UNITED STATESSECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 20-F
☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2025
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number: 001-40155
COSAN S.A.(Exact name of Registrant as specified in its charter)
COSAN INC.(Translation of Registrant’s name into English)
Federal Republic of Brazil(Jurisdiction of incorporation or organization)
Av. Brigadeiro Faria Lima, 4,100 – 16th floorSão Paulo – SP, 04538-132, Brazil+55 11 3897-9797(Address of principal executive offices)
Rafael Bergman
+55 11 3897-9797
ri@cosan.com
Av. Brigadeiro Faria Lima, 4,100 – 16th floor
São Paulo – SP, 04538-132, Brazil
(Name, Telephone, Email and/or Facsimile number and Address of Company Contact Person)
Securities registered or to be registered pursuant to Section 12(b) of the Act.
Title of Each Class
Trading Symbol
Name of Each Exchange on Which Registered
American depositary shares, each representing four common shares, no par value
CSAN
New York Stock Exchange
Common shares, no par value*
New York Stock Exchange*
* Not for trading purposes, but only in connection with the listing of American Depositary Shares pursuant to the requirements of the Securities and Exchange Commission.
Securities registered or to be registered pursuant to Section 12(g) of the Act.
None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.
The number of outstanding shares as of December 31, 2025 was:
Title of Class
Number of Shares Outstanding
Common shares, no par value
3,966,570,932
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes ☒ No ☐
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
Yes ☐ No ☒
Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer ☒ Accelerated Filer ☐ Non-accelerated Filer ☐ Emerging growth company ☐
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐
† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☒
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to § 240.10D-1(b). ☐
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
☐ U.S. GAAP
☒ International Financial Reporting Standards as issued by the International Accounting Standards Board
☐ Other
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.
☐ Item 17 ☐ Item 18
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Table of Content
Page
We present our consolidated financial statements in accordance with International Financial Reporting Standards, or “IFRS Accounting Standards,” as issued by the International Accounting Standards Board, or “IASB.”
The consolidated financial statements are presented in Brazilian reais, the functional and presentation currency of Cosan S.A., or “Cosan” or “Cosan S.A.,” which is the currency of the primary economic environment in which Cosan and its subsidiaries and jointly-controlled entity, located in Brazil, operate and generate and use cash. The functional currency for the subsidiaries located outside Brazil is the U.S. dollar, British pound or the Euro. Cosan S.A. and its subsidiaries are collectively referred to as the “Company,” “we,” “us” and “our.”
Financial Statements
We have included in this annual report our audited consolidated financial statements as of December 31, 2025 and 2024 and for the fiscal years ended December 31, 2025, 2024 and 2023.
All references herein to “our financial statements” and “our consolidated financial statements” are to our audited consolidated financial statements as of December 31, 2025 and 2024 and for the fiscal years ended December 31, 2025, 2024 and 2023 included elsewhere in this annual report.
Certain Corporate Events
Interest in Raízen S.A., or “Raízen”
In 2011, we and Shell Brazil Holdings B.V., or “Shell,” formed two joint ventures, or the “Joint Venture,” for a combined 50/50 investment, under the name “Raízen.”
As of December 31, 2025, Cosan S.A.’s total ownership interest in Raízen S.A. was 30.84%, comprising a 5.00% direct interest and a 25.84% indirect interest. This indirect interest arises from Cosan’s 66.16% ownership interest in Cosan Nove Participações S.A. (“Cosan Nove”), which, in turn, holds a 39.06% interest in Raízen.
For further information, see note 4, “Segment Information,” to our consolidated financial statements as of December 31, 2025, 2024 and 2023 and for the fiscal years ended December 31, 2025, 2024 and 2023 included elsewhere in this annual report.
Disposition of Significant Interest in Vale S.A., or “Vale”
On October 14, 2022, our subsidiary Cosan Oito S.A., or “Cosan Oito,” completed the R$16,425.4 million investment in the shares of Vale. The investment consisted of several transactions starting in September 2022, which included: (i) the acquisition of 1.55% of Vale’s shares in the open market for R$4,918.2 million; (ii) the purchase of 3.31% of Vale’s shares in a private placement transaction for R$11,117.8 million, together with derivative financial instruments (from which we received a R$499.2 million premium) to partially hedge our exposure to changes in Vale’s share price; and (iii) the acquisition of a call spread, which consisted of a synthetic economic exposure (“forward”) to an additional 1.6% of Vale’s shares in the open market at a predetermined price per share (for which we paid a R$1,134.9 million premium), together with derivative financial instruments to partially hedge our exposure to changes in Vale’s share price, from which we received a R$246.3 million premium (with the option, subject to satisfaction of certain conditions, to negotiate with the derivative banks in good faith to convert this synthetic exposure into outright ownership subject to the same cap and floor prices). Except as otherwise specified herein, all percentages of Vale’s shares as used in this section are based on 4,535,617,099 Vale shares outstanding as of October 31, 2022.
We initially recorded our shareholding in Vale as a financial asset accounted for at fair value in accordance with IFRS 9. On April 28, 2023, at Vale’s general shareholder’s meeting, our then-chief executive officer, Luis Henrique Cals de Beauclair Guimarães, was elected as a member of Vale’s board of directors, and, on May 16, 2023, was appointed coordinator of Vale’s capital and projects allocation committee, or the “CACP,” and a member of Vale’s people and compensation committee, or “CPR.” During the year ended December 31, 2023, we monitored the factors that could indicate our having significant influence in Vale, given Mr. Guimarães’ participation in Vale’s CACP and CPR. On November 30, 2023, we obtained sufficient evidence that demonstrated our ability to exert significant influence on Vale’s policies and operations, given that Mr. Guimarães was able to participate in policy-making processes, including decisions relating to dividends and other distributions. From this date, we began to consider Vale as an associate over which we have significant influence and to account for our investment in Vale using the equity method in accordance with IAS 28. As of December 31, 2023, we held a 4.90% interest in Vale’s share capital.
On April 19, 2024, the Company disposed of 33,524,185 common shares of Vale S.A., representing 0.78% of the voting share capital. Subsequently, on January 16, 2025, the Company disposed of an additional 173,073,795 common shares of Vale, representing 4.05% of the share capital, for a net amount of R$ 8,892.8 million, net of brokerage commissions. Following that transaction, the Company retained a position of 4,268,720 common shares of Vale, representing 0.10% of the share capital, with a carrying amount of R$ 242.0 million. As of December 31, 2025, the fair value of such remaining position, classified as a financial asset measured at fair value through profit or loss in accordance with IFRS 9, amounted to R$ 307.2 million.
On January 12, 2026, the Company disposed of the remaining interest for R$ 319.7 million. Additionally, on January 9 and January 12, 2026, the Company early settled the call spread derivative structure relating to 4,268,720 shares, resulting in a cash inflow of R$ 91.9 million.
Out-of-Court Reorganization of Raízen
The Company holds a significant interest in Raízen, classified as a joint venture and accounted for using the equity method. On February 12, 2026, Raízen disclosed in its interim financial reports a significant uncertainty regarding its ability to continue as a going concern.
Given this scenario, Raízen revised the assumptions used in the impairment tests for its assets, making the necessary adjustments and provisions. These events, combined with a high level of indebtedness, resulted in significant losses and negative shareholders’ equity of R$1,132.5 million on December 31, 2025. As of the date of this annual report, no formal capital reinforcement agreement had been executed.
The Company’s management assessed that this event does not compromise the Company’s own ability to continue as a going concern, as it maintains a solid capital structure and adequate liquidity to honor its obligations as they come due.
Based on the information available on December 31, 2025, the investment in Raízen was reduced to zero on the Company’s balance sheet, and no additional liability was recognized. This is because the Company concluded, together with its legal advisors, through a review of contracts, corporate documentation, and other documents related to Raízen, that it has no legal or constructive obligations to provide financial support to Raízen. Management will continue to monitor the evolution of Raízen’s corporate and financial restructuring process, with any impacts being recognized in the periods in which they occur.
On March 4, 2026, Raízen issued a material fact notice informing about measures to strengthen its capital structure, including the pursuit of a negotiated solution with its financial creditors. On March 11, 2026, Raízen filed a petition for an out‑of‑court reorganization proceeding (Recuperação Extrajudicial), an extrajudicial restructuring of a strictly financial nature, which does not cover obligations to customers, suppliers, resellers, and other commercial partners. On March 12, 2026, it was announced that the 3rd Bankruptcy and Judicial Reorganization Court of the District of São Paulo granted the processing of the out‑of‑court reorganization of Raízen and certain subsidiaries. This resulted in the suspension, for 180 days, of lawsuits and enforcement actions related to the claims covered by the proceeding, as well as a 90‑day deadline to prove the quorum required for court approval of the plan, in accordance with Law No. 11,101/2005. As further disclosed by Raízen in a material fact notice on March 11, 2026, the out‑of‑court reorganization plan may involve (i) the capitalization of the Raízen Group by its shareholders; (ii) the conversion of part of the subject claims into an equity interest in Raízen; (iii) the replacement of part of the subject claims with new debt; (iv) corporate reorganizations aimed at segregating a portion of the businesses currently conducted by the Raízen Group; and (v) the sale of assets from the Raízen Group.
Raízen remains in negotiations with its financial creditors and awaits court approval of the plan to define the renegotiation of its liabilities, as well as the alternatives for raising the funds necessary for operations and cash flows for future periods. Additionally, management evaluated this subsequent event and concluded that it is a non‑adjusting subsequent event (which does not adjust the December 31, 2025 financial statements).
Special Note Regarding Non-IFRS Financial Measures
This annual report presents our EBITDA and Net debt, which are non-IFRS financial measures. A non-IFRS financial measure is generally defined as one that purports to measure financial performance but excludes or includes amounts that would not be so adjusted in the most comparable measure under IFRS Accounting Standards.
We define EBITDA as profit (loss) for the year plus income taxes, plus finance results, net, plus depreciation and amortization. EBITDA is not an IFRS measure. Our calculation of EBITDA may differ from the calculation of similarly titled measures used by other companies. Our management believes that disclosure of EBITDA is useful as a supplemental measure for evaluating our operating performance and that EBITDA is also useful in allocating resources across our business segments, as it eliminates the impact of financing, tax, and depreciation/amortization variations. However, EBITDA is not a measure under IFRS Accounting Standards and should not be considered in isolation or as a substitute for net income or operating income prepared in accordance with IFRS. For a reconciliation of EBITDA to the most directly comparable measure under IFRS Accounting Standards, see “Item 3. Key Information—A. Selected Financial Data.”
We define Net Debts as current and non-current loans, borrowings and debentures less cash and cash equivalents, less current and non-current marketable securities, and less derivatives on debt (asset) or plus derivatives on debt (liability). Our calculation of Net Debt may differ from the calculation of similarly titled measures used by other companies. Our management believes that disclosure of Net Debt is useful to potential investors as it helps to give them a clearer understanding of our financial liquidity. Net Debt is also used to calculate certain leverage ratios and compliance with covenants. However, Net Debt is not a measure under IFRS Accounting Standards and should not be considered as a substitute for measures of indebtedness determined in accordance with IFRS Accounting Standards. For a reconciliation of Net Debt to the most directly comparable measure under IFRS Accounting Standards, see “Item 3. Key Information—A. Selected Financial Data.”
Market Data
We obtained market and competitive position data, including market forecasts, used throughout this annual report from market research, publicly available information and industry publications, as well as internal surveys. We include data from reports prepared by LMC International Ltd., the Central Bank of Brazil (Banco Central do Brasil), or the “Central Bank of Brazil,” the Sugarcane Agroindustry Association of the State of São Paulo (União da Agroindústria Canavieira de São Paulo), or “UNICA,” the Brazilian Ministry of Agriculture, Livestock, and Supply (Ministério da Agricultura, Pecuária e Abastecimento), or “MAPA,” the Brazilian Institute of Geography and Statistics (Instituto Brasileiro de Geografia e Estatística), or “IBGE,” the Brazilian Ministry of Development, Industry and Foreign Trade (Ministério do Desenvolvimento e do Comércio Exterior), or “MDIC,” the Brazilian Ministry of Infrastructure (Ministério da Infraestrutura), or “MI,” the Food and Agriculture Organization of the United Nations, or “FAO,” the National Traffic Agency (Departamento Nacional de Trânsito—DENATRAN), the Brazilian Association of Vehicle Manufacturers (Associação Nacional dos Fabricantes de Veículos Automotores—ANFAVEA), Datagro Publicações Ltda., F.O. Licht, Czarnikow, Apoio e Vendas Procana Comunicações Ltda., the São Paulo Stock, Commodities and Futures Exchange (B3 S.A. – Brasil, Bolsa, Balcão), or “B3,” the Brazilian Securities Commission (Comissão de Valores Mobiliários), or “CVM,” the International Sugar Organization, the Brazilian National Economic and Social Development Bank (Banco Nacional de Desenvolvimento Econômico e Social), or “BNDES,” the New York Board of Trade, or “NYBOT,” the New York Stock Exchange, or “NYSE,” the Brazilian Agricultural Research Corporation (Empresa Brasileira de Pesquisa Agropecuária), or “Embrapa,” the Brazilian Secretariat for Foreign Trade (Secretaria de Comércio Exterior), or “Secex,” the National Supply Company (Companhia Nacional de Abastecimento), or “Conab,” the United States Department of Agriculture, or “USDA,” the London Stock Exchange, the National Agency of Petroleum, Natural Gas and Biofuels (ANP – Agência Nacional do Petróleo, Gás Natural e Biocombustíveis), or “ANP,” the Brazilian Antitrust Authority (Conselho Administrativo de Defesa Econômica), or the “Brazilian Antitrust Authority,” the National Union of Distributors of Fuels and Lubricants (Sindicato Nacional das Empresas Distribuidoras de Combustíveis e de Lubrificantes), or “Sindicom,” the Sanitation and Energy Regulatory Agency for the State of São Paulo (Agência Reguladora de Energia de São Paulo), or “ARSESP,” the Brazilian Gas Distributors Association (Associação Brasileira das Empresas Distribuidoras de Gás), or “ABEGÁS,” the Agriculture School of the University of São Paulo (Escola Superior de Agricultura Luiz de Queiroz), or “ESALQ,” the National Waterway Transportation Agency (Agência Nacional de Transportes Aquaviários), or “ANTAQ,” the Brazilian Transportation Authority (Agência Nacional de Transporte Terrestre), or “ANTT,” Estação da Luz Participações Ltda., or “EDLP,” the National Electric Energy Agency (Agência Nacional de Energia Elétrica), or “ANEEL,” and the Chamber of Electric Energy Commercialization (Câmara de Comercialização de Energia Elétrica), or “CCEE.” We believe that all market data in this annual report is reliable, accurate and complete.
Terms Used in This Annual Report
In this annual report, we present information in gallons, liters and cubic meters (m³ or cbm). In addition, we also present information in tons. In this annual report, references to “ton” or “tonne” refer to the metric tonne, which is equal to 1,000 kilograms.
All references in this annual report to “TSR” are to total sugar recovered, which represents the total amount of sugar content in a given quantity of sugarcane.
All references in this annual report to “RTK” mean revenue ton kilometer.
All references to the “real,” “reais” or “R$” are to the Brazilian real, the official currency of Brazil. All references in this annual report to “U.S. dollars,” “dollars” or “U.S.$” are to U.S. dollars. All references to the “Euro,” “Euros,” “€” or “EUR” are to the official currency of the European Union. All references to the “Yen,” “¥” or “JP¥” are to the Japanese Yen, the official currency of Japan. All references to the “Pound Sterling,” “Pounds,” “£” are to the British Pound, the official currency of the United Kingdom.
Rounding
We have made rounding adjustments to reach some of the figures included in this annual report. Accordingly, numerical figures shown as totals in some tables may not be an arithmetic aggregation of the figures that preceded them.
This annual report contains estimates and forward-looking statements, mainly under “Item 3. Key Information—D. Risk Factors,” “Item 4. Information on the Company—B. Business Overview” and “Item 5. Operating and Financial Review and Prospects.” Some of the matters discussed concerning our business and financial performance include estimates and forward-looking statements.
Our estimates and forward-looking statements are mainly based on our current expectations and estimates on projections of future events and operating and financial trends, which affect or may affect our industry, market share, reputation, businesses, financial condition, results of operations, margins and/or cash flow. Although we believe that these estimates and forward-looking statements are based upon reasonable assumptions, they are subject to several risks and uncertainties, are made in light of information currently available to us and should not be considered a guarantee of the results of operations we may achieve. Many significant factors in addition to those stated in this annual report may adversely affect our current estimates and forward-looking statements, and whether these estimates or statements may be realized. Our estimates and forward-looking statements may be influenced by the following factors, among others:
The words “believe,” “should,” “may,” “might,” “could,” “seek,” “aim,” “likely,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect” and other similar words used in this annual report are intended to identify estimates and forward-looking statements. Estimates and forward-looking statements speak only as of the date they were made, and we undertake no obligation to update or to review any estimate and/or forward-looking statement because of new information, future events or other factors. Estimates and forward-looking statements involve risks and uncertainties and are not guarantees of future performance. Our future results may differ materially from those expressed in these estimates and forward-looking statements. In light of the risks and uncertainties described above, the estimates and forward-looking statements discussed in this annual report might not occur and our future results and our performance may differ materially from those expressed in these forward-looking statements due to but not limited to, the factors mentioned above. Because of these uncertainties, you should not make any investment decision based on these estimates and forward-looking statements.
Not applicable.
The following tables present selected historical financial and operating data for the Company derived from our consolidated financial statements. You should read the following information in conjunction with our consolidated financial statements and related notes, and the information under “Item 5. Operating and Financial Review and Prospects” in this annual report.
The financial data as of December 31, 2025 and 2024 and for the fiscal years ended December 31, 2025, 2024 and 2023 have been derived from our consolidated financial statements prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board, or “IFRS Accounting Standards,” and included elsewhere in this annual report. See “Presentation of Financial and Other Information—Financial Statements.”
Consolidated Statement of Profit or Loss Data:
Net sales
40,418.6
43,950.7
39,468.5
Cost of sales
Gross profit
Selling expenses
(1,850.1
(1,575.9
(1,350.6
General and administrative expenses
(2,527.7
(2,845.3
(2,528.0
Other operating income, net
3,161.3
1,549.8
3,924.4
Impairment
(1,493.7
(3,155.4
—
Operations expenses
Profit before equity in earnings of investees, finance results and income taxes
10,465.2
7,687.9
10,964.4
Impairment in associate
(4,672.4
Equity in (losses) earnings of investees
(10,665.1
489.1
2,046.3
Finance results, net
(Loss) profit before income taxes
(7,991.3
(5,245.1
5,113.8
Income taxes:
Current
(1,286.3
(1,952.2
(1,645.1
Deferred
(Loss) profit for the year from continuing operations
(10,194.4
(8,435.6
4,839.3
Profit for the year from discontinued operations, net of tax
273.9
45.4
(Loss) profit for the year
(8,161.8
4,884.7
(Loss) profit attributable to non-controlling interests
(Loss) profit attributable to owners of the Company
Consolidated Statement of Financial Position Data:
Cash and cash equivalents
27,243.7
16,903.5
14,658.5
Marketable securities (current and non-current)
2,992.6
3,386.3
3,504.0
Inventories
1,969.3
2,072.9
1,792.7
Right-of-use assets
9,662.9
9,958.8
9,513.5
Property, plant and equipment
26,795.7
16,818.9
21,240.0
Intangible assets and goodwill
26,706.6
26,330.8
22,650.3
Total assets
135,117.5
141,265.9
139,865.4
Current liabilities
15,548.4
17,912.8
16,158.8
Non-current liabilities
88,559.5
83,954.7
72,725.4
Loans, borrowings and debentures (current and non-current)
64,227.1
66,455.4
56,904.7
Provision for legal proceedings
2,058.1
2,044.6
1,714.4
Equity attributable to owners of the Company
5,304.2
10,903.8
20,955.3
Equity attributable to non-controlling interests
Total shareholders’ equity
Consolidated Other Financial Data:
Depreciation and amortization
3,890.8
3,868.6
3,364.9
Net Debt(1)
34,126.4
44,846.1
39,733.0
Working capital(2)
24,539.3
12,861.6
12,451.4
Net Cash generated by (used in):
Operating activities
13,026.8
13,081.3
10,276.4
Investing activities
(76.1
(4,488.3
(4,303.1
Financing activities
(2,351.9
(6,605.9
(4,516.6
Basic earnings per share from continuing operations
(3.89
(5.16
0.58
Diluted earnings per share from continuing operations
(3.94
Basic earnings per share from discontinued operations
0.10
0.01
Diluted earnings per share from discontinued operations
Number of shares outstanding
1,866,570,932
1,867,556,421
Declared dividends (millions of reais)
2,831.7
2,948.7
2,375.6
Declared dividends (millions of U.S. dollars)
506.6
476.2
490.7
Declared dividends per share (reais)
(3.8900
(5.1586
0.5778
Declared dividends per share (U.S. dollars)
(0.6959
(0.8331
0.1193
Other Operating Data:
Crushed sugarcane (in million tons)
70.9
78.6
83.5
Sugar production (in million tons)
4.8
5.1
5.8
Ethanol production (in billion liters)
2.6
3.2
3.1
Volume of fuel sold (in million liters)
35,259.0
34,567.0
35,295.4
Volume loaded (Rumo) (in million tons)
Transported volume (Rumo) (in million RTK)
84,198.0
79,847.0
77,258.4
Natural gas (Compass) (in million m³)
5,277.3
5,104.0
4,926.7
Volume of finished goods and base oil sold (in million liters)
596.7
644.0
665.5
The information in the table below presents a reconciliation of EBITDA, a non-IFRS financial measure, the most directly comparable IFRS Accounting Standards financial measure. Our calculation of EBITDA may differ from the calculation of similarly titled measures used by other companies. Our management believes that disclosure of EBITDA is useful as a supplemental measure for evaluating our operating performance and that EBITDA is also useful in allocating resources across our business segments, as it eliminates the impact of financing, tax, and depreciation/amortization variations. However, EBITDA is not a measure under IFRS Accounting Standards and should not be considered in isolation or as a substitute for net income or operating income prepared in accordance with IFRS Accounting Standards.
(Loss) Profit for the Year
(+) Income taxes
2,203.1
3,190.5
274.4
(+) Finance results, net
7,791.4
8,749.7
7,897.0
(+) Depreciation and amortization
EBITDA
The information in the table below presents a reconciliation of Net Debt, a non-IFRS financial measure, the most directly comparable IFRS Accounting Standards financial measure. Our calculation of Net Debt may differ from the calculation of similarly titled measures used by other companies. Our management believes that disclosure of Net Debt is useful to potential investors as it helps to give them a clearer understanding of our financial liquidity. Net Debt is also used to calculate certain leverage ratios and compliance with covenants. However, Net Debt is not a measure under IFRS Accounting Standards and should not be considered as a substitute for measures of indebtedness determined in accordance with IFRS Accounting Standards.
Current loans, borrowings and debentures
3,918.7
4,403.1
4,882.4
Non-current loans, borrowings and debentures
60,308.4
62,052.3
52,022.3
Total
(27,243.7
(16,903.5
(14,658.5
Current marketable securities
(2,588.4
(3,272.9
(3,407.9
Noncurrent marketable securities
(404.2
(113.4
(96.0
(30,236.3
(20,289.8
(18,162.5
Debt financial instruments
This section is intended to be a summary of a more detailed discussion contained elsewhere in this annual report. Our business, financial condition or results of operations could be materially and adversely affected by any of the risks and uncertainties described below. As a result, the market price of our common shares and ADSs could decline, and you could lose all or part of your investment. Additional risks not presently known to us, or that we currently deem immaterial, may also impair our financial condition and business operations.
Summary of Risk Factors
The following summarizes the principal factors that make an investment in our company speculative or risky, all of which are more fully described in the Risk Factors below. This summary should be read in conjunction with the Risk Factors below and should not be relied upon as an exhaustive summary of the material risks facing our business. The following factors could result in harm to our business, reputation, revenue, financial results, and prospects, among other impacts:
Summary of Risks Related to Our Businesses and the Industries in Which We Operate Generally
Summary of Risks Related to the Countries in Which We Operate
Summary of Risks Related to Our American Depositary Shares (“ADS”) and Our Common Shares
Risks Related to Our Businesses and the Industries in Which We Operate Generally
Economic, political and other conditions, as well as governmental measures, may adversely affect our business, results of operations and the market price of our securities.
The Brazilian economy has been characterized by frequent and, at times, extensive interventions by the Brazilian government, as well as unstable economic cycles. The Brazilian government has frequently modified its monetary, fiscal, credit, tariff and other policies to influence the performance of the economy. In the past, governmental measures to control inflation have included wage and price controls, restrictions on access to bank accounts, exchange controls and import restrictions. We cannot control or predict which policies or actions may be adopted by the Brazilian government in the future.
Our business, financial performance and prospects, as well as the market prices of our securities, may be adversely affected by the following factors, among others:
In addition, we have costs and revenues denominated in both reais and U.S. dollars. As a result, our operating margins may be adversely affected by changes in the exchange rate between these currencies, or between the real and any other currency used in countries where we operate. Furthermore, we have indebtedness indexed to both fixed and floating interest rates and are therefore exposed to interest rate volatility. If interest rates rise, our financial results may be adversely affected.
Inflation and the governmental measures taken to control it may negatively affect the Brazilian economy and the securities markets, as well as our business and operations. According to the General Market Price Index (Índice Geral de Preços – Mercado, or “IGP-M”), the inflation rate in Brazil was 5.45% in 2022, followed by deflation of 3.2% in 2023, inflation of 6.5% in 2024 and a decrease of 1.0% in 2025. In addition, inflation rates measured by (i) the Broad National Consumer Price Index (Índice Nacional de Preços ao Consumidor Amplo, or “IPCA”), published by the IBGE, were 4.5% in 2020, 10.1% in 2021, 5.8% in 2022, 4.6% in 2023, 4.8% in 2024 and 4.3% in 2025; and (ii) the SELIC interest rate (Sistema Especial de Liquidação e de Custódia, or “SELIC”), managed by the Central Bank of Brazil, was 2.81% in 2020, 4.81% in 2021, 12.63% in 2022, 13.25% in 2023, 10.92% in 2024 and 14.9% in 2025.
Governmental measures to combat inflation have frequently included the adoption of a restrictive monetary policy with high interest rates, thereby limiting access to credit and reducing economic growth. Inflation, related governmental measures, and speculation about possible additional measures have significantly contributed to economic uncertainty in Brazil and increased volatility in the Brazilian capital markets. Brazil may experience high rates of inflation in the future, as it has in the past. Periods of higher inflation may reduce the growth rate of the Brazilian economy, which could reduce demand for our products and decrease our net sales. Inflation may also increase certain of our costs and expenses, and we may not be able to pass these cost increases on to our customers, thereby reducing our profit margins and net income. In addition, high inflation rates generally lead to increases in domestic interest rates, which may raise the cost of our floating rate indebtedness denominated in reais, resulting in reduced net income. Inflation and its impact on domestic interest rates may also reduce liquidity in the Brazilian capital and financial markets, affecting our ability to refinance indebtedness in these markets.
Any reduction in our net sales or net income, or deterioration in our financial performance, may also lead to a decline in the market price of our securities.
Instability resulting from any changes in government policies or regulations that affect the foregoing or other factors in the future may contribute to economic uncertainty in Brazil and increase the volatility of the Brazilian securities market and of securities issued abroad by Brazilian companies.
Our significant indebtedness, or that of our investees, may negatively affect our financial condition, reduce our ability to raise funds, and impair our results of operations.
The level and composition of our indebtedness, or that of our investees, may materially affect our operations. For example, it may: (i) require us to allocate a substantial portion of our cash flows to service principal and interest on our debt, thereby reducing funds available for working capital, capital expenditures, acquisitions and investments; (ii) limit our ability to plan or respond to changes in our business and in the industries in which we operate; (iii) limit our ability to raise additional funds, obtain bank guarantees or collateral insurance, and generally increase our borrowing costs; (iv) place us at a competitive disadvantage compared to competitors with lower levels of indebtedness; and (v) increase our vulnerability to adverse general economic conditions and to those affecting our industry, including changes in interest rates or a slowdown in our businesses or in the economy as a whole. We cannot assure you that we will be able to refinance our debt on satisfactory terms or at all.
In addition, certain of our investees may, as a result of internal or external factors, including adverse market conditions, liquidity constraints, leverage levels, macroeconomic variables, or challenges specific to their respective industries, experience situations of financial distress, which may include restructuring processes, out of court reorganization, or court supervised reorganization proceedings, in accordance with applicable law.
In cases of court supervised or out of court reorganization, there can be no assurance that such proceedings will be successful, and they may result in dilution of equity interests, deferral or reduction of payments, restrictions on dividend distributions, loss of control, operational disruptions or, ultimately, bankruptcy of the respective investee, any of which could have material adverse effects on us.
In this regard, on March 11, 2026, we publicly disclosed that our joint venture Raízen had filed a request for an out of court reorganization (recuperação extrajudicial) before the courts of the State of São Paulo. The out-of- court reorganization presented by Raízen and certain of its subsidiaries is limited in scope to specific financial obligations of those entities and does not involve our obligations, operations, capital structure, or financial position, nor those of our direct or indirect subsidiaries.
Our growth through acquisitions, strategic alliances, investments and divestitures may involve risks that could reduce the anticipated benefits of such transactions.
We have expanded substantially through acquisitions and may enter into strategic alliances to enhance our competitiveness in the markets in which we operate. Despite this expansion, management cannot predict whether or when any new acquisition, divestiture, or strategic alliance will occur, or the likelihood that any specific transaction will be completed on favorable terms. Our ability to continue expanding through acquisitions or alliances depends on various factors, including our ability to identify suitable opportunities and access capital markets on acceptable terms. Even if we identify suitable opportunities and obtain the necessary resources, we may become financially overextended.
Acquisitions, particularly of large businesses, may involve financial, managerial and operational challenges, including diverting management’s attention from existing operations as well as difficulties integrating operations and personnel. Our failure to successfully integrate acquired businesses or manage new alliances may adversely affect our business and financial performance. Some of our principal competitors may also be pursuing growth through acquisitions and alliances, which may reduce our ability to implement these transactions successfully. Acquisitions may also increase our exposure to liabilities of the acquired business, including pre-existing legal or administrative proceedings or other claims. The due diligence review conducted prior to an acquisition, and any contractual guarantees or indemnities obtained from sellers, may not be sufficient to protect or compensate us for actual liabilities. Material liabilities associated with an acquisition, including labor or environmental liabilities, may adversely affect our reputation and financial performance, reducing the expected benefits of the transaction.
Moreover, acquisitions may be subject to antitrust or other regulatory approvals, and we may not be able to obtain these approvals in a timely manner or on terms acceptable to us, or at all.
We may also pursue future growth opportunities through the acquisition or development of greenfield projects, which we may be unable to complete or may not complete in a timely manner, and which may not yield the expected benefits. Our greenfield projects require the engagement of numerous service providers. Any failure to engage qualified service providers capable of delivering the required technical services could prevent us from completing planned projects or facility expansions on schedule. In addition, the integration of greenfield projects or facility expansions may result in unforeseen operational difficulties and may require significant financial and administrative resources that would otherwise be allocated to our current operations.
Similarly, any failure by us or our partners to perform obligations under strategic partnerships may require us to fulfill financial obligations beyond those expected, make additional investments, and/or provide additional services to ensure proper performance and service delivery. Fulfilling these obligations may reduce our profits and/or result in material losses. If we are unable to maintain existing partnerships or identify new ones, or if our strategic partnerships are unsuccessful, our business, financial condition, and results of operations may be materially and adversely affected.
We may also engage in partial or full divestitures of assets, subsidiaries, or affiliates for purposes such as generating cash, reallocating capital, and focusing on strategic assets. However, such transactions are subject to risks such as difficulty in finding buyers, adverse market conditions, regulatory requirements, and complex negotiations. There is no assurance that divestitures will be completed on the expected terms, and any delay or cancellation could affect our liquidity and the execution of our strategic plans. In addition, even when completed, divestitures may result in accounting losses, the recognition of previously unidentified liabilities, or reputational impacts—especially for high-profile assets.
Furthermore, asset sales may adversely affect us if the proceeds are not efficiently used or if the divestiture results in the loss of operational synergies, technical know-how, or market share. Depending on the volume and nature of divestitures, such effects may materially and adversely impact our business, financial condition, and results of operations.
A reduction in our equity interest in, or the loss of significant influence over, Investees may limit our ability to participate in the strategic, operational, or financial decision‑making processes of such businesses, reduce the realization of synergies, affect the consolidation of financial results and, as applicable, result in accounting losses, reduced dividend distributions, or deterioration in the value of our investments.
In addition, in the context of our capital allocation strategy and portfolio management, we may evaluate alternatives for the monetization or reorganization of significant equity interests, including, among others, potential initial public offerings of our certain of investees. The execution of an initial public offering involves significant uncertainties regarding its effective implementation, timing, structure, market valuation, level of investor demand, and general capital market conditions, all of which are subject to factors beyond our control, such as macroeconomic volatility, liquidity conditions, the regulatory environment, sector risk perception, and geopolitical factors.
We are a holding company and depend on the results of our subsidiaries and investees, which may not be distributed to us, and this could materially and adversely affect our financial results.
We are a holding company, and our cash flow consists almost exclusively of distributions from our subsidiaries, affiliates and investees in the form of dividends.
Our financial results and our ability to distribute earnings to our shareholders depend on the operations, cash flow and earnings of our subsidiaries and investees, as well as their ability to provide cash to us in the form of interest on equity, dividends or debt repayments, among others, which may be subject to restrictions under financing agreements, loan covenants or securities issuances that limit the distribution of dividends to us. Any change in Brazilian tax legislation that introduces the taxation of dividends distributed by our subsidiaries and investees may significantly reduce the net amount received by the Company. In addition, risks materializing at the level of our investees may negatively affect their performance and results of operations.
Accordingly, there can be no assurance that earnings from our subsidiaries or investees will be distributed to us or that the net amount of such distributions will not be reduced by taxes, and this could materially adversely affect our financial results and impair our ability to pay dividends to our shareholders.
Changes in tax legislation or interpretations by administrative or judicial authorities may increase our tax burden and adversely affect our financial results.
The Brazilian government, at the federal, state, and municipal levels, frequently implements changes to applicable tax regimes, modifying the tax burdens applicable to us, our subsidiaries, and our jointly controlled entities, as well as to our customers. Such changes may include amendments to tax rates, tax bases, calculation rules, taxable events, tax incentives or exemptions, or the creation of new taxes.
In addition, due to the high level of complexity of the Brazilian tax system, the interpretation and application of certain tax rules may be subject to review by administrative authorities and the judiciary, which may result in tax assessments, contingencies, litigation, or an increase in our effective tax burden, with adverse effects on our results.
With respect to consumption taxes, Constitutional Amendment No. 132/2023 and Complementary Law No. 214/2025 were enacted, implementing a broad reform of the Brazilian tax system by replacing existing taxes, such as ICMS, IPI, ISS, PIS, and COFINS, with new broad-based taxes: the Tax on Goods and Services (Imposto sobre Bens e Serviços), the Contribution on Goods and Services (Contribuição sobre Bens e Serviços), and the Selective Tax (IS).
The implementation of this reform will occur gradually, with a transition period beginning in 2026, full implementation of the CBS in 2027, and of the IBS in 2033. This reform may require significant operational, systems, and contractual adaptations and may affect the effective tax burden applicable to different activities carried out by us and our Investees. It is not possible to predict how the new legislation will be interpreted, applied, or possibly amended, nor to accurately estimate its effects on our business, financial condition, and results of operations.
With respect to income taxation, Law No. 15,270/2025 was enacted on November 26, 2025, introducing taxation on dividends paid, credited, delivered, allocated, or remitted to beneficiaries resident or domiciled outside Brazil. As of January 1, 2026, such dividends have become subject to withholding income tax at a rate of 10%, subject to statutory exceptions, including a transitional rule applicable to profits earned through fiscal year 2025, provided that the requirements set forth in such law are met.
The same law also introduced changes to the taxation applicable to individuals resident in Brazil, including the imposition of withholding income tax at a rate of 10% on profits and dividends paid by the same legal entity to the same individual resident when the total amount distributed in a given month exceeds R$50,000.00, without any deductions, as well as the creation of a minimum taxation regime applicable to high‑income taxpayers.
In addition, Complementary Law No. 224/2025 amended the tax regime applicable to interest on equity (juros sobre o capital próprio), establishing that, as of January 1, 2026, payments made to non‑resident shareholders are subject to withholding income tax at a rate of 17.5%, or 25% if the beneficiary is domiciled in a low‑tax or no‑tax jurisdiction.
There can be no assurance that legislative, regulatory, or judicial changes, including those resulting from the consumption tax reform or from the taxation of dividends and interest on equity, will not result in material adverse effects on our business, results of operations, and financial position. In addition, the modification, suspension, cancellation, or non‑renewal of tax benefits or incentives currently available to us or our investees could have a material adverse impact on us.
We may not be successful in obtaining required approvals on a timely basis or at all.
We may explore growth opportunities in the future through the acquisition or development of greenfield projects or through the expansion of our existing facilities. We may be unable to complete these projects on a timely basis or at all, and may not realize the related benefits we anticipate. Our greenfield projects and/or expansion of existing facilities require a significant number of service providers. Any inability on our part to enter into contracts with duly qualified service providers who are able to provide the technical services that we require may prevent us from completing our greenfield projects and/or expansions of existing facilities on a timely basis, or at all. In addition, the integration of greenfield projects or expansion of our existing facilities may result in unforeseen operating difficulties and may require significant financial and managerial resources that would otherwise be used for our current operations. Any failure by us or our partners to perform obligations under strategic partnerships may result in financial obligations beyond those expected for additional investments and/or material losses. Furthermore, if we are unable to maintain existing partnerships or identify new ones, or if our businesses or strategic partnerships are unsuccessful, our business, financial condition and operating results may be materially and adversely affected.
We may also consider partial or full divestitures of assets, subsidiaries or affiliates to generate cash, reallocate capital and focus on strategic assets. However, such transactions are subject to risks, including difficulty in finding buyers, adverse market conditions, antitrust approvals, regulatory requirements and complex negotiations. There is uncertainty regarding the completion of divestitures on expected terms, and delays or cancellations may affect our liquidity and execution of strategic plans. Additionally, even when completed, divestitures may result in accounting losses, recognition of previously unidentified liabilities or reputational impacts – especially in the case of high-profile assets. Moreover, if the proceeds from divestitures are not efficiently used, or if the divestiture leads to loss of operational synergies, technical knowledge or market share, these effects may materially and adversely impact our business, financial condition and operating results.
The ongoing war between Russia and Ukraine, the conflict involving Iran, Israel, and the United States, other conflicts in the Middle East, and other international crises may have a material adverse effect on the global and Brazilian economies, as well as on us.
Russia’s invasion of Ukraine on February 24, 2022, marked the beginning of an ongoing war between the two countries, which has materially affected the global economy and international relations. The conflict has already caused significant responses from the United States, the United Kingdom, the European Union (“EU”), and other countries around the world, notably the members of the North Atlantic Treaty Organization (“NATO”), which have imposed broad economic sanctions against Russia, including financial and trade measures. The United States, the EU, and the United Kingdom have taken measures against Russian businesses and governmental entities, the Central Bank of Russia, and others, including sanctioning individuals with close ties to the Russian president, imposing visa restrictions on several oligarchs, along with their family members and close associates, and blocking or freezing assets. In addition, several countries have already provided support to Ukraine by supplying financial resources, weapons and equipment, and other humanitarian aid, which could lead to the internationalization of the conflict.
The war has already resulted in significant volatility in global financial markets, depreciation of the Russian ruble and the Ukrainian hryvnia against the U.S. dollar and other currencies, and rising energy and commodity prices around the world. Russia remains subject to severe international sanctions, including restrictions affecting the energy and technology sectors, while Ukraine continues to receive military and financial support from Western nations. Despite diplomatic efforts involving the United States and the European Union, the conflict continues without a clear prospect of resolution, posing persistent risks of escalation and prolonged effects. If the conflict persists or intensifies, global financial markets may face continued volatility, as well as economic and security consequences, including but not limited to supply shortages of various products, further increases in commodity prices, such as piped natural gas, oil, and grains, and higher energy and food prices.
In addition, on October 7, 2023, Hamas launched an attack on Israel, killing hundreds of civilians. In response, Israel declared war against Hamas, targeting the Gaza Strip. Despite the cease-fire that entered into effect on October 10, 2025, negotiations remain at an impasse, as reports of bilateral military actions have emerged, testing the fragility of the agreement and resulting in significant international pressure on both parties to uphold their respective commitments.
The armed conflict involving Iran, Israel, and the United States entered its most recent phase on February 28, 2026, when Israel and the United States reportedly launched large-scale military attacks against Iran. In addition, indirect confrontations involving extremist groups such as Hezbollah in Lebanon and the Houthis in Yemen have further escalated regional tensions. The Middle East includes critical logistical routes for global trade and holds a substantial share of the world’s oil and natural gas reserves. As a result, the escalation of hostilities has contributed to increased inflationary pressures and heightened market volatility, as evidenced by the sharp rise in energy prices following the onset of the military offensives. In this context, operating costs may increase significantly, placing upward pressure on logistics chains, raw materials, and intermediate goods.
Furthermore, on January 3, 2026, a military operation by the United States reportedly resulted in the arrest of Venezuela’s former president. This intervention generated significant international repercussions.
Potential consequences of such conflicts for us may include, without limitation:
The effects of the war between Russia and Ukraine, the conflict between Hamas and Israel, the recent conflict involving Iran, Israel, and the United States, and the U.S. military intervention in Venezuela are ongoing, and their continuation or escalation could precipitate or aggravate the other risk factors identified in this annual report, which in turn could further materially and adversely affect our business, financial condition, liquidity, results of operations, and profitability, including in ways not currently known or considered by us to present material risks. In particular, the oil and gas, lubricants, and fuel distribution sectors in which we operate primarily through Raízen, Compass, and Moove may be significantly affected by these conflicts.
Other international crises of a similar nature may further escalate tensions and increase the scale of these conflicts. As a result, there may be significant impacts on the prices of products and services in global markets, on the economic conditions of certain countries, on international trade flows, on the supply chains of affected countries, or on product availability. Our business, financial condition, and results of operations may be materially and adversely affected as a result.
We may engage in hedging transactions which could have a material adverse effect on our results.
We are exposed to market risks arising from the conduct of our business activities—in particular, market risks arising from changes in commodity prices, exchange rates or interest rates. In an attempt to minimize the effects of the volatility of prices and exchange rates on our cash flows and results of operations, for example, we engage in hedging transactions involving commodities and exchange rate futures, options, forwards and swaps. We also engage in interest rate-related hedging transactions from time to time. These transactions expose us to the risk of financial loss. In particular, Raízen enters into hedging transactions against market price fluctuations by fixing the prices of our sugar export volumes and exchange rates. Any fluctuations in market prices could therefore have a material adverse effect on our business, financial condition and results of operations. Alternatively, we may choose not to engage in hedging transactions in the future, which could have a material adverse effect on our financial performance during periods in which commodities’ prices decrease.
Climate change can create transition risks, physical risks and other risks that could adversely affect us.
Climate risk is a transversal risk that can be an aggravating factor for the types of traditional risks that we manage in the ordinary course of business, including without limitation the risks described in this “Risk Factors” section. Based on the classifications used by Task-Force on Climate-Related Financial Disclosures, we consider that there are two primary sources of climate change-related financial risks: physical and transition.
Physical risks resulting from climate change can be event-driven (acute) or long-term shifts (chronic) in climate patterns. Acute physical risks include increased severity of extreme weather events, such as drought, hurricanes, floods, or wildfires. Chronic physical risks include changes in precipitation patterns and extreme variability in weather patterns, rising mean temperatures, chronic heat waves or rising sea levels.
Especially in Brazil, rainfall patterns have been constantly changing, causing certain regions to experience precipitation levels significantly above historical averages, resulting in floods and landslides in hillside and mountainous areas. Such changes in rainfall patterns may have an adverse effect on our production and distribution capabilities, impacting crop yields, as well as our ability to produce sugar and ethanol, generate energy, distribute our products and provide services to our customers. The occurrence of storms and floods may also influence the cost to insure our assets, especially those in high-risk regions, where storms, tornadoes and other extreme events are more pronounced. In periods of scarcity of rain, water deficiency occurs because of the decrease in the levels of water reservoirs, with an influence on the availability and costs of electric energy, considering the dependence on energy generated through hydroelectric plants, as well as on crop harvests.
The scarcity of rain combined with low levels of reservoirs can lead governments and authorities to restrict industrial activities and direct water for human consumption. The increase in average temperatures may have an impact on our operating costs due to the greater demand for cooling and air conditioning to produce, store and transport some of our products. Historically, in periods of water scarcity, the Brazilian government authorizes an increase in energy prices as a measure to stimulate the reduction of consumption, which can create inflationary pressure, with impacts on the income levels of the population in general, on production costs and on the final price of products, which consequently affects our revenues and results.
Extreme and prolonged changes in rainfall patterns and an increase in temperatures can influence production cycles in certain regions, and droughts can influence the increase in fires and devastation, which may adversely affect our facilities. Additionally, they can also cause a reduction in revenue and an increase in costs due to negative impacts on our employees and suppliers, such as increased absenteeism and issues involving health and safety.
In May 2024, the State of Rio Grande do Sul, located in the southern part of Brazil, was impacted by extreme weather leading to severe floods that caused damage to the region’s railway assets, significantly disrupted logistics in the region and caused damage to the “Malha Sul” network operated by Rumo which resulted in a material adverse effect on Rumo. In the fiscal year ended December 31, 2025, Rumo Malha Sul identified persistent impairment indicators, fully recognizing the impairment loss on assets related to the railway concession, in the total amount of R$1,227.9 million for the fiscal year ended December 31, 2025. The extent of the damage raises uncertainties about the process of renewing the concession which is scheduled to expire in February 2027.
During the flooding period in the State of Rio Grande do Sul, Sulgás, a direct subsidiary of Compass and our indirect subsidiary, was mostly able to maintain a regular supply of natural gas to the region, but as a safety measure, it suspended the supply intermittently to approximately 2.0% of its customers.
The impact of climate change poses tangible physical risks to the operations of certain of our subsidiaries, as follows:
These requirements may increase going forward as a result of the increasing importance of environmental matters, which could expose us to increased compliance costs and limit our ability to pursue certain business opportunities and provide certain products and services, each of which could adversely affect our business, financial condition and results of operations.
The impact of climate change poses tangible transition risks to the operations of certain of our subsidiaries, as follows:
We may face conflicts of interest in transactions with related parties.
We engage in business and financial transactions with our controlling shareholder and other shareholders that may create conflicts of interest between our Company and these shareholders. Commercial and financial transactions between our affiliates and us, even if entered into on an arm’s-length basis, create the potential for, or could result in, conflicts of interest. See “Major Shareholders and Related Party Transactions—B. Related Party Transactions.”
Technological advances could affect demand for our products and services or require substantial capital expenditure for us to remain competitive.
The development and implementation of new technologies may result in a significant reduction in the costs of the products and services we provide. We cannot predict when new technologies may become available, the rate of acceptance of new technologies by our competitors or the costs associated with such new technologies. Advances in the development of alternatives to the products and services which we currently sell could significantly reduce demand or eliminate the need for them.
For example, the development of alternative products to sugar, ethanol and natural gas may reduce the demand for our products or materially reduce the demand for ethanol or natural gas to be used as a source of energy, and the use of alternative sweeteners may adversely affect the overall demand for sugar in Brazil and abroad, which could have a material adverse effect on our business, financial condition and results of operations.
Any advances in technology which require significant capital expenditure to remain competitive, or which otherwise reduce demand for our products and services, will have a material adverse effect on our business and financial performance. Any other alternative products or technological advances which reduce demand for the products of our subsidiaries and joint ventures may have a material adverse effect on our results of operations and financial condition.
We rely on our information technology systems to conduct our business. Any failure in these systems may adversely affect us and expose us to cyber threats.
We depend on information technology systems for significant elements of our operations, including the storage and retrieval of critical business information. Our information technology systems are vulnerable to damage from a variety of sources, including network failures, malicious human acts, and natural disasters. Moreover, despite network security and backup measures, some of our servers are potentially vulnerable to physical or electronic breaches, computer viruses, and similar disruptive problems. Failures or significant disruptions to our information technology systems or those used by our third-party service providers could prevent us from conducting our general business operations. Any disruption or loss of use information technology systems on which critical aspects of our operations depend could have an adverse effect on our business, results of operations, and financial condition.
Furthermore, we store highly confidential information on our information technology systems, including information related to our products. If our servers or the third-party servers on which our data is stored are compromised by a physical or electronic breach, computer virus or other malicious human action, our confidential information could be stolen or destroyed. Any security breach involving misappropriation, loss or other unauthorized disclosure or use of confidential information of our suppliers, customers, or others, whether by us or a third party, may (i) subject us to civil and criminal penalties; (ii) adversely impact our reputation; (iii) expose us to liability to our suppliers, customers, other third parties or governmental authorities; or (iv) have an adverse impact on our business, financial condition and results of operations.
In addition, any failure of our information technology systems to operate effectively or integrate with other systems, or inadequate performance of, or security breaches involving, such systems could result in interruptions in the availability of our online resources, delays in delivering products or services and reduced efficiency in our operations. Each of these factors may adversely affect our business, as well as its financial condition, results of operations and reputation. We also hold certain highly confidential personal and financial data relating to our customers in our information technology systems. Any failures in the information technology systems on which we depend or any breaches resulting in the unauthorized disclosure of the personal or financial data of our customers may adversely affect our business, financial condition, results of operations and reputation.
The international geopolitical environment has been characterized by heightened tensions among major powers and by the escalation of regional conflicts, which have been accompanied by an increased risk of cyber incidents attributed to state actors or groups associated with nation-states. Public reports by governmental authorities and global technology companies indicate that companies based in the United States or that provide technology services on a global scale, including major software providers, cloud platforms, and digital infrastructure solution providers, have increasingly been targeted by sophisticated cyber campaigns. Such campaigns may involve espionage, sabotage, service disruptions, or information influence operations, particularly in contexts of geopolitical retaliation or international conflict.
In this context, any escalation of cyberattacks targeting globally used technology vendors, as a form of retaliation or counterattack attributed to countries such as Iran, Russia, China, or other nation-states, may result in indirect adverse impacts on us and our Investees, even if we or our Investees are not the primary targets of such attacks. These impacts may include, among others, service disruptions, performance degradation, temporary unavailability, or compromise of the integrity of systems, applications, cloud environments, or third-party services upon which critical operations depend, as well as limitations on technical support, vulnerability remediation, or the continuity of contracted services.
There can be no assurance that large-scale cyber incidents can be fully detected, prevented, or mitigated, nor that their effects can be effectively contained, particularly those arising from advanced persistent threats, the use of artificial intelligence, or coordinated attacks across global technology supply chains. The occurrence of any such risk could result in material adverse effects on our operations, operational efficiency, data integrity, reputation, financial results, and financial condition, as well as on those of our Investees, in addition to potential regulatory, contractual, or legal liabilities, in accordance with applicable laws and regulations.
We face various cybersecurity risks, including but not limited to penetration of our information technology systems and platforms by malicious third parties, infiltration of malware (such as computer viruses) into our systems, compromise (whether intentional or accidental) of our networks and systems by third parties with whom we exchange data, unauthorized access to confidential customer or proprietary data by persons inside or outside our organization, cyberattacks causing systems degradation or service unavailability that may result in business losses, and risks associated with the use of emerging technologies such as artificial intelligence. In addition, we may be subject to potential fraud and theft by cybercriminals, who are becoming increasingly sophisticated, seeking to gain unauthorized access to or exploit weaknesses that may exist in our systems.
We cannot assure you that our information technology systems will not be attacked in the future, or that we will be able to adequately protect the confidential information we maintain. In March 2020, our subsidiaries and jointly controlled companies suffered a ransomware cyberattack that caused a partial and temporary interruption of our operations. If we are the victim of successful cyberattacks or experience cybersecurity incidents in the future, we could incur substantial costs and suffer other negative consequences, such as: remediation costs (liabilities for stolen assets or information or repair of system damage, among others); increased cybersecurity protection costs; lost revenue from unauthorized use of proprietary information or the failure to retain or attract customers after an attack; litigation and legal risks; increased insurance premiums, reputational damage affecting the trust of our customers and investors; and damage to our competitiveness, stock price, and long-term shareholder value. Any failure by us to adequately protect our information technology systems and the confidential data that we hold could have a material adverse effect on our business, financial condition and results of operations. Importantly, even when a failure or disruption to our systems or facilities is resolved in a timely manner or an attempted cyber incident or other security breach is successfully prevented, substantial resources are typically expended to do so, and we may be required to take actions that could negatively affect customer satisfaction or behavior and could pose a threat to our reputation.
See “Item 16K. Cybersecurity” for additional information regarding our cybersecurity risk management.
Concerns relating to the responsible use of new and evolving technologies, such as Artificial Intelligence (AI), may result in reputational, operational or financial harm and liability.
While providing significant benefits, AI poses emerging legal, social, and ethical issues and presents risks and challenges. If we utilize AI solutions that have unintended consequences or which may be deemed controversial, or if we are unable to develop effective internal policies and frameworks relating to the responsible use of AI, we may experience brand or reputational harm, competitive harm or legal liability. Further, bad actors around the world use increasingly sophisticated methods, including the use of artificial intelligence, to engage in illegal activities involving the theft and misuse of personal information, confidential information, and intellectual property, as well as to create and disseminate fake news and deepfakes (videos or audios falsified in a realistic way). Any of these outcomes could damage our and our employees’ reputations as well as result in the loss of valuable property and information and adversely impact our business.
In addition, it is possible that AI and machine learning technology could, unbeknownst to us, be improperly utilized by employees while carrying out their responsibilities. The use of AI can lead to unintended consequences, including the unauthorized use or disclosure of confidential and proprietary information, or generating content that appears correct but is factually inaccurate, misleading, or otherwise flawed, which could harm our reputation and business and expose us to risks related to inaccuracies or errors, system downtime, erroneous disclosures to the market, technical failure and/or cyberattacks. It is not possible to predict all of the risks related to the use of AI, machine learning and automated decision making, and developments in the regulatory frameworks governing the use of such technologies and in related stakeholder expectations may adversely affect our ability to develop and use such technologies or subject us to liability.
Failure to comply with the Brazilian General Data Protection Law may adversely affect our business.
Until the enactment of Law No. 13,709/2018, or the Brazilian General Data Protection Law (Lei Geral de Proteção de Dados Pessoais), or the “LGPD,” the processing of personal data in Brazil was regulated by a series of rules scattered throughout legislation such as the Brazilian Federal Constitution, Law No. 8,078/1990, or the Consumer Protection Code (Código de Defesa do Consumidor), and the Brazilian Civil Framework for the Internet (Marco Civil da Internet). The LGPD, which came into force on September 18, 2020, regulates practices related to the processing of personal data in Brazil through a system of rules that impacts all sectors of the economy and establishes, among other measures, protection rights for the holders of personal data. In cases where the processing of personal data is permitted through legal basis, there are obligations and requirements related to information security incidents, such as personal data breach and irregular transfer of personal data, as well as sanctions for noncompliance with the law. In addition, the LGPD authorized the creation of the National Data Protection Authority (Autoridade Nacional de Proteção de Dados), or ANPD, which is responsible for developing guidelines and applying administrative sanctions in case of noncompliance with the LGPD. The administrative sanctions provided for in the LGPD (art. 52, 53 and 54) came into effect on August 1, 2021, under Regulation No. 10/2020; if we are not in compliance with the LGPD, we will be subject to the following sanctions, in isolation or cumulatively: (i) a warning, with an indication of the deadline for adopting measures; (ii) fines of up to 2% of the revenue of the group’s last fiscal year, excluding taxes, up to an overall amount of R$50 million per violation; (iii) daily fines up to the limit referred to in item B; (iv) an incident disclosure obligation; (v) temporary blocking and/or deletion of personal data; (vi) partial suspension of the database to which the infraction relates for a period of up to six months, extendable for the same period, until the personal data processing is regularized; (vii) suspension of the exercise of the personal data processing activity to which the infraction relates for a period of up to six months, extendable for the same period; and (viii) partial or total prohibition from exercising activities related to data processing.
In addition to administrative sanctions, failure to comply with any provisions set forth in the LGPD has the following risks: (i) the filing of legal, individual or collective claims seeking compensation for damages arising from violations, based not only on the LGPD, but on sparse and sectorial legislation on data protection; and (ii) the application of penalties set forth in the Consumer Protection Code and in the Brazilian Civil Framework for the Internet by some consumer protection agencies, which have already acted in this regard even before the enactment of the LGPD and the effective structuring of the ANPD, particularly in cases involving security incidents resulting in personal data breaches.
Therefore, failures in the protection of personal data processed by us as well as failure to comply with the applicable legislation, including those related to cybersecurity incidents and other events of failures in our information technology systems, may result in high fines, disclosure of the incident to the market, elimination of personal data from the base and even suspension of activities, resulting in costs that may have an adverse and negative effect on our reputation, results, the value of our ADSs and our common shares.
Our performance depends on maintaining functioning labor relations with our employees and our compliance with labor laws. Any deterioration of those relations or increase in labor costs could adversely affect our business.
All of our employees are represented by labor unions. Our relationships with these organizations are governed by labor agreements or collective bargaining agreements which we negotiate with labor unions. Upon the expiry of such agreements, we are required to renegotiate new agreements with the applicable labor union. As part of these renegotiations, new terms and conditions may be established. In certain cases, these agreements may not be renewed, which could lead to strikes and/or stoppages in our activities and have an adverse impact on our business, financial condition and results of operations. Furthermore, since the enactment of Law No. 13,467/2017, labor agreements and collective bargaining agreements prevail over certain provisions of labor legislation, as stated in items I to XV, of Article 611-A, of the Consolidation of Brazilian Labor Laws (Consolidação das Leis do Trabalho), such as working time arrangements and the manner in which these are recorded, work breaks, and certain employer-specific internal rules, among others. As a result, employers may expand or reduce certain labor rights, provided this is done pursuant to the terms of labor agreements negotiated with unions and/or individual agreements negotiated with the respective employees.
We may not be able to obtain or renew all licenses, permits and authorizations required to conduct our business and may be subject to regulatory penalties.
We are required to obtain specific licenses with respect to our terminals, plants, distribution centers and other operational units, which are required in connection with the emission, ejection and emanation of products and by-products resulting from our activities. We are also required to obtain specific licenses and permits from governmental authorities for rural producers to carry out certain of our operations.
The laws and regulations which govern these licenses may occasionally require us to purchase and install costly pollution control equipment or to make operational changes to limit our impact on the environment and/or the health of our employees. Any failure to comply with the terms of such laws, regulations, licenses and permits may result in significant financial penalties, criminal sanctions, revocation of operating licenses and permits, and/or the prohibition of certain of our activities. Moreover, we may not be able to renew licenses currently in effect or obtain new licenses required to operate new ventures, which could affect our results or impact the development of our business, growth and expansion plans.
In addition, we are subject to regulatory penalties in case of noncompliance with the terms and conditions of regulatory authorizations, including possible revocation of such authorizations. For example, Raízen operates in power generation under ANEEL regulations with authorizations ranging from 20 to 35 years. Noncompliance with these regulations may result in penalties such as warnings, fines, operational restrictions and even revocation of authorizations. In addition, the energy trading activities carried out by Raízen and Compass are also highly regulated and subject to changes in governmental policies and rules.
Furthermore, Raízen, a fuel distributor, and Moove, a lubricant manufacturer, operate under regulations established by ANP and are subject to sanctions that include fines ranging from R$5,000 to R$5 million, product confiscation and license revocation. There is no assurance that these companies will avoid penalties, which could negatively impact our business and financial results.
Contamination of our products and other related risks could adversely affect our reputation, leading to judicial and administrative proceedings and/or resulting in the closure of our production facilities.
Certain of our products may have adverse effects on consumers (including certain components, raw materials and supplies used to produce these products), including as a result of product contamination or subsequent errors in the production or distribution chain. Contamination of any of our products may result in a need for recalls or the beginning of legal and administrative proceedings against us, which may adversely affect our reputation, our business, the operation of our production facilities, our financial condition and our operating results. Any damage to our reputation could have a material adverse effect on us.
We are exposed to the possibility of losses related to natural disasters, catastrophes, accidents, fire, political, social and economic events and other events outside our control, which may have a material adverse effect on our business, financial condition and results of operations.
Our operations are subject to certain risks that affect our properties, facilities, railways, and inventory, including but not limited to: fire; explosions; leaks of fuel and other flammable products; other environmental events; cargo loss or damage to railroads, cargo loading, or unloading terminals; accidents; business interruptions due to political, social, or economic events (whether local or international); civil unrest, social movements, or other conflicts; labor claims; demonstrations by social or environmental groups or associations; strikes or work stoppages (of our own employees or of those linked to entities with which we have a relationship, such as port operators); disease outbreaks; pests; adverse weather conditions; and natural disasters, such as floods. These events may result in the loss of revenue, assumption of liabilities, or cost increases. We are also subject to stoppages and blockades of highways and other public roads. Such stoppages and blockades of highways, other public roads, railways, terminals, or other means of transportation may adversely affect our business and results of operations. Moreover, our operations may be periodically affected by crop shortfalls, landslides, and other natural disasters.
Our transportation and handling of cargo exposes us to risks relating to catastrophes, mechanical and electrical failures, collisions, and loss of assets. A portion of our freight activities involves petroleum products and other flammable materials, and the presence of such products may aggravate the effects of any catastrophe.
On February 8, 2025, a fire occurred in an industrial facility of Cosan Lubrificantes e Especialidades S.A. (“CLE”) at the Ilha do Governador Complex, or CIG, in Rio de Janeiro, Brazil. The incident primarily affected the manufacturing and packaging areas for finished lubricants, which were not in operation at the time of the incident. The affected area represented approximately 10% of CIG. Moove promptly activated all emergency and risk management protocols to control the incident. Moove maintains insurance policies covering material damage and business interruption losses. We recognized insurance recoveries for lost profits in the amount of R$933.7 million as other operating income; inventory losses in the amount of R$47.4 million were recognized in cost of sales; and insurance recoveries related to the write-off of damaged property, plant, and equipment in the amount of R$51.3 million were recognized as other operating income. As of December 31, 2025, the amount of insurance compensation received was R$500.0 million; the remaining R$433.7 million was received during January 2026 and was recognized as a subsequent event. See also “Item 4. Information on the Company—A. History and Development of the Company—History.”
As our insurance does not cover all potential risks and losses we may incur, the occurrence of a large-scale natural disaster, catastrophes, cyberattacks, pandemics, mechanical failures, loss of assets, or any other of the events referred to above, and any resulting damage to our business, may have a material adverse effect on our business, operating results, and financial condition, including as a result of civil, administrative, or criminal sanctions relating to environmental liability.
We are exposed to credit and other counterparty risks of our customers in the ordinary course of our business.
We have various credit terms with our industrial, wholesale and retail clients, who have varying degrees of creditworthiness. This exposes us to the risk of nonpayment or other default under our contracts and other arrangements with them. In the event that a significant number of material customers default on their payment obligations, our cash flows could be materially and adversely affected.
We and our investees are subject to restrictive covenants under financing agreements, and any failure to comply with such covenants could result in the acceleration of indebtedness, the enforcement of collateral and material adverse effects on our liquidity and results of operations and those of our Investees.
We are subject to certain restrictive covenants based on financial and non-financial indicators that are set forth in the majority of the indebtedness and financing agreements to which we are a party. The majority of such covenants relate to requirements to maintain certain predetermined leverage levels. A failure by us to comply with these restrictive covenants in our credit agreements may trigger: (i) the acceleration of the indebtedness due and payable under the applicable agreement; (ii) cross-default or cross-acceleration of these agreements; or (iii) the respective creditors electing to enforce any collateral granted under the applicable agreement. These scenarios may lead to the acceleration of a portion of our indebtedness, limit our access to new credit facilities, and adversely affect our business. A portion of our debt agreements and those of our investees contains cross-default or cross-acceleration clauses, pursuant to which the default, early maturity, or acceleration of a material financial obligation would trigger, automatically or at the discretion of creditors, the early maturity or acceleration of other obligations, even if arising from different agreements or entered into with different creditors. Such clauses are customary in corporate financing structures and are intended to protect creditors against a systemic deterioration in the credit risk of the debtor or its economic group, and they may result in financial contagion effects.
We may raise additional capital in the future which may result in a potential dilution of equity investors’ stake in our shares.
We may need additional funds in the future to implement our business strategy and may choose to raise them through the public or private placement of shares and/or other securities convertible or exchangeable into shares. Any such issuance of our securities may result in a decrease in the price of our common shares and/or ADSs and dilute our existing shareholders’ interests in our share capital. The raising of additional funds by means of the issuance of shares or securities convertible into shares may, under the terms of the Brazilian Corporation Law, be made to the exclusion of the preemptive rights of its shareholders, including investors in our shares, and may therefore dilute the financial investment of investors.
The insurance coverage for our businesses may not be sufficient to cover potential losses. We are not insured against business interruption of operations and most of our assets are not insured against war or sabotage.
Our operations are subject to a number of hazards and risks. We maintain insurance at levels that are customary in our industry to protect against these liabilities; however, our insurance may not be adequate to cover all losses or liabilities that might be incurred in our operations. We do not maintain insurance coverage for any type of business interruptions of operations, including business interruptions caused by work stoppages. If, for example, our workers were to strike, the resulting work stoppages could have a substantial and adverse effect on us. In addition, we do not insure most of our assets against war or sabotage. Therefore, an attack or an operational incident causing an interruption of our business activities could have a material and adverse effect on our performance. Moreover, we will be subject to the risk that we may not be able to maintain or obtain insurance of the type and amount desired at reasonable rates. If we were to incur a significant liability for which we were not fully insured, it could have a materially adverse effect on our business, financial condition and results of operations.
We are dependent on members of our management to develop and implement our strategy and to conduct our operations, and the loss of such individuals could adversely affect the execution of our strategy and the results of our business and of our Investees.
We rely on the capabilities and experience of several key executives who possess substantial expertise in our operations. These executives include key members of senior management and our Board of Directors. Many of these executives have been employed by us for a significant period or were hired due to their industry-specific experience. The loss of any individual key executive, or a combination of key executives, could have a negative impact on our business, financial performance, and operating results, as well as on those of our investees.
Our controlling shareholder group may take actions or measures that could affect our corporate governance and the value of the Company.
Our controlling group, led by our ultimate controlling shareholder, has the power to indirectly control the Company, including the power to:
Currently, because of our capital structure, our controlling group is able to control substantially all matters submitted to our shareholders for a vote or approval. The concentrated control will limit your ability to influence corporate matters and, consequently, we may take actions that our shareholders do not view as beneficial. Moreover, our controlling group may make decisions that are contrary to the interests of our other shareholders, particularly our minority shareholders. Such actions may include conducting acquisitions, divesting assets, engaging in new business partnerships, and engaging in new financings or similar transactions. As a result, the market price of our common shares and ADSs could be adversely affected.
We may not be able to access the capital markets and bank financing in significant volumes.
We rely on obtaining financing and refinancing of existing loans to operate our business, implement our strategy and grow our business. We need bank guarantees to obtain credit facilities, and we typically need insurance guarantees to participate in court proceedings to which we are a party.
Our ability to obtain funding to finance our growth or operate our business depends on several factors, including our level of indebtedness and market conditions. Substantial volatility in the global capital markets, high interest rates, high inflation, unavailability of financing in the global capital markets at reasonable rates, the ongoing banking crisis in the United States and Europe, and credit market disruptions have had a significant negative impact on financial markets, as well as on the global and Brazilian economies. In particular, the cost of financing in the global debt markets has increased substantially, restricting the availability of funds in such markets. Substantial volatility in the financial and capital markets, the unavailability of financing at reasonable rates, recent and ongoing increases in inflation and interest rates in Brazil and globally, and disruptions in the credit market and increasing inflation in Brazil and the world’s largest economies may have a significant negative impact on overall conditions for fundraising.
If we are unable to obtain new financing or refinance existing loans when required, obtain or renew insurance guarantees on reasonable terms or at all, we may not be able to honor our financial obligations or exploit business opportunities.
We may not be able to ensure that all of our commercial and contractual partners fully comply with our ethical guidelines, anti-corruption policy, and the applicable anti-bribery, antitrust, and anti-corruption laws in the countries where they operate.
As part of our business operations, we establish contractual relationships with third parties of various sizes and nationalities, including suppliers of materials, service providers, counterparties in energy trading, research and development institutions, and other stakeholders. We may not immediately detect all potential noncompliance with our code of conduct, compliance with anti-corruption practices, and the policies established for contract execution.
Additionally, our contracting processes may not be sufficient to ensure that these third parties and commercial partners do not face issues related to compliance with anti-bribery, antitrust, and anti-corruption laws in the jurisdictions where they operate.
Government policies and regulations affecting the sectors in which we operate may adversely impact our business, financial condition and results of operations.
Our business is subject to extensive laws and regulations. Laws, regulations and government policies in Brazil and elsewhere, in each case whether at the federal, state or local level, may adversely affect the supply and demand for, and prices of, our products or restrict our ability to do business in our existing and target markets, which could adversely affect our financial performance. Failure to comply with such laws, regulations and policies (including a failure to obtain or maintain relevant environmental permits, as well as to comply with technical conditions imposed by environmental permits) may subject the violator to administrative fines, mandatory suspension of operations and criminal sanctions, in addition to the obligation to remedy and pay compensation for environmental and third-party damages.
Agricultural production and trade flows are significantly affected by Brazilian federal, state and municipal, as well as foreign, government policies and regulations. Governmental policies affecting the agricultural industry, such as taxes, tariffs, duties, subsidies and import and export restrictions on agricultural commodities and commodity products, may influence industry profitability, the planting of certain crops versus others, the uses of agricultural resources, the location and size of crop production, the trading levels for unprocessed versus processed commodities, and the volume and types of imports and exports. In addition, pursuant to Brazilian law, the Brazilian government may expropriate the real estate of rural producers on which sugarcane is planted, for reasons of necessity, public utility, or social interest, either partially or totally. In the event of expropriation, we cannot assure you that the price paid by the Brazilian government will be fair or equal to fair market value, or that it will effectively and adequately compensate us for the amounts invested.
Our natural gas distribution operations are currently concentrated in the states of São Paulo and Rio Grande do Sul. Our activities are regulated by ARSESP, the State Agency for the Regulation of Delegated Public Services of the State of Rio Grande do Sul (Agência Estadual de Regulação dos Serviços Públicos Delegados do Rio Grande do Sul or “AGERGS”), and the Regulatory Agency for Delegated Public Services of the State of Paraná (Agência Reguladora de Serviços Públicos Delegados do Paraná or “Agepar”). Any changes affecting governmental policies and regulations regarding natural gas in these states (at the federal, state, or municipal level) may have a material adverse effect on our business, financial condition, and results of operations.
In addition, crude oil and petroleum products have historically been subject to price controls in Brazil. Currently, there is no legislation or regulation in force that grants the Brazilian government the authority to set prices for crude oil, petroleum products, ethanol, or vehicular natural gas. However, since Petrobras, the sole supplier of domestically produced oil-based fuels in Brazil, is a government-controlled company, the prices of crude oil and refined products are subject to government influence. This can result in potential inconsistencies between international and domestic oil prices, as well as refined product prices that impact our business and financial results. The privatization processes of fuel product refineries in Brazil may negatively affect our business if private investors acquire these assets and adopt more restrictive pricing and supply policies, limiting our access to refined products.
In February 2026, ARSESP enacted regulations governing the allocation of PIS and COFINS tax credits (Brazilian federal social contributions levied on gross revenues, namely the Social Integration Program (Programa de Integração Social) and the Social Security Financing Contribution (Contribuição para o Financiamento da Seguridade Social)) recovered through judicial or administrative proceedings by concessionaires, requiring the full reimbursement of such amounts to end users through the tariff mechanism. This regulation is consistent with the Brazilian Supreme Federal Court’s (Supremo Tribunal Federal, or “STF”) understanding that Tax on the Circulation of Goods and Services (Imposto sobre Circulação de Mercadorias e Serviços, or “ICMS”) should not be included in the tax base of such contributions.
The regulation establishes accounting segregation, traceability, audit, and reimbursement obligations with respect to the recognized amounts, thereby restricting the retention of the economic benefit of such tax credits by regulated concessionaires.
Uncertainties remain regarding the implementation framework, the definitive timeline, and the final financial impacts of these measures, considering ongoing technical, regulatory, and legal discussions. The principal potential impact for us and our investees relates to the piped natural gas segment, which may be adversely affected in terms of cash flows, regulatory predictability, and operating results.
The matter remains within the scope of state-level administrative and regulatory proceedings and may be subject to future challenges or revisions, which could have material adverse effects on us and our investees.
We are subject to extensive environmental regulations and may be exposed to liabilities in the event we fail to comply with these regulations.
Our business activities are subject to extensive laws and regulations concerning environmental protection, which impose on us various environmental obligations, such as environmental licensing requirements; standards for the release of effluents, management of solid waste, emission and discharge of hazardous materials, sugarcane burning and health and safety of our employees; protection of certain areas (including the Legal Reserve, areas of traditional indigenous and quilombolas communities, conservation units, archeological sites and permanent preservation areas); and the need for special authorizations for the use of water, among others.
Failure to comply with such laws and regulations (including a failure to obtain or maintain relevant environmental permits, as well as to comply with technical conditions imposed by environmental permits) may subject the violator to administrative fines, mandatory interruption of activities and criminal sanctions, in addition to the obligation to remedy and pay environmental and third-party damage compensation. In addition, Brazilian environmental law adopts a strict liability system for environmental damages, in connection with which a polluter is liable irrespective of whether the polluter was at fault or engaged in intentional misconduct, resulting in our joint and several liability for the obligations of our suppliers or customers, for example.
Brazilian law provides that separate legal personality may be disregarded where it would otherwise prevent the repayment of environmental damages. In such a situation, shareholders may be held personally liable for environmental liabilities.
If we become subject to environmental liability, any costs we may incur in connection with the indemnification against potential environmental damage would lead to a reduction in the financial resources that would otherwise remain at our disposal for current or future strategic investment, which may materially and adversely affect our business, results of operations or financial condition.
As environmental laws and their enforcement become increasingly stringent, our expenses for complying with environmental requirements are likely to increase in the future. Furthermore, the possible implementation of new regulations, changes in existing regulations or the adoption of other measures could cause the amount and frequency of our expenditures relating to environmental preservation to vary significantly compared to present estimates or historical costs. Any unplanned future expenses could force us to reduce or forego strategic investments, and as a result, could materially and adversely affect our business, results of operations or financial condition.
The occurrence of environmental damage may lead to the need to make significant financial resources available for both containment and repair of these damages. The occurrence of such events may also lead to a disruption in production due to intervention by government agencies. In either case, financial and/or image impacts may be significant. In addition, the creation of new regulations may lead to the need for greater expenses for environmental preservation. Furthermore, extensive environmental regulation can also lead to delays in the implementation of new projects as bureaucratic procedures for obtaining environmental licenses from various government agencies may take considerable time.
We are party to a number of administrative and judicial proceedings for alleged failures to comply with environmental and health laws, which may result in fines, shutdowns, obligations to remedy or contain the environmental damage caused or other adverse effects on our operations. Claims that give rise to administrative proceedings may also lead to civil or criminal claims against us and our subsidiaries. Our costs of complying with current and future environmental and health and safety laws, and our liabilities arising from past or future claims, could adversely affect our business or financial performance.
Raízen, Moove and Compass are subject to the application of regulatory penalties in the event of noncompliance with the terms and conditions of their respective authorizations, including the possible revocation of such authorizations.
Raízen performs generation activities in accordance with the regulations applicable to the energy sector and with the terms and conditions of authorizations granted by the Brazilian government through ANEEL. The duration of such authorizations varies from 20 to 35 years.
ANEEL may apply regulatory penalties to Raízen in the event of noncompliance with the authorizations or with the regulations applicable to the energy sector. Such penalties may include, depending on the seriousness of the infraction, warnings, fines (in some cases up to 2% of our revenues for the last 12 months), restrictions on Raízen’s operations, temporary suspension from participating in public bidding procedures to obtain new permissions, authorizations and concessions, prohibition from contracting with ANEEL, and revocation of its authorizations.
Furthermore, the electricity trading operations of Raízen and Compass are highly regulated and supervised by the Brazilian government, including through ANEEL, as well as other regulatory authorities, which have discretionary authority to implement and change policies, interpretations and rules applicable to different aspects of Raízen and Compass’ businesses, especially their operations, maintenance, safety, compensation and inspection.
In addition, Raízen conducts its fuel distribution activities and Moove manufactures and distributes lubricants and base oil in accordance with the rules and regulations applicable to the oil and gas sector in Brazil as well as with the terms of the licenses and permits granted to them by the Brazilian government acting through the ANP. Failure to comply with the applicable rules and regulations or with the terms of the relevant licenses and permits may result in fines ranging from R$5,000 to R$5 million and other penalties (including confiscation or destruction of products, cancellation of product registrations, bans on certain facilities, and revocation of existing licenses and permits, among others).
We cannot assure you that Raízen, Moove and Compass will not be penalized by ANEEL, ANP or other federal, state or local regulatory authorities, as applicable, nor can we assure you that they will comply with all terms and conditions of their authorizations and with the regulations applicable to their respective businesses, which may have a material adverse effect on their and our business, financial condition and results of operations.
Anticompetitive market practices in some of the businesses we operate in may distort prices.
The ethanol and sugar industries in which Raízen operates are highly competitive. Internationally, Raízen competes with global ethanol and sugar producers in the United States, India, Thailand, Australia and Europe, among others. Some of Raízen’s competitors are divisions of larger enterprises and may have greater financial resources than Raízen has or than we have. In Brazil, Raízen competes with numerous small to medium-sized producers. The Brazilian ethanol and sugar industry remains highly fragmented. Each of these producers’ markets ethanol and sugar products through the Cooperative of Sugarcane, Sugar and Ethanol Producers of the State of São Paulo (Cooperativa de Produtores de Cana-de-açúcar, Açúcar e Álcool do Estado de São Paulo), or “Copersucar.” Copersucar consists of producers in the states of São Paulo, Minas Gerais and Paraná. Raízen is not a member of Copersucar.
Raízen also faces strong competition from international producers, particularly in highly regulated and protected markets such as the United States and the European Union. With regard to sugar exports, Raízen faces intense competition from producers all around the world, including India, Thailand, and the European Union, among others. There are global producers of sugar whose costs are lower than those of Brazilian producers, including Raízen, and whose production capacity and prices could lead to a decrease in prices on the global sugar market. Furthermore, Raízen faces very strong competition internationally with regards to ethanol, especially from the United States. Ethanol production in the United States is based on corn-derived ethanol and is undertaken on a larger scale than Brazilian ethanol production. Accordingly, a reduction in corn prices may lead to material reductions in the price of ethanol produced in the United States and result in increased competition in the Brazilian market.
Historically, imports of sugar have not provided substantial competition for us in Brazil due to, among other factors, the production and logistical cost-competitiveness of sugar produced in Brazil. If the Brazilian government were to create incentives for sugar imports, Raízen could face increased competition in the Brazilian market by foreign producers. Many factors influence our competitive position, including the availability, quality and cost of fertilizer, energy, water, chemical products and labor. Some of our international competitors might have greater financial and marketing resources, larger customer bases and broader product ranges than Raízen does. If Raízen is unable to remain competitive with these producers in the future, its market share may be adversely affected.
The Brazilian fuel distribution market in which Raízen operates is active and highly competitive. For example, we compete with domestic fuel distributors who purchase substantially all of their fuel from Petrobras and from suppliers based outside of Brazil. There are few domestic participants, such as Vibra, Ipiranga and Raízen, who import fuels into Brazil. In addition, Raízen competes with producers and marketers in other industries that supply alternative forms of energy and fuel to satisfy the requirements of Raízen’s industrial, commercial and retail consumers. Certain measures currently being taken by participants in the fuel distribution market, including the expansion of their distribution networks, as well as the arrival of new participants, may result in an increase in fuel supply and a consequent decrease in fuel prices, which may have an adverse effect on our business, financial condition and results of operations. Raízen’s main competitor in Argentina is state-owned YPF, which has more than half of the market share in the country.
Moove’s main competitors in the global lubricant market are larger and have substantially greater resources than Moove. Because of their larger capitalization, these companies may be more flexible in responding to volatile industry or market conditions, such as shortages of base oil and other feedstock or intense price fluctuations. The actions of Moove’s competitors could lead to lower prices or reduced margins for Moove’s products, which could have a material and adverse effect on Moove and on our business, results of operations and financial performance.
Competition in the transportation services industry in which Rumo operates is intense and includes: (i) competition with other transportation modes, such as road freight; (ii) competition with alternative export options for agricultural products through other ports; (iii) dependence on operating quality and port and terminal capacity; (iv) the limitations established by the maximum tariffs established by the ANTT; (v) a reduction in road tariffs, particularly during times of declining growth rates in the economy or low demand from agricultural producers, which may limit our ability to maintain or increase rates, operating margins or growth of Rumo’s business; and (vi) establishment of cooperative relationships by Rumo’s competitors to increase their ability to address shipper needs. Rumo’s main competitors are companies in the truck transportation business, which has historically been the main cargo transportation mode in Brazil. Any new measures by the Brazilian government that benefit or reduce costs for road transportation, such as cheaper toll fares or permanent suspension of the toll road concession program, may also limit Rumo’s growth prospects. Rumo may also face significant competition from third parties if the granting authority decides to subject its maturing concessions to a rebidding process.
The intense competition in the Brazilian markets in which we operate, and the actions of our competitors could lead to lower prices or reduced margins for the products we sell, as well as reductions in our sales volumes, which could have a material and adverse effect on our business, results of operations and financial performance.
The raw materials and supplies we use are subject to price fluctuations.
Raw materials used in our business and the costs of services in connection with our operations are subject to wide fluctuations depending on market conditions and government policies. The prices charged for our various inputs and services are influenced by several factors over which we have little or no control, including, but not limited to, international and national economic conditions, regulations, government policies, the actions of our counterparties, tariff adjustments and global effects of supply and demand. We cannot assure you that we will be able to pass on any increased costs to our customers, which could decrease our profit margin and result in a material adverse effect on our business, financial condition and results of operations.
Furthermore, the war between Russia and Ukraine, conflicts in the Middle East and the COVID-19 pandemic have disrupted supply chains and international trade generally, affecting in particular the supply of fertilizer globally and in Brazil. Brazil depends to a significant extent on imports of Russian and Belarusian fertilizer, which have been severely disrupted. Raízen may be unable to obtain fertilizer (in particular nitrate) on favorable terms, sufficient quantities or at all, which could make agricultural production less efficient (potentially resulting in reduced output) or result in increases in costs (including as a result of the need to purchase other types of fertilizers). In addition, failure to obtain sufficient amounts of fertilizer may result in a reduction in grain production, which could affect Rumo’s transported volumes. Rumo has also purchased railroad tracks from Russian companies in the past. While we expect that Rumo will be able to source these tracks from other, non-Russian suppliers if needed, the prices charged and terms demanded by these alternative suppliers may not be as favorable as those which Rumo has obtained in the past. Any of these developments could have a material adverse effect on our business, financial condition and results of operations.
Inputs are also subject to seasonal cycles of growth and harvest, which may affect Raízen’s business depending on the sugarcane growth cycle, as well as Rumo, which may be impacted by the grain harvest cycle. We cannot predict when input and service prices will be adjusted. As such, costs and investments may be negatively influenced by various factors, including rising inflation which could reduce our profitability if we are unable to pass on these costs. Investments may also be affected, as higher expenditures could reduce project returns, given that the costs of raw materials, services, and even capital may increase.
The fuel, natural gas, and base oil distribution businesses are concentrated in a single supplier.
A significant interruption in our sales of fuels, natural gas and lubricants may occur if there is an interruption in the supply by our only supplier, Petrobras.
Any interruption would immediately affect our ability to supply products to our customers, increase our purchasing costs and reduce our sales volume, consequently adversely affecting our operating margins. If we are unable to obtain an adequate supply from Petrobras on acceptable terms, we may seek to cover their demands through purchases on the international market. The cost of products on the international market may be higher than the price obtained through the supplier, and the logistics infrastructure for importing petroleum-based fuels into Brazil is limited and almost entirely controlled by Petrobras.
We are subject to developments affecting the Brazilian agribusiness sector as a whole.
We cannot assure you that in the future, the Brazilian agribusiness sector, on which a significant portion of our business depends and which is a key part of Brazil’s economy, (i) will maintain the growth rate and development which it has experienced in recent years and (ii) will not suffer losses due to unfavorable climatic conditions, reduction of the prices of the agricultural commodities in the national and international markets, changes in credit policies for domestic producers, both by government agencies and private entities, that may affect our income, as well as other economic and political crises that may affect the agricultural industry in general. Any deterioration in the overall condition of the Brazilian agribusiness sector may have a material adverse effect on us.
We may be adversely affected by unfavorable outcomes in pending legal proceedings.
We are involved in a significant number of tax, civil (including regulatory and environmental) and labor proceedings. We cannot predict whether we will prevail in these or other proceedings, or whether we will have to pay significant amounts, including penalties and interest, as payment for our liabilities, which would materially and adversely impact our business and financial performance. In addition, we are involved in a significant number of tax, civil, and labor proceedings, both judicial and administrative, for which no provisions have been recorded, as the likelihood of loss is considered possible or remote. Should any of these proceedings be decided unfavorably against us, our business, financial condition and results of operations could be materially and adversely affected. Unfavorable decisions in criminal proceedings involving members of our management may also have a material adverse effect on us.
Our business would be adversely affected if operations at our terminal facilities, transportation means and distribution channels were to suffer significant interruptions.
Our operations depend on the uninterrupted operation of our terminals and storage facilities and various means of transportation and distribution facilities. We would be adversely affected if our operations or those of our customers and suppliers were to suffer significant disruptions. The distribution of fuels, natural gas and other products is by nature subject to inherent risks, including interruptions or disruptions in the distribution system that may be caused by accidents or force majeure events.
Operations at our facilities and at the facilities owned or operated by our suppliers and customers could be partially or completely shut down, temporarily or permanently, as the result of any number of circumstances that are not within our control, such as:
Any significant disruption at these facilities or the inability to transport products to and from these facilities or to and from our customers, subsidiaries, and jointly controlled companies, for any reason, would materially and adversely affect our business, financial condition and results of operations.
Our activities are inherently hazardous and involve high operational risk.
The complex manufacturing operations performed at (i) Raízen’s facilities (mills, terminals and its refinery in Argentina), (ii) Comgás (infrastructure used in the distribution of piped natural gas), (iii) Moove (a lubricants oil blending plant) and (iv) Rumo (storage terminals, ports and railcars) involve a variety of safety and other operating risks, including the handling, production, storage and transportation of toxic materials. These risks can result in personal injury, death, severe damage to or destruction of property, plants and equipment, and environmental damage. A major accident at one of our subsidiaries’ facilities could force us to suspend operations and result in significant compensation costs, loss of revenue and reputational damage.
Railroad transportation is an activity, which is carried out by Rumo, that involves risks relating to mechanical failures, derailments or other accidents that could interrupt the network of railroads and result in the payment of fines, damages to locomotives and wagons and loss of the product transported, which could result in significant financial losses and reputational damage for us. These accidents may also expose nearby communities to risks of life, personal injuries, or significant damages to property and the environment. The occurrence of any of these events may have a material adverse effect on our business, financial condition and results of operations. The proximity of our operation and storage sites to populated areas, including residential, commercial and industrial facilities, may also increase our risk exposure.
Insurance proceeds, if available, may not be received in a timely manner and may be insufficient to cover all losses, including loss of profits. Equipment breakdowns, natural disasters, and delays in obtaining necessary supplies, parts, or replacement equipment may also adversely affect operations and, consequently, the operating results of our subsidiaries.
The costs associated with complying with current and potential legislation relating to environmental protection, health and safety and liabilities incurred in connection with the leakage or exposure to harmful substances are substantial. Any increase in such costs could have a material adverse impact on our and our subsidiaries’ business, results of operations and financial condition.
Any soil or subsurface contamination may subject our subsidiaries to administrative sanctions, including, but not limited to, suspension, shutdowns, mandatory payment of fines, and other expenses, or an obligation to materially alter or cease certain operations. Additionally, they may be subject to criminal and civil liability in the event of environmental damage, which includes the obligation to remediate and/or compensate for the contaminated area and any harm caused to the environment, public health, and third parties.
In Brazil and the other markets in which we operate, there are a wide range of regulations, norms and standards that regulate the handling, storage, use, transportation and marketing of products considered hazardous. Failure to comply with these regulations may result in the filing of administrative proceedings against these companies and the payment of fines, penalties or obligations to indemnify, as well as other sanctions.
The shareholders’ and certain other definitive agreements with respect to the Joint Venture and certain other of our subsidiaries are subject to various put and call options and termination provisions.
We have entered into certain definitive agreements with Shell with respect to the Joint Venture, Raízen. Specifically, these agreements set forth the rights and obligations of each shareholder in respect of our and Shell’s interest in the Joint Venture and establish certain options whereby we or Shell may acquire the other shareholder’s interest in the Joint Venture, certain lock-up provisions, rules governing intragroup transfers regarding our economic group and Shell, and remedies for fundamental breaches of the documentation governing the incorporation and operation of the Joint Venture. If triggered, these provisions may cause the Joint Venture, or our participation in it, to terminate prior to the scheduled expiration date of certain of the agreements in June 2031.
In November 2016, we executed amendments to certain agreements with Shell to remove the fixed-date call options over Raízen S.A. shares exercisable in 2021 and 2026 and replace them with certain call and put options exercisable by us or Shell in certain circumstances, including, among others, (1) fundamental breaches of the obligations provided for in the agreements governing the Joint Venture, (2) breach of anticorruption laws, (3) insolvency or bankruptcy of a party, (4) change of control and (5) in the event of the death or disability of our current Chairman, Mr. Rubens Ometto Silveira Mello or if he fails to attend meetings of the board of directors of Raízen for 12 consecutive months. Moreover, we granted Shell a call option that is applicable if we fail to comply with certain obligations agreed upon with Shell or if certain of Raízen’s or our financial indices are not met.
We also granted Shell a call option that can be exercised by Shell if a controlling company (referred to as a “Controlling Entity”) fails to (1) have a CEO for a period exceeding six months, (2) publish or prepare, as required by law, its financial statements under the terms and conditions agreed upon in the Joint Venture Agreement, or (3) if Cosan or a new shareholder of Cosan (referred to as a “New Cosan Shareholder”), as applicable, with respect to a joint venture entity (referred to as a “JV Entity”), fails to (i) appoint members to the executive board or (ii) propose names of candidates for the position of CEO of Raízen within the period provided for in the shareholders’ agreements. Lastly, there is a call option granted by us to Shell in the event of an involuntary delisting or involuntary suspension of the registration, as a publicly held company, of Cosan or any successor thereof.
We and Shell further agreed to renew the existing lock-up period for five years from the date of the execution of the amendment, following which the parties may sell their shares in Raízen S.A. subject to compliance with certain preemption rights in each other’s favor.
In May 2021 and July 2021, we executed amendments to certain agreements in anticipation of Raízen’s initial public offering, which was completed in August 2021. As part of these amendments, the lock-up period referred to above was renewed for an additional five years from July 2021. The call and put options described above remained the same.
We are also parties to shareholders’ agreements, partnership agreements, association agreements and other related agreements in relation to a number of other businesses, as described under “Major Shareholders and Related Party Transactions—A. Major Shareholders.” If any of the provisions described above or other similar provisions are triggered under the shareholders’ agreements or any of the other related agreements relating to the Joint Venture or our other businesses, our partnerships, or certain rights we hold in connection therewith, could terminate prior to the scheduled expiration, which could adversely affect our results of operations.
We and Shell have joint control over Raízen
Raízen is controlled by two different shareholders, Cosan and Shell. Pursuant to the Raízen shareholders’ agreement, several matters require the approval of its board of directors, which consists of eight members: two independent members and six members appointed by the two controlling shareholders (three each). Decisions of Raízen’s board of directors require majority approval, which could result in delays in making important decisions related to Raízen’s business if there is any misalignment between our interests and those of Shell.
The shared control may result in deadlocks and disputes between us and Shell regarding strategy, control and other important matters. Any such deadlocks and disputes could have a material adverse effect on Raízen’s and therefore, our business, financial condition and results of operations.
Public health threats or outbreaks of communicable diseases, such as the COVID-19 virus and others, could have an adverse effect on our operations and our financial results.
We may face risks related to public health threats or outbreaks of communicable diseases. The outbreak of communicable diseases could result in a widespread health crisis that could adversely affect the global economy and our ability and our business partners’ ability to conduct business in Brazil for an indefinite period of time. For example, the COVID-19 outbreak in China in early 2020, which spread globally and resulted in a slowdown in both global and regional economies, production shutdowns, supply chain disruptions and interruptions in international trade, negatively impacted the sectors in which we operate.
Disruptions in public and private infrastructure, including communications and financial systems, could materially and adversely disrupt our normal business operations. A significant portion of our employees work remotely either full-time or part-time. Remote work may cause certain risks to our business, including an increased demand for information technology resources, increased risk of phishing and other cybersecurity attacks, and increased risk of unauthorized dissemination of sensitive personal information or proprietary or confidential information about us or third parties.
The potential impact of any future health outbreak, epidemic or pandemic, and the measures that may be taken to control such outbreak by government and businesses, cannot be predicted and are beyond our control and it is possible that any such future outbreak could have an adverse effect on our business and results of operations.
We may not be successful in meeting our environmental, social and corporate governance, or ESG, commitments, which may have an adverse effect on our business, financial condition, reputation and results of operations.
The market is increasingly concerned with how companies assess and manage ESG risks to protect themselves and create opportunities to generate value. As part of this trend, we have made certain ESG commitments, and we strive to maintain socially responsible business practices, including fostering social investments and structuring programs to generate a positive social impact through in areas related to our business, such as renewable energy, employability, education, and culture.
There has been an increase in ESG regulations applicable to our business and we expect this trend to continue. Given the pace of legislative developments in this area, we may not be able to comply with the new regulations in their totality. We are also exposed to the risk that future ESG rules and regulations may adversely affect our ability to conduct our business by requiring us to reduce the value of our assets or reduce their useful life, facing increased compliance costs or taking other actions that may be adverse to us.
In addition, our suppliers or dealers may engage in conduct that violates human rights and for which we may be held liable in civil, labor, criminal and administrative proceedings, including for damages and remediation costs. As a result, we may face difficulties in obtaining or maintaining operating licenses, and our reputation may be negatively affected.
Failure to meet our ESG commitments, to pursue socially responsible business practices, partially or at all, or to vet our suppliers or dealers, may have a material adverse effect on our business, reputation, financial condition and results of operations.
We operate in sectors in which market demand and prices are cyclical and affected by weather and economic conditions in Brazil and worldwide.
The sectors in which we operate are historically cyclical and sensitive to internal and external changes in supply and demand, as well as to other factors over which we have no control, including for example weather conditions. Floods, droughts, frosts, lack or excess of rain, temperature and other climate factors can affect crops across the country, which impacts the business of Raízen and Rumo – the former because it affects the sucrose content in sugarcane and may reduce the harvest, as well as the quality and quantity of sugarcane harvested; the latter because it directly depends on the performance of the agricultural sector and the demand for grain and sugar transportation, which decline when weather conditions are unfavorable.
The energy generation and trading business also depends on climate conditions, tariff changes, and demand fluctuations, which may vary seasonally depending on the type of customer, the availability of other energy sources, and the entry of new competitors into the market.
A significant portion of the products we market also depends on the supply and demand in international markets, which may lead to price and margin fluctuations, sector expansion, and, in the case of commodities, exposure to price volatility due to weather conditions, natural disasters, investments, government programs and policies for the sector, foreign and domestic trade policies, changes in supply and demand, increased purchasing power, global production of similar and competing products, and other factors beyond our control.
Moreover, some products, such as sugar, have a significant portion of their global production traded on exchanges, making them subject to speculation, which can affect their price and the operating results of those who trade them, such as Raízen. The price of ethanol is also generally closely associated with the sugar and gasoline prices in international and local markets.
If we are unable to maintain sales at prices generally practiced in the Brazilian market, or if we are unable to export sufficient volumes to ensure a proper balance in the domestic market, our business and cash flow may be adversely affected.
We may be unable to protect our intellectual property rights and may be accused of violating third-party property.
If we are unable to protect our intellectual property rights, or those of subsidiaries, investees and jointly controlled companies, our ability to operate our business and to compete in the markets in which we operate could be adversely affected. Among other factors, the success of our business also depends on the effective protection of our trademarks, patents, domain names, trade secrets, know-how and intellectual property rights and those held by our subsidiaries, investees and jointly controlled company.
There is a risk that we may not be successful in renewing our title or licensing certain intellectual property rights in a timely manner or at all, or that the validity of such rights may be successfully challenged by third parties. In addition, we may not be able to enforce intellectual property rights in certain countries where our subsidiaries, investees or common controlled companies operate as the laws of certain foreign countries, including those in many emerging markets, may not fully protect these rights. The costs required to maintain proper registration and protect such rights can be substantial and affect the result of our operations.
We cannot assure you that third parties will not infringe or misappropriate intellectual property rights, despite our efforts to actively monitor their use. In addition, we are not able to guarantee that the measures taken by companies to protect our intellectual property rights will be sufficient. For this reason, we may need to engage in legal proceedings to defend our rights and there can be no guarantees that we will be successful.
The improper or unauthorized use of such intellectual property rights could decrease the value of our brands, adversely affect our reputation, cause a decline in sales, and have a material adverse effect on our business, financial condition and results of operations.
Additionally, third parties may claim that the products or services provided by our subsidiaries, investees or our jointly controlled company violate their intellectual property rights. Consequently, our companies may be forced to engage in potentially costly litigation, or to revise, in whole or in part, the products that are allegedly infringing on the rights of third parties and/or pay significant amounts in damages, royalties or licensing fees, in addition to the potential risk of damage to our image and loss of demand for our products. Any such developments could have a material adverse effect on business, financial condition and results of operations.
Irregular practices in the fuel and lubricant distribution markets may distort market prices.
Irregular practices have been one of the main problems affecting fuel distributors in Brazil. These practices usually involve a combination of tax evasion and fuel adulteration, such as diluting gasoline by mixing solvents or adding anhydrous ethanol in proportions greater than those permitted by law (anhydrous ethanol is taxed less than hydrous ethanol and gasoline).
Taxes constitute a significant portion of the cost of fuels sold in Brazil. For this reason, tax evasion has been a recurring practice of some distributors, allowing them to charge lower prices. These practices have allowed some distributors to supply large quantities of fuel products at prices lower than those offered by the main distributors, allowing the former to increase their sales volumes at the expense of the latter. Consequently, these anticompetitive practices may affect Raízen and Moove sales volumes, which could have a material adverse effect on our businesses. If these practices become predominant, it could result in lower prices or reduced margins for products sold, which may cause a material adverse impact on our subsidiaries’ businesses and results of operations.
Given the complexity and breadth of our operations and the special sensitivity of the sector in which we operate, particularly in regard to anticompetitive practices, we cannot guarantee that our internal control mechanisms, such as our governance and compliance programs, are sufficient to avoid risks of investigations for illicit or irregular conducts and possible sanctions and legal proceedings. Despite having these internal control mechanisms, we and our subsidiaries, investees and jointly controlled companies, may be subject to, among others, litigation, investigations, expenses, fines, sanctions and penalties, both administrative and criminal, by different authorities. We may also lose our licenses, permits or other regulatory instruments required for our operations, be subjected to search and seizure procedures, and suffer damage to our image and reputation. The fuel sector, in particular, has been the subject of investigations by the Brazilian authorities, especially by the Brazilian Antitrust Authority and the Public Prosecutors’ Offices. There are allegations regarding cartels and price agreements in the fuel distribution sector, and the Brazilian Antitrust Authority has been monitoring participants, which may adversely affect our operations.
Volatility and uncertainty in fuel prices can affect our operational margins and competitive position.
Fuel prices have historically been volatile and may continue to be so in the future. Fuel prices are influenced by numerous factors including, among others, global supply and demand, processing, transportation allotment and availability, price and availability of alternative fuel sources, weather conditions, natural disasters and political conditions or hostilities in oil-producing regions, besides the political factors related to government pricing policy.
In our operations, we may need to contract freight services provided by outsourced truck drivers to carry out the distribution of our products, and the costs of these types of services are strongly linked to the cost of fuels, especially that of diesel.
Particularly in relation to our subsidiary Rumo, significant reductions in fuel prices could make rail transport less attractive, considering that Rumo’s main competitors have a higher exposure to road freight. If fuel prices were to decrease, the price of rail transport would decrease less than the price of road freight, which could result in lost transportation volume for Rumo or force Rumo to decrease its prices to be able to retain or attract customers. In addition, the gas distribution market may also be impacted, because the price of natural gas is indexed to a basket of fuel oils and inflation. Rapid variations and/or substantial decreases in international prices for oil and oil-derived products may therefore have an effect on the price of our natural gas which could have a material adverse effect on Compass.
Accordingly, any significant variations in fuel prices may have a material adverse effect on our business, financial condition and results of operations.
The loss of our existing concessions may have a material adverse effect on our business and results of operations.
In Brazil, gas distribution and rail transportation services are provided through concessions granted by governmental authorities, and our Compass and Rumo businesses both rely on concession agreements with applicable governmental authorities. Concession agreements may be terminated as a consequence of the following: (i) expiration of the contractual term; (ii) expropriation of the concessions in the public interest (i.e., encampação); (iii) forfeiture (caducidade); (iv) termination; (v) annulment of the concession agreement to the extent irregularities in the bidding process or the granting of the concession are identified; or (vi) the bankruptcy of the concessionaire or expiration of the concession-holding entity.
Upon termination of a concession, the concession assets revert to the granting authority. Any compensation received by the concession holder upon termination may not be sufficient to offset investments made in, or the implied rate of return and the loss of future profits from, the concession. Furthermore, certain of our creditors may have claims over this compensation which have priority over our own.
If we fail to provide adequate services or if we fail to comply with applicable legal and regulatory norms and contractual clauses, including, without limitation, as a result of a negative outcome in ongoing legal proceedings, our concession agreements may be terminated, and the amount of compensation to be paid by the granting authority may be reduced as a result of the imposition of fines or other penalties, which may have a material adverse effect on our business and results of operations.
Additionally, under the terms of the concession agreements, the granting authority and its regulatory agencies may intervene in the concession to ensure the provision of the granted service and to enforce contractual clauses, regulatory standards, and applicable legislation. Any such intervention may result in additional costs and liabilities which we would be required to bear and which could have a material adverse effect on our business, financial condition and results of operations. Certain concession agreements also provide the granting authority the right to conduct tariff reviews. Tariff reviews are ordinarily performed every five years and set the maximum margin for the prospective cycle and the rates that will apply for each segment. In addition, any tariff review may result in a margin which is unfavorable to us.
Furthermore, due to the discretionary power of the applicable government authorities in granting the renewal of the concession agreements, we cannot assure you that the concession agreements will be renewed, that they will be renewed on the same terms or that, to the extent they are renewed, that the amount of compensation received in the event of nonrenewal, if any, will be sufficient to cover the full value of our investment, all of which may have a material adverse effect on our business, results of operations and financial condition.
As of the date of this annual report, renewal negotiations with the Brazilian government with respect to the renewal of the Malha Sul concession are ongoing, and there can be no assurance that the concession will be renewed on terms acceptable to Rumo or at all. Failure to renew the Malha Sul concession, or its renewal on materially less favorable terms, could have a material adverse effect on Rumo’s and our business, financial condition and results of operations.
Changes in accounting standards, pronouncements and interpretations, as well as amendments and/or updates to existing IFRS Accounting Standards issued by the IASB, may have a material effect on our consolidated financial statements.
The adoption of new accounting standards, pronouncements and interpretations, as well as amendments and/or updates to existing IFRS Accounting Standards issued by the IASB and/or the SEC, may have a material impact on our consolidated financial statements, with possible effects on our financial results, including possible impacts on the basis of dividend distributions. The effects of the adoption of new IFRS Accounting Standards can only be measured if and when the adverse effects mentioned above occur.
We may be unable to successfully implement our strategy.
Our strategy depends on several factors, including: (i) our ability to access new markets; (ii) our capacity to finance investments (whether through debt or otherwise); and (iii) the expansion of the operational capacity of our investees and the enhancement of their current capabilities to serve new markets. Failure to achieve any of these objectives, whether due to competitive challenges, cost-related factors, or limitations on our ability to invest, may restrict our ability to successfully implement our growth strategy.
It is possible that, to implement our growth strategy, we may need to finance new investments through additional indebtedness. Unfavorable economic conditions in Brazil and in the international credit markets—such as rising interest rates for new loans, reduced liquidity, or decreased interest from financial institutions in granting credit—may limit our access to new financing. Additionally, we cannot guarantee that, in the event we do not achieve the expected strategy, such outcome will not negatively impact us or our ability to meet our debt obligations.
We rely on third parties to supply inputs, machinery, and equipment used in our operations, as well as specific services, and are subject to potential price fluctuations and the availability of delivery of such machinery, equipment, and services.
Our business, financial condition and results of operations may be materially and adversely affected if we are unable to maintain or renew certain agreements (including, without limitation, supply agreements, service contracts, licensing agreements, distribution agreements, joint ventures, partnerships and others) with third parties which are important to our business and operations, or if such agreements can only be renewed on terms which are unfavorable to us.
We also outsource certain services required to carry out our activities and acquire from third parties the inputs, machinery, and equipment necessary for our operations. Any failures, delays, or defects in the provision of these services by subcontracted third parties, as well as in the supply of inputs, machinery, or equipment acquired, may result in delays or losses in the implementation of new assets or temporarily reduce the availability or production capacity of operating assets, affecting our revenues and reputation.
Additionally, due to the technical specifications and uniqueness of some of the equipment used in our facilities, in certain market segments we rely on a limited number of suppliers. We cannot assure you that there will be no market concentration or supply dependency. If any supplier discontinues production or ceases to sell any input or equipment acquired by us, it may not be possible—either immediately or permanently—to acquire such inputs or equipment or maintain the services provided in a timely manner from other suppliers under commercially reasonable conditions, which could adversely affect our operations and the implementation of new generation assets, and have a material adverse effect on us.
Any downgrade in our credit rating or Brazil’s sovereign rating may adversely affect our access to, or the limits of, future financing lines, increase our cost of capital, or result in restrictive covenants in our financing agreements.
We may be adversely affected by investor perceptions regarding risks associated with Brazil’s sovereign credit rating, which are based on a range of factors, including macroeconomic trends, fiscal and budgetary conditions, debt metrics, and the outlook for changes in any of these factors. Credit ratings provide the market with information about a company’s credit quality. When investors assess companies based on their credit ratings, those with lower ratings tend to face higher capital costs.
In addition, we and certain of our investees have recently been subject to negative rating revisions by domestic and international credit rating agencies, based on their respective assumptions and methodologies. In this context, negative perceptions related to the credit risk of a particular investee may adversely affect the perceived consolidated credit risk of the Cosan group.
Credit rating agency analyses for our company tend to consider factors related to our holding company structure, including our dependence on cash flows generated by our investees, elevated financial leverage, and increased sensitivity to the macroeconomic environment and prevailing capital market conditions.
These developments may restrict our access to new sources of financing, increase our cost of funding, result in the inclusion of restrictive covenants or the tightening of existing covenants in our financing agreements, as well as those of our subsidiaries and our investees, and may have a material adverse effect on the Cosan group.
Failures, defects, or inadequacies in our governance processes, compliance policies, systems, processes, and internal controls, including those resulting from misconduct, human error, or operational risks, may adversely affect us, our subsidiaries and our investees.
Our compliance and governance policies, which include the review of internal controls over financial reporting, may not be sufficient to ensure that we are able to comply with existing and future legal, regulatory (including applicable anti-corruption and antitrust laws), accounting and other corporate governance requirements and standards. Accordingly, we, our subsidiaries and our affiliates may be subject to violations of our code of conduct and anti-corruption policies, and cases of fraudulent behavior or corrupt or anticompetitive practices by employees, contractors or other agents.
Our internal controls may also not be effective in detecting and mitigating all risks inherent to our business, including compliance with laws and regulations, the conduct and management of operations, and may also be insufficient and/or not fully effective in detecting inappropriate practices or errors and misstatements in the issuance of financial statements. Any failure to maintain effective internal controls over financial reporting may adversely affect our ability to properly disclose our financial condition and results. If the internal controls related to the disclosure of consolidated financial information are not effective, or if independent auditors determine that we, our subsidiaries, and/or investees have a material weakness or significant deficiency in internal controls over financial reporting, we may lose investor confidence in the accuracy and integrity of such financial reports and suffer an impact on the market value of our shares.
Additionally, if we, our subsidiaries, and/or investees fail to effectively remediate any material weakness in internal controls related to financial reporting or to implement and maintain other effective control systems required of publicly traded companies, our access to capital markets may also be restricted.
Reputational damage may adversely affect our business and future prospects.
We are highly dependent on our image and credibility in the market to generate business. Several factors may cause reputational damage and lead to negative perceptions by clients, counterparties, suppliers, shareholders, investors, regulatory bodies, commercial partners, and other stakeholders. These factors include failure to comply with legal obligations, irregular sales to clients, involvement with suppliers of questionable ethical conduct, negative publicity, leakage of client information, employee misconduct, third-party failures in risk management, noncompliance with social and environmental responsibilities, and legal and regulatory obligations applicable to their activities, among others.
Additionally, certain significant actions taken by third parties—such as competitors or other market participants in the sectors in which we operate—may indirectly harm our reputation in the eyes of clients, investors, and the broader market. If we are unable, or perceived as unable, to properly address these issues, we may be subject to penalties, fines, class actions, and regulatory investigations, among other consequences.
Reputational damage among clients, investors, and other stakeholders may negatively affect us. Part of the relationship between us and our clients depends on direct interaction among employees or representatives of the businesses involved. We cannot assure you that our employees will always comply with internal policies or that internal procedures will effectively monitor and identify inappropriate behavioral misconduct, such as irregular sales or misuse of information. These risks may lead to friction with clients, the need for compensation or refunds, litigation, and—depending on their extent—expose us to reputational risk, financial losses, and loss of market credibility, and, where applicable, scrutiny from regulatory authorities.
Diseases and pests may affect crops, which could result in the destruction of a significant portion of the harvest and adversely impact our operating results.
Diseases and pests may occur from time to time and have a devastating effect on the crops we produce and the volume of cargo we transport. Even when only part of the harvest is damaged, our business, operating results, and financial condition may be adversely affected, as we may have already incurred a substantial portion of the production costs related to that crop. The cost of treating crop diseases tends to be high. Any serious incidents of disease or pest infestation and related costs may negatively impact the production levels we sell or transport, and, as a result, have a material adverse effect on our business, financial condition and results of operations.
We hold equity interests in companies in which third parties also hold ownership, and our interests may conflict with those of other shareholders.
We hold equity interests in companies in which third parties also hold ownership, including through structures involving different classes of shares, such as preferred and common shares. Our relationship with these third parties may be subject to procedures, terms, and conditions agreed upon in the applicable shareholders’ agreements, including matters related to voting rights, appointment of management, dividend distribution, and transfer of ownership. Accordingly, even in companies where we hold control, business decisions must comply with the governance rules established in the respective agreements. In cases where we do not hold control—such as those in which we have minority interests and/or preferred shares without voting rights or with restricted voting rights—we may not have decision-making power over the conduct of business. In these scenarios, our interests may conflict with those of other shareholders. We cannot assure you that the interests of third parties will be aligned with ours or with those of other investors, including in resolutions submitted to the general shareholders’ meeting or to management bodies. Any disagreements may result in deadlocks and adversely affect the business in question as well as us.
Unfavorable rulings in criminal proceedings against members of management may negatively affect us.
Mr. Rubens Ometto Silveira Mello, Chairman of our Board of Directors, is a defendant in a criminal proceeding initiated to investigate alleged involvement in antitrust violations and cartel formation, stemming from the artificial fixing of fuel prices and the establishment of an alliance aimed at regional market control within another company where he serves as an executive officer. Throughout the course of the proceeding or following any decision, Mr. Rubens Ometto Silveira Mello may be prevented from continuing to perform his management duties, and depending on the development of the case, our reputation with counterparties may be adversely affected, and our business activities, results, and share value may be negatively impacted.
We may have customer concentration and dependency in our client portfolio for certain products or services.
The markets for certain of our products and services may be highly competitive and concentrated, with a limited number of clients and competitors. As a result, clients in these sectors may exert significant bargaining power to negotiate prices and other sales conditions. Additionally, the intense competition in the sectors in which we operate further increases the bargaining power of these clients, which may affect our ability to negotiate prices, volumes and other terms and conditions, and adversely affect our business, financial condition and results of operations.
Specifically, a non-negligible share of Rumo’s transportation services and of Raízen’s sugar and ethanol production is sold to a small number of customers that may be able to exercise significant bargaining power concerning pricing and other sale terms. In addition, intense competition in the transport, ethanol and sugar industries further increases the bargaining power of customers, which may have a material adverse effect on Rumo and Raízen’s sales volumes and, consequently, on us.
If we lose a major client, we cannot assure you that we will generate similar revenue from other clients in the future. Any change in demand for products and services by our key clients may have a material adverse effect on our business, financial condition and results of operations. We also cannot assure you that sales and service contracts will be renewed upon expiration. Any significant changes in our clients’ businesses or financial condition may also have a material adverse effect on our business, financial condition and results of operations, for example in the form of reduced volumes of goods and services purchased from us. Furthermore, if any of these clients face financial difficulties, it may increase their default risk and adversely affect us.
If we do not successfully comply with laws and regulations designed to prevent governmental corruption in countries in which we operate (notably Brazil), we could become subject to fines, penalties or other regulatory sanctions, which could cause our sales and profitability to be materially reduced.
We are subject to anti-corruption, anti-bribery, anti-money laundering and other international trade laws and regulations. We are required to comply with the laws and regulations of Brazil and various jurisdictions where we conduct operations. Among others, we are subject to laws relating to the OECD’s 1997 Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, such as the U.S. Foreign Corrupt Practices Act and Brazilian Anticorruption Law No. 12,846/2013 (Lei Anticorrupção), or the “Anti-Corruption Law,” which has been in effect since January 29, 2014.
Our anti-corruption policies and procedures are designed to prevent governmental corruption violations, which may not prevent our management, employees or third parties acting on our behalf in the countries in which we operate from taking actions that violate applicable laws and regulations on improper payments to government officials for the purpose of obtaining or keeping business or business advantages.
Given the complexity and breadth of our operations and the particular sensitivity of the sectors in which we operate to anticompetitive practices, we cannot assure you that our processes, such as our governance and compliance programs, are sufficient to prevent the risk of investigations into unlawful or irregular conduct and potential penalties.
Any violation of these laws may have a material adverse effect on our business, including our ability to obtain loans and financing. The Anti-Corruption Law imposes liability on companies for acts of corruption, fraud, or manipulation of public bids and government contracts, and interference with investigations or inspections by government authorities. Companies found liable under the Anti-Corruption Law may be subject to fines, confiscation of assets or benefits obtained illegally, suspension or partial prohibition of operations, dissolution of the entity, and/or prohibition from receiving incentives, subsidies, donations, or financing from the government or government-controlled entities for up to five years, among other sanctions. Additionally, several financial contracts entered into by our companies contain clauses requiring compliance with the Anti-Corruption Law. Therefore, noncompliance with the Anti-Corruption Law by us or our representatives may constitute a default event under such contracts and, consequently, trigger the early maturity of our indebtedness.
As a result, if our management, employees, or third parties acting on our behalf in countries where we operate become involved in any anti-corruption or criminal investigation or proceeding in connection with our business in Brazil or any other jurisdiction, our business may be materially and adversely affected, both financially and reputationally.
The interests of our controlling shareholder may differ from or conflict with the interests of our other shareholders.
Our controlling shareholder has the power to, among other things, elect the majority of the members of the board of directors and make decisions on all key matters requiring shareholder approval, such as corporate reorganizations, asset sales, the cancellation of our registration with securities markets regulators, disposal of our subsidiaries and the amount and timing of distributions of dividends and/or interest on shareholders’ equity to our shareholders, in each case subject to our bylaws and the rights afforded to the Investors under the Investment Agreement and the shareholders’ agreement entered into with certain shareholders in the third quarter of 2025. See “Item 7. Major Shareholders and Related Party Transactions—A. Major Shareholders—Shareholders’ Agreements and Other Arrangements—Shareholders’ Agreement with the BTG Entities and the Perfin Entities” for additional information on the Shareholders’ Agreement.
As long as our controlling shareholder holds such voting power, it will have the ability to elect the majority of the board of directors, exercise overall control over management, determine our policies, sell or otherwise transfer shares amounting to a controlling interest in our share capital and determine the outcome of significant shareholder resolutions, including related party transactions, corporate reorganizations and sales of all or substantially all assets, as well as the ability to approve the distribution and payment of any future dividends.
Our controlling shareholder may have interest in pursuing acquisitions, asset disposals, partnerships, seeking financing or making other decisions that could conflict with the interests of the other shareholders and may not result in improvements to our operating results, potentially causing a material adverse effect on the Company.
Risks Related to the Countries in Which We Operate
Our business and financial performance may be negatively affected by economic, political and other conditions in Brazil, as well as governmental measures.
Political and social events in Brazil have also affected and continue to affect the Brazilian economy, influencing investor and public confidence. Instability resulting from changes to policies or regulations could contribute to economic uncertainty and intensify the volatility of Brazilian securities markets. Political developments, in particular, have had a significant impact on the confidence of investors and the general public, adversely affecting economic performance and increasing volatility and reduced liquidity in the Brazilian capital markets. Recently, Brazil has experienced high levels of political and economic instability, including contraction of its gross domestic product, strong fluctuations of the real against the U.S. dollar, increased unemployment and lower levels of spending and consumer confidence. These issues may be exacerbated by the presidential election scheduled for October 2026.
Our business, financial performance and prospects, as well as the market prices of our securities, may be adversely affected by, among others, the following factors:
Instability arising from any changes made by the Brazilian government to policies or regulations that may affect these or other factors in the future could contribute to economic uncertainty in Brazil and intensify the volatility of Brazilian securities markets and securities issued abroad by Brazilian companies.
Uncertain macroeconomic conditions in Brazil are expected to continue throughout 2026 as considerable economic and political uncertainty remains both in Brazil and globally, compounded by the ongoing imposition of tariffs and other trade barriers as well as changes to global trade policies, war between Russia and Ukraine and the conflicts in the Middle East, which have contributed and continue to contribute to further increases in the prices of goods and services including energy, oil, gas, fertilizer, basic materials and other commodities and to volatility in financial markets globally, as well as a new landscape in relation to international sanctions. Furthermore, 2026 is a presidential election year in Brazil. Historically, in election years, especially presidential elections, foreign investments in the country decrease and political uncertainty generates greater instability and volatility in the domestic market, which may adversely affect our business and results of operations. It is unclear whether these challenges and uncertainties will be contained or resolved, and what effects they may have on Brazilian and global political and economic conditions in the long term.
Inflation, actions to combat inflation and public speculation about possible additional actions have also had significant effects on the Brazilian economy and contributed materially to economic uncertainty in Brazil and to heightened volatility in the Brazilian securities markets. We cannot control or predict what policies or actions will be taken by the Brazilian government in the future.
Brazil has experienced extremely high rates of inflation in the past and has therefore implemented monetary policies that have resulted in one of the highest interest rates in the world. According to the IGP-M, a general price inflation index, Brazil recorded deflation of 1.0% in 2025, and inflation 6.5 % in 2024 and 3.2% in 2023. In addition, according to the IPCA, published by the IBGE, the Brazilian price inflation rates were 4.3% in 2025, 4.8% in 2024 and 4.6% in 2023.
Brazil may experience high levels of inflation in future periods and has recently experienced a significant increase in inflation. The Brazilian government’s measures to contain inflation have often included maintaining a tight monetary policy with high interest rates, thereby restricting access to financing and slowing economic growth. Inflation, the measures to combat it, and speculation about possible additional measures have significantly contributed to economic uncertainty in Brazil and increased volatility in the Brazilian capital markets. Periods of higher inflation may reduce the growth rate of the Brazilian economy, which could decrease demand for our products in Brazil and reduce net sales. Inflation may also increase some of our costs and expenses, and we may not be able to pass these increases on to our customers, thereby reducing our profit margins and net income. Additionally, high inflation rates generally lead to higher domestic interest rates, which may increase the cost of our floating-rate debt denominated in reais, resulting in lower net income. Inflation and its impact on domestic interest rates may also reduce liquidity in the domestic capital and financial markets, affecting our ability to refinance debt in these markets. Any reduction in net sales or net income, as well as any decline in our financial performance, may also result in a decrease in the market price of our common shares and ADSs.
High interest rates may adversely affect our operations and financial condition.
The Brazilian government’s measures to control inflation have frequently included maintaining a restrictive monetary policy with high interest rates, thereby limiting the availability of credit and reducing economic growth. Official interest rates in Brazil at the end of 2025, 2024 and 2023 were 15.00%, 12.25% and 11.75% per year, respectively, as established by the monetary policy committee of the Central Bank of Brazil (Comitê de Política Monetária). As of the date of this annual report, the official interest rate in Brazil was 14.75%. Any increase in such interest rates may negatively affect our profits and results of operations, thereby increasing the costs of financing our operations.
High interest rates may impact our cost of obtaining loans and also the cost of indebtedness, resulting in an increase in our financial expenses. This increase may adversely affect our ability to pay our financial obligations, as it reduces our cash availability. Mismatches between contracted indexes for assets versus liabilities and/or high volatilities in interest rates may result in financial losses for us.
As of December 31, 2025, our consolidated indebtedness was either fixed or linked to various benchmark interest rates typically used in Brazil. We enter into certain financial instruments to mitigate our exposure to interest rate fluctuations. For more information, see “Item 5. Operating and Financial Review and Prospects—B. Liquidity and Capital Resources—Indebtedness.”
Significant volatility in the value of the Brazilian real against the U.S. dollar may impair our ability to meet our liabilities denominated in U.S. dollars.
Historically, the Brazilian currency has experienced frequent devaluations. Exchange rate fluctuations between the real and the U.S. dollar and other foreign currencies have been significant. As of December 31, 2024, the exchange rate was R$6.19 per U.S.$1.00. Since we generate part of our revenues in reais, a depreciation of the real against foreign currencies may result in losses on obligations denominated in foreign currencies, as well as an increase in our funding costs, negatively impacting our ability to finance our operations in the international capital markets and the price of our shares. Further devaluations of the real may occur and affect our business in the future. Monetary and exchange rate gains or losses may be substantial and could significantly impact our earnings from one period to another.
Additionally, a depreciation of the real against the U.S. dollar may (i) result in additional inflationary pressures in Brazil, generally increasing the price of imported goods and services and requiring restrictive government policies to control demand; and (ii) reduce investor confidence in Brazil and decrease the market price of our shares. On the other hand, an appreciation of the real against the U.S. dollar may reduce Brazil’s current account and balance of payments, as well as affect export growth. Furthermore, a depreciation of the real would increase expenses related to interest on our U.S. dollar-denominated indebtedness.
We have both costs and revenues in Brazilian reais and U.S. dollars. Consequently, our operating margins may be adversely affected when there are changes in the value relationship between these currencies or between the real and any other currency used in countries where we operate. Moreover, we have debt indexed to both fixed and floating interest rates and are therefore exposed to the risk of interest rate fluctuations. If interest rates rise, our financial results may be affected. Inflation and the economic measures taken to combat it may adversely impact the Brazilian economy and the securities market, as well as our business and operations.
Our international operations expose us to political and economic risks in other countries.
Our international activities and those of our subsidiaries, investees and jointly controlled companies, including the Joint Venture, expose us to risks not faced by companies that operate solely in Brazil. We also export our products to a number of markets outside of Brazil. In addition, we source a number of products, equipment and services from an extensive network of suppliers and distributors located in Brazil and internationally. Risks associated with our international operations and foreign trade include: (i) foreign exchange controls; (ii) changes in the political or economic conditions in a specific country or region, especially in emerging markets; (iii) potentially negative consequences resulting from changes to regulatory requirements; (iv) difficulties and costs associated with our compliance with different laws, treaties and complex international regulations; (v) tax rates that may exceed those applicable in Brazil and other countries or gains that may be subject to withholding regimes and an increase in repatriation taxes; (vi) the imposition of tariffs and non-tariff barriers; and (vii) imposition of restrictions, quotas, sanctions or trade barriers; and (viii) limitations on the repatriation of undistributed profits. The realization of any of these risks may materially adversely affect the ability to produce, sell and/or export such products and consequently impact our business, results of operations or financial condition.
Recently, the U.S. government has put in place trade tariffs on a range of goods and services, contributing to increased uncertainty in global trade dynamics. Other countries have retaliated by putting in place tariffs on U.S. goods and services or taking other punitive steps. In addition, on July 30, 2025, the U.S. government enacted an executive order imposing an additional 40% tariff on certain Brazilian products, although some of these tariffs were subsequently rolled back partially or in full. We export our products to the United States and to a number of other countries globally. Increases in tariffs and other trade barriers may adversely affect our ability to continue exporting products. In addition, we also rely on equipment, technology and services sourced from the U.S. and globally, many of which may be affected by these measures. The resulting disruptions could lead to higher costs or delays in the procurement of critical inputs. Additionally, escalating trade tensions and broader shifts in trade policy could impact the global economy, potentially affecting the markets in which we operate.
Developments and the perception of risk in other countries, especially the United States and emerging market economies, may adversely affect the market price of Brazilian securities.
International investors tend to view Brazil as an emerging market. Historically, adverse events in developing economies have led investors worldwide, including those in the United States and European countries, to perceive these markets to represent an increased level of risk. Such perceptions regarding emerging market countries significantly affect Brazil, the Brazilian capital markets and the availability of credit in Brazil from both domestic and international capital sources.
Additionally, the Brazilian economy and the market value of securities issued by Brazilian companies are influenced, to varying degrees, by economic and market conditions in Brazil and other countries, including the United States, European countries and emerging economies. Although economic conditions in these countries may differ considerably from those in Brazil, investors’ reactions to events in such other countries can have an adverse effect on the Brazilian economy and the market value of securities issued by Brazilian issuers. In the past, the development of adverse economic conditions in other countries has generally resulted in capital outflows and, consequently, a reduction in external resources invested in Brazil.
Brazil is subject to events including, but not limited to: (i) the financial crisis and political instability in the United States; (ii) recent tariffs imposed on Brazilian products and diplomatic tensions between the United States and Brazil; (iii) the conflict involving Russia and Ukraine, which began in February 2022, resulting in increased prices for oil and natural gas, commodities produced in large scale by Russia and imported by European Union countries, as well as a military and geopolitical crisis with worldwide repercussions; (iv) the conflicts in the Middle East; (v) the trade war between the United States and China; and (vi) crises in Europe and other countries.
These developments may produce a range of effects that directly or indirectly affect the Brazilian capital markets and economy, including price fluctuations of listed companies’ securities, reduced credit availability, deterioration of the global economy, fluctuations in exchange rates and inflation, among others. Such effects may substantially limit shareholders’ ability to sell our common shares at the desired price and time and, consequently, may adversely affect the market price of our securities.
Risks Related to Our American Depositary Shares and Our Common Shares
The potential delisting of our ADSs from the NYSE or deregistration with the SEC may limit liquidity, reduce transparency and affect the ability to trade our securities.
We are considering taking certain actions to cause the delisting of our ADSs from the NYSE. If we decide to delist our ADSs from the NYSE, our ADSs would cease to be tradeable on the NYSE and listing of our securities would be restricted to the listing of the common shares on the B3. Such a decision could significantly reduce the liquidity of our ADSs and limit investors’ ability to trade our securities in a market with a higher trading volume and a broader investor base. In addition, we would also no longer be required to follow the mandatory corporate governance standards promulgated by the listing rules of the NYSE.
Depending on future circumstances, we may also seek deregistration with the SEC, which would result in the suspension of our reporting obligations with the SEC and ultimately the extinction thereof. In such a scenario, information required to be furnished by us to shareholders and to the SEC would be substantially reduced, and certain provisions of the Exchange Act would no longer apply to us, such as the requirement to file an annual report on Form 20-F with the SEC or to furnish current reports on Form 6-K. Furthermore, the ability of any of our affiliates, as defined in Rule 144(a)(1) of the Securities Act, and persons holding our restricted securities, as defined in Rule 144(a)(3) of the Securities Act, to dispose of such securities pursuant to Rule 144 promulgated under the Securities Act, may be impaired or eliminated.
These factors could adversely affect the liquidity and market value of the ADSs, as well as investors’ ability to trade them, ultimately impacting the price of our securities.
See also “Item 4. Information on the Company—A. History and Development of the Company—Potential Delisting and Deregistration.”
Our ADSs may not be as liquid as our common shares.
Some companies that have issued ADSs on U.S. stock exchanges have experienced lower levels of liquidity in their ADSs than is the case for their equity securities listed on their domestic exchange. There is a possibility that our ADSs, listed on the NYSE, will be less liquid than our common shares listed on the B3. Additionally, our dual stock exchange listings may adversely affect the liquidity of our common shares and ADSs, and result in price differences between the two markets.
There is no guarantee that an active public market in our ADSs will develop or be sustained. If an active market for our ADSs does not develop, the market price and liquidity of our ADSs may be adversely affected. Moreover, differences in trading schedules, as well as exchange rate volatility between the two trading currencies, may result in different trading prices for our common shares and ADSs.
The market price of our common shares and ADSs may be volatile.
The market price of our common shares and ADSs may be volatile. Broad general economic, political, market and industry factors may adversely affect the market price of our common shares and ADSs, regardless of our actual operating performance. Factors that could cause fluctuation in the price of our commons shares and ADSs include:
Shareholders could be diluted in the future, which could also adversely affect the market price of our common shares and ADSs.
It is possible that we may decide to offer additional common shares or ADSs or securities convertible therein in the future either to raise capital or for other purposes. If our shareholders do not take up such offer or are not eligible to participate in such offering, their proportionate ownership and voting interests would be reduced. An additional offering could have a material adverse effect on the market price of our common shares and ADSs.
In addition, according to art. 172 of Law No. 6,404, of December 15, 1976, as amended, or the “Brazilian Corporation Law,” we may not be required to grant preemptive rights to our shareholders in the event of a capital increase through a public offering of shares or securities convertible into shares, which may result in a dilution of our current shareholders’ stake in our company.
Exchange controls and restrictions on remittances abroad may adversely affect holders of our ADSs.
Brazilian laws provide that whenever a serious imbalance in Brazil’s balance of payments exists or is anticipated, the Brazilian federal government may impose temporary restrictions on the repatriation by foreign investors of the proceeds of their investment in Brazil and on the conversion of Brazilian currency into foreign currency. For example, for six months in 1989 and early 1990, the Brazilian federal government restricted all fund transfers that were owed to foreign equity investors and held by the Central Bank of Brazil, to preserve Brazil’s foreign currency reserves. These amounts were subsequently released in accordance with Brazilian federal government directives. Although the Brazilian federal government has never exercised such a prerogative since, we cannot guarantee that the Brazilian federal government will not take similar actions in the future.
You may be adversely affected if the Brazilian federal government imposes restrictions on the remittance to foreign investors of the proceeds of their investments in Brazil and, as it has done in the past, on the conversion of the real into foreign currencies. These restrictions could hinder or prevent the conversion of dividends, distributions or the proceeds from any sale of shares, as the case may be, into U.S. dollars and the remittance of U.S. dollars abroad. We cannot assure that the government will not take this measure or similar measures in the future. Holders of our ADSs could be adversely affected by delays in, or a refusal to grant, any required governmental approval for conversion of real payments and remittances abroad in respect of the shares, including the shares underlying our ADSs. In such a case, the depositary will distribute reais or hold the reais it cannot convert for the account of our ADS holders who have not been paid.
Holders of our ADSs may face difficulties in serving process on or enforcing judgments against us and other persons.
We are organized under, and are subject to, the laws of Brazil, and substantially all our directors and executive officers and our independent registered public accounting firm reside or are based in Brazil. Substantially all of our assets and those of these other persons are located in Brazil. As a result, it may not be possible for holders of the ADSs to effect service of process upon us or these other persons within the United States or other jurisdictions outside Brazil or to enforce against us or these other persons judgments obtained in the United States or other jurisdictions outside Brazil. Because judgments of U.S. courts for civil liabilities based upon the U.S. federal securities laws may only be enforced in Brazil if certain conditions are met, our ADS holders may face greater difficulties in protecting their interests due to actions by us or our directors or executive officers than would shareholders of a U.S. corporation.
The relative volatility and illiquidity of the Brazilian securities markets may adversely affect holders of our common shares and ADSs.
Investments in securities, such as our common shares or ADSs, of issuers from emerging market countries, including Brazil, involve a higher degree of risk than investments in securities of issuers from more developed countries. The Brazilian securities market is substantially smaller, less liquid, more concentrated and more volatile than major securities markets in the United States and other jurisdictions, and may be regulated differently from the ways familiar to U.S. investors. There is also significantly greater concentration in the Brazilian securities market than in major securities markets in the United States.
The uncertainties caused by the outbreak of COVID-19 had an adverse impact on the global economy and global capital markets, including in Brazil, especially during 2020. As a result of this volatility, the B3’s circuit breaker mechanism was triggered eight times during March 2020. The prices of most securities traded on the NYSE and the B3, including the price of our common shares, were adversely affected by the COVID-19 pandemic. Impacts similar to those described above may reoccur, which may result in volatility in the price of our securities traded on the NYSE and on the B3. We cannot assure you that the price of our securities will not fall below the lowest levels at which our securities traded during the ongoing pandemic.
These features may substantially limit the ability to sell our common shares, including in the form of ADSs, at a price and time at which holders wish to do so. A liquid and active market may never develop for the ADSs, and as a result, the ability of holders of our ADSs to sell at the desired price or time may be significantly hindered.
Holders of our ADSs may face difficulties in protecting their interests because we are subject to different corporate rules and regulations than a U.S. company and holders of our ADSs may have fewer and less well-defined rights.
Holders of our ADSs are not our direct shareholders and may be unable to enforce the rights of shareholders under our bylaws and Brazilian law. Holders of our common shares are generally required under our current bylaws to resolve any disputes with us through arbitration. Our corporate affairs are governed by our bylaws and Brazilian law, which differ from the legal principles that would apply if we were incorporated in a jurisdiction in the United States, or elsewhere outside Brazil. Although insider trading and price manipulation are crimes under Brazilian law, the Brazilian securities markets are not as highly regulated and supervised as the U.S. securities markets or the markets in some other jurisdictions. In addition, rules and policies against self-dealing or for preserving shareholder interests may also be less well-defined and enforced in Brazil than in the United States and certain other countries, which may put holders of our ADSs at a potential disadvantage.
Holders of our ADSs do not have the same voting rights as our shareholders.
Holders of our ADSs do not have the same voting rights as holders of our common shares. Holders of our ADSs are entitled to the contractual rights set forth for their benefit under the deposit agreement. ADS holders exercise voting rights by providing instructions to the Depositary, as opposed to attending shareholders’ meetings or voting by other means available to shareholders. In practice, the ability of a holder of ADSs to instruct the Depositary as to voting will depend on the timing and procedures for providing instructions to the Depositary, either directly or through the holder’s custodian and clearing system.
Due to delays in notification to and by the Depositary, holders of our ADSs may not be able to give voting instructions to the Depositary or to withdraw our common shares underlying their ADSs to vote such shares in person, virtually or by proxy.
Despite our efforts, the Depositary may not receive voting materials for our common shares represented by ADSs in time to ensure that holders of such ADSs can either instruct the Depositary to vote our common shares underlying their ADSs or withdraw such shares to vote them in person, virtually or by proxy.
In addition, the Depositary’s liability to holders of ADSs for failing to execute voting instructions, or for the manner in which voting instructions are executed, is limited by the deposit agreement for the ADSs. As a result, holders of our ADSs may not be able to exercise their rights to give voting instructions, or to vote in person, virtually or by proxy, and may not have any recourse against the Depositary or us if our common shares underlying their ADSs are not voted as they have requested or if our common shares underlying their ADSs cannot be voted.
An exchange of ADSs for common shares risks the loss of certain foreign currency remittance advantages.
Holders of our ADSs benefit from the certificate of foreign capital registration, which permits the Depositary to convert dividends and other distributions with respect to common shares into foreign currency, and to remit the proceeds abroad. Holders of our ADSs who exchange their ADSs for common shares will then be entitled to rely on the Depositary’s certificate of foreign capital registration for five business days from the date of exchange. Thereafter, they will not be able to remit non-Brazilian currency abroad unless they obtain their own certificate of foreign capital registration, or unless they qualify under Resolution No. 4,373/2014 of the CMN, which entitles certain investors to buy and sell shares on Brazilian stock exchanges without obtaining separate certificates of registration. There can be no assurance that the certificate of registration of the Depositary, or any certificate of foreign capital registration obtained by holders of our ADSs, will not be affected by future legislative or regulatory changes, or that additional Brazilian law restrictions applicable to their investment in our ADSs may not be imposed in the future.
Holders of our ADSs may not be able to exercise the preemptive rights relating to the common shares.
Holders of our ADSs may not be able to exercise the preemptive rights relating to the common shares underlying their ADSs unless a registration statement under the Securities Act is effective with respect to the rights or an exemption from the registration requirements of the Securities Act is available. We are not obligated to file a registration statement with respect to the shares or other securities relating to these preemptive rights, and we cannot assure holders of the ADSs that we will file any such registration statement. Unless we file a registration statement or an exemption from registration applies, holders of our ADSs may receive only the net proceeds from the sale of their preemptive rights by the Depositary or, if the preemptive rights cannot be sold, the rights will be allowed to lapse.
The holders of our common shares (including the common shares underlying the ADSs) may not receive dividends or interest on own capital.
According to our current bylaws, our shareholders are entitled to receive a mandatory minimum annual dividend equal to 25% of our annual net profit, calculated and adjusted under the terms of the Brazilian Corporation Law. Our current bylaws allow for the payment of intermediary dividends, to the retained earnings account or the existing earnings reserves in the last yearly or six-month balance, by means of the annual dividend. We may also pay interest on own capital, as described by Brazilian law. The intermediary dividends and the interest on own capital declared in each fiscal period may be imputed to the mandatory dividend that results from the fiscal period in which they are distributed. At the general shareholders’ meeting, shareholders may decide on the capitalization, on the offset of our losses or on the net profit retention, as provided for in the Brazilian Corporation Law, with the aforementioned net profit not being made available for the payment of dividends or interest on own capital.
In addition, Brazilian Corporation Law allows publicly held companies, like us, to suspend the required minimum distribution of dividends. The payment of dividends may be suspended if our management reports at an annual shareholders’ meeting that such distribution would be inadvisable in view of our financial condition and has provided the shareholders at the annual general shareholders’ meeting with an opinion to that effect, which has been reviewed by our fiscal council, if installed. In addition, our management must submit a report to the CVM within five days following said meeting clarifying the reasoning for any such non-payment. If the abovementioned occurs, holders of the common shares (including the common shares underlying the ADSs) may not receive dividends or interest on own capital.
Judgments of Brazilian courts with respect to our shares will be payable only in reais.
If proceedings are brought in the courts of Brazil seeking to enforce our obligations in respect of the common shares, we will not be required to discharge our obligations in a currency other than reais. Under Brazilian exchange control limitations, an obligation in Brazil to pay amounts denominated in a currency other than reais may only be satisfied in Brazilian currency at the exchange rate, as determined by the Central Bank of Brazil, in effect on the date the judgment is obtained, and such amounts are then adjusted to reflect exchange rate variations through the effective payment date. The then-prevailing exchange rate may not afford non-Brazilian investors with full compensation for any claim arising out of or related to our obligations under the ADSs.
As a foreign private issuer, we have different disclosure and other requirements than U.S. domestic registrants.
As a foreign private issuer under the Exchange Act, we may be subject to different disclosure and other requirements than U.S. domestic registrants. For example, as a foreign private issuer in the United States, we are not subject to the same disclosure requirements as a U.S. domestic registrant under the Exchange Act, including the requirements to prepare and issue quarterly reports on Form 10-Q or to file current reports on Form 8-K upon the occurrence of specified significant events, the proxy rules applicable to U.S. domestic registrants under Section 14 of the Exchange Act or the insider reporting and short-swing profit rules applicable to U.S. domestic registrants under Section 16 of the Exchange Act. In addition, we rely on exemptions from certain U.S. rules, which permit us to follow Brazilian legal requirements rather than certain of the requirements that are applicable to U.S. domestic registrants.
Furthermore, foreign private issuers are required to file their annual report on Form 20-F within 120 days following the end of each fiscal year, while U.S. domestic issuers that are accelerated filers are required to file their annual report on Form 10-K within 75 days following the end of each fiscal year. As a result of the above, even though we are required to make submissions on Form 6-K disclosing the information that we have made or are required to make public pursuant to Brazilian law, or are required to distribute to shareholders generally, and that is material to us, you may not receive information of the same type or amount that is required to be disclosed to shareholders of a U.S. company.
We are a foreign private issuer and, as a result, in accordance with the listing requirements of the NYSE, we rely on certain home country governance practices from Brazil, rather than the corporate governance requirements of the NYSE.
We report under the Exchange Act as a non-U.S. company with foreign private issuer status. The NYSE rules provide that foreign private issuers are permitted to follow home country practice in lieu of certain NYSE corporate governance standards. The standards that are applicable to us are considerably different than the standards applied to U.S. domestic issuers. For instance, we are not required to:
As a foreign private issuer, we may follow our home country practice in Brazil (including the rules and regulations of the B3 and the CVM) in lieu of the above requirements. Therefore, the approach to governance adopted by our board of directors may be different from that of a board of directors consisting of a majority of independent directors, and, as a result, our management oversight may be more limited than if we were subject to all of the NYSE corporate governance standards. Accordingly, you may not have the same protections afforded to shareholders of companies that are not foreign private issuers. See “Directors, Senior Management and Employees—C. Board Practices—Summary of Significant Differences of Corporate Governance Practices.”
Holders of Cosan ADSs may not be entitled to a jury trial with respect to claims arising under the deposit agreement, which could result less favorable results to the plaintiff(s) in any such action.
The deposit agreement governing the Cosan ADSs representing the Cosan common shares provides that holders and beneficial owners of Cosan ADSs irrevocably waive the right to a trial by jury in any legal proceeding arising out of or relating to the deposit agreement, the Cosan common shares or the Cosan ADSs or the transactions contemplated thereby, including claims under U.S. federal securities laws, against us or the Depositary to the fullest extent permitted by applicable law. The waiver continues to apply to claims that arise during the period when a holder holds the Cosan ADSs, whether the holder of Cosan ADSs acquired the Cosan ADSs pursuant to the Merger or in secondary transactions. If this jury trial waiver provision is prohibited by applicable law, an action could nevertheless proceed under the terms of the deposit agreement with a jury trial. To our knowledge, the enforceability of a contractual pre-dispute jury trial waiver in connection with claims arising under the U.S. federal securities laws has not been finally adjudicated by the United States Supreme Court. However, we believe that a jury trial waiver provision is generally enforceable under the laws of the State of New York, which govern the deposit agreement, by a court of the State of New York or a federal court in New York, which have jurisdiction over matters arising under the deposit agreement, applying such law. In determining whether to enforce a jury trial waiver provision, New York courts and federal courts will consider whether the visibility of the jury trial waiver provision within the agreement is sufficiently prominent such that a party has knowingly waived any right to trial by jury. We believe that this is the case with respect to the deposit agreement, the Cosan common shares and the Cosan ADSs and the transactions contemplated thereby. In addition, New York courts will not enforce a jury trial waiver provision to bar a viable setoff or counterclaim sounding in fraud or one which is based upon a creditor’s negligence in failing to liquidate collateral upon a guarantor’s demand, or in the case of an intentional tort claim (as opposed to a contract dispute), none of which we believe are applicable in the case of the deposit agreement, the Cosan common shares or the Cosan ADSs or the transactions contemplated thereby. No condition, stipulation or provision of the deposit agreement or Cosan ADSs serves as a waiver by any holder or beneficial owner of Cosan ADSs or by us or the depositary of compliance with any provision of the U.S. federal securities laws. If you or any other holder or beneficial owner of Cosan ADSs brings a claim against us or the Depositary in connection with matters arising under the deposit agreement, the Cosan common shares or the Cosan ADSs or the transactions contemplated thereby, you or such other holder or beneficial owner may not be entitled to a jury trial with respect to such claims, which may result in increased costs to bring a claim, and have the effect of limiting and discouraging lawsuits against us and/or the Depositary. If a lawsuit is brought against us and/or the Depositary under the deposit agreement, it may be heard only by a judge or justice of the applicable trial court, which would be conducted according to different civil procedures and may augur different results than a trial by jury would have had, including results that could be less favorable to the plaintiff(s) in any such action.
Although we do not expect that we were a PFIC in 2025 there is risk that we were a PFIC for 2025 and that we will be a PFIC for 2026 or in future taxable years, which could result in adverse U.S. federal income tax consequences to U.S. investors in our common shares or ADSs.
In general, a non-U.S. corporation will be a “passive foreign investment company,” or “PFIC,” for U.S. federal income tax purposes for any taxable year in which, after applying certain look-through rules, either (1) at least 75% of its gross income is “passive income” or (2) at least 50% of the average quarterly value of its assets consists of assets that produce “passive income” or are held for the production of “passive income.” For purposes of these calculations, a non-U.S. corporation that owns (or is treated as owning for U.S. federal income tax purposes), directly or indirectly, at least 25% by value of the stock of another corporation is treated as if it held its proportionate share of the assets of the other corporation and received directly its proportionate share of the income of the other corporation. On the other hand, an equity investment in a corporation representing less than 25% by value of that corporation is generally treated as a passive asset for purposes of the PFIC rules. Passive income for this purpose generally includes dividends, interest, royalties, rents and gains from foreign currency, securities and certain commodities transactions. In addition, the value of a company’s goodwill is an active asset under the PFIC rules to the extent attributable to activities that produce active income.
We expect that we were not a PFIC for our taxable year ended December 31, 2025. However, we cannot assure you that we will not be considered a PFIC for the 2025 taxable year or 2026 or any future taxable year. Our PFIC status for any taxable year is an annual factual determination that can be made only after the end of that year and depends on the composition of our income and assets and the value of our assets from time to time. Moreover, we hold significant minority investments in certain entities (representing less than 25% by value of the entity’s equity). Accordingly, our PFIC status for any taxable year will depend in part on the value of those minority investments relative to the value of our active assets, including goodwill. The value of our goodwill may be determined, in large part, by reference to our market capitalization. If the value of our minority (less-than-25%-owned) equity investments were to increase relative to our active assets (in particular, if our market capitalization were to decline), we could be treated as a PFIC for our taxable year 2026 and/or future taxable years. Thus, we cannot assure you that we will not be considered a PFIC for any taxable year. If we are a PFIC for any taxable year during which you hold common shares or ADSs, you generally will be subject to adverse U.S. federal income tax consequences, including increased tax liability on disposition gains and “excess distributions,” and additional reporting requirements. This will generally continue to be the case even if we ceased to be a PFIC in a later taxable year, unless certain elections are made. See “Taxation—U.S. Federal Income Tax Considerations—Passive Foreign Investment Company Rules.”
General
We are a publicly-held company incorporated under the laws of Brazil on July 8, 1966 for an indefinite term. Cosan S.A. is registered with the Junta Comercial do Estado de São Paulo in Brazil under registration number 35.300.177.045. Our legal name is Cosan S.A. and our commercial name is “Cosan.” Our registered office is located at Av. Brigadeiro Faria Lima, 4,100 – 16th floor, São Paulo – SP, 04538-132, Brazil and our general telephone and fax numbers are 55 11 3897-9797 and 55 11 3897-9799, respectively. Our website is https://www.cosan.com.br/en. In addition, the SEC maintains a website that contains information which we have filed electronically with the SEC, including our annual reports, periodic reports and other filings, which can be accessed at https://www.sec.gov. The information contained on our website, any website mentioned in this annual report or any website directly or indirectly linked to these websites, is not part of, and is not incorporated by reference in, this annual report and you should not rely on such information.
See also Exhibit 8.1 to this annual report, which contains a list of our subsidiaries.
History
Over the last decades, we have transitioned from being a sugar and alcohol producer with a complex corporate structure, into a streamlined group of publicly held companies operating in the natural resources sectors in which Brazil has a global competitive advantage. Our history dates back to 1936 when the Costa Pinto mill was established by the Ometto family in the city of Piracicaba in the State of São Paulo. As of the mid-1980s, we began to expand our operations through the acquisition of various milling facilities in the State of São Paulo and, in 2000, we consolidated the activities of our sugar and alcohol conglomerate into a single company, which was named Cosan S.A. Indústria e Comércio, currently Cosan S.A. We began diversifying our portfolio in 2008 with the acquisition of Exxon Mobil assets in Brazil, and the creation of Rumo and Radar, enabling us to focus on fuel distribution, sugarcane transport and operation, and management of agricultural properties, respectively. In 2011, we successfully completed the formation of the joint venture with Shell for the incorporation of Raízen, which combined our sugar and ethanol and fuel distribution assets with Shell’s fuel distribution operations in Brazil. The remaining Exxon Mobil assets were contributed to the creation of Moove, which today operates in several countries in the Americas and Europe producing and distributing high-quality lubricants. As part of our strategy to consolidate as an energy business, we acquired Comgás and contributed its shares to Compass, which leverages its strategic portfolio of assets for the distribution and marketing of natural gas.
In 2021, we (i) reorganized our corporate structure to optimize investments across the group and consolidate the various free floats of our businesses, and (ii) obtained the registration of Raízen as a “category A” publicly held company with the CVM and completed the IPO of its preferred shares, allowing for the capitalization of Raízen’s business while maintaining the original control arrangement among its shareholders.
In October 2022, we announced the acquisition of a 4.96% equity interest in Vale’s outstanding share capital (4.85% of its total share capital). As of December 31, 2023, we had a 4.90% in Vale’s share capital. On April 19, 2024 we concluded the sale of 33,524,185 shares of Vale, as a result of which our interest in Vale’s share capital decreased to 4.15% as of December 31, 2024. On January 16, 2025, we concluded the sale of 173,073,795 shares of Vale, representing approximately 4.05% of its voting capital. Combined with certain other sales of Vale prior to such date, this reduced our stake to 4,268,720 shares of Vale, corresponding to 0.10% of Vale’s share capital. See “Presentation of Financial and Certain Other Information—Certain Corporate Events—Disposition of Significant Interest in Vale S.A., or ‘Vale.’”
On December 23, 2022, Banco Bradesco BBI S.A. invested R$4.0 billion in preferred shares representing 23.2% of the share capital of our subsidiary Cosan Dez Participações S.A., or “Cosan Dez,” which holds 88.0% of Compass’ shares. As the holder of preferred shares in Cosan Dez, Banco Bradesco BBI S.A. has a preferential right to the receipt of dividends or other distributions from Cosan Dez. We have also entered into a shareholders’ agreement with Banco Bradesco BBI S.A. with respect to Cosan Dez. In addition, on December 28, 2022, Itaú Unibanco S.A. invested R$4.1 billion in preferred shares representing 26.9% of the share capital of our subsidiary Cosan Nove Participações S.A., or “Cosan Nove,” which holds 39.0% of Raízen’s shares. As the holder of preferred shares in Cosan Nove, Itaú Unibanco S.A. has a preferential right to the receipt of dividends or other distributions from Cosan Nove. We have also entered into a shareholders’ agreement with Itaú Unibanco S.A. with respect to Cosan Nove. On March 31, 2025, the Company acquired a portion of the preferred shares issued by Cosan Nove S.A. to Itaú Unibanco S.A. in December 2022 for a total amount of R$2.2 billion.
In 2023, we (i) sold all of our equity interest in Sinlog Tecnologia em Logística S.A. or “Trizy”; (ii) issued our fifth, seventh, eighth and ninth issuance of debentures, in an aggregate principal amount of R$1 billion, R$1.5 billion, R$1.3 billion and R$2.9 billion, respectively; (iii) internalized the remaining resources from the issuance of our 2030 senior notes, through the issuance of debentures by Cosan S.A., referenced in U.S. dollars in the amount of R$1,491 million (equivalent to approximately U.S.$300 million); (iv) issued U.S.$550.0 million in aggregate principal amount of 7.500% notes due 2030, the net proceeds of which were used to pay the tender price of our then-outstanding 7.00% Senior Notes due 2027, or the “2027 Notes,” tendered in connection with the tender offer for such notes which expired in July 2023; and (v) issued unsecured commercial paper, in two series, in an aggregate principal amount of R$1 billion, accruing interest at a rate equal to the DI. For more information, see “Item 5. Operating and Financial Review and Prospects—B. Liquidity and Capital Resources—Indebtedness.”
On September 16, 2024, Compass concluded the acquisition of 51% of the share capital and control of Compagas for R$962.1 million. On November 6, 2024, Compass concluded the strategic sale of its 51% stake in Norgás S.A., or Norgás, to Infra Gás e Energia S.A. Norgás has a 29.4% equity interest in Companhia de Gás do Ceará – Cegás, an 83% equity interest in Companhia Potiguar de Gás – Potigás, a 29.4% equity interest in Gás de Alagoas S.A. – Algás, a 41.5% equity interest in Sergipe Gás S.A. – Sergás and a 41.5% equity interest in Companhia Pernambucana de Gás – Copergás. The purchase price for the sale was paid in full on November 6, 2024.
On September 29, 2024, Cosan Lubrificantes e Especialidades S.A, or CLE, a subsidiary of Moove, entered into a purchase and sale agreement to acquire 100% of the shares of DIPI Holdings S.A. for the price of R$410.0 million, R$329.0 million of which would be payable in cash, which after debt and working capital adjustments on the closing date resulted in a disbursement of R$232.9 million, and an earn-out payment of up to R$96.1 million to be paid in two installments until 2027. The group is made up of three operating companies: Pax Lubrificantes Ltda., Elvin Lubrificantes Industria e Comercio Ltda. and Lubripack Industria e Comercio Ltda., which manufacture and sell greases and lubricating oils for automotive and industrial use, as well as a plastic blow molding unit. The transaction closed on January 2, 2025 after the applicable conditions precedent were met.
In 2024, we entered into certain additional financings, as described under “Item 5. Operating and Financial Review and Prospects—B. Liquidity and Capital Resources—Indebtedness,” including (i) the issuance of U.S.$600.0 million in aggregate principal amount of 7.250% notes due 2031, which were delivered to investors on January 26, 2024 and which proceeds were used for general corporate purposes, (ii) the issuance of R$1.45 billion in unsecured, non-convertible debentures in two series in June 2024, and (iii) the issuance of R$2.5 billion in unsecured, non-convertible debentures in three series in October 2024.
In 2025, we also entered into certain additional financings, as described under “Item 5. Operating and Financial Review and Prospects—B. Liquidity and Capital Resources—Indebtedness.” In addition, our subsidiary Cosan Luxembourg S.A., or Cosan Luxembourg, (i) redeemed the full outstanding amount of U.S.$392.0 million of senior notes maturing due 2027, (ii) conducted a tender offer pursuant to which it purchased (iii) U.S.$236.5 million aggregate principal amount of its outstanding U.S.$740.8 million 5.500% senior notes due 2029, U.S.$273.2 million aggregate principal amount of its outstanding U.S.$550.0 million 7.500% senior notes due 2030, and U.S.$269.3 million aggregate principal amount of its outstanding U.S.$600.0 million 7.250% senior notes due 2031.
On September 4, 2025, Raízen announced that it has agreed to terminate its proximity retail joint venture, Rede Integrada de Lojas de Conveniências e Proximidade S.A., or Grupo Nós, a 50%-50% joint venture between Raízen and FEMSA Comercio, S.A. de C.V., or FEMSA Comercio. The termination will be structured as a share exchange with no cash consideration whereby (i) Raízen will receive 1,256 Shell Select and Shell Café convenience stores and will continue to develop its offering through the priority franchise model, integrated into its Shell service station network, and (ii) FEMSA will receive 611 Oxxo proximity markets and the distribution center located in Cajamar, in the State of São Paulo, in addition to Grupo Nós’ existing debt and cash. As part of the agreement, Grupo Nós will continue to provide supply and logistics services related to the product portfolio currently offered through its distribution center, within its coverage area, to the Shell Select and Shell Café convenience stores. The completion of the transaction is subject to approval by the Brazilian Antitrust Authority and other customary conditions precedent.
In September 2025, we announced a strategic agreement with anchor investors — represented by the Aguassanta holding companies and institutional funds from BTG Pactual Holding and Perfin Infra — to conduct two primary public offerings of shares. As part of this arrangement, Vertiz Holding S.A. (“Vertiz”) was incorporated as a new holding company to consolidate these investors' joint ownership interest in the Company. In November 2025, the offerings were completed at a price of R$5.00 per share. The first offering issued 1,812,500,000 common shares raising R$9,062.5 million. The anchor investors subscribed for 1,450,000,000 shares through Vertiz, subject to a four-year lock-up on half of the shares. The second offering resulted in the issuance of 287,500,000 shares, raising R$1,437.5 million, with preemptive rights granted to existing shareholders. On November 7, 2025, a shareholders’ agreement was signed between the Aguassanta holdings, the investing funds, and Vertiz. With a twenty-year term, the agreement established a bound vote for 1,125,184,190 shares (28.42% of total share capital following both offerings, excluding treasury shares). The offerings resulted in total net proceeds of R$10,270.0 million, of which R$8,170.0 million was allocated to the capital reserve and R$2,100.0 million to share capital. Consequently, the share capital increased from R$8,182.7 million to R$10,282.7 million, with a total issuance of 2,100,000,000 new shares. The net proceeds were earmarked for strengthening the capital structure, credit profile, and liquidity of the Company and its subsidiaries.
On January 30, 2026, Vertiz redeemed Class C and Class D registered preferred shares by delivering shares issued by the Company to the respective holders, reducing its direct stake in Cosan from 36.56% to 24.19%. As a result, FIP BTG Pactual Multiestratégia III (BPAC3) came to hold directly holds 8.36% of Cosan’s voting capital, alongside other BTG Pactual funds (1.31% and 0.86%) and Perfin Rally FIP (1.83%).
Certain changes to our management took place in the last quarter of 2025. Since December 5, 2025, Rafael Bergman has been serving as our Chief Financial and Investor Relations Officer, succeeding Rodrigo Araujo Alves. In addition, effective November 19, 2025, André Santos Esteves was elected Vice-Chairman of our board of directors, while Renato Antônio Secondo Mazzola and Ralph Gustavo Rosenberg were elected as members, following the resignations of Pedro Isamu Mizutani, Luis Henrique Cals de Beauclair Guimarães, Silvia Brasil Coutinho and Vasco Augusto Pinto da Fonseca Dias Júnior. These changes are mirrored across the boards of our subsidiaries, including Rumo, Compass and Raízen. Furthermore, Rodrigo Araujo Alves also resigned from his director position at Moove, where Renato Antônio Secondo Mazzola and Ralph Gustavo Rosenberg were appointed as directors.
In December 2025, the Company disposed of a total of 184,700,000 shares of Rumo through an auction on B3, equivalent to 9.94% of Rumo's share capital. Simultaneously, on December 15 and 22 of the same month, it entered into total return swap (“TRS”) transactions with Banco Santander (Brasil) S.A. (“Santander”) and BNP Paribas Brasil S.A. (“BNP”). The contracts had as underlying assets 92,500,000 and 92,200,000 Rumo common shares, respectively, totaling a notional amount of R$2,794.7 million. The TRS agreements, maturing in January 2027, provide economic exposure to share price fluctuations and distributions in exchange for payment of a rate equivalent to the Brazilian Interbank Deposit Certificate (“CDI”) rate plus a spread. The contracts were accounted for as financing arrangements, with Rumo shares pledged as collateral, and the corresponding financial liability was classified and subsequently measured at amortized cost.
Although the formal disposal of the shares occurred in the market, there was no substantial transfer of risks and rewards associated with the original investment, due to the simultaneous execution of TRS agreements that restored the Company’s full economic exposure to the disposed shares. Accordingly, derecognition of the investment in the subsidiary did not occur, and Rumo continues to be fully consolidated.
Upon settlement of these contracts, the Company will have no obligation to repurchase the shares.
Total net proceeds from the transaction, after transaction costs, amounted to R$2,792.9 million. After interest adjustments, the final balance on December 31, 2025, was R$2,804.6 million.
On December 30, 2025, at an extraordinary general meeting of our subsidiary Cosan Dez, shareholders approved (i) a share capital increase of R$153.6 million through the issuance of 30,675,567 no-par-value common shares, and (ii) an interim dividend distribution totaling R$623.6 million, paid exclusively to holders of Cosan Dez non-voting preferred shares. On the same date, Cosan Dez approved: (i) the repurchase of Class A preferred shares through payment of R$ 3,577.8 million to Bradesco BBI S.A., or “Bradesco,” resulting in a change in ownership interest of R$2,655.1 million; (ii) the creation of four new classes of preferred shares – Class A, Class B, Class C, and Class D – all with restricted voting rights; and (iii) the voluntary conversion of 174,856,299 common shares into Class A preferred shares and another 174,856,299 common shares into Class B preferred shares. Also on December 30, 2025, Cosan entered into a shareholders’ agreement with Bradesco and BTG Holding regarding Cosan Dez. Under the agreement, Bradesco acquired 174,856,299 Class A preferred shares for R$2,000.0 million, and BTG acquired 174,856,299 Class B preferred shares for R$2,000.0 million. The agreement includes (i) a put option that gives the investors the right to require the Company to repurchase the preferred shares on the dates stipulated in the contract and (ii) a call option that gives the Company the right to repurchase the preferred shares on the same dates. Because exercise of the put option is substantively inevitable after the contractual term, the Company recognized a financial liability of R$ 3,844.6 million. This amount represents the present value of the obligation to repurchase the shares issued by subsidiary Cosan Dez. The liability is classified as a non-current liability in the line item “Put option liability on subsidiary shares”. The investment in Cosan Dez continues to be fully recognized as a non-current asset, with transaction costs amortized using the effective interest method. On February 19, 2026, Bradesco exercised its conversion right under the shareholders’ agreement and converted its Class B preferred shares in Cosan Dez—representing 4.99% of the subsidiary’s share capital—into Class D preferred shares. Following the conversion, these shares represent 11.50% of Cosan Dez’s share capital. The transaction was completed in accordance with the terms of the existing shareholders’ agreement.
On January 16, 2026, we approved the voluntary early redemption of all outstanding debentures issued under the first series of our fourth issuance and our sixth issuance, each consisting of simple, unsecured debentures not convertible into shares. The redemptions were completed on February 2, 2026.
On January 30, 2026, we were notified of a reorganization of equity interests among members of our control group pursuant to a shareholders’ agreement entered into on November 7, 2025. As a result, Vertiz Holding S.A. reduced its direct interest in our total share capital from approximately 36.56% to 24.19%, and FIP BPAC3 began holding approximately 8.36% of our total share capital. These changes did not result in any modification of our ultimate control structure, and the shares subject to the shareholders’ agreement continue to be voted jointly.
On February 9, 2026, through our wholly owned subsidiary Cosan Luxembourg S.A., we redeemed in full our senior notes due June 2030, with an outstanding principal amount of approximately U.S.$269.3 million, and our senior notes due January 2031, with an outstanding principal amount of U.S.$300.0 million.
On February 17, 2026, we redeemed our senior notes due 2029, with an outstanding principal amount of approximately U.S.$504.2 million. Following these transactions, which were part of our ongoing liability management strategy aimed at reducing leverage and improving financial flexibility, we had repaid approximately R$6.2 billion of debt under our broader liability management program initiated in 2025. These measures were undertaken to reduce our gross debt and strengthen our capital structure.
On February 23, 2026, we began evaluating a potential initial public offering of shares of Compass Gás e Energia S.A., our natural gas platform.
On March 11, 2026, Raízen and certain subsidiaries filed a request for an out-of-court reorganization proceeding (recuperação extrajudicial), before the São Paulo State Court, Capital District, pursuant to Brazilian Law No. 11,101/05. Based on information available as of December 31, 2025, the investment in Raízen was reduced to zero on the Company’s balance sheet, with no additional liability recognized, as the Company concluded, jointly with its legal advisors, through a review of contracts, corporate documents, and other documents related to Raízen, that it has no legal or constructive obligations to provide financial support to Raízen. The evolution of Raízen’s corporate and financial restructuring process will continue to be monitored by management, with any potential impacts to be recognized in the periods in which they occur. For additional information, see “Presentation of Financial and Other Information—Certain Corporate Events—Out-Of-Court Reorganization of Raízen.”
Potential Delisting and Deregistration
On October 24, 2025, we announced to the market that we are considering taking certain actions to cause the delisting of our ADSs from the NYSE. If we do pursue this delisting, the ADSs would cease to be tradeable on the NYSE and listing of our securities would be restricted to the listing of the common shares on the B3. We would also no longer be required to follow the mandatory corporate governance standards promulgated by the listing rules of the NYSE. Additionally, if we meet the applicable criteria at any time after completing such delisting, we may pursue the deregistration of our common shares and ADSs with the SEC, resulting in the suspension of our reporting obligations with the SEC and ultimately the extinction thereof. As a result, the information required to be furnished by us to shareholders and to the SEC would be substantially reduced, and certain provisions of the Exchange Act would no longer apply to us, such as the requirement to file an annual report on Form 20-F with the SEC or to furnish current reports on Form 6-K. Furthermore, the ability of any of our affiliates, as defined in Rule 144(a)(1) of the Securities Act, and persons holding our restricted securities, as defined in Rule 144(a)(3) of the Securities Act, to dispose of such securities pursuant to Rule 144 promulgated under the Securities Act, may be impaired or eliminated.
Investment Agreement
On September 21, 2025, the Company, Aguassanta Investimentos S.A., a corporation (sociedade anônima) of indefinite term incorporated under the laws of Brazil, or “AS Investimentos,” and Queluz Holdings Limited, a business company organized under the laws of the British Virgin Islands, or “Queluz” and, together with AS Investimentos, “Holdings Aguassanta,” entered into an investment agreement (Acordo de Investimento e Outras Avenças), or the “Investment Agreement,” with Classe Única BTG Pactual Infraestrutura III Fundo de Investimento em Participações Multiestratégia, Classe Única Fundo de Investimento em Participações BPAC3 – Multiestratégia Responsabilidade Limitada, and BTG Pactual Co-Investimento Cosan Fundo de Investimento em Participações Multiestratégia Responsabilidade Limitada, collectively, the “BTG Entities,” and Classe A do Perfin Rally Fundo de Investimento em Participações Multiestratégia Responsabilidade Limitada, collectively, “the Perfin Entities” and, collectively with the BTG Entities, the “Investors” and, the Investors, collectively with Holdings Aguassanta, the “Strategic Investors.” Each of AS Investimentos and Queluz is controlled by Rubens Ometto Silveira Mello, our chairman and controlling shareholder. The Investors are strategic business groups that hold diversified and infrastructure-related investments and aim to contribute to the strengthening of corporate governance and the execution of the Company’s long-term strategy.
The purpose of the Investment Agreement was to structure a strategic transaction involving two primary public offerings of common shares by the Company in Brazil, subject to the terms and conditions of the Investment Agreement and the requisite corporate approvals, as further described below.
Primary Equity Offerings of Common Shares
The first public offering of common shares, or the “First Offering,” was structured by the Company in Brazil as an Issuer with Large Market Exposure (Emissora com Grande Exposição ao Mercado – EGEM), in accordance with Resolution No. 160/22 of the CVM. The First Offering was made to the general investing public in Brazil without priority rights for the Company’s shareholders and resulted in a primary issuance of 1,812,500,000 common shares, including a base offering of 1,450,000,000 common shares, or the “First Base Offering,” which was increased by 25.0%, or 362,500,000 common shares, during the bookbuilding process. Our board of directors approved the price per share in the First Offering of R$5.00 per share following the conclusion of the bookbuilding process as well as the issuance of 1,812,500,000 common shares, resulting in gross proceeds of R$9,062.5 million. The common shares issued in the First Offering began trading on the B3 on November 7, 2025, and settlement of the First Offering occurred on November 10, 2025. The First Offering was anchored by the Strategic Investors and the distribution plan also took into account the Company’s historical shareholder base.
The second public offering of common shares, or the “Second Offering,” was also structured by the Company in Brazil. This Second Offering was made to professional investors, pursuant to CVM Resolution No. 160/22, and included priority rights for subscription, granted to shareholders holding common shares in the Company as of the close of business on September 19, 2025, excluding any common shares subscribed in the First Offering. Pursuant to the Investment Agreement, the Investors waived any priority rights in connection with the Second Offering. The Second Offering resulted in a primary issuance of 287,500,000 common shares. The price per share in the Second Offering is the same price per share set in connection with the First Offering, R$5.00 per share. Together, the First Offering and the Second Offering are referred to as the “Equity Offerings.”
Strategic Investors’ Investment
The Strategic Investors subscribed and paid for 100% of the 1,450,000,000 common shares offered in the First Base Offering for a total aggregate amount of R$7,250.0 million. The investment by the Strategic Investors was made through Vertiz Holding S.A., a newly established holding company established with the corporate purpose of holding and investing in the Company’s securities, or “New Holding,” in which Holdings Aguassanta also holds a stake. The Investors have made contributions to the New Holding in amounts corresponding to their respective investment commitments.
New Holding’s share capital consists of different classes of shares, each with distinct economic rights designed to reflect the participation and investment goals of each investor. The redemption and equalization mechanisms applicable to New Holding’s preferred shares are structured to reflect the long-term nature of the investment—estimated at up to 20 years—and to ensure economic alignment and balance among shareholders. Early redemptions may occur upon mutual agreement among the investors, under certain conditions, provided that the long-term investment focus and alignment of interests originally envisaged for the transaction are maintained.
Investors in the First Offering, other than the Strategic Investors, will not be able to offer, sell, contract to sell, pledge, loan or otherwise transfer or dispose of a number of common shares equal to 50% of the total number of common shares subscribed by such investors in the First Offering for a period of two years from the settlement date of the First Offering. Furthermore, the Strategic Investors have agreed that the lock-up applicable to 50% of the common shares subscribed by New Holding in the First Offering will be for a period of four years from the settlement date of such offering. The remaining 50% of the common shares subscribed by New Holding will be subject to a contractual lock-up period of 100 days from the settlement date of the First Offering. In addition, pursuant to the terms of the shareholders’ agreement executed on November 7, 2025, and which came into effect on the settlement date of the First Offering, i.e., November 10, 2025, between Holdings Aguassanta, New Holding and the Investors, as well as the Company and Rubens Ometto Silveira Mello as intervening-consenting parties, or the “Shareholders’ Agreement,” our common shares held by New Holding and Holdings Aguassanta following the First Offering that are subject to the Shareholders’ Agreement will be subject to a four-year lock-up period from the date of execution of the Shareholders’ Agreement. The common shares issued in the Second Offering are not subject to any lock-up restrictions.
See “Item 7. Major Shareholders and Related Party Transactions—A. Major Shareholders—Shareholders’ Agreements and Other Arrangements—Shareholders’ Agreement with the BTG Entities and the Perfin Entities” for additional information on the Shareholders’ Agreement.
Purpose of the Equity Offerings and Investors Involved
In preparation for the First Offering, the Company evaluated potential alternatives to adjust its capital structure. Together with its controlling shareholder, the Company conducted a private process to identify potential Strategic Investors, with the goal of: (i) structuring primary funding sufficient to materially deleverage the Company’s capital structure; (ii) unlocking value for shareholders by restoring financial flexibility and enhancing the liquidity of the Company’s shares; (iii) seeking that the investors contribute to the alignment and strengthening of corporate governance and to the execution of the Company’s long-term strategic objectives; and (iv) promoting a long-term commitment from investors, including the execution of lock-up agreements relating to a significant portion of the investment in our common shares pursuant to a Shareholders’ Agreement to be entered into with Holdings Aguassanta.
Following an evaluation of, and negotiation with, potential investors, the Company and Holdings Aguassanta have entered into the Investment Agreement with the Investors—business groups with a long-term investment profile and recognized financial capacity, ensuring credibility and stability for the transaction. The involvement of these Investors is expected to preserve balance between shareholder stability and market liquidity as a result of their commitment to a longer lock-up period.
Corporate Approvals and Conditions Precedent for the Investment
On October 23, 2025, the Company approved, at an extraordinary general shareholders’ meeting: (i) the increase of the Company’s authorized capital limit, allowing it to be raised to up to 8,000,000,000 common shares through a resolution of the board of directors, without the need for an amendment of the Company’s bylaws (estatuto social); and (ii) the granting of an express waiver, solely to the Investors, from the requirement to conduct a tender offer upon reaching a relevant ownership interest, in light of the fact that the Strategic Investors, directly and through New Holding, and/or their respective shareholder groups may individually or jointly, directly or indirectly, acquire ownership interests in the Company deemed to be relevant under the Company’s bylaws as a result of the Equity Offerings.
In addition, the conduct of the Equity Offerings was subject to customary conditions precedent for transactions of this nature, as well as: (i) the conduct of the First Offering with a minimum of 1,450,000,000 shares issued; and (ii) the settlement of the First Offering occurring no later than November 14, 2025.
Capital Expenditures
For a description of our main capital expenditures over the fiscal years ending December 31, 2025, 2024 and 2023, see “Item 5. Operating and Financial Review and Prospects—B. Liquidity and Capital Resources—Capital Expenditures.” For more information concerning our principal capital expenditures currently in progress, see “—D. Property, Plant and Equipment—Capital Expenditures.”
We are a holding company, and the following companies are part of our group: Raízen (which is under joint control), Compass and its subsidiaries Comgás, Commit Gás e Energia S.A., or “Commit” (previously known as Petrobras Gás S.A. – Gaspetro), Sulgás, Necta, Compagas, Moove, Rumo, and Radar, through which we control real estate companies, among others.
Raízen, a joint venture between us and Shell created in June of 2011, produces more than three billion liters of ethanol per year to supply both domestic and international markets and 5.8 million tons of sugar, with 1.6 GW of installed capacity—making it one of the largest sugar exporters and one of the world’s largest power generators of electricity from sugarcane bagasse. The company plants, harvests and processes sugarcane, the main raw material used in the production of sugar and ethanol. Raízen also distributes fuel to over 7,692 service stations throughout Brazil, Argentina and Paraguay under the Shell brand, with more than 2,000 Shell Select convenience stores, 70 distribution terminals and presence in 68 airports supplying jet fuel.
Compass was created in March 2020 to expand and diversify the gas market in Brazil, promoting greater security and competitiveness to the country’s energy matrix. Compass has invested more than R$9.0 billion in the Brazilian natural gas market, with operations currently grouped into two segments: (i) distribution and (ii) marketing and services. The distribution segment operates through two vehicles that hold stakes in Comgás, Brazil’s largest natural gas distributor, and in six other gas distributors managed by Commit, a subsidiary of Compass. Commit’s assets are organized with a focus on the Central-South regions of Brazil, where it owns 49% of Sulgás, 24.5% of Companhia Paranaense de Gás – Compagas, or “Compagas,” and 100.0% of Necta, which is directly controlled by Commit. In addition to its indirect interest through Commit, Compass also has an indirect interest in Sulgás through its wholly-owned subsidiary, Compass Um Participações S.A., giving Compass control of Sulgás, and has an indirect interest in Compagas through its wholly-owned subsidiary, Compass Dois Ltda, giving Compass control of Compagas.
The marketing and services segment, operated through our subsidiary Edge Comercialização S.A., offers alternative natural gas supply options to consumers while promoting decarbonization for all its customers, whether connected to the distribution network or off-grid, displacing other energy sources through road transportation. This business model relies on strategic assets such as the TRSP (São Paulo Regasification Terminal located in Santos), biomethane assets and contracts, LNG B2B (liquefied natural gas), other infrastructure projects, and gas trading.
Through Moove, we produce and distribute automotive and industrial lubricants. Under the Mobil brand, Cosan S.A. operates in Brazil and in nine other countries: in South America, Argentina, Bolivia, Uruguay and Paraguay; in North America, the United States of America; and in Europe, Spain, France, Portugal and the United Kingdom. These operations are aligned with Moove’s strategy of leveraging the ExxonMobil strategic partnership and expanding its operations globally. In addition, Moove operates through a range of proprietary brands, which include the “Tirreno” brand in Brazil and the “Comma” brand in the United Kingdom (through which it also sells its products to over 40 other countries in Europe and Asia). Following our acquisition of PetroChoice in May 2022, Moove also operates throughout the United States under the main brands “EcoUltra, Medallion Plus and Dyna-Plex 21C.”
Rumo is Latin America’s largest logistics operator, with an independent railway base, and offering a broad range of rail transportation logistics services, port loading and storage. The five railway concessions Rumo operates are in the States of Mato Grosso, Mato Grosso do Sul, São Paulo, Tocantins, Goiás and the States of Brazil’s south region (Paraná, Santa Catarina, and Rio Grande do Sul). Rumo is a leader in the transport of sugar for exportation and is creating an integrated transport platform that will significantly increase the efficiency of Brazilian exports. In addition, following Rumo’s merger with ALL, Rumo has become one of the most important transportation and port operators for grains and other commodities in Brazil. For additional information, see “—A. History and Development of the Company.”
Our real estate operations are conducted through Radar, Radar II, Tellus, Janus, Gamiovapar and Duguetiapar. These companies focus on acquiring rural properties to be subsequently leased or sold to third parties. Radar is a land management company that invests in assets with high productivity potential in Brazil. It owns and manages approximately 416 rural properties covering a total of 90,128 hectares, and harvests sugarcane, soy, cotton, corn and other commodities in the States of São Paulo, Maranhão and Mato Grosso. Radar manages its properties using a satellite-based geomonitoring system and we believe it is well positioned to create carbon credits. Cosan acquired additional stakes in Tellus, Janus, Gamiovapar and Duguetiapar in September 2022. Tellus, Janus, Gamiovapar and Duguetiapar are also land management companies that invest in agricultural land in Brazil and oversee approximately 408 rural properties, covering a total of 206,223 hectares (142,452 hectares of which are considered useful), dedicated to the harvesting of sugarcane, soy, cotton, corn and other commodities in several States of Brazil.
Cosan S.A. (B3 ticker: “CSAN3”) has been listed since 2005 on the B3 segment with the highest standards of corporate governance, the “Novo Mercado.” Raízen’s preferred shares with no voting rights (B3 ticker: “RAIZ4”) have been listed on the B3 since August 2021 on the “Nível 2” segment. Comgás (B3 ticker: “CGAS3” and “CGAS5”) has been listed since 1997 on the B3. Rumo (B3 ticker: “RAIL3”) has been listed since 2015 on the B3, and also on the “Novo Mercado” segment. Our ADSs have also been listed on the NYSE under the symbol “CSAN” since March 2021, as a consequence of the Merger.
Raízen
Raízen primarily operates in the energy sector and other synergistic activities. Raízen has increasingly consolidated itself as an integrated energy company with a diverse portfolio, from renewable sources such as biomass (and expanding to other sources, such as solar), to its core businesses of globally distributing and selling first- and second-generation ethanol (from sugarcane), sugar and other by-products to enterprise, or “B2B,” customers, in Brazil, Argentina and Paraguay, and operating a network of service stations and airport bases.
Raízen’s operations include the production and marketing of ethanol, sugar, gasoline and diesel, and the cogeneration of energy:
Raízen S.A.(1)
Ethanol
23,521.4
25,567.8
23,312.3
Sugar
26,535.7
38,019.1
29,070.5
Gasoline
67,319.6
67,097.8
66,267.7
Diesel
92,715.9
102,834.0
90,281.6
Cogeneration
8,863.6
7,271.2
3,724.1
Other
Total net sales
Ethanol, Biomass and Electricity
Raízen produces and markets renewable energy and by-products of its bioenergy projects and of third parties and seeks to expand its operations into other low-carbon energy sources. Raízen’s activities in the renewables segment encompass:
First-generation ethanol is produced in a chemical process called fermentation by which sugarcane used in ethanol production is processed in the same way as for sugar production and resulting molasses get mixed with sugarcane juice and yeast in tanks. The by-product of the fermentation process is then boiled and distilled and/or dehydrated to produce the various types of ethanol. Raízen also produces second-generation ethanol, or “E2G,” which emits 80% less carbon dioxide than fossil fuels. E2G is a cellulosic biofuel made according to our proprietary technology. The process of making E2G consists of hydrolysis and fermentation of bagasse and straw with enzymes and yeasts. Raízen is a pioneer in developing carbon circularity from the by-products of its production processes. Raízen introduced biogas technology in its bioenergy parks, which is produced through a bio digestion process from vinasse and filter cake and can be a substitute for methane in its various applications, including in the production of electricity. Raízen also produces other products derived from sugarcane biomass such as the steam from excess bagasse in boilers, which can be used to move mechanical parts in bioenergy parks as well as to generate electricity sold to the grid.
Raízen is able to transport ethanol and sugar production from its extensive infrastructure of port terminals and bioenergy parks in the Central-South region of Brazil. Raízen also has terminals connected to the most efficient modes of transportation and strategic positioning in the main ports to export production, in addition to having its own teams to market production both in Brazil and overseas. The logistics of delivering products to customers depend on the complexity and the potential to capture value by advancing development into the supply chain.
In addition to sugar and ethanol, Raízen also sells any excess energy produced from processing sugarcane in its bioenergy parks through energy auctions conducted by the government of the State of São Paulo. Furthermore, Raízen began advances into the value chain (production, logistics, marketing and refining) by replicating the same model currently applied to its ethanol business.
Sale and Distribution of Fuel
Raízen produces, distributes and sells fuels and other specialties. Raízen’s primary products include ethanol, gasoline, diesel, vehicular natural gas, kerosene and aviation fuel, lubricants, and oil fuel. In addition, Raízen operates proximity retail stores both within and outside service stations, offering consumer products and services like bakeries, tobacco, groceries, hygiene and cleaning products, food products, and beverages.
The following table presents certain key operating indicators consolidating Brazil, Argentina and Paraguay (except where otherwise indicated), for the periods set forth below.
Service Stations
7,692
8,232
8,204
Fuel sold (million liters)
35,259
34,567
35,295
Gasoline (million liters)
10,847
10,699
11,479
Ethanol (million liters)
3,448
3,925
2,989
Diesel (million liters)
16,827
15,963
16,951
Aviation (million liters)
1,839
1,848
1,873
Other (million liters)
2,298
2,131
2,002
Raízen is the second-largest fuel distribution company in terms of sales volume in Brazil according to the ANP and in Argentina according to the Ministry of Energy and Mines of Argentina (“MINEM”). Its operations consist of the purchase, storage, mixing and distribution of gasoline, ethanol, diesel and aviation kerosene through a network of over 7,692 retail service stations licensed with the Shell brand (over 2,330 of which feature integrated convenience stores) and have recorded consistent year-on-year growth. Raízen’s logistics infrastructure in the segment has been built over more than 100 years, and is strategically located close to major consumer markets. Raízen currently has 70 land distribution terminals, and storage capacity for approximately 1.4 billion liters. In the aviation market, Raízen operates through 68 supply bases in Brazilian and Argentinean airports.
Raízen has a complete platform focused on B2B2C and B2B customers (B2B2C refers to situations in which our products go through an intermediary before reaching the final customer) that support its strategic objective to be the preferred choice for resellers and customers in the markets in which it operates.
Raízen’s capillarity enables it to reach over 50 million consumers in Brazil, who benefit from Raízen’s investments in the development of innovative payment methods and cloud-based platforms such as Shell Box, which is a mobile application that enables customers to enjoy contact-less payment solutions, promotions and other benefits.
Moreover, Raízen’s store models allow it to serve different segments in markets with distinct characteristics, as well as different profiles and purchase needs. This commercial proposal is leveraged by long-term partnerships with the main fast-moving consumer goods companies, generating new forms of monetization and ensuring better competitiveness for our stores, while transforming our network into a strategic channel to launch and position our products. Raízen combines this strategy with promotional and marketing activity in all its stores.
Finally, Raízen has over 5,000 customers in the B2B market in Brazil and in Argentina, which are categorized into over different segments (e.g., cargo and passenger transport, agricultural and mining sectors). The B2B strategy is focused on customer loyalty through an offering of premium technology products (such as Shell Evolux, Shell Rimula and Shell Helix portfolios) and carrier fleet control tools. We believe that this strategy, which connects our physical and digital presence, has the potential to create a leading omnichannel platform in the market, in addition to offering financial, procurement, engineering and Health, Safety, Security and Environment, or “HSSE,” solutions for our customers.
Raízen produces and markets a variety of sugars from our bioenergy projects and from third parties, such as raw sugar (or very high polarity sugar, or “VHP”), refined sugar and liquid sugar.
The following table details Raízen’s energy and sugar production.
Crushed sugarcane (million tons)
Volume of sugar sold (thousand tons)(1)
4,796.8
5,973.0
10,173.7
Volume of ethanol sold (million liters)(1)
2,879.4
3,416.2
5,497.5
Energy sold (thousand MWh)(1)
1,690.0
1,961.0
27,208.5
Sugarcane is the main raw material used in Raízen’s bioenergy parks. It is a photosynthetic metabolism plant which has four essential attributes: (i) sugarcane is best suited to convert solar energy into biomass when compared to other crops with which Raízen’s products compete; (ii) sugar is the basis for a diversified product portfolio, which includes sustainable foods, biofuels, bioelectricity and bioproducts or biomaterial. This is consistent with Raízen’s strategy, which includes: Bonsucro, ELO, Raw Materials and Deforestation; (iii) low carbon footprint in Raízen’s products due to circularity and waste optimization; and (iv) high levels of productivity in the Brazilian Central-South region, due to certain natural characteristics of the region (including soil, climate and other factors), combined with access to logistical infrastructure for the outflow of production.
Raízen received the Bonsucro certification for its bioenergy parks and became responsible for a large portion of sugarcane certified under this model globally. In addition to the Bonsucro certification, Raízen has led the creation of an innovative program in the sugar and ethanol industry, the ELO program, which provides a system of continuous improvement and technical assistance to third-party sugarcane suppliers. Generating shared value within our raw material supply chain is an important part of our business. Around 50% of the volume of sugarcane processed by Raízen comes from sugarcane suppliers. Raízen is engaged in the Elos Raízen and Jornada Cultivar programs with the aim of boosting sustainability in the sugarcane production chain by offering technical support and business management advice to its sugarcane suppliers.
As a result of the circular nature of the sugarcane production process, sugarcane-derived products have a low carbon footprint, and can therefore serve as substitutes for fossil and/or products with high environmental impact. For example, consistent with the Bonsucro certification, Raízen’s operations cause no deforestation, and all of its raw materials are subject to sustainability programs.
Raízen’s sugar production encompasses a three-step process: (i) sugarcane is processed for juice extraction; (ii) the product is filtered to remove impurities and boiled to crystallize sugars; and (iii) the product is passed through a centrifuge for the production of the final product, raw sugar or VHP. This can then be refined, dried and packaged in Raízen’s refineries. This process is routinely optimized through Raízen’s proprietary technologies supporting decisions and driving its business.
Regulation
Regulation of the Oil and Gas Industry
Brazil
The ANP is a federal agency responsible for the control, supervision and implementation of the government’s oil, gas and biofuel regulations. The ANP regulates all aspects of the production, distribution and sale of oil, natural gas, and biofuels products in Brazil. With respect to regulation relating to gasoline, diesel and biofuels, the ANP determines: (i) standards and restrictions applicable to the companies which it regulates; (ii) the product quality standards and minimum storage capacities required to be maintained by distributors; (iii) the limits of oil-based fuel volume purchased by distributors based on their storage capacity; and (iv) the criteria applicable to the authorization for the construction, operation and usage of the infrastructure used to handling and storage of fuels.
Environmental health and safety standards. Fuel distributors are subject to Brazilian federal, state and municipal laws and regulations relating to environmental protection, safety and occupational health and safety, licensing by fire departments, environment and transport authorities. The National Environmental Council (Conselho Nacional do Meio Ambiente), or “CONAMA,” is the main government body responsible for issuing environmental standards and regulations at the federal level. Environmental state agencies and municipal departments are also responsible for establishing and supervising complementary laws and regulations within their areas of operation.
Fuel distributors must obtain authorizations and/or licenses from federal, state and/or municipal environmental agencies and fire departments to implement and operate their facilities, and are subject to extensive registration and operational requirements resulting in certain limitations to, among others, the (i) distribution of liquid fuels; (ii) distribution of aviation fuels; (iii) liquid and aviation fuels storage; (iv) liquid products storage and handling; and (v) ethanol production. Furthermore, fuel distributors are required to develop programs to control air, soil and water pollution, including management of hazardous waste.
Port Regulation. The Brazilian port sector is regulated by (i) the National Water Transportation Agency (Agência Nacional de Transportes Aquaviários), or the “ANTAQ,” which is linked to the Brazilian Ministry of Infrastructure (Ministério da Infraestrutura), or the “Ministry of Infrastructure,” (ii) the National Secretariat of Ports (Secretaria Nacional de Portos), or the “SNP,” which is also linked to the Ministry of Infrastructure, and (iii) local port authorities. Since 2012, the Brazilian port sector has undergone a number of regulatory changes, including the enactment of Federal Law No. 12,815/2013, as amended by Law No. 14,047, dated August 24, 2020 (regulated by Decree No. 8,033/2013). One of the most important changes brought about by this new regulatory framework is the abolition of the distinction between “own cargo” and “third-party cargo” for the development and operation of private use terminals, or “TUPs.” Authorizations to operate TUPs are granted by authorizations preceded by public calls (chamadas públicas) or public announcement (anúncio público) and, as applicable, a public bidding procedure.
In addition, the operations of Energía Compañía Argentina de Petróleo S.A., or “Raízen Argentina,” are subject to regulation pursuant to Argentine federal, state and municipal laws and regulations relating to fuel distribution, environmental protection, safety, occupational health and safety, environment and transport matters.
Argentina
The oil and gas industry in Argentina is regulated by Law No. 17,319/1967, as amended by Law No. 26,197/2007 and Law No. 27,007/2014, which sets forth the general legal framework for the exploration, development, industrialization, transportation and marketing of hydrocarbons in Argentina.
Hydrocarbon resources are severable from the general ownership of property. According to the Argentine Constitution, as amended in 1994, natural resources, including hydrocarbon reserves, belong to the provinces in which they are located. However, the Argentine Constitution empowers the Argentine National Congress to legislate on hydrocarbon matters.
Transfer of ownership of hydrocarbon reserves and resources from the federal domain to the provinces was implemented through the enactment of the several legal provisions that effectively amended Law No. 17,319, including by means of Law No. 26,197. The reserves and resources transferred pursuant to Law No. 26,197 were those located in the provinces and in territorial waters up to 12 nautical miles from a baseline, which in Argentina is the mean low-water line along the coast. In addition, with Law No. 26,197 the enforcement of the exploration permits, and production and transportation concessions granted by the Argentine federal government over the hydrocarbon reserves and resources prior to the law was transferred to the provinces.
The Secretariat of Energy of the Ministry of Economy (Ministerio de Economia), or “SE,” is the federal enforcement agency responsible for the control, supervision and implementation of the Argentine government’s oil, gas, and biofuel regulations. The SE regulates all aspects of the production, distribution and sale of oil, natural gas, and biofuels products in Argentina. With respect to regulation relating to gasoline, diesel oil and biofuels, the SE determines the product quality standards and storage requirements (SE Resolution No. 1,283/2006).
Hydrocarbon-refining activities are subject to Law No. 13,660/1949, which provides the basic regulatory framework for these activities, whether conducted by oil producers or third parties, and to registration requirements established by the SE (SE Resolution No. 419/1998). In addition to federal rules, refining activities must comply with provincial and municipal regulations on technical and safety standards. Decree No. 1,212/1989 established a Refineries and Gas Station Price Deregulation Policy. Moreover, the locations where liquid fuels are sold are subject to registration requirements established by Resolution No. 1102/2004, enacted by the SE.
The export of crude oil, natural gas and their derivatives is subject to prior governmental approval. The import of crude oil and liquid fuels also requires prior governmental approval. Law No. 26,050 establishes the legal framework for the industrialization and commercialization of liquid petroleum gas.
Port Regulation. The Argentinean port sector is regulated by Law No. 24,093 and Decree No. 769/1993. This legal framework regulates all matters related to the authorization, administration; and operation of existing and to-be-created state-owned and private ports in Argentina. The regulation classifies ports according to their ownership into national, provincial, municipal; and privately owned, and according to their purpose into commercial, industrial; and recreational. It also contains the conditions and requirements for authorizing ports. The Argentine ports regulation also provides that private individuals may build, administer; and operate public or private ports for commercial, industrial or recreational purposes, on public land or on their own property, and requires that the fees, prices and other consideration paid by users be strictly proportional to the service provided.
Environmental Health and Safety standards. Provinces have the power to legislate as to and regulate environmental matters. Provincial environmental regulations must set standards equal to or higher than those approved by the Argentine National Congress. Most of the hydrocarbon-producing provinces have issued specific environmental regulations for the oil industry, including on unconventional operations.
Legislation Applicable to Fuel Distributors. Fuel distributors are subject to Argentine federal, state and municipal laws and regulations relating to environmental protection, safety and occupational health and safety, environment and transport authorities. The Argentine Ministry of Environmental and Sustainable Development (Ministerio de Ambiente y Desarrollo Sostenible) is the government agency primarily responsible for issuing environmental standards and regulations at the federal level. Law No. 25,675 sets out minimum standards for the adequate and sustainable management of the environment, the preservation and protection of biodiversity and the implementation of sustainable development. Fuel distributors must obtain authorizations and/or licenses from federal, state and/or municipal environmental agencies to operate their facilities. They are required to develop programs to control air, soil and water pollution, including to manage hazardous waste in accordance with Law No. 24,051, which contains the regulatory framework on the generation, handling, transportation; and treatment of hazardous waste.
Regulation of Sugar, Ethanol and Cogeneration Activities
Raízen is subject to several Brazilian federal, state and municipal environmental protection and health and safety laws and regulations governing, among other things, the generation, storage, handling, use, transportation and discharge of hazardous materials into the ground, air and water as well as regulation concerning electricity generation. Below is a summary of the principal rules and regulations to which Raízen is subject in this regard.
Permits
Certain environmental laws require us to obtain from governmental authorities permits, licenses and authorizations to install and operate our mills, to burn sugarcane and to perform other activities.
We are subject to the regulations of the pollution control and remediation agencies of several Brazilian states, such as:
Environmental Licensing of Raízen
We operate mills, transport facilities and numerous warehouses. CONAMA is the government agency responsible for issuing rules and resolutions on environmental licensing at a national level. Environmental licensing is required for the development of new facilities and for alterations in existing operations. Environmental licenses must be periodically renewed.
Sugarcane Burning
The State of São Paulo and certain municipal governments have established laws and regulations that limit or eliminate the burning of sugarcane entirely. We have voluntarily signed the Agro-Environmental Sugarcane Protocol, which establishes accelerated deadlines for the reduction of sugarcane burning.
Brazilian Forestry Code
We are subject to Brazilian Federal Law No. 12,651, dated May 25, 2012, or the “Brazilian Forest Code,” which prohibits land use in certain permanently protected areas, and obligates us to maintain and register a forest reserve in each of our rural landholdings covering from 20% to 80% of the total area of such land, known as “Legal Reserve.”
Environmental Liabilities
We are involved in certain administrative and judicial proceedings for alleged failure to comply with environmental laws and regulations (especially relating to environmental damages caused by sugarcane burning and contaminated areas). The Brazilian Federal Constitution provides for three different types of environmental liabilities: (1) civil, (2) administrative and (3) criminal. Noncompliance with environmental law is subject to administrative, civil and/or criminal sanctions, regardless of the civil impacts such as the obligation to repair, compensate or indemnify any damages caused to the environment or third parties. Public attorneys’ offices, foundations, state agencies, state-owned companies and environmental protection associations are all authorized by law to file public civil actions seeking compensation for environmental damages.
Sugar Regulation
The MAPA is responsible for planning, coordinating, monitoring and assessing the implementation of governmental initiatives and programs related to the production of sugarcane and ethanol. All sugarcane processing mills must be duly registered with SAPCana (Sistema de Acompanhamento de Produção Canavieira), a system created and maintained by the MAPA that registers all sugar and ethanol producing mills and ethanol trading companies and monitors the production of sugarcane, sugar and ethanol in Brazil. All registered mills must regularly submit (online) reports about the production, output and inventory of sugar and ethanol, in accordance with Normative Instruction No. 52, of November 12, 2009 (the regulation that created SAPCana). Noncompliance with the rules established under the aforementioned Normative Instruction may subject us to suspension or cancellation of the registration in SAPCana until irregularities are resolved.
Ethanol Regulation
The Brazilian ethanol industry is also regulated by the ANP, a federal agency linked to the Ministry of Mines and Energy (Ministério de Minas e Energia), or the “MME.” On April 29, 2011, a provisional measure was published in Brazil’s Official Gazette, or the Provisional Measure No. 532/11, that changed the status of ethanol from an agricultural product to a fuel. Previously, the ANP was only responsible for the oversight of the distribution and sale of ethanol. Since the publication of Provisional Measure No. 532/11, converted into law on September 16, 2011 as Law No. 12,490/11, the agency then became responsible for the supervision of mills producing sugarcane-based biofuel. In accordance with Law No. 12,490/12, and to regulate the ethanol industry, the ANP published Resolution No. 734 of June 28, 2018, pursuant to which the production of ethanol, which involves construction, capacity expansion, modification and operation of ethanol production plants, became subjected to prior authorization of the ANP.
The performance of an activity without the proper authorization or with an expired authorization issued by the ANP may subject us to the following penalties, among others: (1) fine (from R$5,000 and R$5 million); (2) prohibition on performing such activity while the company is not in conformance; (3) temporary suspension of all or part of the site or operation of the facility; (4) inability to operate in the same activity in the future; or (5) annulment of our registration, pursuant to Law No. 9,847/99, of October 26, 1999. These penalties may be applied cumulatively and tend to be more severe depending on the economic capacity of the party and recidivism.
Electricity Regulation
The Brazilian power industry is regulated by ANEEL, a federal regulatory agency, in accordance with the general guidelines set forth by the Ministry of Mines and Energy. To perform power generation activities, the power agent must obtain authorizations granted by ANEEL or execute concession and permission agreements with the Brazilian government through ANEEL, which can be terminated before their original term upon the occurrence of certain events. The activities related to generation and commercialization of electricity performed by Raízen are subject to ANEEL’s supervision. Pursuant to Law No. 9,427 dated December 26, 1996 and ANEEL’s Resolution No. 846/2016, within the scope of its powers of inspection of electrical energy plants and services, ANEEL may impose penalties (including warnings, fines, temporary suspension of the right to participate in bidding processes for new concessions, licenses or authorizations, or request for new grants, licenses or authorizations, and revocation of existing authorizations or concessions granted by ANEEL) on power industry participants based on the nature of its relation with the agency (concessionaires or agents who hold permission or authorization) and the materiality of the infraction. In case of fines, the limit of 2.0% of the revenue of the concessionaire in the 12-month period preceding any assessment notice must be respected or, for independent producers or self-producers (authorized agents), 2.0% of the estimated amount of energy produced in the same period. In addition, pursuant to ANEEL’s Resolution No. 846/2019 some infractions may result in fines related to the failure of the agent in requesting ANEEL’s prior approval to certain conduct, including the following:
Furthermore, if a power generator’s fuel suppliers are either unable or unavailable to comply with their respective contractual obligations, in whole or in part, the power generator may face (1) a default of its regulatory duties, (2) a temporary reduction of its allotted energy generation capacity, and (3) difficulties in maintaining assets or projects. Finally, if power generators lack fuel, they may be subject to fines under ANEEL Resolution No. 583/2013, as applicable.
Raízen and its subsidiaries also operate in the distributed energy generation segment, wherein projects enjoy the benefits of ANEEL Normative Resolution No. 482/2012, or “Resolution 482” – in particular, an exemption from charges on the transmission and distribution of electricity. The Brazilian National Congress recently instituted a new legal framework for the micro and small-size distributed generation sector in Brazil. As a result of the enactment of Law No. 14,300, both ANEEL and electricity distributors must adapt their rules, regulations, procedures and processes to the new guidelines within 180 days after its publication.
Pursuant to Law No. 10,848, dated March 15, 2004, the purchase and sale of electricity operations are carried out in two different market segments: (i) the regulated contracting environment, which houses the purchase by distributors, through auctions, of all the electricity that is necessary to supply its consumers, and (ii) the free contracting environment, which houses the purchase of electricity from other CCEE agents (such as electricity generators and traders). Energy sector agents are also subject to the payment of sector charges and fees for the use of the transmission or distribution system, as applicable.
Controlled Substances
Certain laws and regulations require us to obtain from governmental authorities permits, licenses and certificates to use controlled substances in our activities. Decree No. 10,030, dated September 30, 2019, regulates the Brazilian Army’s control over explosive substances and establishes that those who manufacture, store or sell such substances are required to obtain a registration certificate, which must be periodically renewed. Law No. 10,357, dated December 27, 2001, sets forth that those who manufacture, store, handle, use and distribute chemical substances, which could be employed in the manufacture of narcotics or psychotropic substances, are subject to control by the Federal Police Department and shall obtain the required certificates, which must be periodically renewed. In parallel, state legislation empowers each state’s respective Civil Police to grant licenses for use, storage, marketing, importation and exportation of certain chemical products, usually consisting of an inspection certificate and an operating license. Sanctions that can be imposed in cases of noncompliance with the applicable regulations concerning controlled substances include notices, fines, pre-interdiction fines, interdiction, apprehension of products, suspension, and cancellation or forfeiture of the corresponding certificates and licenses.
Sanitation Regulation
The food industry is subject to the rules set forth in Decree No. 986, dated October 21, 1969, and is regulated by the National Agency of Health Surveillance (Agência Nacional de Vigilância Sanitária), or the “ANVISA,” an independent federal regulatory agency, in accordance with the general guidelines set forth by the Ministry of Health, and by the MAPA. The requirements for classification, identity, quality and labeling applicable to sugars for human consumption are established by the MAPA Normative Instruction No. 45, dated August 30, 2018, and the ANVISA Resolution No. 271, dated September 22, 2005. Activities related to the production and selling of standard sugars for human consumption are subject to local sanitary authorities’ licensing. Law No. 6,437 dated August 20, 1977, as amended, governs the imposition of sanctions for players in the food sector, which include notices, fines up to R$1,500,000 (which may be doubled in cases of repeated penalties), production and/or sales prohibition, facilities interdiction, revocation of the facilities’ sanitary permit, and seizure and/or destruction of products.
Compass
Overview
On January 14, 2020, we contributed to the share capital of our wholly owned subsidiary Compass, formerly known as Distribuidora de Gás Participações S.A., the totality of the shares we held in Comgás (i.e., 103,699,333 common shares and 27,682,044 preferred shares), equivalent to 99.15% of the total share capital of Comgás, for an amount of R$2,861.9 million. As the parties to the transaction are under common control transaction, there was no effect on our consolidated financial statements. We derecognized the investment in Comgás and we recognized an investment in Compass for the same amount.
On March 9, 2020, we announced the creation of our new gas and power business segment of which Compass is the holding company and through which we now conduct our activities in the gas and power market. On January 3, 2022, Compass’ subsidiary Compass Um Participações S.A. concluded the acquisition of 51% of the capital stock of Sulgás, assuming the control of Rio Grande do Sul’s gas supply concessionaire.
In addition, on July 11, 2022 Compass concluded the acquisition of 51% of Commit, a holding company that holds interests in 11 gas supply concessionaires in 11 states of Brazil. This acquisition from Petróleo Brasileiro S.A., or “Petrobras” was agreed to after a competitive process led by Petrobras to divest Petrobras Gás S.A., or “Gaspetro” (now known as Commit). Before the acquisition, Commit held interests in 18 gas supply concessionaires, but this number was reduced by seven due to the exercise by other shareholders of preemptive rights that were triggered upon the change of control of Commit.
On September 16, 2024, Compass concluded the acquisition of 51% of the share capital and control of Compagas for R$962.1 million. On November 6, 2024, Compass concluded the sale of its 51% stake in Norgás S.A., or Norgás, to Infra Gás e Energia S.A. Norgás has a 29.4% equity interest in Companhia de Gás do Ceará – Cegás, an 83% equity interest in Companhia Potiguar de Gás – Potigás, a 29.4% equity interest in Gás de Alagoas S.A. –Algás, a 41.5% equity interest in Sergipe Gás S.A. – Sergás and a 41.5% equity interest in Companhia Pernambucana de Gás - Copergás. The purchase price for the sale was paid in full on November 6, 2024.
Compass’ subsidiary, Comgás, is Brazil’s largest distributor of piped natural gas, with a network reaching 23,898 thousand kilometers and delivering natural gas to more than two million residential, commercial and industrial consumers in about 177 cities, including 96 municipalities in the metropolitan areas of São Paulo, Campinas and Santos as well as the Paraíba Valley. Sulgás, Compagas and Necta have a distribution network of approximately 4,033 km, serving over 234.2 thousand customers, and in 2025 distributed a volume of 3.79 million cbm/day.
We believe the prospects for future availability of natural gas in Brazil are positive based on expected exploration of carbon deposits discovered in the pre-salt layer offshore of Brazil’s coast. Comgás’ supply of natural gas is currently sourced primarily from Petrobras, with contracts in Bolivia and Brazil having been entered into. Comgas’ natural gas supply agreement with Petrobras was renewed in January 2024 until December 2034. Our subsidiary Edge Comercialização S.A. also has a contract with Comgás for a duration of 10 years, until June 2033. See “Item 3. Key Information—D. Risk Factors—Risks Related to Our Business, the Operations of Our Joint Venture, and Industries in Which We Operate—Our business would be materially adversely affected if operations experienced significant interruptions. Our business would also be materially adversely affected if the operations of our customers and suppliers experienced significant interruptions.”
Compass Highlights
Natural gas sold (million cbm)
5,103.7
Net sales (R$ millions)
16,604.1
18,383.4
17,767.3
The ANP is responsible for the control, supervision and implementation of the government’s oil, gas and biofuel policies. The ANP is responsible for regulating all exploration, production and importation activities with respect to the gas sector, as well as for regulating the gas transport sector.
In addition to the regulation by ANP, Compass’ activities are also supervised and regulated by ARSESP and ARGERGS, with which it maintains continuous dialogue through its directorate for Regulatory and Institutional Affairs to enhance or formulate industry policies. The functions and responsibilities of these agencies include, among others: (i) setting, adjusting, reviewing and approving both the distribution contracts and the tariffs applicable to the contracts; (ii) holding public consultations and hearings to issue new and review old rules related to the activity of gas distribution; and (iii) conducting inspection activities, as well as applying sanctions to agents that violate the rules and guidelines issued by the agencies.
Concessions and Authorizations
Pursuant to the Brazilian Federal Constitution of 1988, it is the responsibility of the State to provide, directly or through concessions, piped gas services. Concessions are formalized through concession agreements. Our subsidiaries Comgás and Necta are the concessionaires for the public distribution of natural gas for part of the State of São Paulo pursuant to Decree No. 43,888, of March 10, 1999, or Decree No. 43,888/99, and concession agreement No. CSPE/01/99, entered into on May 31, 1999 with the State of São Paulo (as amended), which at the time was represented by the Public Energy Services Commission of the State of São Paulo, and has since been replaced by the ARSESP.
In the case of the State of Rio Grande do Sul, our subsidiary Sulgás is the concessionaire for the public service of natural gas distribution. The company was established by State Law No. 9,128, of August 7, 1990, and is authorized to operate as the state’s distributor for a term of 50 years, pursuant to a concession agreement entered into on April 19, 1994.
São Paulo Concession
The Comgás concession agreement was originally set for a 30-year term, which was renewed for an additional 20 years at the discretion of the government of the State of São Paulo considering that Comgás is in compliance with all of its tax, social security and other legal and regulatory commitments and obligations. In September 2019, Comgás submitted an extension request for the concession to the SIMA, as provided for in the concession agreement. On October 1, 2021, the Seventh Amendment to the Concession Agreement No. CSPE/01/99 was signed, extending the concession agreement until May 30, 2049.
Pursuant to the concession agreement, Comgás has the right to distribute and commercialize piped gas to customers until 2049 and in a concession area comprising 177 cities in the State of São Paulo. Comgás is also authorized to carry out other business activities, provided that (i) it obtains prior authorization from the ARSESP; (ii) such activities do not interfere with Comgás’ main activity; and (iii) the revenues from such activities are accounted for separately. In addition, any change in the bylaws of Comgás resulting in a transfer of shares or a change of control requires the prior approval of the ARSESP.
The concession agreement sets out Comgás’ obligations, including, with respect to quality and safety, the five‑year tariff review procedures. CSPE Ordinance No. 160/01 established the general conditions for the supply of piped gas and was replaced by the ARSESP Resolution No. 732 in August 2017. The concession agreement provides for three types of tariff review/adjustments, namely (i) the five-year cycle tariff review; (ii) the annual adjustment as of December 10 of each year of the average margin using the IPCA/IBGE; and (iii) extraordinary revisions to the extent there are significant cost variations, to reestablish the economic and financial balance of the concession. Also, under the terms of the concession agreement, Comgás must achieve certain minimum targets for the sale of gas and the implementation of mechanisms for improving the piped gas distribution system, under the evaluation of ARSESP.
On December 6, 2019, ARSESP published Resolution No. 933, which approved the amount of R$697.2 million plus monetary adjustment since April 2018, as a result of the Third Ordinary Tariff Review, to be applied to the value of the assets returned by Comgás upon termination of the concession, or to any amounts payable by Comgás if the concession is renewed, or to any amounts payable in connection with any renewal of the concession agreement, as it comes to be defined by ARSESP, according to Resolution No. 995 of May 27, 2020. With the publication of the aforementioned resolution, there are no more ongoing discussions regarding tariffs related to previous periods with ARSESP. The amount indicated in Resolution No. 933 was not recognized in our financial statements because it does not comply with accounting standards.
To the extent Comgás fails to comply with its obligations under the concession agreement, it will be subject to penalties of up to 2% of its annual revenues, and the granting authority may terminate the concession or take control of the concession to ensure the adequate provision of the piped gas distribution services.
The concession agreements may be terminated as a consequence of: (i) expiration of the contractual term; (ii) expropriation of the concessions in the public interest (i.e., encampação); (iii) forfeiture (caducidade); (iv) termination; (v) annulment of the concession agreement to the extent irregularities in the bidding process or the granting of the concession are identified; or (vi) the bankruptcy or expiration of Comgás.
Authorizations to carry out public works in the concession area are obtained from the relevant municipality.
On November 10, 1999, Necta entered into Concession Contract Nº CSPE/02/99 with the public energy services commission (Comissão de Serviços Públicos de Energia or “CSPE”) of the State of São Paulo to provide piped gas distribution services in 375 municipalities for a term of 30 years, extendable for an additional 20-year term.
Furthermore, under the terms of ARSESP Deliberation No. 1,061/2020, the concession to Compass and Necta would be subject to the piped gas free market regime. Accordingly, pursuant to the ARSESP terms, such gas suppliers would be entitled: (i) to freely contract the purchase of piped gas from supplying agents and free users or partially free users; and (ii) to negotiate prices and other commercial conditions for piped gas in any location in the State.
Rio Grande do Sul Concession
Our subsidiary Sulgás is the concessionaire for the public distribution of natural gas in the State of Rio Grande do Sul pursuant to a concession agreement signed on April 19, 1994. The concession agreement is for a 50-year term.
On April 19, 1994, Sulgás signed a concession contract with the State of Rio Grande do Sul for the exclusive rights to provide piped gas distribution services to any and all consumers or industry, commerce, institutions and residences, for any and all uses or purposes in Rio Grande do Sul for a period of 50 years.
Under the terms of the concession agreement, Sulgás will be obligated to ensure (i) the provision of adequate services, as provided in the agreement and applicable technical standards; (ii) the maintenance of the inventory and registration of assets related to the concession; (iii) the collection of tariffs as established in the agreement; (iv) the use of the public domain necessary for the execution of the service, as well as to promote expropriation and create easements of areas declared of public utility for the provision of services; (v) rendering of accounts of the management of the service to the state government and its users; (vi) care for the integrity of the assets linked to the rendering of the services; (vi) permission to inspect, at any time, the works and installations included in the concession, as well as the respective accounting records; and (vii) the maintenance, on a permanent basis, of a user service agency with the specific purpose of attending to complaints and claims regarding the rendering of services, as well as to forward suggestions aimed at its improvement.
The concession agreement will be terminated upon the occurrence of one of the following events: (i) expiration of the 50-year term; (ii) removal from service (i.e., taken over due to public interest); (iii) forfeiture; (iv) rescission; (v) annulment; or (vi) extinction of the concessionaire. The contract can also be terminated at Sulgás’ discretion in the event of noncompliance by the state government with certain contractual provisions of the concession agreement.
In the event that Sulgás does not comply with the provisions of the concession agreement, it will be subject to intervention by the State of Rio Grande do Sul, as well as having to bear the costs of the administrative process and the subsequent rendering of accounts before the state.
In accordance with Brazilian state law 15,648/21, which has not yet been regulated by AGERGS, free agents (i.e., auto-producers, auto-importers and free consumers) may purchase natural gas other than through the piped gas service concessionaire. In this case, the concessionaire must (i) provide the necessary infrastructure for meeting the gas handling needs in its concession area, including the needs of the free agents; or (ii) if the free agents cannot have their natural gas handling needs met by Sulgás, they may directly build and implement a gas distribution infrastructure for their use, which must be operated and maintained by Sulgás by signing a Distribution System Use Agreement (Contrato de Uso do Sistema de Distribuição, or “CUSD”) as well as the payment of a Distribution System Use Tariff (Tarifa de Uso do Sistema de Distribuição, or “TUSD”).
Currently, there are several discussions involving Sulgás at AGERGS: (i) Public Consultation and Public Hearing No. 02/2023, which addresses Sulgás’ tariff revision for 2023; (ii) Normative Resolution No. 67/2023, whose intention is to approve the Regulation for Distribution Services of Piped Gas for the State of Rio Grande do Sul; and (iii) Normative Resolution No. 68/2023, with the objective of establishing the legal framework for the free market of piped gas in the state. The results of these discussions could directly and permanently affect Sulgás’ operations.
Paraná Concession
Our subsidiary Compagas is the concessionaire of the state-owned piped natural gas distribution service in the State of Paraná. On December 20, 1996, Compagas signed a concession agreement with the State of Paraná granting it an exclusive right to operate the piped natural gas distribution network throughout the state for all consumer market segments for a period of 30 years, starting from July 6, 1994. On December 26, 2022, Compagas’ concession was extended for a further 30 years to July 6, 2054.
Under the terms of the concession agreement, Compagas is required to provide adequate levels of services, in accordance with the concession agreement, applicable law and regulatory standards. The concession agreement provides that the concession may be terminated in the following circumstances: (i) expiration of the contractual term; (ii) expropriation; (iii) forfeiture; (iv) termination; (v) annulment; and (vi) bankruptcy or extinction of the concessionaire. Compagas may also take legal action to terminate the concession agreement if the granting authority fails to comply with its terms.
The general conditions for providing piped natural gas distribution services are regulated by State Decree No. 6,052/2006, which is due to be superseded by new regulations to be issued by AGEPAR.
The following AGEPAR resolutions are currently in effect:
The concession agreement stipulates that tariff adjustments will occur through revisions and adjustments, namely: (i) periodic tariff reviews every five years; (ii) extraordinary tariff review aimed at restoring economic and financial balance, which can occur at any time due to unforeseen and unpredictable events affecting one of the parties, as outlined in the concession agreement, (iii) following adjustments to the weighted average cost of gas, in accordance with AGEPAR Resolution No. 28/2022; and (iv) annual adjustments in certain circumstances outlined in the concession agreement, except during years in which periodic tariff reviews take place.
The Gas Law
The natural gas industry is regulated by Law No. 14,134, of April 8, 2021, as amended, or the New Gas Law. This New Gas Law revoked the Law No. 11,909, of March 4, 2009, and has set a new regulatory framework for the exploration of the economic activities in the natural gas market. The New Gas Law seeks to attract private investment and promote a more open and dynamic market, which is intended to reduce energy costs, stimulating economic growth, establish a more transparent and predictable regulatory framework, simplify the licensing process and allow third-party access to gas transportation and distribution infrastructure. These measures are expected to increase competition among gas companies, reduce dependency on Petrobras, and stimulate the development of new gas fields and infrastructure. In addition, Decree 10,712, of June 2, 2021, regulated Law No. 14,134, which sets forth the new guidelines on natural gas transportation in Brazil.
Moove
Moove is responsible for the manufacturing and distribution of passenger vehicle lubricants, commercial vehicle lubricants, industrial lubricants and special application products such as greases, cutting oils and car care products under the Mobil brand, operates in Brazil and in nine other countries: Argentina, Bolivia, Uruguay, Paraguay, the United States of America, Spain, France, Portugal and the United Kingdom. This is consistent with Moove’s strategy of leveraging the ExxonMobil partnership and expanding abroad. Under the “Comma” brand, Moove also operates in the United Kingdom, selling its products to over 40 other countries in Europe and Asia.
Moove Highlights:
Volume of lubricants sold (million liters)
9,320.1
10,248.2
10,078.6
Moove operates nine manufacturing plants across Brazil, the United Kingdom, and the United States of America and more than 100 warehouses across the regions in which it operates. In Brazil there are five plants, one in the city of Rio de Janeiro, State of Rio de Janeiro, where the largest plant of the business, with its own pier, is located. Another unit is located in the city of Diadema, State of São Paulo, where products under the Tirreno brand are manufactured. Additionally, Moove operates three other plants in the State of São Paulo dedicated to the production of lubricants, greases and packaging. Outside Brazil, Moove has a plant in Gravesend, England, where it produces and distributes lubricants, as well as other automotive products, such as antifreeze, additives and coolants, destined for the UK markets and exported to some European and Asian countries, mainly under the Comma brand. Moove also has two other plants in the United States in the cities of Wichita, Kansas, and another one in Indianapolis, Indiana, where lubricants and other automotive products are produced under the Dynaplex, Ecoultra and Medallion Plus brands. Through these plants, Moove produces and markets a comprehensive portfolio of lubricant products and specialties for various sectors, from automotive to industrial.
We have distribution and production rights for Mobil brand products in Brazil and distribution rights in Bolivia, Paraguay and Uruguay following the purchase of ExxonMobil’s lubricant distribution business in these latter three countries in 2011.
In July 2012, we acquired Moove Lubricants, which reinforced our strategy to enter into the European lubricants and specialties markets. As a result, we acquired finished lubricants and the manufacture and sale of chemicals to third parties, all of Moove Lubricants’ assets at the Gravesend site in Kent, United Kingdom, as well as ownership of Moove Lubricants’ trademarks and brand names. In addition, there are agreements in place allowing Moove Lubricants to distribute select Mobil-brand lubricants into specific sales channels in the United Kingdom and to continue to manufacture and distribute a range of seasonal and ancillary automotive products to ExxonMobil and other Mobil distributors in Europe and Asia.
Since December 2016, Moove has had distribution rights for Mobil brand products in Spain and, more recently, in the United Kingdom, France, Portugal and the United States of America. Since December 2018, Moove has had distribution rights for Mobil-branded products in Argentina.
In May 2022, Moove expanded its international portfolio by acquiring PetroChoice, a lubricants distributor and marketer for Mobil brand products and proprietary brands in the United States that distributes about 240 million liters of lubricants annually, and its assets, which include two lubricant blending plants and more than 50 distribution centers across 25 states. Moove also acquired Tirreno, a privately held company headquartered in Brazil, specialized in the production and sale of lubricating oils, additives and fluids. The acquisition of Tirreno is intended to enhance synergies in automotive and industrial products and fluids through technology and manufacturing, distribution, and cross-selling and branding opportunities.
During the third quarter of 2023, the management of Moove approved the execution of a corporate reorganization consisting of the creation of a new entity in the Cayman Islands named Moove Lubricants Holdings, or “MLH,” and the subsequent transfer of all assets from the then-current holding company of the Moove group, Cosan Lubes Investments Limited, or “CLI,” to the new entity.
On January 2, 2025, Moove further expanded its Brazilian portfolio through the acquisition of Pax Group, a lubricants and greases manufacturer that also produces plastic packaging for the lubricants market. Pax Group is composed of three operating companies in addition to its holding company.
On July 1, 2025, Moove also completed the acquisition of Tamco Group, a manufacturer and seller of automotive and industrial lubricants composed of two operating companies in addition to its holding company.
Our lubricants business is not subject to significant seasonality. However, a significant proportion of our raw material purchases are invoiced in U.S. dollars and we hedge part of our shipments of base oils against variations in exchange rates.
Moove is subject to substantially the same regulation imposed by the regulatory bodies to which our fuel distribution business is subject with respect to its operations in Brazil. See “Raízen—Regulation—Regulation of the Oil and Gas Industry—Brazil.”
Moove is also subject to several federal, state and municipal oil and gas, environmental protection and health and safety laws and regulations governing, among other things, the manufacturing and distribution of passenger vehicle lubricants, commercial vehicle lubricants, industrial lubricants and special application products such as greases, ancillaries, base oils and car care products in Brazil, Argentina, Bolivia, Uruguay, Paraguay, the United States of America, Spain, France, Portugal and the United Kingdom.
Rumo
Our logistics operations are conducted through Rumo, which offers an integrated logistics solution to many sectors, but primarily to agricultural commodity producers across Brazil, connecting the main producing regions with Brazil’s four main ports. Rumo also offers warehousing services.
The following table sets forth certain financial and other information of Rumo for the periods indicated:
Transported volume (million RTK)
79,846.0
North operations (R$ millions)
11,111.9
11,096.6
8,346.3
South operations (R$ millions)
1,941.8
2,154.5
2,032.7
Container operations (R$ millions)
Following Rumo’s merger with ALL which was completed on April 1, 2015, Rumo has expanded its offering of logistics services, including, among other things, by providing port handling services. Furthermore, Rumo acquired control of ALL’s former concessions which include the main railroads between the sugar and grain producing areas of the central-south region of Brazil and the ports of Santos, Paranaguá, São Francisco and Rio Grande. As a result, Rumo now operates in the states of Mato Grosso and São Paulo as well as the southern region of Brazil where four of the most active ports in the country are located and through which most of Brazil’s grain production is exported. Moreover, Rumo started operating 9 main inland terminals, either directly or through partners. In September 2021, Rumo announced a contract with the State of Mato Grosso for the construction, operation, exploration, and maintenance of the first state railroad in Brazil. The contract, which has a 45-year concession, renewable for an additional 45 years, will add 740 kilometers of rail in Mato Grosso state, connecting the city of Rondonópolis and the cities of Cuiabá and Lucas do Rio Verde, both in the State of Mato Grosso, to the Port of Santos in the State of São Paulo.
The transportation of agricultural commodities, primarily for export, represented approximately 80%, 85% and 83% of Rumo’s transported volume in the fiscal years ended December 31, 2025, 2024 and 2023, respectively. The transportation of industrial products represented approximately 13%, 13% and 12% of Rumo’s transported volume in the same periods, respectively. Rumo’s transported volume derived from the transportation of grains (soybean, corn and soybean meal) represented 66%, 71% and 70% in the fiscal years ended December 31, 2025, 2024 and 2023, respectively.
Rumo also provides intermodal transportation logistics services, which is the movement of freight via container using two or more modes of transportation (generally rail and truck). We believe that these methods of transportation reduce the costs of cargo handling, because containers are typically consolidated from trucks onto trains or ships that can carry mass loads, allowing for fuel efficiency.
In November 2022, Rumo concluded the sale of 80% of its equity interest in its then wholly owned subsidiary EPSA whose main operation is the storage and handling of grains and sugar (port elevation). Rumo continues to hold a 20% stake in the entity, making up Rumo’s portfolio of port assets.
Operational Segments
Rumo conducts its operations through three operations that correspond to the main markets in which it operates: (1) Northern Operations comprising the Rumo Malha Norte, Rumo Malha Paulista and Rumo Malha Central S.A., or “Rumo Malha Central,” rail concessions, Rumo’s transshipment terminals located in the states of Mato Grosso and São Paulo, and its port operation in Santos, (2) Southern Operations comprising the Rumo Malha Oeste and Rumo Malha Sul rail concessions and Rumo’s transshipment terminals located in the State of Paraná, and (3) Container Operations comprising the operations of Brado Logística which focuses on container logistics, whether by rail or road transport, and the results of container operations on the networks.
The table below shows Rumo’s net sales by operations as well as a percentage of total net sales for the periods indicated:
Northern Operations
80.3%
79.6%
76.3%
Southern Operations
14.0%
15.5%
18.6%
Container Operations
Major Customers
Rumo’s major customers are export companies that participate in the agricultural commodities market, such as Cargill, Bunge, ADM, Amaggi, COFCO, Louis Dreyfus, Raízen, among others. In the periods ended December 31, 2025, 2024 and 2023, Rumo’s six main customers together accounted for 44.1%, 51.1% and 50.2%, respectively, of Rumo’s consolidated net revenue.
Seasonality
Rumo is subject to the seasonality that influences the sugarcane and grain harvest. During the peak months of the harvests, there is higher demand for transport and logistics operations. Rumo is also subject to the risk that sugarcane mills may change their production mix in favor of ethanol if the relative prices of the two products swing that way. This could reduce the demand for sugar logistics and transport. See also “Item 5. Operating and Financial Review and Prospects—Principal Factors Affecting Our Results of Operations—Seasonality.”
Rumo’s activities are subject to extensive regulation by public authorities, especially by the Brazilian Ministry of Infrastructure, the ANTT and ANTAQ.
Further, given the fact that they operate in the transport infrastructure sector, Rumo’s subsidiaries and affiliates maintain a constant relationship with their respective granting authorities, whether in the context of participation in bidding processes to obtain new business (concessions) or in the context of inspections of their existing business by the authorities responsible for supervising services rendered, to remain in compliance with the demands of such authorities.
Rail Transportation Regulation
Rail transportation activities in Brazil are subject to a wide variety of laws and regulations. Rail transportation regulation in Brazil regulates (1) the relationship between the Brazilian government and the rail companies, (2) the relationship among the rail companies, including interchange and mutual transit rights, (3) the relationship between the rail companies and their customers and (4) rail safety. The rules also contain a few provisions relating to a railroad operator’s liability. According to Decree No. 1,832/1996, Rumo will be relieved of liability for damage caused by Rumo’s operations in the event of (1) inherent defects or causes inherent to the nature of the goods to be transported, (2) death or injury of animals as a consequence of the natural risk inherent to rail transportation, (3) lack of latent defect in or fraudulent procedure for the packaging of the product, (4) damage derived from the operations of loading, unloading or trans-loading by the sender, the addressee or their representatives or (5) damage to freight that has been packaged in sealed containers or sealed railroad cars but, after transportation, arrives damaged but still displaying a non-violated seal. Rumo is otherwise liable for losses and damages. The liability is limited to the value declared by the sender, which must be stated on the bill of lading. In the event of fault of both Rumo and the cargo owner, the responsibility is allocated proportionally based on relative fault. Total loss is assumed 30 days after the agreed date of delivery, except when due to force majeure.
Pursuant to Decree No. 2,681/1912, the liability of the rail company for total or partial loss, damage or theft of transported freight is always assumed and the burden of proof of non-liability may only be deemed satisfied if the rail company is able to provide evidence of (1) an act of God or force majeure, (2) a loss caused by fault of the merchandise, (3) death or injury to a live animal resulting from an ordinary risk caused by the transportation, (4) defective packaging of the freight, (5) loss or damage caused by transportation in open cars, as required by regulation or resulting from the agreement with the customer, (6) loss or damage caused by loading and unloading by either the shipper or receiver or (7) loss or damage that could have been avoided by proper surveillance by the shipper of a freighted car. In the cases provided in (1), (2), (3), (5) and (6), whenever there is mutual fault of the rail company and the shipper and/or the receiver, the indemnification shall be apportioned based on relative fault. For a total loss of the merchandise, the amount of the indemnification is limited to the fair market price of the shipped goods. For damage to the merchandise, the indemnification is proportional to the damage caused. In both cases, recovery is reduced by the amount of expenses not incurred by the shipper as a result of the damage or loss. For willful misconduct, all direct damages are indemnifiable. Late deliveries also are indemnifiable under certain circumstances.
Indemnification is limited by a one-year statute of limitations, counted from the delivery date (in case of damage) or from the 31st day after the promised delivery (in case of loss or theft). Any agreement providing for the exemption of railway liability is null and void, except that the indemnification may be limited based on an agreed-upon tariff reduction.
If more than one rail company causes damage, any of them may be named as a sole defendant, although such named defendant will have recourse against the others. Death, disability or personal injuries are also indemnifiable and subject to this presumed liability rule, except when caused by force majeure or the injured party’s sole liability, without fault of the rail company. Indemnification for personal injuries may include, in addition to medical expenses and loss of profits, other indemnification that may be granted. In addition, in 2001, the land transportation industry underwent reform with the enactment of Law No. 10,233/2001, which created, among other agencies, the ANTT, an entity member of the indirect federal administration, submitted to the special administration system and linked to the Brazilian Ministry of Infrastructure, the responsibilities of which include, among others, (1) to publish bidding invitations, judge the bids and execute the rail transportation service concession agreements, (2) to administer concession agreements and rail network leases executed until the date of reform of the transportation market, according to Law No. 10,233/2001, (3) to publish invitations to bid, to judge the bids and to execute concession agreements for the construction and exploitation of new rail networks, (4) to inspect, through cooperation arrangements, compliance with contractual clauses for the provision of rail transportation services, as well as maintenance and replacement of the leased assets, and (5) to regulate and coordinate each concessionaire’s operations.
Rail transportation services in Brazil can be provided by private parties under the concession regime regulated by Law No. 8,987 of February 13, 1995, or the Concession Law. The Concession Law requires that the granting authority and concession holder enter into a concession agreement regulating the terms of such exploration and setting forth the terms applicable to the performance of the services.
Examples of key clauses found in such concession agreements include those relating to its purpose, the concession area and the concession term; the manner, form and conditions for rendering the services; criteria, indicators, formulas and parameters defining the quality of services; the price of the services, criteria and proceedings for the readjustment and review of tariffs; and rights, warrants and obligations of each of the granting authority and the concession holder, including those related to predictable needs of future change and expansion and services and consequent modernization, improvement and expansion of equipment and installations. Further examples include clauses relating to customers’ rights and obligations to have and use the services; contractual and administrative penalties to which the concession holder is subject and their application; concession termination events; revertible assets; criteria for the calculation and the payment conditions of indemnification owned to the concession holder; and conditions relating to the renewal of the concession agreement.
In addition, both the Concession Law and the concession agreements regulate the penalties applicable in case of breach of the concession agreement. Pursuant to the Concession Law, the granting authority is entitled to terminate the concession agreement if (1) the services rendered by the concession holder fall below the standard agreed between the parties with regard to such services; (2) there is a breach of the provisions of the concession agreement by the concession holder; (3) the concession holder interrupts the provision of the services, unless such interruption is due to a force majeure event; (4) the concession holder does not have the financial resources necessary to render the services required under the concession agreement; (5) the concession holder does not comply with penalties imposed by the granting authority; (6) the concession holder does not comply with requests from the granting authority intended to improve the services provided under the concession agreement; or (7) the concession holder does not provide, within 180 days after a request by the granting authority to that effect, documents proving that it is in compliance with applicable tax law. In addition, the granting authority can also terminate the concession agreement when it considers that it is in the public interest to do so, in which case specific legislation must be enacted regarding such termination and the concession holder must be duly indemnified for it.
Waterborne Transportation Regulation
Waterborne transportation services in Brazil are regulated by Law No. 12,815/2013, as amended by Law No. 14,047, dated August 24, 2020, Decree No. 8,033/2013 and by the rules issued by ANTAQ and by the Brazilian Ministry of Infrastructure.
ANTAQ, which was created by Law No. 10,233/2001, is linked to the Brazilian Ministry of Infrastructure. Among other things, ANTAQ is responsible for (1) publishing invitations to bid, executing concession agreements, and issuing authorizations to exploit private port terminals and facilities, (2) inspecting compliance with contractual clauses for the provision of services in connection with public terminals and private port facilities and (3) regulating and coordinating each concession holder’s operations and companies authorized to exploit private port facilities.
In Brazil, there are two main regulatory regimes affecting waterborne transportation: (1) the concession regime, preceded by a public bidding process which regulates the operation of government-owned port terminals and the leasing of government-owned terminals, also preceded by a public bidding process, except when there is only one interested operator, and (2) the authorization regime, relating to new private port terminals and facilities. Furthermore, the Law No. 14,047/2020 has created a temporary use granting of government-owned port terminals for unconsolidated market cargo handling.
Pursuant to Law No. 12,815/2013, with its amendments and additions issued by Law No. 14,047/2020, the following provisions are essential to the lease agreements: contract object, area and term; those relating to the manner, form and conditions for the exploration of organized ports and facilities; the value of the contract, tariffs in place and criteria and procedure for their readjustment and review; those relating to the contracting party’s investment obligations; the parties’ rights, obligations and responsibilities; the duty to provide information of interest and access to port facilities to the competent entities; clauses relating to the port owner’s liability for nonperformance or deficient performance of activities; contract termination events; and penalties and the application thereof; criteria, indicators, formulas and parameters defining the quality of activities performed, as well as goals and time frames for reaching certain service levels; customers’ rights and obligations, including the related obligations of the contracted party and the respective sanctions; assets reversal; contractor and contracting party’s rights, obligations and warrants, including those related to future supplemental need, change and activities expansion and consequent modernization, improvement and expansion of facilities; inspection of facilities, equipment and of the methods and practices for the development of the activities, as well as the appointment of competent entities to perform it; guarantees for the adequate performance of the contract; and clauses on customs inspection measures for goods, vehicles and customers.
Until December 6, 2012, port operations in Brazil were governed by Federal Law No. 8,630/1993, or the Ports Modernization Law, which provided the legal framework applicable to the operation of government-owned port terminals and facilities in Brazil. In view of the need to improve the applicable legislation, the Brazilian government implemented Law No. 12,815/2013, or the Ports Law, which expressly revoked the Ports Modernization Law and established a new legal framework with respect to port operations in Brazil. As a result, public ports are regulated by the Ports Law and by specific complementing regulations, such as Decree No. 8,033/2013, with its amendments and additions issued by Decree No. 10,672/2021. According to the provisions of the Ports Law, there are no more distinctions between third-party and own cargo handled at private port terminals. As a result, public ports are expected to face higher competition by private operators, as private operators are subject to less rigorous regulatory requirements than publicly owned ports. Accordingly, it is possible that Rumo may not be able to reach the minimum cargo movement provided for in its concession agreement for the operation of public port terminals, which may subject it to fines and, upon repeated violations, to the early termination of the concession. Even though the Ports Law does not provide for the adjustments of the terms of any concession agreement currently in place, it is possible that new regulations may make such provision. New regulations applicable to port operations in Brazil that might cause an adjustment of the terms in Rumo’s concession agreements may adversely affect Rumo’s results of operations.
On January 8, 2014, ANTAQ published Resolution No. 3,220/2014, which sets forth the process for requesting the economic and financial rebalancing of the concession agreements for the operation of government-owned port terminals.
Environmental Regulation
Rumo’s operations are subject to a wide range of federal, state and local laws, in addition to regulations and permit requirements regarding environmental protection in Brazil.
Rumo’s rail operations are subject to potential environmental liabilities involving the use, handling and transportation of hazardous materials. Rumo can also be held liable for damages resulting from vegetation suppression in connection with railroad expansion and other works in the vicinity of Rumo’s railroads. Locomotives are supplied with fossil fuel, which can be transported by wagon or truck, depending on the location. We have 20 active refueling stations, with a total storage capacity of over 2.3 million liters. Potential incidents and leaks at those refueling stations may result in environmental damage.
Legislation authorizes the use of herbicides throughout Rumo’s rail system to control overgrown invasive vegetation, except in permanent preservation areas, where herbicides are prohibited. Rumo is constantly researching alternatives to control invasive vegetation in partnership with environmental authorities.
Rumo possesses an interstate railroad network and, pursuant to the Complementary Federal Law No. 140/2011, the Brazilian Institute of Environment and Natural Resources (Instituto Brasileiro do Meio Ambiente e dos Recursos Naturais Renováveis), or “IBAMA,” is the federal entity competent for licensing these activities. Rumo holds operating permits that allow us to operate the railways in the states of Rio Grande do Sul, Santa Catarina, Paraná, São Paulo, Mato Grosso and Mato Grosso do Sul, pending the issuance of the operating permits for the south of São Paulo and all operating units. The issuance of these licenses by IBAMA is pending, but Rumo is currently standardizing its environmental licensing in accordance with applicable legislation.
The performance of environmental programs is essential to guarantee the granting and renewal of rail network permits and the continuity of Rumo’s operations. The following environmental programs are included as conditions in Rumo’s permits:
Rumo currently has an environmental licensing timeline for the improvement and expansion of Rumo’s rail operations. Compliance with environmental conditions imposed by the current permits is of great importance in obtaining new licensing from environmental agencies.
Rumo seeks to comply with several procedures to reduce the risks related to the transportation of hazardous materials, such as having an emergency service plan and a management risk plan, and undertaking periodical track maintenance. Rumo also has an authorization to transport hazardous materials in the states in which we operate. In addition, Rumo has put in place certain procedures to reduce the risks of leakage of hazardous materials. For example, the recent installation of automatic shut-off valves and high-level alarms at Rumo’s diesel storage areas are expected to help reduce the number of accidental discharges. Rumo’s investment program includes comprehensive upgrades to control systems that are expected to reduce the number and severity of hazardous materials leaks in cases of derailments. The environmental impact caused by the leakage of hazardous materials may vary in each case, so we perform quarterly internal audits to identify any noncompliance with the environmental standards. Rumo has identified and is in the remediation and monitoring phase with respect to certain areas of soil and groundwater contamination resulting from inadequate operation of wastewater treatment systems associated with railcar maintenance and washing and contamination from the leakage of hazardous materials.
Rumo’s environmental liabilities consist of environmental proceedings, including with respect to contaminated areas undergoing remediation, monitoring, supply posts and workshops. Rumo has been investing to resolve these liabilities. Other issues identified that require improvement include leakage prevention and leakage containment procedures, particularly with respect to avoiding water and soil contamination.
Compliance with applicable legislation is essential to fulfill the terms of current environmental permits as well as to obtain permits for new projects. Due to the need to compete for new projects and perform operational enhancements, we try to enhance and improve Rumo’s routine and operational procedures, and it is likely that Rumo’s environmental investments and costs associated with compliance with environmental legislation will increase with the passage of time in accordance with Rumo’s need to undertake new projects and improve its operations.
Rail Concessions
Rumo conducts its rail activities through the following concession agreements: (1) the concession agreement entered into on December 30, 1998 and amended on May 27, 2020 involving Rumo Malha Paulista, which was originally scheduled to expire in 2028 but in May 2020 it was extended to 2058, as Rumo complied with the required obligations; (2) the concession agreement entered into on May 19, 1989 involving Rumo Malha Norte, expiring in 2079; (3) the concession agreement entered into on July 7, 1996 involving Rumo Malha Oeste, expiring in 2026; and (4) the concession agreement entered into on February 27, 1997 involving Rumo Malha Sul, expiring in 2027 (which may be extended for a further 30 years).
In September 2015, we filed a formal request for the renewal of the Rumo Malha Sul concession agreement with the ANTT and, in January 2018, a request for extension of the concession agreement termination date.
The granting authority may unilaterally rescind all of Rumo’s rail concession agreements prior to their expiration in the following circumstances:
The enforcement of any of the unilateral termination provisions of the concession agreement must be preceded by the relevant administrative proceeding with ANTT and may result in indemnity to us for assets that revert to the granting authority. As of the date of annual report, we are aware of the existence of the administrative proceedings that could potentially give rise to unilateral termination events for our concessions, after all applicable administrative and judicial spheres have been overcome. For further information, see “Item 8. Financial Information—A. Consolidated Statements and Other Financial Information—Legal Proceedings—Probable Losses—Civil, regulatory, environmental and other claims.”
On March 28, 2019, Rumo won the tender No. 02/2018 organized by ANTT to operate the railway network located between the cities of Porto Nacional, in the State of Tocantins, and Estrela d’Oeste, in the State of São Paulo, or the Ferrovia Norte Sul Tramo Central, for 30 years. Rumo’s bid was R$2,719.5 million. On July 31, 2019, Rumo entered into a sub-concession agreement with ANTT and Valec Engenharia, Construções e Ferrovias S.A., allowing Rumo Malha Central to explore for 30 years the activities of rail freight transport and operate the Ferrovia Norte Sul Tramo Central. If Rumo is unable to comply with the obligations detailed in the tender notice for the Ferrovia Norte Sul Tramo Central, Rumo’s assets may be encumbered, which may adversely affect Rumo’s financial condition and results of operations.
See also “Item 3. Key Information—D. Risk Factors—Risks Related to Our Business, the Operations of Our Joint Venture, and Industries in Which We Operate––The loss of Brazilian railway concessions may have a material adverse effect on our business.” and “Item 3. Key Information—D. Risk Factors—Risks Related to Our Business, the Operations of Our Joint Venture, and Industries in Which We Operate––Rumo may not obtain an early renewal of the Rumo Malha Sul concession agreement, currently under review by the Brazilian Transportation Authority (Agência Nacional de Transporte Terrestre), or ANTT, which may have a material adverse effect on Rumo’s investment plan and growth strategy.”
Rail Authorization Agreements
Currently, no section of our railroad network is subject to an authorization, rather than a concession, by any governmental entity. However, on July 19, 2021, the government of the State of Mato Grosso launched a public call to receive bids for an authorization to construct a new, 730-kilometer railroad network within the state. Under current law, an authorization to construct a railway network requires no prior tender. Rather, a simplified, public call process may be used, wherein technically and financially eligible companies may submit bids for the project without an elaborate competitive process. However, whereas concession agreements typically entail the operation or expansion of an existing railway network in consideration for a guaranteed rate of return, an authorization requires a successful bidder to build a railway network from scratch, and carries with it no guarantee of success or return.
On September 20, 2021, Rumo Malha Norte entered into an adhesion agreement with the State of Mato Grosso, which allows Rumo Malha Norte to engage in the construction, operation, exploration and conservation of a railroad that independently connects the Rondonópolis railroad terminal to Cuiabá and Lucas do Rio Verde in the State of Mato Grosso.
Port Lease Agreements
Rumo holds equity interests in: (1) Terminal XXXIX and the adjacent areas for moving agricultural products and bulk as well as other goods capable of being transported in those port installations, through a port lease agreement due to expire in 2050; (2) Terminal de Granéis do Guarujá (TGG), located on the left bank of the port of Santos, for the transport of solid and liquid bulk, through an area used by Rumo Malha Norte via a leasing agreement due to expire in 2027; (3) CLI Sul S.A., located on the right bank of the Port of Santos, intended for the transport of solid bulk, through a lease agreement due to expire in 2036; and (4) Terminal Marítimo do Guarujá (TERMAG), located on the left bank of the port of Santos, mainly for the transport of solid and liquid bulk, through an area used by Rumo Malha Norte via a lease agreement due to expire in 2027.
If Rumo fails to comply with the applicable regulatory rules or contractual obligations, its lease may be terminated early pursuant to the Concession Law, which applies to port leases.
Furthermore, there are ongoing legal and administrative proceedings which question the validity or legality of Rumo’s concessions or leaseholds in port facilities, as follows: (i) ongoing legal proceeding regarding whether the execution of the lease agreement relating to Terminal XXXIX, TGG and TERMAG should have been subject to a prior bidding procedure. The Brazilian Superior Justice Court (Superior Tribunal de Justiça) sustained Rumo’s appeal by finding in its favor, to which the public prosecutor’s office filed an additional appeal, which is currently pending disposition; (ii) an ongoing public civil action filed by the Brazilian Federal Prosecutor’s Office challenging the validity of the Portofer lease agreement. A trial court has ruled in favor of Rumo and rejected the claim, but an appeal had been lodged by the Federal Prosecutor’s Office and is currently awaiting disposition; and (iii) an administrative proceeding before the Federal Court of Accounts, or the TCU, challenging the legal validity of the Portofer lease agreement. In June 2020, the TCU decided that a declaration of invalidity relating to the lease agreement would be contrary to public interest, however, the Santos Port Authority, or “SPA,” was denied the right to renew the lease agreement with Portofer for subsequent terms upon its expiration in June 2025. Considering the TCU decision and to avoid costs associated with third-party leases of the railroad in the Santos Port, the SPA issued public notice calling for members to join an association to manage the railroad in the Port area (Ferrovia Interna do Porto de Santos), or “FIPS.” Rumo, MRS and VLI Multimodal S.A. have accepted to join this association. FIPS has been created and has entered into a lease agreement with Port Authority. FPIS is expected to begin its activities following a transition process with Portofer, after which Portofer will end its activities.
Real Estate
Our real estate operations are conducted through Radar, Tellus, Gamiovapar, Duguetiapar and Janus. Through these companies, we acquire rural properties to be leased or sold to third parties. Radar, Tellus, Janus, Gamiovapar and Duguetiapar together manage approximately 305,802 hectares of land in the Brazilian states of São Paulo, Goiás, Mato Grosso, Maranhão, Minas Gerais, Tocantins, Bahia and Piauí.
In November 2021, we concluded the acquisition of an additional interest in Radar. This initiative is aligned with our capital allocation strategy and reinforces our commitments to the sustainable development of Brazilian agribusiness while creating value to all stakeholders. On September 30, 2022, we entered into a share purchase agreement for the acquisition of an additional stake in Tellus Brasil Participações S.A., Janus Brasil Participações S.A., Gamiovapar Empreendimentos e Participações S.A. and Duguetiapar Empreendimentos e Participações S.A.
Our real estate operations are subject to various Brazilian federal, state and municipal environmental and real estate laws and regulations governing, among other things, the acquisition, lease and disposal of rural properties.
Certain environmental laws require the tenants of Radar’s properties to obtain permits, licenses and approvals from governmental authorities to conduct agricultural activities and operate storage facilities. Despite Radar’s position as a real estate investor, if its tenants fail to obtain licenses and permits that they would be obliged to obtain for the use of land, Radar could be adversely impacted. We are subject to regulation by the following principal governmental agencies:
Furthermore, certain of our activities such as land ownership and georeferencing processes, are regulated by several Brazilian laws, including but not limited to the Brazilian Constitution. INCRA is responsible for approving georeferencing procedures necessary for registering any title of acquired agricultural property in Brazil. We are also subject to the Brazilian Forestry Code, which prohibits land use in certain permanently protected areas, and obliges us to maintain and register a forestry reserve in each of our rural landholdings covering at least 20% of the area in any such property. The responsibility for maintenance of forestry reserves and permanent preservation areas as required by law falls jointly upon the landowners (in our case, Radar) and any tenants.
Competition
Raízen faces competition in its fuel distribution and renewables businesses.
In the fuel distribution business, Raízen competes with companies in the sectors in which it operates and with companies in other sectors that produce similar products. Competitors include gas stations from large integrated oil companies, independent gas stations, convenience stores, fast food stores and other similar outlets, some of which are well-known Brazilian or regional retail companies. According to ANP, the three largest fuel distributors in Brazil are Vibra Energia (through the BR Petrobras brand), Raízen (through our Shell brand gas stations) and Ultrapar S.A. (through the Ipiranga brand). The main competitive factors affecting retail marketing operations include site location, product price, selection and quality, appearance and cleanliness, opening hours, safety at the store, customer loyalty and brand recognition. In the year ended December 31, 2025, we registered 28.3 billion liters of fuel sold in Brazil, while in the years ended December 31, 2024 and December 31, 2023, Raízen registered the sale, respectively, of 27.1 billion and 28.0 billion liters. In its international operations, Raízen faces competition from several other fuel distributors, including YPF, Axion and Puma, among others. In Argentina, Raízen recorded 6.9 billion liters of fuels sold in the year ended December 31, 2025.
Raízen is a leading global company in the ethanol and sugar markets, with low-cost, large-scale production and integrated operations throughout Brazil. The favorable conditions in Brazil enable sugarcane to be harvested five to six times before replanting becomes necessary, which is a major advantage relative to other countries, such as India, where sugarcane needs to be replanted every two or three harvests on average. However, Raízen faces competition from international ethanol producers who use other sources of ethanol, such as corn and sugar beet to produce ethanol fuel.
We believe that Raízen is a global leader in terms of the products it markets through the renewables and sugar segments, as follows:
Comgás’ concession area covers 96 municipalities in the metropolitan areas of São Paulo, Campinas and Santos as well as the Paraíba Valley. Comgás distributes natural gas for residential, commercial and industrial customers, and also supplies gas for use as fuel for vehicles and electricity generation. For the residential and commercial customers, Comgás holds exclusivity rights within its area of concession. For industrial customers, Comgás has exclusive distribution rights until 2049. Comgás faces competition from electricity concessionaires, oil and ethanol producers in its activities.
Sulgás is a natural gas distribution company with exclusive natural gas distribution rights in the State of Rio Grande do Sul until 2044, and it operates in the industrial, commercial, residential and automotive segment. Necta is responsible for the distribution of natural gas to the northwest area of the State of São Paulo and it has an exclusive distribution right until 2029. Necta also distributes natural gas for residential, commercial and industrial customers, and supplies gas for use as fuel for vehicles.
Edge Comercialização S.A is the marketing and services business, which offers alternative natural gas supply options to consumers while promoting decarbonization for all its customers, whether connected to the distribution network or off-grid, displacing other energy sources through road transportation. This business model relies on strategic assets such as the TRSP (São Paulo Regasification Terminal located in Santos), biomethane assets and contracts, LNG B2B (liquefied natural gas), other infrastructure projects, and gas trading.
Compagas is the concessionaire of the state-owned piped natural gas distribution service in the State of Paraná until 2054, and it operates in the industrial, commercial, residential and automotive segments.
Companies active in the Brazilian railroad transport market generally provide logistics services in their respective regions, with regions being allocated to various companies based on the public concessions granted by the ANTT. The necessity of obtaining a concession from the ANTT represents a barrier to the entry of new competitors into the market given that each concession area is granted to a single operator. As there are currently no parallel rail tracks in the Brazilian railway network, the competition in the market in which we operate primarily derives from truck transportation, which can compete for the same freight as rail operators.
Clients generally select a mode of transportation based on the freight rates charged, efficiency and volume. Given our offering of advantageous prices coupled with our significant transport capacity and greater efficiency over trucks, we believe we have significant opportunities to increase our current market share within the areas in which we operate and that we are in a better strategic position than our competitors to seize the growth opportunities in these industries.
Historically, railroad freight prices have varied in conjunction with road freight prices. Freight prices in the road transportation market have increased significantly in the past years, usually in line with the fluctuations of diesel prices. We expect this increase to also benefit railroad operators such as us, given the correlation between road and rail freight prices.
Each railway concession agreement grants the recipient concession holder an exclusive right to develop the rail network infrastructure in a particular geographic area. Because each concession holder operates in a separate geographic area, they do not compete directly with each other. Instead, the main competition to the various rail concession holders is, in most cases, the truck transportation sector, which has historically been the main form of cargo transportation in Brazil.
The main competitive factors affecting intermodal logistics operations include (1) rates charged, (2) haul time, (3) haul volume and (4) the quality and reliability of the service provided. We believe that Rumo in a strong position to compete effectively in the intermodal transportation sphere due to the lower rates it can charge due to our relatively larger transportation capacity and operational efficiencies arising from our long-term investment plan.
Patents, Licenses, Contracts and Processes
In Brazil, ownership of trademarks can be acquired only through a validly approved registration with the National Institute of Intellectual Property (Instituto Nacional de Propriedade Industrial), or “INPI,” the agency responsible for registering trademarks, patents and designs in Brazil. After registration, the owner has exclusive rights of use of the trademark throughout Brazil for a ten-year period that can be successively renewed for equal periods.
As of the date of this annual report, we own 523 trademarks in Brazil, of which 335 are owned by companies within the Cosan group and 188 are owned by companies within the Raízen group. All trademarks that are material to our business are either duly registered with, or have been applied for, registration before the INPI by us or our affiliates.
Research and Development
Our main research and development activities for the fiscal years ended December 31, 2025, 2024 and 2023 concentrated in the following key areas:
Our total research and development expenditure amounted to R$13.9 million in the fiscal year ended December 31, 2025, R$15.3 million in the fiscal year ended December 31, 2024, and R$12.0 million in the fiscal year ended December 31, 2023.
We are an integrated energy and logistics company and, when considered together with the Joint Venture, a Brazilian market leader in fuel distribution, sugar and ethanol production, natural gas distribution and logistics. Our operations include: (1) the production of sugar, ethanol and bioenergy through Raízen, which also distributes and sells fuels and lubricants under the “Shell” brand, supplying a network of service stations, airport refueling sites and business-to-business customers in Brazil, Paraguay and Argentina, where it also refines oil, manufactures and sells automotive and industrial lubricants, and produces and sells liquefied petroleum gas, and which also operates a network of Shell Select convenience stores and OXXO proximity stores; (2) through our Compass segment, (i) the distribution of piped natural gas in Southeast, South, Center, North and Northeast regions of Brazil to customers in the industrial, residential, commercial, automotive, thermogeneration cogeneration sectors through Comgás, Sulgás and the other companies in which Commit has an interest; and (ii) other investments in the development process and value chain of natural gas, with Terminal de Regasificação de LNG de São Paulo S.A., or “TRSP” and Rota 4 Participações S.A., or “Rota 4”; (3) the production and distribution of lubricants under the Mobil brand in Brazil, Argentina, Bolivia, Uruguay, Paraguay, the United States of America and certain European countries, as well as in the European and Asian markets under the “Comma” trademark and corporate activities through Moove; (4) logistics services for rail transportation, storage and port loading of commodities, mainly for grains and sugar, leasing of locomotives, wagons and another railway equipment through Rumo; (5) the management of agricultural properties and logistics projects; and (6) logistics projects and investment in the Climate Tech Fund, which specializes in technological innovation.
The chart below sets forth a simplified summary of our corporate structure as of the date of this annual report:
A list of our subsidiaries is included in note 9.1 of our consolidated financial statements as of December 31, 2025 and 2024 and for the fiscal years ended December 31, 2025, 2024 and 2023, included elsewhere in this annual report.
The investments constituting the Joint Venture are accounted for under the equity method. We and our subsidiaries own 30.84% and Shell and its affiliates likewise own 44.02% of the preferred shares (which have preferential dividend rights in certain circumstances) issued by Raízen S.A. The differences between the shareholdings of Cosan and Shell in Raízen S.A. result from an investment made on December 28, 2022 by Itaú in Cosan Nove, our investment vehicle that now holds part of the shares issued by Raízen S.A., following which our shareholding rights as co-controlling entity of Raízen pursuant to the Shareholders’ Agreement with Shell remained unchanged.
For more information related to property, plant and equipment see note 11.1 to our consolidated financial statements as of December 31, 2025 and 2024 and for the fiscal years ended December 31, 2025, 2024 and 2023, included elsewhere in this annual report. See also “—Capital Expenditures” for a description of our ongoing expansions and renovations of our property, plant and equipment.
We present a summary below of our material tangible fixed assets, including investment properties and intangible assets (concessions), by segment:
Raízen distributes fuels through 70 distribution terminals to approximately 7,692 service stations throughout Brazil, Argentina and Paraguay under the Shell brand and also has 68 airport terminals supplying aviation fuel. In addition, in its energy generation business, Raízen operates 35 bioenergy parks (29 of which are currently operational), has an installed capacity for grinding 105 million tons per year of sugarcane and installed capacity to generate 1.6 GW of power (the largest energy generation capacity from sugarcane in the world according to LMC data), a second-generation (E2G) ethanol plant and a biogas plant.
In 2018, Raízen acquired Shell’s downstream operations in Argentina. The assets acquired consist of a refinery, located in the Buenos Aires metropolitan region, with a refining capacity of 109 thousand barrels per day, which distributes fuels and lubricants through 892 strategically located service stations under the Shell brand.
On November 1, 2021, Raízen concluded the acquisition of 50% of the capital stock of Barcos y Rodados S.A., or “B&R.” B&R is based in Paraguay and is the leader in the fuel distribution market in Paraguay, with a network of 340 fuel resale stations. With the acquisition and sublicense of the right to use the Shell brand in the B&R network, the B&R service stations will progressively start operating under the Shell brand. Raízen’s shareholding in Raízen Paraguay was reduced from 50% to 42.48% in December 2024. In December 2025, Raízen Energia S.A. further decreased its equity interest in Raízen Paraguay S.A. from 42.48% to 34.96%.
On May 1, 2022, Raízen concluded the acquisition of the entirety of Shell Brasil Petroleo Ltda.’s lubricants operations in Brazil, including a production unit strategically located in Ilha do Governador, Rio de Janeiro, that produces and distributes lubricants under Shell brand in Brazil.
Compass is the holding company through which we own interests in a number of businesses which make up our Compass segment:
Moove has five production plants. In Brazil there are two plants, one in the city of Rio de Janeiro, State of Rio de Janeiro, where the largest plant of the business, with its own pier, is located, and the second one, in the city of Diadema, State of São Paulo, where products are produced under the Tirreno brand. Outside of Brazil, Moove has a plant in Gravesend, England, where it produces and distributes lubricants and other automotive products, such as antifreeze, additives and coolants. Through these plants products are shipped to the UK markets and exported to certain countries in Europe and Asia, mainly under the Comma brand. It also has two other plants in the United States in the cities of Wichita, Kansas, and another one in Indianapolis, Indiana, where lubricants and other automotive products are produced under the Dynaplex, Ecoultra and Medallion Plus brands.
Through these plants, Moove produces and markets a comprehensive portfolio of lubricant products and specialties for various sectors — from automotive to industrial — providing the market with innovative solutions in high-performance products and services.
Rumo concluded the ALL Acquisition on April 1, 2015 and is Brazil’s largest logistics operator in terms of total volume transported, providing rail transport logistics, port handling and warehousing services. Rumo operates in the states of Mato Grosso, Mato Grosso do Sul, Goiás, Tocantins, São Paulo, Paraná, Santa Catarina and Rio Grande do Sul.
Currently, Rumo owns and operates a large asset base, including a rail network consisting of five concessions that extend to over approximately 13,500 kilometers of railway lines, over 1,400 locomotives, over 35,000 rail cars, as well as distribution centers and warehousing facilities. Rumo provides efficient and complete logistics services to its clients through its operation of ten transshipment terminals and five port terminals, either controlling or minority interest. At its most important terminal, the logistics complex of Rondonópolis (in the State of Mato Grosso), Rumo has the capability to load over 2,000,000 tons of grains per month depending on the period and assortment of transported volumes. Moreover, Rumo holds equity interests in five port terminals in the port of Santos, in the State of São Paulo, and one in the State of Paraná. The real estate Rumo leases in connection with its concessions contain available area for construction and development of warehouses and logistics terminals, which makes possible for Rumo to expand its operations and improve its logistics and other services. For example, Rumo currently holds a 10.0% equity interest in the Grain Terminal of Guarujá (TGG) in the port terminal in Santos, which is a significant port project. To expand its North Operation, in September of 2021, Rumo signed an agreement with the State of Mato Grosso to construct and operate a railway stretch that independently connects the road-rail terminal of Rondonópolis to Cuiabá and Lucas do Rio Verde in the State of Mato Grosso.
Radar
Our real estate operations are conducted through Radar, Radar II, Tellus, Janus, Gamiovapar and Duguetiapar. Radar and Radar II own and manage approximately 416 rural properties covering a total of 90,128 thousand hectares, and harvests sugarcane, soy, cotton, corn and other commodities in the States of São Paulo, Maranhão, Bahia and Mato Grosso. Radar manages its properties using a satellite-based geomonitoring system. Tellus, Janus, Gamiovapar and Duguetiapar oversee approximately 408 rural properties, covering a total of 206,223 hectares 142,452 hectares of which are considered useful), dedicated to the harvesting of sugarcane, soy, cotton, corn and other commodities in several States of Brazil. For more information on our real estate operations, see “Item 4. Information on the Company—B. Business Overview—Real Estate.”
Our capital expenditure program is currently focused on the following areas (each of these primarily within Brazil):
Raízen’s investment plan for the year ended December 31, 2025 consisted of the following: (i) planting and treating sugarcane fields – biological assets (R$3,097 million); (ii) maintaining industrial, agricultural, logistics and distribution assets, and assets relating to adapting and developing our standards for environmental safety and health related in the production of sugar, ethanol and electricity (R$3,057 million); (iii) improvements and expansions related to sugar, ethanol and electricity (R$1,933 million); and (iv) expand the network of operations in retail, aviation and distribution terminals in Brazil with a focus on profitability and sustainable growth (R$1,015 million). Raízen’s total projected capital expenditure in Argentina was R$1,144 million, of which approximately R$621 million refers to a nonrecurring project to modernize our refining facilities, while the remainder is for maintenance and other operational improvements.
Moreover, Raízen invests in maintaining and renewing sugarcane fields at approximately 38.3% of its total capital expenditures per year. Raízen also invests every year in intercrop maintenance (i.e., primarily in plant and agricultural machine repairs during the times in which no operations are ongoing). The biological asset and intercrop maintenance capital expenditures totaled approximately R$3,715.0 million in the fiscal year ended December 31, 2025.
Compass’ strategy has been focused on investments in the expansion of its network (fixed assets, intangible assets and contract assets), which during the fiscal year ended December 31, 2025, amounted to R$2,197.1 million.
Comgás has been investing in its network expansion. During the fiscal year ended December 31, 2025, it invested R$1,452.7 million, of which approximately 45.9% was associated with expansion programs, approximately 37.8% was related to network support investments, and approximately 16.3% was related to administrative and software investments.
Sulgás has been investing in its network expansion. During the fiscal year ended December 31, 2025, Sulgás invested R$96.6 million, of which approximately 48% was associated with expansion programs, approximately 28% was related to network support investments and approximately 24% was related to administrative and software investments.
Necta has been investing in the expansion of its network. During the fiscal year ended December 31, 2025, it invested R$50.5 million, of which approximately 82% was related to network support investments, and approximately 18% was related to administrative and software investments.
Compagas, a subsidiary of Compass, has been investing in the expansion of its network. During the fiscal year ended December 31, 2025, it invested a total of R$ 92.3 million, of which approximately 81.2% was related to network support investments, and approximately 18.2% was related to administrative and software investments.
Edge has been investing in the expansion of its network to offer alternative natural gas supply options. During the fiscal year ended December 31, 2025, Edge’s capital expenditure totaled R$477.0 million.
The funds used by Comgás, Sulgás, Necta, Compagas and Edge for making capital expenditures are generated from their working capital and existing or new indebtedness.
Rumo’s strategy is focused on investments in the renovation of assets, in particular its locomotives and railcar fleet, through the purchase of new rolling stock to replace assets in poor condition of use. The purpose of Rumo’s investment in rail tracks is to reduce its operating costs and maximize its transport volume. As a result of Rumo’s ongoing efforts, Rumo is increasing capacity while reducing transit time along some of our major routes. During the fiscal year ended December 31, 2025, Rumo’s total investments in fixed assets, intangible assets and contract assets amounted to R$6,096.3 million in the aforementioned initiatives. The main investments in capacity expansion were (1) the extension of the railway network in Mato Grosso, one of the main grain production regions in Brazil; (2) upgrading the permanent way by replacing tracks and sleepers; (3) expanding yards to adjust for the 135-railcar train; and (4) infrastructure improvements, with the aim of removing restrictions.
The funds used by Rumo for making capital expenditures are provided by Rumo’s operating results and from financings and credit extended by private banks, capital markets, as well as by government-owned banks such as BNDES.
As of December 31, 2025, Moove’s capital expenditures (fixed assets, intangible assets and contract assets) totaled R$ 146.1 million, of which 48.6%, or R$71.0 million, was invested in Moove’s South America operations, 3.5%, or R$ 5.0 million in Moove’s European operations and 47.9%, or R$ 70.0 million in Moove’s North American operations. The funds used by Moove for making capital expenditures are generated from cash flows generated from operations and existing or new indebtedness.
Raízen and its consolidated subsidiaries are not consolidated in our financial statements. Nevertheless, we have included below a summary of business performance derived from note 4 (Segment information) to our consolidated financial statements included elsewhere in this annual report.
Results of Operations for the Joint Venture for the Fiscal Year Ended December 31, 2025 Compared to the Fiscal Year Ended December 31, 2024
The following table presents Raízen’s comparative consolidated financial information for the years ended December 31, 2025 and 2024.
228,802.0
251,198.8
(8.9)
(7.6)
(32.1)
(6,034.1
(6,634.6
(9.1)
(3,020.5
(22.1)
Other operating income (expenses), net
(1,468.6
2,029.4
(172.4)
(6,496.7
n.m.
Interest in losses of associates
(89.7)
Interest in losses of joint ventures
Equity in losses of investees
(14.3)
Finance expense
(8,263.6
(4,741.9
74.3
Finance income
3,009.1
995.4
202.3
Foreign exchange, net
2,834.4
(4,974.0
(157.0)
Net effect of derivatives
Income taxes
(5,838.5
(1,102.5
429.6
Loss for the year
n.m. = not meaningful.
Raízen’s net sales decreased by 8.9%, or R$22,396.8 million, to R$228,802.0 million in the year ended December 31, 2025, from R$251,198.8 million in the year ended December 31, 2024. This decrease was primarily due to (i) a decrease in diesel sales revenues in Brazil and Argentina of 10.4%, or R$10,917.4 million; and (ii) a decrease in net operating revenue from renewables and sugar of 11.6%, or R$7,484.0 million, mainly driven by a 19.7% decrease in the volume of sugar sales and a 15.7% decrease in the volume of ethanol sales.
Costs of sales
Raízen’s costs of sales decreased by 7.6%, or R$18,041.3 million, to R$219,595.3 million in the year ended December 31, 2025, from R$237,636.6 million in the year ended December 31, 2024, mainly due to (1) a 4.1% decrease, or R$7,503.1 million, in the cost of sales in Raízen’s mobility segment and (2) a decrease in the cost of sales in Raízen’s renewables and sugar business of 6.8%, or R$4,121.4 million.
Raízen’s gross profit decreased by 32.1%, or R$4,355.4 million, to R$9,206.7 million in the year ended December 31, 2025, from R$13,562.1 million in the year ended December 31, 2024 (representing 4.0% and 5.5% of net sales, respectively), for the reasons indicated above.
Raízen’s selling expenses decreased by 9.1%, or R$600.5 million, to R$6,034.1 million in the year ended December 31, 2025, from R$6,634.6 million in the year ended December 31, 2024, mainly due to lower logistics costs incurred as a result of a decrease in sales volumes.
General and administrative expenses were R$ 2,351.9 million in 2025, down R$ 668.6 million from 2024. The decrease reflects lower compensation and benefits, partially offset by higher rent and lease expenses. Compensation and benefits decreased by R$ 341.7 million, mainly due to a cost reduction program, including lower headcount and reduced variable compensation.Raízen expects part of these savings to continue, although future levels may vary with hiring needs and performance-based pay. Rent and lease expenses increased by R$ 172.9 million, driven by new leases, contract renewals at higher rates, and the consolidation of additional office and operational sites. Rent expense may remain elevated as these contracts run through their terms, but could change ifRaízen renegotiates or exits certain leases.
Other operating (expenses) income, net
Raízen’s other income (expenses), net shifted unfavorably by R$3,498.0 million, from net income of R$2,029.4 million for the year ended December 31, 2024, to a net expense of R$1,468.6 million for the year ended December 31, 2025. This shift was mainly driven by the recognition of comparative credits in the prior year (approximately R$1.8 billion), as well as divestments and impairment losses recorded during the current harvest.
During the year ended December 31, 2025, our share of the results of the joint venture, in which we hold a 30.84% direct and indirect interest and which we account for under the equity method, was primarily driven by a non-recurring impairment loss of R$ 6.5 billion. The recognition of this loss reflects significant uncertainty regarding the entity’s ability to continue as a going concern, a condition resulting from a highly leveraged capital structure, continued cash consumption, and subsequent downgrades in its corporate credit rating. Although the entity’s management has implemented a transformation plan focused on operational efficiency and the optimization of core businesses, persistent macroeconomic headwinds, particularly the decline in agricultural productivity and the drop in sugar and ethanol prices, have constrained the ability to offset the underlying financial imbalance through operational execution alone, ultimately necessitating the write-down of certain non-financial assets and deferred tax assets.
Raízen’s net finance expenses increased by 25.5%, or R$1,856.7 million, to R$9,130.0 million in the year ended December 31, 2025, from R$7,273.3 million in the year ended December 31, 2024. This increase was primarily due to (i) a higher net debt balance of R$55,322.1 million as of December 31, 2025, compared to R$38,590.3 million as of December 31, 2024, and (ii) a higher average CDI rate in the year ended December 31, 2025, compared to the year ended December 31, 2024, which were partially offset by higher revenue from the monetary correction on tax credits.
Raízen’s total income and social contribution taxes changed by R$4,736.0 million, to an expense of R$5,838.5 million in the year ended December 31, 2025, from an expense of R$1,102.5 million in the year ended December 31, 2024 (representing (2.6)% and 0.5% of net sales, respectively), primarily due to the decrease in the result before income and social contribution taxes for the reasons indicated above.
Raízen’s loss for the year increased by R$19,639.9 million, to a loss of R$22,315.0 million in the year ended December 31, 2025, from a loss of R$2,675.1 million in the year ended December 31, 2024 (representing 9.8% and 1.1% of net sales, respectively), for the reasons indicated above.
Results of Operations for the Joint Venture for the Fiscal Year Ended December 31, 2024 Compared to the Fiscal Year Ended December 31, 2023
The following table presents Raízen’s comparative consolidated financial information for the years ended December 31, 2024 and 2023.
221,693.3
13.3
17.1
(27.7)
(5,773.5
14.9
(2,815.5
7.3
1,968.2
7.1
(6,241.3
(24.0)
797.6
24.8
1,240.9
(182.2)
22.0
(126.4)
(1,936.6
(43.1)
(166.4)
Raízen’s net sales increased by 13.3%, or R$29,505.5 million, to R$251,198.8 million in the year ended December 31, 2024 from R$221,693.3 million in the year ended December 31, 2023. This increase was primarily due to (i) an increase in oil derivative products sales revenues in Brazil, Argentina and Paraguay of 9.4%, or R$16,433.4 million, mainly driven by ethanol sales volumes, which increased by 31.3%, partially offset by a decrease in sales of other oil derivative products; and (ii) an increase in net operating revenue from renewables and sugar of 25.2%, or R$12,977.5 million, mainly driven by a 26.8% increase in the volume of sugar sales and a 20.3% increase in the volume of ethanol sales, which were partially offset by a decrease in energy sales of 12.7% and decreases in the average prices of sugar, ethanol and energy of 1.9%, 12.1% and 14.3%, respectively.
Raízen’s costs of sales increased by 17.1%, or R$34,709.8 million, to R$237,636.6 million in the year ended December 31, 2024 from R$202,926.8 million in the year ended December 31, 2023, mainly due to (1) a 11.9% increase in the cost of sales in Raízen’s mobility segment driven by an increase in the price of oil derivative products, resulting in a R$19,221.1 million increase in Raízen’s costs of goods sold and services provided, and (2) an increase in the cost of sales in Raízen’s renewables and sugar business of 34.6% or R$15,553.5 million.
Selling Expenses
Raízen’s selling expenses increased by 14.9%, or R$861.1 million, to R$6.634.6 million in the year ended December 31, 2024, from R$5.773.5 million in the year ended December 31, 2023, mainly due to higher logistics costs incurred as a result of an increase in the volume of sales of its own sugar and ethanol, as well as inflation between the periods.
Raízen’s gross profit decreased by 27.7%, or R$5,204.3 million, to R$13,562.2 million in the year ended December 31, 2024 from R$18,766.5 million in the year ended December 31, 2023 (representing 5.4% and 8.5% of net sales, respectively), for the reasons indicated above.
Other income (expenses), net
Raízen’s operating income increased by R$61.2 million, to a R$2,029.4 million net income in the year ended December 31, 2024, from a R$1,968.2 million net expense in the year ended December 31, 2023. This increase was mainly due to the recognition of PIS and COFINS tax credits amounting to R$1,824.0 million related to the exclusion of ICMS from the taxable base-amount, following a ruling from the Brazilian federal revenue service.
Raízen’s finance results, net increased by 22.0%, or R$1,310.4 million, to an expense of R$7,273.3 million in the year ended December 31, 2024, from an expense of R$5,962.8 million in the year ended December 31, 2023. This increase was primarily due to (1) foreign exchange variations related to the devaluation of the real which led to an increase in financial expenses of R$6,214.9 million, which was partially offset by the positive results arising from market-to-market valuations of derivatives in an amount of R$3,207.3 million; (2) an increase in finance income of R$197.8 million primarily due to the increase in interest rates, and (3) a reduction in the cost of interest on the financing and borrowings which impacted finance costs in an amount of R$1,499.4 million.
Profit (loss) before income taxes
Raízen’s profit before income tax changed by R$7,535.4 million, to an expense of R$1,572.5 million in the year ended December 31, 2024 from an income of R$5,962.9 million in the year ended December 31, 2023 (representing negative 0.6% and 2.7% of net sales, respectively), for the reasons indicated above.
Raízen’s total income and social contribution taxes changed by R$834.1 million, to an expense of R$1,102.5 million in the year ended December 31, 2024, from an expense of R$1,936.6 million in the year ended December 31, 2023 (representing 0.4% and 0.9% of operating revenue, net, respectively), primarily due to the decrease of the result before income and social taxes for the reasons indicated above.
Profit (loss) for the year
Raízen’s profit (loss) for the year decreased by R$6,701.4 million, to a loss of R$2,675.1 million in the year ended December 31, 2024 from a profit of R$4,026.3 million in the year ended December 31, 2023 (representing 1.1% and 1.8% of operating revenue, net sales, respectively), for the reasons indicated above.
Legal and Administrative Proceedings of the Joint Venture
In the ordinary course of business, Raízen and its subsidiaries are parties to numerous judicial and administrative proceedings of a tax, civil, regulatory, environmental, criminal and labor nature, including proceedings with probable, possible and remote risks of loss.
Pursuant to the framework agreement which was entered into during the formation of the Raízen joint venture, Raízen has agreed that it will reimburse its shareholders, i.e., Cosan S.A. and Shell, or will be reimbursed by them, as applicable, for any amounts received or paid in connection with legal proceedings, provided that the triggering events for such payments or receipts occurred before the formation of the Raízen joint venture on April 1, 2011 and provided that any such sums have actually been paid or received.
As of December 31, 2025, Raízen and its subsidiaries were party to proceedings with a probable risk of loss involving an aggregate amount of R$1,511.4 million for which provisions have been made. Raízen and its subsidiaries were also party to proceedings for which our risk of loss was deemed possible which involved an aggregate amount of R$24,685.4 million and for which no provision has been made.
Raízen and its subsidiaries constitute provisions for tax, civil, environmental and labor contingencies in which our risk of loss is considered probable, in accordance with IFRS Accounting Standards. Determination of the likelihood of loss includes determination of available evidence, hierarchy of laws, jurisprudence available, more recent court decisions and relevance thereof in the legal system, as well as an evaluation by internal and external attorneys. Such provisions are reviewed and adjusted to take into account changes in circumstances, such as statute of limitations applicable, tax inspection conclusions or additional exposures identified based on new matters or court decisions.
Below is a description of Raízen and its subsidiaries’ principal proceedings:
Tax Proceedings
Labor And Employment Law Proceedings
Civil and Environmental Proceedings
Criminal Actions and Investigations Involving Raízen
Criminal Investigations Involving Raízen’s Employees
On July 31, 2018, the Civil Police of the State of Paraná launched Controlled Margin Operation to investigate alleged violations by Raízen and other distributors involving the coordination of resale prices at gas stations in the region. The operation involved dawn raids and temporary arrest of some individuals, but the arrest warrants were withdrawn after three days. In April 2025, a criminal complaint was filed alleging the commission of the offense set forth in Article 4, item II, subitem “a” of Law No. 8,137/1990 (crime against the economic order) as well as that set forth in Article 29 of the Brazilian Penal Code (co-perpetration). The complaint was admitted by the court, and the proceeding is currently in the stage of submission of the defendants’ responses to the charges.
On July 31, 2018, in connection with Operation Dubai, the Public Prosecutor’s Office of the Federal District filed a complaint against, among other parties, one employee of Raízen in relation to certain alleged anticompetitive practices. This proceeding involves an aggregate amount of R$151.7 million, to us and our employees, and a total amount at issue of R$996.7 million. Regarding the criminal action, in January 2024, the Public Prosecutor presented its final arguments requesting the acquittal of Raízen’s employee due to lack of evidence. In May 2025, a judgment was rendered acquitting the Raízen employee. No appeal was filed, and the favorable decision became final. As a result, the full amount related to Raízen and its employee was released.
Operation Dubai also involves an administrative proceeding. On October 25, 2024, the Brazilian Antitrust Authority issued its final technical opinion in this administrative proceeding recommending the dismissal of the case in favor of Raízen and its employee due to lack of evidence of market division, as well as based on the standard nature of Raízen’s and its employee’s conduct in the relevant transactions. In July 2025, the tribunal of the Brazilian Antitrust Authority rendered a decision to dismiss the case and exclude Raízen from the list of defendants. The alleged evidence presented against the fuel distributors and the individuals associated with them was deemed insufficient.
None.
The following discussion of our financial condition and results of operations should be read in conjunction with our consolidated financial statements, as well as with the information presented under the sections entitled “Presentation of Financial and Other Information” and “Item 3. Key Information—A. Selected Financial Data.”
The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including those set forth in “Forward-Looking Statements” and “Item 3. Key Information—D. Risk Factors.”
Financial Presentation and Accounting Policies
Presentation of Financial Information
We have included in this annual report the consolidated financial statements of Cosan S.A. as of December 31, 2025 and 2024 and for the years ended December 31, 2025, 2024 and 2023, which were prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS Accounting Standards”), as further discussed under “Presentation of Financial and Certain Other Information—Financial Statements.”
Investments in entities which we do not control, but it is either a joint venture or we have significant influence over, are accounted for using the equity method. The results of operations of Raízen S.A., our Joint Venture, are accounted for using the equity method.
See also “Presentation of Financial and Certain Other Information.”
Business Segments and Presentation of Segment Financial Data
We present the following reportable segments:
(1) Raízen: operates in (i) the production, commercialization, origination, and trading of ethanol, (ii) the production and commercialization of bioenergy, (iii) the resale and trading of electric power, (iv) the production and marketing of other renewable products (solar energy and biogas), (v) the production, marketing, origination, and trading of sugar, and (vi) the trading and marketing of fossil fuels, renewable fuels, and lubricants through a franchised network of service stations operating under the Shell brand throughout Brazil and in Latin America, with operations in Argentina and Paraguay. For further information, see “Item 4. Information on the Company—B. Business Overview—Raízen,” “Item 4. Information on the Company—E. Supplemental Information About Joint Venture” and note 4 “Segment Information” to our audited consolidated financial statements as of December 31, 2025 and 2024 and for the fiscal years ended December 31, 2025, 2024 and 2023, included elsewhere in this annual report;
(2) Compass: its principal activities comprise: (i) the distribution of piped natural gas in the South, Southeast, and Midwest regions of Brazil to customers in the industrial, residential, commercial, automotive, and cogeneration segments; (ii) the marketing of natural gas; and (iii) other investments currently under development;
(3) Moove: operates in the production, formulation, and distribution of high-performance lubricants, base oils, and specialty products, headquartered in Brazil with operations across 10 countries in South America, North America, and Europe. It distributes and sells products under the Mobil brand and various proprietary brands to different end markets, including the industrial, commercial, passenger vehicle, and cargo vehicle segments;
(4) Rumo: provides logistics services encompassing rail transportation, warehousing, and port loading of goods — primarily grains and sugar — as well as the leasing of locomotives, railcars, and other railway equipment, and the operation of containers;
(5) Radar: a benchmark in agricultural property management, Radar invests in a diversified portfolio with high appreciation potential through equity interests in Radar, Tellus, and Janus; and
(6) Cosan Corporate: represents the corporate structure of Cosan, which comprises: (i) senior management and corporate teams, which incur general and administrative expenses and other operating expenses (income), including pre-operational investments; (ii) equity in earnings of investments; and (iii) financial results attributable to cash and debt held at the parent company, intermediate holding companies (Cosan Nove and Cosan Dez), offshore financial entities, and the investment in the Climate Tech Fund, a fund managed by Fifth Wall and focused on technological innovation.
Principal Factors Affecting Our Results of Operations
In addition to the factors that are described in “Item 4. Information on the Company—B. Business Overview,” our results of operations have been influenced and will continue to be influenced by the following key factors:
Brazilian Economic Environment
The Brazilian economic environment has historically been characterized by significant variations in economic growth, inflation and currency exchange rates. Our results of operations and financial condition are influenced by these factors and the effect that these factors have on employment rates, the availability of credit and average wages in Brazil. The following table sets forth Brazilian inflation rates, interest rates, and exchange rates for the periods indicated:
GDP growth
1.8%
4.0%
2.1%
Inflation (IGP M)
(1.0)%
6.5%
(3.2)%
Inflation (IPCA)(1)
4.3%
4.8%
4.6%
Interbank rate – CDI (2)
14.3%
10.9%
13.0%
SELIC average rate
14.90%
11.15%
11.65%
Long term interest rates (3)
9.07%
7.4%
6.6%
Exchange rate at the end of the period per U.S.$1.00
5.50
6.19
4.84
Average exchange rate per U.S.$1.00
5.59
5.39
5.00
Appreciation (depreciation) of the real against the U.S. dollar (4)
(11.1)%
27.9%
(7.3)%
Exchange rate at the end of the period per €1.00
6.47
6.44
5.35
Average exchange rate per €1.00
6.31
5.83
5.40
Appreciation (depreciation) of the real against the Euro (4)
0.5%
20.3%
(3.9)%
Exchange rate at the end of the period per ¥1.00
0.04
0.04
0.03
Average exchange rate per ¥1.00
Appreciation (depreciation) of the real against the Yen (4)
(11.0)%
15.3%
(13.5)%
Exchange rate at the end of the period per £1.00
7.41
7.76
6.16
Average exchange rate per £1.00
7.36
6.90
6.21
Appreciation (depreciation) of the real against the Pound (4)
(4.5)%
26.0%
(1.9)%
Sources: IBGE, Central Bank of Brazil, B3 and Fundação Getúlio Vargas, or “FGV.”
Any deterioration in Brazil’s rate of economic growth, or changes in interest rates, the unemployment rate or price levels generally, may limit the availability of credit, income and purchasing power of our customers, thereby adversely affecting demand for our products. Our international operations expose us to political and economic risks in other countries. The Brazilian economy is also exposed to global macroeconomic conditions. Accordingly, the deterioration of economic and market conditions in other countries may have a negative impact on the Brazilian economy and on our business. See also “Item 3. Key Information—D. Risk Factors—Risks Related to Our Businesses and the Industries in Which We Operate Generally” and “Item 3. Key Information—D. Risk Factors—Risks Related to the Countries in Which We Operate.”
Acquisitions, Partnerships and Corporate Restructurings
Our strategy is to be a leading Brazilian group in the energy and logistics sectors. For this reason, since May 2004, we have expanded our operations primarily through acquisitions, partnerships and corporate restructurings. We have also diversified into other operations to become a vertically integrated energy and logistics company.
The profitability of our sugar products is mainly affected by fluctuations in the international price of raw sugar and in the real/dollar exchange rate. International raw sugar prices are determined based on the New York Board of Trade Futures Contract No. 11, or “NY11.” Refined sugar trades at a premium to raw sugar, known as the “white premium,” and its price is determined based on the London International Financial Futures and Options Exchange Contract No. 5, or “LIFFE No. 5.” Prices are affected by the perceived and actual supply and demand for sugar and its substitute products. The supply of sugar is affected by weather conditions, governmental trade policies and regulations, and the amount of sugarcane and sugar beet planted by farmers, including substitution by farmers of other agricultural commodities for sugarcane or sugar beet. Demand is affected by growth in worldwide consumption of sugar and the prices of substitute sugar products. From time to time, imbalances may occur between overall sugarcane and sugar beet processing capacity, sugarcane and sugar beet supply and the demand for sugar products. Prices of sugar products are also affected by these imbalances, which, in turn, impact our decisions regarding whether and when to purchase, store or process sugarcane and whether to produce sugar or more ethanol.
The table below sets forth the prices for raw sugar NY11 for the periods indicated:
Initial quote
0.1485
0.1911
0.2176
Closing quote
0.1501
0.1926
0.2058
Daily average quote
0.1497
0.1918
0.2117
High quote
0.1522
0.1935
0.2188
Low quote
0.1480
0.1904
0.2033
Source: NYBOT; prices from the 1st Generic Future. Bloomberg.
Our ethanol products are affected by domestic Brazilian and international prices of ethanol, competition, governmental policies and regulations, and market demand for ethanol as an alternative or additive to gasoline. The price for ethanol we sell in Brazil is set in accordance with market prices, using indices published by the Agriculture School of the University of São Paulo (Escola Superior de Agricultura Luiz de Queiroz—ESALQ) and B3 as a reference. Prices for ethanol we export are set based on international market prices, including the New York Board of Trade’s recently launched ethanol futures contract. Prices for the industrial alcohol and bottled alcohol products we sell are also set based on market prices and have been historically higher than market prices for ethanol.
The table below sets forth the prices for hydrous ethanol in the Brazilian market for the periods indicated:
448.91
382.30
522.80
553.94
427.50
392.90
508.50
443.78
480.60
Monthly average quote
490.30
443.32
482.40
565.32
488.60
617.20
337.80
376.60
Source: ESALQ.
The table below sets forth the prices for anhydrous ethanol in the Brazilian market for the periods indicated:
491.30
433.80
600.80
602.90
486.40
436.10
561.41
501.32
556.24
618.80
566.70
693.50
421.30
430.20
The following table sets forth our average selling prices (in R$ per thousand liters) for ethanol in the export market for the periods indicated:
Average Unitary Price
3,042.20
2,671.20
4,090.92
Source: Cosan/Raízen.
Demand for Fuels
Demand for natural gas, gasoline, ethanol and diesel is susceptible to volatility related to the level of economic activity in Brazil, Argentina and Paraguay, and may also fluctuate depending on the performance of specific industries. We expect that a decrease in economic activity would adversely affect demand for fuels.
Currency Fluctuations
A significant proportion of the sales of sugar of Raízen, a significant proportion of natural gas purchases of Compass, and a significant proportion of the base oil purchases of CLE are conducted in U.S. dollars. Therefore, a depreciation of the real against the U.S. dollar would have the effect of increasing our sales in Raízen, and increasing our costs of sales in Compass and Moove. An appreciation of the real against the U.S. dollar would have the opposite effect.
A significant proportion of our debt is denominated in U.S. dollars and Euro. A depreciation of the real against the U.S. dollar and Euro would increase our debt burden and our related financial expenses. However, we have receivables and other financial assets denominated in U.S. dollars, which would partially offset the impact that a depreciation of the real would have on our financial position. An appreciation of the real against the U.S. dollar and Euro would have the opposite effect.
See also “—Hedging Transactions and Exposures.”
Our business is subject to a degree of seasonality as described below. See also “Item 3. Key Information—D. Risk Factors—Risks Related to Our Business, the Operations of Our Joint Venture, and Industries in Which We Operate—We operate in sectors in which market demand and prices are cyclical and affected by weather and economic conditions in Brazil and worldwide.”
Raízen is subject to seasonal trends based on the sugarcane growing cycle in the Central-South region of Brazil. The annual sugarcane harvesting period in the Central-South region of Brazil begins in April/May and ends in November/December. This creates variations in inventory, which is usually high in November due to harvest dynamics and a degree of seasonality in gross income from sales of ethanol and sugar, and is significantly lower in the quarter ending March 31. In addition, Rumo is subject to the seasonality that influences the sugarcane and grain harvest. During the peak months of the harvests, there is higher demand for transport and logistics operations.
Inflation
Inflation rates in Brazil were 4.5% in 2020, 10.1% in 2021, 5.8% in 2022, 4.6% in 2023, 4.8% in 2024 and 4.3% in 2025, as measured by the IPCA, published by the IBGE. The inflation rate reached a level of 4.3% for the 12-month period ending December 31, 2025 and 3.81% for the 12-month period ending February, 2026.
Inflation affects our financial performance by increasing certain of our operating expenses denominated in reais (and not linked to the U.S. dollar). These operating expenses include labor costs, leases, and selling and general administrative expenses. However, inflation did not have a material impact on our business for the periods presented.
As a result of COVID-19’s continuous disruption of global supply chains and the ongoing armed conflicts between Russia and Ukraine and in the Middle East, inflationary pressure has increased in Brazil and around the world in the markets in which we operate. These inflationary pressures may lead to an increase in our costs and expenses which could ultimately impact our profitability.
See also “Item 3. Key Information—D. Risk Factors—Risks Related to the Countries in Which We Operate—Inflation and government measures to curb inflation may adversely affect the Brazilian economy, the Brazilian securities market, our business and operations, and the market prices of our shares.”
Cost Structure
The cost structure of Raízen is affected mainly by variable costs related to purchase of crude oil (Argentina), and fuels (mainly gasoline, ethanol and diesel). Costs related to our property, plant and equipment incur fixed depreciation charges which increase in line with our capital expenditure. Costs that are linked to the prices of our products and costs that are not linked to the prices of our products. Two of our principal cost components, raw materials and land leases, are linked to the prices of our products. Accordingly, we adjust the prices of our products to follow fluctuations in the cost of our raw materials and leased land, substantially minimizing the impact of this cost volatility on our results of operations. In addition, another relevant portion of our costs is represented by agricultural and industrial inputs, some of which are imported and which are also subject to price fluctuations, primarily as a result of exchange rate variations. As 30% of our net sales are derived from exports, a portion of fluctuations in the costs of these inputs is offset by similar fluctuations in our Brazilian and international prices, minimizing the impact of this cost volatility on our results of operations.
Our cost structure for Compass is affected by fixed and variable costs. Costs related to our property, plant and equipment incur fixed depreciation charges which increase in line with our capital expenditure. Costs relating to the natural gas resource, costs relating to transportation and other gas services are affected by volumes sold.
The cost of oil, gas and related products is linked to oil and natural gas commodity prices driven by the Platts Japan Borea Marker, a benchmark price that reflects the spot market value of liquefied natural gas, and Brent the leading global price benchmark for basin crude oils. The war between Russia and Ukraine and the recent conflicts in the Middle East have caused and continue to cause an imbalance in supply and demand for a range of products and services, including oil and natural gas, in addition to increased uncertainty regarding the global macroeconomic environment and energy prices.
Our cost structure for Moove is affected by the cost of imported base oil and additives for lubricants blending.
Our cost structure for Rumo is affected by fixed and variable costs. Costs related to our property, plant and equipment incur fixed depreciation charges, which increase in line with our capital expenditure. Costs relating to the transportation of sugar and other commodities are partially dependent on sales volumes.
Other Factors
Other factors that will impact the results of our operations include:
Hedging Transactions and Exposures
Our management has overall responsibility for the establishment and oversight of our risk management framework. Our board of directors has established the risk management committee, which is responsible for developing and monitoring our risk management policies. The committee reports regularly to our board of directors on its activities.
Our risk management policies are established to identify and analyze the risks that we face, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and our activities. Our management, through its training, standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.
Our hedging strategy consists of (i) foreign exchange forward contracts and/or options indexed to foreign exchange to hedge foreign currency exposures and expenses, (ii) derivative contracts to hedge exposure to fixed interest rates in reais, converting such debts into floating rates, (iii) interest rate and inflation swaps, and (iv) interest rate and exchange rates.
In addition, Raízen hedges part of the future price risk of its sugar production (that which it believes will be exported) and of its exchange rate derivative transactions using future contracts, options and swaps. Its hedging strategy seeks to protect it from cash flow risks caused by commodities price and exchange rate fluctuations, and as most of the derivative instruments have been designated for hedge accounting, Raízen has not experienced material gains or losses in its financial results.
See “Item 11. Quantitative and Qualitative Disclosures About Market Risk” and note 5.12 to our audited consolidated financial statements attached hereto for further information.
The following discussion of our results of operations is based on the financial information derived from our audited consolidated financial statements prepared in accordance with IFRS Accounting Standards, as issued by the IASB, unless otherwise stated. In the following discussion, references to increases or decreases in any year are made by comparison with the corresponding prior year, as applicable, except as the context otherwise indicates.
Results of Operations for the Fiscal Year Ended December 31, 2025 Compared to the Fiscal Year Ended December 31, 2024
Consolidated Results
The following table sets forth our consolidated statement of profit or loss for the fiscal years ended December 31, 2025 and 2024:
(8.0)%
(27,243.0
(30,236.1
(9.9)%
13,175.6
13,714.7
17.4%
(11.2)%
104.0%
(1,493.8
(52.7)%
Operating expenses
(2,710.4
(6,026.7
(55.0)%
36.1%
Interest in earnings of associates
219.9
1,719.0
(87.2)%
(10,885.0
(1,230.0
(7,791.4
(8,749.7
Loss before income taxes
52.4%
(34.1)%
(916.8
(1,238.3
(26.0)%
(2,203.1
(3,190.5
(30.9)%
Loss for the year from continued operations
20.8%
24.9%
Non-controlling interests
(472.3
1,262.0
(137.4)%
Net Sales
We report net sales after deducting federal and state taxes assessed on gross sales (ICMS, PIS, COFINS) and IPI (a federal value-added tax assessed on our sales in the Brazilian market at rates that vary by product). Deductions from sales in the Brazilian domestic market, which are subject to these taxes, are significantly higher than our deductions from sales in export markets.
The table below presents a breakdown of our net sales for the fiscal years ended December 31, 2025 and 2024:
North operations
11,111.8
0.1%
South operations
Container operations
794.1
685.3
15.9%
Natural gas distribution
Industrial
8,514.5
11,978.9
(28.9)%
Residential
2,667.6
2,331.3
14.4%
300.2
512.0
(41.4)%
Automotive
438.3
485.9
(9.8)%
380.5
594.5
(36.0)%
Marketing & Services
Gas commercialization
1,810.5
Finished product
8,068.8
8,794.5
(8.3)%
Base oil
743.5
630.3
18.0%
Services
507.9
823.5
(38.3)%
Lease and sale of lands
653.8
1,441.8
(54.7)%
Cosan Corporate
3.4
2.2
54.5%
Reconciliation
Segment elimination
The change in the various components consists of the following:
Rumo’s net sales decreased by R$88.6 million, or 0.6%, to R$13,847.8 million from R$13,936.4 million in the fiscal year ended December 31, 2025, compared to the year ended December 31, 2024. This performance reflects: (i) a 0.1% increase, or R$15.2 million, in net sales from Rumo’s Northern operations, driven by a 7.2% increase in transported volumes, which partially offset a 5.8% decrease in the average transportation tariff; (ii) a 9.9% decrease, or R$212.7 million, in net sales from Rumo’s Southern operations, due to a 2.4% decrease in transported volumes and an 8.5% decrease in the average transportation tariff; and (iii) a 15.9% increase, or R$108.8 million, in net sales from Rumo’s container operations, primarily reflecting higher transported volumes in higher value-added portfolios.
Compass’ net sales in the fiscal year ended December 31, 2025, amounted to R$16,604.1 million. This represented a decrease of 9.7%, or R$1,779.3 million, as compared to net sales of R$18,383.4 million in the fiscal year ended December 31, 2024. This decrease was primarily due to a R$3,853.6 million decrease in net sales at Comgás, driven by customer migration to the Free Market, which reduced Comgás’ exposure to gas sales, and was partially offset by (i) the full roll-out of operations at Edge in 2025, resulting in a R$1,587.8 million increase in net sales compared to 2024, and (ii) the recognition of net sales generated by Compagas, which was acquired at the end of the fiscal year ended December 31, 2024, and contributed to a R$533.6 million increase in net sales in 2025 compared to 2024.
Net sales for the lubricants segment were R$9,320.1 million in the fiscal year ended December 31, 2025, a decrease of R$928.3 million, or 9.1%, compared to net sales of R$10,248.4 million in the fiscal year ended December 31, 2024. This decrease primarily reflects weaker performance in the finished goods line in South and North America, which was impacted by a decrease of R$725.7 million, or 8.3%, partially offset by growth in Europe. Additionally, lower volumes and an unfavorable product mix throughout the year contributed to the overall decline, primarily as a result of the fire at the Rio de Janeiro plant.
Radar’s net sales were R$653.8 million in the fiscal year ended December 31, 2025, a decrease of R$788.0 million, or 54.7%, compared to leases and sales of land of R$1,441.8 million in the fiscal year ended December 31, 2024, primarily due to a decrease in sales of properties in 2025, with an impact of R$815.7 million on Tellus, Janus and Radar, which was partially offset by an increase of R$27.7 million in land leases.
Cost of Sales
(7,562.1
(7,533.5
0.4%
(12,573.0
(14,707.0
(14.5)%
(7,036.2
(7,310.0
(3.7)%
(82.2
(747.0
(89.0)%
Total cost of sales decreased by R$2,993.1 million, or 9.9%, to R$27,243.0 million during the fiscal year ended December 31, 2025, from R$30,236.1 million during the fiscal year ended December 31, 2024, due to the factors described below.
The cost of sales of the Rumo segment in the fiscal year ended December 31, 2025 increased by R$28.6 million, or 0.4%, to R$7,562.1 million in the fiscal year ended December 31, 2025, from R$7,533.5 million in the previous year, primarily due to (i) a decrease of R$90.0 million, or 4.0%, related to depreciation and amortization of fixed assets; (ii) a decrease of R$18.8 million, or 1.0%, in total fixed costs; and (iii) a 5.0% increase in transported volume and the corresponding increase in variable costs, which partially offset the other factors. Cost of sales accounted for 54.6% of net sales from services in the fiscal year ended December 31, 2025, as compared to 54.1% for the fiscal year ended December 31, 2024.
Compass’ cost of sales, which corresponds to the cost of gas, transportation, and construction activity on the gas distribution infrastructure under concession, totaled R$12,573.0 million in the fiscal year ended December 31, 2025, a decrease of 14.5%, or R$2,133.9 million, compared to R$14,707.0 million in the fiscal year ended December 31, 2024. This decrease was mainly due to (i) a reduction in the composition of gas purchase costs at Comgás and (ii) customer migration to the Free Market, which reduced Comgás’ exposure to gas purchase costs, together resulting in a 33.0% reduction in Comgás’ cost of sales, representing a decrease of R$4,032.3 million compared to the prior year. This effect was partially offset by the full consolidation of Edge’s results in 2025, which only affected part of the year in 2024, resulting in an increase of R$1,675.1 million in cost of sales compared to 2024, as well as the recognition of volumes and costs generated by Compagas, an entity acquired at the end of 2024, which contributed to a R$391.7 million increase in cost of sales in 2025 compared to 2024.
The cost of sales of Moove totaled R$7,036.2 million in the fiscal year ended December 31, 2025, a decrease of 3.7%, or R$273.8 million, compared to R$7,310.0 million in the fiscal year ended December 31, 2024. The reduction mainly reflects lower volumes in South and North America, partially offset by higher costs in Europe driven by foreign exchange appreciation.
The cost of sales of Radar in the fiscal year ended December 31, 2025 decreased by R$664.8 million to R$82.2 million, from R$747.0 million in the fiscal year ended December 31, 2024, mainly due to a decrease in costs incurred with the sale of real estate (farmland). In 2024, Radar sold nine properties covering 15.5 hectares for a total of R$932.6 million and, in 2025 Radar sold three properties covering 1.29 hectares for a total of R$116.9 million.
Selling expenses are primarily related to transportation costs, including freight and shipping costs for lubricant sold in Brazil and exported. Moove’s lubricant marketing expenses, as well as storage expenses, are also included as selling expenses.
(58.4
(49.0
19.2%
(231.1
(195.5
18.2%
(1,560.7
(1,331.4
17.2%
Selling expenses increased by R$274.3 million, or 17.4%, to R$1,850.2 million during the fiscal year ended December 31, 2025 from R$1,575.9 million during the fiscal year ended December 31, 2024, due to the factors described below.
Selling expenses increased by R$9.4 million, or 19.2%, to R$58.4 million in the fiscal year ended December 31, 2025 compared to R$49.0 million in the fiscal year ended December 31, 2024. This increase was mainly due to (i) an increase in employee expenses of R$1.2 million; (ii) an increase of R$4.4 million in expenses with third-party services; and (iii) an increase of R$3.7 million in expenses with marketing services.
Selling expenses increased by R$35.6 million, or 18.2%, to R$231.1 million during the fiscal year ended December 31, 2025, compared to R$195.5 million during the fiscal year ended December 31, 2024. This increase was primarily attributable to (i) a R$22.8 million increase in provisions for doubtful accounts at the consolidated level for Compass, driven by the Comgás business, which increased by R$23.3 million due to certain customers entering bankruptcy, putting pressure on the net balance; and (ii) higher employee expenses of R$4.4 million and a R$5.1 million increase in other expenses at Comgás.
Selling expenses totaled R$1,560.7 million for the year ended December 31, 2025, representing an increase of R$229.3 million, or 17.2%, compared to R$1,331.4 million for the year ended December 31, 2024. This increase was primarily driven by: (i) an increase of R$176.6 million in depreciation and amortization expenses, mainly due to the change in the amortization period of fair value adjustments recognized in North America, where expenses increased from R$171.6 million in 2024 to R$348.2 million in 2025; (ii) an increase of R$57.9 million in personnel expenses, primarily driven by higher local personnel costs and a currency effect resulting from the depreciation of the Brazilian real against the U.S. dollar in 2025 compared to 2024, considering that the average exchange rate for one U.S. dollar in Brazilian reais increased from R$5.44 in 2024 to R$5.57 in 2025; (iii) an increase of R$22.1 million in expenses with third-party services, reflecting greater commercial support and outsourced services; (iv) an increase of R$9.7 million in freight expenses, due to higher logistics expenses throughout the year; (v) a decrease of R$15.4 million in expected credit loss, driven by improved customer credit profiles and greater efficiency in collection processes throughout the period; (vi) a reduction of R$14.3 million in marketing expenses during the period, driven by optimization of investments in promotional campaigns and a greater focus on initiatives with a better return on investment; and (vii) a net decrease of R$7.4 million in other miscellaneous expenses, mainly related to minor reclassifications and exchange rate effects.
General and Administrative Expenses
(637.5
(661.7
(848.0
(818.4
3.6%
(656.0
(921.2
(28.8)%
(73.2
31.1%
General and administrative expenses include overhead costs such as salaries and third-party services across segments. Our total general and administrative expenses decreased by 11.2% to R$2,527.7 million during the fiscal year ended December 31, 2025, from R$2,845.3 million during the fiscal year ended December 31, 2024, due to the factors described below.
General and administrative expenses totaled R$637.4 million in the fiscal year ended December 31, 2025, a decrease of 3.7%, or R$24.2 million, from R$661.7 million in the fiscal year ended December 31, 2024, primarily due to (i) a decrease of R$17.1 million in employee expenses and (ii) a decrease of R$37.1 million related to third-party services, including consulting and audit services.
General and administrative expenses totaled R$848.0 million in the fiscal year ended December 31, 2025, an increase of R$29.6 million, or 3.6%, compared to R$818.4 million in the fiscal year ended December 31, 2024. This increase was mainly due to an increase of R$27.5 million in Compagas general and administrative expenses in 2025, primarily as a result of the full-year recognition of operations following the acquisition of Compagas at the end of the fiscal year ended December 31, 2024.
General and administrative expenses totaled R$656.0 million in the fiscal year ended December 31, 2025, a decrease of R$265.2 million, or 28.8%, compared to R$921.2 million in the fiscal year ended December 31, 2024, primarily due to (i) a decrease of R$227.6 million in depreciation and amortization expenses, as the amount recorded in 2024 was impacted by a specific adjustment to the estimated useful life of the customer portfolio in North America, which resulted in an impact of U.S.$23 million; starting in 2025, amortization related to the customer portfolio began to be classified under selling expenses, contributing to the reduction in general and administrative expenses; (ii) a decrease of R$77.7 million in employee expenses, mainly reflecting the share-based compensation plan recognized in 2024, which did not recur in 2025; (iii) an increase of R$28.7 million in maintenance and repairs expenses, mainly due to cleaning and corrective maintenance activities at the Rio de Janeiro plant following the incident that occurred in the first quarter of 2025; (iv) an increase of R$24.2 million in the provision for expected credit loss, reflecting higher provisioning levels during the period; and (v) a net decrease of R$12.8 million in other expenses, mainly driven by lower third-party services expenses, partially offset by other minor cost increases.
General and administrative expenses totaled R$96.0 million in the fiscal year ended December 31, 2025, an increase of R$22.8 million, or 31.1%, compared with R$73.2 million in the fiscal year ended December 31, 2024, mainly due to an increase of R$14.7 million in audit and consulting expenses, R$2.8 million in legal expenses, R$1.0 million in outsourced labor and other third-party services, R$2.0 million in expenses related to the provision for credit losses, and R$1.5 million due to an increase in corporate expense sharing.
General and administrative expenses totaled R$290.3 million in the fiscal year ended December 31, 2025, a decrease of R$80.5 million, or 21.7%, compared to R$370.8 million in the fiscal year ended December 31, 2024. This decrease was mainly due to a R$25.1 million variation in employee expenses and an increase of R$39.1 million in intercompany cost allocation and other miscellaneous expenses.
Other Operating Income, Net
Other operating income, net increased from an income of R$1,549.8 million in the fiscal year ended December 31, 2024 to an income of R$3,161.3 million in the fiscal year ended December 31, 2025, mainly due to: (1) the recognition of compensation for lost profits and property damage to fixed assets, totaling R$998.8 million, comprising R$130.3 million from Rumo S.A. and R$868.5 million from Moove; and (2) the recognition of operating income from Compass amounting to R$664.6 million, primarily arising from (i) compensation received under a contractual agreement with a supplier due to the non-utilization of the total contracted volume; and (ii) gains from the financial settlement resulting from a load optimization transaction related to certain commercial contracts, executed as part of the Company’s ordinary course commercial strategy.
Impairment expenses decreased from R$3,155.4 million in the fiscal year ended December 31, 2024 to R$1,493.8 million in the fiscal year ended December 31, 2025. The impairment effect of R$1,227.9 million at Rumo resulted from a possible failure to renew the concession of its subsidiary Rumo Malha Sul S.A. after extreme weather events in the second quarter of 2024.
Interest in Earnings of Associates
Interest in earnings of associates includes six investees of Rumo, including its 20% interest in Elevações Portuárias S.A. (“EPSA”), interests in three distributors acquired by Compass, and other investments. Interest in earnings of associates amounted to R$219.9 million as of December 31, 2025, representing a decrease of R$1,499.1 million, or 87.2%, compared to R$1,719.0 million as of December 31, 2024. This variation is primarily attributable to a reduction of R$1,542.3 million in equity income from Vale S.A.
Interest in Losses of the Joint Ventures
Interest in losses of the joint ventures totaled an expense of R$10,885.0 million in the fiscal year ended December 31, 2025, an increase of R$9,655.0 million, or 785.0%, compared to an expense of R$1,229.9 million in the fiscal year ended December 31, 2024. This variation is mainly due to the recognition of a loss from equity interest in Raízen S.A. in the amount of R$10,881.6 million for the year ended December 31, 2025, compared to a loss of R$1,218.8 million for the previous year. For more information, see Notes 2.1.11, 5.8 and 10 to our consolidated financial statements and “Item 4. Information on the Company—E. Supplemental Information About Joint Venture.”
Finance Results, Net
Finance results, net in the fiscal year ended December 31, 2025 totaled a net financial expense of R$7,791.4 million compared with a net financial expense of R$8,749.7 million in the fiscal year ended December 31, 2024, a decrease in expenses of R$958.3 million, or 11.0%.
For a better understanding of our finance results, the following table details our cost of debt:
Financial results related to loans, borrowings and debentures
Interest on debt
(6,441.8
(5,767.5
11.7%
Monetary and exchange rate variation
2,473.1
(5,795.1
(142.7)%
Derivatives and fair value measurement
(4,523.7
3,787.5
(219.4)%
Amortization of borrowing costs
(452.9
(113.1
300.4%
Discounts obtained from financial operations
186.7
Guarantees and warranties
(19.4
(36.1
(46.3)%
(8,778.0
(7,924.3
10.8%
Income from financial investments and exchange rate in Cash and Cash equivalents
2,505.3
1,975.8
26.8%
Changes in fair value of investments in listed entities
87.8
n.m
2,593.1
31.2%
(6,184.8
(5,948.4
Other charges and monetary variations
Interest on other receivables
728.1
464.9
56.6%
Interest of other financial assets
(14.9
Leases and concessions agreements
(517.5
(387.0
33.7%
Interest on leases
(647.8
(641.1
1.0%
Interest on shareholder's equity
(50.3
(44.5
Interest on contingencies and contracts
(470.3
(605.2
(22.3)%
Interest on sectorial assets and liabilities
(111.2
(88.2
26.1%
Bank charges and other
(141.9
155.6
(191.2)%
(380.8
(1,655.7
(77.0)%
(1,606.6
(2,801.3
(42.6)%
Financial results, net
(8,949.6
(7,637.1
3,583.3
2,655.9
34.9%
Exchange variation, net
2,397.4
(5,741.4
(141.8)%
Derivatives
(4,822.5
1,972.9
(344.4)%
The total cost of gross debt, which includes interest expense, foreign exchange effects, and gains or losses on derivatives, increased by R$853.7 million, or 10.8%. The increase was mainly driven by higher interest expense on debt of R$674.3 million, higher derivatives and fair value measurement expense of R$8,311.2 million, and higher amortization of borrowing costs of R$339.8 million. These increases were partially offset by a decrease in monetary and exchange rate variation of R$8,268.2 million, an increase in discounts obtained from financial operations of R$186.7 million, and a decrease in guarantees and warranties of R$16.7 million.
Income from financial investments and exchange rate in cash and cash equivalents
Income from financial investments and exchange rate in cash and cash equivalents amounted to R$2,503.3 million for the year ended December 31, 2025, representing an increase of 26.8% compared with R$1,975.8 million of income recorded for the year ended December 31, 2024. This increase was primarily driven by higher returns on financial investments, resulting from a higher cash balance arising from two primary public offerings of shares and the partial sale of the stake in Rumo, completed in November and December 2025, respectively, as well as the increase in the average SELIC interest rate and its impact on CDI rates, which reached 14.9% for the year ended December 31, 2025, compared with 11.2% for the year ended December 31, 2024.
Expense from changes in fair value of investments in listed entities amounted to R$87.8 million in the fiscal year ended December 31, 2025, and nil for the fiscal year ended December 31, 2024. This amount reflects the loss from the fair value adjustment of the market value of Vale’s shares.
Other charges and monetary variations decreased by R$1,194.7 million, or 42.6%, from an expense of R$2,801.3 million in the fiscal year ended December 31, 2024, to an expense of R$1,606.6 million in the fiscal year ended December 31, 2025. This decrease was mainly due to a decrease in foreign exchange loss of R$1,274.9 million because of the depreciation of the real relative to the U.S. dollar, to R$5.50 per U.S.$1.00 on average during the year ended December 31, 2025, compared with R$5.39 per U.S.$1.00 on average during the year ended December 31, 2024.
Total Income Taxes
Income tax expenses amounted to an expense of R$2,203.1 million for the fiscal year ended December 31, 2025, compared with an expense of R$3,190.5 million in the fiscal year ended December 31, 2024. This variation was primarily due to provisions for the potential non-realization of income tax and social contribution deferred on tax losses and a negative CSLL base in the amount of R$1,831.4 million. This provision was recognized because, under current conditions, there is no sufficient evidence that supports the future generation of taxable income to offset the accumulated tax losses. As a result, our effective tax rate for the year ended December 31, 2025, was 27.57% on a tax loss of R$7,991.3 million, which was lower than the nominal corporate tax rate of 34.0%.
As a result of the foregoing, the loss for the year increased from a loss of R$8,161.8 million to a loss of R$10,194.4 million for the fiscal year ended December 31, 2025, primarily due to interest in earnings of the joint venture. This represented a reduction of R$298.3 million after deducting the loss attributable to non-controlling interests of R$472.3 million and R$1,262.0 million for the fiscal years ended December 31, 2025 and 2024, respectively.
Results of Operations for the Fiscal Year Ended December 31, 2024 Compared to the Fiscal Year Ended December 31, 2023
The following table sets forth our consolidated statement of profit or loss for the fiscal years ended December 31, 2024 and 2023:
11.4%
(28,549.9
5.9%
10,918.6
25.6%
16.7%
12.6%
(60.5)%
Operating (expenses) profit
45.8
(29.9)%
350.4
390.6%
Interest in (losses) earnings of joint ventures
1,695.9
(172.5)%
(7,897.0
(202.6)%
18.7%
1,370.6
(190.3)%
(274.4
(Loss) profit for the year from continued operations
(274.3)%
(267.1)%
Owners of the Company
(9,423.8
1,094.4
3,790.4
(66.7)%
The table below presents a breakdown of our net sales for the fiscal years ended December 31, 2024 and 2023:
North Operations
33.0%
South Operations
6.0%
558.7
22.7%
11,411.2
5.0%
2,202.3
710.3
(27.9)%
592.9
(18.0)%
535.7
11.0%
3.5%
8,520.3
3.2%
765.4
(17.7)%
793.0
3.8%
743.4
93.9%
2.7
(18.5)%
Rumo’s net sales increased by R$2,998.7 million, or 27.4%, to R$13,936.4 million from R$10,937.7 million in the fiscal year ended December 31, 2024 compared to the year ended December 31, 2023, primarily due to (i) an increase in the net sales of Rumo’s northern operations of 33%, or R$2,750.3 million, compared to the previous year driven by a 5% increase in volumes transported and an increase in the average transportation tariff, (ii) an increase in the net sales of Rumo’s southern operations of 6% or R$121.8 million, mainly due to the increase in the average transportation tariff, and (iii) an increase in net sales in Rumo’s container operations of 22.7%, or R$126.6 million, mainly due to the growth in the volume transported in higher value-added portfolios.
Compass’ net sales in the fiscal year ended December 31, 2024 amounted to R$18.383.4 million. This represented an increase of 3.5%, or R$616.1 million, as compared to net sales of R$17,767.3 million in the fiscal year ended December 31, 2023. This increase was primarily due to (i) the acquisition and consolidation of the results of Compagas beginning in September 2024, which increased net sales by R$314.3 million; and (ii) a R$284.5 million increase in net sales at Comgás, which, in turn, was caused by an increase in the volume of distributed natural gas and (iii) other factors such as the recovery of volumes in the distribution segment, the readjustment of tariffs for inflation and the start of Edge’s operations, which include the TRSP (São Paulo Regasification Terminal located in Santos) and new contracts with open market customers.
The net revenue of the lubricants business was R$10,248.4 million in the fiscal year ended December 31, 2024, an increase of R$169.8 million, or 1.7%, compared to net revenue of R$10,078.6 million in the fiscal year ended December 31, 2023, This increase is mainly attributed to the implementation and evolution of the Moove Performance System, with a focus on revenue management strategy, improving the product mix sold, and supply management, to optimize costs.
Leases and sales of land amounted to R$1,441.8 million in the fiscal year ended December 31, 2024, an increase of R$698.4 million, or 93.9%, compared to leases and sales of land of R$743.4 million in the fiscal year ended December 31, 2023, primarily due to an increase in sales of nine properties in 2024 with an impact of R$729.9 million on Tellus, Janus and Radar, which was partially offset by a decrease of R$31.5 million in land leases.
(6,838.4
10.2%
(14,256.0
(7,359.6
(0.7)%
(153.5
386.6%
(3.6
(100)%
Total cost of sales increased by R$1,686.2 million, or 5.9%, to R$30,236.1 million during the fiscal year ended December 31, 2024, from R$28,549.8 million during the fiscal year ended December 31, 2023, due to the factors described below.
The cost of sales of the Rumo segment in the fiscal year ended December 31, 2024 increased by R$695.1 million, or 10.2%, to R$7,533.5 million in the fiscal year ended December 31, 2023, from R$6,838.4 million in the previous year, which was primarily due to (i) a 3.3% increase in transported volume; (ii) an increase of R$130.1 million due to depreciation and amortization related to the acquisition of fixed assets; (iii) an increase of R$89.7 million in maintenance expenses for the railroad track; and (iv) an increase of R$ 374 million in transportation and transshipment costs. Cost of sales accounted for 54.1% of net sales from services in the fiscal year ended December 31, 2024 as compared to 62.5% for the fiscal year ended December 31, 2023.
Compass’ costs of sales, which corresponds to the cost of gas, transportation, construction activity on the gas distribution infrastructure under concession, totaled R$14,707.0 million in the fiscal year ended December 31, 2024, an increase of 3.2%, or R$451.0 million, in comparison with R$14,256.0 million in the fiscal year ended December 31, 2023. This increase was primarily due to (i) a 3.6% increase in the volume of natural gas distributed, which resulted in a R$195.8 million increase in Comgás’ cost of sales, and (ii) the acquisition and consolidation of the results of Compagas beginning in September 2024, which increased costs of sales by R$265.9 million.
The cost of sales of Moove totaled R$7,310.0 million in the fiscal year ended December 31, 2024, a decrease of 0.7%, or R$49.6 million, compared to R$7,359.6 million in the fiscal year ended December 31, 2023, mainly due to the execution of Moove’s commercial strategy and efficient supply management.
The cost of sales of Radar in the fiscal year ended December 31, 2024 increased by R$593.5 million to R$747.0 million, from R$153.5 million in the fiscal year ended December 31, 2023, mainly due to an increase in costs incurred with the sale of real estate (farm land). In 2024, Radar sold nine properties covering 15.5 million hectares for a total of R$932.6 million.
Cosan Corporate cost of sales were nil in the fiscal year ended December 31, 2024, a decrease of R$3.6 million, compared to R$3.6 million in the fiscal year ended December 31, 2023. This decrease was mainly due to our sale of Trizy in March 2023.
(40.7
20.4%
(164.4
18.9%
(1,145.0
16.3%
Selling expenses increased by R$225.3 million, or 16.7%, to R$1,575.9 million during the fiscal year ended December 31, 2024 from R$1,350.6 million during the fiscal year ended December 31, 2023, due to the factors described below.
Selling expenses increased by R$8.3 million, or 20.4%, to R$49.0 million in the fiscal year ended December 31, 2024 compared to R$40.7 million in the fiscal year ended December 31, 2023. This increase was mainly due to (i) an increase in employee expenses of R$5.1 million (ii) an increase of R$1.9 million in expenses with third-party services and (iii) an increase of R$1.8 million in expenses with marketing services.
Selling expenses increased by R$31.1 million, or 18.9%, to R$195.5 million during the fiscal year ended December 31, 2024, from an expense of R$164.4 million during the fiscal year ended December 31, 2023. This increase was mainly due to (1) an increase of R$17.2 million in provisions for doubtful accounts, and (2) an increase of R$12.6 million in employee expenses.
Selling expenses increased by R$186.4 million, or 16.3%, to R$1,331.4 million in the fiscal year ended December 31, 2024, as compared to R$1,145.0 million in the fiscal year ended December 31, 2023. This increase was mainly due to (1) an increase of R$83.0 million with employee expenses; (2) an increase of R$31.6 million in depreciation and amortization expenses related to the acquisition of fixed assets; (3) an increase of R$18.4 million in provisions for doubtful accounts; and (4) an increase of R$15.0 million related to marketing expenses.
(560.0
(788.0
3.9%
(645.6
42.7%
(74.3
(1.5)%
General and administrative expenses include overhead costs like salaries and third-party services across segments. Our total general and administrative expenses increased by 12.6% to R$2,845.3 million during the fiscal year ended December 31, 2024, from R$2,527.9 million during the fiscal year ended December 31, 2023, due to the factors described below.
General and administrative expenses totaled R$661.7 million in the fiscal year ended December 31, 2024, an increase of 18.2%, or R$101.7 million, from R$560.0 million in the fiscal year ended December 31, 2023, primarily due to increases of (i) R$60.4 million in employee expenses, (ii) an increase of R$29.6 million related to third-party services, including consulting and audit services, and (iii) an increase of R$5.9 million in expenses relating to travel, accommodation and mileage.
General and administrative expenses totaled R$818.4 million in the fiscal year ended December 31, 2024, an increase of R$30.4 million, or 3.9%, compared to R$788.0 million in the fiscal year ended December 31, 2023. This increase was mainly due to: (i) an increase of R$17.4 million in employee expenses; and (ii) the acquisition and consolidation of the results of Compagas beginning in September 2024 which resulted in an increase in general administrative expenses of R$12.7 million.
General and administrative expenses totaled R$921.2 million in the fiscal year ended December 31, 2024, an increase of R$275.6 million, or 42.7% when compared to the expense of R$645.6 million in the fiscal year ended December 31, 2023, primarily due to (i) an increase of R$175.3 million in depreciation and amortization expenses related to the acquisition of fixed assets and due to the acceleration of goodwill amortization in North America; (ii) an increase of R$85.4 million related to third-party services, including consulting and audit services; and (iii) an increase of R$51.3 million in employee expenses. This increase was partially offset by a decrease of R$60.1 million in provisions for doubtful accounts.
General and administrative expenses totaled R$73.2 million in the fiscal year ended December 31, 2024, a decrease of R$1.1 million, or 1.5% when compared to expenses of R$74.3 million in the fiscal year ended December 31, 2023, mainly due to a decrease of R$0.7 million in audit and consulting expenses.
General and administrative expenses totaled R$370.8 million in the fiscal year ended December 31, 2024, a decrease of R$89.2 million, or 19.4% when compared to the expense of R$460.0 million in the fiscal year ended December 31, 2023. This decrease was mainly due to a decrease of R$79.4 million in employee expenses and other miscellaneous expenses.
Other Income, Net
Other income, net decreased from an income of R$3,924.4 million in the fiscal year ended December 31, 2023 to an expense of R$1,549.8 million in the fiscal year ended December 31, 2024, mainly due to: (1) a decrease of R$2,374.5 million reflecting changes in the fair value of investment properties (the methodology used to determine fair value incorporates direct comparisons of market information, such as market research, spot market prices, sales, distances, facilities, access to land, topography and soil, land use (crop type), and rainfall, among other data, in accordance with the standards issued by the Brazilian Association of Technical Standards (Associação Brasileira de Normas Técnicas – ABNT); (2) the recognition of dividends declared by Vale in the amount of R$1,339.4 million in 2023; (3) the recognition of other operating income received in the amount of R$923.2 million from our subsidiary Edge Comercialização, related to the cancellation of liquefied natural gas contracts scheduled for 2023, (4) net effect of the sale of a stake in Vale in the amount R$383.2 million; and (5) the impairment effect of R$3,155.4 million resulting from extreme weather events in the second quarter of 2024, which damaged railway infrastructure of Rumo Malha Sul S.A. (see also note 11 to our audited consolidated financial statements included elsewhere in this annual report). This decrease was partially offset by: (1) a commercial agreement with suppliers of Compass in the amount R$833.0 million and (2) a reversal of R$291.0 million resulting from a reassessment by Comgás of the probability of certain outflows of resources for part of the amount previously recorded under “Other liabilities.”
The impairment effect of R$3,155.4 million at Rumo resulting from extreme weather events in the second quarter of 2024 includes a provision for the write-off of the residual value of assets where traffic directly interrupted by extreme weather events in Rio Grande do Sul, in the amount of R$182.0 million, an impairment affecting the subsidiary Rumo Malha Sul S.A., and the impairment value of the indirect subsidiary Rota 4 Participações S.A. in the amount of R$6.1 million.
Interest in earnings of associates includes our 20% of interest in EPSA, interest in eight distributors acquired by Compass and other investments. Interest in earnings of associates was R$1,719.0 million on December 31, 2024, an increase of R$1,368.6 million or 390.6% compared to December 31, 2023 of R$350.4 million. This variation is mainly due to an increase of R$1,428.3 million in equity income from Vale S.A.
Interest in Earnings of the Joint Venture
Interest in earnings of the joint venture includes our 30.8% interests in Raízen S.A. Interest in earnings of the joint venture decreased to an expense of R$1,229.9 million in the fiscal year ended December 31, 2024, representing a decrease of R$4,155.7 million, from an income of R$1,695.9 million in the fiscal year ended December 31, 2023, mainly due to the recognition of PIS and COFINS tax credits in an amount of R$1,824.0 million in connection with Supplementary Laws Nos. 192 and 194 (which reduced the rates of PIS and COFINS applicable to certain products). For more information see “Item 4. Information on the Company—E. Supplemental Information About Joint Venture.”
Finance results, net in the fiscal year ended December 31, 2024 totaled a net financial expense of R$8,749.7 million compared with a net financial expense of R$7,897.1 million in the fiscal year ended December 31, 2023, an increase of R$852.7 million, or 10.8%.
(4,267.8
35.1%
1,921.6
(401.6)%
(2,684.1
(241.1)%
(64.6
75.1%
(5,133.7
54.4%
2,057.4
(4.0)%
Changes in fair value of investment in listed entities
Cost of debt, net
450.5
Update of other financial assets
1.8
Monetary variation of other financial assets
(514.2
(24.7)%
Interest on lease liabilities
(444.9
44.1%
Interest on shareholders’ equity
(46.2
(781.1
(22.5)%
Interest on sectoral assets and liabilities
(97.9
(155.6
(107.8
(44.3)%
(11,337.4
32.6%
3,028.1
12.3%
Foreign exchange losses, net
1,777.4
(423.0)%
The total cost of gross debt (which includes interest expenses, exchange rate variations and gains or losses on derivatives) increased by R$2,790.6 million, or 54.4%. This increase was mainly due to (1) an increase in the debt interest line of R$1,499.7 million due to the higher balance of loans and financing resulting from the issuances made in the period, which increased our total debt, (2) an increase of R$7,716.7 million in the monetary and exchange variation line due to the devaluation of the Brazilian real against the U.S. dollar, to R$5.39 per U.S.$1.00 on average during the year ended December 31, 2024 compared to R$5.00 per U.S.$1.00 on average during the year ended December 31, 2023, and (3) a decrease of R$6,471.6 million in the derivatives and fair value measurement line.
Income from financial investments and exchange rate in cash and cash equivalents amounted to R$1,975.8 million in the fiscal year ended December 31, 2024, a decrease of 4.0% as compared to interest income of R$2,057.4 million in the fiscal year ended December 31, 2023. This decrease was mainly due to the reduction of the average SELIC interest rate and the resulting effect over CDI rates, which decreased to 11.15% for the year ended December 31, 2024 from 11.65% for the year ended December 31, 2023.
Financial investment on listed entities
Expense from financial investment on listed entities amounted to nil in the fiscal year ended December 31, 2024 and R$3,147.0 million on December 31, 2023. This amount is related to the loss from the adjustment at fair value based on the market value of Vale’s shares, which became an investment in associates in November 2023.
Other charges and monetary variations increased by R$1,127.6 million, or 67.4%, from an expense of R$1,673.7 million in the fiscal year ended December 31, 2023, to an expense of R$2,801.3 million in the fiscal year ended December 31, 2024. This increase was due to a foreign exchange loss in the amount of R$1,521.7 million due to an effect of the depreciation of the Brazilian real relative to the U.S. dollar, to R$5.39 per U.S.$1.00 on average during the year ended December 31, 2024 in comparison to R$5.00 per U.S.$1.00 on average during the year ended December 31, 2023. This increase was partially offset by (1) a decrease of R$175.9 million in interest on contingencies and contracts, and (2) a decrease of R$304.8 million in interest on lease liabilities.
Income tax expenses amounted to an expense of R$3,190.5 million for the fiscal year ended December 31, 2024, compared to an expense of R$274.4 million in the fiscal year ended December 31, 2023. This variation was primarily due to provisions for potential non-realization of income tax and social contribution, deferred on tax losses and negative CSLL base in the amount of R$ 2,884.0 million. This provision was recognized because, under current conditions, there is no convincing evidence that supports the future generation of sufficient taxable income to offset the accumulated tax losses. As a result, our effective tax rate for the year ended December 31, 2024 was 60.8% on a taxable income of R$5,245.1 million, which was higher than the nominal corporate tax rate of 34%.
Profit Attributable to Owners of the Company
As a result of the foregoing, the profit attributable to the Company’s shareholders decreased from a profit of R$1,094.4 million to a loss of R$9,423.8 million for the fiscal year ended December 31, 2024, primarily due to impairments and exchange losses during the period. This represented a reduction after deducting the profit attributable to non-controlling shareholders of R$1,262.0 million and R$3,790.4 million for the fiscal years ended December 31, 2024, and December 31, 2023, respectively.
Our financial condition and liquidity are influenced by several factors, including:
Our cash needs have traditionally consisted of working capital requirements, servicing of our indebtedness, capital expenditures related to investments in operations, maintenance and expansion of plant facilities, as well as acquisitions. Our sources of liquidity have traditionally consisted of cash flows from our operations and short- and long-term borrowings. We have financed acquisitions through seller financing, third-party financing or capital contributions by our shareholders. We believe our current working capital is sufficient for our present requirements and would expect to meet any potential shortfalls in our working capital needs through short- and long-term borrowings, capital contributions by our shareholders, or offerings of debt or equity securities in the domestic and international capital markets.
In the fiscal years ended December 31, 2025, 2024 and 2023, the cash flow used in investing activities was funded mainly by increased borrowing and also by the operational cash flows of our subsidiaries. As of December 31, 2025, our consolidated cash and cash equivalents (including marketable securities – current and non-current) amounted to R$30,236.3 million, compared to R$20,289.8 million as of December 31, 2024 and R$18,162.5 million as of December 31, 2023.
On December 31, 2025, Cosan S.A. had positive consolidated working capital (total current assets less total current liabilities) of R$24,539.3 million and a loss for the year of R$10,194.4 million.
Cash Flows
The following table sets forth certain of our cash flow data for the periods indicated:
Net Cash generated from operating activities
Net Cash used in investing activities
Net Cash used in financing activities
The R$10,598.8 million increase in cash and cash equivalents during 2025 was primarily attributable to: (i) net proceeds of R$10,280.2 million from the two primary public offerings of common shares completed in November 2025, conducted to materially deleverage the Company's capital structure; and (ii) continued strong operating cash generation of R$13,026.8 million, partly offset by principal debt repayments of R$14,294.0 million and dividend payments of R$2,693.3 million. The Company used a portion of the offering proceeds to redeem the senior notes due 2027, 2029 and 2030 and prepay certain debentures in the liability management transactions executed during the year.
Net Cash Generated from Operating Activities
Net cash generated from operating activities was R$13,026.8 million in the fiscal year ended December 31, 2025, compared to R$13,081.3 million in the fiscal year ended December 31, 2024, representing a decrease of R$54.5 million, or 0.4%. This near‑flat movement indicates that the business continued to convert earnings into cash at a broadly similar level despite lower consolidated revenue and a weaker reported net income in the consolidated income statement for 2025. The operating cash base was supported by the scale of the consolidated business and by the impact of non‑cash and mostly non‑operating items embedded in losses. Net sales declined to R$40,418.6 million from R$43,950.7 million, while gross profit remained resilient at R$13,175.6 million, compared to R$13,714.7 million, suggesting that the core operating model still generated substantial cash even in a lower‑revenue environment. During the year, the business recorded material non‑cash and non‑operating items, including R$10,665.1 million in interest in losses of associates and joint ventures, an impairment charge of R$1,493.8 million, and a foreign exchange gain of R$2,397.4 million, all of which help explain why accounting results did not move in lockstep with cash generation. Working capital movements also muted the year‑over‑year change in operating cash. Consolidated trade receivables declined to R$3,520.3 million from R$3,730.4 million, inventories fell to R$1,969.3 million from R$2,072.9 million, and trade payables decreased to R$4,078.5 million from R$5,168.6 million, while other liabilities and tax balances were also lower in several lines. On balance, these movements indicate that cash released from reduced receivables and inventories was largely offset by lower supplier financing and other operating liabilities, which helps explain why operating cash remained essentially flat despite lower revenue. The net cash flow generated from operating activities in 2025 was primarily affected by: (i) an increase of R$9,655.0 million in interest in losses of joint ventures, mainly driven by the results of Raízen S.A.; (ii) a decrease of R$6,334.0 million in the impairment and impairment in associate lines, mainly attributable to the impairment recognized in 2024 related to Vale S.A.; and (iii) revenue from insurance indemnities of R$940.6 million, mainly attributable to Rumo and Moove.
The net cash flows generated from operating activities in the fiscal year ended December 31, 2024 amounted to R$13,081.3 million, compared to R$10,276.4 million in the fiscal year ended December 31, 2023, representing an increase of R$2,755.9 million, which was primarily attributable to (i) an increase of R$2,128.0 million due to Rumo’s higher volumes and margins in transportation revenues during the period, (ii) an increase of R$564.7 million driven by, at Compass, the recovery of volumes in the distribution segment, the adjustment of tariffs for inflation, and the commencement of Edge’s operations, which include the TRSP (São Paulo Regasification Terminal located in Santos) and new contracts with open market customers, and (iii) at Moove, an improvement in margins driven by portfolio management and an improvement in the product mix.
Net Cash Used in Investing Activities
Net cash used in investing activities amounted to R$76.1 million in the fiscal year ended December 31, 2025, compared to net cash used in investing activities of R$4,488.3 million in the fiscal year ended December 31, 2024. This represents a decrease of R$4,412.2 million, primarily driven by (i) proceeds from the sale of investments of R$8,945.3 million in the year ended December 31, 2025, compared with R$2,725.6 million in the year ended December 31, 2024, reflecting an increase of R$6,219.7 million, or 228.2%, mainly due to the sale of our ownership interest in Vale S.A.; (ii) acquisitions of property, plant and equipment, and intangible and contract assets totaling R$8,459.9 million in the year ended December 31, 2025, compared with R$7,834.5 million in the year ended December 31, 2024, an increase of R$625.3 million, or 8.0%, primarily reflecting ongoing construction in the Rumo and Compass segments; (iii) dividends received from subsidiaries and associates and from joint ventures amounting to R$153.1 million in the year ended December 31, 2025, compared with R$1,312.7 million in the year ended December 31, 2024, representing a decrease of R$1,159.6 million; (iv) a R$703.1 million increase in payments of derivative financial instruments (excluding debt‑related instruments), from R$427.3 million in the year ended December 31, 2024 to R$1,130.4 million in the year ended December 31, 2025; (v) a decrease of R$346.7 million in costs associated with acquisitions of subsidiaries; and (vi) an increase of R$437.9 million in the sale of marketable securities, net.
Net cash flows used in investing activities amounted to R$4,488.3 million in the fiscal year ended December 31, 2024, compared to net cash flows used in investing activities of R$4,303.1 million in the fiscal year ended December 31, 2023, representing an increase of R$185.2 million, which was primarily attributable to (i) the acquisition of property, plant and equipment, intangible assets and contract assets in the amount of R$7,834.5 million in year ended December 31, 2024 compared to R$6,268.0 million for the year ended December 31, 2023, representing a R$1,566.6 million, or 25.0%, increase, mainly due to ongoing construction in the Rumo and Compass segments, (ii) the absence of dividends declared by Vale S.A. in the year ended December 31, 2024, as compared to R$1,305.4 million for the year ended December 31, 2023, representing a decrease of R$1,305.4 million, (iii) costs associated with acquisitions in the period, net of acquired cash, in the amount of R$259.8 million, and (iv) a R$270.7 million increase in payments relating to derivative financial instruments, from R$156.6 million for the year ended December 31, 2023 to R$427.3 million in the year ended December 31, 2024. These effects were partially offset by (i) an increase of R$2,079.9 million in the receipt of proceeds from the sale of investments, from R$645.8 million in the year ended December 31, 2023 to R$2,725.6 million in the year ended December 31, 2024, mainly driven by Compass, which sold its entire 51% stake in Norgás for R$911 million, and by Cosan, with the sale of a 0.78% stake in Vale by Cosan for R$383 million, and (ii) an increase of R$1,059.0 million in sale of marketable securities, from R$508.0 million in the year ended December 31, 2023 to R$551.0 million in the year ended December 31, 2024.
Net Cash Used in Financing Activities
Net cash used in financing activities was R$2,351.9 million in the fiscal year ended December 31, 2025, compared to net cash flows used in financing activities of R$6,605.9 million in the fiscal year ended December 31, 2024. This represents a decrease of R$4,254.0 million, primarily due to (i) recognition of the acquisition of non‑controlling interests held by shareholders in the amount of R$5,746.8 million; (ii) recognition of a capital increase of R$9,782.2 million; (iii) recognition of cash of R$2,792.9 million received from financing secured by shares, in connection with the sale of the equivalent of a 9.94% interest in Rumo; (iv) recognition of cash of R$4,000.0 million received from the issuance of preferred shares of a subsidiary, related to the acquisition of Cosan Dez preferred shares; (v) a decrease of R$5,436.7 million in proceeds from loans, borrowings and debentures compared with the prior year; (vi) dividends paid of R$1,698.7 million, a decrease of R$1,080.4 million compared with the prior year, mainly reflecting the amount of R$2,779.1 million paid in the prior year; and (vii) principal repayments of loans, borrowings and debentures of R$14,294.0 million, an increase of R$2,106.4 million compared with the prior year.
Net cash flows used in financing activities were R$6,605.9 million in the fiscal year ended December 31, 2024, compared to net cash flows generated in financing activities of R$4,516.6 million in the fiscal year ended December 31, 2023, representing an increase of R$2,089.3 million, which was primarily attributable to (i) an increase of R$1,207.6 million in payments of interest on financings and debentures compared to the prior year, driven mainly by settlements and advances in an amount of R$2,468.1 million by Cosan Corporate in the year ended December 31, 2024, (ii) dividends paid in the amount of R$3,447.1 million, an increase of R$865 million compared to the prior year impacted mainly by the amount of R$668 million paid to preferred shareholders of Cosan Nove and Cosan Dez and R$3,125.3 million in dividends paid to Compass shareholders, and (iii) amortization of the principal amount on leases of R$694.3 million, an increase of R$204 million compared to the prior year, generated mainly by the new contracts and contractual adjustments made by Rumo in the amount of R$513 million.
Indebtedness
As of December 31, 2025, our outstanding debt (comprising current and non‑current loans, borrowings and debentures) totaled R$64,227.1 million, of which R$3,918.7 million was current debt. Our debt consisted of R$48,278.0 million in local currency‑denominated debt and R$15,949.1 million in foreign currency‑denominated debt. Our total debt of R$64,227.1 million as of December 31, 2025 decreased by 3.4% compared with our total debt of R$66,455.4 million as of December 31, 2024, mainly due to our partial repurchase of the fifth and sixth series of debentures, as well as senior notes issued by Cosan Luxembourg S.A. (“Cosan Lux”) maturing in 2027, 2029, 2030, and 2031.
As of December 31, 2025, our debt denominated in U.S. dollars, euros, and pounds sterling represented 28.3% of our total debt (current and non-current loans, borrowings and debentures). Debt denominated in U.S. dollars represented 27.86%, debt denominated in euros represented 0.03%, and debt denominated in pounds sterling represented 0.4% of our total debt. Our secured debt as of December 31, 2025 represented 10.8% of our total debt, primarily in the form of mortgages on land and assignment or pledge of receivables, machinery, and equipment.
Certain of our long term debt agreements require us or certain of our subsidiaries to comply with financial covenants, including on our U.S.$600.0 million 7.250% senior notes due 2031, our U.S.$550.0 million 7.500% senior notes due 2030, our U.S.$740.8 million 5.500% senior notes due 2029, Rumo’s U.S.$500.0 million 5.250% senior notes due 2028, Rumo’s U.S.$500.0 million 4.200% sustainability linked notes due 2032, and our U.S.$200.0 million and U.S.$300.0 million 8.25% perpetual notes. These covenants, among other things, limit the ability of our subsidiaries to enter into certain transactions with shareholders or affiliates, make certain restricted payments (including, in certain cases, dividends), engage in mergers, sales, or consolidations, and create liens.
We and our subsidiaries are subject to certain restrictive financial covenants set forth in existing loans and financing agreements. As of December 31, 2025 and the date of this annual report, we and our subsidiaries remain in compliance with our debt covenants.
The principal financing activities undertaken by Cosan and its subsidiaries for the fiscal year ended December 31, 2025 are described below:
Segment/Type
Date
Incidence of interest
Index
Objective
Funding cost
Value (R$ million)
Maturity
Debentures
3/12/2025
Yearly
CDI + 0.60% p.a.
Capital management
(46.6
1,500.0
1/27/2029
CDI + 0.70% p.a.
(13.8
500.0
3/27/2030
CDI + 1.00% p.a.
(13.7
3/27/2032
1/10/2025
DI + spread 0.50% p.a.
Investment
410.0
1/7/2027
2/18/2025
Six-monthly
IPCA + 7.44% p.a.
(18.5
800.0
1/15/2033
Loan 4.131
3/20/2025
CDI + 0.78% p.a.
(0.9
350.0
3/20/2026
Institutional Debentures
5/19/2025
CDI + 0.45% p.a.
(2.4
5/15/2028
Debentures 12,431
10/9/2025
IPCA + 6.80%
(12.0
300.0
9/15/2037
IPCA + 6.58%
(32.2
700.0
9/15/2040
11/17/2025
CDI + 0.45%
(0.5
200.0
11/15/2029
Commercial Note private
11/26/2025
Settlement
CDI + 1.20%
53.9
3/31/2026
BNDES
12/17/2025
Monthly
IPCA + 9.00%
(1.4
26.7
9/16/2041
Fixed rate
(0.1
215.8
3/28/2025
IPCA + 7.47% p.a.
(17.0
434.9
3/28/2037
IPCA + 7.53% p.a.
(64.0
1,365.1
3/28/2040
9/29/2025
IPCA + 6.58% p.a.
1,000.0
10/15/2040
12/16/2025
IPCA + 7.40% p.a.
(12.2
750.0
12/15/2040
BNDES (Finem)
12/18/2025
IPCA + 8.81% p.a.
(1.7
27.0
9/15/2035
TR + 2.81% p.a.
1/16/2025
CDI + 0.50% p.a.
1/18/2028
Export credit notes
12/19/2025
USD + 4.52% p.a.
275.7
12/17/2027
The principal financing activities undertaken by us, our subsidiaries, and our joint ventures for the fiscal year ended December 31, 2025 are described below.
The table below shows the profile of our debt instruments as of the dates indicated:
CDI + 1.28%
16.37%
11,548.9
10,554.3
IPCA + 5.75%
10.27%
452.8
433.5
Commercial bank notes
CDI + 1.77%
16.94%
1,028.6
1,020.0
Perpetual Notes
8.25%
2,785.9
3,135.2
Senior Notes
6.48%
5,924.6
14,181.6
21,740.9
29,324.6
IPCA + 4.69%
9.16%
2,794.4
3,034.7
7.89%
216.4
CDI + 0.74%
15.54%
5,551.1
5,378.9
VC + 4.04%
4.04%
828.6
2,695.6
CDI + 0.78%
15.80%
392.1
Private business Note
16.28%
54.7
Debentures (Law 12.431)
IPCA + 6.42%
10.96%
5,102.7
2,956.9
IGPM + 6.10%
6.10%
380.8
382.8
15,320.8
14,449.0
Offshore loan 4.131
5.50%
15.7
CDI + 0.50%
14.89%
571.2
Acquisition Finance
SOFR + 1.50%
5.74%
2,104.1
2,346.9
Working capital
SONIA + 1.30%
5.52%
259.9
272.3
Export Credit Note
SOFR + 1.30%
5.54%
282.5
316.4
4.52%
274.3
Export Prepayment
SOFR + 1.40%
5.64%
4,041.6
3,558.6
ACF
IPCA + 6.48%
11.03%
494.2
299.7
URTJLP + 2.06%
11.21%
1,428.1
1,861.6
IPCA
4.12%
27.1
TR
1.21%
CCB (Bank Credit Certificate)
IPCA + 0.94%
5.25%
814.4
874.5
CDI + 0.70%
15.70%
261.2
IPCA + 5.71%
10.23%
14,906.5
10,722.2
Export Credit Agency (“ECA”)
Euribor + 0,58%
2.69%
19.5
38.5
NCE
276.7
4.73%
23,123.8
19,123.2
Non-current
In addition, the principal financing activities undertaken by us, our subsidiaries, and our joint ventures during 2026 through the date of this annual report are described below:
Unused Sources of Liquidity
As of December 31, 2025 and December 31, 2024, we and our subsidiaries had unused available credit lines in the amount of R$1,133.3 million and R$1,510.2 million, respectively. The use of these credit lines is subject to certain contractual conditions.
Working Capital
As of December 31, 2025, we had working capital (total current assets less total current liabilities) of R$24,539.3 million, compared to R$12,861.6 million as of December 31, 2024. The difference between the position as of December 31, 2025 and December 31, 2024 was mainly attributable to an increase in cash and cash equivalents.
Our capital expenditures, which consist of acquisitions of property, plant and equipment, intangible and contract assets, were R$8,459.9 million during the fiscal year ended December 31, 2025, compared to R$7,834.5 million during the fiscal year ended December 31, 2024. For the fiscal year ended December 31, 2023, our capital expenditures were R$6,268.0 million.
In 2025, 2024, and 2023, our capital expenditures consisted primarily of the following:
The following table sets forth our capital expenditures for the fiscal years ended December 31, 2025, 2024 and 2023:
6,096.3
5,492.7
3,689.9
2,197.1
2,135.9
2,317.9
146.1
186.0
178.0
10.4
6.4
39.9
Total consolidated capital expenditures (1)
The main planned and undergoing projects related to capital expenditures are described in “Item 4. Information on the Company—D. Property, Plant and Equipment.” We expect to fund such planned and undergoing projects primarily through our and our subsidiaries’ working capital and existing or new indebtedness.
Contractual Financial Obligations
The following table sets forth the maturity schedule of our material contractual financial obligations (contracted undiscounted cash flows basis) as of December 31, 2025:
Loans, borrowings and debentures (1)
(7,374.4
(9,749.0
(43,246.2
(58,220.3
(118,589.9
Trade payables
(4,078.5
(19.0
(4,097.5
Other financial liabilities
(1,096.9
Installments of tax debts
(15.0
(10.4
(2.0
(228.3
(255.7
Leases
(1,099.6
(1,078.8
(1,292.2
(20,529.6
(24,000.3
Lease and concession installments
(233.6
(229.9
(454.1
(188.5
(1,106.1
Related parties payables
(320.9
(1.2
(322.1
Dividends payable
(226.5
Consideration payable
(9.6
(31.1
(105.0
(155.3
Derivative financial instruments
(3,019.4
(1,221.6
(979.7
13,021.6
7,800.8
Sectorial financial liabilities
(96.7
Put option liability on subsidiary shares
(4,000.0
Liability from financing secured by shares
Since December 31, 2025, there have been no material changes to the contractual obligations described above.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements to finance our operations. We have no subsidiaries in which we hold a majority or minority stake that are not included in our consolidated financial statements, nor do we have any interests in or relationships with any special purpose companies that are not reflected in our consolidated financial statements.
However, we have entered, in the normal course of business, into several types of off-balance sheet arrangements, as set forth below:
Acquisition of Assets – Tariff Review
Following the postponement of the 2014 Five-Year Tariff Review 2014 as a result of the publications of ARSESP Resolutions No. 493 and No. 494, both of which were published on May 27, 2014, which approved the “Tariff Review Process of Gas distribution companies in the State of São Paulo, defining event schedule,” and the “Provisional adjustment of marketing margins of Companhia de Gás de São Paulo — COMGÁS,” we are not subject to any set regulatory commitment to purchase assets as of December 31, 2025, 2024 and 2023.
See “Item 4. Information on the Company—B. Business Overview—Patents, Licenses, Contracts and Processes” and “Item 4. Information on the Company—B. Business Overview—Research and Development.”
The following list sets forth, in our view, the most important trends, uncertainties and events that are reasonably likely to continue to have a material effect on our revenues, income from continuing operations, profitability, liquidity and capital resources, or that may cause reported financial information to be not necessarily indicative of future operating results or financial condition:
For further information, see “Item 3. Key Information—D. Risk Factors,” where we present the risks we face in our business that may affect our commercial activities, operating results or liquidity.
Our financial statements are presented in IFRS as issued by the IASB. For summary information about critical judgments, assumptions, and estimation uncertainties in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements, see “—Financial Presentation and Accounting Policies—Critical Accounting Policies and Estimates” and Note 3.2 to our audited consolidated financial statements as of December 31, 2025 and 2024 and for the fiscal years ended December 31, 2025, 2024, and 2023, included elsewhere in this annual report.
No new accounting standards or amendments that came into effect in the years ended December 31, 2025, 2024, and 2023 have had a material impact on our consolidated financial statements.
We present below the main new and amended standards and interpretations that have been issued but are not yet effective and that may impact our financial statements, noting that we intend to adopt them when they become effective.
IFRS 18, issued in April 2024, replaces IAS 1 and establishes new requirements for the presentation and disclosure of financial statements, particularly the statement of profit or loss. The standard requires the classification of income and expenses into new categories, the disclosure of management‑defined performance measures, and changes to the aggregation and disaggregation of information. It also amends IAS 7, affecting the presentation of operating cash flows. IFRS 18 will be applied from January 1, 2027, on a retrospective basis, and we are currently assessing the impacts required to comply with the new requirements within the established time frame.
Rubens Ometto Silveira Mello, who controls the majority of our common shares, has the overall power to control us, including the power to establish our management policies.
Our board of directors consists of at least five (5) members and at most twenty (20) members. Out of the members of the Board of Directors, at least two members or 20% of the members, whichever is higher, must be independent directors, as defined in the Novo Mercado Rulebook. The qualification of the members appointed as independent directors will be resolved upon at the shareholders’ meeting that elects such independent directors. A director elected as permitted under article 141, paragraphs 4 and 5 of the Brazilian Corporation Law will also be deemed an independent director even if there is a controlling shareholder. Should compliance with the foregoing percentage requirement lead to a fractional number of directors, the number of directors will be rounded to the whole number immediately higher.
The number of directors to be elected for the upcoming term will be decided by a majority vote at the relevant shareholders’ meeting. A shareholder or a group of shareholders representing at least 15% of the share capital of Cosan may separately elect up to one additional director. Additionally, shareholders representing a percentage of the share capital of Cosan of 5% (depending on the aggregate value of capital stock of Cosan at such time, pursuant to the applicable CVM ruling) may request that the election of directors be subject to cumulative voting proceedings, as provided for in article 141 of the Brazilian Corporation Law and CVM Ruling 70.
Board of Directors
Our board of directors is the decision-making body responsible for, among other things, determining policies and guidelines for our business. The board of directors also supervises our executive officers and monitors their implementation of policies and guidelines established from time to time by our board of directors.
The following table lists the members of our board of directors:
Rubens Ometto Silveira Mello
April 30, 2025
Chairman
1950
André Santos Esteves
November 11, 2025
Vice Chairman
1968
Marcelo Eduardo Martins
Director
1966
Burkhard Otto Cordes
1975
Renato Antônio Secondo Mazzola
1976
Ralph Gustavo Rosenberg Whitaker Carneiro
1981
Flávia Cruz Simon (1)
1979
Luís Claudio Rapparini Soares(1)
1965
The following is a summary of the business experience of our current directors. Unless otherwise indicated, the business address of our current directors is Av. Brigadeiro Faria Lima, 4,100 – 16th floor, São Paulo – SP, Zip Code 04538-132, Brazil.
Rubens Ometto Silveira Mello. Mr. Mello is the chairman of Cosan, Compass, Rumo, Radar, Moove and Raízen, in addition to being the controlling shareholder of these companies. He is also the chairman of our People and Nominating Committee and the chief executive officer of Aguassanta Participações S.A. Furthermore, he participates in social work as a member of the Board of Gerando Falcões and the Institute of Corporate Citizenship. He holds a degree in mechanical engineering from the Polytechnic School of the University of São Paulo (Escola Politécnica da Universidade de São Paulo) (1972), a post‑graduate degree in finance from the Universidade Metodista de Piracicaba, or “UNIMEP,” and an MBA degree in business management from Fundação Getúlio Vargas – FGV with an extension to Ohio University. Mr. Mello has more than 40 years of experience in the management of large companies. He has also served as planning supervisor, financial manager, and administrative and financial superintendent of Costa Pinto S.A. from 1983 to 1990, and as an officer and chairman of the board of directors of Aguassanta Participações S.A. since 2001. He is also one of the founders of UNICA, the Sugarcane Agroindustry Association of the State of São Paulo (UNICA – União da Agroindústria Canavieira do Estado de São Paulo). Prior to joining Cosan, Mr. Mello worked from 1971 to 1973 as an advisor to the board of executive officers of UNIBANCO – União de Bancos Brasileiros S.A., and from 1973 to 1980 as chief financial officer of Indústrias Votorantim S.A.
André Santos Esteves. Mr. Esteves is the Chairman of BTG Pactual and is currently the Vice‑Chairman of the board of directors of Cosan. Mr. Esteves began his career in 1989, joining Banco Pactual at the age of 21. Over more than three decades with the firm, he has played a central role, together with his partners and colleagues, in transforming BTG Pactual into a global financial group and the leading investment bank in Latin America, now employing more than 5,000 people. Mr. Esteves has also served on the board of directors of B3 – the Brazilian Stock Exchange and on the board of FEBRABAN – the Brazilian Federation of Banks. Mr. Esteves is active in social, educational, and socio‑environmental initiatives. He is a founding partner of Inteli and has served on the Latin American Council of Harvard Business School and on the Board of Fundação Estudar, an organization dedicated to supporting undergraduate and postgraduate education for young Brazilians and facilitating their entry into the job market. Mr. Esteves studied Mathematics at the Federal University of Rio de Janeiro (UFRJ), with a specialization in Computing.
Marcelo Eduardo Martins. Mr. Martins became our current chief executive officer on November 1, 2024. He became an executive officer of Aguassanta Participações S.A. in July 2007. Since then, he has held various significant positions at companies within the Cosan group. He is currently our chief executive officer, vice‑chairman of our board of directors, former chief financial officer and investor relations officer, and former chief strategy officer. He is also a member of the boards of directors of Raízen S.A., Rumo S.A., Moove, Compass Gás e Energia S.A. and Eurofarma. At Rumo, he is also a member of the People, Nomination and Compensation Committee, the Strategic and Sustainability Committee, and the Finance Committee. Prior to joining the Cosan group, Mr. Martins was the chief financial and business development officer of Votorantim Cimentos between July 2003 and July 2007 and, prior to that, head of Latin American Fixed Income at Salomon Smith Barney (Citigroup) in New York. He has significant experience in capital markets, having worked at Citibank (where he began his career as a trainee in 1989), Unibanco, UBS, and FleetBoston. He has a degree in business administration from FGV, specializing in finance.
Burkhard Otto Cordes. Mr. Cordes has been a member of our board of directors since 2005. He currently serves on our People and Nominating Committee as well as our Sustainability Committee. Additionally, he is a member of the board of directors and the financial committee of Rumo, and serves on the board of directors and the People and Nominating Committee of Compass Gás e Energia S.A. He is also a board member of Aguassanta Participações S.A. Mr. Cordes holds a degree in business administration from Fundação Armando Álvares Penteado (1997) and an MBA in finance from IBMEC-SP (2001). His career includes experience in financial markets at Banco BBM S.A., a Grupo Mariani company, where he worked in the commercial division focusing on corporate and middle market segments. Prior to his current role, he worked at IBM Brasil in its financial division.
Renato Antônio Secondo Mazzola. Mr. Mazzola has served as a Partner of the BTG Pactual Group since June 2011 and is currently responsible for the firm’s Infrastructure and Private Equity division. He also serves as a board member of various companies across multiple sectors and jurisdictions. In Brazil, he serves on the boards and the People Committee of Cosan S.A., Tropicalia Transmissora de Energia S.A., A BodyTech S.A., CCRR Participações S.A., Globenet Cabos Submarinos S.A., Universo Online S.A., AllPark Empreendimentos Participações e Serviços S.A. (Estapar), Rede Inspira de Educadores, and Contrail Logística S.A. In Chile, he serves as a board member of Latin America Power S.A., Infraestructura Interportuaria S.A., Trenes Continentales S.A., Sociedad Concesionaria Autopista S.A., Sociedad Concesionaria Melipilla S.A., Ruta de los Ríos Sociedad Concesionaria S.A., and Sociedad Concesionaria Valles del Desierto S.A. In Bolivia, he serves as a board member of Trenes Continentales S.A. Mr. Mazzola has extensive experience in the financial markets, including the management of investments in infrastructure and private equity companies. Before joining BTG Pactual, he served as a senior investment manager in the infrastructure division of the Inter‑American Development Bank (IDB) in Washington, D.C. From 1999 to 2003, he spent five years at J.P. Morgan. He has served on the board of Tunels de Barcelona I CADI CGC S.A. (2012–2014) and ATLL Concessionária de La Generalitat de Catalunya (2012–2015), both located in Spain. Mr. Mazzola earned a degree in Economics from Pontifical Catholic University (PUC‑SP), an MBA in Capital Markets from the University of São Paulo (USP), and a Master’s degree in International Relations from The Fletcher School at Tufts University.
Ralph Gustavo Rosenberg Whitaker Carneiro. Mr. Carneiro is the Chief Investment Officer of Perfin Asset since 2007 and is a founder and member of the executive committee of the Perfin group. He is responsible for the management of Perfin Infra and has more than 15 years of experience in the infrastructure sector, during which he has overseen numerous investments and divestments across the industry. Mr. Carneiro currently serves on the board of directors and the People Committee of Cosan S.A., Cia Riograndense de Saneamento, and EPR Rodovias, as well as several transmission line projects in partnership with Alupar, among other companies. His professional career has been focused on the financial markets, with significant involvement in infrastructure‑related investments. Mr. Carneiro graduated with a degree in Business Administration, with a specialization in finance and the electric sector.
Flávia Cruz Simon. Ms. Simon has 25 years of experience in large technology companies. She has built her career in new technologies and, more recently, in artificial intelligence, having spent much of her career in California, working with leading technology companies. She serves on the board of directors and the Sustainability Committee of Cosan S.A., is a member of the Board of Directors of TradersClub, was Global Marketing Leader at Fitbit, held several leadership positions at Google, and served as Senior Manager at Intel Corporation. She is currently the Senior Director of Marketing at Google in Brazil.
Luis Claudio Rapparini Soares. Mr. Rapparini has over 32 years’ experience in the financial and internal audit areas. He was CFO of the British American Tobacco Group, Souza Cruz S.A., and the Raízen Group and Chief Internal Auditor of Royal Dutch Shell, working in five countries and four continents. He has participated in several executive development programs at Wharton, Kellogg, INSEAD, and IMD universities. He is currently a member of the Board of Directors and the Compensation Committee of Datatec LTD; a member of the Audit and Risk Committee, Compensation Committee, and Finance Committee of Logicalis LATAM; a member of the Board of Directors and the Audit Committee of OceanPact; and Chairman of the Audit Committee of Amaggi S.A.
Executive Officers
Our executive officers serve as our executive management body. They are responsible for our internal organization and day-to-day operations and for the implementation of the general policies and guidelines established from time to time by our board of directors.
Our bylaws require that our board of executive officers consist of a minimum of three and a maximum of eight officers, each responsible for a specific area of the business.
The following table lists our current executive officers:
Chief Executive Officer
Chief Financial and Investor Relations Officer
1978
Maria Rita de Carvalho Drummond
General Counsel
1980
The following is a summary of the business experience of our executive officers. Unless otherwise indicated, the business address of the executive officers is Avenida Brigadeiro Faria Lima, 4,100 – 16th floor, Room 1, São Paulo – SP, 04538-132, Brazil.
Marcelo Eduardo Martins. See “—Board of Directors.”
Rafael Bergman. Mr. Bergman serves as our Chief Financial and Investor Relations Officer. He was previously at Banco ABN AMRO and thereafter joined the Shell Group in 1999, where he held various finance and M&A positions in Brazil, the United Kingdom, and the Netherlands. In 2011, he participated in the formation of Raízen, where he served as Director of Treasury, Controllership, and Financial Planning. In 2016, he joined the board of Comgás and served in multiple executive roles, including Chief Financial and Investor Relations Officer, Chief Operating and Services Officer, and Director of Strategy and Market. In 2020, he contributed to the launch of Compass Gas & Energia S.A., where he served as Chief Financial and Investor Relations Officer until January 1, 2022. From January 2, 2022 to November 2024, he served as Executive Vice President of Finance and Investor Relations at Rumo S.A. He subsequently rejoined Raízen as Chief Financial and Investor Relations Officer on November 14, 2024, a position he held until November 30, 2025. He holds a degree in Economics from the Pontifical Catholic University of Rio de Janeiro and a Master’s in Finance from the London Business School.
Maria Rita de Carvalho Drummond. Ms. Drummond has been our general counsel since 2011. She is also a member of the board of directors of Compass Gás e Energia S.A. and Rumo. She joined the Cosan group in 2008, after leaving the law firm Barbosa, Mussnich e Aragão, where she worked from 2000 to 2004 and from 2007 to 2008. Ms. Drummond was a manager for Latin America at BAT, the controlling shareholder of Souza Cruz S.A., based in London, from 2004 to 2005. In 2019, Ms. Drummond was appointed by the Brazilian Association of Listed Companies (Associação Brasileira das Companhias Abertas) to hold a position on the Appeal Council of the National Financial System (Conselho de Recursos do Sistema Financeiro Nacional), with a mandate until March 2022. Ms. Drummond holds a law degree from Pontifícia Universidade Católica do Rio de Janeiro, a postgraduate degree in civil law from Universidade Estadual do Rio de Janeiro, and a master’s degree in international law from the London School of Economics.
Committees of the Board of Directors
Audit Committee
Our audit committee is a statutory and permanent body, responsible for undertaking technical and/or advisory and oversight functions. Our audit committee comprises three members, elected by our board of directors for a renewable two‑year term of office, limited to a 10‑year office renewal, all of whom are independent. Our audit committee was created on March 28, 2012, at an extraordinary shareholders’ meeting. Our audit committee is governed by internal regulations that were approved by a meeting of our board of directors on November 4, 2025.
Our audit committee has the following responsibilities:
Our statutory audit committee meets the requirements for the exemption available to foreign private issuers under paragraph (c)(3) of Rule 10A‑3 under the Exchange Act. The statutory audit committee is not equivalent to, or wholly comparable to, a U.S. audit committee. Among other differences, it is not required to meet the standards of “independence” established in Rule 10A‑3 and is not fully empowered to act on all matters that are required by Rule 10A‑3 to be within the scope of an audit committee’s authority.
The following table sets forth certain information related to the current members of our audit committee, all of whom are independent:
Carla Alessandra Trematore
May 2, 2025
Chair
Luis Claudio Rapparini Soares
Member
Paulo Clovis Ayres Filho
The terms of the current members of our audit committee expire in May 2027 or until the election of new members.
We present below a brief biographical description of each member of our audit committee.
Carla Alessandra Trematore. Ms. Trematore currently serves on our audit committee, on the audit committee of Rumo, and on the fiscal council of Comgás. She holds bachelor’s degrees in accounting from PUC Minas and in Computer Science from UNESP. She began her career in independent auditing, working at Arthur Andersen, Deloitte and EY from 1996 to 2010. She has more than 29 years of experience in accounting, auditing, consulting and corporate governance. From 2017 to 2020, she served as Chairperson of the Audit Committee of Caixa Econômica Federal. As of the date of this annual report, she also serves on the boards of directors of CI&T Inc., BRBI BR Partners S.A. and Allied Tecnologia S.A., and on the audit committees and fiscal councils of several public companies.
Paulo Clovis Ayres Filho. Mr. Ayres Filho is currently a member of our audit committee and a member of the audit committee of Compass Gás e Energia S.A., and since January 2024, a member of the executive council at Fundação Souza Cruz. Mr. Ayres Filho holds a bachelor’s degree in engineering from the Escola Politécnica and a bachelor’s degree in economics from the Faculdade de Economia, Universidade de São Paulo. He has extensive experience in the financial industry sector, including in international and domestic businesses, from 1985 through 2019. He worked as the Global Head of Strategy and Planning at British American Tobacco (UK) from 2015 through 2019. Since 2020, Mr. Ayres Filho has acted as an independent financial consultant and has served as a member of the fiscal council of Vale S.A.
See “—Board of Directors” above for a brief biographical description of Luis Claudio Rapparini Soares.
Our board of directors has determined that Carla Alessandra Trematore, Luis Claudio Rapparini Soares, and Paulo Clovis Ayres Filho meet the independence requirements of the SEC and the NYSE listing standards, and Carla Alessandra Trematore is our audit committee financial expert.
People and Nominating Committee
Our People and Nominating Committee was established on August 18, 2011, and was reconstituted on April 27, 2017. On January 27, 2022, the committee was renamed the People and Nominating Committee effective immediately (it was previously known as the People Committee). It comprises three members, each appointed for a two‑year term. Our People and Nominating Committee is governed by internal regulations that were approved at a meeting of our board of directors on February 20, 2024.
The role of our People and Nominating Committee is to provide guidance for strategic decision‑making in relation to human resources, including, but not limited to, issues relating to compensation, goals, diversity, development, succession, leadership, and the identification, recruitment, interviewing, and selection of potential candidates to fill vacancies on our board of directors or among our officers, among others. Furthermore, the committee also advises our board of directors on matters relating to the fixed and variable compensation of our directors, officers, members of our fiscal council, and other employees, the definition and control of targets, as well as providing information to our board of directors.
The following table sets forth certain information related to the current members of our People and Nominating Committee:
December 16, 2025
The terms of the current members of our people and nominating committee expire in December 2027.
See “—Board of Directors” above for a brief biographical description of each member of our people and nominating committee.
Sustainability Committee
Our sustainability committee was established on January 27, 2022. On August 13, 2024, the committee was re-named the sustainability committee (it was previously known as the strategy and sustainability committee). It consists of at least three members, each appointed on a two-year term. Our sustainability committee is governed by internal regulations that were approved at a meeting of our board of directors on August 13, 2024.
The role of our sustainability committee is to assess strategies, projects, objectives and commitments of Cosan and its subsidiaries with respect to sustainability matters as well as to monitor the Company’s performance in both Brazilian and international indices and rating with respect to environment, social, and governance actions, proposing improvements, pursuing opportunities and assessing sustainability-related risks arising from the activities of Cosan and its subsidiaries. The sustainability committee is also tasked with promoting debate about matters related to sustainability, including by proposing objectives and targets, and to oversee the sustainability committees of our subsidiaries, if applicable.
The following table sets forth certain information related to the current members of our sustainability committee:
Flávia Cruz Simon
May 23, 2025
The terms of the current members of our sustainability committee expire in May 2027.
See “—Board of Directors” above for a brief biographical description of each member of our sustainability committee.
Fiscal Council
The Brazilian Corporation Law establishes the responsibilities, duties, and powers of the fiscal council. Fiscal council resolutions are passed upon a majority of the votes of members present at fiscal council meetings.
The role of our fiscal council is to: (1) supervise the actions of officers and directors, and their compliance with legal and statutory requirements; (2) voice its opinion regarding management’s annual report and include in its report on such matter the additional information it believes is necessary or useful to the deliberations of our general shareholders’ meetings; (3) voice its opinion on the proposals of management bodies to be submitted to our general shareholders’ meetings in relation to changes to the capital, issuance of debentures or subscription bonuses, investment plans or capital budgets, distributions of dividends, transformations, incorporations, or spin‑offs; (4) report to management on any mistakes, fraud, or crime which it uncovers, and if management does not take appropriate action to protect our interests, report to the general shareholders’ meeting and recommend useful steps we may take in this regard; (5) call an ordinary general shareholders’ meeting if management bodies delay the calling thereof for over a month, and extraordinary general shareholders’ meetings whenever serious or urgent events occur, and include in the agenda for such meetings the items which it considers necessary; (6) analyze, at least on a quarterly basis, our financial statements; (7) review our financial statements for each fiscal year and voice its opinion thereon; and (8) exercise the aforementioned functions during a liquidation, taking into account the specific provisions governing such a situation.
The following sets forth certain information related to the current members of our fiscal council:
João Ricardo Ducatti
Mônica Pires da Silva
Guido Barbosa de Oliveira
August 29, 2025
The terms of the current members of our fiscal council expire at our ordinary general shareholders’ meeting convened to resolve on the annual accounts and the financial statements for the fiscal year ending on December 31, 2025.
João Ricardo Ducatti. Mr. Ducatti is a business manager. He is a member of our fiscal council and of the audit committee of Rumo. He worked at Westinghouse of Brazil from 1973 to 1982, where he was a financial resources manager and a treasurer for Latin America, and then as business manager of Usina Barbacena, located in Ribeirão Preto, in 1982 and 1983. He was also an administrative and financial officer of Grupo Bom Jesus, which produces sugar and ethanol and is located in Piracicaba, from 1983 to 1991, and an administrative and financial officer of the Cosan group, which produces sugar and ethanol and is also located in Piracicaba, from 1991 to 1995. He was also a managing officer of SUCRESP, a professional association representing 17 mills producing sugar and alcohol, from 1995 to 1999. From 1999 to the present, he has focused on providing economic and financial advisory services, asset valuation, management of corporate structuring, sales development of equity, and other associated activities through his company, RDR Consultores Associados Ltda. Mr. Ducatti holds a bachelor’s degree in business administration from Faculdade de Ciências Administrativas e Contábeis Tabajara.
Mônica Pires da Silva. Mrs. Silva worked at IBM Brasil in 1989, where she remained for more than 30 years, occupying several leadership positions in multidisciplinary and global teams. She led the Business Controls area at IBM Brasil, where she implemented Sarbanes‑Oxley, in the position of Indirect Tax Manager. She was Finance Controller of IBM’s Consulting Division, Financial Director of Lotus Brasil, and CFO of the Research Laboratory. Her last position when she left IBM in May 2023 was Global Finance and Operations Leader for AI (Artificial Intelligence) and Finance and Operations Leader for the India, Brazil, and Singapore Research Labs. She also served as a member of boards of directors, fiscal councils, audit committee coordination committees, and startup & scale‑up mentoring programs.
Guido Barbosa de Oliveira. Mr. Barbosa de Oliveira began his career at Grupo Jereissati/Iguatemi in 1995 as a trainee and subsequently held a variety of positions within the organization, including Manager of New Business and M&A and Financial Manager. Prior to joining the group, he worked at Banco Real S.A. and Citrosuco Company S.A. He also served as an Administrative Advisor at Contax Participações S.A. from April 2014 to April 2016. He is also a member of the Fiscal Council of Rumo. He holds a bachelor’s degree in Economics from Universidade Estadual Paulista (UNESP), a postgraduate degree in Financial Administration from FGV/SP, and an Executive MBA from Insper, including a specialization in Global Business from the Darden School of Business at the University of Virginia.
Our Relationship with Our Executive Officers, Directors and Key Managers
Mr. Burkhard Otto Cordes is a member of Cosan’s boards of directors and serves as a financial manager at Aguassanta Participações S.A. Mr. Cordes was previously married to Mr. Mello’s daughter. There are no arrangements or understandings with any of our shareholders, customers, suppliers or others, pursuant to which any director or member of our senior management has been or will be selected.
Under our current bylaws, our general shareholders’ meeting is responsible for approving the annual aggregate compensation that we pay to the members of our board of directors and our executive officers. The aggregate amount of compensation paid to all members of the board of directors and its executive officers on a consolidated basis was R$246.0 million during the fiscal year ended December 31, 2025, R$253.5 million during the fiscal year ended December 31, 2024 and R$368.2 million in the fiscal year ended December 31, 2023. Our compensation strategy aims to reflect best market practice, help us retain our executives and incentivize them to produce superior results.
Our executive officers receive the same benefits generally provided to our employees. Members of our board of directors are not entitled to these benefits. We currently have no employment agreements with our directors and executive officers providing for benefits upon the termination of employment.
Equity-Based Compensation Plans
In addition, certain executive officers, managers and other eligible employees may receive equity-based compensation pursuant to our restricted stock plan.
See “—E. Share Ownership—Equity-Based Compensation Plans” for information on the equity-based compensation plans in place at our Company.
Summary of Significant Differences of Corporate Governance Practices
The Sarbanes-Oxley Act, as well as related rules subsequently implemented by the SEC, require foreign private issuers, such our Company, to comply with various corporate governance practices. In addition, following the listing of our ADSs on the NYSE, we are required to comply with the listing rules of the NYSE, or NYSE rules.
NYSE rules include certain accommodations to corporate governance requirements that allow foreign private issuers, such as our Company, to follow “home country” corporate governance practices in lieu of the otherwise applicable corporate governance standards of the NYSE. Under NYSE rules, we are required to:
A summary of the significant differences between our corporate governance practices and those required of U.S. listed companies is included below.
Majority of Independent Directors
NYSE rules require that a majority of the board of a listed company consist of independent directors. Independence is defined by various criteria, including the absence of a material relationship between the director and the listed company. Under the B3 listing rules, our board of directors must be composed of a minimum of two independent directors or a minimum of 20% of our total directors must be independent, whichever is greater. Additionally, pursuant to the Brazilian Corporation Law and CVM regulations, our directors are required to meet certain qualification requirements that address their compensation, duties and responsibilities. While our directors meet the qualification requirements of the Brazilian Corporation Law and CVM regulations, we do not believe that a majority of our directors would be considered independent under the NYSE rules test for director independence.
Executive Sessions
NYSE rules require that independent directors must meet at regularly scheduled executive sessions. The Brazilian Corporation Law does not have a similar provision, however, the bylaws may provide for such requirement. Under our bylaws, all directors shall meet at least four times each year.
Nominating/Corporate Governance Committee and Compensation Committee
NYSE rules require that listed companies maintain a nominating/corporate governance committee and a compensation committee comprising entirely independent directors and governed by a written charter addressing each committee’s required purpose and detailing its required responsibilities. The responsibilities of the nominating/corporate governance committee include, among other matters, identifying and selecting qualified board member nominees and developing a set of applicable corporate governance principles. The responsibilities of the compensation committee, in turn, include, among other matters, reviewing corporate goals relevant to the chief executive officer’s compensation, evaluating the chief executive officer’s performance, approving the chief executive officer’s compensation levels and recommending to the board compensation of other executive officers, incentive compensation and equity-based compensation plans.
Pursuant to the Brazilian Corporation Law, we are not required to maintain a nominating committee, corporate governance committee or a compensation committee. Aggregate compensation for our directors and executive officers is established by our shareholders at annual shareholders’ meetings. The allocation of aggregate compensation among our directors and executive officers is determined by our directors at board of director meetings. The Brazilian Corporation Law and CVM regulations establish rules in relation to certain qualification requirements and restrictions, compensation, duties and responsibilities of a company’s executives and directors. In addition to the foregoing, the Novo Mercado Rules applicable to us require that the board of directors of a company discusses and approves certain internal policies, including a compensation policy and a nominating policy.
Audit Committee and Audit Committee Additional Requirements
Under Section 303A.06 of the NYSE listing rules and the requirements of Rule 10A-3 under the Exchange Act, each U.S. listed company is required to have an audit committee consisting entirely of independent members that comply with the requirements of Rule 10A-3. In addition, the audit committee must have a written charter compliant with the requirements of Section 303A.07(b) of the NYSE listing rules, the listed company must have an internal audit function and the listed company must fulfill all other requirements of the NYSE and Rule 10A-3. The SEC has recognized that, for foreign private issuers, local legislation may delegate some of the functions of the audit committee to other advisory bodies. We have established a statutory audit committee. Our statutory audit committee meets the requirements for the exemption available to foreign private issuers under paragraph (c)(3) of Rule 10A-3 under the Exchange Act. The statutory audit committee is not the equivalent of, or wholly comparable to, a U.S. audit committee. Among other differences, it is not required to meet the standards of “independence” established in Rule 10A-3 and is not fully empowered to act on all the matters that are required by Rule 10A-3 to be within the scope of an audit committee’s authority.
Shareholder Approval of Equity Compensation Plans
NYSE rules provide for limited exceptions to the requirement that shareholders be given the opportunity to vote on all equity compensation plans and material revisions to those plans (which may be approved for an undefined period). In contrast, pursuant to the Brazilian Corporation Law, all stock option plans must be submitted for approval by the holders of our common shares.
Corporate Governance Guidelines
NYSE rules require that listed companies adopt and disclose corporate governance guidelines. We comply with the corporate governance guidelines under applicable Brazilian law and the Novo Mercado Rules. We believe the corporate governance guidelines applicable to us under Brazilian law are consistent with the NYSE rules. We have adopted and observe policies that deal with the public disclosure of all relevant information and which requires management to disclose all transactions relating to our securities as per CVM’s regulations and the Novo Mercado Rules.
Internal Audit Function
NYSE rules require that listed companies maintain an internal audit function to provide management and the audit committee with ongoing assessments of their risk management processes and system of internal control.
The Novo Mercado Rules provide that listed companies are required to have an audit department whose activities are reported to our Audit Committee and, in turn, to our board of directors, and which, among other matters, is responsible for assessing the quality and effectiveness of their risk management processes.
As of December 31, 2025, we had 12,787 employees (including employees of our subsidiaries and excluding employees of Raízen). The following table sets forth the number of our total employees as of the dates indicated:
11,929
10,983
11,188
Abroad
Total(1)
In the year ended December 31, 2025, we had an average of 544 temporary employees.
We believe that we have good relations with our employees and the unions that represent them. Collective bargaining agreements to which we are party have either one-year or two-year terms, are subject to annual renewal and are subject to changes in Brazilian law. We apply the terms of bargaining agreements entered into with the unions equally to unionized and non-unionized employees.
Our total annual personnel expenses were R$3,183.1 million for the year ended December 31, 2025, which includes a provision for vacations, and bonuses, taxes and social contributions.
We offer our employees, including our executive officers, various benefits, which are provided in accordance with the employee’s position in our company. Benefits include medical (including dental) assistance, meal and transport vouchers, life insurance, maternity leave, scholarships and funeral assistance and nursery assistance. All of our employees participate in profit sharing plans developed with the labor unions of which our employees are members, which provide performance-based compensation.
As of March 18, 2026, the following members of the board of directors and executive officers owned our shares and ADSs:
Rubens Ometto Silveira Mello*
712,702,674
27,402,564
Other than as disclosed in the table above, none of the members of our board of directors or our executive officers currently owns or holds common shares or ADSs of our Company.
Below is a description of our equity-based compensation plans. See note 24 to our audited consolidated financial statements included elsewhere in this annual report for additional information.
Cosan S.A.
Cosan has two share-based compensation plans in effect: (i) the share purchase option plan, approved by the Company’s Ordinary and Extraordinary General Meeting, held on July 29, 2011, or the “Stock Option Plan,” which has not made active grants since 2017, and (ii) the share-based remuneration plan, approved by the Company’s Ordinary and Extraordinary General Meeting, held on April 27, 2017, or the “Share-Based Remuneration Plan.” The Share-Based Remuneration Plan provides for the distribution of up to 3% of the Company’s common shares, after giving effect to the issuances of common shares under such plan.
As of the date of this annual report, 43,936,663 common shares of the Company have been granted pursuant to these plans, amounting to 1.11% of the Company’s share capital as of December 31, 2025. This includes shares that were granted in 2017 by the Company in replacement of the options delivered until 2017 as part of the Stock Option Plan, before it was replaced by the Share-Based Remuneration Plan.
On May 5, 2021, a new share-based payment plan allowing for a total award of up to 1,481,000 shares of Rumo was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Rumo’s discretion, after five years.
On September 15, 2021, a new share-based payment plan allowing for a total award of up to 1,560,393 shares of Rumo was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Rumo’s discretion, after three years.
On September 1, 2022, two new share-based payment plans were approved allowing for (i) a total award of up to 1,781,640 shares of Rumo, to be granted at Rumo’s discretion to eligible executives through common shares, no cash consideration, or cash, after three years, and (ii) a total award of up to 146,909 shares of Rumo, to be granted at Rumo’s discretion to eligible executives through common shares, no-cash consideration or cash.
On September 6, 2023, a new share-based payment plan allowing for a total award of up to 1,724,867 shares of Rumo was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Rumo’s discretion, after three years.
On August 22, 2024, a new share-based payment plan allowing for a total award of up to 2,433,432 shares of Rumo was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Rumo’s discretion, after three years.
Comgás
On November 1, 2021, Comgás awarded 195,414 restricted shares to certain eligible executives, which will be fully transferred three years from the approval of the grant. The final transfer of the restricted shares to the executives is subject to the terms of the applicable share-grant program.
On August 1, 2021, a new share-based payment plan allowing for a total award of up to 30,205 shares of Compass was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Compass’ discretion, after two years.
On August 1, 2021, a new share-based payment plan allowing for a total award of up to 35,777 shares of Edge Comercialização was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Edge Comercialização’s discretion, after three years.
On August 1, 2021, a new share-based payment plan allowing for a total award of up to 173,316 shares of Compass was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Compass’ discretion, after three years.
On August 1, 2021, a new share-based payment plan allowing for a total award of up to 38,158 shares of Terminal de Regaseificação de São Paulo was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Terminal de Regaseificação de São Paulo’s discretion, after three years.
On November 1, 2021, a new share-based payment plan allowing for a total award of up to 1,672,626 shares of Compass was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Compass’ discretion, after three years.
On February 1, 2022, a new share-based payment plan allowing for a total award of up to 88,899 shares of Compass was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Compass’ discretion, after three years.
On August 1, 2022, a new share-based payment plan allowing for a total award of up to 31,258 shares of Terminal de Regaseificação de São Paulo was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Terminal de Regaseificação de São Paulo’s discretion, after three years. On August 1, 2022, a new share-based payment plan allowing for a total award of up to 826,392 shares of Compass was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Compass’ discretion, after three years.
On August 1, 2022, a new share-based payment plan allowing for a total award of up to 30,441 shares of Edge Comercialização was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Edge Comercialização’s discretion, after three years.
On August 1, 2023, a new share-based payment plan allowing for a total award of up to 234,741 shares of Compass was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Compass’ discretion, after three years.
On August 1, 2023, a new share-based payment plan allowing for a total award of up to 24,862 shares of Edge Comercialização was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Edge Comercialização’s discretion, after three years.
On August 1, 2023, a new share-based payment plan allowing for a total award of up to 22,187 shares of Terminal de Regaseificação de São Paulo was approved. The eligible executives may be granted common shares or no-cash consideration or cash, at Terminal de Regaseificação de São Paulo’s discretion, after three years.
On August 1, 2024, a new share-based payment plan was approved at Compass Gás e Energia allowing for a total award of 273,269 shares of Compass. After three years, eligible executives may be granted an amount in cash equivalent to the value of the shares.
On August 1, 2024, a new share-based payment plan was approved at Edge Comercialização allowing for a total award of 72,548 shares of Edge Comercialização. After three years, eligible executives may be granted an amount in cash equivalent to the value of the shares.
On August 1, 2024, a new share-based payment plan was approved at Terminal de Regaseificação de São Paulo allowing for a total award of 2,645 shares of Terminal de Regaseificação de São Paulo was approved. After three years, eligible executives may be granted an amount in cash equivalent to the value of the shares.
On August 1, 2025 a new share-base payment plan was approved at Compass Gás e Energia allowing for a total award of 411,607 shares of Compass.
On July 31, 2020, Moove awarded 106,952 share appreciation rights to certain eligible executives. The rights entitle the executives to a cash payment after five years of service. The amount payable will be determined based on the increase of the share price between the grant date and the vesting date. The rights must be exercised on the vesting date and will expire if not exercised on that date.
On July 31, 2021, Moove awarded 80,729 share appreciation rights to certain eligible executives. The rights entitle the executives to a cash payment after three years of service. The amount payable will be determined based on the increase of the share price between the grant date and the vesting date. The rights must be exercised on the vesting date and will expire if not exercised on that date.
On July 31, 2022, Moove awarded 615,362 share appreciation rights to certain eligible executives. The rights entitle the executives to a cash payment after four years of service. The amount payable will be determined based on the increase of the share price between the grant date and the vesting date. In July 2023, such share appreciation rights were canceled.
On July 31, 2022, Moove awarded 77,967 share appreciation rights to certain eligible executives. The rights entitle the executives to a cash payment after three years of service. The amount payable will be determined based on the increase of the share price between the grant date and the vesting date. The rights must be exercised on the vesting date and will expire if not exercised on that date.
On July 31, 2023, Moove awarded 82,204 share appreciation rights to certain eligible executives. The rights entitle the executives to a cash payment after three years of service. The amount payable will be determined based on the increase of the share price between the grant date and the vesting date. The rights must be exercised on the vesting date and will expire if not exercised on that date.
On July 31, 2023, Moove created an incentive program conditioned on length of service (service conditions) and the occurrence of certain liquidity events as set forth in such program (performance conditions). The options granted to participants may only be exercised after they become vested options, and the maximum period for exercising such options will be six years from the date of grant. As of the date of this annual report, Moove has awarded 1,342,609 shares to certain eligible executives.
On July 31, 2024, Moove awarded 61,372 share appreciation rights to certain eligible executives. The rights entitle the executives to a cash payment after three years of service. The amount payable will be determined based on the increase of the share price between the grant date and the vesting date. The rights must be exercised on the vesting date and will expire if not exercised on that date.
Cosan Limited and Cosan Logística
Cosan Limited’s and Cosan Logística’s equity-based compensation plan were discontinued and all outstanding awards were settled before the merger of Cosan Limited and Cosan Logística with and into Cosan S.A.
As of March 18, 2026, our issued share capital was R$10,282.7 million, fully issued and paid in, comprising 3,966,570,932 common shares, nominative and without nominal value (including 57,764,410 treasury shares).
The following table sets forth, as of March 18, 2026, except where otherwise noted, certain information with respect to the number of common shares beneficially owned (as defined by the SEC’s rules and regulations) by (1) each of our executive officers, (2) each member of our board of directors, (3) all current executive officers and directors as a group, and (4) each person known to us to own beneficially more than 5% of our outstanding common shares:
Controlling Group(1)
672,312,930
16.95%
Vertiz Holding S.A.(2)
959,661,363
24.19%
17,489,858
0.44%
4,602,365
0.12%
Others
2,254,740,006
56.84%
Treasury Shares
Ex-Treasury Shares
The total number of ADSs held by U.S. investors as of March 18, 2026, is 81,472,200 (representing 325,888,801 common shares). The total number of common shares held by U.S. investors as of March 18, 2026, is 237,125,257 (excluding common shares held by JPMorgan Chase Bank, N.A. as depositary).
Controlling Group
On April 30, 2019, a corporate reorganization was approved among companies from our controlling group (Aguassanta Participações S.A., or “Aguassanta,” Queluz S.A. Administração e Participações, or “Queluz,” Costa Pinto S.A., or “Costa Pinto,” and Usina Bom Jesus S.A. Açúcar e Álcool, or “UBJ”), which wished to consolidate their control with Aguassanta, controlled by Mr. Rubens Ometto Silveira Mello. As a result, Costa Pinto, UBJ, and Queluz merged into Aguassanta on April 30, 2019.
This reorganization resulted in the transfer by Queluz and UBJ to Aguassanta of 19,499,418 Class A common shares issued by Cosan Limited and the transfer by Queluz and Costa Pinto to Aguassanta of all the Class B common shares issued by Cosan Limited.
On July 29, 2019, Aguassanta approved the incorporation of a new company named Aguassanta Investimentos S.A., or “Aguassanta Investimentos,” into which Aguassanta contributed the entire block of Class A common shares and Class B common shares issued by Cosan Limited that it held.
Aguassanta Investimentos was the direct controlling shareholder of Cosan Limited, and our indirect controlling shareholder prior to our intra-group restructuring that occurred on January 22, 2021, pursuant to which Cosan Limited and Cosan Logística were merged into us.
On November 28, 2025, Aguassanta Investimentos was merged with and into its direct parent, Aguassanta Participações S.A., or “AS Par.” As a result, the common shares of Cosan previously held by Aguassanta Investimentos were transferred to, and are now held by, AS Par. AS Par is the successor of Aguassanta Investimentos in all respects under Brazilian law. AS Par controls the Company directly and through the control of Vertiz Holding S.A. and Queluz Holding.
Voting Rights of Principal Shareholders
Our principal shareholders do not have voting rights distinct from those of our other shareholders of the same class of shares. See “Description of Share Capital—A. Memorandum and Articles of Association.”
On February 24, 2014, Cosan S.A., through its subsidiary Rumo Logística Operadora Multimodal S.A., or “Rumo Logística,” submitted to ALL a binding proposal for the incorporation of ALL by Rumo. The merger was completed on April 1, 2015. See “Item 4. Information on the Company—A. History and Development of the Company” for further information.
On August 27, 2008, as amended on July 14, 2012, September 28, 2012 and November 4, 2016, we entered into a shareholders’ agreement with the TIAA-CREF group, regarding its subsidiary Radar, whose corporate purpose is to identify and acquire rural properties with high appreciation potential for subsequent leasing and/or sale. This agreement was terminated on November 3, 2021, and on the same date we, Mansilla Participações Ltda., and Radar II Propriedades Agrícolas S.A. entered into a new shareholders’ agreement. We currently hold approximately 50% of Radar’s capital, with the remaining 50% being divided among other investors part of TIAA-CREF group. According to the shareholders’ agreement, we retain the majority of votes on Radar’s Board of Directors as well as the power to direct the activities of Radar.
Tellus
On July 1, 2011, we entered into a shareholders’ agreement with TIAA-CREF to govern certain of their rights, duties and obligations as shareholders of Tellus Brasil Participações S.A., as amended on October 20, 2022.
Janus
On August 19, 2014, we entered into a shareholders’ agreement with TIAA-CREF to govern certain of their rights, duties and obligations as shareholders of Janus Brasil Participações S.A., as amended on October 20, 2022.
Duguetiapar e Gamiovapar
On October 20, 2022, we entered into a shareholders’ agreement with TIAA-CREF to govern certain of their rights, duties and obligations as shareholders of Duguetiapar Empreendimentos e Participações S.A. and Gamiovapar Empreendimentos e Participações S.A.
Radar Gestão de Investimentos S.A.
On March 1, 2024, we entered into a shareholders’ agreement with Nuveen Natural Capital Latam Gestora de Ativos Ltda. to govern certain of their rights, duties and obligations as shareholders of Radar Gestão de Investimentos S.A.
On July 3, 2012, we entered into the European lubricants and specialties market by signing a sale and purchase agreement with Esso Petroleum Company to acquire Comma Oil & Chemicals Limited (currently known as Moove Lubricants). The value of the transaction, after all adjustments, was less than U.S.$100 million. Moove Lubricants continued to operate in the ordinary course under the “Comma” brand, manufacturing and selling Comma-branded and private label products following the change in control, to facilitate our entry into the European lubricants market.
On November 5, 2012, we concluded the acquisition of 60.05% of Comgás from BG Group for R$3.4 billion.
In December, 2017, the put options held by three vehicles of the Shell Group against Cosan Limited were exercised. As a result, Cosan Limited delivered to Shell 17,187,937 common shares issued by us, representing 4.21% of its capital, and received 21,805,645 common shares of Comgás. These were transferred to us, under the same price and payment term conditions of the transaction with Shell. At the conclusion of this transaction, the Cosan Limited reduced its interest in our share capital to 57.98% and we increased our interest in Comgás to 79.87%, with Shell no longer being a shareholder of Comgás.
At the end of this transaction, we and Integral Investments B.V. terminated the Comgás shareholders’ agreement dated December 19, 2012.
On March 8, 2019, we announced the conclusion of the tender offer for the acquisition of class A preferred shares issued by Comgás. A total of 19,496,165 preferred shares were acquired by us in the tender offer at a price of R$82.00 per share, representing approximately 14.77% of Comgás’ capital stock. As a result, our interest in Comgás increased from 80.12% prior to this tender offer to 94.88% following the conclusion of the tender offer, while our interest in Comgás increased from 79.88% prior to this tender offer to 94.65% following the conclusion of the tender offer.
On June 30, 2019, we concluded the tender offer for the acquisition of class A preferred shares issued by Comgás. A total of 22,597,886 preferred shares were acquired by us in the tender offer at a price of R$82.00 per share, representing approximately 17.11% of Comgás’ capital stock. As a result, our interest in Comgás increased from 94.88% prior to this tender offer to 97.23% following the conclusion of the tender offer.
On September 30, 2019, we concluded the tender offer for acquisition of common shares issued by Comgás. A total of 2,527,682 common shares of Comgás were acquired by us in the tender offer at a price of R$83.16 per preferred share, representing approximately 1.92% of Comgás’ capital stock. As a result, our interest in Comgás increased from 97.23% prior to the tender offer to 99.15% following the conclusion of the tender offer.
On January 14, 2020, we contributed to the share capital of our wholly owned subsidiary Compass, formerly known as Distribuidora de Gás Participações S.A., the totality of the shares we held in Comgás (i.e., 103,699,333 common shares and 27,682,044 preferred shares), equivalent to 99.15% of the total share capital of Comgás, for an amount of R$2,862 million. As the parties to the transaction are under common control transaction, there was no effect on our consolidated financial statements. We derecognized the investment in Comgás and we recognized an investment in Compass for the same amount.
On January 3, 2022, Compass, through one of its subsidiaries, concluded the acquisition of 51% of the share capital of Sulgás in the privatization process carried out by the State of Rio Grande do Sul, former controlling shareholder of Sulgás.
On July 11, 2022, Compass concluded the acquisition from Petrobras of 51% of the share capital of Gaspetro, now known as Commit Gás S.A. (“Commit”). On October 9, 2023, Commit’s shareholders approved the partial spin-off of Commit to form a new company to be called Norgás S.A. (“Norgás”). The spun-off portion comprises shares held by Commit in Companhia de Gás do Ceará (“CEGÁS”), Companhia Potiguar de Gás (“POTIGÁS”), Gás de Alagoas S.A. (“ALGÁS”), Sergipe Gás S.A. (“SERGÁS”) and Companhia Pernambucana de Gás (“COPERGÁS”).
On October 20, 2023, Compass, through one of its subsidiaries, concluded the acquisition of 51% of the share capital of Biometano Verde Paulínia S.A., a company that will invest in the development of a biomethane purification plant.
On November 13, 2023, Compass announced the creation of a new business, known as Edge, responsible for the consolidation of Compass’ marketing and services activities, which includes the liquefied natural gas regasification terminal located in Santos, biomethane operations, gas trade and other infrastructure project.
Shareholders’ Agreements and Other Arrangements
Shareholders’ Agreement with the BTG Entities and the Perfin Entities
The Shareholders’ Agreement regulates the holdings of Holdings Aguassanta, New Holding and the Investors in the Company. The Shareholders’ Agreement will remain valid and binding (i) until the 20th anniversary of November 10, 2025, or (ii) with respect to each shareholder, until such shareholder ceases to hold, directly or indirectly, (a) until additional common shares held by Holdings Aguassanta are made subject to the Shareholders’ Agreement, at least 5.70% of the Company’s share capital that is subject to the terms of the Shareholders’ Agreement, or (b) after additional common shares held by Holdings Aguassanta are made subject to the Shareholders’ Agreement, at least 6.80% of the Company’s share capital that is subject to the terms of the Shareholders’ Agreement.
The Shareholders’ Agreement provides that certain material matters subject to approval by the Company’s board of directors and/or general shareholders’ meeting, including (among others) approval of changes to the corporate purpose, approval of the annual budget, incurrence of indebtedness above certain thresholds, determination of management compensation and approval of certain corporate policies, must first be deliberated in a prior meeting of the Strategic Investors. On November 10, 2025, Holdings Aguassanta held, directly or indirectly, a number of shares subject to the Shareholders’ Agreement that afforded it a majority of the votes in such meetings. During the first six years of the Shareholders’ Agreement from November 10, 2025, such majority will necessarily include, in all cases, the affirmative vote of Holdings Aguassanta and at least one Anchor Investor.
The Shareholders’ Agreement also classifies certain strategic matters as “protective matters,” requiring the unanimous approval of all Strategic Investors in the prior meeting. Protective matters include, among others, approval of corporate reorganizations, amendment or waiver of the poison pill clause, approval of the dividend policy, approval of related-party transactions, delisting from the Novo Mercado or deregistration as a public company and approval of the Company’s liquidation or dissolution.
In addition, the Shareholders’ Agreement provides that the Company’s board of directors be composed of at least nine members. During the first six years following the execution date of the Shareholders’ Agreement, Holdings Aguassanta will be entitled to appoint the majority of the board members (five members, including one independent member), while the Strategic Investors will be entitled to appoint four members, including one independent member. Mr. Mello, or a person designated by him, will serve as chairman of the board of directors during the first three two-year terms following the date of November 10, 2025. The Strategic Investors will have a rotating right to appoint the vice-chairman of the board for two-year terms, beginning with an initial appointment by the BTG Entities. After such period, the vice-chairman will be elected by majority vote of the board members.
After the first six years from the execution date of the Shareholders’ Agreement, members of the board of directors will be appointed by each Anchor Investor in proportion to its direct or indirect shareholding in the Company that is subject to the Shareholders’ Agreement, it being understood that (i) the shareholder holding, directly or indirectly, common shares that are subject to the Shareholders’ Agreement and which represent at least 50% of the total voting rights of the Strategic Investors that are subject to the Shareholders’ Agreement will have the right to appoint a majority of the number of members of the board of directors which the common shares subject to the Shareholders’ Agreement have the right to elect, and (ii) if Holdings Aguassanta does not hold, directly or indirectly, common shares that are subject to the Shareholders’ Agreement and which represent at least 50% of the total voting rights of the Strategic Investors that are subject to the Shareholders’ Agreement and for so long as Holdings Aguassanta holds, directly or indirectly, shares that are subject to the Shareholders’ Agreement and which represent at least (a) 16.80% of the Company’s share capital, it will be entitled to appoint four members (including two independent members), and (b) between 6.80% and 16.80% of the Company’s share capital, it will be entitled to appoint two members (including one independent member). The vice-chairman will thereafter be elected by majority vote of the board members.
The Company’s chief executive officer will be appointed by decision of the Strategic Investors in a prior meeting, based on a list of three candidates, which during the first six years from the execution date of the Shareholders’ Agreement will be presented by Holdings Aguassanta and thereafter by the shareholder holding the largest number of shares that are subject to the Shareholders’ Agreement. The other executive officers will be nominated by the Company’s chief executive officer and subject to board approval.
The appointment of board members of the Company’s relevant subsidiaries (excluding Raízen and Edge) will be decided by the Strategic Investors in a prior meeting, following the same proportionality applicable to the composition of the Company’s board of directors. The chief executive officer of such relevant subsidiaries will be appointed based on the same criteria as the Company’s chief executive officer. The other executive officers of such subsidiaries will be nominated by their respective chief executive officers and subject to board approval.
For a period of four years from the execution date of the Shareholders’ Agreement, the Strategic Investors and New Holding, or the “Restricted Shareholders,” may not transfer any shares of the Company that are subject to the Shareholders’ Agreement. After such four-year period, any Restricted Shareholder wishing to transfer shares that are subject to the Shareholders’ Agreement to outside the stock exchange must first offer such shares to the other Restricted Shareholders, who may exercise a right of first offer in proportion to their respective direct or indirect holdings of shares subject to the Shareholders’ Agreement, in accordance with the time periods and procedures set forth in the Shareholders’ Agreement. If such transfer results in the sale of a majority of such shares, the other Restricted Shareholders will be entitled to a tag-along right to sell all of their shares that are subject to the Shareholders’ Agreement on the same terms. After the first six years from the execution date of the Shareholders’ Agreement, the Restricted Shareholders may, at their sole discretion and during specific semiannual windows, designate shares previously outside the scope of the Shareholders’ Agreement to become subject to the Shareholders’ Agreement.
The Shareholders’ Agreement also provides that the Company will approve a new dividend policy consistent with its existing one and which will provide for the distribution of dividends in excess of the minimum level required by the Brazilian corporate law subject to a predetermined coverage ratio being met.
Agreements between Shell and Us
We and Shell have entered into other definitive agreements, among others, concerning the scope of the Joint Venture, the governance and management of the Joint Venture and the granting of reciprocal put and call options concerning their interests in the Joint Venture. Each of these agreements was entered into on June 1, 2011.
The shareholders’ agreement for Raízen, or the “Raízen Shareholders’ Agreement,” establishes the scope and governance of the Joint Venture. The agreement provides that the scope of the Joint Venture is the global production of sugarcane-based ethanol and sugar and the distribution; the commercialization and sale of fuel products and lubricants; the operation and franchising and/or licensing of convenience stores businesses within Brazil; the supply and commercialization of fuel products; the operation of retail stations and operation and franchising and/or licensing of convenience stores; the operation of the refinery in Buenos Aires; and the supply, blending, commercialization, and sale of lubricants within Argentina. We, Shell and our respective affiliates are prohibited from competing with the Joint Venture as long as they remain shareholders of the Joint Venture (subject to customary exceptions).
The Raízen Shareholders’ Agreement provides that we and Shell are required to hold a prior meeting whenever a general meeting or a board of directors meeting is convened and to vote at the general meetings, or instruct our appointed representatives to the board of directors to vote at the meetings of the board of directors, in a manner consistent with the resolutions adopted at the prior meeting.
The Raízen Shareholders’ Agreement provides certain significant matters, however, will be subject to the approval of shareholders, at a prior meeting, representing at least 75% of Raízen’s capital stock, namely: (i) appointment or removal of members of the board of directors and the fiscal council or establishment of the fiscal council; (ii) approval of management accounts and financial statements; (iii) resolutions related to the allocation of profits during the year and the distribution of dividends or interest on equity, in accordance with the proposal submitted by the board of directors; (iv) any determination regarding the global compensation of the members of Raízen’s board of directors, executive board and fiscal council; (v) creation of any share grant plan in relation to Raízen’s shares; (vi) any amendment to or termination of the management compensation plan or any decision not to pay any amount payable to any participant in said plan; (vii) any amendment to Raízen’s bylaws or the respective document of any of its subsidiaries; (viii) any change to Raízen’s business purpose or the business purpose of any of its subsidiaries; (ix) any increase or decrease Raízen’s in our capital stock; (x) redemption, amortization, repurchase, alteration or any other form of reorganization or restructuring of Raízen’s shares or creation of additional classes of our shares; (xi) any split or reverse split of Raízen’s shares or payment of share dividends; (xii) any consolidation, spin-off or merger involving Raízen, merger of Raízen’s shares or change in its corporate type or similar transaction in any of its subsidiaries; (xiii) winding up, dissolution, bankruptcy, voluntary termination of business activities or reorganization of Raízen or its subsidiaries; (xiv) appointment or dismissal of a liquidator or member of the audit committee during any period of our liquidation or of any of Raízen or any subsidiary; (xv) resolution of any matters to which shareholder representatives have referred at a shareholders’ meeting or prior meeting; and (xvi) provided that it is put to vote at any shareholders’ meeting or prior meeting, approval of any act or transaction described in the Shareholders’ Agreement.
Unless another shareholder elects a member of Raízen’s board of directors who is not considered an independent member, we and Shell shall appoint, each, three members of our board of directors, and one of the members appointed by us must be Rubens Mello, as executive chairman of the board of directors. In addition, we and Shell shall each appoint one member considered independent, in accordance with the applicable regulations. Finally, the Raízen Shareholders’ Agreement mentions certain situations in which the voting rights of shareholders would be impaired as a result of a conflict of interest.
We also granted Shell a call option that can be exercised by Shell if a controlling company (referred to as a “Controlling Entity”) fails to (1) have a CEO for a period exceeding six months, (2) publish or prepare, as required by law, its financial statements under the terms and conditions agreed in the Joint Venture Agreement, or (3) if Cosan or a new shareholder of Cosan (referred to as a “New Cosan Shareholder”), as applicable, with respect to a joint venture entity (referred to as a “JV Entity”), fails to (i) appoint members to the executive board or (ii) propose names of candidates for the position of CEO of Raízen within the period provided for in the Shareholders’ Agreements. Lastly, there is a call option granted by us to Shell in the event of an involuntary delisting or involuntary suspension of the registration, as a publicly held company, of Cosan or any successor thereof.
In May 2021 and July 2021, we executed amendments to certain agreements in anticipation of Raízen’s initial public offering, which was completed in August 2021. As part of these amendments, the lock-up periods provided for in the applicable agreements were renewed for an additional five years from July 2021. The call and put options described above remained the same.
On July 27, 2023, we entered into the Eighth Amendment to the Shareholders’ Agreement to (i) establish the organization of the Lubricants Strategy and Operations Committee, (ii) include Cosan Nove Participações S.A. as a new party of the Shareholders’ Agreement, and (iii) reflect recently-made amendments that have been made to Raízen’s bylaws.
Radar Propriedades Agrícolas S.A. – Shareholders’ Agreement
Mansilla Participações Ltda., Teachers Insurance and Annuity Association of America, we and Radar II Propriedades Agrícolas entered into this shareholders’ agreement on August 27, 2008, amended on November 4, 2016. This shareholders’ agreement consolidates Radar’s shareholders resolutions about share control, transfer of shares, preemption rights, tag‑along and the right to appoint the members of the board of directors. Subject to certain exceptions, corporate resolutions must be approved by shareholders representing a majority of the voting shares.
We, Mansilla Participações Ltda., and Radar II Propriedades Agrícolas entered into a new shareholders’ agreement on November 3, 2021. This shareholders’ agreement consolidates Radar’s shareholders resolutions about shareholders meetings, conditions of future property investments by Radar, transfer of shares, preemption rights, tag‑along, right of first offer (on the sale of certain investments), buy/sell right, the right to appoint the members of the board of directors and conditions of approval of some matters by the board of directors. Subject to certain exceptions, corporate resolutions must be approved by shareholders representing a majority of the voting shares.
Radar II Propriedades Agrícolas S.A. – Shareholders Agreement
The shareholders’ agreement of Radar II Propriedades Agrícolas S.A. was executed by and among Mansilla Participações Ltda., Teachers Insurance and Annuity Association of America, a New York Corporation and us on September 28, 2012, amended on November 4, 2016. This Shareholders Agreement covered Radar II’s shareholders resolutions about share control, transfer of shares, preemption rights, tag‑along and the right to appoint the members of the Board of Directors. Except for certain relevant decisions, the corporate resolutions were to be adopted by shareholders representing the majority of the voting shares.
We and Mansilla Participações Ltda. entered into a new shareholders’ agreement on November 3, 2021. This shareholders’ agreement covers Radar II’s shareholders resolutions about shareholders meetings, conditions of future property investments, Radar II’s voting rights in Radar I and of the group companies, transfer of shares, preemption rights, tag‑along, right of first offer (on the sale of certain investments), buy/sell right, the right to appoint the members of the board of directors and conditions of approval of some matters by the board of directors. Subject to certain exceptions, the corporate resolutions shall be adopted by shareholders representing the majority of the voting shares.
Rumo S.A. – Shareholders’ Agreement
Cosan Logística and Mrs. Julia Dora Antonia Koranyi Arduini entered into the Arduini Shareholders’ Agreement on November 28, 2016. On December 31, 2016, Rumo Logística was merged into its wholly owned subsidiary Rumo S.A., and on January 22, 2021, Cosan Logística was merged into Cosan S.A. As a result, the current parties to the Arduini Shareholders’ Agreement are Rumo S.A. (as the successor entity to Rumo Logística), Cosan S.A. (as the successor entity to Cosan Logística), and Mrs. Julia Arduini.
The Arduini Shareholders’ Agreement defines the terms and conditions that govern the relationship between the parties to the agreement, in particular with respect to: (1) the election of members of our board of directors; (2) the restrictions on the sale and transfer of our shares; and (3) voting arrangements for our shareholders, general meeting and board of directors meeting. The Arduini Shareholders’ Agreement will remain in force for 10 years from November 28, 2016 and may be terminated early if Mr. Rubens Mello leaves the position of chairman of our board of directors or if Julia Arduini’s interest in the company decreases by 50% after the three-year lock-up period on the transfer of shares to which the parties are subject. In addition, the Arduini Shareholders’ Agreement states that our shareholders and board of directors’ meetings will be preceded by preliminary meetings between the parties to the Arduini Shareholders’ Agreement, which shall determine the voting instructions for their representatives at those meetings, who shall vote together as a block.
Tellus Brasil Participações S.A. – Shareholders’ Agreement
The Shareholders Agreement of Tellus Brasil Participações S.A., executed by and among TIAA-CREF Global Agriculture LLC, Nova Gaia Brasil Participações Ltda., Terraviva Brasil Participações Ltda., Radar Propriedades Agrícolas S.A., and us on July 1, 2011, amended on December 20, 2013, December 21, 2014 and October 20, 2022. This Shareholders Agreement consolidates Tellus’ shareholder resolutions about corporate capital and share control, corporate governance, redemption right, put option, transfer of shares, preemption rights, tag‑along, Cosan’s right of first refusal (on the sale of investment), noncompetition provisions and right to appoint the members of the Board of Directors. Except for certain reserved matters, corporate resolutions must be approved by shareholders representing a majority of the voting shares.
Janus Brasil Participações S.A. – Shareholders’ Agreement
The Shareholders Agreement of Janus Brasil Participações S.A., executed by and among TIAA-CREF Global Agriculture II LLC, Helios Brasil Participações Ltda., Iris Brasil Participações Ltda., Radar Propriedades Agrícolas S.A. and us on September 23, 2014, amended on October 20, 2022. This Shareholders Agreement consolidates Janus’ shareholder resolutions about corporate capital and share control, corporate governance, redemption right, put option, transfer of shares, preemption rights, tag‑along, Cosan’s right of first refusal (on the sale of investment), noncompetition provisions and the right to appoint the members of the Board of Directors. Except for certain reserved matters, corporate resolutions must be approved by shareholders representing a majority of the voting shares.
Duguetiapar Empreendimentos e Participações S.A. e Gamiovapar Empreendimentos e Participações S.A. – Shareholders’ Agreement
The Shareholders’ Agreement of Duguetiapar Empreendimentos e Participações S.A., or “Duguetiapar,” and Gamiovapar Empreendimentos e Participações S.A., or “Gamiovapar,” executed by and among TIAA-CREF Global Agriculture LLC, Nova Gaia Brasil Participações Ltda., Terraviva Brasil Participações Ltda., Radar II Propriedades Agrícolas S.A. and us on October 20, 2022, or the “Duguetiapar and Gamiovapar Shareholders’ Agreement.” The Duguetiapar and Gamiovapar Shareholders’ Agreement consolidates, as between Duguetiapar and Gamiovapar, the rules applicable to corporate share capital and control, corporate governance, redemption rights, put options, transfer of shares, preemption rights, tag-along rights, Cosan’s right of first refusal in potential asset sales, noncompete clauses and the right to appoint certain members of the boards of directors of Duguetiapar and Gamiovapar. Except where a qualified quorum is required by the constitutive documents of each company and/or the Duguetiapar and Gamiovapar Shareholders’ Agreement, corporate resolutions shall be adopted by shareholders representing the majority of voting shares.
Brado Logística e Participações S.A. – Shareholders’ Agreement
The shareholders’ agreement of Brado Logística e Participações S.A., or “Brado,” was entered into by and among Fundo de Investimento do Fundo de Garantia do Tempo de Serviço- FI-FGTS, or “FI-FGTS,” Logística Brasil-Fundo de Investimento em Participações, Deminvest Empreendimentos e Participações S.A., Markinvest Gestão de Participações Ltda., or the “Original Shareholders,” and Brado Holdings S.A., with the intervention of Brado Logística Participações S.A., Brado Logística S.A. and ALL-América Latina Logística S.A. (current Rumo S.A.) on August 5, 2013. This shareholders’ agreement resolutions about share control, transfer of shares, preemption rights, tag‑along and the right to appoint the members of the board of directors. The shareholders’ agreement also provides that certain reserved matters are subject to a right of veto on the part of the signatories. We are not a party to this Agreement. This Agreement is the object of an ongoing confidential arbitration procedure.
Cosan Lubes Investments Limited – Shareholders’ Agreement
On March 29, 2019, we entered into a shareholders’ agreement in relation to Cosan Lubes Investments Limited, or “CLI,” with Galt Lubes Investments Limited, or “Galt,” an investment vehicle managed by CVC Fund VII, or “CVC,” following Galt’s subscription for new common shares representing 30% of the share capital of CLI. This shareholders’ agreement contains the reserved matters to be voted on at the shareholder’s meeting and board of directors, lock-up provisions which restrict our ability to transfer of control of CLI for a period of five years from March 29, 2019, includes a right of first refusal for both of us and Galt and tag-along rights in the case of transfer of shares to any third party, preemption rights in the case of an issuance of new shares or other securities and provisions relating to the transfer of shares, stock option plan, noncompete and nonsolicitation, among others.
Compass – Shareholders Agreement
On May 31, 2021, we, Atmos Ilíquidos Fundo de Investimento em Ações, Atmos Master Fundo de Investimento em Ações, Manzat Inversiones Auu S.A. and Ricardo Ernesto Correa da Silva executed the shareholders agreement of Compass. The shareholders’ agreement consolidates Compass’ shareholders’ resolutions about corporate capital and share control, preferred shares rights, preferred shareholders prior meetings, provisions relating to transfer of shares, restriction to the transfer of Compass’ shares by the preferred shareholders for a three‑year period (except for the permitted transfers provided in the shareholders agreement), tag-along, preemption rights, and initial public offering conditions, if applicable. This agreement will remain in force (i) for 10 years from the signing date or (ii) until financial settlement of any initial public offering of the company, if applicable.
On September 4, 2021, we, Bradesco Vida e Previdência S.A., Nucleo Capital Ltda., BC Gestão de Recursos Ltda., and Prisma Capital Ltda. executed the shareholders agreement of Compass S.A. This shareholders’ agreement consolidates Compass’ shareholders resolutions about corporate capital and share control, preferred shares rights, preferred shareholders prior meetings, provisions relating to transfer of shares, restriction to the transfer of Compass’ shares by the preferred shareholders for a three-year period (except for the permitted transfers provided in the shareholders agreement), tag‑along, preemption rights, and initial public offering conditions, if applicable. This agreement will remain in force (i) for 10 years from the signing date or (ii) until financial settlement of any initial public offering of the company, if applicable.
Commit Gás S.A. – Shareholders Agreement
On December 28, 2015, Petróleo Brasileiro S.A. and Mitsui Gás e Energia do Brasil Ltda. entered into the shareholders’ agreement, or the “Commit Shareholders’ Agreement.” Following the acquisition of 51% of the share capital of Commit by Compass, on July 11, 2022, Compass entered into the Commit Shareholders’ Agreement substituting Petróleo Brasileiro S.A. The Commit Shareholders’ Agreement provides, among other things, for the controlling interest of Commit, dividends distribution, preferred shares rights, share transfer provisions, preemption right, call option, shareholders’ meeting, composition and decisions of the board of directors, executive officers composition and appointments, and administration of subsidiaries.
Cosan Dez Participações S.A. – Shareholders Agreement
On December 23, 2022, we and Bradesco BBI S.A. entered into a shareholder’s agreement relating to our subsidiary Cosan Dez, or the “Cosan Dez Shareholders’ Agreement.” The Cosan Dez Shareholders’ Agreement provides that Cosan Dez’s shareholders resolutions will establish share-control arrangements, preferred shares rights, distribution of profits, provisions relating to transfer of shares, lock-up period, preemption rights, call options and redemption rights. The Cosan Dez’s Shareholders’ Agreement also gives Bradesco BBI S.A. a contingent call option exercisable only upon the occurrence of certain events constituting a material adverse effect listed in the agreement. The Cosan Dez’s Shareholders’ Agreement will remain in force as long as there are outstanding preferred shares. Cosan Dez currently holds the totality of the shareholding interest Cosan previously had in Compass.
On December 23, 2022, we and Bradesco BBI S.A. entered into a voting agreement relating to the voting rights of Cosan Dez’s shareholders, or the “Cosan Dez Voting Agreement.” Cosan Dez Voting Agreement provides that shareholders’ resolutions will establish share-control arrangements, shareholders’ meeting frequency and preferred shares voting rights. Unless a qualified quorum is otherwise required, corporate resolutions shall be adopted by shareholders representing the majority of Cosan Dez’s voting shares. Cosan Dez’s Voting Agreement will remain in force until December 23, 2032.
Cosan Nove Participações S.A. – Shareholders Agreement
On December 28, 2022, we and Itaú Unibanco S.A. entered into a shareholders’ agreement relating to our subsidiary Cosan Nove, or the “Cosan Nove Shareholders’ Agreement.” The Cosan Nove Shareholders’ Agreement provides that shareholders resolutions will establish share-control arrangements, preferred shares rights, provisions relating to transfer of shares, distribution of profits, lock-up period, preemption rights, tag-along rights, call options, redemption rights, and our rights to appoint all of Cosan Nove’s executive officers. Unless a qualified quorum is otherwise required, corporate resolutions shall be adopted by shareholders representing the majority of the voting shares of Cosan Nove. The Cosan Nove’s Shareholders’ Agreement also gives Itaú Unibanco S.A. a contingent call option exercisable only upon the occurrence of certain events constituting a material adverse effect listed in the agreement. The Cosan Nove Shareholders’ Agreement will remain in force until December 28, 2057. Cosan Nove currently holds part of the shareholding interest that Cosan previously held in Raízen.
Radar Gestão de Investimentos S.A. – Shareholders Agreement
The shareholders agreement of Radar Gestão de Investimentos S.A., was executed by and among Nuveen Natural Capital Latam Gestora de Ativos Ltda. and us on March 1, 2024. This shareholders agreement provides, among another things, for the following matters to be decided unanimously by both shareholders: the composition of the board of directors and the board of officers and their respective powers, the annual budget, dividends distribution, restrictions on transfers of shares, lock-up rights, right of first refusal, tag along and exit right. The Radar Gestão de Investimentos S.A.’s shareholders agreement will remain in force until 2044.
We engage in related party transactions with certain of our affiliates, some of which are of a recurring nature. Financial information with respect to certain material related party transactions is set forth in note 5.8 to our audited consolidated financial statements included elsewhere in this annual report.
Our board of directors delegates to the audit committee the responsibility for reviewing and approving the related party transactions in accordance with our policy on transactions with related parties (within the meaning of Item 404 of Regulation S-K of the SEC).The audit committee is responsible for obtaining information from our directors, executive officers and major shareholders with respect to related party transactions and for then determining, based on the facts and circumstances, whether our company or a related party has a direct or indirect material interest in the transaction. As required under SEC rules, transactions that are determined to be directly or indirectly material to our company or a related party has been disclosed herein.
In the normal course of business, we have operational and financing transactions with related parties. The significant related party balances and transactions are described in note 5.8 to our audited consolidated financial statements included elsewhere in this annual report.
See “Item 18. Financial Statements.”
Legal Proceedings
We are party to numerous legal proceedings, the most relevant of which are further described below.
Probable Losses
In the ordinary course of our business, we are party to a number of legal proceedings for which we deem the risk of loss as probable and for which we have recorded provisions for legal proceedings in an aggregate amount of R$2,058.1 million as of December 31, 2025 and R$2,044.6 million as of December 31, 2024. Provisions relating to probable losses are categorized into tax, civil, environmental, regulatory, and labor matters, as described below.
Tax. We recorded provisions of R$694.5 million and R$745.9 million for tax proceedings involving probable risk of loss as of December 31, 2025 and December 31, 2024, respectively. The principal tax proceedings for which the risk of loss is probable are described below:
Civil, regulatory, environmental and other claims. We, our subsidiaries, and our jointly controlled entities are parties to a number of civil legal claims related to (1) indemnity for material and moral damages; (2) termination or litigation in connection with different kinds of agreements; (3) public civil claims related to sugarcane stubble burning; (4) environmental matters; and (5) compliance with certain conduct adjustment agreements and other matters. Provisions for civil, regulatory, and environmental claims as of December 31, 2025 amounted to R$907.2 million and R$818.4 million as of December 31, 2024. As of December 31, 2025, R$182.8 million in judicial deposits were made for civil and environmental claims, and this figure was R$134.1 million as of December 31, 2024. Cosan S.A., its subsidiaries, and its jointly controlled entities are also parties to a number of regulatory legal proceedings related to (1) the collection of fines by the ANTT, (2) disputes regarding the tariff ceiling imposed by the ANTT, and (3) certain other matters.
Labor claims. We, our subsidiaries, and our jointly controlled entities are also parties to a number of labor claims filed by former employees and service providers challenging, among other matters, the payment of overtime, night shift premiums, and risk premiums, the recognition of employment relationships, and the reimbursement of payroll deductions, such as social contributions and trade union charges. Additionally, we are involved in several labor administrative and judicial proceedings, such as labor investigations and class actions filed by the Labor Prosecutor’s Office, regarding alleged non‑compliance with certain labor regulations, including work and safety rules, labor conditions and the work environment, and social assistance plans. Moreover, we have entered into certain consent orders (Termos de Ajustamento de Conduta) with Brazilian authorities, and in the event we fail to comply with such consent orders, we could be subject to fines. Provisions for labor claims as of December 31, 2025 and 2024 amounted to R$456.4 million and R$480.3 million, respectively, while judicial deposits for labor claims amounted to R$120.8 million and R$120.9 million as of December 31, 2025 and 2024, respectively.
Possible Losses
In addition, there are currently certain legal proceedings pending in which we are involved for which we have not recorded provisions, as we deem the likelihood of loss as possible. If adverse decisions are rendered against us in any of these legal proceedings, our results of operations or financial condition could be materially and adversely affected. The aggregate amount involved in proceedings for which our risk of loss has been deemed possible as of December 31, 2025 totaled R$16,072.2 million, of which R$8,393.0 million, R$6,864.9 million, and R$814.4 million were related to tax, civil, environmental and regulatory, and labor claims, respectively. The principal proceedings for which we deem the risk of loss as possible are described below:
Certain Tax Proceedings
We are parties to certain other tax proceedings, including the following principal proceedings:
Judicial Deposits
In accordance with court orders concerning certain tax, civil, and labor lawsuits, we had bank judicial deposits in an aggregate amount of R$1,073.0 million as of December 31, 2025.
Criminal Proceedings
Criminal Environmental Claims
Cosan and its subsidiaries are parties to nine criminal environmental lawsuits and are being investigated in certain environmental police inquiries in process in the states of São Paulo, Pará, Rio Grande do Sul, Mato Grosso do Sul, Paraná, Rio de Janeiro, Minas Gerais, Bahia, Pernambuco and Santa Catarina. The main crimes alleged to have been committed are noise pollution, contamination of soil and rivers, burning, deforestation of native forest, emission of pollutants into the atmosphere and irregular transportation of dangerous products.
CLE is party to a criminal proceeding commenced by the Public Prosecutor’s Office of Pará for the alleged environmental crime of pollution. In March 2017, a decision was rendered recognizing that the statute of limitations had expired against the Public Prosecutor’s Office claim against CLE. The prosecution filed an appeal and the court of appeals has granted continuance of the proceedings. In addition to the application of fines, imposition of penalties that restrict certain rights, such as the suspension of activities or prohibition to enter into contracts with public authorities. With the recommencement of the criminal proceeding, a petition was filed requesting that the court rule on the legal arguments presented in the defense’s reply to the charges and, subsidiarily, in the event the indictment is accepted, to stay the criminal proceeding until the conclusion of the civil public action. CLE filed a petition informing the court of the court-approved settlement reached in the related public civil action, which expressly recognizes the absence of any criminal conduct attributable to Cosan, thereby reinforcing the request for dismissal of the indictment pursuant. The Public Prosecutor’s Office submitted a statement reaffirming the charges and requesting the continuation of the proceedings, including the scheduling of a trial hearing. The risk of loss has been classified as possible.
Criminal Proceedings Involving Members of Our Management
Certain members of our management are parties to criminal proceedings, as follows:
Mr. Rubens Mello and Mr. Marcelo Martins
Mr. Rubens Mello and others were named as defendants in a criminal complaint filed on October 29, 2014 to determine whether they have committed tax evasion in connection with the alleged failure to adequately pay state value added taxes (ICMS). The determination as to whether outstanding taxes are in fact due is at issue in a separate tax collection enforcement proceeding that is independent of the criminal proceeding. Bank letters of credit and insurance guarantees have been deposited with the relevant court to secure the amount in controversy. Given the fact that the crime of tax evasion requires there to be an actual loss to the tax authorities, such deposits have generally been interpreted by the Brazilian courts to eliminate criminal liability given that there would no longer exist a direct or indirect risk of harm to the public treasury and the allegedly illicit conduct of the defendants would no longer constitute a crime. This understanding, however, may change depending on the judge’s final decision. In view of the foregoing, the defense filed a motion requesting that the criminal proceedings (which are currently suspended) be terminated for lack of cause. As of the date of this annual report, this criminal proceeding is stayed and awaiting final judgment of a motion to stay enforcement of the related tax proceedings. In the opinion of counsel responsible for the defense, the likelihood of a decision favorable to the defendants is possible. In any event the payment of the amounts due would be sufficient to extinguish criminal liability.
Mr. Rubens Mello and Mr. Marcelo Eduardo Martins were named as defendants in a criminal complaint filed by the prosecutors of the State of Rio de Janeiro on May 16, 2019, in their capacities as executive officers of Nova América S/A Comercial to determine whether they have committed tax evasion in connection with the alleged failure to adequately pay state value-added taxes (namely ICMS). The determination as to whether outstanding taxes are in fact due is at issue in a separate tax collection enforcement proceeding that is independent of the criminal proceeding. Bank letters of credit and insurance guarantees have been deposited with the relevant court to secure the amount in controversy. Given the fact that the crime of tax evasion requires there to be an actual loss to the tax authorities, such deposits have generally been interpreted by the Brazilian courts to eliminate criminal liability given that there would no longer exist a direct or indirect risk of harm to the public treasury and the allegedly illicit conduct of the defendants would no longer constitute a crime. This understanding, however, may change depending on the judge’s final decision. In February 2024, the Court confirmed the previously decision that the criminal proceedings will be suspended until the final decision in motion to stay execution on tax sphere. In the opinion of counsel responsible for the defense, the likelihood of a decision favorable to the defendant is possible.
Mr. Martins and Mr. Mello, together with other individuals, are named defendants in their capacities as executive officers and accountants of Nova América S/A Comercial, in certain criminal complaints filed by the prosecutors of the State of Rio de Janeiro in connection with the alleged commission of crimes against the tax order related to the alleged failure to adequately pay state value-added taxes (ICMS) by Nova América. Mr. Martins and Mr. Mello and the other defendants were summoned and presented their defenses. In December 2021, the court ruled that the criminal complaint be suspended until the final decision in the motion to stay execution on the tax proceedings. As a result, this proceeding is currently stayed. In the opinion of the counsel responsible for the defense, the likelihood of a decision favorable to the defendant is possible.
Legal Proceedings of the Joint Venture
In addition, the Raízen Joint Venture is also party of certain legal proceedings as described under “Item 4. Information on the Company—E. Supplemental Information About Joint Venture—Legal and Administrative Proceedings of the Joint Venture.”
Dividends and Dividend Policy
Dividend Rights
The Brazilian Corporation Law and Cosan S.A.’s bylaws require that we distribute annually to our shareholders a mandatory minimum dividend, unless our board of directors notifies the shareholders that such distribution is not advisable in light of our financial condition as reflected in our consolidated financial statements. The basis of the mandatory dividend is a percentage of the net income, as adjusted pursuant to the Brazilian Corporation Law. Under our bylaws, a minimum of 25% of our adjusted net income should be intended for distribution and payment to our shareholders as mandatory dividend. However, the payment of mandatory dividends to our shareholders may be limited to the amount of realized net income in a given year, provided the difference is recorded as an unrealized income reserve.
We are required by the Brazilian Corporation Law and our bylaws to hold an annual shareholders’ meeting no later than four months after the end of each fiscal year, at which time the allocation of the results of operations in any year and the distribution of an annual dividend are reviewed. The distribution of annual dividends is based on our audited consolidated financial statements prepared for the immediately preceding fiscal year.
Additionally, pursuant to the Brazilian Corporation Law and Cosan S.A.’s bylaws, interim and extraordinary dividends may be distributed to our shareholders by decision of our board of directors, to be confirmed by the shareholders’ meeting. Amounts paid as interim and extraordinary dividends are included in the calculation of the minimum mandatory dividend provided for in the Brazilian Corporation Law and Cosan S.A.’s bylaws.
Calculation of Adjusted Net Income
At each annual shareholders’ meeting, our board of directors is required to recommend how to allocate our net income for the preceding fiscal year, which recommendation our board of executive officers initially submits to our board of directors for approval.
This allocation is subject to approval by our common shareholders. The Brazilian Corporation Law defines “net income” for any fiscal year as our profit after income taxes for that fiscal year, net of any accumulated losses from prior fiscal years and any amounts allocated to employees’ participation in our profit in that fiscal year. Under the Brazilian Corporation Law, our adjusted net profit available for distribution are equal to our net profit in any fiscal year, reduced by amounts allocated to our legal reserve and other applicable reserves, and increased by any reversals of reserves that we constituted in prior years.
Reserve Accounts
Under the Brazilian Corporation Law and our bylaws, we are required to maintain a legal reserve. In addition, we are permitted by the Brazilian Corporation Law to establish the following discretionary reserves:
Allocations to each of these reserves (other than the legal reserve) are subject to approval by our common shareholders voting at our annual shareholders’ meeting.
The Brazilian Corporation Law provides that the legal reserve and the tax incentive investment reserve may be credited to shareholders’ equity or used to absorb losses, but these reserves are unavailable for the payment of distributions in subsequent years.
The amounts allocated to the other reserves may be credited to shareholders’ equity and used for the payment of distributions in subsequent years.
We expect to have sufficient available cash to pay dividends in accordance with our dividend policy. We do not, however, plan to pay dividends in the event that we do not generate sufficient cash from operations. In addition, we will not pay dividends if we believe that such payment will limit or preclude our or our subsidiaries’ ability to pursue growth opportunities. Although our bylaws do not restrict us from borrowing funds to pay dividends, we do not intend to borrow funds to pay dividends.
Any cash dividends payable to holders of our ADSs quoted on the NYSE will be paid to J.P. Morgan Chase Bank, N.A., our transfer agent in the United States, for disbursement to those holders.
Joint Venture’s Dividend Policy
The shareholders’ agreement between us and Shell also establish the dividend policy of the Joint Venture. The dividend policy states that the Joint Venture seeks to maximize the amount of profits to be distributed to its shareholders in a manner consistent with its leverage ratio objectives and capital investment requirements. The supervisory boards must propose, and the shareholders approve, an allocation of the net profit of the Joint Venture in accordance with the shareholders’ agreements. The shareholders’ agreements provide that net profit is subject to the following allocation order:
Our common shares became listed on the B3 and began trading under the symbol “CSAN3” on November 18, 2005. Our ADSs began trading on the NYSE under the symbol “CSAN” on March 8, 2021. On March 18, 2026, there were 3,966,570,932 common shares issued and outstanding (excluding 57,764,410 common shares held in treasury), of which 81,472,200 (representing 325,888,801 common shares) were represented by ADSs outstanding, which is equivalent to 8.22% of our total outstanding shares. On March 18, 2026, we had approximately 145,280 shareholders, including approximately 139 registered U.S. resident holders of our common shares listed on the B3.
Our common shares are listed on the B3 and trade under the symbol “CSAN3” and our ADSs are listed on the NYSE and trade under the symbol “CSAN.” For further information, see “Item 9. The Offer and Listing—A. Offer and Listing Details.”
Trading on the São Paulo Stock Exchange
Settlement of transactions conducted on the São Paulo Stock Exchange, or Brasil, Bolsa, Balcão, or the “B3,” becomes effective two business days after the trade date. Delivery of, and payment for, shares is made through the facilities of separate clearinghouses for each exchange, which maintain accounts for member brokerage firms. The seller is ordinarily required to deliver the shares to the clearinghouse of the B3 on the second business day following the trade date.
To better control volatility, the B3 has adopted a “circuit breaker” system pursuant to which trading sessions may be suspended for a period of 30 minutes or one hour whenever the indices of these stock exchanges fall below the limits of 10% and 15%, respectively, in relation to the index registered in the previous trading session.
The Brazilian securities market is substantially smaller, less liquid, more concentrated and more volatile than major securities markets in the United States and other jurisdictions, and may be regulated differently from the ways familiar to U.S. investors. There is also significantly greater concentration in the Brazilian securities market than in major securities markets in the United States. Although any of the outstanding shares of a listed company may trade on a Brazilian stock exchange, in most cases fewer than half of the listed shares are actually available for trading by the public, the remainder being held by small groups of controlling persons, governmental entities or one principal shareholder.
Trading on the B3 by non-residents of Brazil is subject to certain limitations under Brazilian foreign investment and tax legislation. See “Taxation” and “Description of Share Capital—B. Exchange Controls.”
São Paulo Stock Exchange Corporate Governance Standards
The B3 has three main listing segments:
These listing segments have been designed for the trading of shares issued by companies that voluntarily undertake to abide by corporate governance practices and disclosure requirements in addition to those already required under the Brazilian Corporation Law and the rules of the CVM. The inclusion of a company in any of these listing segments requires adherence to a series of corporate governance rules. These rules are designed to increase shareholders’ rights and enhance the quality of information provided by Brazilian corporations.
As our common shares are listed on the Novo Mercado segment of the B3, in addition to the disclosure obligations imposed by the Brazilian Corporation Law and the CVM, we also must comply with the following additional disclosure requirements set forth by the Novo Mercado rules:
No later than six months following the listing of our common shares on the Novo Mercado, we must disclose the following information together with our ITR:
The following information must also be included in our formulário de referência within seven business days of the occurrence of the following events, among others:
All members of our board of directors, our board of executive officers and our fiscal council have signed a management compliance statement (Termo de Anuência dos Administradores) under which they take personal responsibility for compliance with the Novo Mercado listing agreement, the rules of the Market Arbitration Chamber and the regulations of the Novo Mercado.
Additionally, pursuant to the Novo Mercado rules, we must, by December 10 of each year, publicly disclose and send to the B3 an annual calendar with a schedule of our corporate events. Any subsequent modification to such schedule must be immediately and publicly disclosed and sent to B3.
The following is a summary of certain significant provisions of our bylaws (estatuto social). This description does not purport to be complete and is qualified by reference to the complete text of our bylaws and the applicable laws of Brazil. This summary should not be considered as legal advice regarding these matters. You are urged to carefully review our bylaws in their entirety as they, and not this description, will control your rights as a holder of our common shares. In this section, unless otherwise stated, references to “we,” “us,” “our,” or the “Company” refer solely Cosan S.A., excluding its subsidiaries.
Pursuant to the Novo Mercado regulations, our capital stock must consist exclusively of common shares. Cosan is a corporation (sociedade anônima) of indefinite term incorporated under the laws of Brazil, having its registered office in the city of São Paulo, State of São Paulo, at Avenida Brigadeiro Faria Lima, 4,100 – 16th floor, room 1, ZIP Code 04538-132, Brazil, enrolled with the Brazilian taxpayers’ registry (Cadastro Nacional de Pessoas Jurídicas – CNPJ) under No. 50.746.577/0001-15. Cosan was incorporated on July 8, 1966. Cosan is governed by the laws of Brazil, as well as by our bylaws.
Capital Stock
As per Article 5 of our bylaws, the capital stock of Cosan, fully subscribed and paid in, is R$10,282.7 million, divided into 3,966,570,932 registered common shares with no par value. The capital stock of Cosan will be represented solely by common shares, and each common share will be entitled to one vote on the resolutions to be adopted by the shareholders.
Cosan is authorized to increase its capital stock, regardless of an amendment to our bylaws, by up to 8,000,000,000 shares, upon a resolution of its board of directors, which will establish the terms of issuance, including the price and payment. The board of directors may also approve the issuance of warrants (“bonus de subscrição”) and convertible debentures, as well as the capitalization of profits and reserves, whether or not by issuing bonus shares, within the limits of the authorized capital.
The board of directors of Cosan may grant stock purchase or subscription options, under the plan or programs approved at the shareholders’ meeting, to the managers and employees of Cosan, as well as to managers and employees of other companies directly or indirectly controlled by Cosan, without preemptive rights to the shareholders at the time of either grant or exercise of such options, subject to the balance of the authorized capital limit at the time of exercise of subscription options, analyzed together with the balance of treasury shares at the time of exercise of purchase options.
Corporate Purpose
As per Article 3 of the our bylaws, our corporate purposes are to (1) import, export, produce and trade sugar, ethanol, sugarcane, and other sugar byproducts; (2) distribute fuels in general and trade oil byproducts; (3) establish fuel supply stations, purchase and sell oil-derived fuels and lubricants; (4) provide logistics and port services, as well as technical, administrative and financial advisory services; (5) any type of transportation of passengers and cargo, including inland navigation, river and lake ferries; (6) produce and trade electricity, live steam, steam escape and other electricity co-generation byproducts; (7) farming and livestock activities in proprietary or third-party-owned lands; (8) import, export, handle, trade, produce, store, load or unload fertilizers and other agricultural inputs; (9) manage on its own account or through third parties assets and property and may lease, receive and grant in partnership, rent and lease furnishings, properties and equipment in general; (10) render technical services related to the activities mentioned above; (11) hold equity interest in other companies; and (12) processing and trading of fuel gases.
The development of activities by the companies that Cosan holds direct or indirect interest in any type considers the following factors: (1) the short- and long-term interests of Cosan and its shareholders, and (2) the short and long‑term economic, social, environmental and legal effects on its employees, suppliers, partners, clients and other creditors, as well as on the communities in which Cosan operates, both locally and globally.
Dividends
Our bylaws require that we distribute annually to our shareholders a mandatory minimum dividend, which we refer to as the mandatory dividend, equal to at least 25% of our profit (loss) after taxes, after certain deductions, including accumulated losses and any amounts allocated to employee and management participation, any amount allocated to our legal reserve, any amount allocated to our special reserve, any amount allocated to the contingency reserve and any amount written off with respect to the contingency reserve accumulated in previous fiscal years, in each case in accordance with Brazilian law.
However, the Brazilian Corporation Law permits a company to suspend the mandatory distribution of dividends if its board of directors reports to the shareholders’ meeting that the distribution would be incompatible with the financial condition of the company, subject to approval by the shareholders’ meeting and review by the fiscal council. In addition, our management must submit a report to the CVM clarifying the reasoning for any such non-payment. Profit (loss) not distributed due to such a suspension must be attributed to a separate reserve and, if not absorbed by subsequent losses, must be paid as dividends as soon as the financial situation of the company permits.
The amounts available for distribution are determined on the basis of financial statements prepared in accordance with the requirements of the Brazilian Corporation Law. In addition, amounts arising from tax incentive benefits or rebates are appropriated to a separate capital reserve in accordance with the Brazilian Corporation Law. This investment incentive reserve is not normally available for distribution, although it can be used to absorb losses under certain circumstances or be capitalized. Amounts appropriated to this reserve are not available for distribution as dividends.
The Brazilian Corporation Law permits a company to pay interim dividends out of preexisting and accumulated profits for the preceding fiscal year or semester, based on financial statements approved by its shareholders. We may prepare financial statements semiannually or for shorter periods. Our board of directors may declare a distribution of dividends based on the profits reported in semiannual financial statements. Our board of directors may also declare a distribution of interim dividends or interest based on profits previously accumulated or in profits reserve, which are reported in such financial statements or in the last annual financial statement approved by resolution taken at a shareholders’ meeting. The board of directors may also declare dividends based on financial statements prepared for interim periods; provided that the total amount of dividends paid in each semester does not exceed the amounts accounted for in our capital reserve account set forth in paragraph 1 of Article 182 of the Brazilian Corporation Law and any dividends that fail to be claimed within a period of three years will revert to Cosan.
In general, Non-Resident Holders must register their equity investment with the Central Bank of Brazil to have dividends, sales proceeds or other amounts with respect to their shares eligible to be remitted outside of Brazil. The common shares underlying the Cosan ADSs are held in Brazil by the custodian, as agent for the Depositary, which is the registered owner on the records of the registrar for our shares.
Payments of cash dividends and distributions, if any, are made in reais to the custodian on behalf of the Depositary, which then converts such proceeds into U.S. Dollars and causes such U.S. Dollars to be delivered to the Depositary for distribution to holders of Cosan ADSs. In the event that the custodian is unable to convert immediately the foreign currency received as dividends into U.S. dollars, the amount of U.S. dollars payable to holders of Cosan ADSs may be adversely affected by devaluations of the Brazilian currency that occur before the dividends are converted. Under the Brazilian Corporation Law, dividends paid to Non-Resident Holders will not be subject to Brazilian withholding tax; however, it is not clear under Brazilian law whether such withholding income tax exemption is also applicable to dividends distributed to holders of Cosan ADSs abroad.
Brazilian law allows the payment of dividends solely in reais, limited to the unappropriated retained earnings in our financial statements prepared in accordance with IFRS Accounting Standards.
Rights of Holders of Common Shares
Each of our common shares entitles its holder to one vote per common share at our annual or extraordinary general shareholders’ meetings (assembleia geral ordinária or assembleia geral extraordinária). Pursuant to our bylaws and its B3 listing agreement in connection with the listing of the common shares on the Novo Mercado, we cannot issue shares without voting rights or with restricted voting rights. As long as we are listed on the Novo Mercado, we may not issue preferred shares. In addition, our bylaws and the Brazilian Corporation Law provide that holders of common shares of Cosan are entitled to dividends or other distributions made in respect of common shares of Cosan in accordance with their respective participation in Cosan’s capital. See “—Dividends.” In addition, in the event of our liquidation and following the payment of all our outstanding liabilities, holders of common shares of Cosan are entitled to receive their pro rata interest in any remaining assets, in accordance with their respective participation in our capital. The shareholders have preemptive rights to subscribe for new shares issued by us, pursuant to the Brazilian Corporation Law, but are not obligated to subscribe for future capital increases.
Pursuant to the Novo Mercado Rules and the Brazilian Corporation Law, common shares of Cosan have tag-along rights which enable their holders, upon the sale of a controlling interest in us, to receive in exchange for their shares 100% of the price paid per common share for the controlling block.
Pursuant to the Brazilian Corporation Law, neither our bylaws nor actions taken at a shareholders’ meeting may deprive a shareholder of: (1) the right to participate in the distribution of net income; (2) the right to participate equally and proportionally in any residual assets in the event of liquidation of our company; (3) preemptive rights in the event of issuance of new shares, convertible debentures or subscription warrants, except in some specific circumstances under the Brazilian Corporation Law; (4) the right to hold our management accountable in accordance with the provisions of the Brazilian Corporation Law; and (5) the right to withdraw from us in the cases specified in the Brazilian Corporation Law, including merger or consolidation, which are described in “—Right of Withdrawal” and “—Redemption.”
Neither our bylaws, nor the Brazilian Corporation Law, contain any restriction on voting by Non-Resident Holders of common shares of Cosan.
Pursuant to our bylaws, every shareholder, group of shareholders or holders of ADSs that holds, acquires or becomes the owner, directly or indirectly, of 2.5%, 5.0%, 7.5% or 10.0% (and successively upon 2.5% increments) or more of the total shares of our capital stock, is required to inform us of the total amount of shares, or rights of shares, owned.
Public Tender Offer upon Sale of Control
The direct or indirect disposal of controlling interest in Cosan in a single transaction or series of successive transactions must be agreed upon under a condition that the acquirer will make a tender offer to purchase the shares issued by Cosan and owned by the remaining shareholders, subject to the terms of, and within the time limits prescribed by, prevailing regulation and legislation and the Novo Mercado Regulation, so that the holders of such remaining shares may receive the same treatment as accorded to the seller pursuant to Article 254-A of the Brazilian Corporation Law and Articles 37 and 38 of the Novo Mercado Rules and Article 36 of our bylaws.
Our Bylaws contain a provision stating that any shareholder that acquires or becomes the owner, directly or indirectly, of our capital stock corresponding to 10%, until January 31, 2028, and 15% as from February 1, 2028, or more of the total shares of our capital stock, whether by means of a single transaction or through several transactions, must make or apply for registration of, as the case may be, a tender offer to purchase all shares of our capital stock of Cosan, subject to the provisions of the applicable regulations issued by the CVM and Novo Mercado Regulation and Article 37 of our bylaws.
Allocation of Net Income
Together with the financial statements for the fiscal year, the board of directors will submit to the Annual Shareholders’ Meeting the proposed allocation of net income, in compliance with the provisions of law and Cosan Bylaws.
The shareholders will be entitled to receive as dividends each year a mandatory minimum percentage of twenty five percent (25%). Pursuant to Brazilian Corporation Law, our net income may be allocated to income reserves and to the distribution of dividends. For purposes of Brazilian Corporation Law, net income is defined as a period’s result minus accumulated losses from previous years, income and social contribution tax provisions and any other amounts allocated for the payment of profit sharing authorized in our bylaws to employees and management.
Under the Brazilian Corporation Law, payment of the mandatory dividend is not required if the board of directors has formally declared such distribution to be inadvisable in view of our financial condition and has provided the shareholders at the annual general shareholders’ meeting with an opinion to that effect, which has been reviewed by our fiscal council. In addition, our management must submit a report to the CVM within five days following said meeting clarifying the reasoning for any such non-payment. See “—Dividends.”
Preemptive Rights
Our shareholders have a general preemptive right to subscribe for our shares in any capital increase of the same class of shares owned by them, pro rata to their interest in our capital stock at the time of the capital increase, except in the event of a grant or assignment of any option to acquire or subscribe to our common shares.
While our shareholders also have preemptive rights to subscribe for convertible debentures and subscription warrants, no preemptive rights apply to actual conversions of debentures, acquisitions of common shares from subscription of warrants and the offer and exercise of call options. In accordance with Brazilian Corporation Law, a period of at least 30 days following the publication of a notice of issuance of shares, convertible debentures or subscription warrants is granted for the exercise of preemptive rights, which rights may be transferred or disposed of for value. However, in accordance with Article 172 of Brazilian Corporation Law, our board of directors may refuse the granting of preemptive rights, or reduce the exercise period, with respect to the issue of new shares, convertible debentures and subscription warrants, up to the maximum limit of our authorized capital stock, if the placement of those shares, debentures or warrants occurs through a stock exchange sale or a public offering, in a public tender offer, with the objective of acquiring control of another company.
Our shareholders are not entitled to preemptive rights to subscribe for our shares or our subscription bonus issued and placed through the trade on a stock exchange or a public subscription or the acquisition of shares made in the context of a public offer for acquisition of control.
Arbitration
In accordance with the regulations of the Novo Mercado and our bylaws, Cosan, its shareholders, executive officers, directors and fiscal council members are required to resolve through arbitration any disputes or controversies, including those related to or arising out of the application, validity, effectiveness, interpretation and violation, among others, of the provisions of the Brazilian Corporation Law, Law No. 6,385/76, our bylaws, the rules published by the CMN, the Central Bank of Brazil, the CVM and other rules applicable to the Brazilian capital markets in general, as well as those set forth in the Novo Mercado Listing Regulations, in the Novo Mercado Listing Agreement and in other rules issued by the B3, and such arbitration is the exclusive means to settle such disputes with Cosan’s shareholders. As the holders of Cosan ADSs are not direct shareholders of Cosan, these arbitration requirements do not apply to such Cosan ADS holders; however, because the Depositary is a holder of common shares of Cosan, it would be bound by these mandatory arbitration provisions if it sought to exercise remedies against Cosan under Brazilian law.
Liquidation
Cosan shall be liquidated upon the occurrence of certain events provided for in the Brazilian Corporation Law, whereupon a meeting of the shareholders shall determine the form of liquidation, electing the liquidator(s) and the members of our fiscal council, which must operate on a mandatory basis during the liquidation period.
Redemption
According to the Brazilian Corporation Law, we may redeem common shares of Cosan subject to the approval of our shareholders at an extraordinary shareholders’ meeting where shareholders representing at least 50% of the shares that would be affected are present. The share redemption may be paid with our retained earnings, income reserves or capital reserves, with the exception of the legal reserve.
If the share redemption is not applicable to all shares, the redemption will be made by lottery. If custody shares are picked in the lottery and there are no rules established in the custody agreement, the financial institution will specify, on a pro rata basis, the shares to be redeemed.
Right of Withdrawal
The Brazilian Corporation Law provides that, in case any of our shareholders dissent from certain decisions taken at a shareholders’ meeting, they have the right to withdraw its equity interest from the company and to receive payment for the portion of shareholders’ equity attributable to its equity interest.
Pursuant to Brazilian Corporation Law, shareholder withdrawal rights may be exercised under the following circumstances, among others:
In addition, in the event that the entity resulting from incorporação de ações, or a merger of shares, a consolidation or a spin-off of a listed company fails to become a listed company within 120 days of the shareholders’ meeting at which such decision was taken, the dissenting or non-voting shareholders may also exercise their withdrawal rights.
Only holders of shares adversely affected by the changes mentioned in the first and second items above may withdraw their shares. The right of withdrawal lapses 30 days after publication of the minutes of the relevant shareholders’ meeting. We would be entitled to reconsider any action giving rise to withdrawal rights within 10 days following the expiration of such rights if the withdrawal of shares of dissenting shareholders would jeopardize Cosan’s financial condition.
The Brazilian Corporation Law allows companies to redeem their shares at their economic value, subject to certain requirements. Since our bylaws currently do not provide that our shares be subject to withdrawal at their economic value, our shares would be subject to withdrawal at their book value, determined on the basis of the last balance sheet approved by the shareholders. If the shareholders’ meeting giving rise to withdrawal rights occurs more than 60 days after the date of the last approved balance sheet, a shareholder may demand that its shares be valued on the basis of a new balance sheet that is of a date within 60 days of such shareholders’ meeting. In this case, Cosan must immediately pay 80% of the net worth of the shares, calculated on the basis of the most recent statement of financial position approved by its shareholders, and the balance must be paid within 120 days after the date of the resolution of the shareholders’ meeting.
Pursuant to the Brazilian Corporation Law, in events of consolidation, merger, incorporation of shares, participation in a group of companies, and acquisition of control of another company, the right to withdraw does not apply if the shares meet certain tests relating to liquidity and dispersal of the type or class of shares on the market (they are part of the B3 Index or other stock exchange index (as defined by the CVM)). In such cases, shareholders will not be entitled to withdraw their shares if the shares are a component of a general securities index in Brazil or abroad admitted to trading on the securities markets, as defined by the CVM, and the shares held by persons unaffiliated with the controlling shareholder represent more than half of the outstanding shares of the relevant type or class.
Registration of Shares
The common shares of Cosan are held in book-entry form with Itaú Corretora de Valores S.A. Transfer of the common shares of Cosan is carried out through a debit entry on the seller’s account and a credit entry on the purchaser’s account upon (1) written request of the seller; or (2) judicial order or authorization.
Form and Transfer
Because the common shares of Cosan are in registered book-entry form, the transfer of shares is made under Article 35 of the Brazilian Corporation Law, which determines that a transfer of shares is effected by an entry made by the registrar, by debiting the share account of the transferor and crediting the share account of the transferee. Itaú Corretora de Valores S.A. performs safe keeping, share transfer and other related services for us.
Transfers of shares by a foreign investor are made in the same way and executed by that investor’s local agent on the investor’s behalf except that, if the original investment was registered with the Central Bank of Brazil, pursuant to Resolution No. 4,373/2014 of the Central Bank of Brazil, the foreign investor, through its local agent, should also seek amendment, if necessary, of the electronic certificate of registration to reflect the new ownership.
The B3 operates a central clearing system (the Central Depositária of the B3). A holder of common shares of Cosan may choose, at its discretion, to hold our common shares through this system and all shares elected to be put into the system will be deposited in custody with the relevant stock exchange (through a Brazilian institution duly authorized to operate by the Central Bank of Brazil having a clearing account with the relevant stock exchange). The fact that those shares are subject to custody with the relevant stock exchange will be reflected in our register of shareholders. Each participating shareholder will, in turn, be registered in our register of beneficial shareholders maintained by the relevant stock exchange and will be treated in the same way as a registered shareholder.
Shareholders’ Meetings
Pursuant to the Brazilian Corporation Law, our shareholders are generally empowered to take any action relating to our corporate purposes and to pass resolutions that they deem necessary. Shareholders at our annual general shareholders’ meeting, which is required to be held within the first four months of the end of each year, have the exclusive right to approve our audited financial statements and our management accounts, as well as to determine the allocation of our net income and the distribution of dividends with respect to the fiscal year ended immediately prior to the date of the relevant shareholders’ meeting. Generally (1) the installation of the fiscal council and election of its members, (2) the election of the members of our board of directors and (3) the determination of the annual compensation of our executive officers, board of directors and fiscal council are approved in the annual shareholders’ meeting, but such matters may also be approved at extraordinary shareholders’ meetings.
An extraordinary shareholders’ meeting may be held at any time during the year, including concurrently with the annual shareholders’ meeting. The following matters, among others, may be resolved only at a shareholders’ meeting:
Quorum
As a general rule, the Brazilian Corporation Law provides that the quorum for purposes of a shareholders’ meeting consists of the presence of shareholders representing at least 25% of our issued and outstanding shares on first call, and, if that quorum is not reached, any percentage on second call. If our shareholders meet to amend our bylaws, a supermajority quorum of shareholders representing at least two-thirds of our issued and outstanding shares shall be required on first call, and any percentage will be sufficient on second call.
A shareholder may be represented in a shareholders’ meeting by an attorney-in-fact appointed no more than one year prior to the date of the relevant shareholders’ meeting. The attorney-in-fact must be a shareholder, director or executive officer of Cosan, a lawyer or a financial institution registered by their manager.
Generally, the affirmative vote of shareholders representing at least the majority of our issued and outstanding shares present in person, or represented by proxy, at a shareholders’ meeting is required to approve any proposed action, with abstentions not taken into account. Exceptionally, according to the Brazilian Corporation Law, the affirmative vote of shareholders representing not less than one-half of our issued and outstanding shares is required to, among other measures:
Location of a Shareholders’ Meeting
Our shareholders’ meetings take place at our headquarters in the city of São Paulo, State of São Paulo, Brazil. The Brazilian Corporation Law allows our shareholders to hold meetings in another location in the event of a force majeure, provided that the meetings are held in the city of São Paulo and the relevant notice includes a clear indication of the place where the meeting will occur. All information relating to shareholders’ meetings will be available (1) at our headquarters, in the City of São Paulo, State of São Paulo, at Avenida Brigadeiro Faria Lima, 4,100, 16th floor, ZIP Code 04538-132 and (2) on the internet at our website (https://ri.cosan.com.br/en/), the website of the CVM (https://www.cvm.gov.br/cvm/en?set_language=en), and the website of B3 (www.b3.com.br). The information included on these websites does not form part of this annual report and is not incorporated by reference herein.
Who May Call a Shareholders’ Meeting
The shareholders’ meetings may be called by our board of directors and by:
Notice of a Shareholders’ Meeting
All notices of general meetings must be published at least three times in any newspaper widely circulated, which, in our case, is the Estado de São Paulo. The notice must include, in addition to the place, date and time, the agenda of the meeting and, in the case of a proposed amendment to our bylaws, a description of the subject matter of the proposed amendment.
Conditions of Admission to our Shareholders’ Meeting
To attend a shareholders’ meeting and exercise their voting rights shareholders must, within two days prior to the shareholders’ meeting, prove their status as shareholders and their ownership of by presenting his or her identity card/organizational documents and proof of power of attorney, if applicable, and proof of deposit issued by the financial institution responsible for the bookkeeping of the common shares of Cosan.
A shareholder may be represented at a shareholders’ meeting by a proxy, appointed less than one year before the meeting, who must be one of our shareholders, or one of our officers or directors, a lawyer or a financial institution represented by their manager.
Delisting from the Novo Mercado
At any time, Cosan may decide to delist its common shares from the Novo Mercado. To delist its common shares from the Novo Mercado, Cosan (or its controlling shareholders) would be required to first launch a public tender offer through which Cosan or the controlling shareholders would acquire the free float shares, or the “Delisting TO.” The Delisting TO must comply with the applicable rules of the CVM Resolution No. 85, dated March 31, 2022, as amended or “CVM Resolution No. 85,” and (1) have a “fair price,” according to the Brazilian Corporation Law; and (2) be approved by the holders of more than 2/3 of the outstanding free float shares. However, the Delisting TO requirement can be waived so long as holders of 2/3 of the free float shares approve such waiver. Our delisting from the Novo Mercado will not necessarily result in the loss of its registration as a public company on the B3.
If Cosan delists from Novo Mercado due a corporate restructuring transaction, either (1) the surviving company must submit the application for listing on the Novo Mercado within 120 days after the date of the shareholders’ meeting that approved such corporate restructuring transaction or (2) if the resulting companies do not wish to be listed on the Novo Mercado, the majority of the holders of the outstanding free float shares must approve such corporate restructuring transaction.
In certain circumstances, Cosan (or its controlling shareholders) could be required under the Novo Mercado rules to launch a Delisting TO. Novo Mercado regulation stipulates that the compulsory delisting from Novo Mercado will be applied only in the event Cosan has violated Novo Mercado listing rules for a period of more than nine months.
Under CVM rules, if the offeror in a Delisting TO, or the “Delisting TO Offeror,” subsequent transfers shareholding control within the 12-month period following the occurrence of a Delisting TO, the Delisting TO Offeror must pay to the former shareholders that tendered their shares in the Delisting TO, or the “Delisting TO Former Shareholders,” on a pro rata basis, the difference, if any, between the tender offer price paid to the Delisting TO Former Shareholders and the price the Delisting TO Offeror received in such subsequent transfer.
Purchases of Our Common Shares for Treasury
Pursuant to CVM Resolution No. 77, dated March 29, 2022, or “CVM Resolution No. 77,” the purchase or sale by us of our own shares requires shareholders’ approval in the event that the transaction:
Subject to certain conditions described in CVM Resolution No. 77, our shareholders’ approval is not required for the purchase or sale by us of our own shares:
We may acquire our own shares to be held in treasury, sold or canceled, pursuant to a resolution of our board of directors or our shareholders, as applicable. We may not acquire our shares, hold them in treasury or cancel them in the event that such transaction:
To authorize the purchase of our own shares, our board of directors or our shareholders (through a resolution approved at a shareholders meeting) must specify the purpose of the transaction, the maximum number of shares to be acquired, the total number of our outstanding shares and the maximum period of time to effect such purchase (not exceeding 18 months), among other information required by CVM Resolution No. 77.
Policy for the Trading of Our Securities by Us and Its Controlling Shareholder (If Any), Directors and Officers
CVM Resolution No. 44, dated August 23, 2021, or “CVM Resolution No. 44,” establishes that “insiders” must abstain from trading our securities, including derivatives backed by or linked to our securities, prior to our disclosure of material information to the market.
The following persons are considered insiders for purposes of CVM Resolution No. 44: we, any person who negotiated any of our securities and made use of any relevant nondisclosed information acquired, our controlling shareholder (if any), members of our board of directors, executive officers, members of our fiscal council and whoever by virtue of its title, duty or position in our company, our controlling shareholder, controlled companies or affiliates has knowledge of a material fact and is aware that such fact has not been disclosed to the market, including auditors, analysts, underwriters and advisors.
Such restriction on trading also applies:
For information concerning our material contracts, see “Item 4. Information on the Company,” “Item 5. Operating and Financial Review and Prospects,” “Item 7. Major Shareholders and Related Party Transactions—A. Major Shareholders—Shareholders Agreement” and “Item 7. Major Shareholders and Related Party Transactions—B. Related Party Transactions.”
Except as otherwise disclosed in this annual report on Form 20-F (including the Exhibits), we are not currently, and have not been in the last two years, party to any material contract, other than contracts entered into in the ordinary course of business.
Investors who are non-residents in Brazil must register their investment in shares under Law No. 4,131, or CMN Resolution No. 4,373, and CVM Resolution No. 13 of November 18, 2020.
CMN Resolution No. 4,373 affords favorable tax treatment to foreign investors who are not residents in a low or nil tax jurisdiction, as defined by Brazilian tax laws (please refer to the section “Taxation” for further discussion on the concept of a low or nil tax jurisdiction under Brazilian law).
Under CMN Resolution No. 4,373, investors who are non-residents in Brazil may invest in almost all financial assets and engage in almost all transactions available in the Brazilian financial and capital markets, provided that certain requirements are met. CMN Resolution No. 4,373 covers investors who are individuals, companies, mutual funds and other collective investment entities domiciled or headquartered outside of Brazil. Under CMN Resolution No. 4,373, an investor under this category must:
In addition, an investor operating under the provisions of CMN Resolution No. 4,373 must be registered with the Brazilian internal revenue service pursuant to its Normative Ruling No. 2,119/2022. This registration process is undertaken by the investor’s legal representative in Brazil.
Securities and other financial assets held by non-Brazilian investors pursuant to CMN Resolution No. 4,373 must be registered or maintained in deposit accounts or under the custody of an entity duly licensed by the Central Bank of Brazil or the CVM. In addition, securities trading is restricted to transactions carried out in the stock exchanges or through organized over-the-counter markets licensed by the CVM, except for transfers resulting from a corporate reorganization, or occurring upon the death of an investor by operation of law or will.
Non-Brazilian investors may also invest directly under Law No. 4,131 and may sell their shares in both private and open market transactions, but these investors are subject to less favorable tax treatment on gains than Resolution No. 4,373 investors. A non-Brazilian direct investor under Law No. 4,131 must:
If a holder of ADSs decides to exchange ADSs for the underlying common shares, the holder will be entitled to (1) sell the common shares on the B3 and rely on the depositary’s electronic registration for five business days from the date of exchange to obtain and remit U.S. dollars abroad upon the holder’s sale of our common shares, (2) convert its investment into a foreign portfolio investment under of CMN Resolution No. 4,373, or (3) convert its investment into a foreign direct investment under Law No. 4,131.
If a holder of ADSs wishes to convert their investment into either a foreign portfolio investment under CMN Resolution No. 4,373 or a foreign direct investment under Law No. 4,131, they should begin the process of obtaining foreign investor registration with the Central Bank of Brazil or with the CVM as the case may be, in advance of exchanging the ADSs for common shares.
The custodian is authorized to update the depositary’s electronic registration to reflect conversions of ADSs into foreign portfolio investments under CMN Resolution No. 4,373. If a holder of ADSs elects to convert their ADSs into a foreign direct investment under Law No. 4,131, the conversion will be effected by the Central Bank of Brazil after receipt of an electronic request from the custodian with details of the transaction.
If a foreign direct investor under Law No. 4,131 wishes to deposit their shares into the ADR program in exchange for ADSs, such holder will be required to present to the custodian evidence of payment of capital gains taxes. The conversion will be effected by the Central Bank of Brazil after receipt of an electronic request from the custodian with details of the transaction. Please refer to “Taxation” for a description of the tax consequences to an investor residing outside Brazil of investing in our common shares in Brazil.
For additional information on Brazilian tax consequences of investing in our common shares, see “Taxation.”
U.S. Federal Income Tax Considerations
The following is a description of the material U.S. federal income tax consequences of owning and disposing of our common shares or ADSs during the year ended December 31, 2025. It does not purport to be a comprehensive description of all of the tax considerations that may be relevant to a particular person’s decision to hold the securities. This discussion applies to you only if you are a U.S. Holder (as defined below) that holds our common shares or ADSs as capital assets for U.S. federal income tax purposes.
This discussion does not describe all of the tax consequences that may be relevant to you in light of your particular circumstances, including any minimum tax consequences, the potential application of the provisions of the Internal Revenue Code of 1986, as amended, or the “Code,” known as the Medicare contribution tax and differing tax consequences applicable to you if you are, for instance:
If you are a partnership for U.S. federal income tax purposes holding our common shares or ADSs, the U.S. federal income tax treatment of your partners will generally depend on the status of the partners and the activities of your partnership. Partnerships holding our common shares or ADSs and partners in such partnerships should consult their tax advisers as to the particular U.S. federal income tax consequences of holding and disposing of our common shares or ADSs.
This discussion is based on the Code, administrative pronouncements, judicial decisions and final, temporary and proposed Treasury regulations, all as of the date hereof, any of which is subject to change, possibly with retroactive effect. Please consult your tax adviser concerning the U.S. federal, state and local and non-U.S. tax consequences of owning and disposing of our common shares or ADSs in your particular circumstances.
As used herein, the term “U.S. Holder” means a beneficial owner of our common shares or ADSs that is, for U.S. federal income tax purposes:
In general, if you own ADSs, you will be treated as the owner of the underlying shares represented by those ADSs for U.S. federal income tax purposes. Accordingly, no gain or loss will be recognized if you exchange ADSs for the underlying shares represented by those ADSs.
This discussion generally assumes that we are not, and will not become, a passive foreign investment company, as described below.
Taxation of Distributions
The following is subject to the discussion under “—Passive Foreign Investment Company Rules” below.
Distributions paid on our common shares or ADSs (including distributions that are treated as interest on equity for Brazilian tax purposes, as discussed below under “—Brazilian Tax Considerations”), other than certain pro rata distributions of common shares or ADSs, will be treated as dividends to the extent paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). Because we do not expect to determine our earnings and profits in accordance with U.S. federal income tax principles, you should expect that a distribution will generally be reported as a dividend. Dividends paid by qualified foreign corporations to certain non-corporate U.S. Holders are taxable at rates applicable to long-term capital gains. A foreign corporation is treated as a qualified foreign corporation with respect to dividends paid on stock that is readily tradable on a securities market in the United States, such as the NYSE (where our ADSs are traded). If we decide to delist our ADSs from the NYSE and not list them on any established securities market in the United States, they would not be eligible for these preferential rates. It is unclear whether these reduced rates will apply to dividends paid with respect to our common shares that are not represented by ADSs. You should consult your tax adviser to determine whether these preferential rates will apply to dividends you receive and whether you are subject to any special rules that limit your ability to be taxed at these preferential rates.
The amount of a dividend will include any amounts withheld in respect of Brazilian taxes on the distribution. The amount of the dividend will be treated as foreign-source dividend income to you and will not be eligible for the dividends-received deduction generally allowed to U.S. corporations under the Code. Dividends will be included in your income on the date of your or, in the case of ADSs, the depositary’s, receipt of the dividend. The amount of any dividend income paid in reais will be the U.S. dollar amount calculated by reference to the exchange rate in effect on the date of such receipt regardless of whether the payment is in fact converted into U.S. dollars. If the dividend is converted into U.S. dollars on the date of receipt, you generally should not be required to recognize foreign currency gain or loss in respect of the dividend income. You may have foreign currency gain or loss if the dividend is converted into U.S. dollars after the date of its receipt.
Sale or Other Disposition of Common Shares or ADSs
For U.S. federal income tax purposes, gain or loss you realize on the sale or other disposition of our common shares or ADSs will be capital gain or loss, and will be long-term capital gain or loss if you held those shares or ADSs for more than one year at the time of disposition. The amount of gain or loss will be equal to the difference between your tax basis in the common shares or ADSs disposed of and the amount realized on the disposition. The gain or loss will generally be U.S.-source gain or loss for foreign tax credit purposes. If a Brazilian tax is withheld on the sale or other disposition of common shares or ADSs, your amount realized will include the gross amount of the proceeds of such sale or other disposition before deduction of the Brazilian tax.
See “—Brazilian Tax Considerations—Income Tax—Capital Gains” for a description of when a disposition may be subject to taxation by Brazil.
Foreign Tax Credits in Respect of Brazilian Taxes
Subject to applicable limitations that may vary depending upon your circumstances, including limitations described in the following discussion, it is possible that Brazilian income taxes withheld from dividends on our common shares or ADSs might be creditable against your U.S. federal income tax liability. On December 28, 2021, new Treasury Regulations pertaining to foreign tax credits (the “FTC Regulations”) were released that impose significant new limitations on the non-U.S. taxes (including withholding taxes) for which a foreign tax credit can be claimed. Corrections with respect to the FTC Regulations were published on July 27, 2022. We have not determined whether these limitations will prevent you from claiming a foreign tax credit with respect to any withholding tax imposed on dividends on common shares or ADSs. Furthermore, subsequent notices from the IRS indicate that the Treasury and the IRS are considering proposing amendments to such regulations and allow taxpayers, subject to certain conditions, to defer the application of many aspects of such regulations until the date when a notice or other guidance withdrawing or modifying this temporary relief is issued (or any later date specified in such notice or other guidance). If Brazilian withholding taxes on dividends on common shares or ADSs were otherwise creditable, the availability of those credits would be subject to other applicable limitations that may vary depending on your circumstances. You should therefore consult your tax advisers as to the availability of foreign tax credits for any amounts withheld with respect to dividends on common shares or ADSs.
You will be entitled to use foreign tax credits to offset only the portion of your U.S. tax liability that is attributable to foreign-source income. This limitation on foreign taxes eligible for credit is calculated separately with regard to specific classes of income. In addition, you must satisfy minimum holding period requirements to be eligible to claim a foreign tax credit for foreign taxes withheld on dividends.
In addition, the FTC Regulations generally will preclude you from claiming a foreign tax credit with respect to any tax imposed on gains from the disposition of shares by a jurisdiction, such as Brazil, that does not have an applicable income tax treaty with the United States. As discussed above, the IRS has released notices that provide temporary relief from certain of the provisions of the FTC Regulations (including the limitation described in the preceding sentence) for taxable years ending before the date that a notice or other guidance withdrawing or modifying the temporary relief is issued (or any later date specified in such notice or other guidance). However, because any gain from dispositions of the common shares or ADSs generally will be U.S.-source gain for foreign tax credit purposes, even if the FTC Regulations do not prohibit a U.S. Holder from claiming a foreign tax credit with respect to Brazilian income taxes on disposition gains, other limitations under the foreign tax credit rules may preclude a U.S. Holder from claiming a foreign tax credit with respect to such Brazilian income taxes.
If you are precluded from claiming a foreign tax credit, it is possible that any Brazilian taxes on disposition gains may either be deductible or reduce the amount realized on the disposition. An election to deduct foreign taxes instead of claiming foreign tax credits must apply to all taxes paid or accrued in the taxable year to foreign countries and possessions of the United States.
Any Brazilian IOF/Exchange Tax (as discussed below under “—Brazilian Tax Considerations—Tax on Mergers Involving Bonds and Securities”) will not be treated as creditable foreign taxes for U.S. federal income tax purposes. You should consult your tax adviser regarding the tax treatment of these taxes for U.S. federal income tax purposes.
The rules governing foreign tax credits are complex and, therefore, you should consult your tax adviser regarding the creditability or deductibility of any Brazilian tax in your particular circumstances.
Passive Foreign Investment Company Rules
We expect that we were not a PFIC for our taxable year ended December 31, 2025. However, we cannot assure you that we will not be considered a PFIC for the 2025 taxable year or any future taxable year. Our PFIC status for any taxable year is an annual factual determination that can be made only after the end of that year and depends on the composition of our income and assets and the value of our assets from time to time. Moreover, we hold significant minority investments in certain entities (representing less than 25% by value of the relevant entity’s equity). Accordingly, our PFIC status for any taxable year will depend in part on the value of those minority investments relative to the value of our active assets, including goodwill. The value of our goodwill may be determined, in large part, by reference to our market capitalization. If the value of our minority (less-than-25%-owned) equity investments were to increase relative to our active assets (in particular, if our market capitalization were to decline), we could be treated as a PFIC for our taxable year 2026 and/or future taxable years. Thus, we cannot assure you that we will not be considered a PFIC for any taxable year.
If we were a PFIC for any taxable year during which you held our common shares or ADSs, gain recognized by you on a sale or other disposition (including certain pledges) of the common shares or ADSs would be allocated ratably over your holding period for the common shares or ADSs. The amounts allocated to the taxable year of the sale or other disposition and to any year before we became a PFIC would be taxed as ordinary income. The amount allocated to each other taxable year would be subject to tax at the highest rate on ordinary income in effect for individuals or corporations, as appropriate for that taxable year, and an interest charge would be imposed on the resulting tax liability. Further, to the extent any distribution in respect of our common shares or ADSs exceeded 125% of the average of the annual distributions on common shares or ADSs received by you during the preceding three years or your holding period, whichever was shorter, that distribution would be subject to taxation in the same manner as gain, described immediately above. Certain elections might be available that would result in alternative treatments (such as mark-to-market treatment) of our common shares or ADSs. You should consult your tax adviser to determine whether these elections would be available and, if so, what the consequences of the alternative treatments would be in your particular circumstances.
In addition, if we were a PFIC for the taxable year in which we paid a dividend or for the prior taxable year, the favorable tax rates applicable to long-term capital gains discussed above with respect to dividends paid to non-corporate U.S. Holders would not apply.
If a U.S. Holder owns our common shares or ADSs during any year in which we are a PFIC, the U.S. Holder generally must file annual reports containing such information as the U.S. Treasury may require on IRS Form 8621 (or any successor form) with respect to the Company, generally with the U.S. Holder’s federal income tax return for that year.
U.S. Holders should consult their tax advisers regarding the potential application of the PFIC rules.
Information Reporting and Backup Withholding
Payments of dividends and sales proceeds that are made within the United States or through certain U.S.-related financial intermediaries generally are subject to information reporting and backup withholding unless (1) you are a corporation or other exempt recipient or (2) in the case of backup withholding, you provide a correct taxpayer identification number and certify that you are not subject to backup withholding.
The amount of any backup withholding from a payment to you will be allowed as a credit against your U.S. federal income tax liability and may entitle you to a refund, provided that the required information is timely furnished to the Internal Revenue Service.
Brazilian Tax Considerations
Income Tax
On November 26, 2025, Law No. 15,270, or Law No. 15,270/25, was enacted, introducing dividend taxation whenever paid, credited, delivered, employed or remitted to a beneficiary resident or domiciled abroad. According to this law, as from January 1, 2026, dividend payments are subject to 10% withholding income tax. So, dividends paid by a Brazilian corporation, such as Cosan, to a Non-Resident Holder of shares are currently subject to a 10% withholding income tax.
Law No. 15,270/25 provides specific exceptions, which remain not subject to withholding income tax. In particular, dividends from profits derived until 2025 should not be subject to taxation, provided that (i) their distribution is approved by December 31, 2025, and (ii) they are due and payable under applicable civil or corporate law, and are paid, credited or delivered under the terms originally provided in the relevant corporate act. Also, dividends are not subject to taxation whenever paid, credited, delivered, employed or remitted to (i) foreign governments, provided that reciprocal treatment is granted to the income derived in the jurisdiction by the Brazilian government, (ii) sovereign wealth funds (as defined in applicable law), and (iii) certain foreign pension entities (as further defined in future regulation).
Law No. 15,270/25 provided a tax credit mechanism to non-residents whenever the sum of the effective corporate taxation on the distributed profits of the Brazilian company and the 10% withholding income tax on dividends payments exceeds the combined nominal rates of Brazilian corporate income tax and social contribution on net profits (34%, 40% or 45%, as applicable). The procedures for the tax credit are subject to specific and future regulation.
Interest Attributable to Shareholder’s Equity
Law No. 9,249, dated December 26, 1995, as amended, or Law No. 9,249/95, allows a Brazilian corporation, such as Cosan, to make distributions to shareholders of interest on equity and treat those payments as a deductible expense for purposes of calculating Brazilian corporate income tax and social contribution on net profits as long as the limits described below are observed. These distributions may be paid in cash. For tax purposes, this interest is limited to the daily pro rata variation of the TJLP as determined by the Central Bank of Brazil from time to time, and the amount of the deduction may not exceed the greater of:
As from January 1, 2026, payment of interest on equity to a Non-Resident Holder is subject to withholding income tax at the rate of 17.5%, pursuant to Complementary Law No. 224/25, which amended Law No. 9,249/95, or 25% if the Non-Resident Holder is domiciled in a Low or Nil Tax Jurisdiction.
These payments may be included, at their net value, as part of any mandatory dividend. To the extent the payment of interest on equity is so included, the corporation is required to distribute to shareholders an additional amount to ensure that the net amount received by them, after payment of the applicable Brazilian withholding income tax, plus the amount of declared dividends is at least equal to the mandatory dividend.
Distributions of interest on equity to Non-Resident Holders may be converted into U.S. dollars and remitted outside Brazil, subject to applicable exchange controls, to the extent that the investment is registered with the Central Bank of Brazil.
Capital Gains
According to Article 26 of Law No. 10,833, dated December 29, 2003, as amended, gains related to the sale or disposition of assets located in Brazil, such as the shares of Cosan, by a Non-Resident Holder, are subject to withholding income tax in Brazil, regardless of whether the sale or disposition is made by a Non-Resident Holder to another non-resident of Brazil or to a Brazilian resident.
As a general rule, capital gains realized as a result of a sale or disposition of shares are equal to the positive difference between the amount realized on the sale or disposition and the respective acquisition costs of the shares.
According to the legislation currently in force, capital gain realized by a Non-Resident Holder on a sale or disposition of shares in Brazil shall be determined in local currency.
Under Brazilian law, income tax on such gains can vary depending on the domicile of the Non-Resident Holder, the type of registration of the investment by the Non-Resident Holder with the Central Bank of Brazil and how the disposition is carried out, as described below.
Currently, capital gains realized by Non-Resident Holders on a sale or disposition of shares carried out on the B3 (including the organized over-the-counter market) are:
A withholding income tax of 0.005% will apply and can be offset against the eventual income tax due on the capital gain. Such withholding does not apply to a Portfolio Holder that is not resident or domiciled in a Low or Nil Tax Jurisdiction.
Under current law, for transactions taking place outside the B3 or the organized over-the-counter market, capital gains recognized by a Non-Resident Holder would be, in principle, subject to income tax in Brazil at progressive rates from 15% to 22.5% or to a flat rate of 25%, if such Non-Resident Holder is resident or domiciled in a Low or Nil Tax Jurisdiction.
The rates mentioned above would apply unless a lower rate is provided for in an applicable tax treaty between Brazil and the country where the Non-Resident Holder is domiciled.
Law No. 13,259 of March 16, 2016 determined the new progressive taxation method over capital gains mentioned above that has been in force since January 1, 2017. Capital gains are subject to income tax based on the following rates:
(i) 15% on any capital gain not exceeding R$5.0 million;
(ii) 17.5% on the portion of the capital gain between R$5.0 million and R$10.0 million;
(iii) 20% on the portion of the capital gain between R$10.0 million and R$30.0 million; or
(iv) 22.5% on the portion of the capital gain exceeding R$30.0 million.
If the Non-Resident Holder is a Portfolio Holder and is not resident or domiciled in a Low or Nil Tax Jurisdiction, it is arguable that the progressive rates mentioned above should not apply and, in such case, the Portfolio Holder would be subject to income tax at a fixed rate of 15%.
In the cases above, if the capital gains are related to transactions conducted on the Brazilian non-organized over-the-counter market with the intermediation of a financial institution, the withholding income tax of 0.005% will apply and can later be offset against any income tax due on the capital gains.
The exercise of any preemptive rights relating to our shares will not be subject to Brazilian income tax. Gains realized by a Non-Resident Holder on the disposition of preemptive rights in Brazil will be subject to Brazilian income tax according to the same rules applicable to the sale or disposition of shares.
There can be no assurance that the current favorable tax treatment of Portfolio Holders will continue in the future.
Discussion on Low or Nil Tax Jurisdictions
According to Law No. 9,430, dated December 27, 1996, Low or Nil Tax Jurisdiction is a country or location that (1) does not impose taxation on income, (2) imposes the income tax at a rate lower than 17% or (3) imposes restrictions on the disclosure of shareholding composition or the ownership of the investment.
Law No. 11,727/08 created the concept of Privileged Tax Regimes, which encompasses the countries and jurisdictions that: (1) do not tax income or tax it at a maximum rate lower than 20.0%; (2) grant tax advantages to a non-resident entity or individual (a) without the need to carry out a substantial economic activity in the country or jurisdiction, or (b) conditioned to the non-exercise of a substantial economic activity in the country or jurisdiction; (3) do not tax or tax proceeds generated abroad at a maximum rate lower than 20.0%; or (4) restrict the ownership disclosure of assets and ownership right or restrict disclosure about economic transactions carried out. Although we believe that the best interpretation of the current tax legislation is that the above-mentioned “privileged tax regime” concept should apply solely for purposes of Brazilian transfer pricing and thin capitalization rules, among other rules that make express reference to the concepts, we can provide no assurance that the tax authorities will not interpret the rules as also applicable to a Non-Resident Holder on payments of interest on shareholders’ equity.
In addition, Brazilian tax authorities enacted Normative Ruling No. 1,037, of June 4, 2010, or Normative Ruling No. 1,037/10, as amended, listing (1) the countries and jurisdictions considered Low or Nil Tax Jurisdictions, and (2) the Privileged Tax Regimes.
The interpretation of the current Brazilian tax legislation should lead to the conclusion that the concept of Privileged Tax Regimes should only apply for certain Brazilian tax purposes, such as transfer pricing and thin capitalization rules. According to this interpretation, the concept of Privileged Tax Regimes should not be applied in connection with the taxation of dividends, interest on equity and gains related to investments made by Non-Brazilian Holders in Brazilian corporations. Regulations and non-binding tax rulings issued by Brazilian federal tax authorities seem to confirm this interpretation.
Currently, the understanding of the Brazilian tax authorities is that the rate of 15.0% withholding tax applies to payments made to beneficiaries residing in privileged tax regimes (Answer to Advance Tax Ruling Request COSIT No. 575, of December 20, 2017). In any case, if the Brazilian tax authorities determine that payments made to a Non-Resident Holder under a privileged tax regime are subject to the same rules applicable to payments made to Non-Resident Holders located in Low or Nil Tax Jurisdictions, the withholding tax applicable to such payments could be assessed at a rate up to 25.0%.
We recommend that you consult your own tax advisors from time to time to verify any possible tax consequences arising from Normative Ruling No. 1,037/10 and Law No. 11,727.
Tax on Foreign Exchange Transactions
Pursuant to Decree No. 6,306, dated December 14, 2007, as amended, or Decree No. 6,306/07, the conversion of Brazilian currency into foreign currency (e.g., for purposes of paying dividends and interest paid on shareholders’ equity), and the conversion of foreign currency into Brazilian currency, may be subject to Tax on Foreign Exchange Transactions, or IOF/Exchange.
Currently, for most exchange transactions, the rate of IOF/Exchange is 0.38% for the inflow of funds, and 3.5% for the outflow of funds. However, foreign exchange transactions carried out for the inflow of funds into Brazil and the outflow of funds from Brazil in connection with investments in financial and capital markets carried out by an investor that is in accordance with the rules and conditions established by the Brazilian Monetary Council, including payments of dividends and interest on shareholders’ equity and the repatriation of funds invested in the Brazilian market are currently subject to IOF/Exchange at a zero percent rate. The Brazilian government is permitted to increase the rate of IOF/Exchange at any time up to 25% of the amount of the foreign exchange transaction. However, any increase in rates may only apply to transactions carried out after this increase in rate and not retroactively.
Tax on Bonds and Securities Transactions
Pursuant to Decree No. 6,306/07, the Tax on Bonds and Securities Transactions, or IOF/Bonds, may be imposed on transactions involving bonds and securities, including those carried out on a Brazilian stock exchange and future and commodities exchanges.
The IOF/Bonds tax rate applicable to most transactions involving shares is currently zero, including transactions related to the transfer of shares traded in the Brazilian stock exchange with the purpose of issuance of depositary receipts to be traded outside of Brazil. The Brazilian government is permitted to increase such rate at any time to up to 1.5% of the transaction amount per day, but only in respect of future transactions.
Sale of ADSs
We do not expect the gains realized by a Non-Resident Holder on the disposition of ADSs to another non‑Brazilian resident to be subject to Brazilian tax, based on the argument that the ADSs would not constitute assets located in Brazil for purposes of Law No. 10,833/03. However, we cannot assure you how Brazilian courts would interpret the definition of assets located in Brazil in connection with the taxation of gains realized by a Non-Resident Holder on the disposition of ADSs to another non-Brazilian resident. As a result, gains on a disposition of ADSs by a Non-Resident Holder to a Brazilian resident, or even to a Non-Resident Holder in the event that courts determine that the ADSs would constitute assets located in Brazil, may be subject to income tax in Brazil according to the rules described above. If this income tax does apply, it could have an adverse impact on Non-Resident Holders.
Gains on the Exchange of ADSs for Shares
Non-Resident Holders may exchange ADSs for the underlying shares, sell the shares on a Brazilian stock exchange and remit abroad the proceeds of the sale. As a general rule, the exchange of ADSs for shares is not subject to income taxation in Brazil.
Upon receipt of the underlying shares in exchange for ADSs, Non-Resident Holders may also elect to register with the Central Bank of Brazil the U.S. dollar value of such shares as a foreign portfolio investment under CMN Resolution No. 4,373/14, which will entitle them to the tax treatment referred above on the future sale of the shares.
Alternatively, the Non-Resident Holder is also entitled to register with the Central Bank of Brazil the U.S. dollar value of such shares as a foreign direct investment under Law No. 4,131/62, in which case the respective sale would be subject to the tax treatment applicable to transactions carried out of by a Non-Resident Holder that is not a 4,373 Holder.
Gains on the Exchange of Shares for ADSs
The deposit of shares of a Brazilian entity in exchange for the ADSs by a Non-Resident Holder may be subject to Brazilian withholding income tax on capital gains if the acquisition cost is lower than the share price verified on the exchange date. The capital gains ascertained by the Non-Resident Holder, in this case, should be subject to taxation at rates that vary from 15% to 22.5%, depending on the amount of the gain, as referred to above; or at 25% if realized by a Non-Resident Holder that is resident or domiciled in a Low or Nil Tax Jurisdiction. In certain circumstances, there may be arguments to sustain the position that such taxation is not applicable to 4,373 Holders that are not resident or domiciled in a Low or Nil Tax Jurisdiction, which would be subject to taxation at a fixed 15% rate. There is proposed legislation seeking to increase the 15% to 22.5% rate to 17.5% effectively from January 2026 on. It is not possible to predict if this pending legislation will be approved by the Brazilian Congress.
Brazilian law imposes a tax on foreign exchange transactions, or “IOF/Exchange,” due on the conversion of Brazilian currency into foreign currency (e.g., for purposes of paying dividends and interest) and the conversion of foreign currency into Brazilian currency. Currently, for most exchange transactions, the rate of IOF/Exchange is 0.38%.
Effective as of December 1, 2011, however, the IOF/Exchange is levied at a rate of 0% over foreign exchange transactions entered into in connection with the inflow of proceeds to Brazil for investments made by a foreign investor (including a Non-Resident Holder) in (1) variable income transactions carried out on the Brazilian stock, futures and commodities exchanges, and (2) the acquisitions of shares of Brazilian publicly held companies in public offerings or subscription of shares related to capital contributions, provided that the company has registered its shares for trading with the stock exchange. As of June 5, 2013, this beneficial tax treatment was extended to all investments made under the rules of CMN Resolution 4,373/14 in the Brazilian financial and capital markets, including the investment in common shares. The IOF/Exchange at a rate of 0% also applies for the outflow of funds from Brazil related to these types of investments, including payments of dividends and interest on equity and the repatriation of funds invested in the Brazilian market.
Furthermore, the IOF/Exchange is currently levied at a 0% rate on the withdrawal of ADSs into shares of a Brazilian entity. Nonetheless, the Brazilian government may increase the rate at any time up to 25%. However, any increase in rates may only apply to future foreign exchange transactions.
Tax on Mergers Involving Bonds and Securities
Brazilian law imposes a tax on transactions involving bonds and securities, or “IOF/Bonds,” including those carried out on a Brazilian stock exchange. The rate of IOF/Bonds applicable to transactions involving common shares is currently 0%, although the Brazilian government may increase such rate at any time up to 1.5% of the transaction amount per day, but only in respect of future transactions.
On December 24, 2013, the Brazilian government reduced the IOF/Bonds to zero for transactions involving the deposit of shares which are issued by a Brazilian company admitted to trade on the B3 with the specific purpose of enabling the issuance of depositary receipts traded outside Brazil.
Other Brazilian Taxes
There are no Brazilian inheritance, gift or succession taxes applicable to the ownership, transfer or disposition of common shares by a Non-Resident Holder, except for gift and inheritance taxes imposed by some Brazilian states on gifts or bequests by individuals or entities not domiciled or residing in Brazil to individuals or entities domiciled or residing within such states. There are no Brazilian stamp, issue, registration, or similar taxes or duties payable by holders of common shares.
Statements contained in this annual report as to the contents of any contract or other document referred to are not necessarily complete, and each of these statements is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit hereto. A copy of the complete annual report, including the exhibits and schedules filed herewith, may be inspected without charge at the public reference facilities maintained by the SEC at 100 F Street NE., Washington, D.C., and at the SEC’s regional offices located at 233 Broadway, New York, N.Y., 10279 and North Western Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of such materials may be obtained by mail from the Public Reference Section of the SEC, 100 F Street NE., Washington, D.C., at prescribed rates. Such reports and other information may also be inspected at the offices of the New York Stock Exchange, 11 Wall Street, New York, N.Y. 10005, on which our ADSs are listed. In addition, the SEC maintains a website that contains information which we have filed electronically with the SEC, including our annual reports, periodic reports and other filings, which can be accessed over the internet at https://www.sec.gov.
We are subject to the information and periodic reporting requirements of the Exchange Act and, in accordance therewith, file periodic reports and other information with the SEC. However, as a foreign private issuer, we are exempt from the rules under the Exchange Act relating to the furnishing and content of proxy statements and relating to short-swing profits reporting and liability.
Risk Management
We consider market risk to be the potential loss arising from adverse changes in market rates and prices. The Company, its subsidiaries and jointly controlled entities are exposed to market risks, chief of which are: (1) credit risk; (2) liquidity risk; (3) commodities risk; (4) interest rate risk; (5) foreign currency exchange rate risk; and (6) price risk. To manage its market risks, we have adopted policies and procedures which establish limits and monitor risk exposure and counterparties and approve financial instruments. Risk and financial instrument management activities are carried out through the definition of strategies, establishment of control systems and determination of limits to exposure to market risks. We periodically review our exposure to market risks and determine at the senior management level how to manage and reduce the impact of these risks.
The Company uses derivatives solely to manage market risk, especially commodity price and foreign exchange rate fluctuations. Although the value of these hedge instruments varies, these variations are usually offset by the value of the related hedged item. The parties to these agreements are mainly trade boards and trading companies in the case of futures, options and price setting, and major financial institutions in the case of foreign exchange derivatives and interest rate swaps. The Company does not use derivatives or other hedge instruments for speculative purposes.
As a result, we do not believe that we are subject to any material credit risk arising from these contracts, and accordingly, we do not anticipate any material credit-related losses.
Credit Risk
Credit risk is managed through specific rules concerning client acceptance which require credit rating checks and limits for customer exposure, applicable to all subsidiaries and jointly controlled entities. Raízen generally requires a letter of credit from a reputable bank for most of our sugar export sales. We do not believe that we are subject to any material credit risk and we do not anticipate any material credit-related losses. Management believes that any credit risk is covered by the allowance for doubtful accounts recorded in our statement of financial position.
Liquidity Risk
Liquidity risk arises where we may encounter difficulties in meeting the obligations associated with our financial liabilities that are settled by delivering cash or another financial asset. Our approach to managing liquidity is to ensure, as far as possible, that we will have sufficient liquidity to meet our liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to our reputation. Please see note 5.12 to our audited consolidated financial statements attached hereto for measures on which our management has been working to enable us to honor our commitments.
Commodities Risk
Mainly applicable to the energy-generating business of Raízen, agricultural commodity prices and supply levels change according to unpredictable factors such as the weather, investments, government programs and policies, and changes in world demand, among others.
Raízen conducts sensitivity tests to estimate its exposure to these risks and uses derivatives to mitigate its exposure to sugar price oscillation on the international market. Derivative operations allow us to ensure an average margin for future sales. Raízen actively manages its open positions and monitors the result of these activities on a daily basis through effective mark-to-market controls and price impact simulations so that it may adjust targets and strategies due to changes in market conditions.
For risk management purposes and to evaluate the overall level of commodity price exposure, Raízen further reduces its exposure to commodity market risk related to the sugar and ethanol produced from sugarcane that is purchased from growers and sugarcane harvested from leased land, as both costs are linked to TSR. The price of sugarcane supplied by growers or the lease payments incurred to produce sugarcane harvested by Raízen from leased land are indexed to the market price of sugar and ethanol, which provides a partial natural hedge to domestic sugar and ethanol sales price exposure.
The table below provides information about our (through Raízen) sugar, diesel, gasoline, ethanol and electric power derivative contracts that are sensitive to changes in commodity prices, specifically sugar prices as of December 31, 2025. For the derivative contracts, the table presents the notional amounts in tons, the weighted average contract prices, and the total U.S. dollar contract amount by expected maturity dates.
Commodities Price Risk – Commodities Derivatives Opened as of December 31, 2025
Notional (R$ thousand)
Fair value (R$ thousand)
Futures
Short
ICE
Sugar#11
Feb/26 to Feb/28
7,175,636
t
14,898,199
1,895,944
OTC
717,736
1,576,924
274,731
Options
Feb/26 to Sep/27
644,378
1,289,987
(34,622
Long
(7,772,818
(14,579,619
(1,537,660
NYSE LIFFE
Sugar#5
Feb/26
(5,450
(12,680
140
Apr/26
(36,200
(43,801
(4,218
Feb/26 to Feb/27
(555,778
(1,069,856
106,983
Physical fixed
Jan/26 to Jan/31
12,590,102
24,274,297
37,025
Subtotal – physical fixed sugar short position
12,872,230
24,375,509
41,922
Jan/29 to Nov/26
(6,074,603
(11,545,796
(873
Subtotal – physical fixed sugar long position
(6,421,451
(11,719,099
(2,929
Subtotal – sugar futures short position, net
6,618,283
14,715,564
740,291
B3
Jan/26 to Mar/27
50,850
m³
133,810
(477
NYMEX
Jan/26 to Dec/26
358,554
983,030
9,402
230,000
926,478
7,125
33,658
112,508
4,185
Subtotal – ethanol futures short position
673,062
2,155,826
20,235
(170,880
(485,089
826
Jan/26 to Jun/26
(594,349
(1,482,242
(1,342
(127,400
(507,493
(4,427
Jan/26
(24
(9,151
328
Subtotal – ethanol futures long position
(892,653
(2,483,975
(4,615
CHGOETHNL
610,912
1,863,341
55,495
Subtotal – physical fixed ethanol short position, net
43,052
205,714
5,459
Subtotal – ethanol futures long position, net
(176,539
(122,435
21,079
422,940
1,088,145
38,166
(386,370
(987,692
(28,870
Subtotal – gasoline futures short position, net
36,570
100,453
9,296
Heating Oil
Jan/26 to May/26
952,787
1,701,500
222,507
108,058
193,502
9,601
21,203
13,148
(7,847
Subtotal – heating oil futures short position
1,082,048
1,908,150
224,261
Jan/27 to Apr/26
(1,008,476
(1,525,891
(118,068
Jan/26 to Apr/26
(124,594
(496,782
(13,605
(13,828
(6,647
3,821
60,100
232,464
25,867
Subtotal – heating oil futures short position, net
15,000
74,379
15,525
11,983,216
7,089,727
34,402
Subtotal – physical fixed heating oil long position, net
(6,888,418
2,535,414
5,568
Subtotal – heating oil futures long position, net
(6,938,268
2,488,623
117,502
CCEE/OTC
Energy
Jan/26 to Dec/49
13,524,182
mwh
5,750,398
10,391
Subtotal – energy physical fixed short position, net
8,928,768
5,095,653
552,453
Net exposure of commodity derivatives as of December 31, 2025
22,277,858
1,440,621
Interest Rate Risk
We have fixed and floating rate indebtedness and, therefore, we are exposed to market risk as a result of changes in interest rates. See “—B. Liquidity and Capital Resources—Indebtedness” for further information.
Our interest rate risk refers to the impact of an increase in the TJLP (Long-Term Interest Rate), TR (Reference Interest Rate), IGP-M (General Market Price Index), IPCA (Consumer Price Index) and CDI (Interbank Deposit Certificate) indexed debt on our finance results.
As of December 31, 2025, 22.3%, or R$14,347.0 million (8.8%, or R$5,846.5 million as of December 31, 2024), of our consolidated total debt outstanding was fixed rate debt.
The majority of our debt, except the jointly controlled subsidiary Raízen, is dollar-denominated with fixed interest rates or real-denominated debts indexed to the CDI or TJLP. Most of our outstanding debt is linked to the CDI note. We have a substantial amount of cash and cash equivalents and marketable securities indexed to the CDI, which provides a partial natural hedge to our interest rate exposure of our real-denominated debts.
Based on the foregoing, we believe that as of December 31, 2025, a hypothetical 10% increase in all interest rates would increase our financial expenses by R$1,434.7 million per year based on the net financial expenses we recorded in our consolidated statement of profit or loss for the fiscal year ended December 31, 2025.
Foreign Currency Exchange Rate Risk
The foreign exchange variations to which we are exposed are mainly related to our outstanding perpetual notes in an aggregate amount of U.S.$500 million. We use derivatives to hedge the cash flows for payment of part of the interest on this debt against a possible appreciation of the U.S. dollar against the real. In addition, basic oil imports for the lubricants business are also exposed to foreign exchange variations, hedged by derivatives on a case-by-case basis.
A significant portion of the revenue of the jointly controlled subsidiary Raízen is U.S. dollar denominated. Most of Raízen Energia S.A.’s costs are denominated in reais and, therefore, when the real appreciates against the U.S. dollar, its operating margins are adversely affected. A considerable part of Raízen’s debt is also denominated in dollars, exposing it to the risk of variations in the real to U.S. dollar exchange rate (derivative financial instruments are used to hedge the cash flows for payment of interest of these debts).
Raízen has foreign exchange derivatives to mitigate its exposure to the effect of foreign exchange variations on its sugar and ethanol export revenues, combined with cash outlays to cover its debt commitments in foreign currency, mainly the U.S. dollar. The exchange rate derivatives together with the sugar price derivatives allow Raízen to ensure an average margin from future sales. Raízen actively manages open positions, and the results of these activities are monitored on a daily basis through effective mark-to-market controls and price impact simulations that allow Raízen to adjust targets and strategies as a result of changes in market conditions. Raízen uses financial derivative instruments to hedge foreign exchange risk.
As of December 31, 2025, our foreign exchange exposure, net was R$2,935.6 million (R$2,848.7 million in the fiscal year ended December 31, 2024), which were represented by cash and cash equivalents, loans and derivatives contracts as disclosed in note 5.12 to our audited consolidated financial statements attached hereto.
As a measure of our market risk with respect to our foreign currency exposure, a hypothetical 10% appreciation of the real against the foreign currency would increase in profit by R$2,848.7 million per year, based on the foreign exchange exposure for the fiscal year ended December 31, 2025, before considering the effects on U.S. dollar derivative contracts and other foreign currency denominated assets and liabilities, as set forth below:
(in millions of reais)
Foreign Currency Financial Instruments Outstanding as of December 31, 2025:
Denominated debt(1)
(18,605.1
(1,860.5
Denominated cash and cash equivalents
649.1
64.9
Denominated derivative financial instruments (notional)
14,851.9
1,485.2
Denominated receivables (2)
168.6
16.8
Foreign exchange exposure, net
(2,935.6
293,6
Price Risk
We have natural gas derivative transactions conducted with bank counterparties. The transactions are recognized at fair value through profit or loss, based on the difference between the contracted price and the market price of outstanding contracts as of the date of the balance sheet.
In addition, we are exposed to market risks as a result of the fluctuating prices of certain equity securities and option instruments.
Additionally, we enter into equity derivative contracts that consist of a combination of call and put positions (collar) that limit the risk of devaluation of the value of the shares while allowing us to participate in the appreciation of the shares—equal to 1.34% as of December 31, 2025. These contracts are expected to offset declines in the fair value of these securities below the per-share hedge price on maturity, allowing us to retain a portion of the positive valuation of the per-share hedge price to the relevant price cap. Actual per-share contract hedge prices will vary based on average share prices in effect when the contracts were entered into. Actual maximum contract prices vary based on each contract’s maturity and terms, among other factors. If any of these contracts are terminated before their scheduled maturity date due to a contract-specified event, we will be required to repay the fair value of the guaranteed debt offset by the sum of the fair values of the underlying shares and equity collar, calculated on the date of termination In this structure, we do not own the shares, but we do possess an instrument that enables us to acquire the additional shares through a derivative structure. The calculated values in the aforementioned structure’s sensitivity analysis reflect the impacts of the intrinsic values of the options on the valuation or devaluation of the shares.
In our consolidated balance sheets, the underlying shares and equity collars are recorded at fair value, while secured debt is recorded at principal amount, net of funding costs. These funding expenses are amortized over the respective debt’s term.
In addition, we face risks associated with the share prices of Cosan (CSAN3). We have entered into a total return swap with respect to 80,085,312 shares of Cosan (CSAN3).
JPMorgan Chase Bank, N.A., or the “Depositary,” has acted as depositary in relation to the ADSs program since March 5, 2021. The Depositary’s office is located at 383 Madison Avenue, Floor 11, New York, NY 10179.
Fees and Expenses
The Depositary may charge each person to whom ADSs are issued, including, without limitation, issuances against deposits of common shares of Cosan, issuances in respect of share distributions, rights and other distributions, issuances pursuant to a stock dividend or stock split declared by us or issuances pursuant to a merger, exchange of securities or any other transaction or event affecting the ADSs or deposited securities, and each person surrendering ADSs for withdrawal of deposited securities or whose ADSs are canceled or reduced for any other reason, U.S.$5.00 for each 100 ADSs (or any portion thereof) issued, delivered, reduced, canceled or surrendered, as the case may be. The Depositary may sell (by public or private sale) sufficient securities and property received in respect of a share distribution, rights and/or other distribution prior to such deposit to pay such charge.
The following additional charges shall also be incurred by the holders of American Depositary Receipts evidencing ADSs of Cosan, or “ADRs,” and beneficial owners of ADSs, by any party depositing or withdrawing common shares of Cosan or by any party surrendering ADSs and/or to whom ADSs are issued (including, without limitation, issuance pursuant to a stock dividend or stock split declared by us or an exchange of stock regarding the ADSs or the deposited securities or a distribution of ADSs), whichever is applicable:
To facilitate the administration of various Depositary receipt transactions, including disbursement of dividends or other cash distributions and other corporate actions, the Depositary may engage the foreign exchange desk within the Depositary and/or its affiliates to enter into spot foreign exchange transactions to convert foreign currency into U.S. dollars.
The fees and charges you may be required to pay may vary over time and may be changed by us and by the Depositary. ADR holders will receive prior notice of the increase in any such fees and charges. The right of the Depositary to charge and receive payment of fees, charges and expenses as provided above shall survive the termination of the deposit agreement.
The Depositary may make available to us a set amount or a portion of the Depositary fees charged in respect of the ADR program or otherwise upon such terms and conditions as we and the Depositary may agree from time to time. The Depositary collects its fees for issuance and cancellation of ADSs directly from investors depositing common shares of Cosan or surrendering ADSs for the purpose of withdrawal or from intermediaries acting for them. The Depositary collects fees for making distributions to investors by deducting those fees from the amounts distributed or by selling a portion of distributable property to pay the fees. The Depositary may collect its annual fee for Depositary services by deduction from cash distributions, or by directly billing investors, or by charging the book-entry system accounts of participants acting for them. The Depositary will generally set off the amounts owing from distributions made to ADR holders. If, however, no distribution exists and payment owing is not timely received by the Depositary, the Depositary may refuse to provide any further services to ADR holders that have not paid those fees and expenses owing until such fees and expenses have been paid. At the discretion of the ADS Depositary, all fees and charges owing under the deposit agreement are due in advance and/or when declared owing by the ADS Depositary.
Direct and Indirect Payments
The Depositary has agreed to reimburse us for certain expenses related to the establishment and maintenance of the ADR program upon such terms and conditions as we and the Depositary may agree from time to time. Under certain circumstances, including the removal of JPMorgan Chase Bank, N.A. as depositary, we are required to repay to JPMorgan Chase Bank, N.A. amounts reimbursed in prior periods. For the year ended December 31, 2025, there were no such reimbursements paid to us by the Depositary. For the year ended December 31, 2025, there were no such reimbursements paid to us by the Depositary.
Other Information
See Exhibits Nos. 2.9 and 2.10 to this annual report for the form of deposit agreement, as amended, between us and the Depositary and Exhibit No. 2.8 to this annual report for a description of the rights of holders of the ADSs.
(a) Disclosure Controls and Procedures
We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in reports filed under the Exchange Act is recorded, processed, summarized, and reported within the specified time periods. Our chief executive officer and chief financial officer evaluated the effectiveness, as of December 31, 2025, of our “disclosure controls and procedures,” as defined in Rules 13a‑15(e) and 15d‑15(e) under the Exchange Act.
Based upon this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective as of December 31, 2025, to ensure that information required to be disclosed under the Exchange Act is recorded, authorized, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that the information required to be disclosed is accumulated and communicated in a manner sufficient to allow timely decisions regarding required disclosure.
(b) Management’s Annual Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a‑15(f) and 15d‑15(f). A company’s internal control over financial reporting is a process designed by, or under the supervision of, its chief executive officer and chief financial officer, and effected by the company’s board of directors, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of the effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management assessed the effectiveness of our internal control over financial reporting based on the framework set forth in the Internal Control – Integrated Framework, issued by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission (2013). Based on this assessment, management concluded that our internal control over financial reporting was effective as of December 31, 2025.
(c) Attestation Report of the Registered Public Accounting Firm
The effectiveness of our internal control over financial reporting as of December 31, 2025, has been audited by PricewaterhouseCoopers Auditores Independentes Ltda., or “PwC,” an independent registered public accounting firm, as stated in its report, which appears herein.
(d) Changes in Internal Control over Financial Reporting
In connection with the preparation of the audited consolidated financial statements as of and for the year ended December 31, 2024, we had previously identified a material weakness, namely that we failed to perform a robust risk assessment in connection with an ERP system migration performed at the Company’s subsidiaries Moove Lubricants Limited (“MLL”) and Techniques ET Technologies Appliquees (“TTA”) that resulted in lack of controls to prevent and detect potential inadequate system changes and data manipulation. Therefore, other controls dependent on the system were also deemed ineffective. A material misstatement was prevented through the execution of extensive substantive procedures.
In 2025, we adopted and implemented a remediation plan to address the material weakness described above, which included the following action steps: (i) we began to implement a restructuring of our internal controls department as part of which we engaged external consultants to assist us in improving our internal processes and controls, and (ii) we invested in training, including on-the-job coaching to control owners and performers to assist them in gaining a better understanding of their daily duties and how to address risks. As a result, the material weakness identified in the year ended December 31, 2024 was remediated as of December 31, 2025.
Other than the remediation of the material weaknesses identified in 2024 and remediated in 2025, as discussed above, there were no changes in our internal controls over financial reporting that occurred during the period covered by this annual report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
We have an audit committee responsible for advising the board about the selection of independent auditors, reviewing the scope of the audit, validating other permitted services provided by our independent auditors, and evaluating our internal controls on a steady basis. The members of our audit committee are Ms. Carla Alessandra Trematore, Mr. Luis Claudio Rapparini Soares, and Mr. Paulo Clovis Ayres Filho.
These members are independent, and our board of directors has determined that Carla Alessandra Trematore qualifies as an “audit committee financial expert” in accordance with SEC rules and regulations.
NYSE Rule 303A.10 provides that each U.S. listed company must adopt and disclose a code of business conduct and ethics for directors, officers and employees and promptly disclose any waivers of the code for directors or executive officers. The Company has adopted a code of business conduct and ethics for directors, officers and employees as provided for in NYSE Rule 303A.10, which has been filed with the SEC. See Exhibit 11.1 to our annual report.
The following table describes the total amount billed to Cosan S.A. by Pricewaterhousecoopers Auditores Independentes Ltda., or “PwC,” and BDO RCS Auditores Independentes SS Ltda., or “BDO Brazil,” for services performed during the fiscal years ended December 31, 2025 and 2024, respectively:
(in thousands of reais)
Audit fees
41,796.9
31,486.4
Audit-related fees
9,689.9
Other services
1,417.0
Total consolidated audit fees
Audit Fees
Audit fees in 2025 and 2024 are fees billed for the audit of our annual consolidated financial statements, the reviews of our quarterly consolidated financial statements, and the audit of the statutory financial statements of our subsidiaries. Audit fees also include fees for services that can only be reasonably provided by our independent auditors, such as the issuance of comfort letters and the review of documents furnished or filed with the SEC.
Audit-Related Fees
Audit‑related fees correspond to services provided in connection with assistance related to the review of documents to be filed with local and foreign regulatory bodies, including documents regarding compliance with legislation and regulations, the audit of specific financial statements, prospectus review, due diligence activities, assurance of special‑purpose reports, and other previously agreed‑upon procedures.
Other services relate to services provided in connection with the issuance of the Sustainability Limited Assurance Report and the licensing of the Viewpoint software.
Pre-Approval Policies and Procedures
Our audit committee approves all audit and audit‑related services, tax services, and other services provided by our principal accountants. Any services provided by our principal accountants that are not specifically included within the scope of the audit must be pre‑approved by our board of directors in advance of any engagement. The board of directors is permitted to approve certain fees for audit‑related services, tax services, and other services pursuant to a de minimis exception prior to the completion of the audit engagement.
Our statutory audit committee meets the requirements for the exemption available to foreign private issuers under paragraph (c)(3) of Rule 10A-3 under the Exchange Act. The statutory audit committee is not the equivalent of, or wholly comparable to, a U.S. audit committee. Among other differences, it is not required to meet the standards of “independence” established in Rule 10A-3 and is not fully empowered to act on all the matters that are required by Rule 10A-3 to be within the scope of an audit committee’s authority. See “Item 6. Directors, Senior Management and Employees—A. Directors and Senior Management—Committees of the Board of Directors—Audit Committee” and “Item 6. Directors, Senior Management and Employees—C. Board Practices—Summary of Significant Differences of Corporate Governance Practices—Audit Committee and Audit Committee Additional Requirements.”
The following table reflects purchases of our equity securities by us or our affiliates in 2025 and in 2026 through to the date of this annual report.
January 2025
4,200,000
1.31
February 2025
March 2025
April 2025
May 2025
June 2025
July 2025
August 2025
September 2025
October 2025
November 2025
December 2025
January 2026
52,611,312
0.93
February 2026
March 2026
April 2026
Total(2)
For a comparison of the significant differences between our corporate governance practices and the NYSE Corporate Governance Standards, please see “Item 6. Directors, Senior Management and Employees—C. Board Practices—Summary of Significant Differences of Corporate Governance Practices.”
We have adopted insider trading policies and procedures governing the purchase, sale and other dispositions of our securities by directors, senior management and employees, which policies and procedures are reasonably designed to promote compliance with applicable insider trading laws, rules and regulations, and any listing standards applicable to us. A copy of our insider trading policy is filed as an exhibit to this annual report on Form 20-F.
Information security is an integral component of our enterprise risk management framework and strategic oversight, given its relevance to business continuity, operational resilience, data protection, and stakeholder trust.
Since 2025, we have been operating through cybersecurity governance model designed to foster accountability across business units while maintaining centralized coordination and risk visibility at the group level. Under this model, cybersecurity risk management is embedded within our broader risk management, internal controls, and corporate governance framework.
As a business group, we maintain a centralized cybersecurity operations and intelligence structure that supports the protection of our digital environment through coordinated monitoring, threat analysis, and response capabilities. This structure also provides risk-based insights into business leadership into support informed decision-making and the prioritization of cybersecurity initiatives.
Security risks are mapped and communicated to relevant stakeholders for treatment and mitigation. Independent security assessments are conducted frequently. In addition, our security maturity program evaluates cybersecurity performance across certain companies of the Cosan Group, and the maturity rating has been incorporated as a variable in calculating the variable compensation of certain executives.
The Cyber Defense Center (CDC) at Raízen, a joint venture of Cosan, continues to execute cybersecurity operations for the entire Cosan Group while aligned with Cosan’s information security team to provide oversight and consistency with the Cosan Group’s corporate security standards. The CDC is responsible for incident detection and response, threat intelligence, security testing, and operational technology (OT) security monitoring. In 2025, its scope was expanded to include Data Protection (Database Security), Security Awareness and Culture Initiatives (Guardian Program), Vendor Risk Management, Proof‑of‑Concept Security Evaluations (PoCs and Innovation), and Cloud Security Operations.
Each business unit within the Cosan Group retains direct responsibility for implementing its respective cybersecurity strategy, parameters and controls, including risk management and mitigation actions, internal security leadership structure and compliance with group-wide security standards.
Cybersecurity governance is reinforced through recurring executive forums, including meetings on information security with the participation of business information security officers, or “BISOs,” technology managers, chief information officers, or “CIOs,” and Cosan’s executive leadership, during which key risk indicators, relevant developments, and mitigation priorities are reviewed. Cybersecurity matters are also reported to the Company's Audit Committee and Board of Directors.
Cybersecurity Risk Management and Controls
We maintain a structured cybersecurity risk management process designed to identify, assess, and mitigate cyber risks in a timely manner. Our approach is consistent with international security frameworks, including the NIST Cybersecurity Framework (NIST-CSF), ISO/IEC 27001 and 27002, and the CIS Controls.
Our approach integrates continuous monitoring, threat intelligence, vulnerability management, and proactive security testing, including a next‑generation Security Information and Event Management (SIEM) solution, with the objective of improving real‑time security monitoring and advanced threat detection capabilities. Additionally, we are onboarding a new external Security Operations Center (SOC) partner. We also intend to deploy our Data Loss Prevention (DLP) system with the aim of enhancing sensitive data protection, alongside new cloud security solutions.
In 2024, we launched our Cybersecurity Effectiveness Program, an initiative aimed at continuously measuring and optimizing the effectiveness of our security defenses. This program, currently in its final implementation phase, incorporates breach and attack simulations (BAS), real-world security control validations, and targeted cybersecurity risk assessments. The objective of this program is to enhance our ability to proactively detect, respond to, and mitigate cyber threats before they materialize. During 2025, we have conducted several cybersecurity simulations and control validation exercises designed to improve detection and response capabilities and assess the effectiveness of implemented controls.
Our security program includes ongoing vulnerability management processes, prioritizing remediation efforts based on risk exposure and asset criticality, including industrial and operational technology environments.
We continue to evaluate and enhance our cybersecurity controls and capabilities through investments in technology, processes and personnel, with the objective of strengthening our ability to prevent, detect and respond to cybersecurity incidents and to support operational continuity.
Security Awareness Training Program
Recognizing the importance of human factors in cybersecurity risk management, we maintain a structured security awareness and culture program (the “Guardian Program”) across the Cosan Group. In 2025, the program reached more than 29,000 employees through recurring awareness campaigns, targeted communications and phishing simulations. The program is designed to promote secure behaviors and reduce exposure to social engineering risks.
Incident History and Risk Disclosure
In March 2020, certain subsidiaries and jointly controlled companies experienced a ransomware attack that resulted in a temporary and partial interruption of operations. Following that incident, we strengthened our cybersecurity controls, governance processes and response capabilities.
For the fiscal years ended December 31, 2023, 2024 and 2025, we did not identify any cybersecurity incidents that have materially affected or are reasonably likely to materially affect our business strategy, results of operations or financial condition. However, despite our efforts to strengthen our cybersecurity posture, we cannot eliminate all risks associated with cybersecurity threats, nor can we provide assurance that we have not experienced an undetected cybersecurity incident.
See also “Item 3. Key Information—D. Risk Factors—Risks Related to Our Businesses and the Industries in Which We Operate Generally—We could be the target of attempted cyber threats in the future, which could adversely affect our business.”
We have responded to Item 18 in lieu of responding to this Item.
See our audited consolidated financial statements beginning on page F-1.
We are filing the following documents as part of this annual report on Form 20-F:
1.1
Bylaws of Cosan S.A.
2.1
Indenture dated November 5, 2010 among Cosan Overseas Limited, Cosan S.A. Indústria e Comércio, The Bank of New York Mellon, as Trustee, New York Paying Agent, Transfer Agent and Registrar, The Bank of New York Mellon (London Branch), as London Paying Agent and The Bank of New York Mellon (Luxembourg) S.A., as Paying Agent and Transfer Agent (incorporated by reference to Exhibit 2.5 of Cosan Limited’s annual report on Form 20‑F for the year ended March 31, 2011).
Description of Securities.
2.3
Form of Deposit Agreement among Cosan S.A., J.P. Morgan Chase Bank N.A., as depositary, and the holders from time to time of American depositary shares issued thereunder, including the form of American depositary receipts (incorporated by reference to Exhibit 99(a) to the Registration Statement on Form F‑6 (file no. 333-253471) filed with the SEC on February 24, 2021).
2.4
Amendment No. 1 to the Deposit Agreement among Cosan S.A., J.P. Morgan Chase Bank N.A., as depositary, and the holders from time to time of American depositary shares issued thereunder, including the form of American depositary receipts (incorporated by reference to Exhibit 99(a)(2) to the Registration Statement on Form F-6 POS (file no. 333-253471) filed with the SEC on May 7, 2021).
4.1
Framework Agreement dated August 25, 2010 among Cosan S.A. Indústria e Comércio, Cosan Distribuidora de Combustíveis S.A., Cosan Limited, Houches Holdings S.A., Shell Brasil Limitada, Shell Brazil Holding B.V., Shell Overseas Holdings Limited and Milimétrica Participações S.A., or Framework Agreement (incorporated by reference to Exhibit 4.3 of Cosan Limited’s annual report on Form 20‑F for the year ended March 31, 2010).
4.2
First Amendment to the Framework Agreement dated as of April 7, 2011 (incorporated by reference to Exhibit 4.4 of Cosan Limited’s annual report on Form 20‑F for the year ended March 31, 2011).
4.3
Second Amendment to the Framework Agreement dated as of June 1, 2011 (incorporated by reference to Exhibit 4.5 of Cosan Limited’s annual report on Form 20‑F for the year ended March 31, 2011).
4.4
Third Amendment to the Framework Agreement dated as of March 21, 2012 (incorporated by reference to Exhibit 4.5 of Cosan Limited’s annual report on Form 20‑F for the year ended December 31, 2017).
4.5
Amendment and Restatement Deed to the Joint Venture Agreement among Cosan S.A., Cosan Investimentos e Participações S.A., Raízen S.A., Shell Brazil Holding B.V. and Shell Overseas Holdings Limited dated as of July 11, 2021 (incorporated by reference to Exhibit 4.6 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2021).
4.6
Operating and Coordination Agreement dated June 1, 2011 relating to Raízen Energia Participações S.A., Raízen Combustíveis S.A. and Raízen S.A. (incorporated by reference to Exhibit 4.7 of Cosan Limited’s annual report on Form 20‑F for the year ended March 31, 2011).
4.7
Eight Amendment to the Shareholders’ Agreement of Raízen S.A. dated as of July 27, 2023 (incorporated by reference to Exhibit 4.7 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2023).
Share Purchase Agreement for the acquisition of Comma Oil & Chemicals Limited dated February 29, 2012, between Esso Petroleum Company, Limited and Cosan S.A. Indústria e Comércio (incorporated by reference to Exhibit 4.11 of Cosan Limited’s annual report on Form 20‑F for the year ended March 31, 2013).
4.9
Share Purchase Agreement for the acquisition of Comgás dated May 28, 2012, between Integra Investments B.V., BG Energy Holdings Limited, Provence Participações S.A. and Cosan S.A. Indústria e Comércio (incorporated by reference to Exhibit 4.12 of Cosan Limited’s annual report on Form 20‑F for the year ended March 31, 2013).
4.10
Deed of Merger Cosan Limited and Cosan S.A. (incorporated by reference to Exhibit 4.13 of Cosan S.A.’s annual report on Form 20‑F for the year ended December 31, 2020).
4.11
English translation of the Merger and Justification Protocol between Cosan Limited and Cosan S.A. (incorporated by reference to Exhibit 4.14 of Cosan S.A.’s annual report on Form 20‑F for the year ended December 31, 2020).
4.12
English translation of the Merger and Justification Protocol between Cosan Logística and Cosan S.A. (incorporated by reference to Exhibit 4.15 of Cosan S.A.’s annual report on Form 20‑F for the year ended December 31, 2020).
4.13
English translation of the Protocol and Justification of Merger of Cosan Investimentos e Participações S.A. into Cosan S.A. dated as of October 27, 2021 (incorporated by reference to Exhibit 4.16 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2021).
4.14
English translation of the Master Derivatives Agreement dated October 5, 2022, between Cosan Oito S.A. and Banco J.P. Morgan S.A. (incorporated by reference to Exhibit 4.15 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2022).
4.15
Schedule dated October 5, 2022, to the Master Derivatives Agreement dated as of October 5, 2022, between Cosan Oito S.A. and Banco J.P. Morgan S.A. (incorporated by reference to Exhibit 4.16 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2022).
4.16
English translation of the Master Derivatives Agreement dated October 5, 2022, between Cosan Oito S.A. and Banco Citibank S.A. (incorporated by reference to Exhibit 4.17 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2022).
4.17
Schedule dated October 5, 2022, to the Master Derivatives Agreement dated as of October 5, 2022, between Cosan Oito S.A. and Banco Citibank S.A. (incorporated by reference to Exhibit 4.18 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2022).
4.19
Loan Agreement dated October 7, 2022, among Cosan Oito S.A., Citibank, N.A., London Branch, and Citigroup Global Markets Brasil, Corretora de Câmbio, Títulos e Valores Mobiliários S.A. (incorporated by reference to Exhibit 4.20 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2022).
4.20
Confirmation of Derivative Transaction – Collar Plus Forward dated October 7, 2022, among Cosan Oito S.A. and Banco J.P. Morgan S.A. (incorporated by reference to Exhibit 4.23 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2022).*
4.21
Confirmation of Derivative Transaction – Collar Plus Forward dated October 7, 2022, among Cosan Oito S.A. and Banco Citibank S.A. (incorporated by reference to Exhibit 4.24 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2022).*
4.22
English translation of the Investment Agreement dated as of September 21, 2025 between Aguassanta Investimentos S.A., Queluz Holding Limited, certain Class A funds of Perfin Rally Fundo de Investimento em Participações Multiestratégia Responsabilidade Limitada, Classe Única BTG Pactual Infraestrutura III Fundo de Investimento em Participações Multiestratégia, Classe Única Fundo de Investimento em Participações BPAC3 – Multiestratégia Responsabilidade Limitada and Cosan S.A. and Aguassanta Um Participações S.A. as intervening-consenting parties.
4.23
English translation of the Shareholders’ Agreement dated as of November 7, 2025 between Aguassanta Investimentos S.A., Queluz Holding Limited, Classe do Perfin Rally Fundo de Investimento em Participações Multiestratégia Responsabilidade Limitada, Classe Única BTG Pactual Infraestrutura III Fundo de Investimento em Participações Multiestratégia, Classe Única Fundo de Investimento em Participações BPAC3 – Multiestratégia Responsabilidade Limitada, BTG Pactual Co-Investimento Cosan Fundo de Investimento em Participações Multiestratégia Responsabilidade Limitada, and Vertiz Holding S.A., Cosan S.A. and Rubens Ometto Silveira Mello as intervening-consenting parties.
8.1
Subsidiaries of the Registrant.
11.1
Code of Ethics (incorporated by reference to Exhibit 11.1 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2023).
11.2
Insider Trading Policy.
12.1
Certification pursuant to section 302 of the Sarbanes‑Oxley Act of 2002 of the Chief Executive Officer.
12.2
Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002 of the Chief Financial Officer.
13.1
Certification pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, of the Chief Executive Officer.
13.2
Certification pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, of the Chief Financial Officer.
Financial Statements for the fiscal years ended March 31, 2026, 2025 and 2024 of Raízen S.A.***
97.1
Clawback Policy (incorporated by reference to Exhibit 97.1 of Cosan S.A.’s annual report on Form 20-F for the year ended December 31, 2023).
101.INS
XBRL Instance Document
101.SCH
XBRL Taxonomy Extension Schema Document
101.CAL
XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF
XBRL Taxonomy Extension Definition Linkbase Document
101.LAB
XBRL Taxonomy Extension Label Linkbase Document
101.PRE
XBRL Taxonomy Extension Presentation Linkbase Document
SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.
COSAN S.A.
Date: April 10, 2026
CONTENT
To the Shareholders and Board of Directors of Cosan S.A.
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated statement of financial position of Cosan S.A. and its subsidiaries (the “Company”) as of December 31, 2025, and the related consolidated statements of profit or loss and other comprehensive income, of changes in equity and of cash flows for the period ended December 31, 2025, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025, and the results of its operations and its cash flows for the period ended December 31, 2025 in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.
Basis for Opinions
The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management's Annual Report on Internal Control over Financial Reporting appearing under Item 15b. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audit of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Obligations related to the Raízen S.A. (“Raízen”) joint venture
As described in Notes 2.1.11, 5.8 and 10 to the consolidated financial statements, as of December 31, 2025, the Company’s balances with Raízen, an investee accounted as joint venture, comprised of an investment in the amount of zero, and by accounts receivable and accounts payable in the amounts of R$ 119,635 thousand and of R$ 277,414 thousand, respectively, recorded a loss from equity interest in the statement of profit or loss for the period then ended, in the amount of R$ 10,881,556 thousand, and disclosed in the notes to the consolidated financial statements, additional non-recorded losses from equity interest for the period then ended, in the amount of R$712,152 thousand. The Company also disclosed in the Note 2.1.11 to the consolidated financial statements, a material fact that Raízen filed an out-of-court reorganization which is being consensually negotiated with its main unsecured financial creditors. With support of specialists, management conducted several analyses, including interpretation of signed contracts, corporate documentation, and other documents related to Raízen and concluded that no additional liability should be recognized as of December 31, 2025.
The principal considerations for our determination that performing procedures relating to obligations related to the Raízen joint venture is a critical audit matter are (i) a high degree of auditor effort in evaluating audit evidence related to management’s assessment of the contracts, corporate documents and other documents related to Raízen, and (ii) the audit efforts included involving the use of professionals with specialized skill and knowledge.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included, testing the effectiveness of controls relating to management's assessment over the investment in joint ventures and the application of equity method in relation to the investment in Raízen. These procedures also included among others (i) reading the contracts, corporate documents and other documents related to Raízen, (ii) evaluating the reasonableness of management's assessment regarding the conclusion that no additional liability should be recognized in the financial statements, (iii) evaluating the accuracy of the application of the equity method, and (iv) evaluating the sufficiency of the Company's disclosures in the consolidated financial statements. Professionals with specialized skill and knowledge were used to assist in the evaluation of the Company's contracts, corporate documents, and other documents related to Raízen.
Recognition, measurement and classification of assets related to Compass’ gas concession contracts
As described in Notes 5, 11.2 and 11.3 to the consolidated financial statements, the Company´s balance associated with gas concession contracts as of December 31, 2025, comprised of: (i) indemnifiable financial asset, resulting from the right to receive indemnification from the granting authority upon the expiration of the concession agreement, in the amount of R$ 557,475 thousand; (ii) concession right intangible asset and customer relationships intangible asset (together, “gas concession right intangible asset”), a contractual right to receive cash flows from customers for construction services associated with the gas supply system, including costs incurred with customer relationships, in the amount of R$ 16,483,009 thousand, and (iii) contract assets related to the expenditures incurred in the piped gas distribution infrastructure network, in the amount of R$ 1,041,770 thousand. The recognition, measurement and classification of costs for each asset allocation between indemnifiable financial asset and gas concession right intangible assets upon completion of the construction phase, as well as the assessment of the expected useful lives of the related assets and the remaining term of the concession agreements, involved significant amounts and required the application of management judgment.
The principal considerations for our determination that performing procedures relating to the recognition, measurement and classification of indemnification financial asset, gas concession right intangible asset and contract assets is a critical audit matter are (i) the significant judgment by management in assessing the capitalization amounts and criteria, as well as the useful life of the asset for classification between indemnification financial asset and gas concession right intangible asset after the completion of the construction, and (ii) a high degree of auditor judgment, subjectivity and effort in evaluating management’s assessment of the significant amount of costs capitalized and if these met the capitalization criteria and the classification of the costs incurred between indemnification financial asset and gas concession right intangible asset.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management's evaluation of the recognition, measurement and classification of the expenditures incurred in the construction phase, initially classified as contractual asset, and of the classification of such expenditures, after the conclusion of the construction, between the indemnifiable financial asset and gas concession right intangible asset. These procedures also included among others (i) testing of capitalized costs, by assessing whether the capitalized costs meet the capitalization criteria, including interest on loans during the construction phase and (ii) testing the classification of the capitalized costs as indemnification financial asset, gas concession right intangible asset and contract assets, taking into consideration the useful life of the asset and the concession term period.
Measurement of the fair value of investment properties
As described in Note 11.5 to the consolidated financial statements, the Company’s consolidated investment property balance as of December 31, 2025, represented by agricultural properties, in the amount of R$18,221,781 thousand, are measured at fair value. The fair value is estimated by management using the following pricing models: direct comparative method of market data applied to transactions involving comparable properties and, to a lesser extent, using sales quotes for potential transactions involving comparable assets. The significant assumption used by management to measure the investment properties at fair value included price market surveys, normalization of values and spot market prices and involved external specialists.
The principal considerations for our determination that performing procedures relating to fair value measurement of investment properties is a critical audit matter are (i) the significant judgment by management when developing the assumptions for calculating the fair value (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to property prices in the spot market, normalization of property values, sale prices practiced in each region and the discount rate; and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the measurement of the fair value of investment properties. These procedures also included among others (i) evaluating the appropriateness of the pricing model used in developing the fair value estimate of the investment properties, (ii) testing the reasonableness of the assumptions adopted in the identification and measurement of fair values, and (iii) testing the completeness and accuracy of the underlying data provided by management. Professionals with specialized skill and knowledge were used to assist in the evaluation of Company's measurement of the fair value of investment properties.
/s/PricewaterhouseCoopers Auditores Independentes Ltda.
São Paulo, Brazil
April 10, 2026
We have served as the Company’s auditor since 2025.
Shareholders and Board of Directors
São Paulo - SP, Brazil
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated statement of financial position of Cosan S.A. and its subsidiaries (the “Company”) as of December 31, 2024, the related consolidated statements of income and comprehensive income, changes in equity, and cash flows for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).
Basis for opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
São Paulo, Brazil, April 30, 2025.
/s/ BDO RCS Auditores Independentes SS Ltda.
We have served as the Company's auditor from 2024 to 2025.
(In thousands of Brazilian reais - R$)
Consolidated
Note
December 31, 2025
December 31, 2024
Assets
5.2
27,243,683
16,903,542
Restricted cash
45,781
28,006
Marketable securities
5.3
2,588,411
3,272,941
Trade receivables
5.7
3,520,278
3,730,364
5.6
310,981
905,341
7
1,969,258
2,072,905
Receivables from related parties
199,549
197,063
Income tax receivable
1,166,622
793,721
Other current tax receivable
6
1,022,881
886,136
Dividend receivable
17
35,410
153,548
Sectorial financial assets
5.10
338,332
221,947
Other financial assets
612
675
Other current assets
993,667
629,426
39,435,465
29,795,615
Current assets held for sale
8
652,168
978,788
Current assets
40,087,633
30,774,403
148,885
265,370
404,182
113,360
182,987
146,297
Deferred tax assets
15
3,703,864
4,495,296
20,348
202,826
195,821
264,308
Other non-current tax receivable
1,815,830
1,334,553
Judicial deposits
16
1,072,982
1,056,690
1,956,127
2,893,987
390,622
509,695
Other non-current assets
919,706
739,386
5,193
3,820
Investment in associates
9.1
1,721,308
10,678,566
Investment in joint ventures
10
60,356
10,545,044
26,795,725
23,019,016
26,706,626
26,330,785
Contract assets
11.3
1,044,613
1,114,830
11.4
9,662,929
9,958,751
Investment property
11.5
18,221,781
16,818,919
Non-current assets
95,029,885
110,491,499
135,117,518
141,265,902
The accompanying notes are an integral part of these consolidated financial statements.
Consolidated statement of financial position
Liabilities
Loans, borrowings and debentures
5.4
3,918,720
4,403,148
5.5
982,991
1,007,533
1,909,404
2,504,117
5.9
4,078,511
5,168,593
Employee benefits payables
771,618
794,906
Income tax payables
153,310
414,823
Other taxes payable
14
525,208
637,842
226,484
96,722
Reduction of capital payable
486,285
Concessions payable
13
189,076
166,273
Related party payables
320,916
416,410
96,719
64,718
5
1,096,884
770,103
Other current liabilities
1,192,397
895,223
15,462,238
17,826,696
Liabilities related to assets held for sale
86,138
15,548,376
17,912,834
60,308,411
62,052,278
5,429,809
5,502,220
5.13
3,844,648
771,265
966,087
18,991
19,256
23,406
19,101
176,702
255,245
78,872
2,058,122
2,044,633
3,799,169
3,554,917
1,166
1,078
Post-employment benefits
23
536,426
526,620
Deferred tax liabilities
6,125,221
5,973,506
2,168,542
1,975,521
Deferred income
14,355
16,589
2,804,606
297,736
Other non-current liabilities
399,799
749,919
88,559,510
83,954,706
Total liabilities
104,107,886
101,867,540
Shareholders’ equity
Share capital
10,282,739
8,832,544
Treasury shares
(76,150
(50,708
Additional paid-in capital
4,194,210
2,205,878
Accumulated other comprehensive income
625,554
565,855
Retained losses
(9,722,125
(649,805
5,304,228
10,903,764
9.3
25,705,404
28,494,598
Total shareholders' equity
31,009,632
39,398,362
Total liabilities and shareholders' equity
(In thousands of Brazilian reais - R$, except earnings (loss) per share)
For the year ended December 31,
2025
2024
2023
19
40,418,596
43,950,742
39,468,497
20
(27,242,987
(30,236,061
(28,549,896
13,175,609
13,714,681
10,918,601
(1,850,143
(1,575,890
(1,350,570
(2,527,748
(2,845,282
(2,527,974
21
3,161,271
1,549,834
3,924,377
(1,493,752
(3,155,400
(2,710,372
(6,026,738
45,833
10,465,237
7,687,943
10,964,434
(4,672,396
219,922
1,719,031
350,399
(10,885,023
(1,229,980
1,695,945
(10,665,101
(4,183,345
2,046,344
(8,949,615
(7,637,116
(11,337,430
3,583,317
2,655,899
3,028,134
2,397,352
(5,741,359
1,777,438
(4,822,475
1,972,859
(1,365,169
22
(7,791,421
(8,749,717
(7,897,027
(7,991,285
(5,245,119
5,113,751
(1,286,327
(1,952,203
(1,645,063
(916,789
(1,238,319
1,370,637
(2,203,116
(3,190,522
(274,426
(10,194,401
(8,435,641
4,839,325
273,875
45,419
(8,161,766
4,884,744
Other comprehensive income:
Items that will not be reclassified to profit or loss:
Remeasurement gain on defined benefit plans
2,536
150,895
18,290
Loss in fair value of financial liabilities designated at fair value through profit or loss attributable to changes in credit risk
(89,260
Income tax impact
25,717
(43,580
(65,513
(61,007
107,315
(47,223
Items that are or may be reclassified subsequently to profit or loss:
Foreign currency translation differences
(55,037
537,111
(172,501
Gain (loss) on cash flow hedge
242,266
(538,256
(132,344
(42,007
144,605
7,111
145,222
143,460
(297,734
Total other comprehensive income (loss), net of tax
84,215
250,775
(344,957
Comprehensive (loss) income from continued operations
(10,110,186
(8,184,866
4,494,368
Comprehensive income from discontinued operations
Total comprehensive (loss) income for the year
(7,910,991
4,539,787
(Loss) profit attributable to:
(9,423,795
1,094,391
(472,276
1,262,029
3,790,353
Total comprehensive income (loss) attributable to:
(9,647,426
(9,172,265
841,170
(462,760
1,261,274
3,698,617
(Loss) earnings per share of continued operations
Basic
R$(3.89
R$ (5.16
R$ 0.58
Diluted
R$(3.94
Earnings per share of discontinued operations
R$—
R$ 0.10
R$ 0.01
Treasury share
Retained earnings
Equity attributable to controlling shareholders
Interest of non-controlling shareholders
Total equity
As at January 1, 2023
8,402,544
(107,140
2,319,928
567,546
9,470,289
20,653,167
27,516,232
48,169,399
Profit for the year
Other comprehensive income
Loss from cash flow hedge
(92,491
(32,742
(125,233
(109,134
(63,367
Remeasurement (loss) gain on defined benefit plans, net of tax
(51,596
4,373
Total comprehensive income (loss) for the year
(253,221
Transactions with owners of the Company
Contributions and distributions:
Capital increase
280,000
(280,000
Funds from capital increase and decrease in subsidiary
6,657
Gain from capital increase in a subsidiary
60,348
10,830
71,178
Share based payments
13,223
(40,113
(26,890
(79,565
(106,455
Write-off of interest in subsidiary
(22,280
Dividends and allocation of results
(520,691
(1,581,323
(2,102,014
Mandatory minimum dividends
(273,598
Business combination
237,460
Employee share schemes - value of employee services
135,653
50,664
186,317
Total contributions and distributions
155,888
(1,074,289
(625,178
(1,377,557
(2,002,735
Transactions with owners of the Company:
Gain on dividends from subsidiary
79,825
188,581
268,406
Change of shareholding interest in subsidiary
6,323
Total transactions with owners of the Company
86,148
274,729
Total transactions with owners of the Company contributions and distributions:
242,036
(539,030
(1,188,976
(1,728,006
As at December 31, 2023
8,682,544
(93,917
2,561,964
314,325
9,490,391
20,955,307
30,025,873
50,981,180
Retained earnings (loss)
As at January 1, 2024
Loss (profit) for the year
)
(303,494
(90,157
(393,651
466,811
70,300
Remeasurement gain on defined benefit plans, net of tax
88,213
19,102
251,530
Transactions with owners of the Company contributions and distributions:
150,000
(150,000
Loss arising from capital reduction of a subsidiary
(60,111
(634,660
(694,771
Share-based payment
114,827
(202,625
(87,798
13,367
(74,431
Loss in dividend distribution to non-controlling shareholders
(712
1,141
429
(566,401
(2,382,267
(2,948,668
Own shares acquired
(190,593
Cancellation of treasury shares
118,975
(118,975
574,598
Disposals of assets held for sale
(372,030
29,819
4,330
34,149
43,209
(352,604
(716,401
(875,796
(2,795,521
(3,671,317
(3,482
2,972
(510
Total transactions with owners of the Company contributions and distributions
(356,086
(879,278
(2,792,549
(3,671,827
As at December 31, 2024
As at January 1, 2025
Gain from cash flow hedge
192,617
7,642
200,259
(85,689
30,652
Remeasurement gain (loss) on defined benefit plans, net of tax
5,903
(4,931
972
(38,132
(23,847
(61,979
Gain on measurement of derivative financial instrument
(15,000
59,699
Capital increase (note 17 (a))
2,100,000
8,170,000
10,270,000
(11,215
Own shares acquired (note 17 (b))
(34,022
Share-based payments
8,580
2,553
11,133
17,436
28,569
Absorption of accumulated losses (note 17 (a))
649,805
(2,831,692
44,015
3,613
47,628
1,450,195
(25,442
8,216,568
10,291,126
(2,821,858
7,469,268
Change of shareholding interest in subsidiary and other transactions (note 9.1)
(6,124,205
376,393
(5,747,812
Effect arising from capital increase in subsidiary
(119,031
119,031
(6,243,236
495,424
1,973,332
4,047,890
(2,326,434
1,721,456
As at December 31, 2025
Consolidated statement of cash flows
Cash flows from operating activities
Adjustments for:
3,890,832
3,868,583
3,364,943
3,155,400
4,672,396
Interest in earnings (losses) of associates
(219,922
(1,719,031
(350,399
Interest in earnings (losses) of joint ventures
10,885,023
1,229,980
(1,695,945
Loss (gain) on disposed assets
99,324
(141,863
17,016
24
71,725
65,901
207,713
Change in fair value of investment properties
(1,441,276
(1,273,033
(2,259,924
333,659
313,876
204,158
Interest, derivatives, monetary and foreign exchange, net
9,789,736
10,217,952
9,379,506
Sectorial financial assets and liabilities, net
116,465
(37,061
(110,125
Provisions for employee benefits
465,482
454,930
419,241
Allowance for expected credit losses
44,478
52,839
74,706
Profit on sale of investment
(32,375
383,205
Revenue from insurance claims
(940,596
3,318
(597,998
Income from finance investments
(9,143
(1,284,647
Previously recognized gain in other comprehensive income reclassified to profit
(206,388
(79,302
(267,335
245,043
16,270,189
15,734,938
12,727,039
Variation in:
Trade receivable
539,734
546,218
573,737
(107,767
159,667
(83,166
Other taxes, net
(921,007
(641,866
(455,478
Income taxes paid
(1,240,674
(1,200,228
(361,726
Related parties, net
(128,327
105,490
(188,798
(246,613
(180,867
(252,810
Employee benefits
(515,510
(542,241
(356,210
(319,801
(305,324
(461,574
(48,773
(9,192
2,894
75,083
(26,275
(566,058
(36,729
(149,118
(22,862
Post-employment benefit obligation
(42,888
(37,549
(34,235
Other assets and liabilities, net
(250,133
(372,367
(244,309
(3,243,405
(2,653,652
(2,450,595
Net cash generated from operating activities
13,026,784
13,081,286
10,276,444
Cash flows from investing activities
Capital contribution to associates
(15,678
(29,997
(47,300
Capital reduction in associates
26,548
Capital contribution in joint ventures
(12,337
Acquisition of subsidiary, net of acquired cash
(615,638
(962,378
(702,577
Sale (purchase) of marketable securities, net
988,885
551,003
(507,976
(56,756
42,012
(60,498
Dividends received from subsidiaries and associates
107,424
1,018,794
254,905
Dividends received from joint venture
45,640
293,912
906,534
Dividends received from finance investment
87,608
1,305,410
(134
(621
(7,485
Cash in the incorporation operation
99,040
Acquisition of property, plant and equipment, intangible and contract assets
(8,459,867
(7,834,521
(6,267,962
Proceeds from the sale of investments
8,945,294
2,725,625
645,772
Related parties
25,592
Operation discontinued
7,425
24,510
62,700
Acquisition of subsidiary
(251,706
(17,047
Receipt of derivative financial instruments, except debt
1,021
103,147
168,308
Payment of derivative financial instruments, except debt
(1,130,390
(427,293
(156,600
Cash received on the sale of fixed assets and intangible assets
9,474
36,934
4,637
Cash received of insurance compensation for loss of fixed asset
209,186
Net cash used in investing activities
(76,072
(4,488,257
(4,303,092
Cash flows from financing activities
Proceeds from loans, borrowings and debentures
11,546,508
16,983,225
12,785,628
Principal repayment of loans, borrowings and debentures
(14,293,953
(12,187,560
(8,054,763
Payment of interest on loans, borrowings and debentures
(4,732,362
(4,759,976
(3,552,292
Payment of derivative financial instruments
(2,841,877
(2,860,601
(2,851,267
Proceeds from derivative financial instruments
1,019,179
1,144,473
1,193,534
Costs of banking operations with derivatives
(29,828
(586,855
Principal repayment of leases
(744,582
(694,340
(490,012
Payment of interest on leases
(427,965
(377,269
(236,948
10,280,240
(498,004
(204,967
(24,281
Payments to redeem entity’s shares and acquisition of treasury shares
(192,915
(103,283
Acquisition of non-controlling shareholders’ shares- Cosan Nove
2.1.6
(2,169,000
Acquisition of non-controlling shareholders’ shares - Cosan Dez
2.1.10
(3,577,760
Dividends paid
(1,698,703
(2,779,081
(2,582,447
Dividends paid for preferred shares
(994,592
(668,022
Gain on banking operations with derivatives
22,100
20,993
Cash received from financing secured by shares
2.1.9
2,792,853
Cash received from issuance of preferred shares of subsidiary
4,000,000
Payment of share-based compensation
(13,597
Net cash used in financing activities
(2,351,940
(6,605,868
(4,516,583
Increase in cash and cash equivalents
10,598,772
1,987,161
1,456,769
Cash and cash equivalents at the beginning of the year
14,658,481
13,301,716
Effect of the foreign exchange rate changes
(258,631
257,900
(100,004
Cash and cash equivalents at the end of the year
Non-cash transactions:
The Company prepares its cash flow statements using the indirect method. For the year ended December 31, 2025, the following transactions did not involve cash or cash equivalents and therefore are not reflected in the cash flow statements:
Classification of dividends and interest on shareholders' equity:
Dividends and interest on shareholders' equity received are classified as cash flows from investing activities. Dividends and interest on shareholders' equity paid are classified as cash flow from financing activities.
Notes to the consolidated financial statement
Cosan S.A. ("Cosan" or "the Company") is a publicly held Brazilian corporation listed on the Novo Mercado, the highest corporate governance tier of B3 S.A. — Brasil Bolsa Balcão ("B3"), under the trading symbol "CSAN3." The Company's American Depositary Shares (ADSs) are listed on the New York Stock Exchange (NYSE) under the ticker symbol "CSAN." Cosan is a sociedade anônima incorporated under the laws of Brazil with no fixed term and is headquartered in São Paulo, State of São Paulo. The Company's controlling shareholder is Mr. Rubens Ometto Silveira Mello.
As of December 31, 2025, the Cosan Corporate segment comprises the following entities:
Public share offering transactions
In September 2025, Cosan S.A. announced a strategic agreement with anchor investors — represented by the Aguassanta holding companies and institutional funds from BTG Pactual and Perfin — to conduct two primary public offerings of shares. As part of this arrangement, Vertiz Holding S.A. ("Vertiz") was incorporated as a new holding company to consolidate these investors' joint ownership interest in the Company.
Notes to the consolidated financial statement(In thousands of Brazilian reais - R$, except when otherwise indicated)
In November 2025, the offerings were completed at a price of R$ 5.00 per share. The first offering issued 1,812,500,000 common shares, including an overallotment option (green-shoe) of 362,500,000 shares, raising R$ 9,062,500,000. The anchor investors subscribed for 1,450,000,000 shares through Vertiz, subject to a four-year lock-up on half of the shares.
The second offering issued 287,500,000 shares, including an overallotment option of 100,000,000 shares, raising R$ 1,437,500,000, with preemptive rights granted to existing shareholders.
On November 7, 2025, a shareholders' agreement was signed between the Aguassanta holdings, the investing funds, and Vertiz. With a twenty-year term, the agreement established a bound vote for 1,125,184,190 shares (28.42% of total share capital following both offerings, excluding treasury shares).
The offerings resulted in total net proceeds of R$ 10,270,000, of which R$ 8,170,000 was allocated to the capital reserve and R$ 2,100,000 to share capital. Consequently, the share capital increased from R$ 8,182,739 to R$ 10,282,739 (Explanatory Note 17), with a total issuance of 2,100,000,000 new shares.
The net proceeds were earmarked for strengthening the capital structure, credit profile, and liquidity of the Company and its subsidiaries. The offerings were registered automatically with the CVM, without a supplementary lot or price stabilization.
On January 30, 2026, Vertiz redeemed Class C and Class D registered preferred shares by delivering shares issued by the Company to the respective holders, reducing its direct stake in Cosan from 36.56% to 24.19%. As a result, FIP BTG Pactual Multiestratégia III (BPAC3) now directly holds 8.36% of Cosan's voting capital, alongside other BTG Pactual funds (1.31% and 0.86%) and Perfin Rally FIP (1.83%).
The shareholder block maintained its consolidated stake unchanged, and control of the Company remained stable, as the Shareholders' Agreement ensures the coordination of votes for the entire block.
2. Significant events and debt instruments incurred in the year
2.1.1 - Acquisition of DIPI Holding Ltda. by Moove
On September 29, 2024, indirect subsidiary Cosan Lubrificantes e Especialidades S.A. ("CLE" – Moove segment) entered into a share purchase agreement to acquire 100% of the shares of DIPI Holding Ltda. ("DIPI") for a purchase price of R$ 329,006. The transaction was completed on January 2, 2025, following satisfaction of all closing conditions. The Company performed the allocation of the purchase price to identifiable assets acquired and liabilities assumed, as detailed in Note 9.2.
2.1.2 - Disposal of equity interest in Vale S.A.
On January 16, 2025, the Company disposed of 173,073,795 common shares of Vale S.A. ("Vale"), representing 4.05% of its share capital, for net proceeds of R$ 8,892,802, net of brokerage commissions.
Following this transaction, the Company retained a holding of 4,268,720 common shares of Vale, equivalent to 0.10% of share capital, with a carrying amount of R$ 242,036. As of December 31, 2025, the fair value of this remaining position, classified as financial instruments, was R$ 307,177. Subsequently, on January 12, 2026, the Company disposed of the remaining interest for R$ 319,723.
Additionally, on January 9 and 12, 2026, the Company early-terminated its call spread derivative structure related to 4,268,720 shares. This transaction generated cash inflows of R$ 91,853.
2.1.3 - Fire at Moove lubricants plant
On February 8, 2025, a fire occurred at Moove's Ilha do Governador Complex ("CIG") in Rio de Janeiro. The incident primarily affected the finished lubricants manufacturing and bottling areas, which were non-operational at the time of the event, representing 10% of the complex's total area.
Moove immediately activated emergency and risk management protocols. Containment measures, implemented in accordance with the company's contingency plan, were effective in minimizing damage to infrastructure, the local community, and the environment. There were no casualties, injuries, or identified environmental impacts.
Moove promptly initiated its business continuity plan and currently operates its blending and filling activities with full stability through its alternative production ecosystem.
• Financial assessment of the fire
a) Operational interruption
The fire was confined to the finished lubricants manufacturing area. As of December 31, 2025, the cleanup and operational restoration plan for the affected area was substantially complete. All other CIG operations (bulk lubricants and base oil operations, tank terminals, maritime operations, and pier operations) remained fully operational without interruption.
To mitigate the impacts on the affected areas, Moove implemented the following measures:
b) Write-off of property, plant and equipment
Moove engaged a specialized third-party firm, familiar with its operations, to perform a physical inventory of damaged and unaffected assets at the CIG. The scope of the engagement covered: (i) determining the actual extent of loss; (ii) identifying and cataloging affected assets; and (iii) quantifying accounting write-offs (net carrying amount after accumulated depreciation), in accordance with IAS 36 – Impairment of Assets. Additionally, Moove conducted internal due diligence and on-site inspections of the directly impacted area and adjacent zones exposed to intense heat or chemicals used in fire suppression.
Based on these assessments, a definitive write-off of damaged property, plant and equipment totaling R$ 51,288 was recognized as of December 31, 2025, recorded in the income statement within other net operating income (expenses).
c) Inventory write-offs
Following the incident, an assessment of inventory losses was performed, including products located directly in the impacted area and adjacent zones (which underwent qualitative chemical changes due to exposure to high temperatures). As of December 31, 2025, total inventory losses amounted to R$ 35,996, with reversal of related tax credits in the amount of R$ 11,406, resulting in total recognized losses of R$ 47,402 charged to cost of goods sold.
d) Insurance recoveries received and receivable
Moove maintains an active insurance policy covering material damage and business interruption losses. Technical analysis were performed and independent reports were issued by qualified adjusters, in addition to a coverage confirmation letter issued by the insurers on June 30, 2025, attesting to the existence of and entitlement to insurance coverage. From that date forward, Moove became entitled to receive insurance recoveries for both material damage and business interruption.
To quantify the recoveries, independent firms specialized in large-loss insurance calculations were engaged.
On December 19, 2025, a final settlement agreement was executed between the parties, securing receipt of the full insurance recovery for operational losses in the amount of R$ 933,683. Of this amount, R$ 500,000 had already been received in 2025 as an interim payment.
As of December 31, 2025, the balance of insurance recoveries receivable recognized in the Company's current assets totaled R$ 433,683, recorded in other operating income. The full amount was settled by the insurers during January 2026.
2.1.4 - Rumo Malha Norte S.A. corporate reorganization
On February 19, 2025, Rumo S.A. (“Rumo”) and Rumo Malha Norte S.A. (“Rumo Malha Norte”) approved a corporate reorganization to simplify their structure. The process involved Rumo's acquisition of the non-controlling shareholders' interests in Rumo Malha Norte (0.26% of share capital), in the amount of R$ 18,774, making it a wholly owned subsidiary, with minority shareholders receiving Rumo shares in exchange. Following the statutory appraisal rights period in July, the share transfer was completed on August 14, 2025.
2.1.5 - Cosan Dez share capital reduction
On February 27, 2025, the Company received the amount of R$ 1,013,760 related to the share capital reduction of Cosan Dez Participações S.A. (“Cosan Dez”), approved at an Extraordinary General Meeting held on June 26, 2024.
2.1.6 - Redemption of Cosan Nove preferred shares
On March 31, 2025, the Company redeemed 1,087,179,567 preferred shares of Cosan Nove, previously held by Banco Itaú, for R$ 2,169,000. Following the transaction, the preferred shares were converted into common shares, increasing the Company's ownership interest in Cosan Nove to 87.27%, with a resulting change in ownership interest of R$ 975,073 (see Note 9.1).
2.1.7 - Termination of Terminal XXXIX share sale agreement
On June 5, 2025, Rumo announced the termination of the share sale agreement for Terminal XXXIX de Santos S.A. (“Terminal XXXIX”) due to non-satisfaction of contractual closing conditions. The termination was executed without penalties, fines, or reimbursement obligations, maintaining Rumo's 50% equity interest in Terminal XXXIX.
As a consequence of the termination, the investment was reclassified from "non-current assets held for sale" to "investments in subsidiaries". Equity method results were recognized for both the current period and the prior period during which the asset had been classified as held for sale, totaling R$ 50,877.
2.1.8 - Rumo S.A. dividend payment
On June 11, 2025, Rumo approved a dividend distribution from retained earnings in the amount of R$ 1,500,000. Payment was made on June 25, 2025, with the Company receiving R$ 455,893, without monetary adjustment or interest accrual between the approval date and the actual deposit date.
2.1.9 - Sale of RAIL3 shares and total return swap
In December 2025, the Company disposed of a total of 184,700,000 shares of Rumo through an auction on B3, equivalent to 9.94% of its equity interest. Simultaneously, on December 15 and 22 of the same month, it entered into Total Return Swap ("TRS") transactions with Banco Santander (Brasil) S.A. ("Santander") and BNP Paribas Brasil S.A. ("BNP"). The contracts have as underlying assets 92,500,000 and 92,200,000 Rumo common shares (B3 ticker: RAIL3), respectively, totaling a notional amount of R$ 2,794,724. The TRS agreements, maturing in January 2027, provide economic exposure to share price fluctuations and distributions, in exchange for payment of a rate equivalent to the Brazilian Interbank Deposit Certificate ("CDI") rate plus a spread. The contracts were accounted for as financing arrangements, with Rumo shares pledged as collateral, and the corresponding financial liability was classified and subsequently measured at amortized cost.
Although formal disposal of the shares occurred in the market, there was no substantial transfer of risks and rewards associated with the original investment, due to the simultaneous execution of TRS agreements that restored the Company's full economic exposure to the disposed shares. Accordingly, derecognition of the investment in the subsidiary did not occur, and Rumo continues to be fully consolidated.
Total net proceeds from the transaction, after transaction costs, amounted to R$ 2,792,853. After interest adjustments, the final balance on December 31, 2025, was R$ 2,804,606.
2.1.10 - Transactions with Cosan Dez preferred shareholders
On December 30, 2025, at an Extraordinary General Meeting of subsidiary Cosan Dez, shareholders approved (i) a share capital increase of R$ 153,592 through the issuance of 30,675,567 no-par-value common shares; and (ii) an interim dividend distribution totaling R$ 623,591, paid exclusively to holders of Cosan Dez non-voting preferred shares.
On the same date, Cosan Dez approved:
Also on December 30, 2025, Cosan entered into a shareholders' agreement with Bradesco and BTG Holding. Under the agreement, Bradesco acquired 174,856,299 Class A preferred shares for R$2,000,000, and BTG acquired 174,856,299 Class B preferred shares for R$2,000,000.
The agreement includes (i) a put option that grants the investors the right to require the Company to repurchase the preferred shares on the dates stipulated in the contract; and (ii) a call option that grants the Company the right to repurchase the preferred shares on the same dates. Because exercise of the put option is substantively inevitable after the contractual term, the Company recognized a financial liability of R$3,844,648, representing the present value of the obligation to repurchase the shares issued by subsidiary Cosan Dez. The liability is classified as a non-current liability under the caption" Put option liability on subsidiary shares".
The investment in Cosan Dez continues to be fully recognized as a non-current asset, with transaction costs amortized using the effective interest method (see Note 5.13).
On February 19, 2026, Bradesco exercised its conversion right under the shareholders’ agreement and converted its Class B preferred shares in Cosan Dez—representing 4.99% of the subsidiary’s share capital—into Class D preferred shares. Following the conversion, these shares represent 11.50% of Cosan Dez’s share capital.
The transaction was completed in accordance with the terms of the existing shareholders’ agreement.
2.1.11 - Going concern uncertainty related to the joint venture Raízen S.A.
Given this scenario, Raízen revised the assumptions used in the impairment tests for its assets, making the necessary adjustments and provisions. These events, combined with a high level of indebtedness, resulted in significant losses and negative shareholders’ equity of R$1,132,503 on December 31, 2025. As of the authorization date of these financial statements, no formal capital reinforcement agreement had been executed.
On March 4, 2026, Raízen S.A. issued a material fact notice informing about measures to strengthen its capital structure, including the pursuit of a negotiated solution with its financial creditors. On March 11, 2026, Raízen S.A. filed a petition for an out‑of‑court reorganization proceeding (Recuperação Extrajudicial), an extrajudicial restructuring of a strictly financial nature, which does not cover obligations to customers, suppliers, resellers, and other commercial partners. On March 12, 2026, it was announced that the 3rd Bankruptcy and Judicial Reorganization Court of the District of São Paulo granted the processing of the out‑of‑court reorganization of Raízen and certain subsidiaries. This resulted in the suspension, for 180 days, of lawsuits and enforcement actions related to the claims covered by the proceeding, as well as a 90‑day deadline to prove the quorum required for court approval of the plan, in accordance with Law No. 11,101/2005. As further disclosed by Raízen S.A. in a material fact notice on March 11, 2026, the out‑of‑court reorganization plan may involve (i) the capitalization of the Raízen Group by its shareholders; (ii) the conversion of part of the Subject Claims into an equity interest in the company; (iii) the replacement of part of the Subject Claims with new debt; (iv) corporate reorganizations aimed at segregating a portion of the businesses currently conducted by the Raízen Group; and (v) the sale of assets from the Raízen Group.
2.2.1 - Early redemption of debentures
On January 22, 2025, the Company exercised its optional early redemption right for the entire outstanding amount of the 1st Series of the 3rd Issuance debentures. These were unsecured, non-convertible plain-vanilla debentures with an original maturity date in 2028. The total redemption amount was R$ 750,000, plus pro rata interest accrued from the last interest payment date to the effective redemption date, and the redemption premium stipulated in the indenture.
2.2.2 - Early redemption of Senior Notes due 2027 (“Bond 2027”)
On January 29, 2025, the Company notified the market of its decision to exercise the early redemption clause on the Bond 2027. The full redemption, in the amount of U.S.$ 392,000 thousand (equivalent to R$ 2,250,825 on the payment date), was completed on March 14, 2025, at par value.
2.2.3 - Tender offers for Bonds and Debentures
During the year, the Company executed partial repurchases of its 5th and 6th debenture Issuances and securities issued by Cosan Luxembourg S.A. ("Cosan Lux"), specifically the 2029, 2030, and 2031 Bonds, as detailed in the table below:
Notes
Principal amount repurchased
Consideration paid upon repurchased
Interest paid
Premium
Gain/Loss
5.50% Senior notes – 2029
1,347,741
1,228,072
(30,487
(67,135
52,534
7.50% Senior notes – 2030
1,600,016
1,572,518
(17,055
(80,379
(52,881
7.25% Senior notes – 2031
1,637,819
1,588,054
(18,008
(82,112
(32,347
5th and 6th Debentures
1,152,469
(52,384
(17,714
2.2.4 - Early repayments
On February 12 and 13, 2025, the Company prepaid Loan 4.131 and debentures in the amounts of U.S.$ 600,000 thousand (equivalent to R$ 3,462,660) and U.S.$ 300,000 thousand (equivalent to R$ 1,733,640), respectively. These loan and debenture facilities had originally been contracted in February 2024 and December 2023, respectively.
Concurrently with the early repayments, the related TRS and interbank time deposit transactions that had been structured to support foreign currency-denominated funding through foreign exchange hedging were terminated.
On January 16, 2026, Cosan S.A. announced the full early redemption of the first series of its 4th and 6th debenture issuances. Both series had a redemption date of February 2, 2026, for the following amounts:
In addition, Cosan’s subsidiary Cosan Luxembourg S.A. exercised the early call clause on the bonds maturing in 2029, with full redemption on February 17, 2026.
These actions form part of the Company’s liability management strategy, which aims to reduce indebtedness and strengthen its capital structure.
On February 2, 2026, Cosan S.A. informed the market of the continuation of its liability management process, as outlined in the public offerings completed in 2025. In this context, its wholly owned subsidiary, Cosan Luxembourg S.A., fully redeemed the senior notes maturing in June 2030 (“Bond 2030”), with a principal amount of US$269,334 thousand, and the senior notes maturing in January 2031 (“Bond 2031”), with a principal amount of US$300,000 thousand.
With the redemptions described above, the Company has repaid approximately R$6.2 billion in debt to date. This reinforces its commitment to reducing indebtedness, lowering financial costs, and improving its capital structure.
2.2.5 - Debts incurred during the fiscal year
Value
03/12/2025
(46,633
1,500,000
01/27/2029
(13,797
500,000
03/27/2030
(13,721
03/27/2032
01/10/2025
410,000
01/07/2027
02/18/2025
(18,546
800,000
01/15/2033
03/20/2025
(859
350,000
03/20/2026
05/19/2025
(2,414
05/15/2028
10/09/2025
(11,974
300,000
09/15/2037
(32,200
700,000
09/15/2040
(511
200,000
53,900
03/31/2026
(1,369
26,675
09/16/2041
(105
215,825
03/28/2025
(17,020
434,949
03/28/2037
(63,990
1,365,051
03/28/2040
09/29/2025
(46,187
1,000,000
(12,152
750,000
(1,681
26,959
09/15/2035
01/16/2025
01/18/2028
275,700
3. Statement of compliance and material accounting policies
The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS Accounting Standards”).
Only material information is disclosed in these financial statements, consistent with the information used by Management in managing the Company.
These financial statements were authorized for issue by the Board of Directors on April 10, 2026.
Accounting policies are included in the explanatory notes, except for those described below:
Functional currency and foreign currency
The consolidated financial statements are presented in reais (R$), the functional currency of the Company and its Brazilian-based subsidiaries, associates, and joint ventures, as it is the primary currency of the economic environment in which these entities operate, consume, and generate resources. The principal functional currencies of foreign-based subsidiaries are the U.S. dollar, the euro, and the pound sterling. All balances have been rounded to the nearest thousand, except where otherwise indicated.
Monetary assets and liabilities denominated in foreign currencies are translated into functional currency using the exchange rate at the balance sheet date. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rate at the date when fair value was determined. Non-monetary items measured at historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Exchange differences arising from these translations are recognized in profit or loss for the period.
Assets and liabilities of foreign operations, including goodwill and other adjustments arising from business combinations, are translated into reais using the exchange rates at the balance sheet date. Revenue and expenses of these operations are translated using the average exchange rates for the dates of the transactions.
Exchange differences arising from the translation into the presentation currency are recognized directly in shareholders' equity as part of other comprehensive income. Where a subsidiary is not wholly owned, the portion attributable to non-controlling interests is allocated directly to the corresponding component of equity.
Upon complete disposal of a foreign entity resulting in loss of control, significant influence, or joint control, the accumulated balance of translation differences related to that entity is reclassified to profit or loss as part of the gain or loss on disposal. In partial disposals with retention of control over a subsidiary, the proportional portion of the accumulated balance is reclassified to equity and attributed to non-controlling interests. In partial disposals of an associate or joint venture with retention of significant influence or joint control, the proportional portion of the accumulated balance is reclassified directly to profit or loss.
The table below presents the reference exchange rates, expressed in reais or units of foreign currency, for the periods indicated, as published by the Central Bank of Brazil ("BACEN"):
Closing rate
Average rate
Currency
December 31, 2023.
Dollar (USD)
4.84
5.45
6.10
4.90
Pound sterling (£)
6.16
7.30
7.71
6.20
Euro (€)
5.35
6.39
6.38
5.34
USE OF JUDGMENT AND ESTIMATES
In preparing these financial statements, Management has applied judgments and estimates that affect the application of accounting policies and the reported amounts of assets, liabilities, revenue, and expenses. Actual results may differ from these estimates.
The underlying estimates and assumptions are continuously reviewed and revised prospectively when necessary. Information regarding critical judgments and the main sources of estimation uncertainty that have a significant impact on the amounts recognized in the financial statements is described in the following notes:
• Note 5 – Other financial liabilities
• Note 5.5 – Leases
• Note 5.7 – Trade receivables
• Note 5.11 – Recognized Fair value measurement
• Note 8 – Assets and liabilities held for sale
• Note 9.2 – Acquisition of subsidiaries
• Note 10 – Investment in joint ventures
• Notes 11.1 and 11.2 – Property plant and equipment, intangible assets and goodwill
• Notes 11.5 – Investment Properties
• Note 12 – Commitments
• Note 15 – Income taxes
• Note 16 - Provisions for legal claims and deposits
• Note 23 – Post-employment benefits
• Note 24 – Share-based payment
The Company's senior management (the "Chief Operating Decision Maker," or "CODM") uses segment information to evaluate the performance of operating segments and make resource allocation decisions. This information is prepared on a basis consistent with the accounting policies used in the preparation of the financial statements. Earnings before interest, taxes, depreciation, and amortization ("EBITDA") are used by the Company to evaluate the performance of its operating segments
Reported segments:
Compass: core activities include (i) distribution of piped natural gas in the South, Southeast, and Central-West regions to industrial, residential, commercial, automotive, and cogeneration segment customers; (ii) natural gas marketing; and (iii) other investments under development.
Although Raízen is a joint venture accounted for under the equity method and is not proportionately consolidated, Management continues to monitor the segment information. Reconciliation for this segment is presented in the "Deconsolidation of a Joint Venture" column.
For the year ended December 31, 2025
Reported segments
Deconsolidation of a Joint Venture
Eliminations between segments
Statement of profit or loss
228,802,047
16,604,055
9,320,131
13,847,776
653,785
3,413
(228,802,047
(10,564
(219,595,323
(12,573,021
(7,036,165
(7,562,149
(82,216
219,595,323
10,564
9,206,724
4,031,034
2,283,966
6,285,627
571,569
(9,206,724
(6,034,060
(231,057
(1,560,734
(58,352
6,034,060
(2,351,926
(848,007
(655,965
(637,450
(96,000
(290,326
2,351,926
Other operation income (expenses), net
(1,468,576
658,043
916,112
123,460
1,308,677
154,979
1,468,576
(6,496,680
(1,227,872
(265,880
6,496,680
Interest in (losses) earnings of subsidiaries and associates
(24,276
116,282
101,526
2,275,269
24,276
(2,273,155
(177,680
(7,273
(10,877,750
177,680
(9,129,988
(1,637,661
(321,628
(3,025,182
63,182
(2,870,132
9,129,988
(8,263,562
(2,177,941
(301,109
(3,281,087
(4,032
(3,185,446
8,263,562
3,009,112
857,063
73,590
1,468,558
67,214
1,116,892
(3,009,112
Foreign exchange variation, net
2,834,418
180,259
65,165
686,037
1,465,891
(2,834,418
(6,709,956
(497,042
(159,274
(1,898,690
(2,267,469
6,709,956
Income tax
(5,838,506
(628,927
(103,783
(689,358
(186,368
(594,680
5,838,506
Net (loss) profit for the year
(22,314,968
1,459,707
557,968
865,126
1,661,060
(12,465,107
22,314,968
(22,257,204
1,129,707
390,394
256,763
496,291
22,257,204
(57,764
330,000
167,574
608,363
1,164,769
(2,742,982
57,764
Other selected data
9,706,642
1,247,648
406,026
2,213,331
272
23,555
(9,706,642
2,360,168
4,973,943
1,389,405
6,792,997
1,784,518
(8,976,740
(2,360,168
3,690,968
Additions to fixed assets, intangible assets and contract assets
9,876,006
2,197,125
146,112
6,096,341
10,428
9,861
(9,876,006
8,459,867
Reconciliation of EBITDA
Profit (loss) for the year, net
628,927
103,783
689,358
186,368
594,680
2,203,116
1,637,661
321,628
3,025,182
(63,182
2,870,132
7,791,421
For the year ended December 31, 2024
251,198,776
18,383,448
10,248,369
13,936,389
1,441,809
2,160
(251,198,776
(61,433
(237,636,637
(14,706,965
(7,309,994
(7,533,536
(746,956
(43
237,636,637
61,433
13,562,139
3,676,483
2,938,375
6,402,853
694,853
2,117
(13,562,139
(6,634,623
(195,472
(1,331,412
(49,006
6,634,623
(3,020,473
(818,420
(921,196
(661,678
(73,201
(370,787
3,020,473
2,029,354
858,402
84,081
(146,740
1,265,098
(511,007
(2,029,354
(6,155
(3,149,245
Interest in earnings (losses) of subsidiaries and associates
(235,631
154,487
40,348
21,531
3,509,443
235,631
(2,006,778
(7,445
(1,222,535
(7,273,308
(854,169
(181,139
(2,577,844
27,756
(5,164,321
7,273,308
(4,741,898
(1,587,619
(182,407
(3,242,246
(27,130
(2,597,714
4,741,898
995,444
977,905
129,175
1,102,136
54,886
391,797
(995,444
(4,974,022
(578,412
(212,224
(1,455,848
(3,494,875
4,974,022
1,447,168
333,957
84,317
1,018,114
536,471
(1,447,168
(1,102,531
(966,578
(194,579
(800,485
(130,285
(1,098,595
1,102,531
(Loss) profit for the year of continued operation
(2,675,073
1,848,578
394,130
(949,242
1,805,752
(9,528,081
2,675,073
Profit from discontinued operations
241,010
(241,010
2,122,453
(9,287,071
(2,247,788
(2,732,286
1,730,597
275,921
(291,680
532,950
2,732,286
57,213
391,856
118,209
(657,562
1,272,802
136,724
(57,213
10,036,600
1,088,610
460,391
2,303,380
273
15,929
(10,036,600
15,737,366
5,031,810
1,230,239
4,732,467
1,908,554
(3,008,226
(15,737,366
7,647,056
12,349,347
2,135,908
186,040
5,492,724
6,414
13,435
(12,349,347
7,834,521
(Loss) profit for the year, net
966,578
194,579
800,485
130,285
1,098,595
3,190,522
854,169
181,139
2,577,844
(27,756
5,164,321
8,749,717
For the year ended December 31, 2023
Deconsolidation of a joint Venture
221,693,298
17,767,327
10,078,626
10,937,716
743,411
2,709
(221,693,298
(61,292
(202,926,764
(14,256,031
(7,359,606
(6,838,433
(153,470
(3,648
202,926,764
61,292
18,766,534
3,511,296
2,719,020
4,099,283
589,941
(939
(18,766,534
(5,773,538
(164,399
(1,144,957
(40,658
(556
5,773,538
(2,815,532
(788,015
(645,634
(559,973
(74,355
(459,997
2,815,532
1,968,248
607,226
(336
(100,780
2,253,803
1,164,464
(1,968,248
Interest in earnings of subsidiaries and associates
(219,896
178,978
75,333
20,015
2,647,255
219,896
(2,571,182
Interest in earnings of joint ventures
1,266
1,694,679
Finance result
(5,962,849
(730,954
(319,136
(2,555,382
30,798
(4,322,353
5,962,849
(6,241,261
(1,658,582
(242,751
(3,621,093
(6,776
(5,808,228
6,241,261
797,560
1,283,024
116,408
1,190,685
37,577
400,440
(797,560
1,240,924
152,592
(155,618
368,259
(3
1,412,208
(1,240,924
(1,760,072
(507,988
(37,175
(493,233
(326,773
1,760,072
(1,936,598
(859,311
(332,090
(197,174
(147,636
1,261,785
1,936,598
Profit for the year from continuing operations
4,026,369
1,754,821
276,867
721,915
2,672,566
1,984,338
(4,026,369
20,384
(20,384
1,800,240
2,004,722
(2,591,566
3,863,605
1,410,630
193,888
218,886
768,162
(3,863,605
162,764
389,610
82,979
503,029
1,904,404
910,331
(162,764
8,071,288
899,635
273,772
2,175,834
275
15,427
(8,071,288
19,997,104
4,290,140
1,201,865
5,650,305
2,789,679
5,080,717
(19,997,104
16,421,140
11,396,056
2,317,889
177,971
3,689,877
39,892
42,333
(11,396,056
6,267,962
859,311
332,090
197,174
147,636
(1,261,785
274,426
730,954
319,136
2,555,382
(30,798
4,322,353
7,897,027
Statement of financial position:
16,787,376
3,430,108
1,246,014
7,018,132
19,614
15,529,815
(16,787,376
519,918
1,471,735
526,815
416,287
143,605
434,151
(519,918
2,992,593
7,698,087
1,541,952
1,071,055
667,292
388,864
(7,698,087
3,669,163
7,390,653
218,195
37,689
1,804,841
206,383
(7,390,653
2,267,108
13,023,684
209,199
1,496,570
263,489
(13,023,684
728,954
94,026
4,823
980
2
(94,026
5,805
16,476,770
703,324
715,511
1,204,266
33,085
1,956,812
(16,476,770
(496,920
4,116,078
8,268,816
1,896,910
262,010
3,800,660
53,257
1,943,783
(8,268,816
(45,082
7,911,538
Investment in subsidiaries and associates
757,936
1,315,190
396,810
16,077,939
(757,936
(16,068,631
1,201,730
48,847
11,509
(1,201,730
Biological assets
1,562,942
(1,562,942
2,803,105
1,041,771
2,842
(2,803,105
6,806,538
1,555,212
300,064
7,792,217
2,787
12,649
(6,806,538
31,775,056
1,942,618
861,572
23,948,573
11
42,951
(31,775,056
Intangible assets
3,520,050
17,287,600
2,985,630
6,421,681
11,715
(3,520,050
(70,013,022
(15,320,793
(4,041,589
(23,123,837
(21,740,912
70,013,022
(64,227,131
Derivatives financial instruments - Liabilities
(8,535,256
(266,293
(39,034
(1,789,709
(585,633
8,535,256
(2,680,669
(9,288,854
(1,326,372
(1,611,538
(1,138,378
(20,259
(955
9,288,854
(4,097,502
(969,579
(254,954
(134,823
(361,583
(43,664
969,579
(795,024
(2,265,261
(9,911,677
(1,323,621
(368,683
(1,691,879
(125,930
(775,130
9,911,677
494,830
(3,790,413
(8,114,646
(1,930,232
(316,221
(4,145,148
(3,054
(18,145
8,114,646
(6,412,800
(3,844,648
(2,804,606
(12,986,156
(3,223,563
(581,184
(7,484,119
(839,318
(1,108,835
12,986,156
47,187
(13,189,832
Total assets (net of liabilities) allocated by segment
(1,132,503
7,436,502
2,413,680
14,048,442
17,874,445
5,305,179
1,132,503
(16,068,616
Total Asset
118,686,687
33,347,591
9,506,752
53,783,095
18,863,006
36,227,707
(118,686,687
(16,610,633
Equity attributable to:
Controlling shareholders
(1,596,893
4,687,098
1,692,100
4,196,013
5,493,405
1,596,893
Non-controlling shareholders
464,390
2,749,404
721,580
9,852,429
12,381,040
951
(464,390
Deconsolidation of a jointly owned subsidiary
9,962,864
5,271,256
753,347
7,461,618
33,041
3,384,280
(9,962,864
1,337,706
1,074,806
303,492
812,795
251,267
943,941
(1,337,706
3,386,301
11,053,414
1,804,823
1,164,422
583,349
443,140
(11,053,414
3,995,734
17,070,322
356,589
151,926
1,647,977
1,642,836
(17,070,322
3,799,328
17,435,862
252,220
1,538,105
282,580
(17,435,862
731,642
87,966
(87,966
4,495
10,611,882
592,317
288,376
1,040,439
72,089
3,786,460
(10,611,882
(2,112,993
3,666,688
15,784,732
1,810,491
241,816
3,421,143
24,870
2,901,292
(15,784,732
(160,256
8,239,356
1,277,955
280,865
92,166
24,235,118
(15,207,538
2,012,536
41,121
10,503,923
(2,012,536
Biological Assets
3,596,878
(3,596,878
2,806,284
1,110,463
4,367
(2,806,284
9,549,136
1,581,601
316,762
8,039,779
3,053
17,556
(9,549,136
37,503,618
1,620,505
911,277
20,435,467
51,750
(37,503,618
9,472,002
16,761,631
3,013,392
6,545,890
9,872
(9,472,002
(52,781,598
(14,449,033
(3,558,575
(19,123,218
(29,324,600
52,781,598
(66,455,426
(14,464,530
(389,778
(57,347
(1,918,204
(1,104,875
14,464,530
(3,470,204
(20,042,646
(1,650,748
(1,735,704
(1,777,918
(20,549
(2,930
20,042,646
(5,187,849
(1,096,336
(253,655
(140,553
(376,475
(43,324
1,096,336
(814,007
(2,040,239
(9,327,070
(2,876,023
(428,437
(1,252,805
(135,410
(905,820
9,327,070
1,628,676
(3,969,819
(11,988,100
(2,122,306
(327,517
(4,032,188
(3,281
(24,461
11,988,100
(6,509,753
(14,143,270
(3,735,956
(548,995
(7,177,061
(580,129
(2,022,675
14,143,270
644,573
(13,420,243
Total asset (net of liabilities) allocated by segment
24,441,652
6,732,381
1,890,829
14,935,154
16,999,193
14,048,343
(24,441,652
Total asset
148,285,202
34,250,119
8,687,957
50,593,023
17,738,562
47,477,028
(148,285,202
(17,480,787
23,864,556
4,091,601
1,326,385
4,477,643
5,311,909
(23,864,556
577,096
2,640,780
564,444
10,457,511
11,687,284
3,144,579
(577,096
23,521,366
25,567,836
23,312,258
26,535,659
38,019,072
29,070,524
67,319,586
67,097,828
66,267,702
92,715,916
102,834,016
90,281,586
8,863,552
7,271,246
3,724,090
9,845,968
10,408,778
9,037,138
8,514,502
11,978,851
11,411,212
2,667,598
2,331,263
2,202,348
300,242
511,997
710,288
438,332
485,946
592,917
Commercial
924,090
878,635
820,685
Construction revenue
1,568,285
1,602,284
1,494,142
380,491
594,472
535,735
14,793,540
Marketing & services
1,810,515
8,068,803
8,794,520
8,520,267
743,454
630,349
765,408
507,874
823,500
792,951
11,111,826
11,096,559
8,346,314
1,941,834
2,154,493
2,032,703
794,116
685,337
558,699
269,231,207
295,210,951
261,223,087
Deconsolidation of joint venture, adjustments and eliminations
(228,812,611
(251,260,209
(221,754,590
Net revenue
34,743,725
38,185,302
33,816,723
89,460,884
97,433,283
Europe (i)
3,189,394
3,100,762
3,050,235
382,446
761,716
Latin America (ii)
278,167
304,074
144,853
34,375
46,929
United States of America
2,166,395
2,360,604
2,456,686
2,133,670
2,562,230
Asia and others (iii)
40,915
92,011,375
100,804,158
Main countries:
As of December 31, 2025, subsidiary Rumo had one customer whose revenue represented 10.34% of its net operating revenue, equivalent to R$ 1,323,753, corresponding to 3.3% of Cosan's consolidated net operating revenue. For the years ended December 31, 2024 and December 31, 2023, this same customer represented 12.10% and 3.07% respectively, of Rumo's net operating revenue, equivalent amounting to R$1,763,541 and R$1,213,263, respectively.
Notes to consolidated financial statement
(In thousands of Brazilian reais - R$, except when otherwise indicated)
Accounting policy:
Classification
The Company classifies its financial assets into the following measurement categories:
•Measured at fair value ( either through other comprehensive income or through profit or loss).
•Measured at amortized cost
Classification depends on the business model adopted for managing the financial assets and the contractual cash flow characteristics of the instrument. For financial assets measured at fair value, gains and losses are recognized either in profit or loss or in other comprehensive income. For debt instruments, this depends on the business model in which the investment is held.
The Company reclassifies debt securities only when there is a change in the business model for managing those assets. Financial liabilities are classified as measured at amortized cost or at fair value through profit or loss. A financial liability is classified as measured at fair value through profit or loss when:
(i) it is held for trading;
(ii) it is a derivative (except for financial guarantee contracts and forward purchase and sale contracts that are not entered into for trading purposes); or
(iii) it is designated as such at initial recognition.
Recognition and measurement
At initial recognition, the Company measures a financial asset or financial liability at its fair value, plus or minus, in the case of a financial asset or financial liability not measured at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issuance of the financial asset or financial liability. Transaction costs related to financial assets or liabilities measured at fair value through profit or loss are expensed in profit or loss.
Purchases and sales of financial assets subject to regular-way settlement are recognized on the trade date—that is, the date on which the Company commits to the irrevocable purchase or sale.
Subsequent to initial recognition, the Company measures financial assets as follows:
•Amortized cost: for assets held in a business model whose objective is to hold instruments in order to collect contractual cash flows that meet the solely payments of principal and interest ("SPPI") criterion. This category includes trade receivables, cash and cash equivalents, receivables from related parties, restricted cash, sector financial assets, and dividends and interest on equity receivable;
•Fair value through other comprehensive income ("FVOCI"): for assets held in a business model with both collection of cash flows and sale objectives, whose cash flows meet the SPPI criterion;
•Fair value through profit or loss ("FVTPL"): for all other financial assets, including derivatives and instruments that do not meet the SPPI criterion.
Financial liabilities classified at fair value through profit or loss are measured at fair value, with all changes recognized in profit or loss for the period. Other financial liabilities are measured at amortized cost using the effective interest method, with interest expense and foreign exchange variations recognized in profit or loss.
Derecognition
Financial assets are derecognized when the rights to receive cash flows have expired or have been transferred and the Company has transferred substantially all the risks and rewards of ownership.
Financial liabilities are derecognized when the contractual obligations are extinguished, cancelled, or have matured. When the terms of a liability are substantially modified—that is, when the effective interest rate of the modified liability varies by 10% or more relative to the original rate—the original liability is derecognized and a new liability is recognized at the fair value of the modified cash flows, with the resulting gain or loss recognized in profit or loss for the year. Additionally, the Company considers qualitative factors, in addition to the 10% variation, when assessing whether to derecognize the liability.
Financial assets and liabilities are presented as classified below:
Fair value through profit or loss
2,525,668
2,122,442
7,791,174
9,312,566
Amortized cost
24,718,015
14,781,100
228,768
174,303
219,897
399,889
Dividends and interest on equity receivable
Indemnifiable financial asset(ii)
557,475
416,377
31,230,664
21,709,283
39,021,838
31,021,849
(32,945,289
(38,161,392
(195,057
(246,256
Other financial liabilities (i)
(1,096,884
(1,067,839
Railroad concession payable
(3,988,245
(3,721,190
(322,082
(417,488
Obligation to repurchase shares in subsidiaries
Liabilities arising from financing secured by shares
(226,484
(96,722
Reduction of share capital payable
(486,285
Installment of tax debts
(161,182
(254,302
(58,360,040
(58,189,315
(31,281,841
(28,294,034
Other accounts payable
(11,854
(12,362
(33,974,364
(31,776,600
(92,334,404
(89,965,915
The Company's subsidiaries adopt working capital optimization strategies, including extension of payment terms with suppliers and the use of structured supply chain financing arrangements, also known as reverse factoring or buyer-led financing programs.
At Rumo, these arrangements were structured with first-tier financial institutions as direct counterparties, at an average interest rate of 14.13% p.a. (11.05% p.a. as of December 31, 2024). The average tenor of these transactions was approximately 48 days (35 days as of December 31, 2024). Liabilities to suppliers who are not part of factoring agreements have average payment terms of 45 days
In these arrangements, Rumo transfers substantially all risks and rewards associated with the trade payables to the financial institutions, resulting in derecognition of the trade payable and recognition of a financial liability at the amount of the obligation assumed vis-à-vis the bank. This accounting transfer constitutes a non-cash transaction and is therefore not presented in the Statements of Cash Flows. Settlement cash flows are classified as operating or investing activities according to the nature of the original purchase. Related financing charges are recognized within "Interest on contingencies and trade contracts" in financial income (expense), totaling R$ 45,281 for the year ended December 31, 2025 (R$ 48,275 as of December 31, 2024).
At Comgás, as of December 31, 2025, the balance of supplier receivables advanced by financial institutions was R$ 84,105 (R$ 132,999 as of December 31, 2024), with a maximum tenor of 90 days. Trade payables that are not part of supplier receivables arrangements have similar payment terms, averaging around 90 days.
In these arrangements, the decision to accelerate payment rests solely with the supplier, who negotiates directly with the financial institution. Comgás maintains the original commercial terms unchanged (payment term and amount), does not transfer credit risk to the bank, and receives no financial benefit from the institution. Accordingly, derecognition of the trade payable does not occur; the obligation remains classified as a non-financial liability until its normal maturity. Comgás exercises no influence over the supplier's decision and assumes no obligations toward the financial institution.
Under the terms of the main credit facilities, the Company and its subsidiaries are required to comply with the following financial covenants:
Company
Debt
Goal
Ratio
Cosan Luxembourg S.A.
Senior Notes due 2029
Pro forma net debt (xiv)/pro forma EBITDA (iii) cannot exceed 3.5x
3.03
Senior Notes due 2030
Pro forma net debt (iii)/pro forma EBITDA (iii) cannot exceed 3.5x
2.85
Senior Notes due 2031
* Debenture 14th issue
Net debt (ix) (excluding leases) / EBITDA (ii) cannot exceed 4.00
1.88
Debenture 7th to 13th
Net debt (viii) / EBITDA (ii) cannot exceed 4.0x
1.89
Loan 4131
Compagas
* Debenture 5th issue
Net Debt (viii) / EBITDA (ii) cannot exceed 4.0x
2.26
Sulgás
Net Debt (ix) / EBITDA (ii) cannot exceed 3.5x
0.42
The overall debt ratio (Total liabilities (x) / Total liabilities (xi) annually) cannot exceed 0.8.
0.73
* Debenture 1st issue
Net debt (ix) / EBITDA (ii) cannot exceed 4.0x
Necta
n/m (xii)
MLH
Syndicated Loan
Net debt (i)/ EBITDA (ii) cannot exceed 3.5x at the end of each quarter.
1.63
DSCR (vii) must not be less than 2.5x at the end of each quarter.
Rumo SA
* Debenture (11th, 12th, 13th and 14th) (v)
ICJ (vi) = EBITDA (ii)/ Financial results (iv) cannot be less than 2.0x
3.52
* ECA
Net debt (xiii)/ EBITDA (ii) cannot exceed 3.5x
1.94
Senior Notes due 2028
Senior Notes due 2032
* Debentures (v)
As of December 31, 2025, the Company and its subsidiaries were in compliance with all financial and non-financial restrictive covenants. The loan agreements include cross-default provisions.
Debt contracts with ESG clauses
The Senior Notes 2028 represented the first Green bond issuance in the Latin American freight rail sector. The subsidiary is committed to allocating proceeds toward full or partial financing of ongoing and future projects that contribute to promoting a low-carbon, resource-efficient transportation sector in Brazil. Eligible projects are distributed across the following categories: "Acquisition, replacement, and upgrading of rolling stock," "Infrastructure for railway section duplication, new yards, and yard extensions," and "Railway modernization."
The Senior Notes 2032 constituted a Sustainability-Linked Bond ("SLB") issuance with the following sustainability target: reduction of 17.6% in direct greenhouse gas emissions per revenue ton-kilometer ("RTK") by 2026, using 2020 as the baseline year. The subsidiary is subject to a 25 basis point step-up effective July 2027 should this target not be achieved, which would increase the interest rate to 4.45% p.a.
The 2nd Debenture of Malha Paulista is linked to a sustainability target of reducing greenhouse gas emissions per revenue ton-kilometer ("RTK") by 15% by 2023, using December 2019 as the baseline. Compliance with the step-down condition was verified based on Rumo's Annual Sustainability Report ("RAS"); consequently, the subsidiary benefited from a 25 basis point step-down, reducing the cost of the 2nd series to Broad National Consumer Price Index (Índice Nacional de Preços ao Consumidor Amplo, or "IPCA") + 4.52%.
The 17th Debenture of Rumo S.A. is linked to sustainability targets of reducing (i) direct greenhouse gas emissions per RTK by 17.6% by 2026; and (ii) 21.6% by 2030, using 2020 as the baseline year. The subsidiary is subject to a 25 basis point step-up on the 1st series and 20 basis points on the 2nd series should the 2026 SPT not be achieved, plus an additional 5 basis points on the 2nd series should the 2030 SPT not be achieved.
On November 1, 2023, subsidiary Compass issued plain-vanilla, non-convertible, unsecured debentures in the amount of R$ 1,736,385. These debentures bear semi-annual interest equivalent to CDI + 1.55% p.a., with maturities on November 1, 2029 (50%) and November 1, 2030. Proceeds from the issuance are allocated to Compass's investments and working capital reinforcement.
This 2nd debenture issuance is linked to the following ESG target:
Should one or both targets not be achieved, Compass will incur a 12.5 basis point step-up per unmet target, increasing the rate from April 2028 (verification date) to up to CDI + 1.80% p.a. As of December 31, 2025, Compass performed an assessment and identified no indications of non-compliance, as the targets were achieved.
As of the issuance date of these consolidated financial statements, there are no breachs, by the Company or its subsidiaries, of the contractual provisions related to borrowings tied to ESG targets.
Cash and cash equivalents comprise cash on hand, demand deposits, and highly liquid short-term investments with an original maturity of three months or less from the date of acquisition, which are subject to an insignificant risk of changes in value and are held for cash management purposes.
Investments in investment funds are classified as cash and cash equivalents when they cumulatively meet the following criteria: (i) they have high liquidity; (ii) they have immediate or very short redemption terms (up to 90 days); (iii) they are readily convertible into a known amount of cash; and (iv) they are subject to an insignificant risk of changes in value. Such funds are usually referenced to the CDI rate (Interbank Deposit Certificate).
All balances classified as cash and cash equivalents are measured at nominal value, which does not materially differ from amortized cost or fair value due to the short-term maturity of these assets. Financial investments that do not meet the above criteria are classified as financial assets measured at fair value through profit or loss.
Cash and bank accounts
412,340
958,738
Savings account
986,011
485,393
Financial investments
25,845,332
15,459,411
Financial investments are structured as follows:
Applications in investment funds
Repurchase agreements (i)
410,172
1,493,278
Certificate of bank deposits – CDB
964,949
604,398
Other investments
1,150,547
24,766
Applications in banks
Repurchase agreements
127,577
236,101
23,192,087
12,102,078
998,790
23,319,664
13,336,969
Marketable securities classified as financial assets measured at fair value through profit or loss comprise equity instruments (shares, investment fund units, and other capital instruments) whose fair value is readily determinable, either through trading on an organized market (B3) or by reference to observable market prices for similar assets.
Restricted cash comprises amounts pledged as contractual guarantees or earmarked for specific purposes that restrict their immediate use for the Company's ordinary operations. These balances are classified and measured at amortized cost.
Investments in marketable securities have original maturities ranging from two to five years. Although these securities maintain high liquidity in the secondary market and may be redeemed early, they are subject to an insignificant risk of changes in value.
Financial investments in listed entities
307,177
Equity financial assets (i)
2,580,460
3,114,578
7,951
158,363
ESG funds
97,005
Classification and measurement
Loans, borrowings and debentures are initially recognized at fair value, net of transaction costs, and subsequently measured at amortized cost using the effective interest method, except when: (i) designated as a fair value hedge within a documented hedging relationship; or (ii) irrevocably designated at initial recognition at fair value through profit or loss ("FVTPL").
For liabilities irrevocably designated at FVTPL, fair value changes attributable to market factors (interest rates, foreign exchange, etc.) are recognized in profit or loss for the period. The portion of the change attributable to the Company's own credit risk is recognized directly in shareholders' equity as part of other comprehensive income, to avoid a counterintuitive effect on the income statement.
Loans, borrowings and debentures are classified as Current Liabilities when maturity occurs within 12 months after the balance sheet date. They are classified as Non-Current Liabilities when the Company holds an unconditional right to defer settlement for a period exceeding 12 months from the balance sheet date.
The fair value of loans is determined using the discounted cash flow method, applying the instrument's implicit discount rate, and is classified within Level 2 of the fair value hierarchy.
Liabilities are derecognized when the contractual obligation is extinguished through settlement, cancellation, or maturity. Upon derecognition, the difference between the carrying amount of the liability and the consideration actually paid (including non-monetary assets transferred or liabilities assumed) is recognized in financial income (expense) for the year.
Financial guarantees
Financial guarantee contracts issued by the Company are initially recognized at fair value. When not designated at FVTPL, they are subsequently measured at the higher of: (i) the amount of the provision for losses obligation; and (ii) the amount initially recognized, net of accumulated amortization.
The Company may irrevocably designate financial guarantees at FVTPL when such designation eliminates or significantly reduces an accounting mismatch arising from asymmetric measurement of related assets and liabilities.
a) Composition
Interest
Description
Average debt Index
Average annual interest rate
11,548,920
10,554,301
452,845
433,499
1,028,621
1,020,037
2,785,877
3,135,174
5,924,649
14,181,589
21,740,912
29,324,600
2,794,449
3,034,743
216,351
5,551,081
5,378,989
828,619
2,695,565
392,139
54,680
5,102,678
2,956,899
380,797
382,837
15,320,794
14,449,033
15,729
571,160
2,104,141
2,346,950
259,908
272,318
282,516
316,442
274,252
549,611
607,136
4,041,588
3,558,575
494,225
299,706
1,428,087
1,861,658
27,050
27,005
814,423
874,513
261,172
14,906,454
10,722,182
Export Credit Agency ("ECA")
Euribor + 0.58%
19,543
38,525
276,661
5,145,878
5,049,973
23,123,837
19,123,218
64,227,131
66,455,426
Effective interest rates on debt with associated derivatives are disclosed in Note 5.6.
Weighted average rates were calculated using the market interest rate curve in effect as of December 31, 2025, on an annualized basis.
All debt with fixed maturity dates and denominated in foreign currency is hedged through derivatives (Note 5.6), except for the principal amount of the Perpetual Notes, which, by definition, have no contractual maturity date.
Non-current loans, borrowings and debentures exhibit the following maturity profile:
1 to 2 years
5,447,990
2,552,535
2 to 3 years
10,633,687
7,551,156
3 to 4 years
9,318,837
10,000,615
4 to 5 years
8,465,402
12,429,311
5 to 6 years
4,706,090
7,948,395
6 to 7 years
4,533,240
6,100,666
7 to 8 years
2,469,320
6,421,275
Above 8 years
14,733,845
9,048,325
b) Changes in loans, borrowings and debentures
Balance as of January 1, 2024
56,904,654
Proceeds
Repayment of principal
Payment of interest
Interest on work in progress
(128,520
Acquisition of subsidiaries
285,033
Interest, exchange rate and fair value
9,358,570
Balance as of December 31, 2024
(120,575
Acquisition of subsidiaries (Note 6.3)
(77,002
5,449,089
Balance as of December 31, 2025
c) Guarantees
Subsidiary Rumo maintains financing contracts with development institutions for infrastructure investments, secured by:
• Bank guarantees, carrying an average annual cost of 0.56%; or
• Real collateral provided through the fiduciary assignment of assets (fixed assets) amounting to R$ 1,390,404.
As of December 31, 2025, the outstanding balance of contracted bank guarantees totaled R$ 2,563,286 (R$ 2,655,231 as of December 31, 2024).
Moove maintains guarantees issued by first-tier financial institutions for obligations to third parties, with an average annual cost of 3.90%. As of December 31, 2025 none of the borrowings were secured by such guarantees (R$ 16,061 as of December 31, 2024).
The consolidated total of guaranteed loans amounted to R$ 6,930,423 (R$ 5,553,645 as of December 31, 2024). Cosan itself has no loans secured by real guarantees or bank guarantees.
d) Unused credit lines
As of December 31, 2025, the Company and its subsidiaries had unused credit lines with financial institutions totaling R$ 1,133,276 (R$ 1,510,231 as of December 31, 2024). Utilization of these facilities is conditional upon compliance with covenants and other contractual conditions stipulated by creditors.
e) Offset of financial assets and liabilities
The Company applies offsetting (set-off) in the statement of financial position only when both of the following criteria are met simultaneously:
• Existence of an unconditional legal right to offset recognized amounts; and
• Intention and practice to settle positions on a net basis or simultaneously.
In structured transactions involving TRS linked to debenture issuances, time deposits associated with Loan 4.131, and credit-linked notes ("CLNs") tied to Export Credit Notes ("ECNs"), offsetting is applied exclusively when contracts establish an automatic net settlement mechanism and positions are held with the same counterparty. In these specific situations, balances are presented net in the statement of financial position, with effects recognized directly in profit or loss.
Segment
Credit Linked Notes
5,627,660
6,334,168
Time deposit
3,718,105
TRS
3,359,856
5,640,466
8,987,516
15,692,739
NCEs
(5,627,660
(6,334,168
Loan 4.131(i)
(3,718,105
Debentures(ii)
(3,359,856
(5,640,466
(8,987,516
(15,692,739
Net Balance
At the lease commencement date, the Company assesses whether a contract is, or contains, a lease.
The lease liability is initially recognized at the present value of lease payments not yet paid at the commencement date, discounted using the interest rate implicit in the lease or, when that rate cannot be readily determined, the Company's incremental borrowing rate. In the absence of a determinable implicit rate, the Company systematically applies its incremental borrowing rate as the discount rate.
Lease payments included in the initial measurement of the liability comprise:
• Fixed payments, including payments that are in-substance fixed;
• Variable lease payments based on an index or rate, initially measured using the index or rate at the commencement date;
• Amounts expected to be payable by the lessee under residual value guarantees; and
• The exercise price of a purchase option when the lessee is reasonably certain to exercise it, and termination penalties when the lease term reflects the lessee's intention not to terminate.
To determine the incremental borrowing rate, the Company applies the following methodology:
• When available, recently obtained third-party financing is used as an initial reference, adjusted to reflect changes in market conditions since origination;
• For leases without comparable recent financing, a build-up approach is applied starting from a risk-free rate, adjusted for the Company's credit risk spread; and
• Specific adjustments are made based on lease characteristics: term, jurisdiction, functional currency, and existence of collateral.
The incremental borrowing rate (nominal) applied by the Company and its subsidiaries was determined based on market rates adjusted to functional currency and specific contractual terms for each transaction. Applied rates ranged from 4.25% to 13.73% per annum, depending on term and currency of each contract.
Two or more lease contracts are aggregated for measurement purposes only when all of the following conditions are met simultaneously:
• Executed with the same counterparty or a related party;
• Entered into at or near the same time; and
• Contain interdependent contractual obligations or usage rights that, in combination, constitute a single economic component of the lease.
Variable lease payments not based on an index or rate are recognized as expense in the period in which the triggering event occurs.
The Company is exposed to future increases in index-linked variable payments, which are not incorporated into the liability until they become effective. When index adjustments take effect, the lease liability is remeasured at the present value of revised payments using the original discount rate, with the corresponding adjustment recognized in the right-of-use asset.
Lease payments are allocated between reduction of the principal liability and finance costs. Finance costs are recognized within other financial income (expenses).
Short-term leases (maximum term of 12 months) and leases of low-value assets are recognized as expense on a straight-line basis over the lease term, without recognition of a right-of-use asset or lease liability. Low-value assets include information technology equipment and low-unit-value office furniture.
In determining the lease term, the Company assesses all facts and circumstances that create a significant economic incentive to exercise extension options or not exercise termination options. Extension options are included in the lease term only when the lessee is reasonably certain to exercise them.
For warehouse and equipment leases, the following factors are considered determinative in assessing extension probability:
• Existence of significant contractual penalties for early termination;
• Expectation of material residual value from leasehold improvements made to the leased property; and
• Operational substitution costs and historical renewal patterns for similar contracts.
Most extension options in office and vehicle leases were not incorporated into the lease term, as substitution of these assets can be effected without significant costs or material operational disruption.
Subsequent measurement of the lease liability is performed at amortized cost using the the implicit rate in the lease agreement or incremental rate on the lessee's loan. The liability is remeasured when:
• Future payments change due to index or rate revisions;
• Expectations change regarding payments under residual value guarantees;
• Assessment changes regarding exercise of contractual options (purchase, extension, or termination); or
• A contract modification substantially alters in-substance fixed payments.
5,275,794
Additions
999,553
Write-offs
(9,933
Accrual of interest and foreign exchange variation
1,120,882
Principal amortization
Interest payment
Contractual readjustment
174,662
20,404
6,509,753
479,435
(56,981
398,716
254,424
6,412,800
Lease contracts have varying terms, with final maturities extending to December 2058. Amounts are annually adjusted based on inflation indices (notably the General Market Price Index ("IGP-M") and the IPCA) or indexed to the Long-Term Interest Rate ("TJLP") or the CDI, as stipulated in each contract. Certain contracts include renewal or purchase options, which were evaluated under the "reasonably certain" criterion to determine the lease term and corresponding liability measurement.
In addition to amortization, interest accrual and foreign exchange variation presented in prior tables, the following impacts were recognized in profit or loss for lease contracts not included in the initial liability measurement:
December 31, 2023
Variable lease payments not included in the recognition of lease obligations
245,659
71,932
43,115
Expenses related to short-term leases
36,345
27,664
37,739
Low asset leasing costs, excluding short-term leases
10,169
10,005
5,376
292,173
109,601
86,230
Reported balances relate predominantly to the following contracts:
For the Malha Central and Malha Paulista contracts, an interest rate implicit in the lease was identified and used to calculate the present value of minimum future payments. The FSRU contract, being indexed to foreign currency, applies a discount rate based on the forward interest rate curve of the contractual currency (USD), with a cash flow hedge in place to mitigate foreign exchange exposure.
In accordance with CVM Circular Letter No. 2/2019, the Company does not incorporate future inflation projections in calculating the present value of lease payments. This approach applies fully to the contracts in question, as:
a) the implicit rates in the Malha Central and Malha Paulista contracts already reflect market expectations at the initial measurement date; and
b) the FSRU contract is denominated in foreign currency, with exchange rate variation separately addressed through a hedging instrument.
Given the specific characteristics of these contracts, Management assessed that any differences arising from the hypothetical inclusion of future inflation projections in remeasurement calculations would not be material enough to influence the economic decisions of financial statement users. Accordingly, quantitative disclosure of such analysis was omitted due to immateriality.
Lease liabilities are recognized at the present value of future contractual payments, without deduction of tax credits. Presumed PIS and COFINS tax credits arising from lease payments are recognized separately as current or non-current assets ("Tax recoverable") to the extent future utilization is probable.
As of December 31, 2025, the amount of presumed PIS and COFINS credits related to lease contracts was R$ 40,242 (R$ 30,814 as of December 31, 2024), fully recognized as assets with no impact on lease liability measurement.
Derivatives are initially recognized at fair value on the contract execution date and subsequently remeasured at fair value at each reporting date. Accounting treatment of fair value changes depends on whether the derivative qualifies for hedge accounting within a documented hedging relationship, per criteria established below:
Fair value changes of derivatives are usually recorded in the statement of profit or loss, classified as ‘Other financial income (expenses), except when derivatives qualify as hedge accounting, in which case they are recorded under the respective line of the hedged item.
Derivatives qualifying for hedge accounting are classified as Current Assets or Current Liabilities when the remaining term of the hedged item is 12 months or less from the reporting date; otherwise, they are classified as Non-Current Assets or Non-Current Liabilities.
The Company assesses hedge effectiveness both at inception and continuously throughout the hedging relationship's duration. Any inefficiency is recorded in the financial results.
Offsetting (set-off)
Derivative financial assets and liabilities are offset and presented at net amount in the statement of financial position only when all of the following criteria are met simultaneously:
Measurement
Fair value of derivatives is determined based on:
(i) prices from recent transactions in comparable markets;
(ii) adjustments for liquidity and counterparty risk (credit valuation adjustment – CVA);
(iii) projections of market rates implicit in the interest rate or foreign exchange curve (forward rates).
When the fair value at initial recognition differs from the transaction price, the difference is recognized in profit or loss as a fair value gain or loss only in cases where the derivative is classified within Level 1 of the fair value hierarchy or is based on a measurement method that uses only observable data. Otherwise, the difference should be deferred and recognized in profit or loss over time.
In the case of derivatives classified as financial liabilities, the Company also considers the debit valuation adjustment (DVA), which reflects the entity’s own credit risk in determining fair value.
The Company utilizes derivative instruments, notably swaps, whose fair value is determined based on discounted cash flows using observable market curves, to manage exposures to foreign exchange, interest rate, and inflation risks. Derivatives are classified according to their economic purpose and hedge accounting qualification.
Notional
Fair value
Exchange rate derivatives
Forward agreements (i)
(3,082
1,042,896
(3,498
28,392
FX option agreements
328,500
411,000
4,739
3,096
325,418
1,453,896
1,241
31,488
Commodity derivatives
Forward contract - NDF
8,610
21,174
(5,808
(7,158
Foreing exchange and interest rate risk
Swap agreements (interest rate) (ii)
6,453,930
14,965
(364,783
Swap agreements (interest and FX) (iii)
18,507,533
20,195,459
(560,354
1,912,553
Swap agreements (interest and inflation) (ii)
23,329,194
12,247,351
377,611
(246,660
42,186,727
38,896,740
(167,778
1,301,110
Share price risk
Swap agreements (TRS) (v)
709,561
1,817,821
(360,530
(1,073,657
Call Spread (iv)
5,594,212
4,667,709
119,314
77,341
6,303,773
6,485,530
(241,216
(996,316
Total of financial instruments
(413,561
329,124
(1,909,404
(2,504,117
(771,265
(966,087
The Company and its subsidiaries maintain forward foreign exchange contracts and/or currency options to hedge revenues, expenses, and future commitments denominated in foreign currency.
To manage interest rate risk, the Company entered into derivatives aimed at converting a portion of its fixed-rate debt denominated in reais to floating-rate indexation.
The breakout for debt-related and non-debt derivative financial instruments is presented below:
Debt Financial instruments
(135,554
1,319,512
Non-debt financial instruments
(278,007
(990,388
Derivative financial instruments related to borrowing transactions are used exclusively for economic hedging purposes and do not constitute speculative transactions
a) Fair value hedge
Through its subsidiaries, the Company applies fair value hedge accounting to certain borrowing transactions. A direct economic relationship exists between the hedged item (fixed-rate loan) and the hedging instrument (interest/currency swap), with alignment across the following dimensions:
• Equivalent notional amount;
• Coincident maturity; and
• Aligned payment schedule.
The Company establishes a hedge ratio close to 1:1, considering the identity of the underlying risk between the derivative and the hedged risk component of the protected item. Hedge effectiveness is assessed using the fair value change comparison method, contrasting changes in the fair value of the hedging instrument with changes in the fair value of the hedged item attributable to the hedged risk.
Principal potential sources of ineffectiveness identified are:
(i) Reduction or modification of the amount or term of the hedged item; and
(ii) Changes in the credit risk of the Company or swap counterparties.
Carrying amounts for items designated as hedging instruments were as follows:
Book value
Accumulated fair value from hedge adjustments
Subsidiary
Unit
FX rate risk hedge
Designated items
Senior Notes 2028
US$ + 5.30%
BRL
(2,791,600
(2,575,368
(2,631,834
(230,520
(519,686
Senior Notes 2032
US$ + 4.20%
(2,824,075
(2,570,510
(2,418,140
(193,000
(687,411
NCE U.S.$
(25,341
(131,663
(5,145,878
(5,075,315
(423,520
(1,338,760
Interest rate risk hedge
BNDES Project VIII
IPCA + 3.25%
(708,331
(600,312
(678,785
89,242
100,511
(300,000
(280,866
6,401
(700,000
(717,294
15,042
IPCA + 5.62%
(13,657,901
(14,220,199
(9,719,039
(1,544,982
(1,851,762
(467,321
(494,225
(299,706
(11,288
(13,635
Finem
TLP + 2.06%
(19,096
(21,469
(25,764
(1,810
(2,212
CCB
(898,651
(814,423
(874,513
(78,121
(63,520
(17,148,788
(11,597,807
(1,525,516
(1,830,618
Currency and interest rate swap
Swap Senior Notes 2028
115% CDI
2,791,600
2,591,695
2,852,107
2,657,287
2,707,334
Swap Senior Notes 2032
106% CDI
2,824,075
2,612,445
2,801,555
4,039,312
3,926,328
25,341
124,097
5,204,140
5,653,662
6,721,940
6,757,759
99.80% CDI
708,331
621,400
712,630
693,704
795,268
Debenture 14th issue - 1st Series
90.30% CDI
312,530
308,633
Debenture 14th issue - 2nd Series
88.27% CDI
729,019
719,685
Swap Debenture
104% CDI
13,657,901
14,412,764
14,027,253
10,016,793
10,377,790
96% CDI
467,321
499,641
519,387
304,962
318,827
19,096
21,044
19,207
23,552
22,614
64% CDI
898,651
822,384
903,152
882,930
946,589
17,418,782
17,209,947
11,921,941
12,461,088
b) Fair value option
Certain financial instruments were not designated in formally documented hedge accounting relationships. To eliminate accounting mismatch, the Company elected to irrevocably designate, at initial recognition, certain financial liabilities for measurement at fair value through profit or loss.
This designation applies to the financial liability itself (the hedging instrument), not to the hedged item. Fair value changes attributable to market factors (interest rates, foreign exchange) are recognized in profit or loss for the period. The portion of the change attributable to the Company's own credit risk is recognized directly in shareholders' equity as part of other comprehensive income.
Carrying amount
Accumulated fair value
FX rate risk
Items
PPE (Moove)
(100,000
(549,611
(620,690
1,862
(13,554
NCE (Moove)
(50,000
(282,516
(320,606
976
(4,164
(274,252
1,283
Senior Notes 2027 (Cosan Luxembourg)
USD + 7.00%
(2,475,674
(1,540,318
Export Credit Agreement (Rumo)
EUR + 0.58%
(12,685
(4,526
(38,525
(8
(713
Scotiabank 2022 (Compass)
USD + 2.51%
(1,245,669
3,580
Scotiabank 2023 (Compass)
USD + 4.76%
(749,310
(828,619
(926,262
(625
5,920
BNP Paribas 2024 (Compass)
EUR + 5.74%
(523,634
(19,408
(1,939,524
(6,151,060
3,488
(1,568,657
Interest rate risk and inflation
BNDES Projects VI e VII (Compass)
IPCA + 4.10%
(78,110
(67,724
(88,477
2,844
3,288
BNDES Project VIII (Compass)
(616,366
(575,321
(639,325
41,068
39,439
BNDES Project IX (Compass)
IPCA + 5.74%
(540,992
(564,266
(554,820
46,209
54,110
BNDES Project IX - Sub A (Compass)
(292,893
(291,576
(287,962
19,222
22,242
(188,050
(186,576
(184,883
9,574
10,864
BNDES Project IX - Sub B (Compass)
IPCA + 6.01%
(301,483
(299,933
(295,695
20,339
23,999
Debenture 4th issue - 3rd Series (Compass)
IPCA + 7.36%
(41,436
718
Debenture 9th issue - 1st Series (Compass)
IPCA + 5.12%
(500,000
(575,279
(512,946
75,823
88,728
Debenture 9th issue - 2nd Series (Compass)
IPCA + 5.22%
(530,740
(466,173
120,271
133,379
Debenture 11th issue - 1st Series (Compass)
IPCA + 6.38%
(750,000
(757,552
(685,420
58,101
72,780
Debenture 11th issue - 2nd Series (Compass)
IPCA + 6.45%
(739,987
(662,782
68,957
85,912
Debenture 12th issue – Single series (Compass)
IPCA + 7.17%
(600,000
(619,902
(588,142
(18,877
(10,096
Debenture 2nd issue – Single series (Compass)
IPCA + 7.44%
(800,000
(881,057
3,057
Debentures (Rumo)
IPCA + 4.68%
(60,000
(169,600
(248,085
(473
(59,916
IPCA + 4.50%
(788,138
(755,061
(63,542
(96,457
(7,047,651
(6,011,207
382,573
368,990
Derivatives instruments
CDI + 0.79%
100,000
10,069
66,125
CDI + 0.60%
50,000
(9,119
42,006
(2,295
Swap Senior Notes 2027 (Cosan Luxembourg)
BRL + 114.66% CDI
217,523
FX and interest rate swap (Rumo)
BRL + 108% CDI
12,685
6,000
12,253
95,971
CDI + 1.30%
749,310
69,736
169,185
55,805
74,391
658,868
BNDES Projects VI and VII (Compass)
87.50% CDI
78,110
(3,048
(3,332
82.94% CDI
616,366
(42,744
(39,834
98.90% CDI
540,992
33,502
1,394
95.55% CDI
292,893
1,745
(14,383
92.35% CDI
188,050
783
(8,929
98.49% CDI
301,483
1,149
(15,994
112.49% CDI
3,203
109.20% CDI
37,108
5,192
110.60% CDI
(7,512
(39,535
100.45% CDI
(37,594
(71,755
99.70% CDI
(48,653
(84,963
95.66% CDI
600,000
44,360
10,424
97.40% CDI
(14,363
107% CDI
60,000
24,126
60,419
103% CDI
179,919
130,505
168,778
(67,588
c) Cash flow hedge
Indirect subsidiary Edge Comercialização S.A. ("Edge") executed natural gas sales transactions with prices indexed to Brent. To mitigate exposure to volatility in this index, Edge formally designated such contracts as cash flow hedge relationships.
Indirect subsidiary Terminal de Regaseificação de GNL de São Paulo ("TRSP") adopted hedge accounting to protect against cash flow variability arising from foreign exchange risk. The strategy consists of using a U.S. dollar-denominated lease liability, already contracted, as a hedge for highly probable future revenues also denominated in U.S. dollars, projected over a 20-year horizon, due 2043.
Effective hedge gains and losses are initially recognized in other comprehensive income and reclassified to profit or loss when the hedged cash flows actually occur.
To mitigate the effects of foreign exchange volatility on highly probable future cash flows, subsidiary Rumo contracted derivative financial instruments in the form of currency swaps and designated them as cash flow hedges. The hedging relationship was documented at inception, with prospective effectiveness testing and subsequent retrospective assessment. Hedge effects are recognized in equity within "Other Comprehensive Income" and reclassified to profit or loss when the hedged cash flows actually occur.
The impact of items protected by hedge accounting on the statement of financial position is presented below:
Risk
Nocional
Financial instrument
Future
Edge
Price
2,596
(4,654
Leasing
TRSP
Exchange
3,409,281
(208,509
(446,224
Swap exchange rate and interest
1,044,127
(109,510
(322,673
(-) Deferred tax
109,709
151,716
The effect of cash flow hedging on the income statement and other comprehensive income is shown below:
Ineffectiveness
Balance as of January 1, 2025
Designation
Financial results
(17,742
9,027
4,061
224,319
11,666
1,730
(169,196
59,686
37,381
68,713
5,791
Sources of hedge accounting ineffectiveness, although historically immaterial, may arise from the following factors:
The Company continuously monitors sources of ineffectiveness, employing quantitative and qualitative analyses to assess impacts on fair value and hedge effectiveness. These practices align with accounting and treasury policies.
Trade receivables are recognized when Cosan has an unconditional right to consideration arising from the transfer of goods or services to a customer (an unconditional right to consideration). They are initially measured at the fair value of the consideration to be received, generally equivalent to the transaction price, adjusted for:
•Trade discounts granted;
•Expected returns (customer return rights);
•Significant financing components (present value adjustment when the payment term exceeds 12 months and contains a significant financing component).
After initial recognition, trade receivables are measured at amortized cost using the effective interest rate method.
Expected Credit Losses (ECL)
The Company recognizes an allowance for expected credit losses using a staged expected loss approach:
• Stage 1: Receivables whose credit risk has not increased significantly since initial recognition—allowance calculated based on 12-month expected credit losses;
• Stages 2 and 3: Receivables whose credit risk has increased significantly or are in default—allowance calculated based on lifetime expected credit losses over the remaining life of the asset.
Receivables are grouped into homogeneous pools based on similar credit risk characteristics (customer segment, payment term, delinquency history, and economic sector). Loss rates are determined based on:
• Observed historical credit loss experience in prior periods;
• Adjustments to reflect current conditions (e.g., deterioration in the customer's sector); and
• Reasonable and supportable forecasts of future economic conditions (e.g., GDP, unemployment rate, regulatory environment).
The allowance for expected credit losses is recognized as a selling expense.
Domestic market
3,099,186
3,220,315
Unbilled receivables (i)
760,602
853,993
Foreign market - foreign currency
79,358
134,127
3,939,146
4,208,435
Expected credit losses
(269,983
(212,701
The aging of accounts receivable is as follows:
Not due
3,393,659
3,615,094
Overdue
Until 30 days
224,168
280,392
From 31 to 60 days
44,869
74,817
From 61 to 90 days
28,226
27,198
More than 90 days
248,224
210,934
The changes in expected credit losses are as follows:
(161,108
(17,606
Additions/reversals
(54,882
20,895
(715
(94,974
Foreign exchange variation
1,253
37,154
Transactions with related parties were conducted under pre-agreed contractual terms. Outstanding balances at period end are unsecured, non-interest-bearing, and settled in cash. No guarantees were given or received on any receivables or payables involving related parties. At the end of each period, recoverability of amounts and receivables is assessed; for the years ended December 31, 2025 and 2024, no allowance was recognized.
The Company maintains a Cost Sharing Agreement governing the sharing of activities and expenses, together with reimbursement guidelines and other commercial terms for group expense allocation. These expenses are classified as intercompany transactions.
Balances and transactions between the Company and its subsidiaries, which are related parties, were eliminated on consolidation and are not disclosed in this note.
a) Trade receivable and payable with related parties:
Commercial operations
Raízen S.A. and its subsidiaries
70,001
72,518
CLI Sul S.A.
14,431
19,458
Termag - Terminal Marítimo de Guarujá S.A.
14,286
Associação Gestora da Ferrovia Internado Porto de Santos (AG-FIPS)
49,397
36,985
1,299
565
501
6,373
149,915
150,185
Financial operations
Raízen S.A. and its subsidiaries (i)
49,634
45,173
1,705
46,878
Total current assets
8,333
21,438
26,920
Ligga S.A.
154,468
12,000
12,015
181,388
Total non-current assets
Related parties receivables
164,788
303,656
Termag - Guarujá Maritime Terminal S.A.
95
8,149
Association for the Management of the Internal Railway of the Port of Santos (AG-FIPS)
43,607
45,119
315
1,932
208,805
358,856
Financial and corporate operations
111,548
57,554
563
112,111
Total current liabilities
88
Total non-current liabilities
Payables to related party
322,082
417,488
The current and non-current assets receivable by Raízen S.A. and its subsidiaries are substantially tax credits that will be reimbursed to the Company when realized.
Current liabilities represent reimbursements to Raízen S.A. and its subsidiaries for expenses related to legal disputes and other liabilities incurred before the formation of the joint venture, and which are the responsibility of Cosan S.A.
b) Transactions with related parties:
Years ended on December 31,
Operating income
583,567
1,294,971
974,612
12,629
12,375
15,434
1,183
46,350
56,000
597,379
1,353,696
1,046,046
Purchase of products / inputs / services
(2,475,506
(3,129,874
(2,251,896
(49,835
(74,785
(4,544
(68,536
(2,525,341
(3,134,418
(2,395,217
Shared income (expenses)
(97,702
(30,156
(83,054
(134,820
118
(22
(755
(232,404
(30,178
(83,809
(22,197
10,410
4,808
(11,787
(2,172,153
(1,806,092
(1,432,980
c) Managers’ and directors’ compensation:
The Company has a compensation policy approved by the Board of Directors. Compensation for key management personnel includes salaries, contributions to a post-employment defined benefit plan, and stock-based compensation. On April 30, 2025, the Annual General Meeting approved the total annual compensation for directors for the fiscal year 2025.
Below we present the results for the consolidated results:
Short-term employee and key management benefits
196,334
175,487
207,026
Share based compensation
37,492
67,569
97,510
2,642
2,369
60,781
Employment termination benefits
1,645
2,888
Other long-term benefits
9,545
5,981
246,013
253,051
368,205
Due to the short-term nature of trade payables, their carrying amounts are the same as their fair values, and they are generally paid within 30 to 90 days of recognition.
The supplier balances are presented below:
Material and services suppliers
3,284,618
4,205,516
Natural gas / transport and logistics suppliers
812,884
982,333
4,097,502
5,187,849
Sector-specific financial assets and liabilities neutralize the economic impacts on distributors' results. These impacts arise from differences between the gas costs and tax rates included in regulatory rulings by regulatory agencies and those actually incorporated into tariffs during each tariff adjustment or review cycle.
Regulatory agencies overseeing indirect subsidiaries:
Based on these rulings, our indirect subsidiary Compass has concluded that there is no uncertainty in recognizing sector-specific financial assets and liabilities as amounts receivable or payable.
Accordingly, Compass recognizes these assets and liabilities in its financial statements. They are based on the difference between the actual cost and the cost considered in tariff adjustments. This generates a receivable when the actual cost exceeds the amount incorporated in the tariff, or a liability when the costs are lower than those incorporated in the tariff. These differences are considered in the subsequent tariff adjustment and become components of the distributors' tariff adjustment index
The movement of net Sectorial financial assets (liabilities) was as follows:
Sectorial Assets
Sectorial Liabilities (iv)
548,700
(1,810,698
(1,261,998
Cost of gas (i)|(ii)
(12,437
(2,210
(14,647
Tax credits
(65,710
Monetary adjustment (iii)
71,981
(161,621
(89,640
IGP-M deferral
117,418
5,980
(1,308,597
Cost of gas (i)
(51,483
(38,931
(90,414
(29,025
Residential deferral (iv)
52,092
Monetary adjustment (ii)
45,821
(157,066
(111,245
IGP-M deferral (v)
(49,118
(1,536,307
(96,719
241,613
(2,168,542
(1,777,920
On February 23, 2026, ARSESP published Resolution No. 1,776. This resolution establishes the criteria for allocating to users the amounts that piped gas concessionaires earned from excluding the state sales tax (Imposto sobre Circulação de Mercadorias e Serviços, or “ICMS”) from the tax base for the employees’ profit participation program (Programa de Integração Social, or “PIS”) and the social contribution for social security financing (Contribuição para o Financiamento da Seguridade Social, or “COFINS”). The purpose is to restore the economic-financial equilibrium of the concessions.
This resolution has no impact on the financial statements as of December 31, 2025, because the Company understands that any cash outflows will occur after twelve months.
Fair value is the price that would be obtained for the sale of an asset or paid for the transfer of a liability in an unforced transaction between market participants on the measurement date. The fair value measurement assumes that the transaction to sell the asset or transfer the liability will occur:
• In the principal market for the asset or liability;
• or In the absence of a principal market, in the most advantageous market for the asset or liability. The Company must have access to the main or most advantageous market.
The measurement of the fair value of an asset or liability is based on the assumptions that market participants would use to set the price, assuming that they are acting in their best economic interests.
For non-financial assets, fair value measurement considers the market participant's ability to generate economic benefits by using the asset in its best possible use or by selling it to another participant who would use it for the same purpose.
The best evidence of the fair value of a financial instrument on initial recognition is generally the transaction price, i.e. the fair value of the consideration given or received. When the fair value at initial recognition differs from the transaction price, the difference is recognized in profit or loss as a fair value gain or loss only in cases where the derivative is classified within Level 1 of the fair value hierarchy or based on a measurement method that uses only observable inputs. For derivatives classified within Levels 2 or 3, the difference must be deferred and recognized in profit or loss over time.
All assets and liabilities measured or disclosed at fair value in the financial statements are classified within the fair value hierarchy, as described below:
• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities to which the entity has access at the measurement date;
• Level 2: valuation techniques for which the inputs are not the quoted prices included in Level 1, but which are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices);
• Level 3: valuation techniques that include information about the asset or liability that is not based on observable market data (unobservable information).
When measuring the fair value of an asset or liability, the Company uses observable market data as much as possible. The specific valuation techniques used to value financial instruments include:
i. Use of quoted market prices;
ii. Fair value calculated as the present value of estimated future cash flows. Estimates of future floating rate cash flows are based on quoted swap rates, futures prices and interbank lending rates. The estimated cash flows are discounted using a yield curve constructed from similar sources and reflecting the relevant reference interbank rate used by market participants for this purpose when pricing interest rate swaps. The estimate of fair value is subject to a credit risk adjustment that reflects the credit risk of the Company and its counterparty; this is calculated based on the credit spreads derived from the current credit default swap; and
iii. For other financial instruments, discounted cash flow analysis.
External valuers may be involved in the valuation of significant assets and liabilities, such as investment properties, unlisted financial assets and contingent consideration.
For fair value disclosure purposes, the Company defines classes of assets and liabilities based on their nature, characteristics and risks involved, as well as the level of the fair value hierarchy, as explained above.
The carrying amounts of short-term financial assets and liabilities do not differ significantly from their fair value. The carrying amounts and fair value of consolidated assets and liabilities are as follows:
Assets and liabilities measured at fair value
Level 1
Level 2
Level 3
Investments funds
2,685,416
Investment properties (i)
26,012,955
26,131,485
312,982
7,478,192
9,308,071
Loans, borrowings and debentures (ii)
(64,136,362
Other accounts payable (iii)
(66,919,654
(69,937,992
(66,817,031
(31,764,238
For debts whose market value is quoted on the Luxembourg Stock Exchange (or “LuxSE”), the fair value measurement is based on the quoted market price as follows:
Debts
Rumo Luxembourg S.à rl
99.98%
97.32%
92.04%
84.30%
Senior Notes due 2027 (i)
99.63%
This note describes the group's exposure to financial risks and how these risks may affect future financial performance. To provide more context, current year profit or loss information has been included where applicable:
Exposure
Management
Market Risk – exchange rate
i. Future commercial transactions. ii. Recognized financial assets and liabilities not denominated in Reais.
i. Cash flow forecasting
ii. Sensitivity analysis.
Foreign currency.
Market Risk – interest rates
Cash and cash equivalents, marketable securities, loans, borrowings and debentures, leases and derivatives financial instruments.
Sensitivity analysis.
Interest rate swap.
Market Risk – price
i. Future business transactions.
ii. Investments in securities.
i. Projected cash flow.
i. Commodity futures price.
ii. Hedging derivative for both appreciation and depreciation of shares.
Credit risk
Cash and cash equivalents, marketable securities, accounts receivable, derivatives, accounts receivable from related parties, dividends and investment properties.
i. Analysis by maturity.
ii. Credit ratings.
Available funds and lines of credit.
Liquidity risk
Loans, borrowings and debentures, accounts payable to suppliers, other financial liabilities, REFIS (Special Tax Regularization Program), leases, derivatives, accounts payable to related parties and dividends.
Cash flow forecasting
The Company's Management identifies, assesses, and protects against financial risks in close cooperation with the operating units. The Board of Directors provides written principles for overall risk management, as well as policies covering specific areas such as foreign exchange risk, interest rate risk, credit risk, use of derivatives and non- derivatives financial instruments, and investment of excess liquidity.
When all relevant criteria are met, hedge accounting is applied to eliminate the accounting mismatch between the hedging instrument and the hedged item. This results in the recognition of interest expense at a fixed interest rate for hedged loans and floating-rate inventories, and at a fixed exchange rate for hedged purchases.
The Company may choose to formally designate new debt transactions for which it holds hedging derivatives financial instruments of the swap type for the exchange of foreign exchange variation , measured at fair value. The fair value option aims to eliminate inconsistencies in the result arising from differences between the measurement criteria of certain liabilities and their hedging instruments. Thus, both the swaps and the respective debts will be measured at fair value. This option is irrevocable and must be exercised only in the initial accounting entry of the transaction.
The Company's policy is to maintain a capital basis to promote the confidence of investors, creditors, and the market, and to ensure the future development of the business. Management monitors the return on capital for each of its businesses. The use of financial instruments to hedge against these areas of volatility is determined through an analysis of the risk exposure that Management intends to cover.
a) Market Risk
The objective of market risk management is to manage and control market risk exposures within acceptable parameters, optimizing returns.
The Company uses derivatives to manage market risks. All such transactions are carried out in accordance with the guidelines established by the Risk Management Committee.
Foreign exchange risk
The Company presents the following net exposure to foreign exchange variation for assets and liabilities denominated in US dollars, euros and British pounds, for companies with real functional currency.
649,107
1,861,070
71,555
35,807
(417,312
(691,312
(15,949,122
(24,263,167
Lease
(2,043,650
(2,121,304
Derivative financial instruments (notional)
14,851,873
22,576,441
(2,935,601
(2,848,721
The likely scenario considers the estimated exchange rates at the maturity of the transactions, as presented below:
Scenarios
Instrument
Risk factor
Probable
25%
50%
(25%)
(50%)
Low FX rate
850
159,574
318,297
(157,873
(316,597
(42
24,113
48,268
(24,197
(48,352
(23
17,754
35,457
(18,066
(35,813
High FX rate
124
(103,403
(206,380
103,433
206,733
6,720
(3,982,846
(7,969,185
3,986,877
7,973,216
894
(509,795
(1,020,484
511,583
1,022,272
85
(48,658
(97,401
48,828
97,571
119,237
3,776,424
7,625,727
(4,245,617
(7,943,997
Impacts on profit or loss before taxes
127,499
(470,764
(873,209
8,203
561,849
Impacts on other comprehensive income
346
(196,073
(392,492
196,765
393,184
Exchange rate sensitivity analysis
U.S.$
5.5024
5.5000
6.8750
8.2500
4.1250
2.7500
Euro
6.4692
6.5450
8.1813
9.8175
4.9088
3.2725
GBP
7.4112
7.5350
9.4188
11.3025
5.6513
3.7675
Interest rate risk
The Company and its subsidiaries monitor fluctuations in variable interest rates related to their loans and use derivatives instruments to minimize the risks of variable interest rate fluctuations.
The following is a sensitivity analysis of interest rates on loans and borrowings, leasing, and other liabilities, with a counterpart to investments in CDI), with increases and reductions of 25% and 50%, before taxes:
Interest rate exposure
3,576,657
4,470,822
5,364,985
2,682,494
1,788,328
352,503
440,663
528,754
264,412
176,251
30,755
38,444
46,133
23,066
15,378
Lease and concession in installments
(109,119
(136,439
(163,678
(81,879
(54,559
Leases liabilities
(507,078
(523,354
(539,617
(490,814
(474,517
(2,911,889
(3,451,774
(4,243,945
(1,489,407
(481,098
(4,138,321
(4,991,523
(5,964,416
(3,095,361
(2,132,787
(136,118
(170,147
(204,177
(102,088
(68,059
(632,368
(787,705
(938,046
(487,023
(336,682
(447,736
(555,305
(660,524
(344,867
(239,649
(4,922,714
(5,666,318
(6,774,531
(3,121,467
(1,807,394
Part of the value presented in derivatives financial instruments corresponds to the Total Return Swap (TRS):
(48,816
(61,038
(73,224
(36,630
(24,408
The likely scenario considers the estimated interest rate, calculated by a specialized third party and the Central Bank of Brazil ("BACEN"), as presented below:
SELIC
13.54%
16.93%
20.31%
10.16%
6.77%
CDI
13.44%
16.80%
20.16%
10.08%
6.72%
TJLP462 (TJLP + 1% p.a.)
9.90%
12.13%
14.35%
7.68%
5.45%
TJLP
8.90%
11.13%
13.35%
6.68%
4.45%
5.15%
6.18%
3.09%
2.06%
IGPM
3.81%
4.76%
5.71%
2.86%
1.90%
Fed Funds
3.00%
3.75%
4.50%
2.25%
1.50%
SOFR
2.74%
3.43%
1.37%
CPI
2.60%
3.25%
3.90%
1.95%
1.30%
Price risk
Commodity derivative
Price Change in US$ / bbl
1,042
2,084
(1,042
(2,084
The Company uses derivative financial instruments, called options, to limit its exposure to variations in the value of Vale's shares. The methodology employed, and widely accepted, to calculate the fair value of the options is based on the Black & Scholes pricing model. The values calculated in the sensitivity analysis of the aforementioned structure reflect the impacts of the intrinsic values of the options, according to the appreciation or depreciation of the shares. The Company settled the call spread on January 8 and 9, 2026.
VALE3 (Call Spread)
1.34%
263,316
453,659
(12,028
(36,900
Call Option (“Call”)
The Company holds a purchase option that grants it the right to repurchase all of Cosan Nove's preferred shares, which may be exercised starting in the third year after the signing of the respective agreements, in December 2022.
As of December 31, 2025, the call option was underpriced.
Contingent put option
Under the shareholders' agreement entered into in December 2022 between the Company and Itaú, regarding the issuance of preferred shares by Cosan Nove, the parties agreed that financial institutions hold a contingent put option, exercisable only when specific material adverse effects foreseen in the contract occur. These effects are under the Company's control and, therefore, do not constitute a financial obligation.
The option exercise price is calculated based on the initial investment value, adjusted by a rate of CDI + spread, less dividends received by the non-controlling shareholder during that period. As of December 31, 2025, the exercise price of this option is R$ 2,488,636.
The treasury share repurchase plan exposes the Company to risks resulting from changes in the market price of Cosan’s shares (ticker CSAN3). To mitigate these exposures, the Company has entered into TRS (Total Return Swap) transactions relating to 80,085,312 CSAN3 shares. On the active side, the Company receives the variation in the share price and the distributed dividends, and on the passive side, it pays CDI (Interbank Deposit Certificate) + spread.
Sensitivity analysis considers the closing price of the shares, as shown below:
TRS CSAN3
(377,969
106,527
212,253
(105,726
(212,253
Value of the share (CSAN3)
5.32
7.98
3.99
2.66
b) Credit risk
The Company's regular operations expose it to potential defaults when customers, suppliers, and counterparties fail to meet their financial or other obligations. The credit risk exposure was as follows:
2,685,417
2,620,840
2,761,254
Receivable dividends and interest on equity
38,976,091
31,578,394
The Company is exposed to risks related to its cash management activities and temporary investments.
Liquid assets are primarily invested in government bonds and other bank investments. Credit risk for balances with banks and financial institutions is managed by the treasury department, in accordance with Company policy.
The Company and its subsidiaries adopt structured credit risk assessment policies for the execution of lease agreements and for installment sales of investment properties.
In lease transactions, the analysis includes an evaluation of the economic and financial capacity of potential lessees, based on liquidity, leverage, and cash flow indicators, as well as registry checks and market references. The portfolio is composed primarily of large companies with recognized solidity in the agribusiness sector, under medium- and long-term contracts (ranging from 3 to 30 years), which has historically resulted in a low incidence of losses.
In installment sales, risk is mitigated through credit assessments conducted by a specialized firm, complemented by internal analysis. Possession is granted only after receipt of the initial payment, and transfer of ownership is affected exclusively upon full settlement of the purchase price, substantially reducing exposure to default.
Investments of surplus funds are made only with approved counterparties and within the credit limits assigned to each. Counterparty credit limits are reviewed annually and may be updated throughout the year. The limits are set to minimize risk concentration and, consequently, mitigate financial loss resulting from counterparty failure to make payments.
The credit risk of cash and cash equivalents, marketable securities, restricted cash, and derivatives financial instruments is determined by widely accepted market rating agencies, as presented below:
AAA
23,289,686
22,706,407
AA
9,037,928
803,935
A
571,942
Not rated
97,362
181,190
32,424,976
24,263,474
c) Liquidity risk
The Company's approach to managing liquidity consists of ensuring, whenever possible, sufficient liquidity to meet its liabilities as they become due, under normal and stress conditions, without incurring unacceptable losses or compromising the Company's reputation.
The Company's financial liabilities, classified by maturity dates (basis on contracted undiscounted cash flows), are as follows:
Up to 1 year
From 1 to 2 years
From 2 to 5 years
Over 5 years
(7,374,410
(9,748,954
(43,246,192
(58,220,334
(118,589,890
(64,570,345
(4,078,511
(18,991
(10,670,813
(770,103
(14,977
(10,428
(1,995
(228,318
(255,718
(454,885
(1,099,642
(1,078,819
(1,292,243
(20,529,560
(24,000,264
(20,948,336
(233,582
(229,938
(454,126
(188,480
(1,106,126
(1,281,108
Payables to related parties
(320,916
(1,166
(416,410
(9,629
(31,089
(104,964
(155,311
(185,622
(3,019,375
(1,221,626
(979,747
13,021,596
7,800,848
6,528,439
Sectorial financial liabilities (i)
(64,718
(4,000,000
(3,225,338
(17,571,129
(15,544,889
(46,005,392
(70,250,060
(149,371,470
(92,930,623
Due to the uncertainty regarding the exact timing of settlement of these obligations, the liability has not been included in the maturity schedule. The Company recognizes this liability in accordance with the applicable accounting standards and awaits regulatory definition in order to determine the settlement timetable.
d) Capital management risk
The Company manages its capital structure, adjusting it in accordance with changes in economic conditions and the requirements of financial covenants. To maintain or adjust this structure, the Company may modify dividend payments to shareholders, reduce share capital, or issue new shares. The Company monitors capital primarily through debt service coverage ratios, as well as leverage, calculated as the ratio of net debt to EBITDA.
The Company's policy is to maintain a solid capital basis to foster the confidence of its parent companies, creditors, and the market, and to ensure the future development of the business.
To achieve this overall objective, the Group's capital management seeks, among other aspects, to ensure compliance with the financial commitments associated with loans and borrowings that define the capital structure requirements.
The Company recognizes as a financial liability any contractual, legal, or statutory obligations to repurchase equity interests in subsidiaries when it does not hold an unconditional right to avoid the outflow of economic resources for settlement. Such obligations typically arise from put option clauses, which grant minority shareholders the right to require the repurchase of their shares.
When the repurchase obligation is due on a specific or determinable date and its value can be measured based on objective criteria, the Company classifies it entirely as a liability — current or non-current depending on the maturity date.
For presentation purposes, repurchase obligations are classified as current liabilities when maturity occurs within twelve months of the balance sheet date, and as non-current liabilities in all other cases. Under no circumstances is offsetting (set-off) between the repurchase obligation and the investment held in the subsidiary permitted.
Financial liabilities are measured at amortized cost. This calculation considers the outstanding balance of the initial contribution, updated using financial ratios, less dividends paid, also updated.
Addition
Cost of raising capital
(157,684
Interest rate update
2,332
Balance as of December 31, 2025 (Note 2.1.10)
Tax assets are measured at cost and primarily consist of (i) tax effects that are recognized when the asset is sold to a third party or recovered through amortization over the remaining economic life of the asset; and (ii) tax receivables that are expected to be recovered as refunds from tax authorities or as a reduction for future tax liabilities.
COFINS - Social security financing contribution
613,487
551,156
PIS - Social integration program
143,765
114,956
35,278
35,177
ICMS - State VAT
1,496,925
1,105,839
ICMS - State VAT CIAP
377,743
289,615
171,513
123,946
2,838,711
2,220,689
Inventories are measured at the lower of cost and net realizable value, understood as the estimated selling price in the ordinary course of business, less estimated costs of completion and costs necessary to make the sale.
The cost of finished and work-in-progress goods comprises direct materials, direct labor, and an appropriate proportion of variable and fixed indirect manufacturing costs. Fixed indirect costs are allocated based on the normal operating capacity of the manufacturing facility.
Costs are allocated to inventory items using the average cost method.
When the net realizable value of certain inventory items is lower than their cost, the inventory is directly written down to its net realizable value, with the immediate recognition of the loss in the income statement for the period. This adjustment encompasses risks associated with obsolescence, physical deterioration, or other factors that may impair the economic realization of the inventory. Write-down losses to net realizable value may be reversed in subsequent fiscal years should the conditions that originally caused them cease to exist.
Finished products
1,511,903
1,664,235
Parts and accessories
191,238
207,794
Construction Materials
202,175
193,450
Warehouse and others
63,942
7,426
The balances are presented net of the provision for obsolete inventory in the amount of R$ 35,552 as of December 31, 2025 (R$ 38,449 and R$ 78,709 as of December 31, 2024 and 2023 respectively).
The Company classifies non-current assets (mainly agricultural investment properties, from the Radar segment) and disposal groups as held for sale if their carrying amounts are recovered mainly through a sale transaction and not through continuous use. Non-current assets and disposal groups classified as held for sale (except investment properties measured at fair value) are measured at the lower of carrying value and fair value less costs to sell. Selling costs are the incremental costs directly attributable to the disposal of an asset (disposal group), excluding finance expenses and income tax expenses.
The criteria for classifying held for sale are considered met only when the sale is highly probable and the asset or group for disposal is available for immediate sale in its current condition. The actions required to complete the sale must indicate that it is unlikely that significant changes to the sale will be made or that the decision to sell will be withdrawn. Management must be committed to the asset sale plan and the sale is expected to be completed within one year of the classification date.
Assets and liabilities classified as held for sale are presented separately in the financial position.
a) Composition and movement of assets held for sale:
• Changes of assets held for sale
Properties held for sale
Other assets held for sale
342,392
1,795,773
2,138,165
280
60,792
61,072
Transfers
437,080
745
437,825
Sale of agricultural properties intended for sale
(746,774
Investment sale
(911,500
32,978
945,810
Transfers (ii)
50,403
(28,927
21,476
Impairment (i)
1,165
651,003
(i) Due to a reduction in the estimated fair value in the amount of R$ 265,880 attributable to TUP Porto São Luís SA, recorded in the profit or loss for the year.
(ii) Transfers totaling R$ 50,403 were made from the investment property.
a) Breakdown of assets held for sale
TUP Porto São Luis S.A
48,231
3,030
395,757
437,965
31,865
469,830
Other assets
35
619,138
b) Breakdown of liabilities held for sale:
Trade payable
17,248
1,828
Other liabilities
456
66,606
(i) Subsidiaries
The Company controls an entity when it is exposed to, or has a right over, variable returns arising from its involvement with the entity and has the ability to affect those returns through the exercise of its power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date on which the Company obtains control until the date on which control is discontinued.
The Company assesses whether it retains control over an investee if facts and circumstances indicate that there have been changes in one or more of the three elements of control mentioned above.
When the Company does not hold a majority of the voting rights in an investee, it retains control over the investee when the voting rights are sufficient to enable it, in practice, to unilaterally direct the relevant activities of the investee. In assessing whether the Company's voting rights in an investee are sufficient to give it control, the Company considers all relevant facts and circumstances, including:
When necessary, the financial statements of subsidiaries are adjusted to bring their accounting policies into line with the Company's accounting policies.
All intra-group transactions, balances, income, expenses and cash flows are eliminated in the consolidated financial statements.
Changes in interests in subsidiaries that do not result in a loss of control are accounted for as equity transactions. The carrying amounts of the Company’s interests and the non-controlling interests are adjusted to reflect the changes in their respective ownership interests in the subsidiaries. The difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to the Company’s owners.
When the Company loses control of a subsidiary, the gain or loss on disposal recognized in profit or loss is calculated as the difference between: (i) the sum of the fair value of the consideration received and the fair value of any interest retained in the former subsidiary and (ii) the previous book value of the assets (including goodwill) and liabilities of the subsidiary and the non-controlling interest. Any amounts previously recognized in “Other comprehensive income” related to the subsidiary are treated as if the Company had directly disposed of the related assets and liabilities of the subsidiary (i.e. they are reclassified to profit or loss or transferred to another equity account). The fair value of any investment held in the former subsidiary on the date control is lost is considered as the fair value on initial recognition for subsequent accounting purposes, when applicable, or as the cost on initial recognition of an investment in an associate or joint venture.
An equity instrument, initially recognized as a financial asset measured at fair value through profit or loss (FVTPL) or at fair value through other comprehensive income (FVOCI), may subsequently be accounted for under the equity method when:
In such situations, the financial asset is derecognized and the investment is recognized at the cost of the instrument on the date of reclassification, plus any directly attributable transaction costs. When an instrument previously classified as FVOCI is reclassified to the equity method, the cumulative gains or losses in other comprehensive income are reclassified directly to equity, without being recycled through profit or loss.
(ii) Associates:
Associates are entities over which the Company has significant influence, but not control or joint control, over their financial and operating policies.
Significant influence is the power to participate in the financial and operating policy decisions of an investee, but without having individual or joint control over those policies. If the investor holds, directly or indirectly, less than twenty percent of the investee’s voting power, it is presumed that the investor does not have significant influence, unless such influence can be clearly demonstrated.
For investments with an interest of less than twenty percent, the Company performs the appropriate assessments to determine whether it has significant influence.
Intercompany balances and transactions, and any unrealized income or expenses arising from intercompany transactions, are eliminated in the preparation of the consolidated financial statements.
Under the equity method, the Company’s share of the profit or loss for the period of associates is recognized in the statement of profit or loss, within “Share of profit (loss) of associates.” Unrealized gains and losses resulting from transactions between the Company and its investees are eliminated based on the Company’s ownership interest in those investees. Other comprehensive income of subsidiaries, associates, and joint ventures is recognized directly in the Company’s equity, within “Other comprehensive income."
Investments in which the Company has significant influence are measured using the equity method and, when applicable, are reduced by any provision for impairment losses.
Unrealized gains arising from transactions with investments accounted for using the equity method are eliminated against the carrying amount of the investment to the extent of the Company’s interest in the investee. Unrealized losses are similarly eliminated, but only to the extent that there is no evidence of impairment.
The Company's subsidiaries are listed below:
Direct and indirect participation in subsidiaries,excluding treasury shares
Corporate
Cosan Corretora de Seguros Ltda
100.00%
Cosan Nove Participações S.A.
87.27%
73.09%
Cosan Luxembourg S.A. (i)
Cosan Overseas Limited
Pasadena Empreendimentos e Participações S.A.
Cosan Limited Partners Brasil Consultoria Ltda.
98.13%
Barrapar Participações Ltda.
Aldwych Temple
Cosan Global Limited
Cosan Dez Participações S.A.
76.80%
FIP Celeste (ii)
Radar Propriedades Agrícolas S.A. (iii)
50.00%
Radar II Propriedades Agrícolas S.A. (iii)
Nova Agrícola Ponte Alta S.A. (iii)
Nova Amaralina S.A Propriedades Agrícolas (iii)
Nova Santa Bárbara Agrícola S.A. (iii)
Terras da Ponta Alta S.A. (iii)
Castanheira Propriedades Agrícolas S.A. (iii)
Manacá Propriedades Agrícolas S.A. (iii)
Paineira Propriedades Agrícolas S.A. (iii)
Tellus Brasil Participações S.A. (iv)
20.00%
Janus Brasil Participações S.A. (iv)
Duguetiapar Empreendimentos e Participações S.A. (iv)
Gamiovapar Empreendimentos e Participações S.A. (iv)
Moove Lubricants Holdings
70.00%
Rumo S.A. (v)
30.31%
30.40%
The following are the investments in subsidiaries as of December 31, 2025, considered relevant to the Company:
Number of shares of the investee
Investor's shares
Investor's interest
Rhall Terminais Ltda
28,580
8,574
30.00%
TGG - Terminal de Granéis do Guarujá S.A.
10.00%
543,750,625
108,750,125
Terminal XXXIX S.A.
14,200,000
7,100,000
Terminal Multimodal de Grãos e Fertilizantes S.A.
111,615,803
55,807,902
CEG Rio S.A.
1,995,022,625
746,251,086
37.41%
Companhia de Gás de Mato Grosso do Sul - Msgás
61,610,000
30,188,900
49.00%
Companhia de Gás de Santa Catarina - Scgás
10,749,497
4,407,293
41.00%
Interest in earnings of investees
Declared dividends
Reclassification to assets held for sale
Write-off related to the sale of a stake
Increase (decrease) of capital
Dividends receivable (i)
7,297
3,289
(3,000
7,586
4,297
405
4,710
16,423
6,010
(6,700
15,733
222,791
4,415
(26,000
201,206
85,201
(35,960
110,033
30,058
2,205
(524
25,805
57,544
542
653,687
43,578
(39,918
657,347
5,902
336,792
54,704
(16,203
375,293
14,055
287,476
18,000
(22,926
282,550
14,007
Vale S.A.
9,112,136
(8,892,803
(219,333
7,609
2,115
(418
9,306
(125,231
(195
(219,743
34,506
Impairment loss in an associate
Business combinations
6,170
2,335
(1,208
6,018
(1,721
15,960
7,463
(7,000
217,738
17,953
(12,900
66,415
14,247
(19,870
(60,792
Terminal Multimodal de Grãos e Fertilizantes S.A
78
(20
30,000
Companhia Paranaense de Gás - Compagás
403,532
27,656
(18,209
(413,271
292
640,332
46,179
(32,824
5,495
288,386
66,796
(18,390
16,426
297,874
13,856
(24,254
Norgás S.A.
Vale S.A
15,662,485
1,524,327
(1,041,100
(2,462,833
101,653
78,509
6,459
(138
1,288
17,611,369
(1,175,775
103,233
107,872
Financial information of associates:
Shareholders’ equity and uncovered liabilities
Net income of the year
Rhall Terminais Ltda.
38,850
(9,584
29,266
11,108
26,500
(10,150
16,350
7,987
Elevações Portuárias S.A.
2,348,302
(1,700,137
648,165
34,087
2,183,550
(1,390,465
793,085
66,042
255,599
(232,054
23,545
1,413
280,950
(259,472
21,478
(13,329
221,055
(56,784
164,271
62,033
233,962
(69,789
164,173
68,477
523,560
(266,495
257,065
105,416
121,868
(6,777
115,091
4,411
61,002
(1,032
59,970
146
1,094,185
(211,015
883,170
158,274
1,127,032
(328,564
798,468
162,847
1,412,608
(566,497
846,111
145,032
1,695,573
(953,322
742,251
184,905
341,407
(149,979
191,428
49,532
378,691
(197,859
180,832
37,640
455,316,000
(248,544,000
206,772,000
31,592,000
Business combinations are accounted for using the acquisition method. The consideration transferred in the acquisition is measured at fair value, calculated as the sum of the fair values of the assets transferred by the Company on the acquisition date, the liabilities incurred by the Company in relation to the former controlling shareholders of the acquired entity and the equity interests issued by the Company in exchange for control of the acquired entity. Acquisition-related costs are recognized in profit or loss as incurred.
The consideration transferred does not include amounts relating to the payment of pre-existing relationships. These amounts are generally recognized in the income statement.
In determining whether a set of activities and assets constitutes a business, the Company assesses whether the set of assets and activities acquired includes at least one input and one substantive process that together contribute significantly to the ability to generate output.
On the acquisition date, identifiable assets acquired and liabilities assumed are recognized at fair value on that date, except for:
When measuring fair values, valuation techniques are used which consider market prices for similar items, discounted cash flow, among others.
Initially, goodwill is measured as the excess of the consideration transferred over the net assets acquired (identifiable assets acquired, net of liabilities assumed). If the consideration is less than the fair value of the net assets acquired, the difference must be recognized in profit or loss as a gain on a bargain purchase.
After initial recognition, goodwill is measured at cost, less any accumulated impairment losses. For impairment testing purposes, goodwill acquired in a business combination is, as of the acquisition date, allocated to each of the Company's cash-generating units that are expected to benefit from the synergies of the combination, regardless of whether other assets or liabilities of the acquiree are attributed to these units.
When goodwill is part of a cash-generating unit and a portion of that unit is disposed of, the goodwill associated with the portion disposed of must be included in the cost of the transaction when determining the gain or loss on disposal. The goodwill disposed of in these circumstances is determined on the basis of the proportional values of the portion disposed of in relation to the cash-generating unit held.
Upon disposal of the cash‑generating unit, the carrying amount of the allocated goodwill is included in the determination of the gain or loss on disposal.
When the consideration transferred by the Company in a business combination includes a contingent consideration agreement, the contingent consideration is measured at fair value on the acquisition date and included in the consideration transferred in the business combination. Changes in the fair value of contingent consideration classified as measurement period adjustments are adjusted retroactively, with corresponding adjustments to goodwill. Measurement period adjustments correspond to adjustments resulting from additional information obtained during the “measurement period” (which cannot be longer than one year from the acquisition date), related to facts and circumstances existing on the acquisition date.
Subsequent accounting for changes in the fair value of contingent consideration not classified as measurement period adjustments depends on how the contingent consideration is classified. Contingent consideration classified as equity is not remeasured on subsequent disclosure dates, and its settlement is recorded in equity. The other contingent consideration amounts (liabilities or derivatives) are remeasured at fair value at each reporting date, with changes recognized in profit or loss.
When a business combination is carried out in stages, the interest previously held by the Company in the acquiree is remeasured to its fair value on the acquisition date, and the corresponding gain or loss, if any, is recognized in profit or loss. The values of the interests in the acquired entity prior to the acquisition date, previously recognized in “Other comprehensive income”, are reclassified to profit or loss, to the extent that such treatment would have been appropriate if the interest had been sold.
As this is a fair value measurement, if new information obtained within one year of the acquisition date about the facts and circumstances that existed on the acquisition date indicates adjustments to the aforementioned amounts or any additional provisions that existed on the acquisition date, the accounting for the acquisition will be reviewed. Management expects that only the measurement of intangible assets will have any impact on this assessment.
Contingent Liabilities recognized in a business combination
Contingent liabilities acquired in a business combination are initially measured at fair value on the acquisition date. At year-end, these contingent liabilities are measured at the higher of:
DIPI Holding Ltda.
On January 2, 2025, the subsidiary Cosan Lubricants e Especialidades S.A. (“CLE”) completed the acquisition of 100% of the shares of DIPI Holding Ltda. and its subsidiaries (“Grupo PAX”) for a total amount of R$ 329,006. Of this amount, R$ 232,886 was paid on the transaction date, and the remaining balance of R$ 96,120 will be settled in two installments, on the first and second anniversaries of the acquisition. The cash effect on the consolidated results was R$ 213,086, net of the acquired company's cash on the acquisition date.
The first installment is fixed, while the second installment constitutes an earn-out and is subject to adjustments according to the variation in EBITDA between the closing date and the respective reporting periods. If the consolidated EBITDA is lower than the basis EBITDA adjusted for the IPCA variation in the period, the sellers will receive a proportionally reduced amount. Furthermore, the second installment may be increased if the following conditions occur cumulatively: (i) the first installment is subject to a negative adjustment; (ii) the adjustment value of the second installment is positive; and (iii) the EBITDA of the first period was equal to or greater than 70% of the base EBITDA, respecting the maximum value of R$ 100 million for the total of the installments, subject to a maximum aggregate amount of R$ 100 million for both installments combined.
The acquisition was accounted for using the acquisition method, in accordance with IFRS 3 – Business Combinations. The significant accounting policies applied include the recognition and measurement of the identifiable assets acquired and liabilities assumed at their fair value at the acquisition date.
The PAX Group, headquartered in Brazil, operates primarily in the production and marketing of greases and lubricating oils, as well as the manufacture of plastic packaging for the lubricants market. The acquisition's main objectives were:
On the acquisition date, a preliminary goodwill of R$236,469 was recognized, representing the expected future economic benefits arising from synergies and other intangible factors not individually identifiable. The goodwill balance as of December 31, 2025, with the final allocation of the valuation report, became R$226,740, with changes in the fair value allocations in fixed assets and customer portfolio.
From the acquisition date until December 31, 2025, the consolidated income statement includes revenues and net income generated by the PAX Group in the amounts of R$ 483,435 and R$ 47,950, respectively.
Both the fair value and the gross contractual value of the acquired receivables total R$ 18,408. The Company does not expect significant losses from the non-realization of these receivables.
The table below summarizes the values of the assets acquired and liabilities assumed on the acquisition date:
Transferred consideration
Cash transfer - on the closing date
232,886
Remaining installments
Earn-out
46,120
329,006
Identifiable assets acquired and liabilities assumed
2,400
18,408
36,576
Other recoverable taxes
9,965
Property plant and equipment
91,239
Goodwill
226,740
Intangible assets (Except goodwill)
71,062
Other credits
18,583
(7,444
(18,046
(43,475
Net assets acquired
Cash received
(2,400
Consideration transferred, net of cash acquired
326,606
Non-controlling interests in subsidiaries are presented separately from the parent company's interest in consolidated equity. Non-controlling interests that represent equity interests and entitle their holders to a proportionate share of the entity's assets in the event of liquidation may be measured initially at fair value or based on the proportionate share of the acquired entity's identifiable net assets attributable to non-controlling interests. The choice of measurement method is made on a transaction-by-transaction basis. Other types of non-controlling interests are initially measured at fair value. After the acquisition, the book value of the non-controlling interests is determined by the value of these interests at initial recognition, adjusted by the portion of subsequent changes in the subsidiary's equity attributable to the non-controlling interests.
The result and each component of other comprehensive income are attributed to the Company's owners and to the non-controlling interests. The total comprehensive income of subsidiaries is attributed to the Company's owners and non-controlling interests, even if this results in a negative balance for non-controlling interests.
The following is a summary of financial information for each subsidiary that holds non-controlling interests relevant to the group. The figures disclosed for each subsidiary are before eliminations between companies.
Shares issued by the subsidiary
Non-controlling interest
Tellus Brasil Participações S.A.
106,907,867
42,664,607
80.00%
Janus Brasil Participações S.A.
286,370,051
112,905,168
Duguetiapar Empreendimentos e Participações S.A.
35,988
14,256
Gamiovapar Empreendimentos e Participações S.A.
12,132,621
4,785,951
Radar Propriedades Agrícolas S.A.
737,500
431,806
Nova Agrícola Ponte Alta S.A.
160,693,378
94,085,973
Terras da Ponte Alta S.A.
16,066,329
9,406,835
Nova Santa Bárbara Agrícola S.A.
14,360,726
8,408,205
Nova Amaralina S.A.
30,603,159
17,918,149
Paineira Propriedades Agrícolas S.A.
132,667,061
77,676,564
Manacá Propriedades Agrícolas S.A.
126,200,853
73,890,599
Castanheira Propriedades Agrícolas S.A.
83,850,938
49,094,724
Radar II Propriedades Agrícolas S.A.
81,440,221
40,720,110
Rumo S.A.
1,858,828,617
1,296,299,127
69.69%
34,963,764
17,446,918
49.90%
Corporativo
7,663,761,736
975,404,073
33.84%
160,000
3,000
1.87%
The following table presents a summary of information relating to each of the Company's subsidiaries that have significant non-controlling interests, prior to any intra-group eliminations.
Capital increase (reduction)
Transaction with shareholders
Companhia de Gás de São Paulo - COMGÁS
26,637
12,602
(387
(10,266
28,586
Commit Gas S.A.
1,357,447
159,444
182
(117,068
1,400,005
Companhia Paranaense de Gás - COMPAGAS
460,508
8,707
372
(21,359
448,228
Biometano Verde Paulínia S.A.
238,239
(4,803
233,436
Compass Gás e Energia
557,943
154,050
4,208
(77,052
639,149
10,457,452
(5,692
(46,468
(1,191,051
12,921
16,904
566,991
(10,364
(2,621
Cosan Limited Partners Brasil Consultoria Ltda
(46
46
2,164,445
(3,266,444
89,084
54,812
(331,000
1,286,270
3,779
946
980,133
523,508
35,639
7,161
(623,592
(922,798
(51
5,051,050
590,091
(232,534
(178,814
5,229,793
3,124,858
269,831
(83,738
(6,370
3,304,581
591,606
27,282
(12,015
(7,432
599,441
(2,338
207
(2,228
(167
5,327
801
1,176,870
89,026
(1,536
(36,977
64,376
1,291,759
255,348
319
(20,387
10,902
246,182
430,599
80,132
(20,033
24,808
515,506
205,827
1,738
(7,451
(17,110
(169,885
13,119
Nova Amaralina S.A. Propriedades Agrícolas
38,998
44,611
(11,019
190,291
262,881
90,250
6,976
(5,599
7,871
99,498
220,407
18,995
(7,150
11,432
243,684
216,478
19,225
(6,528
10,060
239,235
284,845
16,336
(7,047
40,426
334,560
107,816
9,516
21,049
(Reduction) Capital increase
Disposal of assets held for sale
32,145
14,726
(20,680
446
Commit Gás S.A.
1,562,500
138,356
(456,045
112,401
235
372,030
1,569
(3,446
462,197
188
237,981
1,228
(970
790,672
235,988
(179,999
(19,254
(269,808
344
11,104,589
(657,631
904
(6,676
16,266
695,848
26,028
(270,000
(3,094
(2
2,567,019
(365,149
34,202
25,796
(105,000
7,577
1,512,041
501,890
(396,395
(34,229
(603,022
(152
4,743,201
513,119
(205,270
3,156,328
359,813
(74,741
(316,542
472,244
128,911
(9,549
66,715
7,911
(17,143
(59,821
1,089,154
113,818
(584
(25,518
204,444
67,872
(16,968
417,013
21,574
(7,988
29,893
12,140
(3,035
197,833
8,239
(245
84,251
(4,238
10,237
199,303
24,339
(3,235
199,584
23,397
(6,503
291,078
(4,050
(2,183
21,810
Summary of balance sheet:
Cosan Dez
Cosan Nove
Asset
369,391
1,590,825
46,918
707,281
31,765
1,240,600
3,451,323
461,016
559,288
(15,290
(1,336,052
(19
(40,018
(1,474,294
(1,267,586
(127,550
(137,056
Current assets, net
354,101
254,773
7,444
6,900
(233,694
2,183,737
333,466
422,232
4,687,097
4,091,608
9,310,850
1,712,927
1,858,568
25,766,338
23,288,895
18,401,988
17,179,276
(11,690,002
(10,741,388
(861,011
(602,315
Non-current assets, net
14,076,336
12,547,507
17,540,977
16,576,961
5,041,198
4,346,381
9,317,750
2,420,208
1,890,333
13,842,642
14,731,244
17,874,443
Income before taxes
1,135,176
1,556,754
1,396,633
(9,652,455
(1,078,773
1,005,640
564,041
394,309
207,982
(998
(15,863
(2,301
(155
(271
(5,892
1,134,178
1,540,891
1,394,332
(9,652,610
(1,079,044
999,748
25,575
(122,246
1,957
161,974
76,229
(54,731
(34,547
86,760
(262,473
Comprehensive results
1,159,753
1,418,645
1,396,289
(9,490,636
(1,002,815
945,017
529,494
481,069
(54,491
Comprehensive income assigned to non-controlling shareholders
454
(14,728
(78,742
(1,667,187
(372,772
(371,000
(571,261
(900,000
890,149
1,064,286
1,013,446
1,003,776
(863,209
769,233
1,847,428
1,936,036
2,820,202
(156,718
(96,038)
(49,569
847,058
(959,247
719,664
1,805,751
(66,559
1,300
1,011
780,499
(957,947
720,675
704
(1,500,000
(170,817
(122,231
(649,721
(917,530
(530,576
Summary of cash flow statements:
Cash generated (used) in operational activities
3,338
35,059
(176
356
3,390
14,941
(275
(3,079
(359
Cash generated (used) from investing activities
1,772,130
2,366,296
757,196
39,751
63,262
555,408
896,369
(5,683
Cash (used) generated in financing activities
(1,790,000
(2,770,208
(40,000
(65,000
7,976
Increase (decrease) of cash and cash equivalents
(14,532
(368,853
384,248
107
1,652
(912
(6,710
1,934
Cash and cash equivalents at the beginning of the fiscal year
17,409
386,262
2,014
3,461
1,809
2,721
803
1,858
Effect of foreign exchange variation on the cash and cash equivalents balance
5,655
(76
2,877
3,568
616
395,605
469,310
674,137
530,012
999,607
626,057
(467,632
(487,467
(175,273
127,393
22,667
(30,681
(1,532,108
(692,256
445,843
(670,833
(1,029,179
(581,012
(1,604,135
(710,413
944,707
(13,428
(6,905
14,364
2,403,629
3,114,042
2,169,335
39,946
25,582
799,494
19,613
10. Investment in joint ventures
A joint venture is a joint arrangement whereby the parties that have joint control have rights to the net assets of the arrangement.
The Company has an investment in a joint venture shown in the statement of financial position as the share of net assets under the equity method of accounting, less any impairment losses. If applicable, adjustments are made to align any different accounting policies that may exist. The Company’s share of the results and shareholder’s equity of the joint venture is included in the statement of profit or loss and other comprehensive income statement of changes in equity, respectively. Unrealized gains and losses resulting from transactions between the Company and its joint venture are eliminated to the extent of the Company’s investment in the joint venture, except where unrealized losses provide evidence of an impairment of the transferred asset. Goodwill arising from the acquisition of joint venture is included as part of the Company’s investment in the joint venture and, when necessary, the carrying amount of the investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount (the higher of value in use and fair value less costs of disposal) with its carrying amount.
The investment in joint venture is considered as non-current assets and are shown at cost less any impairment losses.
When an investment in a joint venture is classified as held for sale, it is accounted for in accordance with IFRS 5.
The movements in investments in joint venture entities in the consolidated financial statements were as follows:
Raízen S.A. (i)
Alvorada Terminal S.A.
Radar Gestão de Invest. S.A.
Shares issued by the joint venture
10,352,509,484
134,936,162
24,800,000
Shares held by Cosan
4,557,597,117
67,468,081
12,400,000
Cosan ownership interest
5.00
%
Percentage of indirect interest (Cosan Nove)
25.84
30.84
50.00
11,693,876
48,566
11,742,442
(1,218,804
(3,731
Other comprehensive income and other
139,892
12,337
(119,647
10,495,317
8,606
Interest in (losses) earnings of joint ventures (Note 2.1.11)
(10,881,556
(7,274
3,807
386,239
(904
Raízen S.A.
Because the investment was reduced to zero, the unrecognized portion of losses from the investment in Raízen S.A. was R$ 712,152.
The balance sheet and income statement of the joint venture entity Raízen S.A. are disclosed in Note 4 – Segment information.
As of December 31, 2025, the Company was in compliance with the covenants of the agreement governing the joint venture.
The recoverable amount is determined through value in use calculations, using the discounted cash flow determined by Management based on budgets that take into account the assumptions related to each business, using information available in the market and past performance. Discounted cash flows were prepared over a ten-year period and carried forward in perpetuity. Management understands the use of periods greater than five years in the preparation of discounted cash flows is appropriate for the purpose of calculating the recoverable amount, because it reflects the estimated time of use of the asset and of the business groups.
The Company reviews impairment indicators for intangible assets with defined useful lives and property, plant and equipment on an annual basis. In addition, goodwill and intangible assets with an indefinite useful life are subjected to an impairment test. An impairment occurs when the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, which is the greater of its fair value less costs to sell and its value in use.
The assumptions used in discounted cash flow projections - estimates of future business performance, cash generation, long-term growth, and discount rates - are utilized in the company's assessment of impairment as of the date of the financial position. The primary assumptions used to determine the recoverable value of the various cash-generating units to which goodwill is allocated are described in the following section.
Property, plant and equipment are measured at cost less accumulated depreciation and any accumulated impairment losses.
Subsequent expenditures are only capitalized when it is probable that the associated future economic benefits flow to the company. Ongoing repairs and maintenance expenses are recorded as they are incurred.
Borrowing costs directly attributable to the acquisition, construction, or production of qualifying assets are capitalized to the cost of those assets until the date they are ready for their intended use or sale. Qualifying assets are those that necessarily require a substantial period of time to get ready for use or sale.
When borrowings at variable interest rates are used to finance a qualifying asset and designated in an effective cash flow hedge of interest rate risk, the effective portion of the derivative is recognized in other comprehensive income and reclassified to profit or loss when the qualifying asset affects profit or loss. When borrowings at fixed interest rates are used to finance a qualifying asset and designated in an effective fair value hedge of interest rate risk, the capitalized borrowing costs reflect the hedged interest rate.
Property, plant and equipment are depreciated from the date they are available for use or, in the case of constructed assets, from the date the asset is completed and ready for use.
Depreciation is calculated based on the carrying amount of property, plant and equipment, net of estimated residual values, using the straight-line method over the asset’s estimated useful life. Depreciation expense is recognized in profit or loss, unless it is capitalized as part of the cost of another asset. Land is not depreciated.
Methods of depreciation, such as useful lives and residual values, are reviewed at the end of each fiscal year or when there is a significant change without an expected consumption pattern, such as a relevant incident or technical obsolescence. If applicable, any adjustments are recorded as changes to accounting estimates.
Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, as follows:
Buildings and improvements
2% - 18%
Machinery, equipment and facilities
3% - 33%
Freight cars
2.9% - 6%
Locomotives
3.3% - 8%
Permanent ways
3% - 4%
Furniture and utensils
10% - 15%
Computer equipment
20%
10% - 20%
Land, buildings and improvements
Machines, equipment and installations
Wagons and locomotives
Permanent railways
Construction in progress
Cost
2,217,585
2,099,263
8,698,521
12,852,330
4,785,955
738,737
31,392,391
5,626
3,787
6,673,050
4,657
6,687,120
(9,310
(81,099
(519,465
(209,845
(11,116
(46,538
(877,373
299,824
1,823,557
997,886
1,171,698
(4,371,472
48,655
(29,852
Exchange differences
54,373
101,257
10,534
67,187
233,351
2,568,098
3,946,765
9,176,942
13,814,183
7,080,796
812,698
37,399,482
4,433
19,031
6,804,853
2,789
6,831,106
(36,980
(183,846
(217,586
(5,729
(82,843
(82,330
(609,314
Transfers (i)
(3,282
543,847
1,813,920
1,771,884
(3,385,532
(229,193
511,644
(23,278
(43,258
(6,566
(30,377
(103,479
69,516
40,808
29
7,398
117,751
2,578,507
4,323,347
10,773,276
15,580,338
10,410,737
480,985
44,147,190
Depreciation
(626,951
(907,235
(3,866,953
(4,510,495
(13,379
(227,404
(10,152,417
(57,606
(222,846
(627,303
(938,312
(66,861
(1,912,928
4,041
73,206
457,597
5,099
37,199
577,142
5,401
(6,881
(23,170
2,182
(22,468
(15,028
(41,044
(35,840
(91,912
(213,621
(891,604
(1,267,439
(401,513
(3,706
(2,777,883
(690,143
(1,318,421
(4,951,433
(6,711,147
(414,892
(294,430
(14,380,466
(67,006
(310,324
(685,250
(754,132
(57,186
(1,873,898
29,568
139,817
233,214
(49,980
57,967
410,586
4,802
5,121
(438,372
55,882
387
(372,180
5,693
16,857
15,507
38,057
(64,945
(109,882
(197,843
(513,152
(287,603
(139
(1,173,564
(782,031
(1,576,832
(6,039,684
(7,972,529
(702,495
(277,849
(17,351,465
1,877,955
2,628,344
4,225,509
7,103,036
6,665,904
518,268
1,796,476
2,746,515
4,733,592
7,607,809
9,708,242
203,091
In the fiscal year ended December 31, 2025, borrowing costs capitalized by the subsidiary Rumo totaled R$ 367,598, at an average rate of 14.73% (R$ 95,138 and 11.80% p.a. as of December 31, 2024), while its indirect subsidiary Biometano capitalized R$ 22,262 at a weighted average annual rate of 7.69% (R$ 39,617 and 7.36% in the fiscal year ended December 31, 2024 through its indirect subsidiary TRSP).
a) Goodwill
Goodwill is initially recognized and measured in accordance with Note 9.2.
Goodwill is not amortized, but it is tested for impairment at least annually. For the purposes of impairment testing, goodwill is allocated to each of the Company’s cash-generating units (or groups of cash-generating units) that are expected to benefit from the synergies of the business combination. The cash-generating units to which goodwill has been allocated are tested annually for impairment, or more frequently when there is an indication that the unit may be impaired.
If the recoverable amount of the cash-generating unit is lower than its carrying amount, the impairment loss is first allocated to reduce the carrying amount of the goodwill allocated to the unit and then to the other assets of the unit, on a pro rata basis according to their carrying amounts. Impairment losses on goodwill cannot be reversed in subsequent periods
b) Other intangible assets
Other acquired intangible assets with a short useful life are measured at cost, less accumulated amortization and any accumulated impairment losses.
c) Customer relationships
The subsidiaries in the Gas Distribution segment have made investments to enable customers to connect to the gas distribution network, which is necessary to allow natural gas to be supplied from the existing network.
The costs associated with the customer portfolio and right-of-use and operation contracts are considered as intangible assets and amortized over the contract's term.
d) Concession Rights
Some subsidiaries of the Cosan group have public concession contracts for the gas distribution service in which the Granting Authority controls which services will be provided and the price, in addition to holding significant participation in the infrastructure at the end of the concession. These concession contracts represent the right to charge users for gas supply during the contract term. Thus, the subsidiaries recognize this right as an intangible.
The assets acquired or constructed underlying the concession necessary for the distribution of gas are amortized to correspond to the period in which the future economic benefits of the asset are expected to be reverted to the subsidiaries, or the final term of the concession, whatever happens first. This period reflects the economic life of each of the underlying assets that make up the concession. This economic service life is also used by regulatory bodies to determine the basis of measurement of the tariff for the provision of the services object of the concession.
The amortization is recognized by the linear method and reflects the expected standard for the use of future economic benefits, which corresponds to the useful life of the assets that make up the infrastructure according to the provisions of the regulatory body.
The amortization of assets is discontinued when the respective asset is used or downloaded in full and is no longer included in the basis of calculation of the tariff for the provision of concession services, whichever occurs first.
e)Railway Concession Rights
Railway concession rights were fully allocated to the Rumo Malha Norte concession and amortized in a straight-line basis until the end of the concession in 2079.
f) Port authorization and license
The license that authorizes the installation of a private port terminal, with no expiration date as long as the property is used for this purpose.
Use and operation right contracts arising from business combinations are initially recognized as intangible assets at fair value and amortized over the term of the contract.
g)Supply Contracts
The subsidiary Biometano Verde Paulínia has entered into a purchase and sale agreement for biogas produced at the Paulínia landfill, where the purification plant is located. The contract has a term of 20 years, and its amortization is conditional upon the commencement date of operations.
h) Amortization
Except for goodwill and intangible assets with indefinite useful life, intangible assets are amortized using a straight-line method over their estimated useful lives, beginning on the date they are acquired or made available for use.
i) Assets with an indefinite useful life.
Intangible assets with an indefinite useful life are not amortized, but are tested annually for impairment losses. This sub-group is made up of goodwill and trademarks and patents. The Company expects these brands and patents to generate positive cash flows for as long as the Company retains ownership, contributing indefinitely to its cash flows since they are consolidated brands in the markets in which they are present.
At each reporting date, the depreciation methods, useful lives, and residual values are evaluated and adjusted as necessary.
Concession right
Licenses
Brands and patents
Customer relationships
Supply Agreement
1,391,974
24,297,484
243,044
155,480
2,630,947
574,363
635,380
29,928,672
12,088
87,146
90,575
189,809
(141,588
(81
(5,814
(147,483
7,824
3,296,505
1,249
19,313
3,324,891
1,431,644
(17
41,662
1,470,054
Assets held for sale
185,223
11,500
28,403
39,341
341,454
25,940
631,861
1,585,021
28,907,633
268,212
196,070
3,078,762
787,743
35,397,804
583
94,344
109,315
204,242
(4,419
(152,365
(284
(375
(157,443
264,992
14,280
58,110
2,207
339,589
(156
1,518,316
(14,177
39,698
41,208
1,584,889
(81,549
(5,872
(6,613
(16,615
(159,510
(8,558
(278,717
1,763,889
30,268,295
247,422
193,451
3,111,404
931,540
37,090,364
Amortization
(5,476,918
(63,216
(9,201
(1,288,556
(440,494
(7,278,385
(960,471
(6,978
(364,926
(44,359
(1,376,734
87,433
659
88,092
(391,372
3,264
(388,108
(762
(11,500
(9,674
(82,913
(2,597
(106,684
(4,438
(6,752,828
(79,868
(1,736,395
(488,727
(9,067,019
(1,077,772
(6,963
(683
(284,047
(70,238
(1,439,703
78,446
306
78,752
5,329
5,286
5,872
(1,229
47,306
1,038
52,987
(14,041
(7,740,953
(88,060
(9,884
(1,973,136
(571,705
(10,383,738
22,154,805
188,344
186,869
1,342,367
299,016
22,527,342
159,362
183,567
1,138,268
359,835
a)Amortization methods and useful lives:
Intangible asset (except goodwill)
Annual amortization rate
Concession Rights
From 3.54% a 4.58%
16,254,789
15,762,227
1.59%
6,272,553
6,392,578
Licenses and authorizations
Port operating license
3.70%
44,375
5.00%
114,987
143,969
Comma
Indefinity
56,577
59,255
Petrochoice
110,803
125,175
Tirreno
2,439
Pax
13,253
Tamco
495
20.00% a 50.00%
228,220
234,533
20.00% a 30.00%
910,048
1,107,834
Supply contract
5.00% (i)
Software license
230,983
220,084
128,852
78,932
24,942,737
24,745,764
b) Goodwill and intangibles with an indefinite useful life:
Below we show the carrying amount of goodwill and intangible assets with indefinite useful lives allocated to each of the cash generating units:
CGU Moove
1,626,168
1,447,300
CGU Compass
100,192
CGU Rumo
37,529
The Company's future cash flow projections generally apply growth rates of 3.36% (3.55% as of December 31, 2024), which in no case are increasing or exceeding the average long-term growth rates for the sector and country in question.
Cash flows are discounted at a given rate, before taxes, to calculate their present value. The discount rates, before taxes and expressed in nominal terms, ranged from 11.00% to 13.18% as of December 31, 2025 (from 10.90% to 13.43% as of December 31, 2024).
The main assumptions for the first year of the financial model consider inflation and Gross Domestic Product (“GDP”) by region where CGU is located, in addition to the Cosan Group's market strategies and opportunities. The main assumptions considered for the remaining years of the model are related to inflation and market growth in the sector. The discount rate used is WACC, for which the main assumptions are: risk-free rate, market risk premium, and inflation. Most of the assumptions are obtained from external sources of information.
Future cash flows were constructed considering: (i) EBITDA for the cash-generating unit, adjusted for other relevant operating cash items and recurring capital expenditures; (ii) the Cosan Group's discount rate (WACC) before taxes; and (iii) a growth rate calculated using the inflation index by region.
The annual impairment test used the following assumptions:
Premises
% annual
Risk-free rate (T-Note 10y)
3.67%
Inflation (Brazil)
3.76%
Inflation (US)
2.22%
Inflation (UK)
2.12%
Country risk Prize (BR)
Country risk Prize (UK)
0.89%
Country risk Prize (ARG)
14.80%
Market risk Prize
3.73%
Tax rate (BR)
34.00%
Tax rate (UK)
25.00%
Tax rate (ARG)
35.00%
For Moove, we performed a sensitivity analysis on key assumptions, the Weighted Average Cost of Capital (WACC), and the Compound Annual Growth Rate (CAGR). The analyses indicate that, in the case of the North America CGU, either an increase of 2.1% in the WACC, on a nominal pre-tax basis, or a decrease in the CAGR of unit revenue growth over the five-year period to below 0.8%, would represent scenarios in which a reduction in the recoverable amount could occur. A CAGR of 1.3% was applied in the impairment test. For the other CGUs, management does not expect reasonably possible changes in key assumptions to result in a reduction of the recoverable amount.
Determining the recoverability of assets depends on certain key assumptions that are influenced by the market, technological, and economic conditions prevailing at the time this recovery is tested; therefore, it is not possible to predict whether there will be future losses due to a reduction in recoverability and, if so, whether they would be material.
Except for the provisions presented in Note 11.6, the Company did not identify any additional impairment indicators during the year ended December 31, 2025. Consequently, no impairment test was required for the remaining PP&E, rights of use and intangible assets with a defined useful life.
Contract assets represent the Company’s contractual right, through its subsidiaries, related to construction work in progress related to the gas distribution concession. They are measured at acquisition cost, including borrowing costs capitalized against construction revenue.
Until the contract assets enter into operation and can be considered in the tariff-setting base for the provision of the services under the concession, the amounts represent a contractual right to receive cash from the granting authority.
When the assets enter into operation, the portion that is amortizable over the term of the concession is transferred to intangible assets, while the amortizable portion that exceeds the concession term is converted into a financial asset, as it represents a receivable from the granting authority.
1,041,421
10,684
1,052,105
16,564
1,618,848
(4,650
(22,881
(27,531
(1,585,219
56,627
15,249
1,583,534
1,837
(16,773
(14,936
(1,638,815
1,041,770
2,843
a) Capitalization of borrowing costs
During the fiscal year ended December 31, 2025, Comgás, an indirectly controlled subsidiary of the Company, capitalized R$ 79,018 in borrowing costs at a weighted average interest rate of 13.78% per annum (R$ 78,980 at 10.47% per annum in the fiscal year ended December 31, 2024).
During the fiscal year ended December 31, 2025, Sulgás, an indirectly controlled subsidiary of the Company, capitalized R$ 2,965 in borrowing costs at a weighted average interest rate of 12.20% p.a. (R$ 2,908 at 5.81% p.a. in the fiscal year ended December 31, 2024).
The right-of-use asset is initially measured at cost, which includes:
The right-of-use asset is then depreciated on a straight-line basis from the date of commencement until the end of the lease term, unless the lease transfers ownership of the underlying asset to the lessee at the end of the lease term, or if the cost of the lease right-of-use asset reflects the likelihood that the lessee will exercise the purchase option. In this instance, the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined in the same manner as property, plant, and equipment. In addition, the right-of-use asset is periodically adjusted for certain remeasurements of the lease liability and impairment losses, if any.
Railway concessions are usually classified and measured under Interpretation IFRIC 12 - Service Concession Arrangements. However, as they do not meet the criteria defined in this interpretation, the Company recognized its concession contracts as a right-of-use asset.
Machinery, equipment and installations
Software
Vehicles
Floating storage and regasification
Railway and port
517,089
521,120
943,428
85,949
60,164
1,533,969
8,096,285
11,758,004
54,516
62,354
4,420
98,445
60,465
801,375
1,081,575
Contractual adjustments
3,928
298
9,412
1,771
82,927
98,356
(14,196
(550
(190
2,626
24,157
63,156
5,992
15,632
84,780
646,024
589,214
957,260
87,720
176,697
1,594,434
8,980,587
13,031,936
132,165
31,900
105,274
59,482
150,410
479,231
9,737
60,571
10,494
259
(7,172
178,776
252,665
(20,583
(44,941
(332
(65,856
(686,837
(32,420
(4,048
(15,616
(52,084
Fair value adjustment
10,063
168
10,244
744,986
632,709
280,917
87,979
259,019
1,653,916
9,309,773
12,969,299
(187,268
(146,748
(468,555
(25,354
(34,737
(38,349
(1,343,475
(2,244,486
(107,047
(59,510
(33,829
(4,499
(17,581
(78,030
(308,047
(608,543
3,610
247
(2,761
1,872
2,968
(25,523
(3,616
(3,473
(32,612
(4,902
(726
(5,628
(184,884
(321,130
(209,627
(505,145
(29,853
(54,645
(116,379
(1,836,406
(3,073,185
(132,054
(73,751
(16,318
(4,788
(56,070
(81,278
(256,778
(621,037
10,421
23,373
1,470
35,264
372,463
16,214
2,430
1,748
20,392
(627
(253
(39,253
(40,267
(427,176
(257,709
(149,253
(34,641
(107,497
(197,657
(2,132,437
(3,306,370
324,894
379,587
452,115
57,867
122,052
1,478,055
7,144,181
317,810
375,000
131,664
53,338
151,522
1,456,259
7,177,336
Investment properties are initially value at cost, including transaction costs. Upon initial recognition, investment properties are measured at fair value, which reflects market conditions at the reporting date, with changes recorded in the statement of profit or loss.
Revenue from the sale of agricultural properties is recognized in profit or loss only when the following conditions are met:
i. the sale is complete;
ii. the Company determines that payment by the buyer is probable;
iii. the revenue can be reliably measured; and
iv. the Company has transferred all risks associated with the property to the buyer and no longer has any involvement with the property.
The gains from the sale of agricultural properties are reported as net income on the statement of profit or loss, while the costs are reported as cost of properties sold.
The fair value of agricultural properties was determined using the direct comparative method of market data applied to transactions involving comparable properties (type, location, and quality of property) and, to a lesser extent, using sales quotes for potential transactions involving comparable assets (level 3).
The methodology used to determine fair value considers significant assumption such as direct comparisons of market information, such as price market surveys, value normalization, spot market prices, and other assumptions, such as sales, distances, infrastructure, land access, topography and soil conditions, land use (type of crop), and rainfall levels, among other data. This methodology is in accordance with the standards issued by the Brazilian Association of Technical Standards (Associação Brasileira de Normas Técnicas, or "ABNT").
The discount rate was 9.25% p.a. on December 31, 2025 (6.06% p.a. and 10.40% p.a. on December 31, 2024).
The portfolio is evaluated annually by external specialists and periodically by internal professionals who are technically qualified to conduct this type of evaluation.
Investment properties
15,976,126
Change in the fair value of investment properties
1,273,033
7,055
(437,080
(215
1,441,276
16,463
Transfers (Note 8)
(50,403
(4,474
We present the summarized composition for the Consolidated:
Rumo Malha Sul S.A .
1,227,872
TUP Porto São Luís S.A.
265,880
1,493,752
Rumo Malha Sul S.A.
Extreme weather events that occurred in the second quarter of 2024 caused significant damage to the railway infrastructure of Rumo Malha Sul S.A. (“Rumo Malha Sul”), located in the state of Rio Grande do Sul.
The extent of the damage, coupled with the high reconstruction costs, has generated uncertainty regarding the renewal of the railway concession, whose initial expiration date is set for February 2027, although the subsidiary Rumo S.A. continues to make its best efforts in this process.
In the fiscal year ended December 31, 2025, Rumo Malha Sul identified persistent impairment indicators, fully recognizing the impairment loss on the asset arising from the railway concession. The total amount of the loss recognized in the year's results was R$ 1,227,872.
The recoverable amount of the unit was determined from its value in use, obtained through discounted cash flow, prepared basis on updated projections approved by Management. The last projection made, until the full recognition of the asset impairment provision , used the following main assumptions:
As of December 31, 2025, the Company assessed the fair value less costs to sell of its interest in TUP Porto São Luís S.A. (Porto São Luís), classified as an asset held for sale. The fair value was determined basis on a non-binding offer, considered the best available evidence of the price that would be charged by market participants, adjusted for estimated disposal costs.
As a result of this assessment, an impairment loss of R$ 265,880 was recognized.
Gas supply
Natural gas supply contracts have specific characteristics, including minimum withdrawal obligations by the Company (take-or-pay for the commodity and ship-or-pay for transportation). If the Company consumes volumes below the contracted minimums, it is required to pay the difference between the consumed volume and the minimum contracted volumes, with the possibility of offsetting such differences through additional consumption during the contract term, provided that consumption exceeds the minimum contracted amount.
Additionally, the contracts allow for the recovery of any accumulated volume. Based on consumption projections and current contractual conditions, management estimates that it will be possible to fully recover the volumes accumulated to date, considering that, during the recovery period, no new accumulations related to the minimum commitments for that period will occur.
Given the recoverable nature of these rights, amounts paid but not used are recognized as an asset under ‘Unused transportation.’ Management applies significant estimates and judgments to assess the recoverability of these volumes, taking into account demand projections, market conditions, and consumption history, which are subject to periodic review and may be adjusted in future periods depending on economic and operational circumstances.
Considering the current gas supply contracts, the subsidiaries have financial commitments totaling an estimated present value of R$ 22,926,446.
Rumo concession
The sub-concession contracts in which Rumo, through its subsidiaries generally include commitments to execute investments with certain characteristics during the term of the agreement. These include:
The Subconcession Agreement of the Central Network stipulates investments within a defined timeframe (ranging from one to three years from the date of contract execution on July 31, 2019), estimated by ANTT at R$ 645,573.
The Company records concessions payable as follows:
Lease and concession in dispute:
Rumo Malha Oeste S.A.
2,786,696
2,442,600
Installment Leases :
Rumo Malha Paulista S.A.
805,884
940,215
Concessions:
61,339
68,487
298,340
238,146
Rumo Malha Central S.A.
35,986
31,742
395,665
338,375
3,988,245
3,721,190
a) Disputed lease and concession
On July 21, 2020, Rumo, a subsidiary of the Company, filed a request with ANTT to join the third-party re-bidding process for the object of the Concession Contract signed between Rumo Malha Oeste and the Union, through the Ministry of Transport (Re-bidding Process), under the terms of Law No. 13,448, of June 5, 2017, and regulated by Decree No. 9,957, of August 7, 2019.
As a result of this process, an addendum to the concession contract was signed and, by joint decision of the parties, the action for economic and financial rebalancing filed by Rumo Malha Oeste against the Union was suspended. This action had a favorable judgment in the first instance and was awaiting appeal judgment in the Regional Federal Court.
The total amount of judicial deposits related to the cases is R$ 30,202 as of December 31, 2025 (R$ 27,897 as of December 31, 2024).
b) Leases and grants within the scope of IFRS 16
Leases:
175,328
309,269
295,476
363,588
17,412
82,331
488,216
755,188
Grants:
Rumo Malha Paulista S.A. (renewal)
1,834,965
1,673,889
1,314,214
1,111,043
3,149,179
2,784,932
3,637,395
3,540,120
541,272
547,492
3,096,123
2,992,628
The Company incurs various taxes and contributions, including municipal, state, and federal taxes, taxes on regulatory fees, and income tax, among others. Additionally, it is subject to other taxes that the Company is obliged to collect as withholding taxes from third parties and which generally do not represent an expense.
Tax debts installments
161,182
254,302
ICMS
188,080
227,563
COFINS
114,361
152,066
PIS
23,046
24,054
Social Security charges
51,648
50,975
IRRF
13,006
40,708
150,587
143,419
701,910
893,087
The amounts due in non-current liabilities have the following maturity schedule:
From 13 to 24 months
8,379
6,667
From 25 to 36 months
2,676
7,957
From 37 to 48 months
919
From 49 to 60 months
996
Over 60 months
165,647
238,706
Brazilian Tax Reform (IBS and CBS)
Constitutional Amendment No. 132, dated December 20, 2023, and Complementary Law No. 214, dated January 16, 2025, established the Reform of the National Tax System on consumption. This reform promotes the gradual replacement of taxes currently levied on goods and services—notably PIS, COFINS, ICMS, and the tax on services (Imposto sobre Serviços, or “ISS”)—with the tax on goods and services (Imposto sobre Bens e Serviços, or “IBS”) and the contribution on goods and services (Contribuição sobre Bens e Serviços, or “CBS”).
The legislation establishes a transition period starting in 2026. During this period, current taxes will coexist with the new taxes, with full implementation scheduled for subsequent fiscal years according to the legal timetable.
The Cosan Group operates in various economic segments through its subsidiaries and associates. These segments include energy and fuels, logistics and transportation, Tmobility and lubricants, infrastructure and real estate assets, and agricultural and related activities, among others. Each segment has distinct operational models, value chains, and tax regimes, which may lead to different effects from the implementation of IBS and CBS, depending on the specific regulations for each activity.
In this context, impacts from the Tax Reform will likely materialize mainly in the Group’s operating subsidiaries. These could have indirect effects on the consolidated financial statements, including changes to cost structures, pricing, tax credit dynamics, and consolidated cash flows, among other aspects.
Management has formed internal working groups to monitor the Tax Reform. These groups cover regulatory analyses, economic and financial assessments, and system adaptations, with support from specialized external advisors. These analysis are ongoing and consider factors such as the development of implementing regulations, interpretations by relevant authorities, and the specifics of each of the Company’s operating segments.
As of December 31, 2025, there are no impacts from the Tax Reform on Consumption taxes to recognize. Management will continue to monitor changes in applicable legislation and regulations, as well as relevant operational developments, to assess promptly any need for recognition or additional disclosures.
The total rate of income tax and social contribution is 34%. Current tax and deferred tax are recognized in profit or loss, with the exception of certain transactions which are directly recognized in shareholder’s equity or other comprehensive income.
a) Current tax
It is the expected tax payable or receivable on taxable profit or loss for the year, using tax rates enacted or substantively enacted as of the date of the financial position, as well as any adjustments to tax payable in respect of prior years.
b) Deferred tax
Deferred tax is recognized as temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation and tax loss.
The measurement of deferred tax reflects how the Company expects, at the end of the reporting period, to realize or settle the carrying value of its assets and liabilities. Deferred tax is measured at the rates anticipated to be applied to temporary differences upon their reversal, using rates enacted or substantively enacted as of the date of the financial position.
If there is a legally enforceable right to offset current tax assets and liabilities, and if they relate to taxes imposed by the same tax authority on the same taxable entity, deferred tax assets and liabilities are offset.
c) Tax Exposure
In calculating the amount of current and deferred tax, the Company considers the impact of uncertain tax positions and the possibility of additional taxes and interest being owed. This evaluation is based on estimates and hypotheses and may involve a series of future event judgments. New information may become available, causing the Company to change its opinion regarding the sufficiency of existing tax liabilities; such changes in tax obligations will have an impact on tax expenses in the period in which the determination is made.
d) Recoverability of deferred income tax
When evaluating the recoverability of deferred taxes, Management takes future taxable income projections and changes in temporary differences into account. The recoverability of the deferred tax asset in the parent company depends on taxable income projections. When it is unlikely that a portion or all the tax liability will be realized, the tax asset is reversed. No deadline exists for the utilization of tax losses and negative bases, but the utilization of these accumulated losses from prior years is limited to 30% of annual taxable income.
The Company and its subsidiaries are committed to good tax practices, observing the applicable laws and regulations in the countries where they operate. They also commit to adopting transfer pricing policies aligned with the arm’s‑length principle and with the rules established by the tax legislation of the jurisdictions in which they operate, ensuring transparency in transactions, business ethics, and the non‑use of practices that result in the artificial reduction of the tax burden.
a) Reconciliation of income tax and social contribution expenses:
Loss (profit) before taxes
Income tax and social contribution at nominal rate (34%)
2,717,037
1,783,340
(1,738,675
Adjustments for calculating the effective rate
Interest in earnings of investees (non-taxable income)
(3,626,134
(1,422,337
672,947
Result of companies abroad
(105,143
(93,121
(62,870
Granted income tax incentive
346,386
407,231
279,941
(26,895
(174,335
(191,763
Non-deductible expenses (donations, gifts, etc.)
(11,477
(23,234
(16,787
Tax losses not recorded
(2,362,375
(4,193,767
(308,358
ICMS benefit - extemporaneous tax credits
(1,263
20,490
5,506
ICMS benefit - current year
(521
68,409
Dividend income
254,260
Provision for non-realization of the benefit of the federal pact
(307,099
Provision for non-realization of the benefit of the federative covenant - Interest and Fine
25,851
100,731
Selic on indebtedness
50,686
60,873
147,741
Rate differential (i)
454,416
534,837
805,725
Benefits of joining the Zero Litigation Program
23,276
361,646
(115,829
(7,410
Income tax and social contribution (current and deferred)
Effective rate - %
27.57%
60.83%
(5.37%
b) Deferred income tax assets and liabilities:
Below are presented the tax effects of temporary differences that give rise to significant parts of the company's deferred tax assets and liabilities:
Active credits from:
Income taxes losses
1,777,782
1,699,262
Negative base of social contribution
590,380
560,110
Temporary differences:
Foreign exchange variation - Loans and borrowings
1,366,606
2,669,489
Provision for lawsuits
257,691
272,886
Impairment provision (Rumo Malha Oeste)
30,547
23,436
129,938
128,046
Provisions for uncertain tax credits and tax losses
53,662
44,202
Provision for non- recoverability of taxes
68,210
70,719
Share-based payment transactions
90,861
103,454
236,278
312,402
Unrealized loss with derivatives
696,110
Fair value adjustment on debts
32,268
Provisions for profit sharing
118,658
131,254
Business combination - Intangible assets
106,524
124,628
Business combination – Property, plant and equipment
1,854
Selic on undue payments
73,113
76,745
Other provisions
812,648
682,385
Deferred tax on pre-operating income
69,314
79,402
Regulatory current account
8,396
170,404
245,221
6,682,848
7,624,513
Deferred tax liabilities from:
Temporary differences
Exchange rate variation - Loans and borrowings
(24,778
(347
(107
Useful life review
(839,880
(531,081
Business combination – fixed assets
(174,359
(161,784
Tax goodwill
(609,096
(645,297
Unrealized income with derivatives
(400,672
(369,763
Fair value adjustment on debt
(559,450
(801,022
Securities and bonds
(31,437
(567,263
(496,395
Goods intended for sale
(11,906
(962
Effects on the formation of joint ventures
(33,776
(167,196
Business Combination – Intangible assets
(4,902,079
(4,990,657
Post-employment obligations
(4,815
(4,810
(11,101
(11,557
Provisions
(449,153
(484,440
(472,592
(9,104,205
(9,102,723
Total deferred taxes recorded
(2,421,357
(1,478,210
(6,125,221
(5,973,506
Total deferred, net
The Company determined the period for offsetting its deferred tax assets on tax losses, social contribution negative basis and temporary differences based on the projection of its taxable income and long-term strategic planning, with the following realization expected as of December 31, 2025:
Within 1 year
1,338,555
284,141
525,531
342,253
204,872
5 to 8 years
628,567
8 to 10 years
379,945
Tax loss and negative basis
Unrealized gains on derivatives
Exchange rate variation - Loans and financing
3,644,051
823,286
1,045,267
161,840
150,336
124,379
1,292,954
828,173
8,070,286
Credited / charged in the profit or loss
(1,343,586
(433,630
5,398
4,990
(22,290
249
1,376,535
(181,847
(594,181
966
145,572
146,538
Zero litigation
(41,093
42,963
2,259,372
1,093,628
646,326
108,790
305,488
172,605
(76,124
1,892
(18,104
(1,302,883
(75,621
(883,957
(14,233
2,368,162
1,222,758
556,472
(103,992
(299,965
(449,561
(4,641
(4,426,881
(456,093
(195,232
(281,784
(1,468,540
(7,686,689
(63,204
(69,798
301
(169
126,999
(74,988
194,885
(519,238
(238,926
(644,138
(45,513
Business Combination
(690,775
(35,608
(726,383
(449,260
(1,788,587
133,420
(30,909
(5
88,578
(308,799
(24,431
241,572
(132,365
(32,832
(16,290
(1,889,602
Total deferred taxes recognized
d) Unrecognized tax losses and temporary differences and Provision for non-realization of recoverable tax losses in the fiscal year
In the year ended December 31, 2025, the unrecognized deferred tax assets in respect of income tax and social contribution losses and temporary differences totaled R$ 8,560,792 (R$ 6,427,740 as of December 31, 2024), relating to tax losses and temporary differences. Currently, these amounts do not meet the requirements for accounting for deferred tax assets due to the lack of predictability of future taxable profit generation.
Management will continue to periodically monitor projections of future taxable profits and will adjust the provision as necessary, in accordance with changes in the Company's economic and financial conditions.
e) Uncertainties regarding the treatment of income tax
The Company is engaged in administrative and judicial discussions with the tax authorities in Brazil regarding certain interpretations and positions adopted in the calculation of Corporate Income Tax (“IRPJ”) and Social Contribution on Net Income (“CSLL”). The final determination of these issues is uncertain and may be influenced by factors beyond the Company's control, such as changes in case law and modifications to tax legislation.
In accordance with IFRIC 23 - Uncertainty Regarding the Treatment of Income Taxes, the Company assesses, for each uncertain tax position, whether it is probable that the tax authority will accept the treatment adopted or planned in the calculation of taxes.
Only in cases where the Company concludes that acceptance of the tax treatment by the competent authority is unlikely are the effects of uncertainty recognized, based on the best method for predicting the resolution of the issue — either the most probable value or the expected value.
The tax positions adopted by the Company are supported by opinions from specialized legal advisors. The Company is subject to review by the tax authorities regarding income tax for a period of up to ten years, depending on the jurisdiction in which it operates.
As of December 31, 2025, the total amount of assessments under dispute with the tax authorities related to these matters, for which it is probable that the tax authority will accept the uncertain tax treatment, was R$ 6,859,878 in the Consolidated (R$ 7,052,491 as of December 31, 2024).
Regarding probable tax contingencies, the Company has tax assessments issued by the Brazilian Federal Revenue Service and judicial proceedings related to: (a) disallowance of amortization of goodwill expenses based on expected future profitability arising from corporate transactions; (b) capital gain on the sale of an equity interest; (c) labor provisions; and (d) rectification of offsetting declarations due to partial restitution of credits subject to the offset request.
Pillar Two tax rule
Cosan Group has subsidiaries abroad in jurisdictions where the global minimum taxation rules (“Pillar Two” – Global Anti-Base Erosion Rules, or “GloBE Rules”) have been enacted and in effect since January 1, 2024, which may, under certain circumstances, result in the requirement to pay supplementary taxes (“top-up tax”) on profits earned in those jurisdictions.
Considering that entities consolidated by Cosan Group operating in Argentina, Spain, the United States, France, the Netherlands, Luxembourg, Paraguay, Portugal, the United Kingdom, Russia, and Switzerland may be directly or indirectly covered by this legislation, the Group carried out internal assessments to estimate its potential exposure to the GloBE Rules. These assessments were based on the most recent accounting and tax information available. Based on preliminary analyses and currently available information, the Group does not expect, any material impacts or the creation of significant obligations related to Pillar Two for the year ended December 31, 2025, without prejudice to revisions resulting from regulatory changes, applicable interpretative guidelines, and/or updates to the bases used.
In Brazil, the Additional Social Contribution on Net Income (“CSLL Additional Tax”) was established as part of the adaptation of Brazilian legislation to the GloBE Rules, through Law No. 15,079 of December 27, 2024, regulated by RFB Normative Instruction No. 2,228 of October 3, 2024, effective from January 1, 2025. The rule establishes a minimum effective tax rate of 15% for multinational groups that meet the legal criteria. Management has performed preliminary calculations based on currently available information from Brazilian subsidiaries, and there is no expectation of material impacts related to the CSLL Additional Tax.
Additionally, considering the simplifying rules foreseen under Pillar Two (safe harbors) and the expectation of their extension until 2027, Management does not foresee, at this time, any significant changes to the scenario currently observed until that date, nor any material effects associated with the application of supplementary taxes (top-up tax). Even though certain Group entities may not fully qualify under the simplifying rules and are subject to the full calculation of the GloBE Rules, the assessments carried out in both cases did not indicate material impacts or supplementary tax due. The possibility of regulatory changes, interpretative guidelines, and/or changes in the stage of implementation by applicable jurisdictions remains reserved.
The provisions are recognized as liabilities when the Company has a present obligation (legal or constructive) arising from a past event, it is probable that there will be an outflow of resources to settle the obligation, and the amount of the obligation can be estimated with reasonable accuracy. The recognition of the provision is accompanied by the corresponding expense entry in the income statement.
The assessment of the probability of capital outflows considers the evidence available at the balance sheet date, including the regulatory hierarchy, prevailing case law, recent court decisions and their relevance to the Brazilian legal system, as well as opinions from specialized external legal advisors. provisions are reviewed at each balance sheet date and adjusted based on circumstances, such as the expiration of the statute of limitations, the conclusion of tax proceedings, or the identification of additional exposures based on new facts or judicial decisions.
a) Probable losses and judicial deposits:
Tax
694,524
745,896
Civil, environmental and regulatory
907,205
818,422
Labor
456,393
480,315
769,351
801,723
182,809
134,058
120,822
120,909
The movement of provisions for legal proceedings during the fiscal year was as follows:
813,732
512,979
387,692
1,714,403
Provisioned in the year
129,619
181,734
154,193
465,546
Write-offs by reversal / payment
(138,562
(187,735
(168,112
(494,409
1,382
91,913
4,831
98,126
Interest (i)
(60,275
219,531
101,711
260,967
69,981
243,209
122,498
435,688
(60,024
(211,774
(210,315
(482,113
Transfer
(124,484
1,089
2,287
3,376
63,155
56,259
61,608
181,022
The Company has debts secured by assets or through cash deposits, bank guarantees, or surety bonds.
The Company holds additional indemnification claims beyond those mentioned, which, being considered probable, were not recorded as they represent contingent assets.
The main tax litigation cases for which the risk of loss is considered likely are described below:
Compensation with FINSOCIAL (i)
351,539
337,351
INSS (ii)
117,264
101,399
ICMS credit (iii)
104,889
64,708
PIS and COFINS
6,081
34,412
IPI
23,449
64,969
91,302
143,057
The Company and its subsidiaries are named as defendants in several labor lawsuits filed by former employees and outsourced service providers. The claims include demands for additional compensation and various types of damages.
Additionally, the Company is a party to public civil actions filed by the Labor Prosecutor's Office, related to alleged violations of labor standards, working conditions, and the work environment. Regarding the allegations found to be valid, the Company has entered into Settlement Agreements (“TACs”) with the competent authorities.
The Company and its subsidiaries are parties to several indemnification lawsuits, public civil actions, and administrative proceedings. Individually, these proceedings are not considered significant, and, basis on the assessment of its legal advisors, the risk of loss is classified as probable.
b) Possible losses
The following describes the main processes for which the risk of loss is considered possible:
8,392,969
8,624,545
6,864,896
6,569,528
814,364
690,535
16,072,229
15,884,608
Isolated fine - Federal tax (i)
856,908
847,582
ICMS - Tax on circulation of goods (ii)
3,021,717
2,996,997
IRRF (iii)
925,890
869,346
PIS and COFINS (iv)
1,888,292
2,174,274
MP 470 installment of debts (v)
281,285
253,793
Stock Grant Plan
33,387
32,087
IOF on loans (vi)
68,168
195,098
Reward Credit Compensation (vii)
162,357
157,959
IPI - Tax on industrialized products(viii)
381,282
333,185
INSS
209,118
159,983
IPTU Urban Property Tax (ix)
143,077
128,700
421,488
475,541
Civil
3,227,973
3,355,370
Environmental
1,618,201
1,691,409
Regulatory
2,018,722
1,522,749
The Company and its subsidiaries are parties to several judicial and administrative proceedings in the civil, environmental, and regulatory spheres, with a prognosis of possible losses.
Environmental:
Regulatory:
Labor:
Labor claims
Rumo Malha Paulista is a party in a class action lawsuit currently being processed in the Labor Court. The lawsuit originated from an inspection carried out at MS Teixeira, a subcontractor of Prumo Engenharia Ltda. (Prumo Engenharia), which, in turn, was contracted by Rumo. The inspection alleged that the workers at MS Teixeira were working in degrading conditions analogous to slavery.
Prumo Engenharia assumed full responsibility for the employees' situation, including labor and contractual liabilities, as well as all damages arising from the alleged working conditions established by its subcontractors. Prumo Engenharia terminated the employment contracts of these workers, which were approved by the then Ministry of Labor and Employment, without any participation from Rumo.
Furthermore, a criminal investigation was initiated against Rumo, which was later dismissed. However, the Labor Public Prosecutor's Office filed a class action lawsuit against Rumo Malha Paulista, without including Prumo in the litigation, requesting payment of compensation for collective moral damages in the amount of R$ 100,000 (among other commitments). The action was partially successful, condemning the subsidiary to obligations to act and refrain from acting, as well as collective moral damages in the amount of R$ 15,000.
Rumo reached an agreement with the Labor Prosecutor's Office, in which it undertook to comply with several obligations related to working conditions and paid compensation in the amount of R$ 20,000, destined for various social entities. The agreement was judicially approved by the Superior Labor Court.
After the approval, the Attorney General's Office (“AGU”) filed an appeal questioning, solely and exclusively, the destination of the compensation, since, in the view of the Attorney General's Office, the compensation should be allocated to the Workers' Assistance Fund (“FAT”). The appeal was judged and not granted, maintaining the allocation of the amounts as per the agreement signed.
The Company proved payment and presented evidence of compliance with the agreement's obligations in the case files and is awaiting a declaration of full compliance with the agreement by the Court.
In 2025, the Labor Public Prosecutor's Office filed a Rescission Action against Rumo and the AGU, requesting the annulment of two clauses of the agreement: (i) registration of companies in the Register of Employers that have subjected workers to conditions analogous to slavery and (ii) disclosure of the agreement on the government website of the Ministry of Labor and Social Security. The defense presented is awaiting judgment.
a) Share capital
Equity is reduced by the incremental costs directly attributable to the issuance of common shares. In accordance with the policy outlined in Note 15 - Income tax and social contribution, transaction costs related to income tax are accounted for in accordance with Note 15 - Income tax and social contribution.
Transactions involving group shareholders are allocated within Equity Transactions- Capital reserve, such as share-based payments and changes in interests in subsidiaries
On April 30, 2025, at an Annual General Meeting (“OGM”), the Company's shareholders approved a reduction in the Company's share capital in the amount of R$ 649,805, with the objective of absorbing the balance of the Accumulated Losses account.
On October 23, 2025, an Extraordinary General Meeting approved an increase in the Company's share capital by up to 8,000,000,000 common shares. As mentioned in note 1, on November 14, 2025, the Company issued 2,100,000,000 shares at a price of R$ 5.00 per share, totaling R$ 10,500,000, of which R$ 2,100,000 were allocated to share capital and R$ 8,400,000 to capital reserves. The share capital increased from R$ 8,182,739 to R$ 10,282,739. The following is a breakdown of the net capital raised after expenses incurred:
Increase in capital reserves
8,400,000
Expenses deducted from fundraising (i)
(230,000
Net balance raised
As of December 31, 2025, the subscribed capital was R$ 10,282,739 (R$ 8,832,544 as of December 31, 2024), fully paid up and represented by 3,966,570,932 registered, book-entry common shares with no nominal value.
As of December 31, 2025, the Company's share capital consisted of:
Common shares
Shareholding structure
Amount
Aguassanta Holdings (Controller)
Shareholding block
1,450,000,000
36.56%
Aguassanta
150,000,000
Other investors
1,300,000,000
19,415,029
0.49%
Free float
1,817,700,638
45.82%
Outstanding shares
3,959,428,597
99.82%
7,142,335
0.18%
b) Treasury shares
Treasury shares consists of shares that have been repurchased by the company for specific and limited purposes. Cosan holds the necessary number of shares for future employee share-based payment plans, and the volume is treated similarly to treasury shares for accounting purposes.
On January 14, 2025, the Company repurchased 4,200,000 shares of its own issuance for a total amount of R$ 34,022, resulting in an average cost of R$ 8.10 per share.
As of December 31, 2025, the Company held 7,142,335 treasury shares (compared to 3,747,965 shares as of December 31, 2024), with a market price of R$ 5.30.
c) Statutory reserve – special reserve
The purpose of the statutory reserve is to strengthen working capital and finance the maintenance, expansion, and development of the activities that comprise the company's corporate purpose.
d) Legal reserve
The legal reserve is constituted by appropriating 5% of the net profit for the fiscal year, up to a limit of 20% of the share capital, in accordance with Law No. 6,404/76.
e) Dividends
According to the Company's bylaws, at the end of each fiscal year, a minimum mandatory dividend is allocated, corresponding to 25% of the annual net profit adjusted for changes in the equity of the reserves, in accordance with corporate law.
Dividends, the allocation of net profit for the fiscal year, and the excess of profit reserves, as determined in article 199 of the Brazilian Corporations Law (Law No. 6,404/76), will be subject to resolutions at the next Annual General Meeting.
i. Receivable
Investment in associated (i)
Investments in joint venture
35,836
219,941
255,777
1,175,775
119,647
1,295,422
Other changes
(84,945
Dividends received
(1,018,794
(293,912
(1,312,706
45,676
125,231
126,135
(91,173
(36
(91,209
(107,424
(45,640
(153,064
ii. Payable
549,054
2,994,771
Dividends paid to preferred shareholders
2,831,692
(8,635
c) Other comprehensive income
Comprehensive income (loss)
Income on cash flow hedge
(2,436,078
(2,235,819
1,378,520
1,323,483
(76,336
(75,364
Fair value loss on financial liabilities designated at fair value through the outcome attributable to changes in credit risk
Losses in the measurement of a derivative financial instrument
Change in the fair value of a financial asset
39,726
Predecessor adjustment
1,381,798
302,630
69,215
371,845
Attributable to:
(263,225
(253,709
Comprehensive loss (income)
Loss on cash flow hedge
(2,042,427
841,409
(183,651
Loss in the measurement of a derivative financial instrument
51,855
(262,470
Earnings per share, both basic and diluted, are a financial indicator that shows a company's net income per common share outstanding.
a)Basic Result per Share
Basic earnings per share are calculated by dividing earnings attributable to the Company's shareholders by the weighted average number of common shares outstanding during the fiscal year, excluding common shares purchased by the Company and held as treasury shares.
b)Result Diluted by Share
Diluted earnings per share are calculated by dividing the income attributable to the holders of common capital of the parent company by the weighted average number of common shares outstanding during the year plus the weighted average number of common shares that would be issued upon conversion of all potentially dilutive common shares into common shares.
The following table shows the calculation of the result per share (in thousands of reais, except for the values per share).
Basic and diluted – Continuous operation
Profit or loss attributable to holders of common share of the Company used in the calculation of basic earnings per share.
(9,608,882
1,078,737
Diluting effect of the share-based plan of subsidiaries
(201
(814
Profit or loss attributable to holders of common share of the Company used in the calculation of diluted earnings per share
(9,722,326
1,077,923
Weighted average of the number of common shares in circulation – basic (in thousands of shares)
2,498,037
1,862,704
1,867,005
Diluted share-based payment plan
7,341
Share repurchases
(27,762
(257
2,470,275
1,862,447
1,874,346
(Loss) earnings per share
R$(5.16
R$0.58
Basic and diluted – Discontinuous operation
Profit or loss attributable to holders of the Company's common stock used in the calculation of basic and diluted earnings per share
185,087
15,654
Profit or loss attributable to the Company's common stockholders used in the calculation of diluted earnings per share
Weighted average number of common shares outstanding - basic (in thousands of shares)
7,354
1,870,058
Earnings per share
R$0.10
R$0.01
Diluting instruments
Share repurchase plan: 27,762,353 shares related to the Company's share buyback plan were included in the calculation of diluted earnings (loss) per share, as their potential effect is to reduce earnings per share (or increase loss per share, in the case of a negative result).
Anti-dilution instruments
Share-based payment plan: 6,023,178 shares (7,353,624 as of December 31, 2024 and 12,269,677 as of December 31, 2023) related to the Company's share-based payment plan were analyzed for the calculation of diluted earnings per share. However, these shares did not impact the calculation of diluted earnings per share for the twelve-month period ended December 31, 2025, as their potential effect would be to increase earnings per share (or reduce loss per share), thus acting as anti-dilutive shares.
The Company presents gross revenue from sales and services, sales deductions, rebates and taxes, as required for Brazilian companies according to Law No. 6,404/76, Section V, Art. 187. The main sources of revenue are:
i.Sale of products
Sales revenues are recognized when (or as) the Company satisfies the performance obligation by transferring the product or service to the customer. The asset is transferred when (or as) the customer obtains control of that asset. Revenue is recognized at that point, provided that revenue and costs can be measured reliably, the receipt of consideration is probable, and there is no continuing managerial involvement with the products.
The lubricants are sold in identified contracts with individual customers and in sets, as a package of goods or services.
Some lubricant sales contracts cannot be purchased separately from a package of services. However, the goods and services are clearly distinguished in the contracts. This type of sales represents two separate performance obligations and, therefore, revenue will be recognized for each of these performance obligations when control of the respective goods and services is transferred to the customer. The transaction price is allocated to different performance obligations based on the stand-alone selling price, in which revenues are identified, measured and recorded separately. Trade incentives, including cash incentives, volume discounts and rebates, and free or discounted goods or services, are accounted for as a reduction in revenue.
ii.Billed revenue
The Company, through distributors directly and indirectly controlled by Compass Gás e Energia, provides natural gas distribution services in the locations where they hold the concession right. The fair value and selling prices of individual services are broadly similar.
Gas distribution revenue is recognized when its value can be reliably measured, and is recognized in the income statement in the same period in which the volumes are delivered to customers based on monthly measurements performed.
iii.Unbilled revenue
Unbilled natural gas distribution revenue refers to the portion of gas supplied for which metering and billing to customers have not yet occurred. This amount is estimated by considering the average daily billed volume multiplied by the number of unbilled days and by the consumption behavior in the Company's distribution network during the unbilled period compared to the billed period. In addition, the applicable tariff approved by the regulatory authority is applied to the referred volume.
Actual volume billed may vary from estimates. The Company believes, based on past experience with similar operations, that the estimated amount of unbilled services will not differ significantly from the actual amount.
iv.Concession construction revenue
The construction of the necessary infrastructure for gas distribution is regarded as a construction service provided to the Granting Authority, and revenue is recognized over time using the incurred cost method. The costs are deducted from income when they are incurred.
Advances received are accounted for as contractual liabilities.
v.Services rendered
Revenue is recognized over time as services are provided. The stage of completion to determine the amount of revenue to be recognized is evaluated based on assessments of progress of work performed.
If services under a single contract occur in different periods, consideration is allocated based on their individual sales prices. The individual selling price is determined on the basis of the list prices at which the Company sells the services in separate transactions
vi.Logistics services provided
Revenues from the provision of services are recognized when the entity transfers to the counterpart the significant risks and benefits inherent to the provision of services, when it is probable that the economic benefits associated with the transaction will flow to the Company, as well as when its related value and incurred costs can be reliably measured.
Service prices are fixed based on service orders or contracts. The Company’s revenue is basically comprised of rail freight, road freight, container transport and port elevation services, which is why the above criteria are normally met to the extent that the logistics service is provided.
vii.Lease Revenues
Rental revenue is recognized on a straight-line basis over the term of each contract, to the extent that the contracts transfer to customers the right to use the assets for a period in exchange for consideration to the subsidiary that can be measured reliably.
viii.Sale of properties for investment
Revenue comprises the fair value of the consideration received or receivable for the disposal of investment property in the ordinary course of the subsidiaries’ activities. Revenue is presented net of taxes, returns, allowances and discounts, and in the consolidated financial statements after eliminating sales within the subsidiary. Revenue is recognized when the subsidiary fulfils all the obligations and promises identified in the contract for the transfer of the assets to the customer.
Gross revenue from the sale of products and services
46,069,211
50,141,542
45,298,287
Indirect taxes and other deductions
(7,218,900
(7,793,084
(7,323,932
In the following table, revenue is disaggregated by products and service lines and timing of revenue recognition:
At a point in time
12,844,764
16,186,692
15,737,450
Lubricants, base oil and other
8,812,257
9,424,869
9,285,675
Lease and sale of property
2,194,419
596,632
538,445
24,505,225
27,650,002
26,304,981
Over time
Railroad transportation services
13,053,660
13,251,052
10,379,017
1,494,141
15,923,935
16,362,173
13,224,808
Eliminations
The Company and its subsidiaries account for natural gas distribution concession contracts using the intangible asset model in accordance with IFRIC 12 and IAS 38 and classify the amortization of the concession contract as cost of sales.
Expenses are presented in the statement of profit or loss and other comprehensive income by function. The reconciliation of revenues, costs, and expenses by nature/purpose is as follows:
Raw materials
(6,844,761
(7,134,069
(7,291,453
Commodity cost (natural gas)
(9,798,394
(12,083,199
(11,919,415
Railroad transport and port elevation expenses
(3,260,552
(3,129,514
(2,696,333
Other transport
(506,805
(484,136
(523,747
(3,890,832
(3,868,583
(3,364,943
Personnel expenses
(3,183,083
(3,115,478
(2,893,919
Construction cost
(1,568,285
(1,602,284
(1,494,141
Third-party services expenses
(923,519
(901,372
(952,294
(3,181
(42,815
(37,451
Cost of properties sold
(1,559,250
(1,548,827
(1,101,274
(31,620,878
(34,657,233
(32,428,440
219,305
60,282
43,835
Change in fair value of investment properties (Note 11.5)
2,259,924
Result on disposals and write-offs of fixed and intangible assets
(99,324
141,863
(17,016
Result on sale of investments
32,375
(383,205
Gain previously recognized in other comprehensive income reclassified to profit or loss upon disposal of investment
206,388
Net effect of provisions for legal proceedings, legal claims, recoverables and tax installments
(333,659
(313,876
(204,158
Dividends received from Vale S.A
1,339,340
Realization of deferred income
923,214
Result of commercial operations (i)
664,597
Contractual agreement and others
689,764
(143,221
Reversal of other provisions
291,032
Other income
179,685
168,245
303,825
Net impairment loss (Note 11.6)
Gain from corporate restructuring
168,855
Loss of profits and material damages of fixed assets (ii)
998,794
(148,166
(546,159
(581,366
1,667,519
(1,605,566
(i)
Financial revenues comprises:
•Interest Revenue on invested funds;
•Gains arising from changes in the fair value of financial assets measured at fair value through profit or loss;
•Gains arising from changes in the fair value of pre-existing interests in business combinations;
•Gains on hedging instruments that are recognized in profit or loss;
•Reclassifications to the result of net gains previously recognized in other comprehensive income.
Interest income is recognized in profit or loss using the effective interest rate method.
Financial expenses comprises:
•Expenses related to interest on loans and borrowings;
•Recognition of deductible provisions and deferred charges;
•Losses on the sale of financial assets;
•Losses arising from changes in the fair value of financial assets measured at fair value through profit or loss and contingent consideration;
•Impairment losses on financial assets (excluding accounts receivable);
•Losses on hedging instruments recognized in profit or loss;
•Reclassifications of net losses previously recognized in other comprehensive income.
Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognized in profit or loss using the effective interest method.
Foreign exchange gains and losses arising from financial assets and liabilities are presented on a net basis as financial income or expense, depending on whether variations in the foreign currency result in a positive or negative position.
The details of financial income and expenses are as follows:
(6,441,757
(5,767,426
(4,267,829
2,473,085
(5,795,089
1,921,632
Derivatives and fair value measurement(i)
(4,523,652
3,787,479
(2,684,111
(452,944
(113,136
(64,588
186,681
(19,374
(36,079
(38,773
(8,777,961
(7,924,251
(5,133,669
2,505,285
1,975,811
2,057,369
87,844
(3,147,031
2,593,129
(1,089,662
(6,184,832
(5,948,440
(6,223,331
728,102
464,883
450,478
(14,894
1,777
(517,451
(387,044
(514,236
(647,750
(641,144
(444,850
(50,337
(44,464
(46,212
(470,301
(605,231
(781,087
(88,170
(97,845
(141,873
155,624
(107,747
(380,840
(1,655,731
(133,974
(1,606,589
(2,801,277
(1,673,696
The variation was primarily driven by the depreciation of the U.S. dollar against the Brazilian real - with the average PTAX exchange rate decreasing from R$ 6.19 on December 31, 2024 to R$ 5.50 on December 31, 2025 (11.2% appreciation of the real).
Accounting policy
The cost of defined benefit pension plans and other post-employment and the present value of the pension obligation is determined using actuarial valuations. An actuarial valuation involves the use of various assumptions which may differ from actual results in the future. These include the determination of the discount rate, future salary increases, mortality rates and future pension increases. A defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed by management at each reporting date.
i.Defined Contribution Plans
A defined contribution plan is a post-employment benefit plan in which the Company pays fixed contributions to a separate entity and has no legal or constructive obligation to pay additional amounts. Obligations for contributions to defined contribution plans are recorded as an employee benefit expense in the financial results during the periods in which the related services are rendered by employees. Contributions to a defined contribution plan that are due more than 12 months after the end of the service period are discounted to their present value.
The Company sponsors a defined contribution private pension plan named Plano de Aposentadoria FuturaFlex (for the employees of Compass, Comgás and Commit), managed by FuturaMais – Complementary Pension Fund Entity (Entidade de Previdência Complementar (formerly named RaizPrev – Private Pension Fund Entity (Entidade de Previdência Privada), which merged Futura II – Entidade de Previdência Complementar). The Entity has administrative, asset and financial autonomy, and has as object the management and execution of social security benefit plans, as defined in the Regulation of Benefit Pension Plans.
The Company has no legal or contractual obligations that may generate the need to make additional extraordinary contributions if the plan presents a deficit result.
ii.Variable contribution
A variable contribution plan is also known as a mixed plan that brings together aspects of the BD – defined benefit and the DC – defined contribution.
The Company and its subsidiaries sponsor a supplementary pension plan structured as a Variable Contribution plan, called the Futura II Retirement Plan. Also managed by FuturaMais, it combines the characteristics of Defined Contribution for scheduled benefits (normal and early retirement) and Defined Benefit for risk benefits (sick pay, disability, lump sum payment and survivor's pension).
Compagas offers a mixed-type defined contribution plan, characterized by the accumulation of savings during employees' working lives, which are converted into a lifetime annuity upon retirement.
The main risks of this plan are a longer life expectancy for beneficiaries and higher wage growth compared to those considered in the calculations.
iii.Defined benefit
The defined benefit plan is a plan in which the participants have the due benefit established by means of regulatory provisions. The cost is determined through actuarial evaluations, which are conducted at least annually based on assumptions.
Retirement Plan
The Retirement Plan, administered by Futura – Entidade de Previdência Complementar and sponsored by Cosan Lubricants e Especialidades SA, has been closed and in the process of being phased out since 2011.
According to the regulations, the Company adopts a provision for the present value of benefits, and beneficiaries receive an annuity according to the plan. The main actuarial risks are:
a)Greater survival compared to that specified in the mortality tables;
b)Return on shareholders’ equity lower than the discount rate used in the actuarial assessment , plus the accumulated IGP-DI; and
c)Actual family structure differs from established retirement assumptions.
Health insurance
The Company has defined benefit plans related to medical assistance in the subsidiaries Comgás and Compagas. The Subsidiary Comgás offers the following post-employment health care benefits, granted to former employees and their dependents who retired up to May 31, 2000. After this date, only employees with 20 years contribution to Social Security (Instituto Nacional do Seguro Social), or “INSS,” and 15 years uninterrupted work at the Company up to May 31, 2000, are entitled to this defined benefit plan, provided that, on the date of retirement, they were working at the Company.
Compagas offers the Pró-Saúde Plan for employees and their dependents, with monthly contributions from the sponsor and employees. Beneficiaries on retirement will have the right to remain in the plan for life.
The main risks of this plan are the longer survival of the beneficiaries and the higher cost of medical inflation compared to those considered in the calculations.
The liability recognized on the balance sheet relating to the defined benefit post-employment plan is calculated annually by independent actuaries.
The amount recognized in the balance sheet in respect of post-employment benefit plan liabilities represents the present value of the obligations, less the fair value of the assets, including actuarial gains and losses. Remeasurements of the net obligation, which include actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset cap (if any, excluding interest), are recognized immediately in other comprehensive income (ORA). Net Interest and other expenses related to the defined benefit plan are recognized in profit or loss.
Actuarial losses arising from adjustments basis on experience and changes in actuarial assumptions are recorded directly in shareholders’ equity, as other comprehensive income (ORA), when incurred.
Defined contribution
Futura II
386
Defined benefit
Futura
146,225
141,050
Health plan
389,815
385,272
536,040
526,322
Details of current plans
a) Defined contribution
During the fiscal year ended December 31, 2025, the amount of contributions paid by the Company was R$ 1,323 (R$ 111 as of December 31, 2024 and R$ 103 as of Deceber 31, 2023).
b) Defined benefit
The subsidiary Cosan Lubrificantes e Especialidade (“CLE”) sponsors Futura – Entidade de Previdência Complementar (“Futura”), formerly known as Previd Exxon – Entidade de Previdência Complementar. Futura's main objective is to provide supplementary benefits, within certain limits established in the Retirement Plan regulations. This plan was modified to be closed to new participants and approved by the competent authorities on May 5, 2011. During the fiscal year ended December 31, 2025, contributions totaled R$ 19,240 (R$ 16,252 in the fiscal year ended December 31, 2024). The weighted average duration of the obligation is 7.7 years as of December 31, 2025, and 8.9 years as of December 31, 2024 and 2023. In 2026, CLE expects to make a contribution of R$ 18,624 in relation to its defined benefit plan.
In addition, the indirect subsidiary Compagás performed the actuarial analysis of the defined benefit pension plan, which is in surplus and, therefore, no balances were recorded. The details are below:
Liability at year-end
(46,780
Financial assets at year-end
54,476
Accrued surplus
7,696
Asset limit effect
(7,696
Liability to be recognized
d) Medical plan
Obligations related to post-employment benefit plans, which include medical assistance and retirement incentives, sick pay and disability pension.
The defined benefit pension plan is governed by Brazilian labor laws, which required final salary payments to be adjusted by the consumer price index at the time of payment during retirement. The level of benefits provided depends on the member's length of service and salary at retirement age. During the fiscal year ended December 31, 2025, contributions totaled R$30,891 (R$31,169 in the fiscal year ended December 31, 2024). The weighted average duration of the health plan obligation was 9.9 years (8.9 years as of December 31, 2024) at the indirect subsidiary Comgás and 17.7 years (20.4 years as of 2024) at the indirect subsidiary Compagas. In 2026, subsidiaries expect to make a contribution of R$46,373 to their defined benefit plan.
Breakdown and changes in current plans
The details of the present value of the defined benefit obligation and the fair value of the plan's assets are presented below:
Actuarial obligation at beginning of the year
1,018,300
1,141,841
1,097,982
Current service cost
378
157
9,560
Interest on actuarial obligation
111,130
105,302
107,057
Actuarial (gain) loss arising from financial assumptions
(3,747
(170,791
62,807
Actuarial loss (gain) arising from experience adjustment
(8,188
23,181
(62,889
Actuarial gains arising from demographic assumptions
505
22,116
Benefit payments
(96,934
(91,684
(85,389
Actuarial obligation at the end of the year
1,020,939
Fair value of plan assets at the beginning of the year
(491,978
(524,527
(522,474
Interest income
(51,452
(46,423
(49,720
Return on investments in the year (excluding interest income)
11,730
34,709
2,443
Employer contributions
(50,133
(43,340
(40,278
Benefits paid
96,934
87,603
85,502
Fair value of plan assets at the end of the year
(484,899
Defined benefit liabilities, net
617,314
The total expense recognized in financial results is as follows:
(378
(386
(157
(59,678
(58,879
(57,337
(60,056
(59,265
(57,494
Total amount recognized as other comprehensive income:
Accumulated at the beginning of the year
290,378
180,311
204,788
Actuarial gain (loss) arising from financial assumptions
3,486
168,351
(62,807
Actuarial (loss) gain arising from experience adjustment
8,449
(23,575
62,889
Actuarial loss arising from demographic assumptions
(22,116
(11,730
(34,709
(2,443
Accumulated at the end of the year
290,583
The plan's assets consist of the following:
Fixed income
484,112
491,194
Plan assets consist of financial assets quoted on active markets and are therefore classified as Levels 1 and 2 in the fair value hierarchy. The expected rate of return on plan assets is determined based on market expectations applicable to the period during which the obligation is to be settled at the time the rate is determined.
The following are the primary assumptions used to determine the Company's and its subsidiaries' benefit obligations:
Health insuranceCompagas
Health insuranceComgás
Discount rate
11.07%
7.22% p.a.
7.43% p.a.
7.27% p.a.
12.14% p.a.
Inflation rate
3.50%
3.90% p.a.
4.96% p.a.
4.00% p.a.
4.50% p.a.
Future salary increases
N/A
1.00% p.a.
Morbidity (aging factor)
2.20% p.a.
3.00% p.a.
Future pension increases
Overall mortality (segregated by sex)
AT-2000 (sex-segregated basic)
AT-2000 (10% smoothed)
Disabled mortality
Winklevoss
IAPB-1957
Entry into disability (modified)
TASA 1927
UP-84 Modified
Turnover
1.49% p.a.
1.43% p.a.
0.60 / (length of service + 1)
Retirement age
100% at age 60
Sensitivity analysis
The discount rate is one of the key actuarial assumptions, as it affects the defined benefit obligation. The table below presents the sensitivity of the defined benefit obligation to changes in the discount rate, while keeping the other assumptions constant:
Medical inflation
Increase 0.50%
Reduction0.50%
Increase0.50%
609,697
652,378
611,199
654,754
(16,918
18,410
335
(321
There have been no changes regarding biometric and demographic assumptions compared to previous years and the methods adopted in preparing the sensitivity analysis.
The fair value of share-based compensation benefits, on the grant date, is recognized as a personnel expense, with a corresponding increase in shareholders’ equity, over the period in which employees irrevocably acquire the right to the benefits (vesting period), proportionally to the time elapsed.
The amount recognized as an expense is adjusted to reflect the number of shares for which the service conditions and non-market-based vesting conditions are expected to be met. Thus, the amount finally recognized as an expense is based on the number of shares that actually meet these conditions at the vesting date. For non-vesting share-based payment benefits, the fair value at the grant date already incorporates these characteristics, and there are no subsequent adjustments arising from differences between expected and actually granted benefits.
The fair value of the amount payable to employees for share appreciation rights (stock appreciation rights - "SARs"), when settled in cash, is recognized as an expense, with a corresponding increase in liabilities, over the fiscal year in which employees irrevocably acquire the right to receive them. The liability is revalued at each balance sheet date and at the settlement date, basis on the fair value of the stock appreciation rights. Changes resulting from this revaluation are recognized in profit or loss as personnel expenses.
As of December 31, 2025, the Company has the following share-based payment arrangements:
Programs granted up to December 31, 2024 and still in force
•Granting of shares (settled in shares), without lock-up period, with delivery of shares at the end of the 5-year vesting period, conditional only on maintaining the employment relationship (service condition).
•Granting of shares (settled in shares), without lock-up period, with delivery of shares during or at the end of a 3 to 5years vesting period, subject to:
i.Part of the options for maintaining the employment relationship (service condition); and
ii.Part of achieving each of the metrics that make up the performance goals (performance conditions).
•A share-based compensation plan (cash-settled) in which beneficiaries are allocated a specific number of units referenced to a theoretical share price calculated basis on Cosan's consolidated EBITDA for each year. The units will be paid upfront, subject to the fulfillment of contractual conditions, with a vesting period of 3 to 5 years. Payments occur at the end of each cycle (3 to 5 years after the grant date), basis on the converted reference share value at that time.
Grants made in 2025
In the year ended December 31, 2025, the following share-based payments Program was established:
Program
Conditions for vesting
Invest Cosan 2025
Grant: July 31, 2025.
Cosan Invest 2025 Program, awarded on July 31, 2025. The incentive program is conditional on retention and performance actions. Of the total actions in the program, 50% are related to length of service (service condition) for a period of 3 years. The remaining 50% of the program is related to performance targets, requiring the achievement of specific metrics that can vary from 0% to 150%.
Grant: November 10, 2025.
Cosan Invest Program 2025, awarded on November 10, 2025. The incentive program is conditional upon retention actions. The total number of actions in the program are related to length of service (service condition) for a period of 6 months.
Phantom Shares 2025 Moove Program
The incentive program is conditional upon length of service and tied to the occurrence of a liquidity event defined in the program (performance conditions). The options granted to participants may only be exercised after they become vested options, and the maximum term for exercising the Options will be 6 (six) years from the date of grant.
Invest 2025 Program – Rumo
Grant: October 10, 2025.
Stock option programs, without lock-up, with delivery of shares at the end of the three-year vesting period, conditioned on i) part of the options being contingent upon maintaining the employment relationship (service condition) and ii) part upon achieving each of the metrics that make up the performance targets (performance conditions), with the number of performance options granted varying between 0% and 200% depending on performance.
Phantom shares - Compass
Grant: August 1, 2025.
Phantom share plan that provides for the granting of share appreciation rights (“SARs”). SARs offer the opportunity to receive a cash payment equal to the fair value of Compass common share.
Number of shares
Award Type / Award Date
Life expectancy (months)
Grants under plans
Exercised / Canceled / transferred
Available
Fair value as of grant date - R$
Share grant program
07/31/2020
60
68,972
(68,972
20.93
07/31/2021 - Invest I
36
424,839
(424,839
24.38
09/10/2021 - Invest II
48
5,283,275
(5,283,275
22.24
10/11/2021 - Invest III
806,752
(566,287
240,465
23.20
07/31/2022 - Invest I
846,506
(846,506
18.74
11/22/2022 - Invest Partners
377,173
(192,869
184,304
17.14
01/30/2023 - Invest Partners
12,472,325
(7,864,867
4,607,458
15.26
07/31/2023 - Invest Cosan I - Regular
1,047,845
(478,677
569,168
17.53
12/01/2023 - Invest Cosan III - Associates
546,734
(119,209
427,525
17.68
01/30/2024 - Invest Partners
12
2,322,324
(2,322,324
18.18
07/31/2024 - Program Invest Cosan 2024
1,428,479
(308,634
1,119,845
13.54
07/31/2025 - Program Invest Cosan 2025
2,644,661
(214,838
2,429,823
7.28
11/10/2025 - Program Invest Cosan 2025
2,722,482
30,992,367
(18,691,297
12,301,070
11/20/2024 - Program SOP 2024
72
610,940
(610,940
50.05
11/11/2020
776,142
(776,142
20.01
05/05/2021
1,481,000
(1,481,000
20.84
09/01/2022
1,781,640
(1,781,640
20.36
09/06/2023
1,724,867
(277,097
1,447,770
21.86
08/22/2024
2,433,432
(134,748
2,298,684
23.37
10/01/2025
2,350,620
(9,093
2,341,527
15.74
10,547,701
(4,459,720
6,087,981
Share-based compensation plan (settled in cash)
07/31/2019 - Invest I
132,670
(132,670
50.79
07/31/2020 - Invest II
106,952
(106,952
61.89
07/31/2021 - Invest III
80,729
(80,729
102.73
07/31/2022 - Invest IV
77,967
(77,967
135.05
07/31/2023 - Invest V
82,204
(7,228
74,976
150.98
07/31/2024 - Invest VI
61,372
(2,178
59,194
234.43
07/31/2025 - Invest VII
61,666
(220
61,446
283.02
08/01/2023
331,211
(67,962
263,249
34.12
08/01/2024
376,495
(24,579
351,916
42.21
11/01/2024
33
16,969
(4,112
12,857
08/01/2025
424,508
(12,901
411,607
41.92
1,752,743
(517,498
1,235,245
43,903,751
(24,279,455
19,624,296
a) Reconciliation of outstanding share options
The change in number of share is as follows:
31,557,498
Granted
6,856,907
Addition of shares
605,005
Exercised/cancels/other
(22,394,499
16,624,911
8,203,937
Addition of shares (i)
5,377
(5,209,929
b) Fair value measurement
The weighted average fair value of the programs granted during December 31, 2025 and 2024 and the main assumptions used in applying the Black-Scholes and Binominal model were as follows:
Average market price on the grant date
Interest rate
Volatility
12/31/2025
6.14
12/31/2024
45.29
Rumo(i)
10.41%
25.84%
Moove(ii)
4.05%
42.85%
66.97
Volatility was determined using the following methodology:
(i) For publicly traded shares, based on the historical volatility of the share price over the thirty days preceding the grant date.
(ii)For non-publicly traded shares, such as those of Moove, based on the historical volatility of the controlling company’s share price over a period proportional to the term of the plan.
c) Expenses recognized in profit or loss
Share-based compensation expenses included in the statement of profit or loss for the year ended December 31, 2025, were R$ 71,725 (R$ 65,901 as of December 31, 2024).
The subsequent events below are detailed in Note 2, as they constitute developments of events initiated in the fiscal year 2025:
• Settlement of the Vale call spread (Note 2.1.2);
• Insurance proceeds received by Moove (Note 2.1.3);
• Conversion of preferred shares by Bradesco (Note 2.1.10);
• Raízen debt restructuring (Note 2.1.11); and
• Early redemption of debentures and Senior Notes (Note 2.2.4)
Settlement of TRS on treasury shares
On January 15, 2026, the Company settled the derivative instrument (TRS) with Banco Santander, referenced to treasury shares. The transaction resulted in the acquisition of 52,611,312 shares (ticker: CSAN3) for the amount of R$ 270,422. On the date of authorization of these financial statements, the Company held no other derivative contracts linked to treasury shares.
Coordinated conflict between the United States and Israel against Iran
After the closing date of the fiscal year ended December 31, 2025, in February 2026, an escalation of geopolitical tensions occurred between the United States and Iran, with potential impact on global energy and logistics markets.
Management diligently assessed the risks associated with this event and concluded that, up to the date of authorization of these financial statements, no material impacts were identified on:
• Cosan’s consolidated operations in Brazil and in the other countries where it operates;
• The consolidated financial position (including debt, liquidity, and foreign exchange exposure);
• Commodity prices relevant to the Company, whose observed fluctuations did not materially impact these financial statements.
The Company maintains continuous monitoring of geopolitical developments and their effects on global energy and logistics supply chains. Any future material impacts will be immediately disclosed to the market.
Initial Public Offering (IPO)
On March 5, 2026, Cosan S.A. informed the market that its subsidiary Compass filed the application for registration with the CVM to conduct an initial public offering (IPO) in Brazil. The proposed transaction consists of a secondary offering of common shares, with no issuance of new shares, with the proceeds to be fully allocated to the selling shareholders. Concurrently, Compass requested the admission of its shares to the special listing segment Novo Mercado of B3, subject to applicable regulatory approvals. The terms and conditions of the offering, including the volume of shares and price range, are yet to be defined and depend, among other factors, on approvals by the competent regulatory authorities and the market conditions prevailing at the time of the transaction.
The principal financing activities undertaken by the Company and its subsidiaries during 2026, through the date of this annual report, are described below:
26 New accounting standards
The rules and amendments that came into effect for the fiscal year beginning on or after January 1, 2025, did not have a material impact on the Company's financial statements. The Company has not preemptively adopted any other rule, interpretation, or amendment that has been issued but is not yet in effect.
26.2 New standards and interpretations not yet in force
The new and amended standards and interpretations issued but not yet in effect as of the date of issuance of the Company's financial statements are described below, except for those which, in Management's assessment, do not have the potential to affect the financial statements. The Company intends to adopt these new and amended standards and interpretations, if applicable, when they become effective.
Amendments to IFRS 9 and IFRS 7 – Classification and Measurement of Financial Instruments
On May 30, 2024, the IASB issued amendments to IFRS 9 – Financial Instruments and IFRS 7 – Financial Instruments: Disclosures to address recent practical issues, improve understanding, and introduce new requirements applicable to companies in general, not only financial institutions.
IFRS 18 - Presentation and disclosure in financial statements
In April 2024, the IASB issued IFRS 18, which replaces IAS 1. IFRS 18 establishes new requirements for the presentation of the income statement, including specific totals and subtotals. Furthermore, entities must classify all income and expenses into one of the following five categories: operating, investing, financing, income taxes, and discontinued operations, with the first three categories being new.
The standard also requires the disclosure of performance measures defined by management, subtotals of revenues and expenses, and imposes new requirements for the aggregation and disaggregation of financial information, basis on the "functions" identified in the primary financial statements and accompanying notes.
In addition, some specific changes were made to IAS 7, such as modifying the starting point for determining cash flows from operations using the indirect method, which changes from "profit or loss for the period" to "operating profit or loss," and removing the option to classify dividend and interest cash flows.
The changes to IFRS 18 will take effect for reporting periods beginning on or after January 1, 2027, and will be applied retrospectively. The Company is currently working to identify all the impacts these changes will have on its financial statements and related notes to comply with the new requirement within the established timeframe.