Cosan (NYSE:CSAN) reported a narrower net loss for the second quarter of 2026 as the Brazilian conglomerate advanced debt-reduction, divestment and cost-cutting efforts designed to simplify its holding-company structure.
Net loss totaled BRL 320 million for the quarter, an improvement from the prior-year period. Fernando Tinel attributed the improvement primarily to better financial results, lower effective income-tax and social-contribution expenses, reduced general and administrative costs, and the continued non-recognition of Raízen’s results. Those factors more than offset a BRL 233 million one-time impairment related to the Terminal de Uso Privado São Luís.
Debt Reduction and Asset Sales
The company said it made approximately BRL 8.8 billion in principal payments since the beginning of the year, including full prepayments of bonds maturing in 2029, 2030 and 2031, along with early amortization of debentures and commercial notes. The actions reduced debt maturities scheduled for 2028 by more than BRL 2.5 billion, Cosan said.
At quarter-end, the company’s debt had an average maturity of 6.2 years and an average cost of CDI plus 1.15% annually. Tinel said the decline in net debt was driven by proceeds from Compass’ initial public offering, dividends from investees and yields on financial investments.
Compass’ IPO, completed through a secondary share offering, generated BRL 2.3 billion in net proceeds for Cosan during the first half. The company also announced an agreement to sell part of Radar’s Mato Grosso land portfolio for BRL 1.85 billion. Cosan expects its indirect share of proceeds to total approximately BRL 586 million at closing, which is expected by Oct. 30, subject to customary conditions.
Separately, Cosan signed an exclusive letter of intent to fully divest its stake in the Terminal de Uso Privado Porto São Luís. The proposal calls for BRL 300 million at closing and could include an indicative earn-out of BRL 50 million for each additional berth added through future port-capacity expansion.
Coverage Outlook and Lower Overhead
Cosan’s debt service coverage ratio stood at 0.2 times on a last-12-month basis, down 0.2 times from the prior quarter. Management said the result reflected the timing of dividend and equivalent distributions from investees, which are more heavily concentrated in the second half of the year, and the fact that lower financial expenses from debt prepayments have not yet been fully reflected in the metric.
The company began providing a year-end outlook for the ratio and expects it to reach between 0.8 times and 1.2 times by December. The forecast assumes BRL 1.2 billion to BRL 1.8 billion in dividends and equivalent distributions during 2026, including up to BRL 586 million related to the Radar transaction. Potential future divestments under evaluation are not included in the projection.
Cosan also reported a roughly 36% decline in general and administrative expenses, or BRL 49 million in savings, during the first six months of 2026 versus the same period a year earlier. The company announced plans to delist its American depositary shares from the New York Stock Exchange and intends to pursue SEC deregistration in the future as part of its simplification agenda.
Marcelo Martins said management expects to pursue further reductions in overhead as the holding company becomes leaner. Rafael Bergmann said the ADS delisting should make operations simpler over time, although Cosan will continue meeting SEC obligations during 2026 while the deregistration process is not complete.
Investee Performance
- Rumo: Transported 23.8 billion revenue ton-kilometers, up 9% year over year, supported by grain volumes in its North and South operations. EBITDA was BRL 2.3 billion, broadly stable from the prior-year period. Excluding insurance indemnities and an equity-income reclassification, EBITDA would have risen 4%, Cosan said.
- Compass: Distributed volume was stable year over year. Weaker industrial demand in chemicals, steel and ceramics was offset by residential and commercial performance with higher margins. EBITDA increased 5%, supported by Edge’s load-optimization initiatives.
- Moove: EBITDA more than doubled from the first quarter amid supply disruptions associated with the closure of the Strait of Hormuz. Management cited inventory management, higher sales volume and revenue growth. EBITDA was down 6% from a year earlier because the comparison period included insurance recoveries and other one-time effects tied to a fire at an industrial complex in Rio de Janeiro.
- Radar: Performance was affected by the revaluation of part of its portfolio following the announced land disposal and lower net operating revenue, with lower ATR prices affecting lease contributions.
Management also noted that Raízen’s out-of-court reorganization plan was approved by 81.6% of its financial creditors. Martins described the approval as an important step in Raízen’s turnaround process.
Portfolio and Management Changes
During the question-and-answer session, Martins said Cosan continues to pursue the previously announced sale of part of its Rumo stake and is in discussions with potential buyers, but did not provide additional details. He said the company is not currently considering an IPO for Moove or a sale of its Moove stake.
Management said Radar remains a valuable portfolio and that Cosan intends to monetize assets when valuations are appropriate, rather than liquidating them at any cost.
Martins also discussed leadership changes, saying Maria Rita and Rafael Bergmann decided to leave amid the restructuring and reduction of holding-company expenses. He welcomed Cesario back to the company, saying he had previously spent eight years with Cosan before leaving in 2017.
About Cosan (NYSE:CSAN)
Cosan Limited (NYSE: CSAN) is a Brazilian diversified energy and logistics group focused on agribusiness, fuels, and infrastructure. Its core activities include the cultivation of sugarcane, production of ethanol and sugar, generation of bioelectricity from bagasse, and distribution of fuels under the Raízen joint venture with Shell. Through its subsidiary Moove, Cosan is a leading global producer of base oils and lubricants, while Comgás serves as one of Brazil’s largest natural gas distributors.
Founded in 1936 in the state of São Paulo, Cosan has grown through organic expansion and strategic acquisitions.
