PAX

Business Context and Reporting Period

Patria Investments Limited (Patria) is a global alternative investment firm focused on the middle market, specializing in resilient sectors across Latin America, Europe, and the United States. The company operates as a public holding company incorporated in the Cayman Islands, with its Class A common shares listed on the Nasdaq Global Select Market under the symbol "PAX". This Form 20-F covers the fiscal year ended December 31, 2025. Patria manages assets across six verticals: Global Private Markets Solutions (GPMS), Private Equity, Credit, Real Estate, Infrastructure, and Public Equities.

Key Financial Metrics

Note: FRE and DE are Non-GAAP measures. FRE excludes non-recurring items and share-based compensation to assess recurring profitability. DE assesses the ability to distribute dividends.

Material Changes vs. Prior Period

• Revenue Growth: Net revenue from services increased 2.0% to $381.7 million in 2025, driven by a 13.8% increase in management fees ($326.9 million) due to acquisitions and new capital inflows. This was partially offset by a 50.2% decrease in performance fees to $31.0 million, reflecting the variable nature of these fees and lower realizations compared to 2024.
• Profitability: Net income increased 19.6% to $90.5 million, despite a 38.3% increase in personnel expenses ($154.4 million) driven by acquired businesses. Income tax expense decreased significantly to $1.7 million from $10.3 million in 2024 due to deferred tax adjustments.
• Asset Growth: Total AUM grew 25.6% to $52.6 billion, and FEAUM grew 24.0% to $40.8 billion. Growth was driven by net inflows, positive fund performance, and acquisitions in Real Estate and Credit. The Real Estate vertical saw the most significant FEAUM growth (42.4% increase).
• Debt Profile: The company utilized credit facilities to fund acquisitions, resulting in $174.9 million of outstanding debt at year-end, compared to $228.0 million in 2024. The company maintains a Total Debt to FRE ratio well below its 2.5:1.0 covenant limit.

Guidance, Outlook, and Risks

• Dividend Policy: Patria transitioned to a fixed quarterly dividend policy. In Q4 2025, the Board announced an increase to $0.1625 per share for the 2026 financial year (up from $0.15 in 2025).
• Share Repurchases: The Board approved an additional share buyback program of 3 million shares in Q4 2025, in addition to a previously approved program. The company aims to maintain a share count between 158 and 160 million.
• Strategic Acquisitions (Post-Year-End):
  • Solis Investimentos: Acquired 51% of this Brazilian CLO manager (closed Jan 2026), adding ~$3.1 billion in FEAUM.
  • RBR Gestão: Acquired this Brazilian REIT manager (closed Feb 2026), adding ~$1.3 billion in FEAUM.
  • WP Global Partners: Acquired this U.S. private equity solutions manager (closed April 2026) to expand North American presence.
• Risks: Key risks include geopolitical instability in Latin America (specifically Brazil, Chile, and Venezuela), currency volatility (Brazilian Real and Chilean Peso), and regulatory changes regarding tax and ESG. The company also faces risks related to the potential classification as a Passive Foreign Investment Company (PFIC) for U.S. tax purposes.

Investor Verification Checklist

• Non-GAAP Reconciliations: Verify the reconciliation of Fee Related Earnings (FRE) and Distributable Earnings (DE) to Net Income to understand the impact of non-cash items and acquisition-related costs.
• Performance Fee Volatility: Assess the sustainability of revenue given the 50% drop in performance fees in 2025 compared to 2024, which are highly dependent on fund realizations and market conditions.
• Acquisition Integration: Monitor the integration and accretion of the post-year-end acquisitions (Solis, RBR, WP) to ensure they meet projected FEAUM and earnings targets.
• Currency Exposure: Review the sensitivity analysis regarding foreign exchange rates, as a significant portion of AUM and revenue is denominated in local Latin American currencies (BRL, CLP, COP).
• Debt Covenants: Confirm continued compliance with the Total Debt to FRE covenant (limit 2.5:1.0) and minimum AUM covenant ($20 billion) as the company leverages debt for growth.