Braskem rises and leads Ibovespa amid agreement on Maceo and operational progress | finance

Good surprises in Braskem’s results led BB Investimentos to raise its sell recommendation to neutral. Analyst Daniel Cobucci wrote that the results were negative, but better than expected, with the cash burn and high leverage scenario continuing.

The main positive development during the quarter was an agreement worth R$1.2 billion with the state of Alagoas, ensuring the full settlement of the damages caused by the Maceió geological event and ending the compensation claim brought by the state.

“It is noteworthy that the presence of Alagoas commitments hampered attempts to sell to Novonor, as such an agreement increased the chances of progress on these corporate issues, which would allow greater flexibility in contributions necessary to promote the change of raw materials and achieve greater competitiveness,” the BB report said.

Braskem’s Director of Financial and Investor Relations, Felipe Jens, spoke about the agreement during a conference call with analysts on Tuesday. “Regardless of the outcome, it is progress,” he said, highlighting that allocations of amounts for expenses with the event fell from R$5.6 billion at the end of 2024 to R$3.8 billion in the third quarter of this year.

“We are working to reduce the degree of uncertainty around this topic,” Jens stated. The agreement stipulates that compensation will be paid within ten years, in annual installments, and its value will be higher from 2030 onwards.

The BB Investimentos report highlights that the company achieved recurring earnings before interest, taxes, depreciation and amortization (EBITDA) of US$150 million, which beat estimates. Although it represents a 104% increase compared to the second quarter, which was very weak, the number is still 65% lower than the previous year.

The main focus of concern in the banks’ opinion is the company’s financial deterioration, as there was a cash burn of R$334 million, with interest payments and investors being the main critics. Braskem’s net debt rose to $7.1 billion. This, combined with lower EBITDA over the past 12 months, has seen leverage rise from 10.6x to 14.8x.

UBS BB, which has a Buy recommendation on Braskem shares, also highlights that cash burn, in the first nine months of 2025, has already reached US$1.1 billion. However, analysts point out that the $1 million profit exceeded loss estimates in the period.

“Overall, these factors remain preconditions for a return to cash generation in the near future. While progress is starting to be achieved, we still see a path forward that may face significant volatility and uncertainty,” analysts led by Tasso Vasconcelos wrote.

Analysts Regis Cardoso and Joao Rodriguez of XP, who have a Neutral recommendation on the stock, estimate that Braskem’s weak results reflect a downward cycle in the petrochemical sector. In this case, the stronger outcome in Brazil compensated for the weakness of international processes, from a mediation point of view.

“As we expected, international petrochemical spreads (distance between prices) continued to decline, again negatively impacting Braskem’s results. In Brazil, resin spreads fell by 8% in the quarter, affected by broad-based declines. Key chemicals spreads also fell by 4% in the quarter. The average spread in the USA and Europe fell by 4% in the quarter, while the polyethylene spread in Mexico remained practically stable (up 1% in quarter), the report from the broker analyzes.

Citi confirms the view that there is a “difficult” scenario in the petrochemical industry. The bank stated in its report that this period was particularly difficult for Braskem’s international operations, with negative profitability in the United States, Mexico and Europe.