Quarterly Results Report 4Q24/2024

QUARTERLY

RESULTS

4Q24 | 2024

Consolidated Financial Results

1. Cost of Goods Sold: 4Q24: Inventory impairment arising from the exit from Electric Showers and Faucets (+) R$11,129k, Operational Restructuring
   (+) R$26,323k; 3Q24: Inventory impairment arising from the exit from Electric Showers and Faucets (+) R$48,922k, Operational Restructuring (+)
   R$14,333k; 2Q24: Operational Restructuring (+) R$10,302k, Other (+) R$2,601k; 1Q24: Operational Restructuring (+) R$5,257k; 2Q23: Operational
   Restructuring: (+) R$28,150k. 3Q23: Tiles Restructuring: (+) R$22,849k; Deca Restructuring: (+) R$24,111k; Closure Manizales (+) R$2,180k; DNA Restructuring (+) R$21,964k
2. EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization): measure of operating performance in accordance with CVM instruction 156/22.
3. Events of an extraordinary nature detailed in the attachment to this material.
4. Pro Forma Adjusted and Recurring EBITDA also includes Dexco's portion of the Recurring EBITDA arising from LD Celulose;
5. Current liquidity: Current assets divided by current liabilities. Indicates the amount available in R$ to cover each R$ of short-term obligations.
6. Net Corporate Debt: Total Financial Debt (-) Cash.
7. Financial leverage calculated on the rolling EBITDA over the last 12 months, adjusted for events of a purely accounting and non-cash nature.
8. ROE (Return on Equity): measure of performance obtained by taking the annualized Net Earnings over the period, annualized, and dividing by Average Net Equity.
9. Net earnings per share is calculated by dividing the earnings attributable to the company's shareholders by the average weighted number of ordinary shares issued during the period, excluding the ordinary shares held by the Treasury.

Message from the CEO

We have reached a milestone in Dexco's journey. This is the last earnings report I present as CEO. Over the years, our company has undergone a profound transformation, establishing itself as a benchmark in the industry. Looking back at everything we have built together fills me with pride: we tackled challenges head-on, innovated, grew, and, above all, remained committed to delivering the best solutions to the market.

Dexco's evolution in recent years has been driven by structural shifts that redefined the way we operate. We have expanded our portfolio, incorporated new technologies, reinforced sustainability as a core pillar, and strengthened our connection with consumers. Every step of this journey has been guided by a long- term vision and the dedication of an exceptional team that works tirelessly to make this company stronger and better prepared for the future.

The legacy I leave behind goes beyond numbers and investments - it is reflected in the culture we have built, the resilience with which we have overcome challenges, and the adaptability that has brought us this far. Dexco is now much more than a collection of brands and products; it is an agile, innovative ecosystem, fully attuned to the demands of an ever-changing world.

I am deeply grateful to everyone who has been part of this journey, especially our shareholders, for their trust since 2013, and our employees, who have believed in Dexco's potential and, with dedication and talent, have helped shape what we are today. I leave with the certainty that we are on the right path, with a solid foundation for even greater growth and success. We will continue to evolve, staying committed to innovation, sustainability, and excellence, always guided by our purpose of transforming lives and delivering Solutions for Better Living.

Market Scenario

The end of 2024 saw a challenging economic scenario, characterized by moderate growth and uncertainties with respect to 2025. The Institute of Applied Economic Research (Ipea) made an upward revision to its GDP projection for the year, but the combination of official inflation at 4.83% - above the target set by the Central Bank - and the rise in the dollar, which reached its highest level on record, increased pressures on both consumption and the costs of production. For the construction sector, which reported growth of 4.1% for 2024, the effect of a more restrictive monetary policy and a rise in the cost of materials (with inflation in the sector ending the year at 3.98%, according to IBGE) brought additional challenges, which impacted both the wider economy and Dexco's results.

The panels sector ended the year positively, with strong demand throughout the period. According to data from the IBÁ (the Brazilian Tree Industry), sales were 10.2% higher for 4Q24 than for the same period the previous year. For the full year, sector growth hit 18.5%. This strong performance was reflected in the results of Dexco's Wood Division, which closed out 4Q24 with an Adjusted and Recurring EBITDA of R$349.7 million, giving a full year total of R$1,514.4 million, with margins of 26.4% and 28.3%, respectively.

Highlighting its operating efficiency and diligent cost management, LD Celulose ended 2024 reporting record results. Adjusted and Recurring EBITDA hit R$1.616,2 million for the full year, with a margin of 54.8%, and R$565.9 million for the quarter, with a margin of 59.5%, considering 100% of the operation.

Industry groups that monitor the performance of the construction industry pointed to positive signs of a recovery in 2024, despite a drop off in the last quarter. ABRAMAT (the Brazilian Association for the Construction Materials Industry), for example, reported full year growth in deflated revenue in both the basic segment (4.0%) and finished segment (8.6%). ANFACER (National Association of Ceramic Coating Manufacturers) reported sales volumes 4.0% up on 2023.

For Dexco, the Finishes segment cemented its positive performance versus 2023, driven by improvements in operational efficiency. However, in addition to the usual seasonality seen during the period, which impacts volumes, the Company traditionally carries out scheduled maintenance shutdowns at the end of the year, to fit in with the industry's collective vacation period, with a consequent impact on Q4 results.

Thus, for the Metals and Sanitary Ware Division, Adjusted and Recurring EBITDA for the year was R$131.9 million, with a margin of 6.6%. For 4Q24, the result was R$28.9 million, with a margin of 5.6%. The rise in the value of the dollar impacted the cost of imported inputs and materials, which put pressure on the numbers for the period. Excluding this factor, the division maintained a performance similar to that seen for the other quarters of the year, confirming its trajectory of recovery. The Tiles Division closed out 2024 with an Adjusted and Recurring EBITDA of R$4.0 million and margins of 0.5%, with negative results and margins for the quarter. This performance was influenced both by the factors previously mentioned and by a drop-offin demand for the wet process segment during the period, which ended the year with a fall of 0.4% versus 2023.

After a year full of both challenges and opportunities, Dexco remains attentive to market movements and the factors that influence the sector. Although the outlook for 2025 continues to present uncertainties, the Company remains committed to operational efficiency and the strategic management of its business. Also, the conclusion of the 2021-2025 Investment Cycle has consolidated an important foundation for maintaining competitiveness and mitigating economic and market pressures. Thus, aligned to the dynamics of the sector while taking proactive steps, Dexco remains focused on generating value and sustainable results in 2025.

Financial Headlines

Net Revenue

Consolidated Net Revenue for 4Q24 was R$2,064.2 million, an increase of 5.9% over 4Q23. This growth was mainly driven by the performance of the Metals and Sanitary Ware Division, which benefited from a richer product mix, and from operational gains during the year. In addition, demand for panels in the Wood Division remained strong, contributing positively to the result.

Versus 3Q24, Net Revenue saw a drop-off of 7.8%, reflecting the retraction in sales volumes across all Divisions. This dip reflects the seasonal nature of the period, coming as it does with collective vacations in the industry, scheduled maintenance shutdowns, and a reduced number of business days given the end-of-year festivities.

In addition, the macroeconomic scenario at the end of the year brought additional challenges, with a worsening of indicators such as inflation and the exchange rate. This impacted market expectations with respect to the sustainability of demand, while the increase in international freight costs hit revenues arising from the overseas market.

For the full year 2024, Net Revenue was R$8.234.6 million, an increase of 11.5% versus 2023. This increase was mainly driven by operational improvements in the Metals and Sanitary Ware Division and a richer product mix. In addition, the Wood Division's results were boosted by forestry transactions carried out in 1Q24 and 3Q24 and a solid performance in panels sales.

Effect of Change to the Fair Value of Biological Assets and Depletion

With the ongoing increase in the price of timber over recent years, Dexco periodically adjusts the value of its biological assets to capture this market dynamic. Such adjustments reflect the high levels of demand for timber, the high volume of existing projects, and the increase in the prices of inputs and raw materials.

For 4Q24, the Change to the Fair Value of Biological Assets remained positive, but was down 65.3% on 4Q23, and 83.7% versus 3Q24. This change reflects the consolidation of higher timber prices, which has led to a smaller impact on the revaluation of forestry assets. The depletion of biological assets, which represents the utilization of the asset arising from its use, decreased by 43.4% versus 4Q23 and by 23.4% versus 3Q24, reflecting the Company's operating dynamics.

It should be noted that the price of sales transactions in the market is included in the calculation of the value of biological assets, as is the productivity of the Company's forests. The variation in the value of biological assets and exhaustion has no cash effect on Dexco's results.

Cost of Goods Sold

The Cost of Goods Sold, net of depreciation, amortization, depletion, and the net change in biological assets, totaled R$1,261.8 million for 4Q24, an increase of 7.3% compared to 4Q23. This growth reflects the increase in volumes across all divisions, which impacts variable costs, and the increase in dollarized inputs, arising from the elevated exchange rate at the end of the year. For the full year, COGS came in at R$5,023.8 million, an increase of 8.7% versus 2023, impacted by the factors cited above.

As a proportion of Net Revenue, the Cost of Goods Sold was flat, on an annual and quarterly comparison, reflecting improvements to the mix in the Metals and Sanitary Ware Division; the consistent performance of the panels segment in the Wood Division; and greater dilution of fixed costs arising from the increase in factory utilization. Thus, the Company recorded Pro Forma Gross Income of R$546.5 million for the quarter, an increase of 7.9% versus 4Q23, with a Pro Forma Gross Margin of 26.5%. Versus 2023, the increase in Pro Forma Gross Income was 3.8%, while the Pro Forma Gross Margin decreased by -2.3 p.p.

In addition, the increase in the share of Biological Asset Depletion, as well as in Depreciation, Amortization and Depletion during 2024, impacted Gross Income, which reflects the greater volume of forest harvested to meet demand for panels, and losses related to forestry trades carried out during the year.

Extraordinary events: (1) Cost of Goods Sold: 4Q24: Inventory impairment arising from the exit from Electric Showers and Faucets (+) R$11,129k,

Operational Restructuring (+) R$26,323k; 3Q24: Inventory impairment arising from the exit from Electric Showers and Faucets (+) R$48,922k,

Operational Restructuring (+) R$14,333k; 2Q24: Operational Restructuring (+) R$10,302k, Other (+) R$2,601k; 1Q24: Operational Restructuring (+)

R$5,257k; 2Q23: Operational Restructuring: (+) R$28,150k.

(2) Pro Forma Gross Income / Pro Forma consolidated Net Revenue.

Sales Expenses

Sales Expenses totaled R$314.3 million for 4Q24, an increase of 8.9% versus 4Q23, reflecting payments attributed to commission and expenses related to the expansion of points of sale, on the back of higher volumes sold and an increase in Net Revenue across all Divisions. Nevertheless, the ratio between Sales Expenses and Net Revenue remained stable, at 15.2% for the quarter.

For the full year, Sales Expenses totaled R$1,225.2 million, an increase of 17.5% versus 2023. This increase was driven by sales and marketing activities and investment in Advertising and Publicity, especially for the Metals, Sanitary Ware and Tiles divisions. In addition, maintenance and expansion of the point of sale (POS) network, together with new showrooms and the higher prices of freights contributed to the increase in expenses during the year, as part of the Company's strategy to expand operations and enhance its presence in the market.

General and Administrative Expenses

General and Administrative Expenses totaled R$82.8 million for 4Q24, a reduction of 11.4% versus 4Q23. For the full year, General and Administrative Expenses totaled R$303.6 million, a fall of 17.4% versus 2023. These gains come on the back of a diligent reassessment of the Company's expenses, coupled with efforts to optimize the organizational structure following a period of more robust investment the previous year. There was also a stronger base of comparison, impacted by investment in SAP S/4HANA. As a result, these expenses fell to 3.7% of Net Revenue in 2024, compared to 5.0% in 2023, emphasizing the gains in operational efficiency.

EBITDA

Dexco's Consolidated Adjusted and Recurring EBITDA in 4Q24 reached R$ 371.8 million, with a margin of 18.0%, an 8.1% decrease compared to 4Q23. The reduction is mainly due to lower fixed cost dilution resulting from the industry-wide collective vacation period and scheduled maintenance shutdowns across all divisions, as well as the absence of forestry business transactions that took place at the end of 2023, impacting the comparative base.

For the full year, Adjusted EBITDA totaled R$ 1,649.8 million, with a margin of 20.0%, an 18.4% increase over 2023. Growth was driven by higher demand for wood panels and forestry business transactions in 1Q24 and 3Q24, in addition to the recovery of the Metals and Ceramics Division, supported by a premium product mix, including the discontinuation of the electric shower and faucet operations.

LD Celulose delivered a total Adjusted and Recurring EBITDA of R$565.9 million for 4Q24, a record for the operation, of which R$277.0 million pertains to Dexco's 49.0% stake. Including the percentage arising from LD Celulose, Dexco's Adjusted and Recurring EBITDA for the quarter was R$648.8 million. For the full year, 2024, LD's Adjusted and Recurring EBITDA was R$1,616.2 million, of which R$790.8 million pertains to Dexco.

The table below shows the reconciliation of EBITDA, in accordance with CVM Instruction 156/22. From this result, and in order to better convey the Company's potential operating cash generation, two adjustments have been made: the exclusion from EBITDA of events of an accounting and non-cash nature, and the disregard of events of an extraordinary nature. Thus, in line with best practices, we present below the calculation of the indicator that best reflects the Company's cash generation potential.

1. Extraordinary events detailed in the attachment to this report; (2) Pro Forma Adjusted and Recurring EBITDA also includes Dexco's portion of the Recurring EBITDA arising from LD Celulose.

Financial Results

In 2024, the Financial Result was negative at R$ 592 million, a deterioration of R$ 74 million compared to the previous year, mainly driven by higher interest rates and an increase in net debt.

To mitigate these impacts, Dexco maintained a strong focus on Liability Management, leading to an extension of the average debt maturity and a reduction in the average cost of debt, supporting financial performance.

1. Extraordinary events impacting the Financial Revenue: 4Q24: Interest on extemporaneous credit: (-) R$8,701k 3Q24: Interest on INSS of 1/3 of vacations: (-) R$7,360k; 1Q24: Interest on INSS on the PIS COFINS base without IR CS (-) R$3.997k, Interest on ICMS on the PIS COFINS base (+) R$3,603k; 3Q23: Update of ICMS on the PIS COFINS base (-) R$183,712k; PIS and COFINS on SELIC ICMS interest on the base (+) R$4,438k

Net Income

Dexco's Recurring Net Income for 4Q24 was R$ -4.3 million, with a recurring ROE of -0.3%, a result that represents a drop-off versus the same period of the previous year, arising mainly from costs incurred during the ramp up of the new Tiles plant at Botucatu (SP). For the full year 2024, the Company's Recurring Net Income was R$274.1 million, a fall of 26.1% versus 2023, with a Recurring ROE of 4.1%, driven by higher interest rates, which impacted financial expenses, and a lower variation in biological assets.

The results for both the quarter and year were also impacted by the sum recorded via the equity equivalence method from the LD Celulose operation - which has an accounting rather than cash effect

• of negative R$79.3 million for the quarter. As announced in October 2024, LD Celulose refinanced its financing structure, replacing Project Finance with Corporate Finance, which incurred one-off charges impacting the results for the period. Thus, Pro Forma Recurring Net Income was R$83.7 million for 4Q24 and R$201.4 million for the full year.

1. Extraordinary events detailed in the Attachment to this material; (2) Pro Forma Recurring Net Income also includes Dexco's portion of the Recurring EBITDA arising from LD Celulose.

Cash Flow

Dexco closed out 4Q24 with Sustaining Free Cash Flow generation of R$244.8 million, with total cash generation for the quarter of R$142.1 million, including the projects of the investment cycle. In this period, working capital management was boosted by a extension of supplier payment terms, which contributed to a need for less operational financing. Despite the increase in inventory, the Company reported a reduction in Working Capital, reflecting greater efficiency in the allocation of operational resources. As a result, the Working Capital/Net Revenue ratio was 11.3% for 4Q24, a reduction of 0.8 p.p. versus 4Q23 and 3.6% in comparison to 3Q24.

On an annual comparison, sustaining cash generation reduced consumption of working capital, leading the Company to close out the period with a positive cash balance of R$390.8 million. However, including