In Payments, TPV growth in 4Q23 reached +21%
y/y, more than 2x industry growth;
Digital bank reached 31 million clients,
totaling R$28 billion in
Deposits;
The results consolidate the business expansion
and diversification beyond longtail and POS devices
SÃO
PAULO, Feb. 29,
2024 /PRNewswire/ -- PagBank (NYSE: PAGS),
a complete digital bank in financial services and payments solution
and one of the largest digital banks in the country, announces its
results for the fourth quarter of 2023 (4Q23). Among the main
highlights, the Company posted a record net income (Non-GAAP) of
R$520 million in 4Q23 (+27% y/y and
+18% q/q), concluding 2023 with almost R$1.8
billion for the year (+11% y/y), the highest in the
Company's history. Net income, in GAAP basis, reached R$488 million in the fourth quarter (+20% y/y and
+19% q/q), totaling R$1.65 billion
for the year (+10% y/y).
Alexandre Magnani,
CEO of PagBank, points out the reasons for this performance in net
income, stating the dynamics of revenue recovery, with strong
growth in acquiring (TPV), more than offsetting the effects of the
interchange cap established in April
2023; a reduction in losses and chargeback, with relevant
developments on the security and fraud prevention front;
a decrease in financial expenses in the annual comparison, due to
the lower average cost of funding on the back of
larger share of deposits in the funding strategy and the easing
interest rate cycle; and also the fact that operating expenses
remained controlled, without harming growth
opportunities.
In Payments, the company marked a record TPV of
R$113.7 billion in the last quarter
of last year (+21% y/y and +14% q/q) and R$394 billion throughout 2023 (+11% y/y), with
growth in all segments, including micro-merchants, SMEs and large
accounts.
In digital banking, PAGS reached R$66 billion in cash-in (all
transfers sent from different financial institutions into PagBank
account) in 4Q23 (+48% y/y and +38% q/q) and R$217 billion in the year 2023 (+59 % y/y).
This proves the clients' growing engagement to PagBank's financial
services, by using the features such as Pix, card issuance, credit
origination and bill payments. Consequently, PAGS reached a record
R$27.6 billion in deposits (+33% y/y
and +28% q/q).
"The outstanding numbers show that PagBank is
entering a new growth stage. Our value proposition goes beyond
serving micro-entrepreneurs and offering POS devices. We are an
increasingly solid and active tech company, reaching almost 15% of
the total Brazilian population. Our wide and diverse range of
products and services serve the most diverse audiences, as our
purpose is precisely to make the financial lives of people and
businesses easier in a simple, secure, digital and affordable way,"
the CEO of PagBank states.
The executive also points out that 2023 was
marked by important achievements from PagBank, such as the
attribution of the brAAA rating by S&P Global Ratings, the
completion of the integration of Moip (online payments company
acquired in August 2020), the
strengthening of the Internet Banking interface, facial
authentication for link online payments and the launches
of Tap on Phone in the PagVendas app and
Boleto/Cobrança Pix. In SMBs accounts, initiatives such as
automatic settlement from different acquirers into PagBank account,
multiple users account and Payroll enabling business owners to
transfer paycheck up to 2,000 employees are also highlighted by
Alex as levers for the digital bank's performance last year.
Currently, PagBank has the largest acceptance
network for payment solutions, with 6.5 million active merchants
and entrepreneurs. The Company maintains its focus on balancing
profitable and sustainable growth rather than the overall number of
merchants, looking for expanding client's share of wallet, and
offers, as competitive advantages, zero fees for new merchants,
24/7 instant payment on PagBank accounts, express payment device
delivery, and the best investment options on the market, with CDBs
that yield up to 130% of CDI.
The credit portfolio reached R$2.5 billion, stable in relation to the previous
quarter, with a focus on low-risk and high-commitment products,
such as credit cards, payroll loans and advance FGTS birthday
withdrawals. For Alex, the improvement in the credit cycle in the
coming months will open up opportunities for PagBank to accelerate
credit underwriting and expand the digital bank's product offering.
"Our numbers demonstrate that growth and higher client engagement
can be stimulated by offering credit through low-risk products.
This allows us to be cautious in more critical moments, like what
the sector experienced throughout 2023. However, we understand that
underwriting and expanding credit products is a natural path and
it's within our plans."
Financial highlights
PagBank's balance sheet also highlights net
revenue – which grew again year-on-year – of R$4.3 billion (+10% y/y and +8% q/q) in 4Q23,
accumulating the amount of R$15.9
billion by the end of 2023 (+4% y/y). For Artur Schunck, CFO of PagBank, this performance
was driven by the strong growth in Payments, led by MSMEs, in
addition to the acceleration of volumes processed in large
accounts, with emphasis on online payments and commercial
automations, in addition to higher margin revenues in financial
services .
"As far as operational expenses are concerned, we
spent practically the same amount as in 2022, but we managed to do
much more. We prioritize growth in organic investments, focusing on
simplification and integration, product launches and improvements,
and disciplined capital allocation," Schunck explains.
According to Alex, in order to balance growth and
profitability throughout 2024, PagBank's strategy will continue to
be based on five pillars: profitable growth in payments, with
a sustainable increase in market share in key segments for the
Company; promoting digital banking engagement to diversify revenue
sources and increase revenue per client; development of the
ecosystem that integrates payments, financial services and
value-added services; 360º security, aiming to reduce losses,
increase client security and promote operational efficiency; and
disciplined cost management and capital allocation to improve
profit and cash flow generation.
In 2023, PagBank also published its
third Sustainability Report, including the main highlights and
actions the Company implemented in the previous year. The Company,
which today is a reference among digital banks and fintechs in
Latin America, put into practice
an ambitious plan that is now reflected in the ratings that measure
the maturity stage of companies in ESG, such
as Sustainalytics and CDP. "Currently, our stage
of maturity on several ESG fronts is similar or higher than that of
institutions with decades of work experience. We are focused on
creating value for all stakeholders and our society", highlights
Eric Oliveira, Executive Director of
IR, ESG and Market Intelligence at PagBank.
See PagBank's financial results in 4Q23 by
clicking here.
About PagBank
PagBank promotes innovative solutions in financial
services and payment methods, automating the purchase, sale and
transfer process to boost the business of any person and company,
in a simple and secure way. A company belonging to the UOL Group –
leader of Brazilian internet –PagBank acts as an
issuer, an acquirer, and offers digital accounts, in addition to
providing complete solutions for online and in-person payments (via
mobile devices and POS devices).
PagBank also has a wide variety of
payment methods, such as credit and prepaid cards, as well as bank
transfers, bank slip payments, account balance, among others.
PagBank (PagSeguro Internet Instituição de PayPal S.A) is regulated
by the Central Bank of Brazil as a
payment institution that issues electronic currency, an issuer of
postpaid instruments and an acquirer, having partnerships with the
main card brands. Its parent company, PagSeguro Digital, is
publicly traded in the USA (NYSE:
PAGS) and is regulated by the SEC (Securities and Exchange
Commission). The distribution of investment funds is carried out by
BancoSeguro S.A., authorized by the Central Bank of Brazil, the Securities and Exchange Commission
and affiliated with ANBIMA.
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