XP Inc. (NASDAQ: XP) (“XP” or the “Company”), a leading
tech-enabled platform and a trusted pioneer in providing low-fee
financial products and services in Brazil, reported today its
financial results for the second quarter of 2024.
Summary
Operating Metrics (unaudited)
2Q24
2Q23
YoY
1Q24
QoQ
Total Client Assets (in R$
bn)
1,167
1,024
14%
1,141
2%
Total Net Inflow (in R$ bn)
32
22
44%
15
119%
Annualized Retail Take Rate
1.29%
1.30%
-1 bps
1.24%
5 bps
Active Clients (in '000s)
4,626
4,013
15%
4,587
1%
Headcount (EoP)
6,834
6,002
14%
6,579
4%
Total Advisors (in '000s)
18.3
16.5
11%
17.7
3%
Retail DATs (in mn)
2.4
2.2
10%
2.2
12%
Retirement Plans Client Assets
(in R$ bn)
75
64
17%
73
3%
Cards TPV (in R$ bn)
11.5
9.7
19%
11.3
2%
Credit Portfolio (in R$ bn)
19.3
17.9
8%
22.5
-14%
Gross Written Premiums (in R$
mn)
307
202
52%
229
34%
Financial Metrics (in R$ mn)
2Q24
2Q23
YoY
1Q24
QoQ
Gross revenue
4,503
3,728
21%
4,270
5%
Retail
3,294
2,892
14%
3,131
5%
Institutional
346
385
-10%
354
-2%
Corporate & Issuer
Services
629
283
122%
509
24%
Other
233
167
39%
276
-16%
Net Revenue
4,219
3,549
19%
4,053
4%
Gross Profit
2,940
2,402
22%
2,737
7%
Gross Margin
69.7%
67.7%
201 bps
67.5%
214 bps
EBT
1,384
968
43%
1,088
27%
EBT Margin
32.8%
27.3%
552 bps
26.9%
594 bps
Net Income
1,118
977
14%
1,030
9%
Net Margin
26.5%
27.5%
-103 bps
25.4%
109 bps
Basic EPS (in R$)
2.05
1.85
11%
1.88
9%
Diluted EPS (in R$)
2.03
1.83
10%
1.85
9%
ROAE¹
22.1%
22.0%
13 bps
20.7%
149 bps
ROTE2
27.2%
24.1%
315 bps
25.4%
181 bps
____________________
1 – Annualized Return on Average
Equity.
2 – Annualized Return on Average Tangible
Equity. Tangible Equity excludes Intangibles and Goodwill
Operating KPIs
1. INVESTMENTS
Client Assets and Net Inflow (in R$ billion)
Client Assets totaled R$1.2 trillion in 2Q24, up 14% YoY
and 2% QoQ. Year-over-year growth was driven by R$113
billion net inflows and R$30 billion of market
appreciation.
In 2Q24, Net Inflow was R$32 billion, and Retail Net
Inflow was R$24 billion, 83% higher QoQ.
Active Clients (in ‘000s)
Active clients grew 15% YoY and 1% QoQ, totaling 4.6
million in 2Q24.
Total Advisors (in ‘000s)
Total Advisors connected to XP, includes (1) IFAs, (2) XP
employees who offer advisory services, (3) Registered Investment
Advisors, consultants and wealth managers, among others. As of
2Q24, we had 18.3 thousand Total Advisors, an increase of 11%
YoY.
Retail Daily Average Trades (in million)
Retail DATs totaled 2.4 million in 2Q24, up 10% YoY and
12% QoQ.
NPS
Our NPS, a widely known survey methodology used to measure
customer satisfaction, was 71 in 2Q24. Maintaining a high
NPS score remains a priority for XP since our business model is
built around client experience. The NPS calculation as of a given
date reflects the average scores in the prior six months.
2. RETIREMENT PLANS
Retirement Plans Client Assets (in R$ billion)
As per public data published by Susep, XPV&P’s Market Share
went up to 4.3% and individual’s market share (PGBL and
VGBL) to 4.9%. Total Client Assets were R$75 billion in
2Q24, up 17% YoY. Assets from XPV&P, our proprietary insurer,
grew 20% YoY, reaching R$61 billion.
3. CARDS
Cards TPV (in R$ billion)
In 2Q24, Total TPV was R$11.5 billion, a 19% growth YoY,
and 2% increase QoQ.
Active Cards (in ‘000s)
Total Active Cards were 1.3 million in 2Q24, a growth of
35% YoY and 4% QoQ, being 1.0 million Credit Cards
and 0.3 million Active Debit Cards.
4. CREDIT3
Credit Portfolio (in R$ billion)
Total Credit Portfolio reached R$19 billion as of 2Q24,
expanding 8% YoY and 14% lower QoQ. Currently, this Credit
Portfolio is 92% collateralized with Investments.
____________________
3 - From 3Q22 onwards, the credit
portfolio is disclosed gross (versus previously net) of loan loss
provisions, also retroactively, not including Intercompany
transactions and Credit Card related loans and receivables
5. INSURANCE
Gross Written Premiums (in R$ million)
Gross written premiums (GWP) refer to the total amount of
premium income that XPs has written or sold during a particular
reporting period before deductions for provisions, reinsurance and
other expenses. This figure represents the total premiums that
customers have agreed to pay for life insurance policies issued by
the company, or sold by the company and issued by third-party
insurers, including both new policies and renewals. It is a crucial
metric for assessing the total business volume of an insurance
company or insurance broker within that period.
In the 2Q24, Gross Written Premiums grew 52% YoY and
34% QoQ.
Discussion of Financial Results
Total Gross Revenue
Gross Revenue was R$4.5 billion in 2Q24, up 5% QoQ and up
21% YoY, primarily driven by growth both in our Retail and
Corporate & Issuer Services revenue year-over-year.
Retail Revenue
(in R$ mn)
2Q24
2Q23
YoY
1Q24
QoQ
Retail Revenue
3,294
2,892
14%
3,131
5%
Equities
1,115
1,064
5%
1,128
-1%
Fixed Income
820
578
42%
704
17%
Funds Platform
357
341
5%
316
13%
Retirement Plans
97
87
12%
95
2%
Cards
313
232
35%
297
6%
Credit
54
44
24%
55
-2%
Insurance
51
36
45%
45
13%
Other Retail
485
511
-5%
490
-1%
Annualized Retail Take Rate
1.29%
1.30%
-1 bps
1.24%
5 bps
Retail revenue was R$3.3 billion in 2Q24, 5% higher QoQ
and 14% YoY. Sequential Retail revenue was driven by a stronger
performance in Fixed Income revenue, which increased 17% QoQ. YoY
growth was also led by Fixed Income, with a 42% revenue growth YoY,
and Cards, with a 35% growth.
Take Rate
Annualized Retail Take Rate was 1.29% in 2Q24, up 5 bps QoQ, and
stable YoY.
Institutional Revenue
Institutional revenue was R$346 million in 2Q24, down 2% QoQ and
10% YoY, mainly impacted by lower market activity by Institutional
Clients in Brazil sequentially.
Corporate & Issuer Services Revenue
Corporate & Issuer Services revenue totaled R$629 million in
2Q24, up 24% QoQ and up 122% YoY, reinforcing our strategy to
diversify our revenue stream through our Wholesale Bank, also
demonstrating XP is well positioned to continue benefiting from DCM
activity in Brazil.
Other Revenue
Other revenue was R$233 million in 2Q24, down 16% QoQ and up 39%
YoY.
Costs of Goods Sold and Gross Margin
Gross Margin was 69.7% in 2Q24 versus 67.7% in 2Q23 and 67.5% in
1Q24. Sequential increase in Gross Margin was mainly related to
revenue mix between products and channels in the quarter.
SG&A Expenses4
(in R$ mn)
2Q24
2Q23
YoY
1Q24
QoQ
Total SG&A
(1,420)
(1,246)
14%
(1,416)
0%
People
(978)
(899)
9%
(1,007)
-3%
Salary and Taxes
(399)
(344)
16%
(432)
-8%
Bonuses
(446)
(428)
4%
(410)
9%
Share Based Compensation
(133)
(127)
5%
(164)
-19%
Non-people
(442)
(347)
27%
(410)
8%
LTM Compensation Ratio5
24.6%
26.8%
-212 bps
25.2%
-55 bps
LTM Efficiency Ratio6
36.1%
38.3%
-226 bps
36.5%
-44 bps
Headcount (EoP)
6,834
6,002
14%
6,579
4%
SG&A4 expenses totaled R$1.4 billion in 2Q24, stable
QoQ and up 14% YoY.
Our last twelve months (LTM) compensation ratio5 in 2Q24 was
24.6%, an improvement from 26.8% in 2Q23 and from the 25.2%
in 1Q24. Also, our LTM efficiency ratio6 reached 36.1% in
2Q24, the lowest level since our IPO, reinforcing once again our
focus on cost discipline and efficient expenses management.
____________________
4 - Total SG&A and non-people SG&A
exclude revenue from incentives from Tesouro Direto, B3.
5 - Compensation ratio is calculated as
People SG&A (Salary and Taxes, Bonuses and Share Based
Compensation) divided by Net Revenue.
6 - Efficiency ratio is calculated as
SG&A ex-revenue from incentives from Tesouro Direto, B3, and
others divided by Net Revenue.
Earnings Before Taxes
EBT was R$1,384 million in 2Q24, a record-high, up 27%
QoQ and up 43% YoY. EBT Margin was 32.8% up 594 bps QoQ and
552 bps YoY.
Net Income and EPS
In 2Q24, Net Income was R$1.1 billion, also a record
number, up 9% QoQ and up 14% YoY. Basic EPS was R$2.05, up 9%
QoQ and up 11% YoY. Fully diluted EPS was R$2.03 for the quarter,
9% higher QoQ and 10% higher YoY.
ROTE7 and ROAE8
We now present Return on Tangible Equity, which excludes
Intangibles and Goodwill. We believe this metric allows a more
meaningful comparison with our peers.
In 2Q24, ROTE7 was 27.2%, up 181 bps QoQ and up 315 bps
YoY. Our ROAE8 in 2Q24 was 22.1%, up 149 bps QoQ and up 13 bps
YoY.
____________________
7 – Annualized Return on Tangible Common
Equity, calculated as Annualized Net Income over Tangible Common
Equity, which excludes Intangibles and Goodwill, net of deferred
taxes.
8 – Annualized Return on Average
Equity.
Other Information
Webcast and Conference Call Information
The Company will host a webcast to discuss its fourth quarter
financial results on Tuesday, August 13th, 2024, at 5:00 pm ET
(6:00 pm BRT). To participate in the earnings webcast please
subscribe at 2Q24 Earnings Web Meeting. The replay will be
available on XP’s investor relations website at
https://investors.xpinc.com/
Important Disclosure
In reviewing the information contained in this release, you are
agreeing to abide by the terms of this disclaimer. This information
is being made available to each recipient solely for its
information and is subject to amendment. This release is prepared
by XP Inc. (the “Company,” “we” or “our”), is solely for
informational purposes. This release does not constitute a
prospectus and does not constitute an offer to sell or the
solicitation of an offer to buy any securities. In addition, this
document and any materials distributed in connection with this
release are not directed to, or intended for distribution to or use
by, any person or entity that is a citizen or resident or located
in any locality, state, country or other jurisdiction where such
distribution, publication, availability or use would be contrary to
law or regulation or which would require any registration or
licensing within such jurisdiction.
This release was prepared by the Company. Neither the Company
nor any of its affiliates, officers, employees or agents, make any
representation or warranty, express or implied, in relation to the
fairness, reasonableness, adequacy, accuracy or completeness of the
information, statements or opinions, whichever their source,
contained in this release or any oral information provided in
connection herewith, or any data it generates and accept no
responsibility, obligation or liability (whether direct or
indirect, in contract, tort or otherwise) in relation to any of
such information. The information and opinions contained in this
release are provided as at the date of this release, are subject to
change without notice and do not purport to contain all information
that may be required to evaluate the Company. The information in
this release is in draft form and has not been independently
verified. The Company and its affiliates, officers, employees and
agents expressly disclaim any and all liability which may be based
on this release and any errors therein or omissions therefrom.
Neither the Company nor any of its affiliates, officers, employees
or agents makes any representation or warranty, express or implied,
as to the achievement or reasonableness of future projections,
management targets, estimates, prospects or returns, if any.
The information contained in this release does not purport to be
comprehensive and has not been subject to any independent audit or
review. Certain of the financial information as of and for the
periods ended of December 31, 2021 and December 31, 2020, 2019,
2018 and 2017 has been derived from audited financial statements
and all other financial information has been derived from unaudited
interim financial statements. A significant portion of the
information contained in this release is based on estimates or
expectations of the Company, and there can be no assurance that
these estimates or expectations are or will prove to be accurate.
The Company’s internal estimates have not been verified by an
external expert, and the Company cannot guarantee that a third
party using different methods to assemble, analyze or compute
market information and data would obtain or generate the same
results.
Statements in the release, including those regarding the
possible or assumed future or other performance of the Company or
its industry or other trend projections, constitute forward-looking
statements. These statements are generally identified by the use of
words such as “anticipate,” “believe,” “could,” “expect,” “should,”
“plan,” “intend,” “estimate” and “potential,” among others. By
their nature, forward-looking statements are necessarily subject to
a high degree of uncertainty and involve known and unknown risks,
uncertainties, assumptions and other factors because they relate to
events and depend on circumstances that will occur in the future
whether or not outside the control of the Company. Such factors may
cause actual results, performance or developments to differ
materially from those expressed or implied by such forward-looking
statements and there can be no assurance that such forward-looking
statements will prove to be correct. These risks and uncertainties
include factors relating to: (1) general economic, financial,
political, demographic and business conditions in Brazil, as well
as any other countries we may serve in the future and their impact
on our business; (2) fluctuations in interest, inflation and
exchange rates in Brazil and any other countries we may serve in
the future; (3) competition in the financial services industry; (4)
our ability to implement our business strategy; (5) our ability to
adapt to the rapid pace of technological changes in the financial
services industry; (6) the reliability, performance, functionality
and quality of our products and services and the investment
performance of investment funds managed by third parties or by our
asset managers; (7) the availability of government authorizations
on terms and conditions and within periods acceptable to us; (8)
our ability to continue attracting and retaining new
appropriately-skilled employees; (9) our capitalization and level
of indebtedness; (10) the interests of our controlling
shareholders; (11) changes in government regulations applicable to
the financial services industry in Brazil and elsewhere; (12) our
ability to compete and conduct our business in the future; (13) the
success of operating initiatives, including advertising and
promotional efforts and new product, service and concept
development by us and our competitors; (14) changes in consumer
demands regarding financial products, customer experience related
to investments and technological advances, and our ability to
innovate to respond to such changes; (15) changes in labor,
distribution and other operating costs; (16) our compliance with,
and changes to, government laws, regulations and tax matters that
currently apply to us; (17) other factors that may affect our
financial condition, liquidity and results of operations.
Accordingly, you should not place undue reliance on forward-looking
statements. The forward-looking statements included herein speak
only as at the date of this release and the Company does not
undertake any obligation to update these forward-looking
statements. Past performance does not guarantee or predict future
performance. Moreover, the Company and its affiliates, officers,
employees and agents do not undertake any obligation to review,
update or confirm expectations or estimates or to release any
revisions to any forward-looking statements to reflect events that
occur or circumstances that arise in relation to the content of the
release. You are cautioned not to unduly rely on such
forward-looking statements when evaluating the information
presented and we do not intend to update any of these
forward-looking statements.
Market data and industry information used throughout this
release are based on management’s knowledge of the industry and the
good faith estimates of management. The Company also relied, to the
extent available, upon management’s review of industry surveys and
publications and other publicly available information prepared by a
number of third-party sources. All of the market data and industry
information used in this release involves a number of assumptions
and limitations, and you are cautioned not to give undue weight to
such estimates. Although the Company believes that these sources
are reliable, there can be no assurance as to the accuracy or
completeness of this information, and the Company has not
independently verified this information.
The contents hereof should not be construed as investment,
legal, tax or other advice and you should consult your own advisers
as to legal, business, tax and other related matters concerning an
investment in the Company. The Company is not acting on your behalf
and does not regard you as a customer or a client. It will not be
responsible to you for providing protections afforded to clients or
for advising you on the relevant transaction.
This release includes our Float, Adjusted Gross Financial
Assets, Net Asset Value, and Adjustments to Reported Net Income,
which are non-GAAP financial information. We believe that such
information is meaningful and useful in understanding the
activities and business metrics of the Company’s operations. We
also believe that these non-GAAP financial measures reflect an
additional way of viewing aspects of the Company’s business that,
when viewed with our International Financial Reporting Standards
(“IFRS”) results, as issued by the International Accounting
Standards Board, provide a more complete understanding of factors
and trends affecting the Company’s business. Further, investors
regularly rely on non-GAAP financial measures to assess operating
performance and such measures may highlight trends in the Company’s
business that may not otherwise be apparent when relying on
financial measures calculated in accordance with IFRS. We also
believe that certain non-GAAP financial measures are frequently
used by securities analysts, investors and other interested parties
in the evaluation of public companies in the Company’s industry,
many of which present these measures when reporting their results.
The non-GAAP financial information is presented for informational
purposes and to enhance understanding of the IFRS financial
statements. The non-GAAP measures should be considered in addition
to results prepared in accordance with IFRS, but not as a
substitute for, or superior to, IFRS results. As other companies
may determine or calculate this non-GAAP financial information
differently, the usefulness of these measures for comparative
purposes is limited. A reconciliation of such non-GAAP financial
measures to the nearest GAAP measure is included in this
release.
For purposes of this release:
“Active Clients” means the total number of retail clients served
through our XP Investimentos, Rico, Clear, XP Investments and XP
Private (Europe) brands, with Client Assets above R$100.00 or that
have transacted at least once in the last thirty days. For purposes
of calculating this metric, if a client holds an account in more
than one of the aforementioned entities, such client will be
counted as one “active client” for each such account. For example,
if a client holds an account in each of XP Investimentos and Rico,
such client will count as two “active clients” for purposes of this
metric.
“Client Assets” means the market value of all client assets
invested through XP’s platform and that is related to reported
Retail Revenue, including equities, fixed income securities, mutual
funds (including those managed by XP Gestão de Recursos Ltda., XP
Advisory Gestão de Recursos Ltda. and XP Vista Asset Management
Ltda., as well as by third-party asset managers), pension funds
(including those from XP Vida e Previdência S.A., as well as by
third-party insurance companies), exchange traded funds, COEs
(Structured Notes), REITs, and uninvested cash balances (Float
Balances), among others. Although Client Assets includes custody
from Corporate Clients that generate Retail Revenue, it does not
include custody from institutional clients (asset managers, pension
funds and insurance companies).
Rounding
We have made rounding adjustments to some of the figures
included in this release. Accordingly, numerical figures shown as
totals in some tables may not be an arithmetic aggregation of the
figures that preceded them.
Unaudited Managerial Income Statement (in R$ mn)
Managerial Income Statement
2Q24
2Q23
YoY
1Q24
QoQ
Total Gross Revenue
4,503
3,728
21%
4,270
5%
Retail
3,294
2,892
14%
3,131
5%
Equities
1,115
1,064
5%
1,128
-1%
Fixed Income
820
578
42%
704
17%
Funds Platform
357
341
5%
316
13%
Retirement Plans
97
87
12%
95
2%
Cards
313
232
35%
297
6%
Credit
54
44
24%
55
-2%
Insurance
51
36
45%
45
13%
Other
485
511
-5%
490
-1%
Institutional
346
385
-10%
354
-2%
Corporate & Issuer
Services
629
283
122%
509
24%
Other
233
167
39%
276
-16%
Net Revenue
4,219
3,549
19%
4,053
4%
COGS
(1,279)
(1,147)
12%
(1,316)
-3%
Gross Profit
2,940
2,402
22%
2,737
7%
Gross Margin
69.7%
67.7%
201 bps
67.5%
214 bps
SG&A
(1,328)
(1,246)
7%
(1,406)
-6%
People
(978)
(899)
9%
(1,007)
-3%
Non-People
(350)
(347)
1%
(400)
-12%
D&A
(66)
(51)
29%
(68)
-3%
Interest expense on debt
(204)
(152)
34%
(181)
12%
Share of profit in joint ventures
and associates
41
15
169%
7
-76%
EBT
1,384
968
43%
1,088
27%
EBT Margin
32.8%
27.3%
552 bps
26.9%
594 bps
Tax Expense (Accounting)
(266)
9
n.a.
(59)
351%
Tax expense (Tax Withholding in
Funds)9
(107)
(168)
-36%
(167)
-36%
Effective tax rate
(Normalized)
(25.0%)
(14.0%)
-1105 bps
(18.0%)
-700 bps
Net Income
1,118
977
14%
1,030
9%
Net Margin
26.5%
27.5%
-103 bps
25.4%
109 bps
____________________
9 - Tax adjustments are related to tax
withholding expenses that are recognized net in gross revenue.
Accounting Income Statement (in R$ mn)
Accounting Income Statement
2Q24
2Q23
YoY
1Q24
QoQ
Net revenue from services
rendered
1,949
1,483
31%
1,624
20%
Brokerage commission
541
488
11%
495
9%
Securities placement
686
407
69%
490
40%
Management fees
443
419
6%
411
8%
Insurance brokerage fee
52
42
23%
49
5%
Commission Fees
260
174
49%
208
25%
Other services
148
91
62%
128
16%
Sales Tax and contributions on
Services
(181)
(139)
30%
(157)
15%
Net income from financial
instruments at amortized cost
(244)
618
-140%
227
-208%
Net income from financial
instruments at fair value through profit or loss
2,515
1,448
74%
2,202
14%
Total revenue and
income
4,219
3,549
19%
4,053
4%
Operating costs
(1,236)
(1,092)
13%
(1,219)
1%
Selling expenses
(33)
(45)
-27%
(32)
3%
Administrative expenses
(1,456)
(1,276)
14%
(1,452)
0%
Other operating revenues
(expenses), net
95
24
289%
9
933%
Expected credit losses
(43)
(55)
-22%
(97)
-56%
Interest expense on debt
(204)
(152)
34%
(181)
12%
Share of profit or (loss) in
joint ventures and associates
41
15
169%
7
477%
Income before income
tax
1,384
968
43%
1,088
27%
Income tax expense
(266)
9
-3004%
(59)
n.a.
Net income for the
period
1,118
977
14%
1,030
9%
Balance Sheet (in R$ mn)
Assets
2Q24
1Q24
Cash
5.604
3.939
Financial assets
272.686
257.761
Fair value through profit or
loss
170.035
144.887
Securities
134.481
112.185
Derivative financial
instruments
35.554
32.702
Fair value through other
comprehensive income
38.386
40.310
Securities
38.386
40.310
Evaluated at amortized
cost
64.266
72.564
Securities
3.613
4.459
Securities purchased under
agreements to resell
21.773
30.291
Securities trading and
intermediation
4.440
2.512
Accounts receivable
675
639
Loan Operations
26.321
29.542
Other financial assets
7.445
5.121
Other assets
10.138
9.006
Recoverable taxes
392
437
Rights-of-use assets
390
251
Prepaid expenses
4.432
4.477
Other
4.923
3.842
Deferred tax assets
2.597
2.184
Investments in associates and
joint ventures
3.129
3.115
Property and equipment
416
395
Goodwill & Intangible
assets
2.570
2.523
Total Assets
297.141
278.922
Liabilities
2Q24
1Q24
Financial liabilities
213,285
198,444
Fair value through profit or
loss
49,597
51,917
Securities
14,683
17,528
Derivative financial
instruments
34,913
34,389
Evaluated at amortized
cost
163,688
146,527
Securities sold under repurchase
agreements
53,890
49,054
Securities trading and
intermediation
19,034
16,395
Financing instruments payable
72,397
63,037
Accounts payables
623
954
Borrowings
2,528
2,267
Other financial liabilities
15,216
14,820
Other liabilities
63,693
59,935
Social and statutory
obligations
1,111
625
Taxes and social security
obligations
627
501
Retirement plans liabilities
60,981
58,654
Provisions and contingent
liabilities
129
101
Other
845
53
Deferred tax
liabilities
201
118
Total Liabilities
277,179
258,497
Equity attributable to owners
of the Parent company
19,958
20,421
Issued capital
0
0
Capital reserve
19,402
19,332
Other comprehensive income
(226)
186
Treasury
(1,366)
(127)
Retained earnings
2,147
1,030
Non-controlling
interest
4
4
Total equity
19,962
20,425
Total liabilities and
equity
297,141
278,922
Float, Adjusted Gross Financial Assets and Net Asset Value
(in R$ mn)
We present Adjusted Gross Financial Assets because we believe
this metric captures the liquidity that is, in fact, available to
us, net of the portion of liquidity that is related to our Float
Balance (and therefore attributable to clients). We calculate
Adjusted Gross Financial Assets as the sum of (1) Cash and
Financial Assets (comprised of Cash plus Securities – Fair value
through profit or loss, plus Securities – Fair value through other
comprehensive income, plus Securities – Evaluated at amortized
cost, plus Derivative financial instruments, plus Securities
(purchased under agreements to resell), plus Loans and Foreign
exchange portfolio (assets) less (2) Financial Liabilities
(comprised of the sum of Securities loaned, Derivative financial
instruments, Securities sold under repurchase agreements and
Private pension liabilities), Deposits, Structured Operation
Certificates (COE), Financial Bills, Foreign exchange portfolio
(liabilities), Credit cards operations and (3) less Float
Balance.
It is a measure that we track internally daily, and it more
intuitively reflects the effect of the operational profits we
generate and the variations between working capital assets and
liabilities (cash flows from operating activities), investments in
fixed and intangible assets and investments in the IFA Network
(cash flows from investing activities) and inflows and outflows
related to equity and debt securities in our capital structure
(cash flows from financing activities). Our management treats all
securities and financial instrument assets, net of financial
instrument liabilities, as balances that compose our total
liquidity, with subline items (such as, for example, “securities at
fair value through profit and loss” and “securities at fair value
through other comprehensive income”) expected to fluctuate
substantially from quarter to quarter as our treasury manages and
allocates our total liquidity to the most suitable financial
instruments.
In order to explain how we measure our cash position or
generation internally, we are introducing the Net Asset Value
concept. Since we are a financial institution, we hold several
types of financial instruments with different characteristics,
hence the definition of net cash that makes more sense from a
business perspective is the Net Asset Value. It is basically the
adjusted gross financial assets net of debt instruments.
Adjusted Gross Financial
Assets
2Q24
1Q24
Assets
277,536
261,880
(+) Cash
5,604
3,939
(+) Securities - Fair value
through profit or loss
134,481
112,185
(+) Securities - Fair value
through OCI
38,386
40,310
(+) Securities - Evaluated at
amortized cost
3,613
4,459
(+) Derivative financial
instruments
35,554
32,702
(+) Securities purchased under
agreements to resell
21,773
30,291
(+) Loans and credit card
operations
26,321
29,542
(+) Foreign exchange
portfolio
3,555
3,335
(+) Energy
4,583
3,624
(+) Central Bank Deposits
3,667
1,494
Liabilities
(242,890)
(227,665)
(-) Securities
(14,683)
(17,528)
(-) Derivative financial
instruments
(34,913)
(34,389)
(-) Securities sold under
repurchase agreements
(53,890)
(49,054)
(-) Retirement Plans
Liabilities
(60,981)
(58,654)
(-) Deposits
(35,771)
(27,657)
(-) Structured Operations
(19,517)
(19,135)
(-) Financial Bills
(11,910)
(10,315)
(-) Foreign exchange
portfolio
(3,871)
(3,675)
(-) Credit card operations
(7,105)
(7,044)
(-) Other Funding
(249)
(213)
(-) Float
(14,594)
(13,883)
(=) Adjusted Gross Financial
Assets
20,053
20,332
Net Asset Value
2Q24
1Q24
(=) Adjusted Gross Financial
Assets
20,053
20,332
Gross Debt
(10,918)
(10,960)
(-) Borrowings
(2,528)
(2,267)
(-) Debentures
(1,176)
(2,280)
(-) Structured financing
(3,440)
(2,976)
(-) Bonds
(3,775)
(3,436)
(=) Net Asset Value
9,134
9,372
Float (=net uninvested clients' deposits)
2Q24
1Q24
Assets
(4,440)
(2,512)
(-) Securities trading and
intermediation
(4,440)
(2,512)
Liabilities
19,034
16,395
(+) Securities trading and
intermediation
19,034
16,395
(=) Float
14,594
13,883
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240813429336/en/
Investor Relations Contact ir@xpi.com.br
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