Slide 1: Earnings Presentation Q4 2023
Earnings Q4 2023 Presentation
Slide 2: Presenters
Pedro Arnt Sebastián Kanovich Sergio Fogel Diego Cabrera Canay Maria Oldham Co-Chief Executive Officer Co-Chief Executive Officer Co-President and Chief Chief Financial Officer SVP - Corp. Development, Strategy Officer Investor Relations and Strategic Finance
Slide 3: Safe Harbor
EARNINGS PRESENTATION Q4 2023 Safe This presentation may contain forward-looking statements. These forward-looking statements convey dLocal’s current Unless required by law, dLocal undertakes no obligation to publicly update or revise any forward-looking statements to reflect circumstances Harbor exp
Slide 4: Unlocking the potential of Emerging Markets
Unlocking the potential of Emerging Markets Santiago de Chile, Chile 4
Slide 5: Another year of strong results with stellar TPV and revenue growth
We delivered another year of strong results with stellar TPV and revenue growth Total Payment Volume Revenue Gross Profit Adjusted EBITDA1 FY23 $17.7B $650M $277M $202M +67% YoY +55% YoY +37% YoY +32% YoY +46% +71% +63% CAGR +43% CAGR CAGR CAGR 4Q23 $5.1B $188M $70M $49M +55% YoY | +11% QoQ +59% YoY
Slide 6: Building a global team for the long-term
Building a global team for the Technology & Product long-term FTE by 38% function (%): 901 Corporate central functions 18% +175 FTEs or 24% Employee Growth YoY Sales & Marketing AFRICA & ASIA AMERICAS 18% FTE evolution (#): 243 +53% YoY 658+16% YoY Operations & Expansion 25% Note: FTE includes emplo
Slide 7: Existing clients continue to drive strong revenue growth
Existing clients continue Top 10 merchant revenue1 ($M) and concentration (%) to drive strong revenue growth Successful execution of land-and-expand strategy, as we accelerate share of wallet gains in leading merchants, driving best-in-class NRR 150% NRR FY2023 % share of total revenue 56% 50% 60% 1
Slide 8: Strong TPV performance across diverse verticals
Strong TPV performance $17.7B Other2 29% across diverse verticals Travel 34% SaaS 59% 22% Commerce volume grew $10.6B Advertising On-demand 3x YoY supported by the delivery 29% success of our platform Ride-hailing 62% solution 48% $6.0B Streaming Financial Services1 53% Commerce 197% Note: 1 In FY 2
Slide 9: Solving for the complex, fragmented payments ecosystem
Maximizing reach by accepting key local payment methods Non-credit card volume accounted for 75% of total TPV in 2023 Solving for the complex, 21% fragmented 30% payments 277 255 79% 70% ecosystem 188 Other payment methods include: in EMs 55 35 1 Bank Cash alike Debit Digital Local Mobile transfers
Slide 10: License portfolio continues to increase
License portfolio continues to increase, with 10+ new registries and licenses, creating greater differentiation in Emerging Markets Payment License, Registration or Permission Holder Payment License, Registration or Permission holder, additional ones in process Payment License, Registration or Permi
Slide 11: LatAm and Africa & Asia revenue
LatAm: sustained strong Africa & Asia: we continue to revenue in our largest experience strong traction markets, Brazil and Mexico doubling our revenue YoY Latin America revenue Africa & Asia revenue ($M) ($M) +43% YoY +114% YoY % share of total % share of total revenue 92% 82% 76% revenue 8% 18% 24
Slide 12: Financial Highlights
Financial Highlights 12
Slide 13: TPV evolution: pay-ins, pay-outs, cross-border, local-to-local
Pay-outs2 TPV evolution ($B) +19% QoQ Pay-ins1 TPV evolution ($B) +8% QoQ +47% YoY +59% YoY Robust growth rates in Pay-ins and Pay-outs % share 71% 70% 73% 74% 72% % share 29% 30% 27% 26% 28% Cross-border3 TPV evolution ($B) -1% QoQ Local-to-Local4 TPV evolution ($B) +22% QoQ +28% YoY +86% YoY TPV e
Slide 14: Record revenue of $188M supported by existing merchant base
Revenue evolution ($M) Excluding Argentina +15% QoQ +27% QoQ Record revenue of +59% YoY +70% YoY $188M supported by existing merchant base, with NRR at 149% in 4Q23… …despite negative impact from Argentina Argentina1 Note: 1YoY and QoQ growth is presented excluding Argentina due to significant revenu
Slide 15: Gross profit increased by 48% YoY and 7% QoQ excluding Argentina
Gross Profit evolution ($M) Excluding Argentina -6% QoQ +7% QoQ Gross profit +27% YoY +48% YoY increased by 48% YoY and 7% QoQ, when excluding Argentina Argentina1 Note: 1YoY and QoQ growth is presented excluding Argentina due to significant revenue and gross profit contraction in Argentina driven large
Slide 16: Gross profit margin and net take rate drivers
Gross profit margin impacted primarily by higher expatriation costs; contraction in net take rates mainly driven by business mix Gross Profit margin (%) QoQ bridge Gross Profit over TPV (%) QoQ bridge Increase in Lower pay-outs cross-border Driven TPV share TPV share primarily by Decrease in (+2p.p. To
Slide 17: Adjusted EBITDA evolution
QoQ impact on Adjusted EBITDA mainly driven by gross profit contraction and investments in the team for future growth; Adjusted EBITDA over gross profit remains >70%, Adjusted EBITDA1 evolution ($M) Adjusted EBITDA ratios evolution (%) -11% QoQ +22% YoY Note: 1dLocal has only one operating segment. Al
Slide 18: Adjusted EBITDA over gross profit margin bridge
QoQ Adjusted EBITDA over gross profit margin contraction driven by investments in the company infrastructure to sustain long-term growth: tech-related items and people Adjusted EBITDA1 over Gross Profit margin QoQ bridge (%) 2 2 Note: 1dLocal has only one operating segment. Although Adjusted EBITDA an
Slide 19: Net income +47% YoY, QoQ decline drivers
Net income +47% YoY, QoQ decline driven by gross profit contraction, increased share-based compensation and inflation adjustment in Argentina Net income evolution ($M) Net income bridge QoQ ($M) -29% QoQ +47% YoY Reversal of the allowances of the FTX deposits: Class action Q3 = gain of 2.5m expenses Q
Slide 20: Strong balance sheet position with own funds cash conversion >100%
Strong balance sheet position; with own funds cash conversion > 100% Consolidated cash reconciliation ($M) Robust own liquidity of +$38M $326M: $223M own cash + +$50M $103M short-term investments (Argentine dollar-linked bonds) Recovery of the Further investments in Strong FCF1 (own-funds) restricte
Slide 21: Full year 2024 outlook
Full year 2024 outlook TPV Gross Profit Adjusted EBITDA $25-27B $320-360M $220-260M ● The respective midpoints imply ● Growth driven by increased ● Growth of “Tier 0” merchants Adjusted EBITDA over gross share of wallet from existing ● Sustained growth in our local to profit of around 70% merchants lo
Slide 22: Highlights
Highlights We power a massive and expanding emerging markets ecosystem accepting more than 900 local payment methods across 40+ countries We are directly integrated with some of the world’s largest online merchants, driving very strong NRR and cohort performance We have built a scalable, single API
Slide 23: Thanks
Thanks d-local
Slide 24: Appendix
APPENDIX
Slide 25: TPV
TPV breakdown by type of product1 TPV In millions of US$ 4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023 Pay-ins 2,334 2,503 3,190 3,429 3,701 7,905 12,823 As % of total 71% 70% 73% 74% 72% 75% 73% Pay-outs 962 1,072 1,184 1,189 1,410 2,661 4,855 As % of total 29% 30% 27% 26% 28% 25% 27% Total TPV 3,296 3,574 4,
Slide 26: Revenue
Revenue Revenue breakdown by geography In millions of US$ 4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023 Brazil 23.4 22.8 41.2 44.7 50.2 84.0 159.0 Argentina 14.2 20.0 20.7 23.9 10.5 77.6 75.1 Mexico 22.4 22.7 28.3 30.2 35.6 68.0 116.8 Chile 13.9 14.2 14.2 12.4 14.9 52.5 55.7 Other LatAm 18.9 18.5 22.5 24.8 20.
Slide 27: Revenue
Revenue Top 10 merchant revenue1($M) and concentration (%) Revenue composition ($M) 149% NRR2 % Share of total 55% 58% 59% 60% 68% revenue Note: 1Top 10 merchants may vary from period to period. 2“NRR” means Net Revenue Retention rate, which is the U.S. dollar-based measure of retention and growth o
Slide 28: Adjusted EBITDA
Adjusted Adjusted EBITDA bridge ($M) EBITDA Note: Adjusted EBITDA excludes one-off expenses and non-cash items. Unaudited quarterly results. See detailed methodology for Adjusted EBITDA in slide 29. 28
Slide 29: Adjusted EBITDA
Adjusted Reconciliation of Profit to Adjusted EBITDA EBITDA $ in thousands 4Q22 3Q23 4Q23 Profit for the period 19,364 40,364 28,481 Income tax expense 3,935 8,897 7,476 Depreciation and amortization 2,457 3,237 3,604 Finance income and costs, net 3,071 (1,548) (996) Share-based payment non-cash charg
Slide 30: Adjusted Net Income
Adjusted Reconciliation of Profit to Adjusted Net Income Net $ in thousands 4Q22 3Q23 4Q23 Profit for the period 19,364 40,364 28,481 Income Share-based payment non-cash charges 3,810 3,322 4,850 Other operating (gain)/loss (9) - - Impairment loss / (gain) on financial assets 5,640 (2,508) (657) Inflati
Slide 31: Robust global network of trusted financial partners
4Q23 cross-border expatriation Robust global volumes by partner mix: network of trusted 0.3% 0.2% financial partners 3%7% 6% 5% 7% In Q4 2023, we expatriated close to 9% 80% of the pay-ins cross-border TPV through banks (global, continental or national partner banks) 79% 84% 31
Slide 32: Cohort evolution
Cohort evolution TPV by Cohort1 ($M) 297 260 246 188 56 36 1 32 1 Each cohort is comprised by all of the merchants that began processing TPV in each period, regardless of volume of TPV processed. As cohorts prior to 2018 are not illustrated, the sum of the TPV of the different cohorts for each perio