StoneCo Reports First Quarter 2019 Financial Results and Announces Share Repurchase Program
SÃO PAULO,
Final results for the quarter were generally above the preliminary ranges the Company reported on
“These stronger than expected results continue to demonstrate the unique power of the Stone Model and the strong performance of the Company”, said
Announcement of Share Repurchase Program
The Company has also announced today that its Board of Directors has authorized a share repurchase program, under which Stone may repurchase up to
Operating and Financial Highlights
| Total Revenue and Income | Net Addition of Active Clients |
| +86% | 40.6 K |
| Total Revenue and Income was R$535.8 million, an increase of 86.0% year over year. |
Total Active Clients were 309.7 thousand, an increase of 92.7% year-over-year, with a net addition of 40.61 thousand clients compared to 4Q18. |
| Adjusted Net Income | Adjusted Net Margin |
| R$ 186.3 MM | 34.8% |
| Adjusted Net Income was R$186.3 million, an increase of 603.0% year-over year. |
Adjusted Net Income Margin was 34.8%, an increase of 25.6 percentage points year-over-year. |
| Net Income | Net Margin |
| R$ 177.0 MM | 33% |
| Net Income was R$177.0 million, an increase of 617.0% year-over-year. |
Net Income Margin was 33.0%, an increase of 24.5 percentage points year-over-year. |
| Total Payment Volume (TPV) | Take Rate |
| R$ 26.5 B | 1.86% |
| Total Payment Volume was R$26.5 billion, an increase of 60.1% year-over-year. |
Take Rate was 1.86%, an increase of 17 basis points year over year. |
1 Based on 267.9 thousand active clients plus 1.28 thousand clients in pilot offer of
Other Highlights and Comments from Management for 1Q19
- We have seen a continued ramp-up in Stone Hubs from both newer and older vintages, with a lifetime value to cost of acquisition ratio (LTV to CAC) of approximately 10x. Given these encouraging results, we have decided to accelerate our investment in our Stone Hub operations starting in the second quarter of 2019.
- We continue to evolve and diversify our business with new solutions that go beyond payments because we believe the addition of these complementary solutions increases the lifetime value of our clients and reduces churn. We believe the combination of proprietary assets that we have developed (technology, service, distribution channels and a strong ownership culture) puts us in a unique position to become the partner of choice to provide multiple business solutions to SMBs, for example:
- In Software:
We are building a platform that offers different types of software solutions that are integrated with our payments services to help our clients manage their businesses more effectively and sell more efficiently. We believe this integrated approach will increase the lifetime value of our clients and enable us to leverage strategic data that will empower us to provide more financial solutions more proactively and effectively. During this quarter we:
A. Started to roll-out our offering of Equals Raio-X, a software that helps SMBs to reconcile different payment methods and better understand their cash flows. Traction and acceptance from clients have been very positive.
B. Added three additional software solutions to our portfolio, namely 1) Collact, a customer engagement and CRM solution designed to help merchants to sell more and better understand their customers preferences; 2) VHSYS, a self-service and omni-channel point-of-sale and ERP platform focused on serving different types of retail and service businesses; and 3) Tablet Cloud, a white-label point-of-sale and ERP solution, focused on SMBs with simpler needs.
C. Reached more than 32,000 clients using at least one software solution that we provide. We expect that number to grow significantly overtime as we roll out existing software organically and continue to invest in new solutions.
- In Digital Banking:
We made important advancements in our digital banking account pilot, opening thousands of accounts and offering features such as wire transfers, payment of boletos, payment of taxes, among others. Our digital banking platform is a fully API-driven open banking solution that is directly integrated to the Brazilian Payments System (SPB) and free of checking account fees.
- In Credit:
In February of 2019, we launched the pilot of our credit solution to SMBs with a third-party credit provider. We are focused on offering clients a simple, transparent and non-bureaucratic way to access credit. We believe this solution will support our clients when they need funding to grow their business, by allowing them to effortlessly contract, monitor and payback loans, by fully integrating our credit solution within our payments platform. Initial feedback, usage and economics have been very encouraging.
- Other Highlights:
Recruta Stone, the Company’s semiannual recruitment campaign, has attracted nearly 39,000 applicants this quarter, up from nearly 30,000 in the second half of 2018. In addition, Stone was ranked as one of the top 25 companies to work at inBrazil by LinkedIn. We remain committed to hiring and training talented entrepreneurial-minded people, improving the Stone brand as an employer.
Despite the noise generated by competitors’ campaigns, our pricing and business strategy remains unchanged. We continue to monitor competition very closely and some key metrics, like sales productivity, cancellation and renegotiation requests are on track with our internal plans outlined at the beginning of the year.
Operating and Financial Metrics
| Table 1: Operating Metrics | |||
| Operating Metrics | 1Q19 | 1Q18 | Δ |
| TPV (R$ billions) | 26.5 | 16.5 | 60.1% |
| Active Clients (thousands) | 309.7 | 160.7 | 92.7% |
| Quarterly Net Addition of Clients (thousands) | 40.6 | 29.4 | 37.7% |
| Take Rate | 1.86% | 1.68% | 0.17 p.p. |
Total Active Clients were 309.7 thousand in the first quarter of 2019, an increase of 92.7% from 160.7 thousand in the first quarter of 2018. Net Addition of Active Clients in the first quarter were 40.62 thousand compared to 4Q18, accelerating its growth rate versus the previous quarter due to strong sales productivity across the business.
Total Payment Volume (TPV) was
Take Rate in the first quarter of 2019 was 1.86%, up 17 bps versus the first quarter of 2018 due to the higher penetration of SMBs in Stone’s client base.
2 Based on 267.9 thousand active clients plus 1.28 thousand clients in pilot offer of
| Table 2: Statement of Profit or Loss | ||||||
| Statement of Profit or Loss (R$mn) | 1Q19 | % Rev. | 1Q18 | % Rev. | Δ % | p.p. |
| Net revenue from transaction activities and other services | 168.8 | 31.5% | 90.2 | 31.3% | 87.0% | 0.2 p.p. |
| Net revenue from subscription services and equipment rental | 71.2 | 13.3% | 38.5 | 13.4% | 85.1% | (0.1 p.p.) |
| Financial income | 251.4 | 46.9% | 149.5 | 51.9% | 68.1% | (5.0 p.p.) |
| Other financial income | 44.4 | 8.3% | 9.8 | 3.4% | 354.1% | 4.9 p.p. |
| Total revenue and income | 535.8 | 100.0% | 288.0 | 100.0% | 86.0% | 0.0 p.p. |
| Cost of services | (85.4) | (15.9%) | (70.8) | (24.6%) | 20.5% | 8.7 p.p. |
| Administrative expenses | (64.8) | (12.1%) | (58.9) | (20.5%) | 9.9% | 8.4 p.p. |
| Selling expenses | (62.7) | (11.7%) | (37.7) | (13.1%) | 66.5% | 1.4 p.p. |
| Financial expenses, net | (66.6) | (12.4%) | (68.6) | (23.8%) | (2.8%) | 11.4 p.p. |
| Other operating income (expense), net | (11.5) | (2.1%) | (5.1) | (1.8%) | 123.7% | (0.4 p.p.) |
| (Loss) Income from investment in associates | 0.0 | 0.0% | (0.1) | (0.0%) | (100.0%) | 0.0 p.p. |
| Profit before income taxes | 244.8 | 45.7% | 46.8 | 16.3% | 423.0% | 29.4 p.p. |
| Income tax and social contribution | (67.8) | (12.7%) | (22.1) | (7.7%) | 206.5% | (5.0 p.p.) |
| Net income for the period | 177.0 | 33.0% | 24.7 | 8.6% | 617.0% | 24.5 p.p. |
| Adjusted Net Income | 186.3 | 34.8% | 26.5 | 9.2% | 603.0% | 25.6 p.p. |
Total Revenue and Income (see Graph 1)
Total Revenue and Income was
Net Revenue from Transaction Activities and Other Services
Net Revenue from Transaction Activities and Other Services was
Net Revenue from Subscription Services and Equipment Rental
Net Revenue from Subscription Services and Equipment Rental was
Financial Income
Financial Income was
Other Financial Income
Other Financial Income was
Costs and Expenses (see Graph 2)
Stone continues to see strong operating leverage in its business as it further rolls out its hub strategy and dilutes fixed costs related to its platform. In the first quarter of 2019, operating costs and expenses as a percentage of Total Revenue and Income reached 39.7%, down from 58.1% in the first quarter of 2018.
Cost of Services
Cost of Services was
Administrative Expenses
Administrative Expenses were
Selling Expenses
Selling Expenses were
Financial Expenses, Net
Financial Expenses, Net were
Other Operating Expenses, Net
Other Operating Expenses, Net were
Profit Before Income Taxes
Profit Before Income Taxes was
Income Tax and Social Contribution
During the first quarter of 2019, the Company incurred in
Net Income
Net Income for the Period
Net Income was
Adjusted Net Income
| Table 3: Adjusted Net Income Reconciliation | ||||||
| Net Income Bridge (R$mn) | 1Q19 | % Rev. | 1Q18 | % Rev. | Δ % | p.p |
| Net income for the period | 177.0 | 33.0% | 24.7 | 8.6% | 617.0% | 24.5 p.p |
| Share-based compensation expenses. (a) | 10.1 | 1.9% | 0.0 | 0.0% | n.a. | 1.9 p.p. |
| Amortization of fair value adjustment (b) | 3.8 | 0.7% | 2.7 | 1.0% | 37.5% | (0.2 p.p.) |
| Tax effect on adjustments | (4.6) | (0.9%) | (0.9) | (0.3%) | 398.0% | (0.5 p.p.) |
| Adjusted net income | 186.3 | 34.8% | 26.5 | 9.2% | 603.0% | 25.6 p.p. |
(a) Consists of non-cash expenses related to the vesting of one-time pre-IPO grant of share-based compensation.
(b) On intangibles related to acquisitions. Consists of expenses resulting from the amortization of the fair value adjustment onintangible assets and property and equipment as a result of the application of the acquisition method, a significant portion of whichrelate to the EdB acquisition.
In connection with this earnings release, the Company has provided an analysis of Adjusted Net Income which is a non-IFRS measure, which the Company believes is an important metric to evaluate its operating performance.
Adjusted Net Income was
The main factors that contributed to the growth in Adjusted Net Income were: (i) increase in Total Revenue and Income, primarily due to higher TPV and Take Rate by focusing on growing the Company’s base of SMB merchants; (ii) operating leverage in most lines, especially Cost of Services and Administrative Expenses; and (iii) reduced cost of funds, as the Company switches to cheaper funding and increases the use of own cash to fund the prepayment operation.
Cash Flow
Note on the impact of different funding sources in operating and financing cash flows
A natural consequence of TPV growth is the corresponding increase in both Accounts Receivable from Card Issuers and Accounts Payable to Clients. When the Company makes a prepayment to its clients as part of its working capital solutions offering, it derecognizes accounts payable by the corresponding prepaid amount plus fees earned by providing such prepayment service. In order to fund the prepayment operation, the Company principally uses one of the following sources of funding: (i) the sale of its receivables from card issuers to third party banks or financial institutions, (ii) the issuance of senior quotas by FIDCs to institutional investors or (iii) by deploying its own capital from capital contributions or cash flows from operations. These funding options lead to different impacts on the Company’s statement of cash flows and balance sheet:
- Sale of receivables: the true sale of receivables results in the derecognition of Accounts Receivable from Card Issuers. As a result, when a prepayment operation is funded through the true sale of receivables, both Accounts Receivable from Card Issuers and Accounts Payable to Clients are derecognized from the balance sheet in the same amount and the combined effect to the cash flows is a positive operational cash flow equivalent to net fees earned by providing such prepayment service.
- Issuance of senior quotas by FIDCs3: when the Company launches a new FIDC in order to raise capital, the amount raised from senior quota holders less structuring and transaction costs will be recognized on its balance sheet as cash and as a liability to senior quota holders. The Company then transfers its receivables from card issuers from its operating subsidiary to the FIDC and uses the cash to fund the prepayment operations. As a result of consolidating the FIDC in the Company’s financial statements, the Accounts Receivable from Card Issuers held by the FIDC remain on its consolidated balance sheet. These set of transactions generate a positive impact on the Company’s cash flows from financing activities in the amount received by the FIDC from senior quota holders less structuring and transaction costs. However, as Accounts Receivable from Card Issuers remains on the balance sheet but the Accounts Payable to Clients are derecognized, these transactions also cause a negative impact on our cash flow from operations.
- Deploying the Company’s capital: when the Company uses its own capital to fund prepayment operations, it does not sell its receivables from card issuers and they remain on its balance sheet. However, its Accounts Payable to Clients are derecognized, and therefore these transactions cause a negative impact on the Company’s cash flow from operations.
3
Net Cash Used in Operating Activities
Net Cash Used in Operating Activities for 1Q19 was
- Net Income of
R$177.0 million , combined with non-cash expenses consisting primarily of (i) Depreciation and Amortization Expenses ofR$29.7 million ; (ii) Share-based Payment Expenses ofR$8.1 million ; (iii) Fair Value Adjustment to Derivatives ofR$7.6 million and (iv) Allowance for Doubtful Accounts ofR$4.5 million . The total amount of adjustments to Net Income from non-cash items in the three months endedMarch 31, 2019 wasR$45.3 million .
- Net cash from changes in working capital, arising from changes in operating assets and liabilities, totaled an outflow of
R$517.1 million , principally due to:
i. an increase in the balance of Accounts Receivable from Card Issuers which led to negative cash flows ofR$1,174.6 million , a decrease in Other Accounts Payable ofR$26.5 million , Income Tax Paid in the amount ofR$51.5 million and Interest Paid in the amount ofR$20.6 million ;
ii. partially offset by an increase in Accounts Payable to Clients ofR$469.8 million , an increase in Taxes Payable ofR$51.5 million , an increase in Labor andSocial Security balance ofR$21.0 million and a generation of cash from Interest Income Received, Net of Costs in the amount ofR$234.6 million
- The negative cash flow from the increase in Accounts Receivable from Card Issuers is mainly related to: (i) the increase in TPV, which naturally increases the Accounts Receivable from Card Issuers and also the Accounts Payable to Clients and, specially, (ii) the change of funding mix for the prepayment operation by decreasing the amount of receivables sold to financial institutions and increasing the use of own cash to fund the prepayment.
Net Cash Used in Operating Activities for 1Q18 was
- Net Income of
R$24.7 million , combined with non-cash expenses consisting primarily of (i) Other Financial Costs and Foreign Exchange, Net ofR$36.9 million ; (ii) Depreciation and Amortization ofR$17.3 million and (iii) Loss on Disposal of Property, Equipment and Intangible Assets in the amount ofR$9.4 million . The total amount of adjustments to Net Income from non-cash items in the three months endedMarch 31, 2018 wasR$64.8 million .
- Net cash from changes in working capital, arising from changes in operating assets and liabilities, totaled an outflow of
R$324.4 million , mainly due to:
i. An increase in Accounts Receivable from Card Issuers which led to negative cash flows ofR$427.2 million
ii. partially offset by an increase in Accounts Payable to Clients ofR$19.3 million and Interest Income Received, Net of Costs ofR$86.2 million
Adjusted Net Cash Provided by Operating Activities
Due to the nature of the prepayment business and dynamics of sale of receivables in
| Table 4: Adjusted Net Cash Provided by Operating Activities | ||
| Adjusted net cash provided by operating activities (R$mn) | 1Q19 | 1Q18 |
| Net cash used in operating activities | (294.8) | (234.9) |
| (-) Adjustments in Operating Activities: | ||
| Accounts receivable from card issuers | 1,174.6 | 427.2 |
| Accounts payable to clients | (469.8) | (19.3) |
| Interest income received, net of costs | (234.6) | (86.2) |
| (=) Adjusted net cash provided by operating activities | 175.4 | 86.8 |
In 1Q19 Net Cash Used in Operating Activities was
The
4 Each “Accounts Payable to Clients” recognized as a liability in our balance sheet is directly linked to an “Accounts Receivable from Card Issuers” recognized as an asset in our balance sheet. Originally, the Company receives from issuing banks first, and only then pays its clients, thus having no working capital requirement. When a client opts to be paid early (prepayment), the Company has a working capital requirement. However, the Company has the option itself to sell the receivables from card issuers related to those payables in order to meet such working capital requirement. The combined effect to the cash flows is a positive operational cash flow equivalent to net fees earned by providing such prepayment service.
Whenever management opts to fund its prepayment operation with sources other than the sale of its own receivables, this may have an impact in Net Cash Provided by/ (Used in) Operating Activities, as discussed in the section “Note on the impact of different funding sources in operating and financing cash flows” above.
However, management does not see such decision translating itself into higher or lower ability of our business to generate cash operationally.
Net Cash Provided by (Used in) Investing Activities
Net Cash Provided by Investing Activities was
Net Cash Used in Financing Activities
Net Cash Used in Financing Activities was
Adjusted Free Cash Flow
The Company defines Adjusted Free Cash Flow, a non-IFRS metric, as Net Cash Provided by/ (Used in) Operating Activities, reduced by Purchases of Property and Equipment, Purchases and Development of Intangible Assets, less the effects from working capital adjustments related to changes in Accounts Receivable from Card Issuers and Accounts Payable to Clients mentioned in the section “Adjusted Net Cash Provided by / (Used in) Operating Activities” above.
The Company generated
| Table 5: Adjusted Free Cash Flow | ||
| Reconciliation of Adjusted free cash flow (R$mn) | 1Q19 | 1Q18 |
| Net cash used in operating activities | (294.8) | (234.9) |
| (-) Adjustments in Operating Activities: Accounts receivable from card issuers | 1,174.6 | 427.2 |
| Accounts payable to clients | (469.8) | (19.3) |
| Interest income received, net of costs | (234.6) | (86.2) |
| Purchases of property and equipment | (54.6) | (54.8) |
| Purchases and development of intangible assets | (12.0) | (10.7) |
| Adjusted free cash flow (R$mn) | 108.8 | 21.2 |
The main reason for the increase in Adjusted Free Cash Flow in 1Q19 compared to 1Q18 was the improvement in our Adjusted Net Income, from
Adjusted Net Cash
Management assesses net liquidity of the Company by Adjusted Net Cash/(Debt), a non-IFRS metric. It consists of our Cash and Cash Equivalents, plus Short-term Investments and Accounts Receivable from Card Issuers, reduced by Accounts Payable to Clients, Loans and Financing and Obligations to FIDC Senior Quota Holders.
As of
| Table 6: Adjusted Net Cash | ||
| Adjusted Net Cash (R$mn) | 1Q19 | 4Q18 |
| Cash and cash equivalents | 87.0 | 297.9 |
| Short-term investments | 2,660.1 | 2,770.6 |
| Accounts receivable from card issuers | 10,434.2 | 9,244.6 |
| Adjusted Cash | 13,181.2 | 12,313.1 |
| Accounts payable to clients | (5,728.7) | (4,996.1) |
| Loans and financing | (790.6) | (762.5) |
| Obligations to FIDC senior quota holders | (2,108.6) | (2,074.6) |
| Adjusted Debt | (8,628.0) | (7,833.1) |
| Adjusted Net Cash | 4,553.2 | 4,480.0 |
Other Information
Conference Call
Stone will discuss its first quarter financial results during a teleconference today,
9627 or +1 (844) 204 8942 (US), or +55 (11) 3181 8565 (
The call will also be broadcast simultaneously on Stone’s Investor Relations website at https://investors.stone.co/. Following the completion of the call, a recorded replay of the webcast will be available on Stone’s Investor Relations website at https://investors.stone.co/.
About Stone
Stone is a leading provider of financial technology solutions that empower merchants to conduct commerce seamlessly across multiple channels and help them grow their business over time through technology.
Investor Contact
+1 646-277-1200
StoneIR@icrinc.com
A PDF accompanying this announcement is available at:http://ml.globenewswire.com/Resource/Download/d3db14d0-4bce-4e1d-97fc-3a40ad9b256a
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. These statements identify prospective information and may include words such as “believe,” “may,” “will,” “aim,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “forecast,” “plan,” “predict,” “project,” “potential,” “aspiration,” “objectives,” “should,” “purpose,” “belief,” and similar, or variations of, or the negative of such words and expressions, although not all forward-looking statements contain these identifying words.
Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circum- stances that are beyond Stone’s control.
Stone’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to: more intense competition than expected, lower addition of new clients, regulato- ry measures, more investments in our business than expected, among other factors.
About Non-IFRS Financial Measures
To supplement the financial measures presented in this press release and related conference call, presentation, or webcast in accordance with IFRS, Stone also presents the following non-IFRS measures of financial performance: Adjusted Net Income, Adjusted Net Cash Provided by / (Used in) Operating Activities, Adjusted Free Cash Flow and Adjusted Net Cash / (Debt).
A “non-IFRS financial measure” refers to a numerical measure of Stone’s historical or future financial performance or financial position that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with IFRS in Stone’s financial statements. Stone provides certain non-IFRS measures as additional information relating to its operating results as a complement to results provided in accordance with IFRS. The non-IFRS financial information presented herein should be considered in conjunc- tion with, and not as a substitute for or superior to, the financial information presented in accordance with IFRS. There are significant limitations associated with the use of non-IFRS financial measures. Further, these measures may differ from the non-IFRS information, even where similarly titled, used by other companies and therefore should not be used to compare Stone’s performance to that of other companies.
Stone has presented Adjusted Net Income to eliminate the effect of items from Net Income that it does not consider indicative of its core operating performance within the period presented. Stone defines Adjusted Net Income as Net Income (Loss) for the Period, adjusted for (1) non-cash expenses related to the grant of share-based compensation and the fair value (mark-to-market) adjustment for share-based compensation classified as a liability, (2) amortization of intangibles related to acquisitions, (3) one-time impairment charges, (4) one-off gains and (5) tax expense relating to the foregoing adjustments.
Stone has presented Adjusted Free Cash Flow metric, which has limitations as it omits certain components of the overall Cash Flow Statement and does not represent the residual cash flow available for discretionary expenditures. For exam- ple, this metric does not incorporate the portion of payments representing principal reductions of debt or cash payments for business acquisitions. Therefore, the Company believes it is important to view Free Cash Flows measures only as a complement to our entire consolidated Statements of Cash Flows.
Stone has presented Adjusted Net Cash / (Debt) metric in order to adjust its Net Cash / (Debt) by the balances of Accounts Receivable from Card Issuers and Accounts Payable to Clients, since these lines vary according to the Compa- ny’s funding source together with the lines of (i) Cash and Cash Equivalents, (ii) Short-term Investments, and (iii) Debt balances, due to the nature of Stone’s business and prepayment operation.
| Table 7: Unaudited Consolidated Statement of Profit or Loss | ||
| Statement of Profit or Loss (R$mn) | 1Q19 | 1Q18 |
| Net revenue from transaction activities and other services | 168.8 | 90.2 |
| Net revenue from subscription services and equipment rental | 71.2 | 38.5 |
| Financial income | 251.4 | 149.5 |
| Other financial income | 44.4 | 9.8 |
| Total revenue and income | 535.8 | 288.0 |
| Cost of services | (85.4) | (70.8) |
| Administrative expenses | (64.8) | (58.9) |
| Selling expenses | (62.7) | (37.7) |
| Financial expenses, net | (66.6) | (68.6) |
| Other operating income (expense), net | (11.5) | (5.1) |
| (Loss) income from investment in associates | 0.0 | (0.1) |
| Profit before income taxes | 244.8 | 46.8 |
| Income tax and social contribution | (67.8) | (22.1) |
| Net income for the period | 177.0 | 24.7 |
| Table 8: Unaudited Consolidated Balance Sheet Statement | ||||
| Balance Sheet (R$mn) | 31-mar-19 | 31-dec-18 | ||
| Assets | ||||
| Current assets | 13,318.4 | 12,437.8 | ||
| Cash and cash equivalents | 87.0 | 297.9 | ||
| Short-term investments | 2,660.1 | 2,770.6 | ||
| Accounts receivable from card issuers | 10,434.2 | 9,244.6 | ||
| Trade accounts receivable | 47.3 | 44.6 | ||
| Recoverable taxes | 52.0 | 56.9 | ||
| Prepaid expenses | 28.6 | 15.1 | ||
| Derivative financial instruments | 2.8 | 1.2 | ||
| Other accounts receivable | 6.4 | 6.9 | ||
| Non-current assets | 937.8 | 855.4 | ||
| Receivables from related parties | 8.0 | 8.1 | ||
| Deferred income tax assets | 268.3 | 262.7 | ||
| Other accounts receivable | 9.2 | 8.5 | ||
| Investment in associate | 4.3 | 2.2 | ||
| Property and equipment | 335.4 | 266.3 | ||
| Intangible assets | 312.7 | 307.7 | ||
| Total Assets | 14,256.1 | 13,293.2 | ||
| Liabilities and equity Current liabilities | 7,322.6 | 6,054.8 | ||
| Accounts payable to clients | 5,728.7 | 4,996.1 | ||
| Trade accounts payable | 89.9 | 117.8 | ||
| Loans and financing | 768.6 | 761.1 | ||
| Obligations to FIDC senior quota holders | 549.9 | 16.6 | ||
| Labor and social security liabilities | 117.7 | 96.7 | ||
| Taxes payable | 44.3 | 51.6 | ||
| Derivative financial instruments | 9.8 | 0.6 | ||
| Other accounts payable | 13.7 | 14.2 | ||
| Non-current liabilities | 1,663.9 | 2,145.5 | ||
| Loans and financing | 22.0 | 1.4 | ||
| Obligations to FIDC senior quota holders | 1,558.7 | 2,057.9 | ||
| Deferred income tax liabilities | 76.3 | 80.2 | ||
| Provision for contingencies | 2.1 | 1.2 | ||
| Other accounts payable | 4.8 | 4.7 | ||
| Total liabilities | 8,986.5 | 8,200.2 | ||
| Equity attributable to owners of the parent | 5,270.1 | 5,093.3 | ||
| Issued capital | 0.1 | 0.1 | ||
| Capital reserve | 5,360.0 | 5,351.9 | ||
| Other comprehensive income | (64.9) | (56.3) | ||
| Accumulated losses | (25.1) | (202.3) | ||
| Non-controlling interests | (0.4) | (0.3) | ||
| Total equity | 5,269.6 | 5,093.0 | ||
| Total liabilities and equity | 14,256.1 | 13,293.2 | ||
| Table 9: Unaudited Consolidated Statement of Cash Flows | ||
| Statement of Cash Flows (R$mn) | 1Q19 | 1Q18 |
| Net income for the year | 177.0 | 24.7 |
| Adjustments on Net Income: | ||
| Depreciation and amortization | 29.7 | 17.3 |
| Deferred income tax expenses | (5.3) | (4.4) |
| Loss on investment in associates | 0.0 | 0.1 |
| Other financial costs and foreign exchange, net | (1.7) | 36.9 |
| Provision of contingencies | 0.8 | 0.1 |
| Share based payment expense | 8.1 | 0.0 |
| Allowance for doubtful accounts | 4.5 | 5.8 |
| Loss on disposal of property, equipment and intangible assets | 1.4 | 9.4 |
| Onerous contract | 0.0 | (0.4) |
| Fair value adjustment to derivatives | 7.6 | 0.0 |
| Working capital adjustments: | ||
| Accounts receivable from card issuers | (1,174.6) | (427.2) |
| Receivables from related parties | 2.0 | (11.4) |
| Recoverable taxes | (2.4) | (5.3) |
| Prepaid expenses | (13.6) | (4.5) |
| Other accounts receivable | (6.8) | (13.8) |
| Accounts payable to clients | 469.8 | 19.3 |
| Taxes payable | 51.5 | 7.4 |
| Labor and social security liabilities | 21.0 | 17.0 |
| Accounts payable to related parties | 0.0 | 4.0 |
| Provision for contingencies | 0.0 | (0.0) |
| Other accounts payable | (26.5) | 9.1 |
| Interest paid | (20.6) | (0.2) |
| Interest income received, net of costs | 234.6 | 86.2 |
| Income tax paid | (51.5) | (5.0) |
| Net cash used in operating activity | (294.8) | (234.9) |
| Investing activities | ||
| Purchases of property and equipment | (54.6) | (54.8) |
| Purchases and development of intangible assets | (12.0) | (10.7) |
| Proceeds from (acquisition of) short term investments, net | 157.2 | (14.1) |
| Proceeds from the disposal of non-current assets | 0.2 | 3.2 |
| Acquisition of interest in associates | (0.6) | 0.0 |
| Net cash provided by (used in) investing activities | 90.3 | (76.4) |
| Financing activities | ||
| Payment of borrowings | (0.2) | (1.2) |
| Payment of finance leases | (5.9) | (3.7) |
| Capital increase | 0.0 | 3.2 |
| Acquisition of non-controlling interests | (0.2) | (5.8) |
| Net cash used in financing activities | (6.4) | (7.5) |
| Effect of foreign exchange on cash and cash equivalents | (0.0) | 2.1 |
| Change in cash and cash equivalents | (210.9) | (316.8) |
| Cash and cash equivalents at beginning of period | 297.9 | 642.0 |
| Cash and cash equivalents at end of period | 87.0 | 325.2 |
Source: StoneCo Ltd.