VALE · Vale S.A.

Vale’s Q1 2026 performance reflects robust operational execution amid a favorable commodity price environment. Proforma EBITDA grew 21% year-on-year to $3.9 billion, primarily driven by higher realized prices — iron ore fines at $95.8/t (+5.5% y/y), copper at $13,143/t (+48% y/y), and nickel at $17,015/t (+6% y/y) — alongside volume gains of +3 Mt (iron ore), +9 kt (copper), and +6 kt (nickel). These gains were partially offset by BRL appreciation, which raised iron ore C1 cash cost by 12% y/y to $23.6/t, and higher operating expenses. Free cash flow rose 61% y/y to $813 million, supported by stronger EBITDA and lower tax payments ($321 million vs. $596 million in Q1 2025), though dampened by a $863 million negative working capital swing — attributed to seasonal profit-sharing disbursements, higher inventories, and elevated accounts receivable from end-of-quarter copper sales. Capital expenditures totaled $1.1 billion, consistent with full-year guidance of $5.4–5.7 billion. The $2.2 billion q/q increase in expanded net debt reflects $2.7 billion in dividends and interest on capital, partially offset by free cash flow generation. Strategically, Vale advanced key growth projects — Serra Sul +20 at 86% physical progress and Compact Crushing at 91% completion — and finalized a Thompson operations consortium, retaining an 18.9% stake while securing long-term sustainability funding and nickel concentrate offtake. Management reaffirmed confidence in sustained returns, citing disciplined capital allocation, decarbonization initiatives (e.g., ethanol-powered Guaibamax vessels), and continued tailings dam safety progress — with Maravilhas II and North Laranjeiras dams lifted from emergency status, contributing to an 80% reduction in such structures since 2020.