Ambipar Emergency Response (AMBI) 424B3Prospectus supplement

Filed Pursuant to Rule 424(b)(3)

Registration No. 333-270493

PROSPECTUS SUPPLEMENT NO. 2

(to Prospectus dated August 25, 2023)

Ambipar Emergency Response

This prospectus supplement updates, amends and supplements the prospectus contained in our Registration Statement on Form F-1 (as supplemented or amended from time to time, the “Prospectus”) (Registration No. 333-270493). 

This prospectus supplement is being filed to update, amend and supplement the information included in the Prospectus with the information contained in our Report on Form 6-K, furnished to the Securities and Exchange Commission (the “SEC”) on October 10, 2023 (the “Form 6-K”). Accordingly, we have attached the Form 6-K to this prospectus supplement.

This prospectus supplement is not complete without the Prospectus. This prospectus supplement should be read in conjunction with the Prospectus, which is to be delivered with this prospectus supplement, and is qualified by reference thereto, except to the extent that the information in this prospectus supplement updates or supersedes the information contained in the Prospectus. Please keep this prospectus supplement with your Prospectus for future reference.

Our Class A ordinary shares, par value $0.0001 (“Class A Ordinary Shares”) and our warrants (“Warrants”) are listed on the NYSE American LLC (the “NYSE American”) under the trading symbols “AMBI” and “AMBI.WS”. On October 9, 2023, the closing price of our Class A Ordinary Shares on the NYSE American was $6.21 per share and the most recent closing price of our Warrants on the NYSE American was $0.54 per warrant.

Investing in our securities involves a high degree of risk. See “Risk Factors” beginning on page 21 of the Prospectus for a discussion of information that should be considered in connection with an investment in our securities.

Neither the U.S. Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or determined if the Prospectus or this prospectus supplement is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus supplement is October 10, 2023. 

UNITED STATES 

SECURITIES AND EXCHANGE COMMISSION 

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER 

PURSUANT TO RULE 13a-16 OR 15d-16 

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of October, 2023

Commission File Number: 001-41638

AMBIPAR EMERGENCY RESPONSE 

(Exact name of registrant as specified in its charter)

Avenida Angélica, nº 2346, 5th Floor 

São Paulo, São Paulo, Brazil, 01228-200 

Tel: +55 (11) 3526-3526 

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F  x             Form 40-F  ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): Yes ¨ No x

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  Yes ¨ No x

EXHIBIT INDEX

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: October 10, 2023

Exhibit 99.1

INDEX

LETTER TO SHAREHOLDERS

To our shareholders

In 2023, Ambipar Response (hereinafter referred to as "Response" or "the Company") proudly completed its listing on the NYSE American, achieving a gross capitalization of US$ 174 million. This listing not only amplifies our visibility but also fortifies our financial position, grants us access to the world's most advanced capital markets, and places us at the forefront of corporate governance standards.

As this letter marks our inaugural results release, we have structured it into three main sections:

1. Historical Overview and Strategy

2. Capital Allocation

3. Final Thoughts

Historical Overview and Strategy

The trajectory of listing Response on the NYSE American dates back to 1995 when Tercio Borlenghi Junior started a small in-house Emergency Response business to protect their own logistics operations from environmental risk when transporting HAZMAT. Fast forward decades, this original family-owned business effectively became a big company, subsidiary of Ambipar Group, listed as a public company.

From those early years, and most prominently from 2010 to current days, Ambipar Response has undergone through incredible transformation. Our Company witnessed a rapid acceleration in our global growth, a solidification of our value proposition, consolidation of its leadership in several markets, and a notable increase in brand awareness.

We expanded and streamlined our operations into four core business units: emergency response, marine response, industrial response, and environmental response. We also established a presence in four key regions, adopting a matrix management approach. Our primary objective is to offer a comprehensive suite of services from these business units in the regions we operate.

Our clientele operates in sectors that are fraught with operational and environmental risks – encompassing manufacturing, chemicals, pulp and paper, mining, and Hazmat logistics. Clients require specialized services providers capable of executing higher risk services – such as tank cleaning, decontamination, decommissioning, environmental consulting, emergency response, confined space cleaning, handling of contaminant materials - that ultimately safeguard their assets, personnel, and the environment.

Our vision for Response is to be the premier global provider of such risk environmental services, delivering a standardized and complete portfolio of services to our clients wherever they may be.

Our business model emphasizes standardization and readiness at scale, built on four pillars:

These pillars underpin our rapid growth while ensuring we maintain the highest quality of service in the field.

Scale is instrumental in achieving optimal returns on investment. It enables us to share assets and personnel across vast geographies, ensuring efficient asset utilization and maximizing the potential of our resources – akin to "squeezing more juice from the same oranges."

Capital Allocation

Our business presents great organic and inorganic investment opportunities.

We are constantly presented with opportunities to deploy capital at attractive returns to invest in service centers, vehicles, vessels, helicopters, equipment, and personnel. Throughout our journey, we’ve also come across acquisitions as a way to accelerate growth, bring great people and services to our Company.

As evidenced by our organic growth, operational margins, and ROIC, our acquisitions have become part of the Ambipar Response ecosystem and consistently added economic value and positioned us to keep on growing profitably. The underlying reason relies, among others, on rebranding acquisitions to Ambipar Response, upgrading assets, training personnel, bundling services and training sales teams enables Response to achieve constantly growing results.

Final Thoughts

Many of the markets we operate in, notably North America, are fragmented and demand standardized, high-quality services to cater to their vast dimensions and extensive industrial and supply chains. We have successfully established leading positions in Brazil and LatAm and intend to replicate our successful playbook in other regions. This presents a timely opportunity.

Our NYSE American listing has endowed us with an additional currency – the AMBI shares – enabling us to pursue strategic acquisitions and attract individuals keen on contributing to the construction of a global leader in environmental risk services.

We extend our heartfelt gratitude for your partnership as an investor and shareholder. Our commitment remains unwavering: to build a reputable, profitable, and purpose-driven company, always prioritizing our mission to protect the environment, businesses, and communities.

As we embark on this new chapter as a publicly-traded company, we are resolute in our commitment to attract shareholders who resonate with our vision and are willing to support us in the long run.

Ambipar Response has 4 businesses units:

For more details, watch the institutional video.

HIGHLIGHTS

* 1Q23 EBITDA and EBITDA margin adjusted to exclude extraordinary expenses and non-cash from NYSE American listing.

GROSS REVENUE

Gross revenue reached R$660 million in 2Q23, 81.8% higher than 2Q22 and up by 5.3% compared to 1Q23.

The organic growth rate, calculated on a "same store sales" ("SSS") basis, that is, the YoY gross revenue variation of companies and operations that have been for 12 months or more in the Ambipar group compared to the same quarter last year. We have historically seen high rates of organic growth.

BRAZIL

LATAM

EUROPE

NORTH AMERICA

NET REVENUE

COST OF PRODUCTS/SERVICES (CASH)

RESPONSE

Costs remained stable as a percentage of revenue when comparing 2Q23 vs. 1Q23, reflecting the company's business mix. There were no highlights in the composition of costs in this quarter. The largest cost components – Personnel, Third Parties, Maintenance, Fuel and Travel – represented more than 85% of total costs.

GROSS PROFIT

Quarterly Gross Profit(R$ million) and Margin (%) 

Gross profit grew over 2Q22. Gross margin for 2Q23 reached 25.8%, a result of 1.0 pp. lower than 2Q22 and up by 1.6 pp. compared to 1Q23. The improvement in gross margin in relation to 1Q23, is due to better performance in Brazil and Canada.

EBITDA

Quarterly EBITDA (R$ million) and Margin (%)

* 1Q23 EBITDA and EBITDA margin adjusted to exclude extraordinary expenses and non-cash from NYSE American listing

EBITDA registered an 82.0% growth in the 2Q23 versus 2Q22. The EBITDA margin in 1Q23 and 2Q23 reflects a mix with more consulting services, structurally with lower margin.

FINANCIAL RESULTS

In 2Q23, Ambipar Response presented a negative net financial result of R$51 million, resulting from the increase in interest rates and the increase in debt. The debt increase was mainly for capex and M&A.

NET INCOME

Ambipar Response registered net income of R$47.1 million in 2Q23, with a net margin of 7.7%.

Compared to the same quarter of the previous year, net income grew by 35%, with a reduction of 2.8 p.p. in net margin. Profit growth derives from the growth in operations, while the drop in margin is explained by the negative financial result and the contribution of business segments and regions to the consolidated result.

The portion of net income allocated to non-controlling shareholders grew in 2Q23, as we made several acquisitions of companies throughout the year of 2022 where founding partners remain in the business as minority shareholders. This way of carrying out acquisitions ensures that we maintain expertise and continuity in the acquired companies, and it is a form of long-term alignment.

CAPITAL STRUCTURE

On June 30, 2023, financial gross debt reached the amount of R$ 1,256.4 million, a reduction of R$ 61.7 million in relation to the balance determined on December 31, 2022, mainly due to the issue of debentures and funding of loans and financing. Considering Related Parties, the total amount of gross debt was R$ 1,863.3 million a reduction of R$ 224.7 million.

Financial Leverage based on Covenants criteria reduced from 1.51x to 0.94x in the comparison between December 2022 and June 2023, due to the cash generation related to the Company's IPO occurred in March. Also in June 2023, considering Related Parties loans, the leverage was reduced from 2.59x to 1.90x.

The debt maturity schedule has its most relevant portion in the year 2027.

*1Q23 net debt non audited by PCAOB standards. Considers Related Parties’ Loans.

ROIC

Return on Invested Capital minus intangible assets (“operating ROIC”) allows for an approximate estimate of the return on investments made in operations.

Return on Invested Capital (“ROIC”), which incorporates intangible assets into the invested capital base, mainly composed of goodwill paid for acquisitions.

M&A investment, at first, presents a lower ROIC, due to goodwill paid on acquisition. Once acquisitions become part of our operations, the expected return on the marginal investment made tends to follow the Operating ROIC, since the invested capital is allocated to the acquiree's operations and does not include goodwill.

In the medium term, therefore, we expect convergence between the company's ROIC and the operational ROIC.

CAPEX

In 2Q23, addition of Fixed Assets was R$41.9 million. In Response, we invested in Latin America in the new training camp in Chile and in the acquisition of equipment to be used in outsourcing contracts.

As for 6M23, Brazil still demanded capex for helicopters, which are typically demanded to fight fires in the rainforest and transport people to remote areas, and we continued investing in vehicles for industrial services and emergency response in North America.

ANNEXES

BALANCE SHEET

BALANCE SHEET (continued)

INCOME STATEMENT

*1Q23 EBITDA and margin excludes extraordinary expenses and non-cash from NYSE American listing.

CASH FLOW