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Braskem Cuts Quarterly Loss 96% As Alagoas Deal Lifts Investor Confidence
(MENAFN- The Rio Times) Braskem's shares surged after the petrochemical producer slashed its quarterly loss, reached a long-negotiated settlement with the state of Alagoas, and saw renewed chatter around the sale of Novonor's stake.
The rally reflects a market that rewards cleaner balance-sheet visibility, firmer governance prospects, and pragmatic policy signals. The numbers were“less bad” in a way investors like.
The company posted a net loss of R$26 million ($5 million) in the third quarter, a 96% improvement from a year earlier. Recurring EBITDA was R$818 million ($151 million), down year on year but consistent with an industry still facing weak spreads.
The stock's jump mirrors relief that the legal and ownership clouds may finally be thinning. The Alagoas agreement totals R$1.2 billion ($222 million), with R$139 million ($26 million) already paid and R$467 million ($86 million) previously provisioned.
It doesn't remove long-term cash pressure, but it replaces legal ambiguity with a payment plan investors can model. Meanwhile, reports of advanced talks between Novonor and IG4 Capital to sell Braskem 's controlling stake revive hopes for a simpler, more bankable shareholder structure.
Progress here matters: a stable controller can unlock cheaper funding and a clearer strategy. Analyst takes were mixed but pragmatic.
One camp notes a near-breakeven bottom line driven by better operations and tax credits, offset by higher financial expenses. Another highlights still-heavy cash burn-about $1.1 billion in the first nine months of 2025-and warns that a true recovery likely depends on spreads returning toward mid-cycle.
A set of policy supports-debated changes to REIQ/PRESIQ benefits for the chemical chain, renewed import tariffs, and anti-dumping measures-could help bridge the gap until markets improve.
Why this matters beyond the ticker: Brazil's basic-materials champions need legal certainty, competitive tax frameworks, and predictable ownership to invest and hire.
Braskem's week is a case study in how steady, rules-based fixes can calm an industrial turnaround. The risk is clear-global demand and financing costs still bite-but the direction of travel is toward discipline over drama.
The rally reflects a market that rewards cleaner balance-sheet visibility, firmer governance prospects, and pragmatic policy signals. The numbers were“less bad” in a way investors like.
The company posted a net loss of R$26 million ($5 million) in the third quarter, a 96% improvement from a year earlier. Recurring EBITDA was R$818 million ($151 million), down year on year but consistent with an industry still facing weak spreads.
The stock's jump mirrors relief that the legal and ownership clouds may finally be thinning. The Alagoas agreement totals R$1.2 billion ($222 million), with R$139 million ($26 million) already paid and R$467 million ($86 million) previously provisioned.
It doesn't remove long-term cash pressure, but it replaces legal ambiguity with a payment plan investors can model. Meanwhile, reports of advanced talks between Novonor and IG4 Capital to sell Braskem 's controlling stake revive hopes for a simpler, more bankable shareholder structure.
Progress here matters: a stable controller can unlock cheaper funding and a clearer strategy. Analyst takes were mixed but pragmatic.
One camp notes a near-breakeven bottom line driven by better operations and tax credits, offset by higher financial expenses. Another highlights still-heavy cash burn-about $1.1 billion in the first nine months of 2025-and warns that a true recovery likely depends on spreads returning toward mid-cycle.
A set of policy supports-debated changes to REIQ/PRESIQ benefits for the chemical chain, renewed import tariffs, and anti-dumping measures-could help bridge the gap until markets improve.
Why this matters beyond the ticker: Brazil's basic-materials champions need legal certainty, competitive tax frameworks, and predictable ownership to invest and hire.
Braskem's week is a case study in how steady, rules-based fixes can calm an industrial turnaround. The risk is clear-global demand and financing costs still bite-but the direction of travel is toward discipline over drama.
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