Slide 1: 4Q21 Earnings Presentation
1 4Q21 Earnings Presentation
Slide 2: Important Disclosure
2 Important Disclosure IN REVIEWING THE INFORMATION CONTAINED IN THIS PRESENTATION, 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 presentation is prepared by XP Inc
Slide 3: Index
3 Index 4Q21 KPIs and Financials 02 Q&A 03 01 2021 Recap
Slide 4: 2021 Recap
1 2021 Recap
Slide 5: Two years since IPO – 2021 Recap
5 20 19 5.5 2021E @IPO 10.5 2021 Actual 12.8 Two years since IPO – 2021 Recap 35% CAGR 52% CAGR Gross Revenues (in R$ bn) Top - line guidance Top - line growth Adj. Net Income (in R$ bn) 20 19 1 .1 2021E @IPO ¹ 2.1 2021 Actual 4.0 ~ 4x (1) Assuming 22% Adj. Net margin – top of the range of the first
Slide 6: Recent Developments: XP's Digital Account
6 Recent Developments Fully integrated experience Day - to - day bill payments Transfers between XP accounts Pix Automatic debit Payroll portability Deposits with QR Codes Pix “s aque e troco” XP’s Digital Account 67 % Completion ~150k digital account users
Slide 7: Recent Developments: XP's Life Insurance Launch
7 Recent Developments Official launch within 4 months, from interviews with clients to app offering Simple, fully digital hiring Transparency: no hidden costs XP’s Life Insurance Launch
Slide 8: 4Q21 KPIs and Financials
2 4Q21 KPIs and Financials
Slide 9: 4Q21 Highlights and Main KPIs
9 Notes: (1) See Company fillings for a reconciliation of Adjusted Net Income and Adjusted EBITDA; (2) This portfolio does not inc lude Intercompany and Credit Card related loans and receivables. Adjusted Net Income¹ 1 . 1 Bn +51% YoY Gross Revenue R $ 3 . 4 Bn Highlights KPIs R $ 2 . 4 Bn Gross Pro
Slide 10: Total Revenues and Retail Revenues
10 Total Revenues and Retail Revenues Total Gross Revenues (in R$ mn ) Highlights ▪ Driven by strong Retail revenue, with growing contribution from new verticals and fixed income products ; ▪ New initiatives – Pension, Credit Cards, Credit, and Insurance – already representing 6 % of total gross rev
Slide 11: Update on Macroeconomic Impacts on Retail
11 1Q15 4Q15 3Q16 2Q17 1Q18 4Q18 3Q19 2Q20 1Q21 4Q21 LTM Retail Revenue Source : Brazilian Central Bank, XP Inc. Update on Macroeconomic Impacts on Retail SELIC Fixed Income & Floating / Equities & Futures 31x revenue growth 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 0.0x 0.2x 0.4x 0.6x 0.8x 1.0x 1.2x 1
Slide 12: Retail Revenue and New Verticals
12 Retail Revenue and New Verticals Revenues from New Verticals (in R$ mn ) 19 54 86 58 74 28 46 18 15 12 154 4Q21 4Q20 3Q21 14 46 224 +387% Highlights ▪ Exponential growth of 387 % in one year, driven mainly by Pension Funds and Credit Cards Retail Revenue (in R$ mn ) 4Q21 3Q21 4Q20 1,844 2,599 2,7
Slide 13: New Verticals Update: Credit Cards and Private Pension
13 New Verticals Update Credit Cards (TPV market share %) Highlights ▪ From zero to over R $ 10 billion in total TPV in 2021 ▪ In December 2021 , we lowered the threshold for credit card eligibility to R $ 5 , 000 in XP brand Private Pension¹ (NNM market share %) Highlights ▪ From 5 th in NNM Rankin
Slide 14: New Verticals Update: Insurance and Credit
14 New Verticals Update Insurance Revenue (in R$ mn ) Highlights ▪ Launch of XP’s Life Insurance ▪ We still have a long way to go, with less than 0 . 1 % market share Credit (% of AUC) Highlights ▪ Consistent growth while maintaining zero NPL ▪ Margin loan and real estate mortgages soft launch Sourc
Slide 15: Adjusted EBITDA and Margin
15 Adjusted EBITDA and Margin Operational Leverage despite investments in technology, client experience and product offering Highlights ▪ Main drivers were ( 1 ) top line increase, mainly coming from Retail ; ( 2 ) higher gross margins, partially offset by investments in new initiatives . Adjusted E
Slide 16: Adjusted Net Income
16 % Adj Net Margin Adjusted Net Income¹ (in R$ mn ) Adjusted Net Income Highlights ▪ Adjusted Net Income grew 51 % vs . 4 Q 20 , explained by ( 1 ) strong growth in Retail Revenue, ( 2 ) operating leverage in SG&A and ( 3 ) a lower effective tax rate . 4Q20 3Q21 4Q21 721 1,039 1,086 +51% 30.1% 32.8
Slide 17: Non-GAAP Financial Information: Normalized Effective Tax Rate reconciliation
17 Non - GAAP Financial Information Normalized Effective Tax Rate reconciliation (in R$ mn ) PART OF OUR REVENUE IS RECOGNIZED NET OF TAXES. 4Q21 4Q20 YoY 3Q21 QoQ FY21 FY20 YoY Managerial Income Statement Total Gross Revenue 3,447 2,570 34% 3,368 2% 12,799 8,711 47% Net Revenue 3,260 2,395 36% 3,17
Slide 18: Q&A
Q&A
Slide 19: Investor Relations
19 Investor Relations ir@xpi.com.br https://investors.xpinc.com/
Slide 20: Appendix
Appendix
Slide 21: Non-GAAP Financial Information: Floating and Adjusted Gross Financial Assets
21 Non - GAAP Financial Information Floating and Adjusted Gross Financial Assets 21 Adjusted Gross Financial Assets (in R $ mn ) Floating Balance (in R $ mn ) Floating Balance (=net uninvested clients' deposits) 4Q21 4Q20 YoY 3Q21 QoQ Assets (1,406) (1,052) 34% (1,065) 32% (-) Securities trading and
Slide 22: Non-GAAP Financial Information: Adjusted Assets
22 Non - GAAP Financial Information Adjusted Assets (from the factors listed below) reflects our business more realistically 22 [B] Pension Funds ▪ AUM from XP Vida & Previdência is accounted in both assets and liabilities [C] Floating ▪ Uninvested cash from clients allocated in sovereign bonds [D]
Slide 23: Non-GAAP Financial Information: Adjusted EBITDA and Adjusted Net Income
23 4Q21 4Q20 YoY 3Q21 QoQ FY21 FY20 YoY EBITDA 1,241 705 76% 1,005 24% 4,190 2,616 60% (+) Share Based Compensation 149 180 -17% 165 -10% 658 293 124% (+) Offering expenses - 6 -100% - n.a. - 8 -100% Adj. EBITDA 1,390 891 56% 1,170 19% 4,848 2,918 66% Non - GAAP Financial Information Adjusted EBITDA
Slide 24: Institutional and Issuer Services
24 4Q21 4Q20 3Q21 307 281 326 +6% Institutional and Issuer Services Institutional Revenue (in R$ mn ) Highlights ▪ Mostly driven by strong volumes in offshore desks Issuer Services Revenue (in R$ mn ) Highlights ▪ Strong performance from DCM division, coupled with weaker ECM activity in Brazil, and