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-PagBank records its highest recurring net income in 1Q24, reaching BRL 522 million – an increase of +33% in the annual comparison
TPV reached BRL 112 billion (+27% year-on-year), more than double the industry growth and BRL 31 billion in deposits, strengthening the balance sheet for the expansion of the anticipation of accounts receivable and the granting of credit.
SÃO PAULO, May 25, 2024 /PRNewswire/ — PagBank (NYSE: PAGS), a complete digital bank in financial services and payments solution and one of the largest digital banks in Brazil, announces its results for the first quarter of 2024 (1Q24). Major highlights of the period include a record recurring net profit of BRL 522 million (+33% year-on-year), while net accounting profit reached BRL 483 million (+31% year-on-year).
Alexandre MagnaniCEO of PagBank, highlights the continuity of the good results presented in recent quarters, highlighting the significant gain in market share in payments (acquisitions), balancing growth with profitability, while the Company consolidates itself among the largest financial institutions in Brazil in number of clients:
“We have more than 31 million clients and our execution has been consistent. We have consolidated our value proposition for micro, small and medium-sized businesses, facilitating the financial lives of people and companies. At the same time, we have captured opportunities for client-consumers that have no relation to payment machines through payroll credits, our extensive investment platform and the offer of a complete bank“said the CEO of PagBank.
In acquisitions, the POS recorded was 112 billionBRL (+27% year-on-year), growing in all segments (MSMEs and Large Companies, E-commerce and Cross-border Businesses1). In digital banking, PagBank reached 66 billion BRL in Cash-In (+48% YoY), a metric that represents the financial volume received from other financial institutions in PagBank accounts, excluding acquisitions, especially Pix, merchant account products and salary portability.
The significant volumes of POS and Cash-in led to the deposits to record figures of about 31 billion BRL (+64% year-on-year and +11% quarterly) despite the less favorable seasonality of the period, given that, in the first months of the year, clients have larger disbursements to honor the payment of taxes, such as IPTU and IPVA, and school supplies, among other expenses. “We stand out for offering instant settlement to our clients and performing easy operations through Pix, taking advantage of our POS and Cash-In volume in PagBank accounts. This, added to the fact that we have had a banking license since 2019, means that we have the agility of a fintech and low financing costs like a traditional bank,” Magnani stated.
According to Artur Schunck, CFO of PagBank, operational growth does not harm the Company’s capital allocation. On the contrary, the acceleration of revenue growth and discipline in costs and expenses were the main levers of the record result. “The financial margins of the consolidated business were high. Our profit grew more than 30% compared to the first quarter of 2023, even with additional disbursements linked to the new cycle of growth and diversification of the operation, including geographical expansion and marketing actions in the period“Schunck said.
The credit card resumed its growth and reached 2.7 billion (+8% quarterly) at the end of March, focusing on low-risk products such as consigned credit, the anticipation of the year’s withdrawal from the FGTS (Dismissal Compensation Fund) and credit cards with a limit attached to the CDBs of PagBank (a type of fixed income investment). Schunck believes that, despite short-term macroeconomic uncertainties regarding the behavior of interest rates and inflation, the worst is behind us and is confident in the credit strategy:
“We went through the pandemic, the significant period of high interest rates and one of the worst credit cycles in Brazil and yet we have built a solid and diversified balance of our credit portfolio in terms of clients, products and risks. Now, they are opening opportunities to accelerate the granting and gradually expand the offer of credit products starting in the coming months.“said the financial director of PagBank.
Other highlights
Income net in the quarter were 4.3 billion BRL (+15% year-on-year), driven by strong growth in acquisitions, led by MSMEs (micro, small and medium-sized enterprises) and the advancement of large accounts, with an emphasis on online, cross-border and automation, as well as the growth of higher margins in financial services. The number of clients reached the 31.4 millionreinforcing PagBank’s position as one of the largest digital banks in the country.
In the period, PagBank was recognized as the best bank in brazil and received the RA1000 service quality sealboth awarded by the Reclame Aqui ranking and as one of the 50 most valuable brands in the countryaccording to a survey carried out by Kantar BrandZ.
Among the launches of the quarter, the following stand out: PagBankPartnerships, a relationship and integration program with software and commercial automation companies; Business Insurance which offers coverage against fire, electrical damage, theft, theft and natural disasters, among others; and Tap to Pay Online, a new and exclusive technology in Latin America that allows the customer to make online transactions by bringing the credit or debit card close to the mobile phone on electronic commerce platforms. Additionally, PagBank has started offering a 1% cashback on all purchases made with the digital bank’s credit card and new investment options, such as CBD, with a CDI type variation yield of 130%.
“This current moment reminds us a lot of our time between 2018 and 2019, in which we grew quickly and profitably, and launched several products. “We are very optimistic about the coming months and years of the Company.”declared the CEO of PagBank.
Rio Grande do Sul
PagBank has closely monitored the potential impacts of the ongoing climate tragedy in the state of Rio Grande do Sul and the evolution of its operations. The Company’s TPV exposure in the state is similar to the state’s share of the national GDP: around 5%. The Company says it is early to share some figures as consumption in affected regions has decreased due to temporary business closure, while the movement of people to neighboring cities and states may increase consumption in unaffected areas.
“At this time, our focus is on supporting flood victims, especially our professionals working in the state of Rio Grande do Sul, through donations from PagBank and its professionals, in cash and goods, in addition to offering a special support to our affected client ” Magnani said.
See PagBank’s 1Q24 financial results here.
About PagBank PagBank promotes innovative solutions in financial services and payment methods, automating the purchase, sale and transfer process to enhance the businesses of people and companies in a simple and secure way. UOL Group company – Brazilian Internet leader – PagBank acts as issuer and acquirer, offering digital accounts and providing complete solutions for online and in-person payments (via mobile devices and POS).
PagBank It also has a wide variety of payment methods, such as credit and prepaid cards, bank transfers, payments by banknote and account balance, among others. PagBank (PagSeguro Internet Payment Institution SA) is regulated by the Central Bank of Brazil as a payment institution issuing electronic money, issuer of postpaid instruments and acquirer, having partnerships with the main credit card issuers. Its parent company, PagSeguro Digital, is listed in the US (NYSE: PAGS) and is regulated by the Securities and Exchange Commission (SEC). The distribution of investment funds is carried out by BancoSeguro SA, authorized by the Central Bank of Brazil, the Securities and Exchange Commission and affiliated with ANBIMA.
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1 GCECs: The Brazilian acronym for large companies (annual revenue greater than 12 million BRL), e-commerce and cross-border business.
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