CI&T (NYSE: CINT, “Company”), a global digital specialist
and fast-growing technology company, today announces its results
for the first quarter of 2024 (1Q24) in accordance with
International Financial Reporting Standards (IFRS). For comparison
purposes, we refer to the results for the first quarter of 2023
(1Q23) and the fourth quarter of 2023 (4Q23).
First quarter of 2024 (1Q24) operating and financial
highlights
- Net Revenue was R$523.5 million compared to R$610.0 million in
1Q23 and R$522.6 million in 4Q23, a sequential growth of 0.2%.
- Net Profit was R$22.4 million compared to R$43.6 million in
1Q23.
- Adjusted EBITDA was R$84.3 million compared to R$116.5 million
in 1Q23. The Adjusted EBITDA margin was 16.1%.
- Adjusted Net Profit was R$41.7 million compared to R$62.4
million in 1Q23. The Adjusted Net Profit margin was 8.0%.
- CI&T ended 1Q24 with 6,083 CI&Ters compared to 6,111 at
the end of 4Q23.
Cesar Gon, founder and CEO of CI&T, commented, "Our first
quarter of 2024 has been truly transformative as we continue to
make tremendous strides in our journey to becoming an AI-first
company. By integrating AI into our operations and fostering a
culture of efficiency and innovation, we capitalize on the amazing
opportunities for value creation in this next chapter of the
digital revolution. As early results, we are pleased to announce a
70 basis point revenue growth above our guidance in 1Q24 and to
guide at least a 350 basis points sequential increase in 2Q24,
resuming our growth trajectory. We anticipate this momentum will
accelerate in the following quarters, leading to a period of
resurgent growth in 2024 and beyond."
Comments on the 1Q24 financial performance
The net revenue was R$523.5 million in 1Q24, a decline of 14.2%
compared to 1Q23, or a reduction of 12.1% at constant currency.
Compared to 4Q23, net revenue grew 0.2%. The geographic
distribution of net revenue for 1Q24 was 41.6% from North America,
42.5% from Latam, 11.7% from Europe, and 4.2% from Asia
Pacific.
The cost of services provided in 1Q24 was R$355.9 million, 12.7%
lower than in 1Q23, and the gross profit was R$167.6 million. The
adjusted gross profit in 1Q24 was R$178.4 million, with an adjusted
gross profit margin of 34.1%, 1.0 percentage point lower than in
1Q23.
In 1Q24, selling, general and administrative (SG&A), and
other operating expenses were R$114.4 million, a reduction of 2.1%
compared to 1Q23. This reduction can be primarily attributed to
the non-recurring M&A expenses incurred in 2023, partially
compensated by business restructuring expenses and increased sales
efforts to resume growth in 1Q24.
In 1Q24, the adjusted EBITDA was R$84.3 million, a reduction of
27.7% compared to 1Q23. Adjusted EBITDA margin was 16.1% in the
quarter, a reduction of 3.0 percentage points compared to 1Q23,
mainly due to the decline in the gross profit margin and higher
SG&A expenses as a percentage of net revenue.
In 1Q24, net financial costs were R$12.4 million, 38.1% lower
than in 1Q23, mainly driven by lower net foreign exchange
volatility in the comparable period, and lower net debt position
and interest rates.
Income tax expense was R$16.8 million in 1Q24, 17.9% lower than
in 1Q23. The income tax paid (cash effect) was R$3.3 million,
equivalent to a cash tax rate of 8.4%.
The net profit was R$22.4 million in 1Q24, compared to a net
profit of R$43.6 million in 1Q23. Adjusted net profit was R$41.7
million, a decrease of 33.1% compared to 1Q23. The adjusted net
profit margin decreased from 10.2% in 1Q23 to 8.0% in 1Q24, mainly
due to lower Adjusted EBITDA, partially compensated by lower net
financial costs and tax expenses, as explained above.
As of 1Q24, we are adding back stock-based compensation expenses
to calculate Adjusted Net Profit, a non-IFRS financial measure, to
align comparability with our main peers. For more details, please
refer to the Non-IFRS Financial Measures and Reconciliation tables
below.
Cash generated from operating activities was R$130.3 million in
1Q24, 11.8% higher than in 1Q23, due to an improvement in working
capital, specifically in trade receivables.
Business Outlook
We expect our net revenue in the second quarter of 2024 to be at
least R$542 million on a reported basis, equivalent to a 3.5%
growth compared to 1Q24. It assumes an average FX rate of 5.04
BRL/USD in 1Q24.
For the full year of 2024, we expect our net revenue growth at
constant currency to be in the range of -2.5% to +2.5%
year-over-year. In addition, we estimate our Adjusted EBITDA margin
to be in the range of 17% to 19%.
These expectations are forward-looking statements, and actual
results may differ materially. See "Cautionary Statement on
Forward-Looking Statements" below.
Conference Call Information
Cesar Gon, Bruno Guicardi, Stanley Rodrigues and Eduardo Galvão
will host a video conference call to discuss the 1Q24 financial and
operating results on May 22, at 8:00 a.m. Eastern Time / 09:00 a.m.
BRT. The earnings call can be accessed on the Company’s Investor
Relations website at https://investors.ciandt.com or at the
following link: https://www.youtube.com/watch?v=FA14fVjgLuY.
About CI&T
CI&T (NYSE: CINT) is a global hyper digital specialist, a
partner in AI-powered digital transformation and efficiency for
100+ large enterprises and fast growth clients. As digital natives,
CI&T brings a 29-year track record of accelerating business
impact through complete and scalable digital solutions. With a
global presence in nine countries with a nearshore delivery model,
CI&T provides strategy, data science, design, and engineering,
unlocking top-line growth, improving customer experience and
driving operational efficiency. Recognized by Forrester as a Leader
in Modern Application Development Services, CI&T is the
Employer of Choice for more than 6,000+ professionals.
Basis of accounting and functional currency
CI&T maintains its books and records in Brazilian reais,
which is the presentation currency of its unaudited condensed
consolidated interim financial statements, and the functional
currency of our operations in Brazil. CI&T prepares its
unaudited condensed consolidated interim financial statements in
accordance with IFRS, as issued by the IASB, and International
Financial Reporting Standard No 34—Interim Financial Reporting
(“IAS 34”).
Non-IFRS Financial Measures
We regularly monitor certain financial and operating metrics to
evaluate our business, measure our performance, identify trends
affecting our business, formulate financial projections, and make
strategic decisions. These non-IFRS financial measures include
Adjusted Gross Profit, Adjusted Gross Profit Margin, Adjusted
EBITDA, Adjusted EBITDA Margin, Adjusted Net Profit, Adjusted Net
Profit Margin, Net Revenue at Constant Currency, and Net Revenue
Growth at Constant Currency. They should be considered in addition
to results prepared in accordance with IFRS, but not as substitutes
for IFRS results. In addition, our calculation of these non-IFRS
financial measures may differ from those used by other companies,
and therefore, comparability may be limited. These non-IFRS
financial measures are provided as additional information to
enhance investors’ understanding of our operations’ historical and
current financial performance.
CI&T is not providing a quantitative reconciliation of its
forward-looking non-IFRS Net Revenue Growth at Constant Currency
and Adjusted EBITDA to the most directly comparable IFRS measure
because it cannot reasonably predict the outcome of certain
significant items without unreasonable efforts. These items
include, but are not limited to, stock-based compensation expenses,
acquisition-related expenses, the tax effect of non-IFRS measures,
foreign currency exchange gains/losses, and other items. These
items are uncertain, depend on various factors, and could have a
material impact on our IFRS-reported results for the guidance
period.
We calculate Net Revenue at Constant Currency and Net Revenue
Growth at Constant Currency by translating Net Revenue from
entities reporting in foreign currencies into Brazilian reais using
the comparable foreign currency exchange rates from the prior
period to show changes in our revenue without giving effect to
period-to-period currency fluctuations.
In calculating Adjusted Gross Profit, we exclude cost components
unrelated to the direct management of our services. For the periods
presented, the adjustments applied were: (i) depreciation and
amortization related to the costs of services provided and (ii)
stock-based compensation expenses.
In calculating Adjusted EBITDA, we exclude components unrelated
to the direct management of our services. We calculate Adjusted
EBITDA for the periods presented as Net Profit, plus net finance
costs, income tax expense, depreciation and amortization, plus: (i)
stock-based compensation expenses; (ii) government grants related
to tax reimbursement in our Chinese subsidiary; (iii)
acquisition-related expenses, including the present value and fair
value adjustment to accounts payable for business acquired,
consulting expenses, and retention packages; and (iv) business
restructuring expenses, associated with employees' separation from
acquired companies.
In calculating Adjusted Net Profit, we exclude components
unrelated to the direct management of our services. For the periods
presented, the adjustments have been made for (i)
acquisition-related expenses (including amortization of intangible
assets from acquired companies, present value and fair value
adjustments to accounts payable for business acquired, consulting
expenses, and retention packages); (ii) business restructuring
expenses, associated with employees' separation from acquired
companies; (iii) stock-based compensation expenses; and (iv) the
tax effects of non-IFRS adjustments.
Cautionary Statement on Forward-Looking Statements
This press release includes forward-looking statements within
the meaning of the safe harbor provisions of the United States
Private Securities Litigation Reform Act of 1995. All statements
other than statements of historical fact that may be deemed
forward-looking statements include, but are not limited to: the
statements under Business Outlook, including expectations relating
to revenues and other financial or business metrics; statements
regarding relationships with clients; and any other statements of
expectations or beliefs. The words “believe,” “will,” “may,” “may
have,” “would,” “estimate,” “continues,” “anticipates,” “intends,”
“plans,” “expects,” “budget,” "scheduled,” “forecasts” and similar
words are intended to identify estimates and forward-looking
statements, but the absence of these words does not mean that a
statement is not forward-looking. Forward-looking statements
represent our management's beliefs and assumptions only as of the
date of this press release. You should read this press release with
the understanding that our actual future results may be materially
different from our expectations. These statements are subject to
known and unknown risks, uncertainties, and other factors that may
cause our actual results, levels of activity, performance, or
achievements to be materially different from those expressed or
implied by such statements in this press release. Such risk factors
include, but are not limited to, those relating to: the ongoing war
in Ukraine and the economic sanctions imposed by Western economies
on Russia, as well as the conflict between Israel and Hamas, and
their impact on our business and industry; the impact of
competition on our business; uncertainty regarding the demand for
and market utilization of our services; our ability to maintain or
acquire new client relationships; general business and economic
conditions; our ability to successfully integrate the
recent-acquired business; the impact of pandemics, epidemics and
disease outbreak; and our ability to successfully implement our
growth strategy and strategic plans. Additional information about
these and other risks and uncertainties is contained in the Risk
Factors section of CI&T's annual report on Form 20-F.
Additional information will be made available in our Annual Reports
on Form 20-F, and other filings and reports that we may file from
time to time with the SEC. Except as required by law, we assume no
obligation to and do not intend to update these forward-looking
statements or to update the reasons why actual results could differ
materially from those anticipated in these forward-looking
statements, even if new information becomes available in the
future.
Unaudited condensed consolidated
statement of profit or loss
(In thousands of Brazilian Reais)
Quarter ended March
31,
2024
2023
Restated
Net revenue
523,509
609,991
Costs of services provided
(355,948
)
(407,861
)
Gross profit
167,561
202,130
Selling expenses
(46,250
)
(45,554
)
General and administrative expenses
(68,112
)
(71,222
)
Impairment loss on trade receivables and
contract assets
(1,787
)
(1,605
)
Other income net
160
324
Operating expenses net
(115,989
)
(118,057
)
Operating profit before net finance
costs and income tax expenses
51,572
84,073
Finance income
10,703
20,664
Finance cost
(23,056
)
(40,632
)
Net finance costs
(12,353
)
(19,968
)
Profit before income tax
39,219
64,105
Current
(8,437
)
(13,401
)
Deferred
(8,373
)
(7,070
)
Total income tax expense
(16,810
)
(20,471
)
Net profit for the year
22,409
43,634
Earnings per share
Earnings per share – basic (in R$)
0.16
0.33
Earnings per share – diluted (in R$)
0.16
0.32
Weighted average number of basic
shares
137,385,836
133,834,456
Weighted average number of diluted
shares
140,078,180
137,279,821
Unaudited condensed consolidated
statement of financial position
(In thousands of Brazilian Reais)
Assets
March 31,
2024
December 31,
2023
Liabilities and equity
March 31,
2024
December 31,
2023
Cash and cash equivalents
360,296
211,638
Suppliers and other payables
20,196
21,690
Financial Investments
-
3,164
Loans and borrowings
133,680
112,719
Trade receivables
312,016
471,951
Lease liabilities
15,708
17,862
Contract assets
250,998
147,620
Salaries and welfare charges
210,748
196,396
Recoverable taxes
38,400
23,588
Accounts payable for business acquired
110,180
13,365
Current Tax Assets
4,255
17,483
Current Tax liabilities
1,744
2,602
Derivatives
7,135
9,620
Other taxes payable
14,294
15,275
Other assets
28,991
27,072
Contract liability
29,632
48,079
Total current assets
1,002,091
912,136
Other liabilities
15,844
27,290
Total current liabilities
552,026
455,278
Recoverable taxes
742
959
Deferred tax assets
19,407
18,284
Judicial deposits
7,471
7,280
Loans and borrowings
660,269
614,744
Restricted cash - Escrow account and
indemnity asset
29,779
29,061
Deferred tax liabilities
77,659
68,465
Other assets
1,168
1,027
Lease liabilities
25,395
27,037
Property, plant and equipment
34,926
38,584
Provisions
9,696
9,620
Intangible assets and goodwill
1,691,283
1,669,865
Accounts payable for business acquired
30,802
122,689
Right-of-use assets
35,936
39,695
Other liabilities
14,067
7,807
Total non-current assets
1,820,712
1,804,755
Total non-current liabilities
817,888
850,362
Equity
Share capital
37
37
Share premium
983,194
980,893
Treasury share reserve
(4,143
)
-
Capital reserves
176,774
174,153
Retained earnings reserves
376,649
354,240
Other comprehensive loss
(79,622
)
(98,072
)
Total equity
1,452,889
1,411,251
Total assets
2,822,803
2,716,891
Total equity and liabilities
2,822,803
2,716,891
Unaudited condensed consolidated
statement of cash flows
(In thousands of Brazilian Reais)
March 31,
2024
March 31,
2023
Restated
Cash flows from operating
activities
Net profit for the period
22,409
43,634
Adjustments for:
Depreciation and amortization
21,876
25,053
Loss (income) on sale and write-off of
fixed assets
326
(95
)
Interest, monetary variation and exchange
rate changes
18,410
24,584
Unrealized gain on financial
instruments
(243
)
(4,544
)
Income tax expenses
16,810
20,471
Impairment losses on trade receivables and
contract assets
1,787
1,605
Provision (reversal of) for tax and labor
risks
76
(273
)
Share-based plan
3,772
5,393
Changes in present value of accounts
payable for business acquired
1,063
1,589
Others
10
41
Changes in operating assets and
liabilities
Trade receivables
166,683
49,460
Contract assets
(101,257
)
(18,900
)
Recoverable taxes
(7,119
)
245
Suppliers
(319
)
(11,672
)
Salaries and welfare charges
12,177
(7,628
)
Contract liabilities
(19,587
)
(12,657
)
Other receivables and payables, net
(6,603
)
256
Cash generated from operating
activities
130,271
116,562
Income tax paid
(3,303
)
(6,808
)
Interest paid on loans and borrowings
(7,019
)
(15,534
)
Interest paid on lease
(820
)
(1,148
)
Net cash from operating
activities
119,129
93,072
Cash flows from investment
activities
Acquisition of property, plant and
equipment and intangible assets
(11,175
)
(4,247
)
Redemption of financial investments
3,164
1,474
Net cash used in investment
activities
(8,011
)
(2,773
)
Cash flows from financing
activities
Exercised share-based compensation
921
478
Payment of lease liabilities
(5,707
)
(5,919
)
Proceeds from loans and borrowings
49,801
-
Proceeds from settlement of
derivatives
2,728
2,839
Payment of loans and borrowings
(8,924
)
(19,432
)
Payment of installment related to accounts
payable of business acquired
-
(1,235
)
Repurchase of treasury shares
(4,143
)
-
Net cash from (used in) financing
activities
34,676
(23,269
)
Net increase in cash and cash
equivalents
145,794
67,030
Cash and cash equivalents as of January
1st
211,638
185,727
Exchange variation effect on cash and cash
equivalents
2,864
(1,207
)
Cash and cash equivalents
360,296
251,550
Net Revenue Distribution
Net Revenue by industry
(in BRL thousand)
1Q24
1Q23
Var.
1Q24 x 1Q23
Financial Services
147,720
174,783
-15.5%
Consumer Goods
110,002
116,156
-5.3%
Technology and Telecommunications
60,628
125,060
-51.5%
Retail and Industrial Goods
91,058
75,814
20.1%
Life Sciences
54,372
63,281
-14.1%
Others
59,729
54,897
8.8%
Total
523,509
609,991
-14.2%
Net Revenue by geography
(in BRL thousand)
1Q24
1Q23
Var.
1Q24 x 1Q23
North America
217,945
263,386
-17.3%
Latin America
222,682
240,616
-7.5%
Europe
61,127
73,726
-17.1%
Asia Pacific
21,755
32,263
-32.6%
Total
523,509
609,991
-14.2%
Top Clients
(in BRL thousand)
1Q24
1Q23
Var.
1Q24 x 1Q23
Top Client (1)
33,839
67,425
-49.8%
Top 10 Clients
215,116
270,461
-20.5%
(1)
The top client considered in one period
may differ from that disclosed in another period.
Reconciliation of various income
statement amounts from IFRS to non-IFRS measures
Net Revenue
(in BRL thousand)
1Q24
1Q23
Var.
1Q24 x 1Q23
Net Revenue
523,509
609,991
-14.2%
Net Revenue at Constant Currency
536,299
609,991
-12.1%
Adjusted Gross Profit
(in BRL thousand)
1Q24
1Q23
Var.
1Q24 x 1Q23
Net Revenue
523,509
609,991
-14.2%
Cost of Services Provided
(355,948)
(407,861)
-12.7%
Gross Profit
167,561
202,130
-17.1%
Adjustments
Depreciation and amortization (cost of
services provided)
8,032
9,410
-14.6%
Stock-based compensation
2,757
2,376
16.0%
Adjusted Gross Profit
178,351
213,916
-16.6%
Adjusted Gross Profit Margin
34.1%
35.1%
-1p.p
Adjusted EBITDA
(in BRL thousand)
1Q24
1Q23
(Restated)
Var.
1Q24 x 1Q23
Net profit for the year
22,409
43,634
-48.6%
Adjustments
Net financial cost
12,353
19,968
-38.1%
Income tax expense
16,810
20,471
-17.9%
Depreciation and amortization
21,876
25,053
-12.7%
Stock-based compensation
3,772
5,393
-30.1%
Government grants
(71)
(140)
-48.9%
Acquisition-related expenses (1)
1,350
2,124
-36.4%
Business restructuring (2)
5,758
-
0.0%
Adjusted EBITDA
84,258
116,504
-27.7%
Adjusted EBITDA Margin
16.1%
19.1%
-3p.p
(1)
Include present value and fair value
adjustments on accounts payable for business acquired, consulting
expenses, and retention packages.
(2) Associated with employees' separation from acquired companies.
Adjusted Net Profit
(in BRL thousand)
1Q24
1Q23
(Restated)
Var.
1Q24 x 1Q23
Net profit for the year
22,409
43,634
-48.6%
Adjustments
Acquisition-related expenses (1)
12,144
14,836
-18.1%
Business restructuring (2)
5,758
-
0.0%
Stock-based compensation (3)
3,772
5,393
-30.1%
Tax effects on non-IFRS adjustments
(4)
(2,335)
(1,446)
61.5%
Adjusted Net Profit
41,749
62,418
-33.1%
Adjusted Net Profit Margin
8.0%
10.2%
-2.3p.p
(1)
Includes amortization of intangible assets
from acquired companies totaled (R$10,794) thousand in 1Q24 and
(R$12,712) thousand in 1Q23, present value and fair value
adjustment on accounts payable for business acquired, consulting
expenses and retention packages.
(2)
Associated with employees' separation from acquired companies.
(3)
As of 1Q24, we are adding back stock-based compensation expenses to
the Adjusted Net Profit calculation. Thus, comparison with
previously reported numbers will differ.
(4)
As of 4Q23, we are contemplating the tax
effects on non-IFRS adjustments as part of the Adjusted Net Profit
calculation. Thus, comparison with previously reported numbers will
differ.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240521341471/en/
Investor Relations Contact: Eduardo Galvão
investors@ciandt.com
Media Relations Contact: Zella Panossian
ciandt@illumepr.com
CI and T (NYSE:CINT)
過去 株価チャート
から 5 2024 まで 6 2024
CI and T (NYSE:CINT)
過去 株価チャート
から 6 2023 まで 6 2024
