672 |
Accumulated amortization |
| (75,762) |
| (127,678) |
| (51,507) |
| (254,947) |
As of June 30, 2025 |
| 24,049 |
| 34,546 |
| 34,130(i) |
| 92,725 |
(i) Reduction due to reorganization and store closures (Note 1)
Depreciation expense of right-of-use assets for the fiscal year ended June 30, 2025 was R$ 2,281 and R$ 62,604 for the Parent company and Consolidated, respectively (R$ 2,290 and R$ 70,059 as of June 30, 2024).
(b) Lease liabilities
|
| Parent Company |
| Consolidated | ||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 |
|
|
|
|
|
|
|
|
|
Vehicles |
| - |
| - |
| 28,194 |
| 49,808 |
Buildings |
| 4,036 |
| 2,845 |
| 61,076 |
| 92,792 |
Machinery and equipment |
| 628 |
| 1,659 |
| 13,779 |
| 30,677 |
Total |
| 4,664 |
| 4,504 |
| 103,049(i) |
| 173,277 |
|
|
|
|
|
|
|
|
|
Current |
| 1,843 |
| 1,953 |
| 47,147 |
| 64,815 |
Non-current |
| 2,821 |
| 2,551 |
| 55,902 |
| 108,462 |
(i) Reduction due to reorganization and store closures (Note 1)
Interest on lease liabilities incurred in the fiscal year ended June 30, 2025 was R$ 527 and R$ 11,849 for the Parent company and Consolidated, respectively (R$ 460 and R$ 15,082 as of June 30, 2024).
| 30 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
13. Investments
Accounting Policy
Investments are accounted for using the equity method and are initially recognized at cost. The investment in subsidiaries includes goodwill identified on acquisition, net of any accumulated impairment losses. The share of profit or loss of subsidiaries is recognized in profit or loss.
Fiscal year ended June 30, 2025 and 2024
|
| 2025 |
| 2024 |
|
|
|
|
|
Investments |
| 2,769 |
| 926,851 |
Allowance for losses |
| (1,604,194) |
| - |
Total |
| (1,601,425) |
| 926,851 |
(a) Movement in investments
|
| Equity |
|
|
|
| ||
Equity method | 2024 | Profit (loss) for the year | Other comprehensive results | Capital transaction | Impairment Losses | Amortization of fair value | Dividends | 2025 |
Investee |
|
|
|
|
|
|
|
|
Lavoro Agrocomercial S.A. (ii) | 230,754 | (926,635) | - | (9,321) | - | - | - | (705,201) |
Distribuidora Pitangueiras de Produtos Agropecuários S.A. (ii) |
481,462 | (1,062,761) |
(343) |
- | - | - |
(2,477) | (584,119) |
Produtec Comércio e Representações S.A. (ii) |
54,430 |
(368,035) |
- |
(1,269) | - | - | - | (314,874) |
Gestão e Transformação Consultoria S.A. |
2,101 |
668 | - | - | - | - | - | 2,769 |
| 768,747 | (2,356,762) | (343) | (10,590) | - | - | (2,477) | (1,601,425) |
|
|
|
|
|
|
|
|
|
Goodwill and fair value set-up |
|
|
|
|
|
|
|
|
Lavoro Agrocomercial S.A. (i) | 68,102 | - | - | - | (68,074) | (28) | - | - |
Distribuidora Pitangueiras de Produtos Agropecuários S.A. (i) | 78,609 | - | - | - | (75,897) | (2,712) | - | - |
Produtec Comércio e Representações S.A. (i) | 11,393 | - | - | - | (11,393) | - | - | - |
| 158,104 | - | - | - | (155,364) | (2,740) | - | - |
|
|
|
|
|
|
|
|
|
Total | 926,851 | (2,356,762) | (343) | (10,590) | (155,364) | (2,740) | (2,477) | (1,601,425) |
(i) Amounts arising from the write-off of goodwill and fair value adjustments on the investment as a result of the impairment test (see Note 16).
(ii) The negative equity-method balance arises from the recognition of losses that exceeded the carrying amount of the investment and is therefore presented in non-current liabilities as an allowance for losses on investments.
| 31 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
Fiscal Year Ended June 30, 2024
|
| Equity |
|
|
|
|
| |
Equity method | 2023 | Profit (loss) for the year | Other comprehensive results | Capital increase | Capital transaction | Amortization of fair value | Dividends | 2024 |
Investee |
|
|
|
|
|
|
|
|
Lavoro Agrocomercial S.A. | 612,118 | (381,407) | - |
| 43 | - | - | 230,754 |
Distribuidora Pitangueiras de Produtos Agropecuários S.A. | 472,836 | (133,114) | 754 | 157,570 | (11,168) | - | (5,416) | 481,462 |
Produtec Comércio e Representações S.A. | 151,038 | (99,915) | - | 3,775 | (468) | - | - | 54,430 |
Gestão e Transformação Consultoria S.A. | 1,110 | 991 | - | - | - | - | - | 2,101 |
| 1,237,102 | (613,445) | 754 | 161,345 | (11,593) | - | (5,416) | 768,747 |
|
|
|
|
|
|
|
|
|
Goodwill and fair value set-up |
|
|
|
|
|
|
|
|
Lavoro Agrocomercial S.A. | 68,376 | - | - | - | - | (274) | - | 68,102 |
Distribuidora Pitangueiras de Produtos Agropecuários S.A. | 84,628 | - | - | - | - | (6,019) | - | 78,609 |
Produtec Comércio e Representações S.A. | 11,914 | - | - | - | - | (522) | - | 11,393 |
| 164,919 | - | - | - | - | (6,814) | - | 158,104 |
|
|
|
|
|
|
|
|
|
Total | 1,402,021 | (613,445) | 754 | 161,345 | (11,593) | (6,814) | (5,416) | 926,851 |
| 32 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(b) Summary of Financial Information
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2025 |
Controlled |
| Control |
| Current Assets |
| Current liabilities |
| Non-current assets |
| Non-current liabilities |
| Equity |
| Profit (loss) |
Lavoro Agrocomercial S.A. |
| Direct |
| 1,149,477 |
| 1,530,583 |
| (309,865) |
| 15,078 |
| 258,613 |
| (964,662) |
Agrocontato Comércio e Representações de Produtos Agropecuários S.A. |
| Indirect |
| 86,566 |
| 154,675 |
| 1,922 |
| 865 |
| (13,944) |
| (53,109) |
PCO Comércio, Importação e Exportação e Agropecuária Ltda. |
| Indirect |
| 6,153 |
| 80,493 |
| (56,705) |
| 977 |
| 47,177 |
| (179,198) |
Agrovenci Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 457,199 |
| 528,397 |
| 16,813 |
| 2,661 |
| 93,874 |
| (150,920) |
Agrovenci Distribuidora de Insumos Agrícolas Ltda. (MS) |
| Indirect |
| 63,052 |
| 123,255 |
| 5,735 |
| 3,802 |
| (24,965) |
| (33,304) |
Produttiva Agronegócios Comércio e Representação Ltda. |
| Indirect |
| 188,857 |
| 129,490 |
| 2,945 |
| 483 |
| 73,141 |
| (11,312) |
Facirolli Comércio e Representação S.A. (Agrozap) |
| Indirect |
| 108,246 |
| 237,633 |
| (1,247) |
| 3,999 |
| (15,448) |
| (119,186) |
Central Agrícola Rural Distribuidora de Defensivos Ltda. |
| Indirect |
| 295,726 |
| 462,910 |
| 20,795 |
| 2,150 |
| 13,523 |
| (162,062) |
Distribuidora Pitangueiras de Produtos Agropecuários S.A. |
| Direct |
| 489,438 |
| 1,241,658 |
| 169,206 |
| 9,744 |
| 520,196 |
| (1,112,953) |
Produtec Comércio e Representações S.A. |
| Direct |
| 241,863 |
| 545,871 |
| (30,999) |
| 3,379 |
| 64,065 |
| (402,451) |
Qualiciclo Agrícola S.A. |
| Indirect |
| 302,248 |
| 341,350 |
| 45,620 |
| 3,953 |
| 103,793 |
| (101,229) |
Desempar Participações Ltda. |
| Indirect |
| 52 |
| - |
| 186,059 |
| - |
| 245,296 |
| (59,184) |
Cultivar Agrícola Comércio, Importação e Exportação S.A. |
| Indirect |
| 371,263 |
| 422,944 |
| 9,871 |
| 4,446 |
| 56,512 |
| (102,768) |
Nova Geração Comércio e Produtos Agrícolas Ltda. |
| Indirect |
| 72,887 |
| 57,052 |
| 1,985 |
| 1,546 |
| 26,889 |
| (10,616) |
Denorpi Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 164,667 |
| 172,541 |
| 3,448 |
| 1,540 |
| 12,819 |
| (18,784) |
Deragro Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 304,122 |
| 265,104 |
| 3,209 |
| 917 |
| 50,046 |
| (8,733) |
Desempar Tecnologia Ltda. |
| Indirect |
| - |
| - |
| - |
| - |
| - |
| - |
Futuragro Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 509,050 |
| 340,527 |
| (2,754) |
| 2,287 |
| 188,196 |
| (24,713) |
Plenafértil Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 52,648 |
| 65,002 |
| 389 |
| 79 |
| (6,031) |
| (6,013) |
Realce Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 48,371 |
| 55,695 |
| 125 |
| 42 |
| 2,130 |
| (9,372) |
Casa Trevo Participações S.A. |
| Indirect |
| 839 |
| 648 |
| 63,152 |
| - |
| 65,200 |
| (1,857) |
Casa Trevo Comercial Agrícola LTDA. |
| Indirect |
| 47,154 |
| 18,597 |
| 1,721 |
| 845 |
| 30,081 |
| (649) |
CATR Comercial Agrícola LTDA. |
| Indirect |
| 83,516 |
| 50,021 |
| 419 |
| 196 |
| 34,914 |
| (1,195) |
Floema Soluções Nutricionals de Cultivos Ltda. |
| Indirect |
| 213,391 |
| 223,927 |
| 3,597 |
| 1,361 |
| 7,642 |
| (15,944) |
Sollo Sul Insumos Agrícolas Ltda. |
| Indirect |
| 160,174 |
| 153,078 |
| 24,719 |
| 3,514 |
| 33,469 |
| (5,166) |
Dissul Agricultural Inputs Ltda. |
| Indirect |
| 28,006 |
| 22,204 |
| 72 |
| 23 |
| 6,901 |
| (1,052) |
Perterra Trading S.A. |
| Indirect |
| 135,623 |
| 126,959 |
| 208 |
| - |
| 1,906 |
| 6,965 |
Reference Agroinsumos Ltda. |
| Indirect |
| 72,498 |
| 96,563 |
| 1,703 |
| 1,409 |
| (8,542) |
| (15,229) |
CORAM - Comércio e Representações Agrícolas Ltda. |
| Indirect |
| 147,750 |
| 194,252 |
| 6,362 |
| 3,111 |
| (16,058) |
| (27,193) |
| 33 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
| ||||||||||||||
| |||||||||||||||
|
| ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2024 | |
Controlled |
| Control |
| Current Assets |
| Current liabilities |
| Non-current assets |
| Non-current liabilities |
| Equity |
| Profit (loss) | |
Lavoro Agrocomercial S.A. |
| Direct |
| 1,779,970 |
| 1,766,101 |
| 323,512 |
| 20,129 |
| 628,316 |
| (311,064) | |
Agrocontato Comércio e Representações de Produtos Agropecuários S.A. |
| Indirect |
| 99,944 |
| 135,957 |
| 23,080 |
| 833 |
| (13,534) |
| (232) | |
PCO Comércio, Importação e Exportação e Agropecuária Ltda. |
| Indirect |
| 23,799 |
| 78,261 |
| 101,684 |
| 45 |
| 98,833 |
| (51,656) | |
Agrovenci Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 692,225 |
| 619,490 |
| 32,701 |
| 7,115 |
| 148,344 |
| (50,023) | |
Agrovenci Distribuidora de Insumos Agrícolas Ltda. (MS) |
| Indirect |
| 88,951 |
| 119,265 |
| 16,063 |
| 4,336 |
| (10,089) |
| (8,498) | |
Produttiva Agronegócios Comércio e Representação Ltda. |
| Indirect |
| 243,405 |
| 171,876 |
| 4,681 |
| 1,857 |
| 76,716 |
| (2,363) | |
Facirolli Comércio e Representação S.A. (Agrozap) |
| Indirect |
| 189,223 |
| 260,776 |
| 61,075 |
| 4,949 |
| 43,092 |
| (58,519) | |
Central Agrícola Rural Distribuidora de Defensivos Ltda. |
| Indirect |
| 585,173 |
| 580,542 |
| 13,012 |
| 3,151 |
| 37,277 |
| (22,785) | |
Distribuidora Pitangueiras de Produtos Agropecuários S.A. |
| Direct |
| 741,905 |
| 1,281,447 |
| 1,048,348 |
| 17,916 |
| 656,717 |
| (165,827) | |
Produtec Comércio e Representações S.A. |
| Direct |
| 411,795 |
| 550,182 |
| 215,067 |
| 5,386 |
| 176,596 |
| (105,302) | |
Qualiciclo Agrícola S.A. |
| Indirect |
| 387,068 |
| 371,472 |
| 95,595 |
| 6,374 |
| 121,777 |
| (16,960) | |
Desempar Participações Ltda. |
| Indirect |
| 60 |
| - |
| 238,764 |
| - |
| 256,814 |
| (17,990) | |
Cultivar Agrícola Comércio, Importação e Exportação S.A. |
| Indirect |
| 478,327 |
| 379,514 |
| 18,516 |
| 11,140 |
| 129,012 |
| (22,823) | |
New Generation |
| Indirect |
| 61,593 |
| 38,715 |
| 2,980 |
| 2,146 |
| 31,990 |
| (8,278) | |
Denorpi Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 158,895 |
| 146,725 |
| 7,079 |
| 737 |
| 27,999 |
| (9,487) | |
Deragro Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 277,876 |
| 234,627 |
| 6,154 |
| 698 |
| 59,383 |
| (10,678) | |
Desempar Tecnologia Ltda. |
| Indirect |
| - |
| - |
| - |
| - |
| - |
| - | |
Futuragro Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 498,465 |
| 328,873 |
| 8,132 |
| 1,673 |
| 170,516 |
| 5,535 | |
Plenafértil Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 30,425 |
| 37,657 |
| 2,658 |
| 274 |
| (1,588) |
| (3,260) | |
Realce Distribuidora de Insumos Agrícolas Ltda. |
| Indirect |
| 52,333 |
| 51,733 |
| 3,035 |
| 190 |
| 6,256 |
| (2,811) | |
Casa Trevo Participações S.A. |
| Indirect |
| 168 |
| 1 |
| 67,935 |
| - |
| 70,635 |
| (2,533) | |
Casa Trevo Comercial Agrícola LTDA. |
| Indirect |
| 56,434 |
| 24,964 |
| 2,692 |
| 1,780 |
| 35,466 |
| (3,084) | |
CATR Comercial Agrícola LTDA. |
| Indirect |
| 66,739 |
| 31,421 |
| 645 |
| 410 |
| 34,999 |
| 554 | |
Floema Soluções Nutricionals de Cultivos Ltda. |
| Indirect |
| 182,026 |
| 173,366 |
| 4,931 |
| 2,522 |
| 24,017 |
| (12,948) | |
Sollo Sul Insumos Agrícolas Ltda. |
| Indirect |
| 197,359 |
| 172,879 |
| 27,310 |
| 6,537 |
| 62,821 |
| (17,568) | |
Dissul Agricultural Inputs Ltda. |
| Indirect |
| 14,132 |
| 7,366 |
| 122 |
| 78 |
| 6,960 |
| (150) | |
Perterra Trading S.A. |
| Indirect |
| 63,275 |
| 58,143 |
| 423 |
| - |
| 1,286 |
| 4,269 | |
Reference Agroinsumos Ltda. |
| Indirect |
| 91,906 |
| 84,331 |
| 6,266 |
| 2,246 |
| 20,603 |
| (9,008) | |
CORAM - Comércio e Representações Agrícolas Ltda. |
| Indirect |
| 121,950 |
| 139,332 |
| 8,410 |
| 4,141 |
| (13,373) |
| 260 | |
| 34 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(c) Acquisition of non-controlling interests
A change in the ownership interest in a subsidiary, without a loss of control, is accounted for as an equity transaction. When the proportion of equity held by non-controlling interests changes, the Company adjusts the carrying amount of the controlling and non-controlling interests to reflect the changes in their relative interests in the subsidiary. The Company recognizes directly in equity any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received.
Increase in ownership interest during the fiscal year ended June 30, 2025
Entity |
| Increase in ownership |
Facirolli Comércio e Representação S.A. (Agrozap) |
| 12.46% |
Produtec Comércio e Representações S.A. |
| 5.21% |
Lavoro Agrocomercial S.A. |
| 2.45% |
During the fiscal year ended June 30, 2025, the Company increased its ownership in its subsidiaries through a share-for-share transaction. As part of this transaction, Lavoro Limited S.A., the parent of Lavoro Agro Holding S.A., issued new shares to be delivered to the non-controlling shareholders of Lavoro Agro Holding S.A.’s subsidiaries, as consideration for the acquisition of additional interests. The transaction did not involve any cash movement and was recognized simultaneously in investments and in consolidated equity, with no impact on profit or loss for the year, in accordance with the accounting policies applicable to transactions between shareholders.
Acquisitions during the fiscal year ended June 30, 2024
The Company acquired an additional 0.006% interest in Lavoro Agrocomercial for R$ 52. The carrying amount of the 0.006% non-controlling interest was R$ 41. The Company recognized a decrease in non-controlling interests of R$ 41 and a decrease in the parent company’s net investment of R$ 11.
14. Property, plant and equipment
Accounting policy
Property, plant and equipment items are measured at historical acquisition or construction cost, less accumulated depreciation. When significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate components of property, plant and equipment. Any gains and losses on the disposal of an item of property, plant and equipment are recognized in profit or loss. Subsequent costs are capitalized only when it is probable that future economic benefits associated with the expenditure will flow to the Company.
Depreciation is calculated, and residual values are estimated, on a straight-line basis over the estimated useful lives of the assets. Depreciation is recognized in profit or loss. Land is not depreciated. The estimated useful lives of property, plant and equipment are as follows:
Category |
| Useful life |
Vehicles |
| 5 years |
Buildings and improvements |
| 25 years |
Machinery, equipment and facilities |
| 10 years |
Furniture and fixtures |
| 10 years |
IT equipment |
| 5 years |
The Company uses the estimated useful lives of assets to depreciate property, plant and equipment. At the end of each financial year, this estimate is reviewed and, if necessary, adjusted prospectively.
| 35 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
The carrying amount of an asset is immediately written down to its recoverable amount when the carrying amount exceeds its estimated recoverable amount.
Gains and losses on disposals are determined by comparing the proceeds from the sale with the asset’s carrying amount and are recognized in “Other (expenses) income, net” in the statement of profit or loss.
Property, plant and equipment were tested for impairment as of June 30, 2025, and no impairment loss was recognized during the year.
Property, plant and equipment balance
|
|
|
|
|
|
|
| Parent Company | ||
|
| Buildings and improvements |
| Machinery, equipment and facilities |
| Furniture and fixtures |
| IT equipment |
| Total |
As of June 30, 2023 |
| 19,988 |
| 377 |
| 44 |
| 50 |
| 20,459 |
|
|
|
|
|
|
|
|
|
|
|
Cost |
| 19,595 |
| 1 |
| 118 |
| 244 |
| 19,958 |
Accumulated depreciation |
| (2,289) |
| (1) |
| (35) |
| (216) |
| (2,541) |
As of June 30, 2024 |
| 17,306 |
| - |
| 83 |
| 28 |
| 17,417 |
|
|
|
|
|
|
|
|
|
|
|
Cost |
| 9,158 |
| 1 |
| 129 |
| 244 |
| 9,532 |
Accumulated depreciation |
| (2,864) |
| (1) |
| (47) |
| (227) |
| (3,139) |
As of June 30, 2025 |
| 6,294 |
| - |
| 82 |
| 17 |
| 6,393 |
|
| Consolidated | ||||||||||
|
| Vehicles |
| Buildings and improvements |
| Machinery, equipment and facilities |
| Furniture and fixtures |
| IT equipment |
| Total |
As of June 30, 2023 |
| 7,768 |
| 43,605 |
| 11,162 |
| 6,778 |
| 603 |
| 69,916 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost |
| 32,994 |
| 62,358 |
| 32,498 |
| 14,413 |
| 6,740 |
| 149,003 |
Accumulated depreciation |
| (27,244) |
| (14,498) |
| (14,052) |
| (7,639) |
| (6,740) |
| (70,173) |
As of June 30, 2024 |
| 5,750 |
| 47,860 |
| 18,446 |
| 6,774 |
| - |
| 78,830 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost |
| 29,599 |
| 49,894 |
| 29,482 |
| 14,632 |
| 7,193 |
| 130,800 |
Accumulated depreciation |
| (25,511) |
| (21,604) |
| (16,177) |
| (8,666) |
| (6,395) |
| (78,353) |
As of June 30, 2025 |
| 4,088 |
| 28,290 |
| 13,305 |
| 5,966 |
| 798 |
| 52,447 |
Depreciation expense on property, plant and equipment recorded for the fiscal year ended June 30, 2025 for the Parent company and the Consolidated amounted to R$ 2,448 and R$ 14,239, respectively (R$ 1,309 and R$ 12,031 as of June 30, 2024).
| 36 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
15. Intangible assets
Accounting policy
Intangible assets are recorded at acquisition cost or at the fair value of intangible assets acquired in a business combination and, for intangible assets with finite useful lives, less accumulated amortization calculated on a straight-line basis. These intangible assets have finite useful lives based on their economic lives.
Goodwill arising from a business combination is initially measured as the excess of the consideration transferred over the fair value of the net assets acquired (identifiable net assets acquired and liabilities assumed). After initial recognition, goodwill is measured at cost, less any accumulated impairment losses, as described in Note 16.
The useful lives and amortization methods of intangible assets are reviewed at each reporting date and adjusted prospectively, if appropriate. In 2025, useful lives were reviewed and no material changes were identified.
Estimated useful lives of intangible assets for the years ended June 30, 2025 and 2024 are as follows:
Category |
| Useful life |
Customer Relationship |
| 9 years |
Purchase Contracts |
| 4 years |
Software and other |
| 5 years |
An intangible asset is derecognized when disposed of or when no future economic benefits are expected and any gain or loss is recognized in profit or loss when the asset is written off.
The impairment policy for intangible assets is described in Note 16.
Intangible assets balance
| Parent Company |
| Software and other |
|
|
|
|
Opening balance | 26,276 |
Additions | 23,948 |
Amortization | (12,950) |
Carrying amount, net | 37,274 |
|
|
As of June 30, 2024 |
|
Cost | 69,109 |
Accumulated amortization | (31,835) |
Carrying amount, net | 37,274 |
|
|
Additions | 20,176 |
Amortization | (14,944) |
Carrying amount, net | 42,506 |
|
|
As of June 30, 2025 |
|
Cost | 89,285 |
Accumulated amortization | (46,779) |
Carrying amount, net | 42,506 |
| 37 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
| Consolidated | ||||||||
| Goodwill |
| Customer relationships |
| Purchase contracts |
| Software and other |
| Total |
As of June 30, 2024 |
|
|
|
|
|
|
|
|
|
Cost | 659,402 |
| 372,488 |
| 8,782 |
| 85,713 |
| 1,126,385 |
Accumulated amortization and impairment |
|
| (180,351) |
| (7,677) |
| (44,083) |
| (232,111) |
Carrying amount, net | 659,402 |
| 192,137 |
| 1,105 |
| 41,630 |
| 894,274 |
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended June 30, 2025 |
|
|
|
|
|
|
|
|
|
Opening balance | 659,402 |
| 192,137 |
| 1,105 |
| 41,630 |
| 894,274 |
Additions | - |
| - |
| - |
| 12,529 |
| 12,529 |
Impairment (i) | (660,054) |
| (162,203) |
| - |
| - |
| (822,257) |
Other (ii) | 652 |
| (3,198) |
| - |
| - |
| (2,546) |
Amortization | - |
| (26,736) |
| (1,105) |
| (7,671) |
| (35,512) |
Carrying amount, net | - |
| - |
| - |
| 46,488 |
| 46,488 |
|
|
|
|
|
|
|
|
|
|
As of June 30, 2025 |
|
|
|
|
|
|
|
|
|
Cost | 660,054 |
| 369,290 |
| 8,782 |
| 98,242 |
| 1,136,368 |
Accumulated amortization and Impairment | (660,054) |
| (369,290) |
| (8,782) |
| (51,754) |
| (1,089,880) |
Carrying amount, net | - |
| - |
| - |
| 46,488 |
| 46,488 |
(i) Amounts arising from the write-off of goodwill and fair value adjustments on the investment as a result of the impairment test (see Note 16).
(ii) Balances arising from purchase price adjustments of the acquisitions. The consideration for each acquisition was subject to post-closing price adjustments based on changes in the working capital of the acquired company.
16. Impairment testing of non-financial assets
Accounting policy
The carrying amount of the Company’s non-financial assets is reviewed at each reporting date to assess whether there is any indication of impairment. This indication may arise from internal factors related to the operational efficiency of the assets or from external factors related to the macroeconomic environment and to the behavior of commodity prices and of the U.S. dollar. If any such indication exists, the recoverable amount of the asset is estimated. The recoverable amount of an asset is defined as the higher of its fair value and the value in use of its cash-generating unit (“CGU”), unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets.
When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and an impairment loss is recognized to adjust the carrying amount to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and of the risks specific to the asset.
Impairment losses are recognized in profit or loss in expense categories consistent with the function of the impaired asset, when applicable. A previously recognized impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognized, except for goodwill, which cannot be reversed in future periods.
The Company performed the assessment by grouping the assets of each region into independent CGUs, which represent the smallest identifiable groups of assets that generate cash inflows that are largely independent from the cash inflows from other assets or groups of assets.
| 38 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
Critical accounting estimates and judgments
The Company determines its cash flows based on budgets approved by Management, which use the following assumptions: (i) revenue growth rate; (ii) margins applied to the cost of sales of its products; and (iii) discount rates that reflect the specific risks of each CGU. These assumptions are subject to risks and uncertainties, such as future market or economic conditions and those related to the sales of each CGU. Therefore, it is possible that changes in circumstances may alter these projections, which may affect the recoverable amount of assets.
CGUs were grouped within the North, East and South regions served by the Company.
Goodwill arising from business combinations is allocated to the CGUs that benefited from the acquisition and is tested for impairment at that level.
The Company consistently monitors whether new CGUs are identified and whether they are justifiable.
Value in use calculation in the impairment test
The value in use calculation is based on a DCF (discounted cash flow) model. Cash flows are derived from the budget for the next five years and do not include restructuring activities to which the Company is not yet committed or significant future investments that will improve the performance of the CGU being tested. The recoverable amount is sensitive to the discount rate used in the DCF model, as well as to the expectations of future cash flows and to the growth rate used for extrapolation. These estimates are the most relevant for the impairment test of the goodwill recognized by the Company.
The recoverable amount of the Company’s CGUs was determined based on a value in use calculation using cash flow projections from financial budgets approved by the Board of Directors, covering a five-year period.
As a result of the test, the recoverable amount of these CGUs was lower than their carrying amount, resulting in the recognition of an impairment loss on goodwill and fair value step-ups in the total consolidated amount of R$ 822,257 (R$ 155,364 in the Parent company), recorded in profit or loss for the year.
The reduction in recoverable amounts relative to carrying amounts and the consequent recognition of impairment losses arises from the deterioration of the Company’s economic and financial situation described in Note 1.
17. Trade payables
Accounting policy
Trade payables related to the purchase of goods for resale of agricultural inputs are financial liabilities (see Note 6) initially recognized at fair value and subsequently measured at amortized cost using the effective interest method, considering the average rate of contracts negotiated with suppliers.
|
| Consolidated | ||
|
| 2025 |
| 2024 |
|
|
|
|
|
Trade payable in local currency |
| 2,643,462 |
| 3,106,320 |
Trade payable in foreign currency |
| 301,703 |
| 301,703 |
|
|
|
|
|
Total |
| 2,945,165 |
| 3,408,023 |
Current |
| 2,945,077 |
| 3,407,431 |
Non-current |
| 88 |
| 592 |
The effective interest rate as of June 30, 2025 was 1.71% per month (1.55% as of June 30, 2024).
As mentioned in Note 1(a), negotiations with the main suppliers are in progress and, if the EJ Plan is ratified, this will bring immediate financial benefits to the Company. Of the outstanding balance as of June 30, 2025, the Company had R$ 1,107,153 past due, which is largely from creditors that have adhered to the renegotiation agreement.
Guarantees
The Company obtains guarantees from financial institutions for installment purchases of agricultural inputs from certain suppliers. These guarantees are represented by short-term bank guarantees and endorsements to the supplier of CPRs obtained from customers in the sales process. The amount of these guarantees as of June 30, 2025 was R$ 499,520 (R$ 1,082,199 as of June 30, 2024).
| 39 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
18. Borrowings
Accounting policy
Borrowings are financial liabilities initially recognized at fair value, net of transaction costs incurred, and are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the total amount payable is recognized in profit or loss over the period in which the borrowings are outstanding, using the effective interest method.
The Company’s borrowings are entered into with the objective of strengthening working capital and have repayment schedules in line with the operating cycles of each crop year. Borrowing agreements do not include financial covenants.
(a) Debt composition
|
|
|
|
|
| Consolidated |
|
| Average | 2025 |
| Average Interest Rate (i) |
| 2024 |
|
|
|
|
|
|
|
|
|
R$, indexed to CD (i) | 14.39% | 356,955 |
| 14.47% |
| 538,968 |
|
R$, with fixed interest |
| - |
| 13.71% |
| 4,989 |
|
U.S. dollars, with fixed interest | 14.24% | 90.490 |
| 8.64% |
| 103,237 |
|
|
|
|
|
|
|
|
|
Total |
| 447,445 |
|
|
| 647,194 |
|
|
|
|
|
|
|
|
|
Current |
| 447,445 |
|
|
| 647,029 |
|
Non-current |
| - |
|
|
| 165 |
|
(i) Debt denominated in Brazilian reais and bearing interest at the CDI rate (see Note 7 for the definition of these indexes), plus a spread.
To determine the average interest rate of debt contracts with floating and fixed rates, the Company used the rates in effect in the years ended June 30, 2025 and 2024.
In June 2025, the borrowing with Banco ABC in the amount of R$ 20,430 was reclassified to current liabilities due to the non-compliance with the covenant related to the out-of-court restructuring.
(b) Movement in borrowings
|
| Consolidated |
|
|
|
As of June 30, 2023 |
| 824,870 |
|
|
|
Proceeds from borrowings |
| 1,826,594 |
Repayment of principal amount |
| (2,053,445) |
Accrued interest |
| 184,290 |
Borrowings from acquired companies (i) |
| 61,793 |
Exchange rate translation |
| 11,922 |
Interest paid |
| (208,830) |
|
|
|
As of June 30, 2024 |
| 647,194 |
|
|
|
Proceeds from borrowings |
| 275,898 |
Repayment of principal amount |
| (457,986) |
Accrued interest |
| 85,502 |
Exchange rate translation |
| (2,046) |
Interest paid |
| (101,117) |
|
|
|
As of June 30, 2025 |
| 447,445 |
(i) Balances arising from business combinations (Note 22).
| 40 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(b) Schedule of maturity of non-current portion of borrowings
The installments are distributed by maturity year:
|
| 2025 |
| 2024 |
|
|
|
|
|
|
|
2025 |
| - |
| 17 |
|
2026 |
| - |
| 148 |
|
|
|
|
|
|
|
Total |
| - |
| 165 |
|
19. Agribusiness Receivables Certificates
On November 27, 2023, ECO Securitizadora de Direitos Creditórios do Agronegócio S.A. (“Issuer”) requested from the CVM the registration of a public offering for the distribution of 420,000 Agribusiness Receivables Certificates (CRA) backed by agribusiness receivables owed by Lavoro Agro Holding S.A.
(a) Composition
|
|
|
|
|
|
|
| Maturity |
| Average Interest Rate |
| 2025 |
|
|
|
|
|
|
|
|
Series I | December 22, 2027 |
| CDI + 3% |
| 68,316 |
|
Series II | December 22, 2027 |
| 14.20% (i) |
| 353,165 |
|
Transaction Cost |
|
|
|
| (10,966) |
|
Total |
|
|
|
| 410,515 |
|
|
|
|
|
|
|
|
Current |
|
|
|
| 410,515 |
|
Non-current |
|
|
|
| - |
|
(i) For the fixed-rate portion of CRA Series II, an interest-rate swap to a CDI-based rate plus spread was contracted, as described in Note 7.
(b) Movement in Agribusiness Receivables Certificates
As of June 30, 2024 |
| 405,565 |
|
|
|
Transaction Cost |
| 3,849 |
Accrued interest |
| 57,456 |
Interest payment |
| (56,355) |
As of June 30, 2025 |
| 410,515 |
(c) Covenants
This debt includes covenants related to the leverage level, requiring the maintenance of a net debt to EBITDA ratio not higher than 2.5x, to be calculated as of June 30 of each year. As of June 30, 2025, Lavoro Agro Holding S.A. was not in compliance with the covenants agreed with the financial institution, being above the 2.5x limit established in the Agribusiness Receivables Certificates (CRA).
As of June 30, 2025, the Company had not obtained the waiver related to the non-compliance with the financial covenants established in the CRA. Accordingly, in accordance with the applicable accounting standards, the outstanding balance of this debt was reclassified to current liabilities.
The Company also has loan and financing agreements that include non-financial covenants, which monitor cross-default events. For the fiscal year ended June 30, 2025, the Company identified a loan agreement with Banco ABC with such conditions and the outstanding balance was reclassified to current liabilities, as disclosed in Note 18.
| 41 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
20. Obligations to quota holders
|
| 2025 |
| 2024 | ||
|
|
|
|
| ||
Fiagro I |
| 132,359 |
| 175,520 | ||
Fiagro II |
| 272,805 |
| — | ||
Others |
| 53,166 |
| — | ||
Total |
| 458,330 |
| 175,520 | ||
On August 2, 2024, the Company entered into an agreement to transfer receivables in the total amount of R$315,000 to Lavoro Agro Fundo de Investimentos nas Cadeias Produtivas Agroindustriais (FIAGRO II), an investment fund structure organized under Brazilian law, created specifically to invest in agribusiness receivables. The proceeds from this issuance will be used to support Lavoro’s ongoing working capital needs and other general corporate purposes. This transaction represents Lavoro’s second facility, after the inaugural R$167,000 fund (FIAGRO I) established in 2022.
FIAGRO II was structured with 80% senior quotas, which bear a reference return at a rate equivalent to CDI + 3.5% per year. The remaining percentage corresponds to subordinated quotas, which bear a reference return of CDI + 100% per year. Senior quotas are amortized semiannually over a three-year period, while subordinated quotas are amortized on the maturity date.
In accordance with IFRS 10, the Company is the controlling entity of FIAGRO I and FIAGRO II and, therefore, these funds are consolidated in our consolidated financial statements. Senior and mezzanine quotas are recognized as a financial liability under the caption “Obligations to FIAGRO quota holders and others”; related remuneration paid to senior and mezzanine quota holders is recorded in finance costs.
(a) Other quota holders
During the current period, the Company entered into other agreements to transfer receivables in the total amount of R$425,000 to investment funds organized under Brazilian law, in which the Company does not hold quotas. Under these agreements, the Company did not transfer substantially all the risks and rewards of these assets and, therefore, in accordance with CPC 48 / IFRS 9 – Financial Instruments, the Group continues to recognize the receivables and recognizes the related liability under the caption “Obligations to quota holders”.
21. Payables for acquisition of subsidiaries
The purchase and sale agreements of subsidiaries include payments to the seller in the event of successful collection of open receivables after the acquisition date and in the event of a favorable outcome in administrative proceedings related to certain tax credits pending before the tax authorities. Detailed information by acquisition is presented in Note 22.
The consideration paid during the fiscal year ended June 30, 2025 totaled R$31,270, related to acquisitions carried out in prior years. The consideration paid during the year ended June 30, 2024, net of cash acquired, was R$231,950, including R$179,148 related to acquisitions carried out in prior years.
| 42 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
22. Acquisition of subsidiaries
Accounting policy
The acquisition method is used to account for each business combination entered into by the Company and consists of the following steps:
identifying the acquisition date;
identifying the acquirer and the acquiree;
determining the consideration transferred for the acquisition of control;
recognizing, separately from goodwill, the identifiable assets acquired and liabilities assumed at fair value; and
determining the residual goodwill or a gain on a bargain purchase.
The acquisition date is the date on which the Company obtains control of the business. The consideration transferred is measured at the acquisition date at the fair value of the assets transferred, including cash, liabilities incurred and equity instruments issued by the Company at the acquisition date.
For each business combination, the Company measures non-controlling interests in the acquiree at fair value or based on their proportionate interest in the acquiree’s identifiable net assets. Acquisition-related costs are recognized in profit or loss when incurred.
When the Company acquires a business, it assesses the fair value of the assets and liabilities assumed so as to allocate them in accordance with the contractual terms, economic circumstances and conditions existing at the acquisition date.
Any contingent consideration to be transferred by the acquirer is recognized at fair value at the acquisition date. Subsequent changes in the fair value of contingent consideration that is classified as an asset or a liability are recognized in accordance with CPC 48 / IFRS 9 – Financial Instruments, in profit or loss.
Goodwill or a gain on a bargain purchase is the difference between the fair value of the assets acquired and liabilities assumed and the consideration transferred. When the consideration transferred exceeds the fair value of the net assets acquired, goodwill is recognized for the difference and is subsequently tested for impairment. When the consideration transferred is lower than the fair value of the net assets acquired, a gain on a bargain purchase is recognized in profit or loss.
Intangible assets recognized as part of a business combination are accounted for in accordance with the accounting policy described in Note 15.
Critical accounting estimates and judgments
Accounting for a business combination requires the Company to exercise significant judgment in determining the fair value of the assets and liabilities of the businesses being acquired. Accordingly, the Company makes certain assumptions about uncertain future conditions, including future commodity prices, interest rates, inflation and weather conditions.
Changes in any of these assumptions may affect the Company’s businesses and the actual results may differ materially from the values estimated at the acquisition date.
The Company entered into several agreements to acquire groups of companies and expand its businesses into new markets or territories, add additional facilities, strengthen its competitive advantage or acquire and access new technologies and capabilities.
(a) Acquisitions in the fiscal year ended June 30, 2025
For the fiscal year ended June 30, 2025, the Company did not enter into new acquisitions.
| 43 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(b) Acquisitions for the year ended June 30, 2024
The fair value of identifiable assets and liabilities, consideration transferred and goodwill at the acquisition date were as follows:
| Referência Agroinsumos |
| CORAM |
| Total |
Assets |
|
|
|
|
|
Cash and cash equivalent | 8,135 |
| 15,352 |
| 23,487 |
Trade Receivables | 31,464 |
| 61,791 |
| 93,255 |
Inventories | 43,680 |
| 47,481 |
| 91,161 |
Other assets | 11,473 |
| 12,779 |
| 24,252 |
Property, plant and equipment | 1,556 |
| 1,804 |
| 3,360 |
Intangible assets | 30,494 |
| 15,003 |
| 45,497 |
| 126,802 |
| 154,210 |
| 281,012 |
|
|
|
|
|
|
Liabilities | 56,137 |
| 79,298 |
| 135,435 |
Trade Payables | 32,429 |
| 29,364 |
| 61,793 |
Borrowings | 40,757 |
| 1,263 |
| 42,020 |
Other liabilities | 4,168 |
| 10,259 |
| 14,427 |
| 133,491 |
| 120,184 |
| 253,675 |
|
|
|
|
|
|
Total identifiable net assets at fair value | (6,689) |
| 34,026 |
| 27,337 |
Non-controlling interests | 2,007 |
| - |
| 2,007 |
Goodwill arising on acquisitions | 106,794 |
| 15,847 |
| 122,641 |
Consideration transfered | 102,112 |
| 49,873 |
| 151,985 |
|
|
|
|
|
|
Cash payed | 67,112 |
| 20,000 |
| 87,112 |
Payable in installments | 35,000 |
| 29,873 |
| 64,873 |
23. Income taxes
Accounting policy
(a) Current income tax and social contribution
Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the tax authorities. The tax rates and tax laws used to compute the amount are those that are in force at the reporting date in the countries where the Company operates and generates taxable income. Current income tax relating to items recognized directly in equity is recognized in equity and not in profit or loss.
Management periodically evaluates positions taken in income tax returns with respect to situations in which applicable tax regulations are subject to interpretation and recognizes provisions where appropriate.
| 44 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(b) Current and deferred income tax and social contribution
Deferred taxes are provided using the liability method on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred tax liabilities are recognized for all taxable temporary differences, except:
when the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor the taxable profit (tax loss); and
with respect to taxable temporary differences associated with investments in subsidiaries, associates and interests in joint arrangements, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognized for all deductible temporary differences, carryforward of unused tax credits and any unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the carryforward of unused tax credits and unused tax losses can be utilized, except:
when the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor the taxable profit (tax loss); and
with respect to deductible temporary differences associated with investments in subsidiaries, deferred tax assets are recognized only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and that taxable profit will be available against which the temporary differences can be utilized.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized.
Unrecognized deferred tax assets are reassessed at each reporting date and are recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered. In assessing the recoverability of deferred tax assets, the Company relies on the same forecasting assumptions used in other financial statements and management reports.
The benefits of uncertain tax positions are recognized only after determining, based on the position of its internal and external legal advisers, that it is more likely than not that the uncertain tax positions will be sustained upon examination by the tax authorities, if any.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred taxes relate to the same taxable entity and the same taxation authority.
Critical accounting estimates and judgments
Significant judgments, estimates and assumptions are required to determine the amount of deferred income tax assets to be recognized based on the probable timing and level of future taxable profits together with future tax planning strategies.
The Company applies significant judgment in assessing the realization of deferred income tax assets by evaluating the Company’s ability to generate sufficient future taxable profits and the implementation of tax planning strategies to support the realization of existing deferred income tax assets.
| 45 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(c) Reconciliation of income tax expense
|
| Parent Company |
| Consolidated | ||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 |
|
|
|
|
|
|
|
|
|
Profit (loss) before income tax and social contribution |
| (2,649,131) |
| (39,551) |
| (2,544,364) |
| (1,571,949) |
Statutory rate |
| 34% |
| 34% |
| 34% |
| 34% |
|
|
|
|
|
|
|
|
|
Income tax at the statutory rate |
| 900,705 |
| 13,447 |
| 865,084 |
| 534,463 |
|
|
|
|
|
|
|
|
|
Share of results of subsidiaries accounted for under the equity method |
| (815,128) |
| - |
| (3,964) |
| - |
Tax losses for which no deferred tax was recognized (i) |
| (18,866) |
| (13,447) |
| (425,292) |
| (266,478) |
Temporary differences for which no deferred tax was recognized |
| (33,896) |
| - |
| (544,482) |
| - |
Tax benefit (ii) |
|
|
|
|
|
|
| 70,808 |
Write-down of deferred tax assets |
|
|
|
|
| (195,461) |
| - |
Permanent differences |
| (32,483) |
| - |
|
|
|
|
Other |
| (489) |
| - |
| 311 |
| (11,543) |
Income tax and social contribution expense |
| (156) |
| (2,224) |
| (303,804) |
| 208,331 |
Effective tax rate |
| 0.01% |
| 11% |
| 11.94% |
| 146% |
|
|
|
|
|
|
|
|
|
Current |
| (156) |
| (9) |
| (20,271) |
| 112,568 |
Deferred |
| - |
| (2,215) |
| (283,533) |
| 95,763 |
(i) This amount reflects the tax benefit arising from the deductibility of ICMS tax incentives from the income tax base, see Note 9.
The Company accumulated tax loss carryforwards and negative bases in certain subsidiaries at June 30, 2025 in the amount of R$991,823 (R$783,759 at June 30, 2024) for which no deferred income tax asset was recognized and which are available indefinitely to offset future taxable profits in the entities in which the losses were incurred. No deferred tax assets were recognized on the income related to these losses because they cannot be used to offset taxable profits between the Company’s subsidiaries and there is no other evidence of probable recoverability in the near future. In the fiscal year ended June 30, 2025, the carrying amount of deferred tax assets was reviewed and fully written down in the amount of R$283,533 to the extent that the Company’s projections did not point to future taxable profits that would indicate their recoverability in the near term.
| 46 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(d) Deferred income tax balances
|
|
|
| Consolidated |
|
| 2025 |
| 2024 |
Deferred Income Tax: |
|
|
|
|
Fair value amortization |
| 42,561 |
| 56,643 |
Tax losses |
| 201,335 |
| 203,125 |
Allowance for expected credit losses |
| 22,530 |
| 29,985 |
Adjustment to present value |
| 19,266 |
| 25,641 |
Provision for management bonuses |
| 10,808 |
| 14,384 |
Allowance for inventory losses |
| 3,181 |
| 4,233 |
Unrealized gains or losses on derivatives |
| 2,873 |
| 3,823 |
Unrealized gains or losses on commodity forward contracts |
| 8,851 |
| 11,779 |
Unrealized gains or losses on foreign exchange |
| 3,489 |
| 4,644 |
Impairment of deferred tax assets |
| (195,461) |
| - |
|
|
|
|
|
|
| 119,433 |
| 354,257 |
|
|
|
|
|
|
|
|
|
|
Deferred income tax liability: |
|
|
|
|
Fair value amortization |
| (27,491) |
| (16,039) |
Adjustment to present value |
| (31,588) |
| (18,429) |
Unrealized gains or losses on derivatives |
| (10,759) |
| (6,277) |
Unrealized gains or losses on commodity forward contracts |
| (43,788) |
| (25,547) |
Unrealized gains or losses on foreign exchange |
| (3,922) |
| (2,288) |
Other provisions |
| (1,885) |
| (2,144) |
|
| (119,433) |
| (70,724) |
|
|
|
|
|
Deferred income tax. net |
| - |
| 283,533 |
|
|
|
| Consolidated |
|
| 2025 |
| 2024 |
Deferred income tax assets |
| - |
| 289,337 |
Deferred tax liabilities |
| - |
| (5,804) |
|
| - |
| 283,533 |
(e) Deferred income taxes balances
|
| Consolidated |
|
| Deferred income tax |
|
|
|
On June 30, 2022 |
| 195,326 |
Recognized in profit or loss |
| 95,763 |
As of June 30, 2023 |
| 291,089 |
Recognized in profit or loss |
| (7,556) |
As of June 30, 2024 |
| 283,533 |
|
|
|
Reversal of temporary differences during the year |
| (88,072) |
Impairment of deferred tax assets |
| (195,461) |
As of June 30, 2025 |
| - |
| 47 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
24. Provisions for contingencies
Provisions are recognized when the Company has a present obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of the amount. Provisions are reviewed and adjusted to reflect Management’s best estimate at the reporting dates.
When there is a number of similar obligations, the probability of an outflow is assessed for the class of obligations as a whole.
Provisions are measured at the present value of the expenditures expected to be required to settle the obligation, using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation.
(a) Probable Losses
The consolidated balance of provisions for probable civil, tax and labor contingencies recognized by the Company amounted to R$11,004 and R$4,134 as of June 30, 2025 and June 30, 2024, respectively.
(b) Possible Losses
The Company is a party to several proceedings involving tax, environmental and civil matters which, based on the assessment made by Management, with the assistance of its legal advisors, were classified as possible losses. Possible losses totaled R$268,953 and R$147,837 on a consolidated basis as of June 30, 2025 and 2024, respectively. For the Parent company, there were no possible losses in either period.
25. Advances from customers
Customer advances are the result of the "cash sale" modality, in which rural producers anticipate payment to the Company at the beginning of the harvest, before the invoicing of agricultural inputs. These advances are settled in the short term.
| Consolidated | ||
| 2025 |
| 2024 |
|
|
|
|
Opening balance | 233,373 |
| 478,313 |
|
|
|
|
Revenue recognized that was included in the contract liability balance at the beginning of the year | (589,050) |
| (671,788) |
Increase in advances | 443,587 |
| 386,090 |
Advances from acquired companies | - |
| 40,758 |
|
|
|
|
Ending balance | 87,910 |
| 233,373 |
| 48 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
26. Related parties
(a) Parent Company
The transactions with related parties of Lavoro Agro Holding S.A. are described below:
(1) Breakdown of assets and liabilities
|
| Parent Company | ||
|
| 2025 |
| 2024 |
|
|
|
|
|
Assets |
|
|
|
|
Related parties |
| 575,407 |
| 415,918 |
Total |
| 575,407 |
| 415,918 |
|
|
|
|
|
Liabilities |
|
|
|
|
Related parties |
| 442,914 |
| 319,083 |
Payables for acquisition of subsidiaries |
| 6,827 |
| 6,827 |
Total |
| 449,741 |
| 325,910 |
(2) Statements of profit or loss
| ||||
|
| 2025 |
| 2024 |
|
|
|
|
|
Expenses for acquisitions of subsidiaries and monitoring |
| (6,657) |
| (24,084) |
Allocation of administrative expenses (i) |
| 149,033 |
| 137,285 |
Finance income (costs) on borrowing agreements (ii) |
| 39,934 |
| 10,135 |
Total |
| 182,309 |
| 123,336 |
|
|
|
|
|
(i) The Parent company’s administrative expenses are allocated to the subsidiaries based on an expense-sharing agreement and are presented net within general and administrative expenses.
(ii) Refer to loan agreements with subsidiaries and to outstanding balances of expense allocations. Loan agreements bear interest, on average, at CDI + 3.5% to 5.54% per year.
(b) Consolidated
The Company’s related parties in the consolidated information that have balances receivable, payable or other balances are: (i) non-controlling shareholders, (ii) Patria Investments Limited, which manages the funds that control the Company, (iii) key management personnel, (iv) Lavoro Limited and other offshore holdings, (v) entities indirectly controlled by Lavoro Limited and (vi) entities indirectly controlled by Patria Investments.
| 49 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(1) Breakdown of assets and liabilities
|
| Consolidated | ||
|
| 2025 |
| 2024 |
|
|
|
|
|
Assets |
|
|
|
|
Trade Receivables (i) |
| 1,656 |
| 7,713 |
Borrowing agreements receivable (ii) |
| 211,804 |
| 149,981 |
Advances to suppliers (i) |
| 7,185 |
| 28 |
|
|
|
|
|
Total |
| 220,646 |
| 157,722 |
|
|
|
|
|
Liabilities |
|
|
|
|
Trade payables (i) |
| 2,014 |
| 2,793 |
Related parties (ii) |
| 313,687 |
| 459,909 |
Payables for acquisition of subsidiaries (iii) |
| 137,034 |
| 181,960 |
Advances from customers (i) |
| 21,012 |
| 1,046 |
Total |
| 473,747 |
| 645,708 |
|
|
|
|
|
(i) Refer to commercial transactions in the ordinary course of business with non-controlling shareholders of subsidiaries and other related parties of the Lavoro Limited Group. Such transactions are carried out under the same commercial conditions applicable to customers or suppliers that are not related parties.
(ii) Borrowing agreements with other related parties of the Lavoro Limited Group, bearing interest, on average, at CDI + 3.5% to 5.54% per year.
(iii) Installments payable to non-controlling shareholders related to the business combinations described in Note 22.
(2) Statements of profit or loss
During the fiscal year ended June 30, 2025, the Company carried out significant transactions with related parties controlled by funds managed by Pátria Investments involving the purchase of agricultural inputs at market prices plus a fixed margin for the term of the transaction, commercial advances and assignments, without recourse, of trade receivables from rural producers, in order to ensure the continuity of the supply of agricultural inputs to customers during the period of restructuring of the Company’s capital structure and adherence to the out-of-court reorganization plan. A summary of these transactions is presented below:
|
|
| Consolidated | ||
|
|
| 2025 |
| 2024 |
|
|
|
|
|
|
Revenue from sales of products(i) |
|
| 23,966 |
| 22,904 |
Cost of goods sold (i) |
|
| (291,467) |
| (34,903) |
Monitoring expenses and expenses related to acquisitions of subsidiaries (ii) |
|
| (6,657) |
| (24,048) |
Other administrative expenses |
|
| (355) |
| (2,435) |
Finance income (costs) on borrowings agreements |
|
| 9,925 |
| 5,015 |
Interest on payables for acquisitions |
|
| (1,350) |
| (8,988) |
Net loss on write-off of assigned receivables (iv) |
|
| (88,179) |
| - |
Finance expenses (iii) |
|
| (71,600) |
| - |
Financing cash flows (iii) |
|
| 235,930 |
| - |
Non-cash transactions |
|
|
|
|
|
Assignments of receivables without recourse (Note 32) |
|
| 743,400 |
| - |
(i) Refers to business transactions in the normal course of business with non-controlling shareholders of subsidiaries and other related parties.
(ii) Expenses related to support services in connection with acquisition transactions.
(iii) Transactions with entities controlled by Patria Investments, involving purchases of inputs on credit, advances and assignment of receivables without recourse.
(iv) Loss recognized on the assignment of receivables with related parties, net of the reversal of expected credit losses, as described in Notes 5 and 29.
| 50 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
(3) Key management personnel compensation
|
| Parent and Consolidated | ||
|
| 2025 |
| 2024 |
|
|
|
|
|
Wages |
| 7,934 |
| 13,860 |
Direct and indirect benefits |
| 707 |
| 704 |
Variable compensation (bonuses) |
| 4,501 |
| 12,391 |
Short-term benefits |
| 13,142 |
| 26,955 |
|
|
|
|
|
Share-based payment benefits |
| 6,415 |
| 9,486 |
Total |
| 19,557 |
| 36,441 |
The amounts above include payments to the Company’s board of directors and the executive officers.
27. Equity
(a) Share capital
The Company’s fully subscribed and paid-in share capital as of June 30, 2025 amounted to R$1,457,186, represented by 1,457,186,000 common shares.
The Company’s shareholding structure for the periods ended June 30, 2025 and 2024 is as follows:
|
| 2025 |
| 2024 | ||
| Note | Shares | % |
| Shares | % |
Malinas S.A. | 27(d) | 1,457,186,000 | 100 |
| 1,350,566,000 | 100 |
|
| 1,457,186,000 | 100 |
| 1,350,566,000 | 100 |
During the year ended June 30, 2025, the authorized capital was increased by R$106,619 through the capitalization of amounts received as advances for future capital increase (AFAC).
(b) Share-based payment
Accounting policy for share-based payment – Equity-settled transactions
The cost of equity-settled transactions is measured at fair value on the grant date using an appropriate valuation model. This cost is recognized in personnel expenses (Note 29), together with a corresponding increase in equity (other capital reserves), over the period in which the performance conditions are fulfilled (the vesting period). The cumulative expense is recognized for equity-settled transactions at each reporting date until the vesting date, reflecting the extent to which the vesting period has expired and the Company’s best estimate of the number of equity instruments that will ultimately vest.
Service conditions are not taken into account when determining the fair value at the grant date, but the probability of meeting those conditions is assessed as part of the Company’s best estimate of the number of equity instruments that will ultimately vest. Market performance conditions are reflected in the fair value at the grant date. Other conditions attached to an award, but with no associated service requirement, are treated as non-vesting conditions.
No expense is recognized for awards that do not vest when neither the market performance conditions nor the service conditions have been met. When awards include a market or non-vesting condition, the transactions are treated as vested, irrespective of whether the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are met.
| 51 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
When the terms of an equity-settled award are modified, the minimum expense recognized is the fair value at the grant date of the award before the modification, provided that the original vesting conditions are satisfied. An additional expense, measured at the modification date, is recognized for any modification that increases the total fair value of the share-based payment transaction or is otherwise beneficial to the employee. When an award is cancelled by the entity or by the counterparty, any remaining element of the fair value of the award is immediately recognized in profit or loss.
On August 17, 2022, the Company approved the Lavoro Agro Holding S.A. Long-term Incentive Policy (the “Lavoro Share-based payment Plan” or “Plan”). Under the Plan, individuals selected by the Company’s Board of Directors (“Selected Employees”) are eligible to receive compensation consisting of cash, assets or share options issued by Lavoro Agro Limited, in an amount linked to the appreciation of Lavoro Agro Limited’s share price on the liquidity event date, subject to the fulfillment of certain conditions, as described below.
On June 30, 2023, the Company granted 42,268,748 share options as incentive compensation to Selected Employees. The share options granted under the Plan will vest if the following market conditions (“Market Conditions”) are met:
(i) the occurrence of a liquidity event that meets a minimum internal rate of return specified in the Plan; and
(ii) the per-share price obtained in such liquidity event must be greater than or equal to one of the following amounts:
a) a pre-established reference price multiplied by three; or
b) an amount calculated in accordance with a pre-established formula, in each case as specified in the Plan.
In addition, after the Market Conditions have been met, such share options will vest according to the following schedule (the “Service Conditions”):
(i) one-third of the options vests on the third anniversary of the grant date;
(ii) one-third of the options vests on the fourth anniversary of the grant date; and
(iii) one-third of the options vests on the fifth anniversary of the grant date.
The Plan has a five-year term: if the Market Conditions are not satisfied within this period, all options granted under the Plan will be forfeited, with no further payment or incentive obligation by the Company.
On February 28, 2023, the shareholders of the parent company Lavoro Limited approved the Plan and, as a result, the Company reserved for issuance the number of ordinary shares equal to the number of shares under the Plan, an amount of 1,663,405 ordinary shares.
The exercise price of the share-based payment equals the option price agreed with the employee in the contracts, representing R$1 adjusted up to the date on which the liquidity event occurs.
The fair value of the share options granted is estimated on the grant date, considering the terms and conditions, using the Black-Scholes model, taking into account the terms and conditions under which the share options were granted. The model also considers historical and expected dividends and the volatility of Lavoro’s share price.
On May 26, 2023, the Board of Directors of the parent company Lavoro Limited approved a long-term incentive plan (the “New Plan”) under which eligible participants, including employees of the Company, may be members of our management, our employees and our directors. Beneficiaries under the New Plan will receive equity awards in accordance with the terms and conditions of the New Plan and any applicable award agreement.
| 52 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
The expense recognized during the year and the number of options granted are shown in the tables below:
|
| Other capital reserves |
|
|
|
As of June 30, 2023 |
| 12,505 |
|
|
|
Share-based payments expense during the year |
| (522) |
|
|
|
As of June 30, 2024 |
| 11,983 |
Share-based payments expense during the year |
| 1,218 |
|
|
|
As of June 30, 2025 |
| 13,201 |
|
| Options outstanding |
|
|
|
As of June 30, 2023 |
| 42,268,748 |
|
|
|
Forfeited options |
| (4,400,022) |
|
|
|
As of June 30, 2024 |
| 37,868,726 |
|
|
|
Forfeited options |
| (1,475,000) |
|
|
|
As of June 30, 2025 |
| 36,393,726 |
The weighted average fair value of the options granted during the period was R$0.40 per option. Significant data included in the model were: weighted average share price of R$2.88 at the grant date, exercise price as presented above, volatility of 33.88%, no dividend yield, expected option life of 3.37 years and a risk-free annual interest rate of 12.45%.
(c) Restricted Stock Unit Plan ("RSU Plan")
On May 26, 2023, the Board of Directors approved a long-term incentive plan (“Restricted Stock Unit Plan” or “RSU Plan”), under which beneficiaries may receive grants of equity instruments, in accordance with the terms and conditions set forth in the plan and in the respective grant agreements. Each restricted stock unit (“RSU”), once all the conditions under the plan are met, will entitle the participant to receive, at no cost, one share issued by the ultimate parent Lavoro Agro Limited.
The total number of shares that may be delivered to participants under the plan shall not exceed five percent of the total number of shares representing the Group’s share capital.
On August 16, 2023 and September 28, 2023 (grant dates), Lavoro’s Board of Directors (the “Board”) approved the implementation of the RSU Plan, providing for the grant of restricted stock units to the participants designated by the Board.
The RSUs will vest according to the following schedule, unless otherwise approved by the Board of Directors:
(i) one-third of the units will vest on the third anniversary of the grant date;
(ii) one-third of the units will vest on the fourth anniversary of the grant date; and
(iii) one-third of the units will vest on the fifth anniversary of the grant date.
| 53 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
In the event of the participant’s termination, all RSUs not yet vested at the termination date will be automatically cancelled, with no right to compensation.
The fair value of the shares granted was measured based on Lavoro’s market share price at the grant date.
As of June 30, 2025, the number of RSUs granted is presented in the table below:
|
| RSUs outstanding |
|
|
|
As of June 30, 2023 |
| - |
|
|
|
Granted Options |
| 1,370,528 |
Forfeited Options |
| (141,411) |
|
|
|
As of June 30, 2024 |
| 1,229,117 |
|
|
|
Granted Options |
| 231,420 |
Forfeited Options |
| (62,010) |
|
|
|
As of June 30, 2025 |
| 1,398,527 |
The weighted average fair value of the shares granted was R$27.65 per share.
The expense recognized for employee services rendered during the year was R$21,409.
28. Revenue from contracts with customers
Accounting policy
Revenue from contracts with customers is recognized when control of the goods or services is transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.
Sales revenue is recognized at the point in time when control of the product is transferred to the customer, either upon delivery to the farm or pickup at the stores, and includes crop protection products, fertilizers, seeds, specialty inputs and grains arising from Barter transactions (Note 10). The Company engages third parties to provide freight services.
The Company generally acts as principal, as it is responsible for delivering the contracted goods, assumes inventory risk and has discretion in establishing the price.
Revenue from contracts with customers is recognized at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods. For sales of grains, see Note 10.
Sales prices are substantially based on international benchmark market prices, which are variable and subject to global supply and demand and other market factors. There are no general guarantees to customers. Any returns and incentives are estimated based on historical and forecast data, contractual terms and current conditions. Transportation costs are generally recovered from the customer through the sales price and are included in cost of goods sold.
Trade receivables from customers generally include a significant financing component. Accordingly, the transaction price is discounted, using the interest rate implicit in the contract (i.e., the interest rate that discounts the amount receivable from the customer to the cash selling price) and revenue is recognized at that amount. A significant portion of the financing is recognized as finance income under the amortized cost method. The average monthly interest rate applied was 1.12% for June 2025 and 0.90% for June 2024.
| 54 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
| ||||
|
|
|
| Consolidated |
|
| 2025 |
| 2024 |
|
|
|
|
|
Revenue from retail of agricultural inputs |
| 5,006,887 |
| 8,163,406 |
Revenue from the sale of grains |
| 579,748 |
| 1,024,112 |
Service revenue |
| 3,485 |
| 448 |
Returns and rebates on inputs |
| (647,009) |
| (1,163,218) |
Returns and rebates on grains |
| (17,527) |
| (10,800) |
Taxes on revenue |
| (64,519) |
| (77,228) |
Total |
| 4,861,065 |
| 7,936,720 |
Non-cash consideration
As explained in Note 10, the Company receives grains from certain customers in exchange for the product sold through Barter transactions. The fair value of such non-cash consideration received from the customer is included in the transaction price and measured when the Company obtains control of the grains.
The Company estimates the fair value of the non-cash consideration by reference to its market price.
29. Costs and expenses by nature
Accounting policy
(a) Cost of goods sold
The cost of goods sold comprises the cost of purchases, net of rebates, discounts and commercial agreements received from suppliers, changes in inventories and logistics costs (inbound and outbound). The cost of goods sold includes the cost of logistics operations managed or outsourced by the Company, including storage, handling and freight costs incurred until the goods are ready to be sold.
Trade payables to suppliers include a significant financing component. Accordingly, trade payables are discounted using the interest rate implicit in the contract (i.e., the interest rate that discounts the trade payable to the cash purchase price) and inventory is recorded at that amount. A significant financing component is recognized as finance cost under the amortized cost method. The average monthly interest rate applied was 1.71% per month for June 2025 and 1.55% per month for June 2024.
(b) Sales, general, and administrative expenses
Sales, general and administrative expenses refer to indirect expenses and to the cost of the corporate departments, information technology, treasury function, sales force personnel and marketing and advertising expenses.
| 55 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
The breakdown of costs and expenses by nature is as follows:
|
| Parent Company |
| Consolidated | ||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 |
|
|
|
|
|
|
|
|
|
Cost of inputs purchased for retail (i) |
| - |
| - |
| (3,791,173) |
| (6,003,603) |
Cost of grains |
| - |
| - |
| (562,036) |
| (949,552) |
Personnel expenses, charges and benefits |
| (98,581) |
| (65,286) |
| (412,904) |
| (382,471) |
Maintenance |
| (18,766) |
| (16,646) |
| (40,758) |
| (40,655) |
Consulting and professional services |
| (39,474) |
| (45,098) |
| (73,353) |
| (46,594) |
Freight and carriage |
| - |
| - |
| (49,956) |
| (69,802) |
Commissions |
| - |
| - |
| (50,910) |
| (58,366) |
Storage |
| - |
| - |
| (6,322) |
| (14,431) |
Travel |
| (1,777) |
| (3,165) |
| (11,538) |
| (15,354) |
Depreciation |
| (2,448) |
| (1,309) |
| (14,239) |
| (12,536) |
Amortization of intangibles |
| (18,005) |
| (19,725) |
| (52,940) |
| (66,260) |
Amortization of right-of-use assets |
| (2,282) |
| (2,290) |
| (62,604) |
| (70,059) |
Impairment losses on assets |
| (155,364) |
| - |
| (822,257) |
| - |
Taxes and fees |
| (141) |
| (144) |
| (5,308) |
| (5,592) |
Rentals |
| (376) |
| (361) |
| (12,393) |
| (7,663) |
Business events |
| (670) |
| (423) |
| (1,493) |
| (816) |
Marketing and advertising |
| (580) |
| (1,502) |
| (6,500) |
| (11,449) |
Insurance |
| (309) |
| (129) |
| (7,411) |
| (5,162) |
Utilities |
| (316) |
| (341) |
| (8,722) |
| (9,426) |
Allowance for credit losses |
| - |
| - |
| (321,022) |
| - |
Loss on write-off of assigned receivables (ii) |
| - |
| - |
| (249,144) |
| (60,779) |
Reversal of expected credit losses |
| - |
| - |
| 105,901 |
| - |
Inventory losses and damages |
| - |
|
|
| (78,943) |
| (44,932) |
Fuels and lubricants |
| (17) |
| (34) |
| (22,368) |
| (25,022) |
Legal fees |
| (5,358) |
| (5,358) |
| (5,358) |
| (7,532) |
Other administrative expenses (iii) |
| 104,910 |
| 135,575 |
| (39,025) |
| (41,022) |
Total |
| (239,554) |
| (26,236) |
| (6,603,046) |
| (7,949,078) |
|
|
|
|
|
|
|
|
|
Classified as: |
|
|
|
|
|
|
|
|
Cost of goods sold |
| - |
| - |
| (4,403,165) |
| (7,022,957) |
General and administrative expenses |
| (239,554) |
| (26,236) |
| (2,199,881) |
| (926,121) |
|
|
|
|
|
|
|
|
|
(i) Includes fair value on inventory sold from acquired companies, in the amount of R$475, respectively, for the year ended June 30, 2024.
(ii) Includes the amount of R$194,080 of losses on assignments of receivables with related parties mentioned in Note 26.
(iii) Corresponds to the reimbursement of administrative expenses allocated to subsidiaries, recognized as revenue in the parent company.
| 56 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
30. Other operating income and expenses
|
|
| Parent Company |
|
|
| Consolidated |
| 2025 |
| 2024 |
| 2025 |
| 2024 |
PIS/COFINS Extemporaneous Credit | 115 |
| - |
| 16,326 |
| 24,959 |
Net gain on sale of fixed assets |
|
| - |
| 1,242 |
| 2,803 |
Purchase price adjustments on acquisitions |
|
| 6,305 |
| - |
| 18,569 |
Other operating income (expenses) | 5 |
| 5,146 |
| (1,251) |
| 2,134 |
Total other operating income (expenses) | 120 |
| 11,451 |
| 16,317 |
| 48,465 |
31. Finance income (costs)
|
|
|
|
|
|
|
| ||
|
| Parent Company |
|
| Consolidated | ||||
|
| 2025 |
| 2024 |
|
| 2025 |
| 2024 |
|
|
|
|
|
|
|
|
|
|
Interest from cash equivalents |
| 1,751 |
| (144) |
|
| 17,518 |
| 9,946 |
Interest arising from revenue contracts |
| - |
| - |
|
| 277,084 |
| 359,530 |
SELIC Adjustment - Extemporaneous credit |
| - |
| - |
|
| 2,295 |
| 18,902 |
Pass-through of CRA financial charges from subsidiaries |
| 49,240 |
| - |
|
| - |
| - |
Other |
| 15,062 |
| 40,270 |
|
| 40,565 |
| 5,580 |
Finance income |
| 66,053 |
| 40,126 |
|
| 337,463 |
| 393,958 |
|
|
|
|
|
|
|
|
|
|
Interest on borrowings |
| (564) |
| - |
|
| (86,201) |
| (184,290) |
Interest on Agricultural Receivables Certificates (CRA) |
| (57,521) |
| (28,535) |
|
| (58,623) |
| (28,535) |
Interest on payables for the acquisition of subsidiaries |
| - |
| (2,023) |
|
| (3,599) |
| (13,018) |
Interest on assignments of receivables |
| - |
| (235) |
|
| (126,482) |
| (73,513) |
Interest on leases |
| (527) |
| (460) |
|
| (11,849) |
| (15,824) |
Interest on trade payables |
| (1,440) |
| (126) |
|
| (589,541) |
| (667,072) |
Interest on related-party transactions |
| (40,141) |
| (28,515) |
|
| (71,600) |
| - |
Other |
| (7,278) |
| (3,104) |
|
| (89,426) |
| (56,705) |
Finance costs |
| (107,471) |
| (62,998) |
|
| (1,037,321) |
| (1,038,957) |
|
|
|
|
|
|
|
|
|
|
Loss on fair value of commodity forward contracts |
| - |
| - |
|
| (93,793) |
| (108,748) |
Gain on changes in fair value of Derivative financial instruments |
| (11,209) |
| (1,911) |
|
| (38,429) |
| 27,105 |
Foreign exchange differences on cash and cash equivalents |
| (305) |
| - |
|
| (1,168) |
| 6,238 |
Foreign exchange differences on trade receivables and trade payables, net: |
| (3) |
| 16 |
|
| 217 |
| (27,619) |
Foreign exchange differences on borrowings |
| - |
| - |
|
| 2,056 |
| (11,948) |
Other finance costs |
| (11,517) |
| (1,895) |
|
| (131,117) |
| (114,972) |
|
|
|
|
|
|
|
|
|
|
Finance income (costs), net |
| (52,935) |
| (24,767) |
|
| (830,975) |
| (759,971) |
32. Non-cash transactions
The Company engages in non-cash transactions which are not reflected in the statement of cash flows. The main non-cash transactions are related to the following:
| 57 |
Lavoro Agro Holding S.A. Notes to the separate and consolidated financial statements (In thousands of reais (R$), except where otherwise indicated) |
|
| |
|
|
Increase in non-controlling interests
Increase in non-controlling interests through the issuance of shares, as described in Note 22, and transactions with related parties, as described in Note 26.
Assignment of receivables
The non-cash transactions refer to the assignment of the Company’s receivables for the settlement of payables related to the acquisition of inputs from related parties controlled by funds managed by Pátria Investments, in the amount of R$743,400, with a loss in the amount of R$88,179, as described in Note 26.
Other transactions
The Company also had non-cash additions of right-of-use assets and lease liabilities of R$6,216 in 2025 (R$102,668 in 2024).
33. Subsequent events
(a) Update of the Out-of-court Reorganization Plan (“EJ Plan”)
On September 9, 2025, Lavoro Brasil disclosed that it successfully obtained the required majority support from supplier creditors for court ratification to proceed, increasing the approval and adhesion quorum from 37.34% to 52.21%. The court ratification process remains ongoing as of the date of filing these financial statements. in progress up to the date of approval of these financial statements.
(b) Transactions with related parties
After June 30, 2025, Lavoro carried out a new transaction related to the acquisition of inputs from related parties controlled by funds managed by Pátria Investments in the amount of R$165 million.
(c) Waiver – Agribusiness Receivables Certificates (CRA)
On July 30, 2025, a meeting was held by the CRA holders in which the waiver of the right to declare the early maturity of the Commercial Notes and, consequently, of the CRA itself due to the breach of certain financial covenants, as described in Note 20, was approved.
As consideration, Lavoro agreed to deposit into a pledged account an amount equal to four monthly remuneration installments, as provided for in the Issuance Deed. This amount shall be used monthly to settle the obligations falling due and, until the final maturity date or an eventual early settlement, an amount equivalent to one monthly remuneration installment shall be maintained in such account.
In addition, from October 2025, and every six months thereafter, Lavoro undertakes to make a new deposit equivalent to 6 monthly remuneration installments, to be used to settle future obligations.
As a result of the granting of the waiver, the outstanding balance of this debt was reclassified to non-current liabilities from July 2025.
| 58 |