Ultrapar Participacoes (NYSE:UGP) outlined its capital-allocation priorities, operating initiatives and portfolio strategy at its Ultra Day event, with executives emphasizing safety, financial discipline and investments in logistics, energy distribution and adjacent businesses.
Chief Executive Officer Rodrigo Pizzinatto said the company has reshaped its portfolio since 2021 and 2022 through the sales of Extrafarma, Oxiteno and ConectCar. He said Ultrapar has since focused on its remaining core operations while pursuing selected acquisitions and expansion projects, including investments in Ultragaz, Ultracargo and Hidrovias do Brasil.
According to Pizzinatto, Ultrapar invested BRL 10.5 billion in expansion and productivity initiatives, about BRL 1 billion in adjacent businesses and BRL 2.9 billion in new businesses, primarily related to Hidrovias. The company also paid BRL 7.4 billion in interest on debt and BRL 5 billion through dividends and buybacks, including BRL 570 million in repurchases at roughly BRL 18 to BRL 19 per share.
Leadership, incentives and capital discipline
The CEO said Ultrapar’s capital-allocation process evaluates investments in core businesses, adjacent opportunities and potential new sectors. The company also considers debt reduction, dividends and share buybacks when it has excess cash and limited higher-return alternatives.
For senior leadership, Pizzinatto said 70% of compensation is variable, with a portion linked to annual EBITDA and cash-flow targets and a longer-term component based on economic value added and total shareholder return. He said executives, board members and participants in the company’s partner plan collectively hold 25 million shares, or 2.3% of Ultrapar’s capital.
Chief Financial Officer Alexandre Palhares said Ultrapar’s leverage stood at about one times EBITDA in 2026, following stronger operating results and cash generation. He said the company views leverage of between one and 1.5 times as comfortable amid a more uncertain macroeconomic and geopolitical environment.
Palhares also said corporate overhead costs declined to BRL 220 million from BRL 260 million as the company pursued simplification and efficiency initiatives.
Ipiranga cites stronger fuel-market conditions
Ipiranga CEO Leonardo Linden said the fuel distribution market has benefited from increased enforcement against illegal trade, tax evasion and organized crime. He cited comments that fuel ICMS tax collections in Rio de Janeiro rose 87% in 2026, while collections across Rio de Janeiro and São Paulo increased 40%.
Linden said geopolitical conflict and supply disruptions have increased volatility in fuel markets, requiring Ipiranga to prioritize supply reliability and imports. The company has expanded its trading capabilities and grew spot-market consumption volume by 50%, he said.
Ipiranga continues to focus on supply flexibility, logistics efficiency, service-station network quality, convenience offerings and B2B customer segmentation. Linden said the company has invested in remodeling stations, refreshing its Km de Vantagens loyalty program and expanding partnerships such as Krispy Kreme within AmPm convenience stores.
He also highlighted regional diesel retail partnerships and an enterprise-resource-planning, or ERP, project intended to improve processes and organizational efficiency. Ipiranga has mapped successors for 84% of key positions and replaced 45% of its executive team, Linden said.
Ultragaz and ICONIC expand beyond traditional operations
Ultragaz CEO Tabajara Bertelli Costa said the company is reinforcing its retail LPG model while expanding in higher-value bulk segments, biomethane, electricity and specialty gases. The company increased its reseller base to 6,300 from 5,800 and raised the retail share of volume to 66% in 2022, compared with a historical mix closer to 50%.
Costa said Ultragaz’s ERP modernization project could reduce annual operating costs by more than BRL 100 million once deployed in 2028. The company is also developing a terminal in Pecém and a new base in Rio Verde aimed at supporting agribusiness customers.
In biomethane, Ultragaz has contracted more than 45 customers, with more than half already in operation, according to Costa. The company also expects to open a biomethane fueling operation at an Ipiranga station.
ICONIC, Ultrapar’s lubricants joint venture with Chevron, said it is building on its infrastructure, technology center and dual Ipiranga and Texaco brand portfolio. CEO Alexandre Bassaneze said ICONIC serves more than 100,000 customers across Brazil and the Southern Cone and has expanded into base-oil and additive distribution.
Logistics businesses focus on capacity and operational improvements
Ultracargo CEO Fulvius Tomelin said the company operates nine terminals with 1.2 million cubic meters of capacity and handled 11 million tons, representing 17 million cubic meters sold. He said Ultracargo’s cost and expenses per static cubic meter have declined at an average annual rate of 6% since 2019, while EBITDA rose 154% despite a 39% increase in capacity.
Tomelin said the company is building a terminal in Miritituba to support fuel and biofuel logistics in Brazil’s northern corridor. He acknowledged that EBITDA declined in 2026 compared with the prior year amid disruptions in fuel markets.
At Hidrovias do Brasil, CFO and Investor Relations Officer André Saleme Hachem said the company has reduced leverage to 2.4 times from seven times after a BRL 1.2 billion capital injection, refinancing actions and improved results. Hidrovias also divested its coastal shipping business and is reorganizing operations around navigation and terminals.
Executives said Hidrovias faced operational challenges during the 2026 harvest season but expects its lessons from receiving capacity, truck flows and transshipment operations to support improved performance in 2027.
During the question-and-answer session, Pizzinatto said Ultrapar would consider share repurchases, dividends and investments based on available opportunities, rather than following a fixed allocation formula. He added that the company could temporarily exceed its preferred leverage range for an attractive investment with a clear path to deleveraging.
About Ultrapar Participacoes (NYSE:UGP)
Ultrapar Participações SA is a Brazilian holding company with operations focused on energy, fuel distribution and logistics. Through its businesses, the company supplies fuels, liquefied petroleum gas (LPG) and related services to consumers, commercial customers and industrial clients.
Its principal businesses include Ipiranga, one of Brazil’s major fuel distribution companies, and Ultragaz, which distributes LPG for residential, commercial and industrial use. Ultrapar also owns Ultracargo, a provider of storage and handling services for liquid bulk products, including fuels, chemicals and other industrial materials.
Ultrapar’s operations are concentrated primarily in Brazil, with activities supported by distribution networks, terminals and storage infrastructure across key regions of the country.
