Slide 1: 2Q2021 Earnings Release
<= wo Patrocinadora Oficial do Comité Olimpico do Brasil Investing on transformation: what we do better, now supporting Brazilian sport. a OFICIAL DO. COMITE OLIMPICO DO BRASIL. XPiinc. 2Q2021 Earnings Release August 3rd, 2021 Investors.xpinc.com
Slide 2: Key Business Metrics
(1) Does not include Credit Card related loans and receivables (2) See appendix for a reconciliation of Adjusted Net Income and Adjusted EBITDA Key Business Metrics 2Q21 2Q20 YoY 1Q21 QoQ Operating and Financial Metrics (unaudited) AUC (in R$ bn) 88% 14% Active clients (in '000s) 3,140 2,360 33% 2,9
Slide 3: Our Credit portfolio reached R$6.8 billion
Our Credit portfolio reached R$6.8 billion as of June 30, 2021, a 43% increase quarter-over-quarter. The duration of our credit book was 3.5 years , with a 90-day Non-Performing Loan (NPL) ratio of 0.0% . ¹This portfolio does not include Credit Card related loans and receivables Credit Card TPV (in
Slide 4: First full quarter since launching our credit card
2Q21 was the first full quarter since officially launching our credit card. For the quarter, we generated R$2.1 billion of TPV (Total Payment Value), a growth of 316% quarter-over-quarter, reinforcing the power of XP’s comprehensive platform.
Slide 5: Total AUC reached R$817 billion at June 30
Total AUC reached R$817 billion at June 30, up 88% year-over-year and 14% quarter-over-quarter. Year-over-year growth was driven by R$298 billion of net inflows and R$83 billion of market appreciation. Our growth reinforces the strength and resiliency of our business model, distribution capabilities
Slide 6: Net Inflows were up 9% quarter-over-quarter
Net Inflows were up 9% quarter-over-quarter , and 159% year-over-year . Flows were strong across all channels and brands, including over R$30 billion concentrated equity inflows at XP Private, awarded by Euromoney as Latin America’s best bank for wealth management 2021.
Slide 7: Active clients grew 33% and 5% in 2Q21
Active clients grew 33% and 5% in 2Q21 vs 2Q20 and 1Q21, respectively. Average monthly client additions decreased to 49,000 in 2Q21 from 72,000 in 1Q21, primarily reflecting slower activation at Clear, following lower market trading volumes, specifically futures. IFA Network Gross Adds
Slide 8: IFA Network gross additions totaled 1,198 in 2Q21
IFA Network gross additions totaled 1,198 in 2Q21, up 165% year-over-year and 31% quarter-over-quarter . Retail DATs¹ (mn trades)
Slide 9: Daily Average Trades
¹ Daily Average Trades, including Stocks, REITs, Options and Futures DATs totaled 2.7 million in 2Q21, a decline of 18% on a sequential basis following a decline in B3 traded volume versus a strong 1Q21, when futures volumes reached record highs. Despite the intense volatility and activity during 2Q
Slide 10: Total Gross Revenue (in R$ mn)
Total Gross Revenue (in R$ mn)
Slide 11: Total Gross Revenue reached an all-time high
Total Gross Revenue reached an all-time high, driven revenue diversification and growth in different business channels, increasing 57% from R$2.0 billion in 2Q20 to R$3.2 billion in 2Q21, reinforcing the strength of our business model. The increase was mainly driven by strong growth in (i) the Retai
Slide 12: Retail revenue grew 66%
2Q20 vs 2Q21 Retail revenue grew 66% from R$1.5 billion in 2Q20 to R$2.5 billion in 2Q21. Revenue generation was resilient despite stable volumes in DATs, which reinforces the importance of our diversified and comprehensive platform, with suitable products for different economic cycles and client’s
Slide 13: Take rate and Institutional revenue
The take rate for the last twelve months ended June 30, 2021 remained stable compared to the comparable period a year ago. Our ability to add new products and services in the platform - such as credit cards and credit - coupled with diversified revenue profile, could keep our take rate stable, despi
Slide 14: Institutional gross revenue totaled R$375 million
2Q20 vs 2Q21 Institutional gross revenue totaled R$375 million in the 2Q21, up 13% from R$333 million in 2Q20. Fixed Income activity was strong - benefiting from recent increases in interest rates in Brazil - driving the channel to record its best quarter so far, despite high equity trading volumes
Slide 15: Issuer Services revenue expanded 293% year-over-year
2Q20 vs 2Q21 Issuer Services revenue expanded 293% year-over-year from R$65 million in 2Q20, negatively impacted by the Covid-19 outbreak, to R$255 million in 2Q21. This increase was driven by (1) Equity Capital Markets (ECM), with 8 executed deals vs 2 in 2Q20, and (2) our Debt Capital Markets (DCM
Slide 16: COGS rose 54% from R$579 million to R$891 million
2Q20 vs 2Q21 COGS rose 54% from R$579 million in 2Q20 to R$891 million in 2Q21, following the expansion in overall Retail Revenues. The gross margin expanded 63 bps, from 69.8% to 70.5% mainly due to channel mix shifts, and despite the impact of long-term incentives paid to the IFA network.
Slide 17: SG&A expenses and share-based compensation
2Q20 vs 2Q21 SG&A expenses (excluding share-based compensation) totaled R$900 million in 2Q21, up 41% from R$638 million in 2Q20. Despite growing our headcount by 53% year-over-year, continuously investing in technology and new verticals, and deploying new products, we increased efficiency, reducing
Slide 18: Share-based compensation allocated in COGS
165 [lisec allocated in cogs. 147 40 | 18 2920 2021
Slide 19: Adjusted EBITDA grew 77%
¹ See appendix for a reconciliation of Adjusted EBITDA. 2Q20 vs 2Q21 Adjusted EBITDA grew 77%, from R$704 million to R$1,245 million and margins expanded from 36.6% to 41.3%, a result of a scalable business model, with significant cross-sell and operating leverage opportunities. Operating leverage b
Slide 20: Adjusted Net Income grew 83%
2Q20 vs 2Q21 Adjusted Net Income grew 83%, from R$565 million in 2Q20 to R$1,034 million in 2Q21, in connection with the factors explained in the Adjusted EBITDA plus a lower effective tax rate. Our effective tax rate decreased from 11.4% in the 2Q20 to 7.1% in 2Q21, mainly due to our current revenu