Brazil's PagBank posts 33% increase in first-quarter recurring net profit (updated)

PagSeguro Digital

23/05/2024 22:11

(Adds context, details and quotes from executives in paragraphs
3-9)
    By Andre Romani
       SAO PAULO, May 23 (Reuters) - Brazilian payment firm
PagBank  PAGS.N  reported on Thursday a 33% rise in its first
quarter net recurring profit from a year earlier, as the
company's investments in hiring and marketing brought in more
revenue. 
    PagBank posted a 522-million-real ($101.31 million) net
recurring profit for the quarter ended in March, while analysts
polled by LSEG expected 475.2 million reais.
    Net revenue rose 15% to 4.3 billion reais, also above
estimates of 4 billion reais, with total payment volumes (TPV)
up 27%. 
    Chief Executive Alexandre Magnani told journalists that the
increase in payments came in part due to a string of new hires
from PagBank in recent quarters to its sales team, as well as
boosted marketing expenses. 
    "This investment in marketing and sales staff pushes
expenses a little higher," CFO Artur Schunck said. "But the
increase in TPV offsets it," he added, stressing the firm's
focus on cost discipline.
    Operating expenses, which include personnel, marketing and
advertising, rose almost 21% in the quarter.
    In its financial services business, PagBank's credit
portfolio tallied 2.7 billion reais at the end of March, stable
from a year earlier, but rising some 8% from December.
    The company now expects to resume offering unsecured credit
lines gradually in the second half of the year, according to
executives, after it paused the segment to focus on secured
products such as payroll loans.
    Its delinquency rate declined to 4.5%, from 17.9% a year
earlier and 7.5% in the fourth quarter.
        
  
 ($1 = 5.1527 reais)

 (Reporting by Andre Romani; Editing by Jonathan Oatis and Kylie
Madry)
 ((Andre.Romani@thomsonreuters.com; 11 991314109;11 56447500;))