UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of August 2024

Commission File Number: 001-40451

DLocal Limited

(Exact name of registrant as specified in its charter)

Dr. Luis Bonavita 1294

Montevideo

Uruguay 11300

+1 (424) 392-7437

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes ☐ No ☒

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes ☐ No ☒


 

 

TABLE OF CONTENTS

EXHIBIT

 

 

 

99.1

Press release dated August, 14 2024 - DLocal Limited Reports 2024 Second Quarter Results

 

99.2

DLocal Limited Unaudited Consolidated Condensed Interim Financial Statements as of June 30, 2024 and for the six-month and three-month periods ended June 30, 2024 and 2023

 

99.3

 

Quaterly Report 2024 - dLocal Reports 2024 Second Quarter Financial Results

 

99.4

 

dLocal Q2 2024 Earnings Presentation

 


 

 

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

DLocal Limited

 

 

 

 

 

 

By:

/s/ Mark Ortiz

 

 

Name:

Mark Ortiz

 

 

Title:

Chief Financial Officer

 

 

Date: August, 14 2024

 


Exhibit 99.1

img175954462_0.jpg 

 

dLocal Reports 2024 Second Quarter Financial Results

 

Second Quarter 2024

US$6.0 billion Total Processed Volume, up 38% year-over-year and 14% quarter-over-quarter

Revenue of US$171 million, up 6% year-over-year and down 7% quarter-over-quarter

100% Net Revenue Retention Rate

Gross Profit of US$70 million, down 1% year-over-year and up 11% quarter-over-quarter

Adjusted EBITDA of US$43 million, down 18% year-over-year and up 16% quarter-over-quarter

 

dLocal reports in US dollars and in accordance with IFRS as issued by the IASB

 

Montevideo, Uruguay August 14th, 2024 — DLocal Limited (“dLocal”, “we”, “us”, and “our”) (NASDAQ:DLO), a technology - first payments platform today announced its financial results for the second quarter ended June 30, 2024.


We continue to see strong growth in our business, achieving another quarterly record of $6.0 billion of TPV during the second quarter of 2024, an increase of nearly 40% year-over-year. This occurred despite the tough comparison with last year's 80% growth during the same period. The evolution of this key metric demonstrates our continued ability to grow as we gain share of wallet from our global merchant base and add new merchants to the mix. It also underscores our unique value proposition as a trusted partner for some of the largest and most sophisticated global companies across emerging markets.

The TPV performance was good across multiple verticals, including continued strong growth in the commerce, on-demand delivery, and remittance verticals; accelerating growth from SaaS and ride-hailing. This kind of sustained and well diversified TPV growth, with a focused commitment to low-risk high-reputation verticals, sets us up well for long-term success. We believe that our year-over-year growth showcases a unique in class combination of growth while focusing on reputable verticals, which sets us apart from relevant comps base, who either grow less, over index high-risk verticals, or do both.

Net take rates have held up sequentially, despite unfavorable events, like repricing by our largest merchant at the beginning of the year, material currency devaluations in Nigeria and Egypt, and continued weakening across most emerging markets currencies. The stable sequential net take rate and growing TPV during the quarter translated to 11% quarter-over-quarter gross profit growth.

Our OPEX, excluding non-cash share-based compensation, grew by only $1 million sequentially, after previous quarters of sequential growth above $4 million, as we adjusted our cash spend to the weaker gross profit. As mentioned previously, there is a limit to how much we are willing to defend margins in the short-term, as we are committed to certain investments, which are crucial for our long-term success, particularly those in our engineering pool, back-office capabilities and behind our license portfolio. But, to balance this out, we are always revising other discretionary spending to make sure it matches our topline performance and is aligned with our general philosophy of frugality. Consequently, our Adjusted EBITDA reached $43 million, reflecting our still lean structure and disciplined spending. Our cash generation also accelerated versus the prior quarter, posting a $35 million of Free Cash Flow from own funds, a conversion rate of 77%, up $23 million and 7 percentage points compared to the second quarter of 2023.

These highlights also come with certain challenges that we are focused on rapidly addressing. Year-over-year gross profit performance was flat, primarily due to a 13% decline in LatAm. This decline was driven by (i) the Argentine FX devaluation and (ii) the repricing by our largest merchant in Brazil and Mexico. Despite stellar Africa and Asia gross profit growth of 79% year-over-year, it did not suffice to offset those two events.

Taking a step back from a short-term quarterly prism, dLocal remains an incredibly strong company, with a fantastic total addressable market, attractive business model and extremely promising future, that at some point will be reflected in capital market performance. To keep things in perspective:

We maintain strong product market validation as witnessed by almost 40% year-over-year and 14% quarter-over-quarter TPV growth;
Still run a high margin financial model with Adjusted EBITDA to Gross Profit at 60%+ and ability to scale from there to previous levels;
Cash conversion is strong and growing as EBITDA increased sequentially, with a cash conversion close to 100% for the last twelve months.

When we analyze the potential of all this compounded over time, it is hard to not be optimistic about our future, despite the inherent challenges and volatility existent in emerging markets. The long term future is bright, and our own ability to execute is the most important factor.


Exhibit 99.1

Our optimism in the future is also reflected in our capital allocation strategy. Our business has an attractive cash generation profile, and we see upside in our stock as we grow and scale; and as a consequence of this we have bought back stock during the quarter at a rapid pace.

As known, emerging markets are inherently volatile, which can, and often do, impact our short-term results. However, our long-term view remains optimistic as stated earlier. The quarterly bottom-up review of our pipeline and existing contracts, where we project out probable market growth, and new commercial opportunities on a merchant-by-merchant basis, gets us to the following revised outlook for 2024:

TPV of $24.5-26.5 billion; due to slower volume ramp-ups, pipeline volume even more skewed towards Tier 0 merchants, and weakening currencies in emerging markets
Gross profit of $280-300 million; in addition to the reasons outlined above, driven by increased local-to-local flows, and
Adjusted EBITDA of $180-200 million, supporting crucial long-term investments that enhance our value proposition and internal controls

We continue to thrive across emerging markets, embracing their complexities and delivering simple, effective solutions to our merchants. Our focus remains on execution and long-term growth. Our commitment to our merchants and our expertise in these regions enable us to consistently win business from these global merchants. As we scale, this growth will help mitigate short-term volatility and dilute market fluctuations. Therefore, it is crucial to continue focusing on TPV growth, increasing our share of wallet, and adding new clients - all of which we have consistently delivered since the company's inception, while driving operational leverage in the business once we get through the current disciplined investment cycle we are in.

We are thankful for the continued support and confidence in our vision. We are committed to executing our strategy and driving long-term value for our shareholders. We look forward to updating you on our progress in the coming quarters.

 

Second quarter 2024 Financial Highlights

Total Payment Volume (“TPV”) reached a record US$6.0 billion in the second quarter, up 38% year-over-year compared to US$4.4 billion in the second quarter of 2023 and up 14% compared to US$5.3 billion in the first quarter of 2024.
Revenues amounted to US$171.3 million, up 6% year-over-year compared to US$161.1 million in the second quarter of 2023 and down 7% compared to US$184.4 million in the first quarter of 2024. This quarter-over-quarter decline was mostly driven by the currency devaluation in Nigeria and Egypt, despite the healthy TPV growth.
Gross profit was US$69.8 million in the second quarter of 2024, down 1% compared to US$70.8 million in the second quarter of 2023 and up 11% compared to US$63.0 million in the first quarter of 2024. The improvement in gross profit quarter-over-quarter was primarily due to (i) temporary FX dynamics in Nigeria; (ii) positive performance of Argentina, Other LatAm and Other Africa and Asia countries; and (iii) Brazil, with lower processing costs following renegotiation with processors, and change in payment mix, which partially offset the impact of key merchant repricing (full impact in second quarter of 2024 versus two months in first quarter of 2024).
As a result, gross profit margin was 41% in this quarter, compared to 44% in the second quarter of 2023 and 34% in the first quarter of 2024.
Gross profit over TPV was at 1.2% decreasing from 1.6% in the second quarter of 2023 and flat compared to the first quarter of 2024, mainly due to FX dynamics in Nigeria and Egypt and renegotiation with processors in Brazil, which combined were sufficient to offset the incremental sequential impact of the above-mentioned top merchant repricing..
Operating income was US$30.2 million, down 37% compared to US$47.8 million in the second quarter of 2023 and up 12% compared to US$26.9 million in the first quarter of 2024, impacted by higher gross profit and disciplined OPEX investment. In this context, operating expenses grew by 72% year-over-year and 10% quarter-over-quarter, with a clear allocation tilt towards investments focused on Product Development & IT capabilities; coupled with investment to strengthen our back-office capabilities for future growth. In addition, in the second quarter of 2024, we recorded an extraordinary US$1.6 million operating loss as we wrote-off certain amounts related to merchants/processors off-boarded by dLocal.
As a result, Adjusted EBITDA was US$42.7 million , down 18% compared to US$52.0 million in the second quarter of 2023 and up 16% compared to US$36.8 million in the first quarter of 2024.
Adjusted EBITDA margin was 25%, compared to the 32% recorded in the second quarter of 2023 and 20% in the first quarter of 2024. On the annual comparison, the decrease is explained by the gross profit dynamics and our decision to sustain many of the long-term investments, as previously mentioned. Following the same trend, Adjusted EBITDA over gross profit of 61% decreased compared to 74% in the second quarter of 2023 and increased compared to 58% in the first

Exhibit 99.1

quarter of 2024.
Net financial income was US$28.0 million, compared to US$7.5 million in the second quarter of 2023 and US$0.3 million in the first quarter of 2024.
Effective income tax rate was 18%, compared to 16% in the second quarter of 2023 and 29% in the first quarter of 2024, closer to levels of previous quarters.
Net income for the second quarter of 2024 was US$46.2 million, or US$0.15 per diluted share, up 3% compared to a profit of US$44.8 million, or US$0.15 per diluted share, for the second quarter of 2023 and up 161% compared to a profit of US$17.7 million, or US$0.06 per diluted share for the first quarter of 2024. During the second quarter of 2024, net income was mostly impacted by higher finance income, given the $23 million non-cash mark to market effect related to Argentine bonds investments used to hedge our local currency position in that market.
As of June 30, 2024, dLocal had US$531.6 million in cash and cash equivalents, including US$186.2 million of own funds and US$345.4 million of merchants’ funds. The consolidated cash position decreased by US$17.8 million from US$549.4 million as of June 30, 2023. When compared to the US$572.4 million cash position as of March 31, 2024, it decreased by US$40.7 million, mainly explained by the US$81.8 million of own funds used to buy back the company’s own shares, in connection to the US$200 million Share Buyback Program announced in May 2024.

 

The following table summarizes our key performance metrics:

 

 

Three months ended 30 of June

Six months ended 30 of June

 

2024

2023

% change

2024

2023

% change

Key Performance metrics

(In millions of US$ except for %)

TPV

6,035

4,373

38%

11,346

7,948

43%

Revenue

171.3

161.1

6%

355.7

298.4

19%

Gross Profit

69.8

70.8

-1%

132.8

132.6

0%

Gross Profit margin

41%

44%

-3p.p

37%

44%

-7p.p

Adjusted EBITDA

42.7

52.0

-18%

79.5

97.5

-19%

Adjusted EBITDA margin

25%

32%

-7p.p

22%

33%

-10p.p

Adjusted EBITDA/Gross Profit

61%

74%

-12p.p

60%

74%

-14p.p

Profit

46.2

44.8

3%

64.0

80.2

-20%

Profit margin

27%

28%

-1p.p

18%

27%

-9p.p

 

 

 


Exhibit 99.1

First quarter 2024 Business Highlights

 

During the second quarter of 2024, pay-ins TPV increased 34% year-over-year and 17% quarter-over-quarter to US$4.3 billion, accounting for 71% of the TPV.
Pay-outs TPV increased by 49% year-over-year and 7% quarter-over-quarter to US$1.8 billion, accounting for the remaining 29% of the TPV.
Cross-border TPV increased by 22% year-over-year and 11% quarter-over-quarter to US$2.7 billion. Cross-border volume accounted for 45% of the TPV in the second quarter of 2024.
Local-to-local TPV increased by 55% year-over-year and 16% quarter-over-quarter to US$3.3 billion. Local-to- local volume accounted for 55% of the TPV in the second quarter of 2024.
LatAm revenue increased 9% year-over-year to US$138.7 million, accounting for 81% of total revenue. On the annual comparison, the growth was primarily driven by commerce and streaming in Mexico, and strong performance of Other LatAm, across different verticals. Sequentially, LatAm revenue grew by 11% mainly driven by recovery in Argentina revenues due to strong performance across commerce and on-demand delivery verticals.
In the Africa and Asia region, revenue decreased by 5% year-over-year, primarily driven by lower revenues in Nigeria due to Naira devaluation in February 2024, despite strong growth performance in Egypt across advertising and streaming verticals; and in Other Africa and Asia. The currency devaluation is also the main driver of the sequential decrease.
LatAm gross profit decreased by 13% year-over-year and increased by 10% quarter-over-quarter to US$53.5 million, accounting for 77% of total gross profit. Most of the year-over-year decline is explained by Argentina, due to lower FX spreads following the currency devaluation in December 2023. In the region, gross profit was also impacted by Mexico, due to merchant repricing and local-to-local increase; and by Chile, given lower cross-border volumes. Other LatAm markets showed a 10% year-over-year increase in gross profit, driven by Tier 0 merchants’ growth. Sequentially, the growth was mainly driven by the (i) growth in Argentina, and other LatAm markets, primarily Colombia and Costa Rica; and (ii) Brazil, with lower processing costs following renegotiation with processors, coupled with change in payment mix. Those two factors partially offset the impact of a key merchant repricing, with full impact in the second quarter of 2024 compared to 2 months in previous one.
Africa and Asia gross profit increased by 79% year-over-year to US$16.3 million, accounting for the remaining 23% of total gross profit. This annual comparison is explained by our overall growth in Egypt; ramp-up of our merchants in South Africa, primarily in the commerce vertical; and temporary FX dynamics in Nigeria. Sequentially, gross profit increased by 13%, attributable to temporary FX dynamics in Nigeria and growth in Other Africa and Asia.
During the quarter, Revenue from Existing Merchants reached US$161.7 million compared to US$ 177.1 million in the first quarter of 2024. The quarter-over-quarter comparison was negatively affected by the currency devaluation, as previously discussed, despite healthy volume growth. On the annual comparison, Revenue from Existing Merchants increased by 8% and the net revenue retention rate, or NRR, reached 100%, which was impacted by Nigeria currency devaluation.
Revenue from New Merchants accounted for US$9.6 million in the second quarter of 2024 compared to US$ 11.2 million in the same quarter of the prior year.

 

 


Exhibit 99.1

The tables below present a breakdown of dLocal’s TPV by product and type of flow:

 

In millions of US$ except for %

Three months ended 30 of June

Six months ended 30 of June

 

2024

% share

2023

% share

2024

% share

2023

% share

Pay-ins

4,273

71%

3,190

73%

7,930

70%

5,693

72%

Pay-outs

1,763

29%

1,184

27%

3,416

30%

2,255

28%

Total TPV

6,035

100%

4,373

100%

11,346

100%

7,948

100%

 

 

In millions of US$ except for %

Three months ended 30 of June

Six months ended 30 of June

 

2024

% share

2023

% share

2024

% share

2023

% share

Cross-border

2,701

45%

2,219

51%

5,127

45%

4,179

53%

Local-to-local

3,334

55%

2,154

49%

6,219

55%

3,769

47%

Total TPV

6,035

100%

4,373

100%

11,346

100%

7,948

100%

 

 

 

The tables below present a breakdown of dLocal’s revenue by geography:

 

In millions of US$ except for %

Three months ended 30 of June

Six months ended 30 of June

 

2024

% share

2023

% share

2024

% share

2023

% share

Latin America

138.7

81%

126.9

79%

264.1

74%

225.1

75%

Brazil

42.3

25%

41.2

26%

85.3

24%

64.0

21%

Argentina

20.5

12%

20.7

13%

34.3

10%

40.7

14%

Mexico

35.8

21%

28.3

18%

69.9

20%

51.0

17%

Chile

12.3

7%

14.2

9%

24.7

7%

28.4

10%

Other LatAm

27.8

16%

22.5

14%

49.9

14%

41.0

14%

 

 

 

 

 

 

 

 

 

Africa & Asia

32.6

19%

34.3

21%

91.6

26%

73.3

25%

Nigeria

1.1

1%

20.4

13%

8.3

2%

47.3

16%

Egypt

15.0

9%

4.7

3%

54.0

15%

8.1

3%

Other Africa & Asia

16.5

10%

9.2

6%

29.2

8%

17.9

6%

 

 

 

 

 

 

 

 

 

Total Revenue

171.3

100%

161.1

100%

355.7

100%

298.4

100%

 

 

 


Exhibit 99.1

The tables below present a breakdown of dLocal’s gross profit by geography:

 

 

In millions of US$ except for %

Three months ended 30 of June

Six months ended 30 of June

 

2024

% share

2023

% share

2024

% share

2023

% share

Latin America

53.5

77%

61.7

87%

102.1

77%

114.5

86%

Brazil

19.2

28%

19.6

28%

37.1

28%

30.6

23%

Argentina

7.6

11%

13.8

19%

12.8

10%

31.6

24%

Mexico

8.8

13%

10.6

15%

18.7

14%

17.5

13%

Chile

8.3

12%

8.9

13%

15.7

12%

18.0

14%

Other LatAm

9.6

14%

8.7

12%

17.7

13%

16.8

13%

 

 

 

 

 

 

 

 

 

Africa & Asia

16.3

23%

9.1

13%

30.7

23%

18.1

14%

Nigeria

2.0

3%

0.2

0%

2.5

2%

2.6

2%

Egypt

9.8

14%

4.2

6%

20.1

15%

6.9

5%

Other Africa & Asia

4.5

7%

4.7

7%

8.1

6%

8.5

6%

 

 

 

 

 

 

 

 

 

Total Gross Profit

69.8

100%

70.8

100%

132.8

100%

132.6

100%

 

 


Exhibit 99.1

Special note regarding Adjusted EBITDA and Adjusted EBITDA Margin

 

dLocal has only one operating segment. dLocal measures its operating segment’s performance by Revenues, Adjusted EBITDA and Adjusted EBITDA Margin, and uses these metrics to make decisions about allocating resources.

 

Adjusted EBITDA as used by dLocal is defined as the profit from operations before financing and taxation for the year or period, as applicable, before depreciation of property, plant and equipment, amortization of right-of-use assets and intangible assets, and further excluding the changes in fair value of financial assets and derivative instruments carried at fair value through profit or loss, impairment gains/(losses) on financial assets, transaction costs, share-based payment non-cash charges, secondary offering expenses, and inflation adjustment. dLocal defines Adjusted EBITDA Margin as the Adjusted EBITDA divided by consolidated revenues.

 

Although Adjusted EBITDA and Adjusted EBITDA Margin may be commonly viewed as non-IFRS measures in other contexts, pursuant to IFRS 8, (“Operating Segments”), Adjusted EBITDA and Adjusted EBITDA Margin are treated by dLocal as IFRS measures based on the manner in which dLocal utilizes these measures. Nevertheless, dLocal’s Adjusted EBITDA and Adjusted EBITDA Margin metrics should not be viewed in isolation or as a substitute for net income for the periods presented under IFRS. dLocal also believes that its Adjusted EBITDA and Adjusted EBITDA Margin metrics are useful metrics used by analysts and investors, although these measures are not explicitly defined under IFRS. Additionally, the way dLocal calculates operating segment’s performance measures may be different from the calculations used by other entities, including competitors, and therefore, dLocal’s performance measures may not be comparable to those of other entities. Finally, dLocal is unable to present a quantitative reconciliation of forward-looking guidance for Adjusted EBITDA and Adjusted EBITDA over gross profit, which are forward-looking non-IFRS measures, because dLocal cannot reliably predict certain of their necessary components, such as impairment gains/(losses) on financial assets, transaction costs, and inflation adjustment.

 

The table below presents a reconciliation of dLocal’s Adjusted EBITDA and Adjusted EBITDA Margin to net income:

 

 

$ in thousands

Three months ended 30 of June

Six months ended 30 of June

 

2024

2023

2024

2023

Profit for the period

46,239

44,791

63,957

80,241

Income tax expense

10,060

8,774

17,174

13,055

Depreciation and amortization

4,089

2,869

7,851

5,384

Finance income and costs, net1

(28,045)

(7,459)

(28,344)

(8,850)

Share-based payment non-cash charges

6,776

1,421

11,237

3,750

Other operating loss2

1,553

-

3,372

-

Impairment loss / (gain) on financial assets

76

(21)

(101)

30

Inflation adjustment

1,941

1,661

4,309

2,680

Other non-recurring costs

-

-

-

1,229

Adjusted EBITDA

42,689

52,036

79,455

97,519

 

Note: 1In Q2 2024, the Finance income and costs, net line was impacted by the non-cash mark to market effect related to Argentine bonds investments in the amount of US$22.8 million. 2In Q2 2024, the company wrote-off certain amounts related to merchants/processors off-boarded by dLocal.

 

 


Exhibit 99.1

Special note regarding Adjusted Net Income

 

Adjusted Net Income is a non-IFRS financial measure. As used by dLocal Adjusted net income is defined as the profit for the period (net income) excluding impairment gains/(losses) on financial assets, transaction costs, share-based payment non-cash charges, secondary offering expenses, and other operating (gain)/loss, in line with our Adjusted EBITDA calculation (see detailed methodology for Adjusted EBITDA in page 13). It further excludes the accounting non-cash charges related to the fair value gain from the Argentine dollar-linked bonds and the exchange difference loss from the intercompany loan denominated in USD that we granted to our Argentine subsidiary to purchase the bonds. In addition, it excludes the inflation adjustment based on IFRS rules for hyperinflationary economies. We believe Adjusted Net Income is a useful measure for understanding our results for operations while excluding for certain non-cash effects such as currency devaluation and inflation. Our calculation for Adjusted Net Income may differ from similarly-titled measures presented by other companies and should not be considered in isolation or as a replacement for our measure of profit for the period as presented in accordance with IFRS.

 

The table below presents a reconciliation of dLocal’s Adjusted net income:

 

 

 

 

 

 

$ in thousands

Three months ended 30 of June

Six months ended 30 of June

 

2024

2023

2024

2023

Net income as reported

46,239

44,791

63,957

80,241

Inflation adjustment

1,941

1,661

4,309

2,680

Loan - exchange difference

5,831

1,815

12,560

1,815

Fair value (loss) / gains of financial assets at FVTPL (bonds)

(22,774)

(3,565)

(33,589)

(3,654)

Impairment loss / (gain) on financial assets

76

(21)

(101)

30

Share-based payment non-cash charges

6,776

1,421

11,237

3,750

Other operating (gain)/loss

1,553

-

3,372

-

Other non-recurring costs

-

-

-

1,229

Tax on adjustments

5,998

(613)

4,638

(644)

Adjusted net income

45,640

45,490

66,383

85,447

 

 

Note: Adjusted Net Income is a non-IFRS financial measure. As used by dLocal Adjusted net income is defined as the profit for the period (net income) excluding impairment gains/(losses) on financial assets, transaction costs, share-based payment non-cash charges, secondary offering expenses, and other operating (gain)/loss, in line with our Adjusted EBITDA calculation (see detailed methodology for Adjusted EBITDA in page 13). It further excludes the accounting non-cash charges related to the fair value gain from the Argentine dollar-linked bonds and the exchange difference loss from the intercompany loan denominated in USD that we granted to our Argentine subsidiary to purchase the bonds. In addition, it excludes the inflation adjustment based on IFRS rules for hyperinflationary economies. We believe Adjusted Net Income is a useful measure for understanding our results for operations while excluding for certain non-cash effects such as currency devaluation and inflation. Our calculation for Adjusted Net Income may differ from similarly-titled measures presented by other companies and should not be considered in isolation or as a replacement for our measure of profit for the period as presented in accordance with IFRS.

Unaudited quarterly results.

 

 


Exhibit 99.1

Earnings per share

 

We calculate basic earnings per share by dividing the profit attributable to owners of the group by the weighted average number of common shares issued and outstanding during the three-month and six-month periods ended June 30, 2024 and 2023.

 

Our diluted earnings per share is calculated by dividing the profit attributable to owners of the group of dLocal by the weighted average number of common shares outstanding during the period plus the weighted average number of common shares that would be issued on conversion of all dilutive potential common shares into common shares.

 

 

Three months ended 30 of June

Six months ended 30 of June

 

2024

2023

2024

2023

Profit attributable to common shareholders (thousands USD)

46,244

44,697

63,952

80,141

Weighted average number of common shares

293.430.253

291,700,873

294.781.316

293,403,907

Adjustments for calculation of diluted earnings per share

14.996.249

16,160,368

15.348.015

16,358,508

Weighted average number of common shares for calculating diluted earnings per share

308.426.502

307,861,241

310.129.331

309,762,415

Basic earnings per share

0.16

0.15

0.22

0.27

Diluted earnings per share

0.15

0.15

0.21

0.26

 

This press release does not contain sufficient information to constitute an interim financial report as defined in International Accounting Standards 34, “Interim Financial Reporting” nor a financial statement as defined by International Accounting Standards 1 “Presentation of Financial Statements”. The quarterly financial information in this press release has not been audited, whereas the annual results for the year ended December 31, 2023 are audited.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Exhibit 99.1

Conference call and webcast

dLocal’s management team will host a conference call and audio webcast on August 14th, 2024 at 5:00 p.m. Eastern Time. Please click here to pre-register for the conference call and obtain your dial in number and passcode.

 

The live conference call can be accessed via audio webcast at the investor relations section of dLocal’s website, at https://investor.dlocal.com/. An archive of the webcast will be available for a year following the conclusion of the conference call. The investor presentation will also be filed on EDGAR at www.sec.gov.

 

 

 

About dLocal

dLocal powers local payments in emerging markets, connecting global enterprise merchants with billions of emerging market consumers in more than 40 countries across Africa, Asia, and Latin America. Through the “One dLocal” platform (one direct API, one platform, and one contract), global companies can accept payments, send pay-outs and settle funds globally without the need to manage separate pay-in and pay-out processors, set up numerous local entities, and integrate multiple acquirers and payment methods in each market.

 


Exhibit 99.1

Definition of selected operational metrics

“API” means application programming interface, which is a general term for programming techniques that are available for software developers when they integrate with a particular service or application. In the payments industry, APIs are usually provided by any party participating in the money flow (such as payment gateways, processors, and service providers) to facilitate the money transfer process.

 

“Cross-border” means a payment transaction whereby dLocal is collecting in one currency and settling into a different currency and/or in a different geography.

 

“Local payment methods” refers to any payment method that is processed in the country where the end user of the merchant sending or receiving payments is located, which include credit and debit cards, cash payments, bank transfers, mobile money, and digital wallets.

 

“Local-to-local” means a payment transaction whereby dLocal is collecting and settling in the same currency.

 

“Net Revenue Retention Rate” or “NRR” is a U.S. dollar-based measure of retention and growth of dLocal’s merchants. NRR is calculated for a period or year by dividing the Current Period/Year Revenue by the Prior Period/Year Revenue. The Prior Period/Year Revenue is the revenue billed by us to all our customers in the prior period. The Current Period/Year Revenue is the revenue billed by us in the current period to the same customers included in the Prior Period/Year Revenue. Current Period/Year Revenue includes revenues from

any upselling and cross-selling across products, geographies, and payment methods to such merchant customers, and is net of any contractions or attrition, in respect of such merchant customers, and excludes revenue from new customers on-boarded in the preceding twelve months. As most of dLocal revenues come from existing merchants, the NRR rate is a key metric used by management, and we believe it is useful for investors in order to assess our retention of existing customers and growth in revenues from our existing customer base.

 

“Pay-in” means a payment transaction whereby dLocal’s merchant customers receive payment from their customers.

 

“Pay-out” means a payment transaction whereby dLocal disburses money in local currency to the business partners or customers of dLocal’s merchant customers.

 

“Revenue from New Merchants” means the revenue billed by us to merchant customers that we did not bill revenues in the same quarter (or period) of the prior year.

 

“Revenue from Existing Merchants” means the revenue billed by us in the last twelve months to the merchant customers that we billed revenue in the same quarter (or period) of the prior year.

 

“TPV” dLocal presents total payment volume, or TPV, which is an operating metric of the aggregate value of all payments successfully processed through dLocal’s payments platform. Because revenue depends significantly on the total value of transactions processed through the dLocal platform, management believes that TPV is an indicator of the success of dLocal’s global merchants, the satisfaction of their end users, and the scale and growth of dLocal’s business.

Rounding: We have made rounding adjustments to some of the figures included in this interim report. Accordingly, numerical figures shown as totals in some tables may not be an arithmetic aggregation of the figures that preceded them.

 

 

 


Exhibit 99.1

Forward-looking statements

This press release contains certain forward-looking statements. These forward-looking statements convey dLocal’s current expectations or forecasts of future events, including guidance in respect of total payment volume, gross profit, Adjusted EBITDA, and Adjusted EBITDA over gross profit margin. Forward-looking statements regarding dLocal and amounts stated as guidance are based on current management expectations and involve known and unknown risks, uncertainties and other factors that may cause dLocal’s actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. Certain of these risks and uncertainties are described in the “Risk Factors,” “Forward-Looking Statements” and “Cautionary Statement Regarding Forward-Looking Statements” sections of dLocal’s filings with the U.S. Securities and Exchange Commission. Unless required by law, dLocal undertakes no obligation to publicly update or revise any forward-looking statements to reflect circumstances or events after the date hereof. In addition, dLocal is unable to present a quantitative reconciliation of forward-looking guidance for Adjusted EBITDA and Adjusted EBITDA over gross profit, which are forward-looking non-IFRS measures, because dLocal cannot reliably predict certain of their necessary components, such as impairment gains/(losses) on financial assets, transaction costs, and inflation adjustment.

 


Exhibit 99.1

dLocal Limited

Certain financial information

Consolidated Condensed Interim Statements of Comprehensive Income for the three-month and six-month periods ended June 30, 2024 and 2023

(In thousands of U.S. dollars, except per share amounts)

 

 

Three months ended 30 of June

Six months ended 30 of June

 

2024

2023

2024

2023

Continuing operations

 

 

 

 

Revenues

171,279

161,138

355,709

298,425

Cost of services

(101,468)

(90,378)

(222,927)

(165,828)

Gross profit

69,811

70,760

132,782

132,597

 

 

 

 

 

Technology and development expenses

(6,408)

(2,640)

(11,873)

(4,930)

Sales and marketing expenses

(4,505)

(3,106)

(9,136)

(7,963)

General and administrative expenses

(27,074)

(17,268)

(51,406)

(32,548)

Impairment (loss)/gain on financial assets

(76)

21

101

(30)

Other operating (loss)/gain

(1,553)

-

(3,372)

-

Operating profit

30,195

47,767

57,096

87,126

Finance income

29,247

18,878

47,504

25,866

Finance costs

(1,202)

(11,419)

(19,160)

(17,016)

Inflation adjustment

(1,941)

(1,661)

(4,309)

(2,680)

Other results

26,104

5,798

24,035

6,170

Profit before income tax

56,299

53,565

81,131

93,296

Income tax expense

(10,060)

(8,774)

(17,174)

(13,055)

Profit for the period

46,239

44,791

63,957

80,241

 

 

 

 

 

Profit attributable to:

 

 

 

 

Owners of the Group

46,244

44,697

63,952

80,141

Non-controlling interest

(5)

94

5

100

Profit for the period

46,239

44,791

63,957

80,241

 

 

 

 

 

Earnings per share (in USD)

 

 

 

 

Basic Earnings per share

0.16

0.15

0.22

0.27

Diluted Earnings per share

0.15

0.15

0.21

0.26

 

 

 

 

 

Other comprehensive income

 

 

 

 

Items that may be reclassified to profit or loss:

 

 

 

 

Exchange difference on translation on foreign operations

(5,604)

1,675

(6,273)

3,163

Other comprehensive income for the period, net of tax

(5,604)

1,675

(6,273)

3,163

Total comprehensive income for the period, net of tax

40,635

46,466

57,684

83,404

 

 

 

 

 

Total comprehensive income for the period

 

 

 

 

Owners of the Group

40,642

46,371

57,678

83,305

Non-controlling interest

(7)

95

6

99

Total comprehensive income for the period

40,635

46,466

57,684

83,404

 


Exhibit 99.1

dLocal Limited

Certain financial information

Consolidated Condensed Interim Statements of Financial Position as of June 30, 2024 and December 31, 2023

(In thousands of U.S. dollars)

 

30 of June, 2024

31 of December, 2023

ASSETS

 

 

Current Assets

 

 

Cash and cash equivalents

531,620

536,160

Financial assets at fair value through profit or loss

120,297

102,677

Trade and other receivables

455,503

363,374

Derivative financial instruments

622

2,040

Other assets

10,878

11,782

Total Current Assets

1,118,920

1,016,033

 

 

 

Non-Current Assets

 

 

Financial assets at fair value through profit or loss

-

1,710

Trade and other receivables

1,787

-

Deferred tax assets

1,913

2,217

Property, plant and equipment

3,576

2,917

Right-of-use assets

3,508

3,689

Intangible assets

60,637

57,887

Other Assets

5,343

-

Total Non-Current Assets

76,764

68,420

TOTAL ASSETS

1,195,684

1,084,453

 

 

 

LIABILITIES

 

 

Current Liabilities

 

 

Trade and other payables

719,097

602,493

Lease liabilities

782

626

Tax liabilities

26,907

20,800

Derivative financial instruments

815

948

Provisions

276

362

Total Current Liabilities

747,877

625,229

 

 

 

Non-Current Liabilities

 

 

Deferred tax liabilities

2,299

753

Lease liabilities

3,106

3,331

Total Non-Current Liabilities

5,405

4,084

TOTAL LIABILITIES

753,282

629,313

 

 

 

EQUITY

 

 

Share Capital

574

591

Share Premium

173,093

173,001

Treasury Shares

(181,670)

(99,936)

Capital Reserve

32,812

21,575

Other Reserves

(14,829)

(9,808)

Retained earnings

432,307

369,608

Total Equity Attributable to owners of the Group

442,287

455,031

Non-controlling interest

115

109

TOTAL EQUITY

442,402

455,140

 


Exhibit 99.1

 

 

dLocal Limited

Certain interim financial information

Consolidated Condensed Interim Statements of Cash flows for the three-month and six-month periods ended June 30, 2024 and 2023

(In thousands of U.S. dollars)

 

Three months ended 30 of June

Six months ended 30 of June

 

2024

2023

2024

2023

Cash flows from operating activities

 

 

 

 

Profit before income tax

56,299

53,565

81,131

93,296

Adjustments:

 

 

 

 

Interest income from financial instruments

(6,473)

(15,313)

(13,915)

(22,212)

Interest charges for lease liabilities

44

52

87

95

Other finance expense

1,673

765

1,800

1,202

Finance expense related to derivative financial instruments

2,446

4,634

12,324

9,869

Net exchange differences

(1,469)

3,551

6,168

4,082

Fair value gain on financial assets at fair value through profit or loss

(22,774)

(3,565)

(33,589)

(3,654)

Amortization of Intangible assets

3,690

2,492

7,114

4,668

Depreciation of Property, plant and equipment and right-of-use

410

377

737

716

Disposals of property, plant and equipment, intangible assets and right-of-use asset

(62)

-

11

-

Share-based payment expense, net of forfeitures

6,776

1,421

11,237

3,750

Other operating loss/(gain)

1,553

-

3,372

-

Net Impairment loss/(gain) on financial assets

76

(21)

(101)

30

Inflation adjustment

(5,982)

-

(11,874)

-

 

36,207

47,957

64,502

91,842

Changes in working capital

 

 

 

 

Increase in Trade and other receivables

(69,322)

(50,312)

(102,158)

(59,386)

Decrease/(increase) in Other assets

(716)

(1,597)

2,503

12,157

Increase in Trade and other payables

67,268

148,761

113,232

190,139

Decrease in Tax Liabilities

8,870

(2,279)

7,750

(3,341)

Decrease/(increase) in Provisions

(90)

(252)

(86)

(557)

Cash from operating activities

42,218

142,278

85,743

230,854

Income tax paid

(13,409)

(2,774)

(16,967)

(6,816)

Net cash from operating activities

28,808

139,504

68,776

224,038

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

Acquisitions of Property, plant and equipment

(440)

(608)

(1,226)

(657)

Additions of Intangible assets

(4,842)

(4,339)

(9,864)

(8,145)

Acquisitions of financial assets at FVTPL

(96,841)

(48,139)

(96,841)

(48,139)

Net collections/acquisitions of financial assets at FVPL

98,544

478

98,301

1,523

Interest collected from financial instruments

6,473

15,155

13,915

21,975

Net cash used in investing activities

2,894

(37,453)

4,285

(33,443)

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Repurchase of shares

(81,751)

(61,011)

(81,751)

(97,929)

Share-options exercise

92

84

92

153

Interest payments on lease liability

(44)

(52)

(87)

(95)

Principal payments on lease liability

26

(146)

(69)

(276)

Finance expense paid related to derivative financial instruments

(888)

(9,184)

(11,039)

(11,337)

Other finance expense paid

(272)

(768)

(399)

(1,205)

Net cash (used in) / provided by financing activities

(82,837)

(71,077)

(93,253)

(110,689)

Net increase in cash flow

(51,135)

30,975

(20,192)

79,906

 

 

 

 

 

Cash and cash equivalents at the beginning of the period

572,357

517,892

536,160

468,092

Net increase in cash flow

(51,135)

30,975

(20,192)

79,906

Effects of exchange rate changes on cash and cash equivalents

10,398

519

15,652

1,388

Cash and cash equivalents at the end of the period

531,620

549,386

531,620

549,386

 


Exhibit 99.1

Investor Relations Contact:

investor@dlocal.com

 

Media Contact:

media@dlocal.com


 

Exhibit 99.2

 

 

 

DLocal Limited

Unaudited Consolidated Condensed Interim Financial Statements as of June 30, 2024 and for the six-month and three-month periods ended June 30, 2024 and 2023

 

 


 

DLocal Limited

Unaudited Consolidated Condensed Interim Statements of Comprehensive Income

For the six-month and three-month periods ended June 30, 2024 and 2023

(All amounts in thousands of U.S. Dollars except share data or as otherwise indicated)

 

 

 

 

 

Six months ended

 

 

Three months ended

 

 

Notes

 

June 30, 2024

 

 

June 30, 2023

 

 

June 30, 2024

 

 

June 30, 2023

 

Continuing operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

6

 

 

355,709

 

 

 

298,425

 

 

 

171,279

 

 

 

161,138

 

Cost of services

 

6

 

 

(222,927

)

 

 

(165,828

)

 

 

(101,468

)

 

 

(90,378

)

Gross profit

 

 

 

 

132,782

 

 

 

132,597

 

 

 

69,811

 

 

 

70,760

 

Technology and development expenses

 

7

 

 

(11,873

)

 

 

(4,930

)

 

 

(6,408

)

 

 

(2,640

)

Sales and marketing expenses

 

8

 

 

(9,136

)

 

 

(7,963

)

 

 

(4,505

)

 

 

(3,106

)

General and administrative expenses

 

8

 

 

(51,406

)

 

 

(32,548

)

 

 

(27,074

)

 

 

(17,268

)

Impairment reversal on financial assets

 

16

 

 

101

 

 

 

(30

)

 

 

(76

)

 

 

21

 

Other operating loss

 

 

 

 

(3,372

)

 

 

 

 

 

(1,553

)

 

 

 

Operating profit

 

 

 

 

57,096

 

 

 

87,126

 

 

 

30,195

 

 

 

47,767

 

Finance income

 

11

 

 

47,504

 

 

 

25,866

 

 

 

29,247

 

 

 

18,878

 

Finance costs

 

11

 

 

(19,160

)

 

 

(17,016

)

 

 

(1,202

)

 

 

(11,419

)

Inflation adjustment

 

11

 

 

(4,309

)

 

 

(2,680

)

 

 

(1,941

)

 

 

(1,661

)

Other results

 

 

 

 

24,035

 

 

 

6,170

 

 

 

26,104

 

 

 

5,798

 

Profit before income tax

 

 

 

 

81,131

 

 

 

93,296

 

 

 

56,299

 

 

 

53,565

 

Income tax expense

 

12

 

 

(17,174

)

 

 

(13,055

)

 

 

(10,060

)

 

 

(8,774

)

Profit for the period

 

 

 

 

63,957

 

 

 

80,241

 

 

 

46,239

 

 

 

44,791

 

Profit attributable to:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Owners of the Group

 

 

 

 

63,952

 

 

 

80,141

 

 

 

46,244

 

 

 

44,697

 

Non-controlling interest

 

 

 

 

5

 

 

 

100

 

 

 

(5

)

 

 

94

 

Profit for the period

 

 

 

 

63,957

 

 

 

80,241

 

 

 

46,239

 

 

 

44,791

 

Earnings per share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic Earnings per share

 

14

 

 

0.22

 

 

 

0.27

 

 

 

0.16

 

 

 

0.15

 

Diluted Earnings per share

 

14

 

 

0.21

 

 

 

0.26

 

 

 

0.15

 

 

 

0.15

 

Other comprehensive Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Items that may be reclassified to profit or loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exchange difference on translation on foreign operations

 

 

 

 

(6,273

)

 

 

3,163

 

 

 

(5,604

)

 

 

1,675

 

Other comprehensive income for the period, net of tax

 

 

 

 

(6,273

)

 

 

3,163

 

 

 

(5,604

)

 

 

1,675

 

Total comprehensive income for the period

 

 

 

 

57,684

 

 

 

83,404

 

 

 

40,635

 

 

 

46,466

 

Total comprehensive income for the period is attributable to:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Owners of the Group

 

 

 

 

57,678

 

 

 

83,305

 

 

 

40,642

 

 

 

46,371

 

Non-controlling interest

 

 

 

 

6

 

 

 

99

 

 

 

(7

)

 

 

95

 

Total comprehensive income for the period

 

 

 

 

57,684

 

 

 

83,404

 

 

 

40,635

 

 

 

46,466

 

 

The accompanying notes are an integral part of these Unaudited Consolidated Condensed Interim Financial Statements.

 


 

DLocal Limited

Unaudited Consolidated Condensed Interim Statements of Financial Position

As of June 30, 2024 and December 31, 2023

(All amounts in thousands of U.S. Dollars except share data or as otherwise indicated)

 

 

Notes

 

June 30, 2024

 

December 31, 2023

ASSETS

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash and cash equivalents

 

15

 

531,620

 

536,160

Financial assets at fair value through profit or loss

 

16

 

120,297

 

102,677

Trade and other receivables

 

17

 

455,503

 

363,374

Derivative financial instruments

 

22

 

622

 

2,040

Other assets

 

18

 

10,878

 

11,782

Total Current Assets

 

 

 

1,118,920

 

1,016,033

Non-Current Assets

 

 

 

 

 

 

Financial assets at fair value through profit or loss

 

 

 

 

1,710

Trade and other receivables

 

 

 

1,787

 

Deferred tax assets

 

 

 

1,913

 

2,217

Property, plant and equipment

 

 

 

3,576

 

2,917

Right-of-use assets

 

 

 

3,508

 

3,689

Intangible assets

 

19

 

60,637

 

57,887

Other assets

 

18

 

5,343

 

Total Non-Current Assets

 

 

 

76,764

 

68,420

TOTAL ASSETS

 

 

 

1,195,684

 

1,084,453

LIABILITIES

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

Trade and other payables

 

20

 

719,097

 

602,493

Lease liabilities

 

 

 

782

 

626

Tax liabilities

 

21

 

26,907

 

20,800

Derivative financial instruments

 

22

 

815

 

948

Provisions

 

23

 

276

 

362

Total Current Liabilities

 

 

 

747,877

 

625,229

Non-Current Liabilities

 

 

 

 

 

 

Deferred tax liabilities

 

 

 

2,299

 

753

Lease liabilities

 

 

 

3,106

 

3,331

Total Non-Current Liabilities

 

 

 

5,405

 

4,084

TOTAL LIABILITIES

 

 

 

753,282

 

629,313

EQUITY

 

14

 

 

 

 

Share Capital

 

 

 

574

 

591

Share Premium

 

 

 

173,093

 

173,001

Treasury Shares

 

 

 

(181,670)

 

(99,936)

Capital Reserve

 

 

 

32,812

 

21,575

Other Reserves

 

 

 

(14,829)

 

(9,808)

Retained earnings

 

 

 

432,307

 

369,608

Total Equity Attributable to owners of the Group

 

 

 

442,287

 

455,031

Non-controlling interest

 

 

 

115

 

109

TOTAL EQUITY

 

 

 

442,402

 

455,140

TOTAL LIABILITIES AND EQUITY

 

 

 

1,195,684

 

1,084,453

 

The accompanying notes are an integral part of these Unaudited Consolidated Condensed Interim Financial Statement.

 


 

DLocal Limited

Unaudited Consolidated Condensed Interim Statements of Changes in Equity

For the six-month period ended June 30, 2024 and 2023

(All amounts in thousands of U.S. Dollars except share data or as otherwise indicated)

 

 

Notes

 

Share
Capital

 

Share
Premium

 

Treasury shares

 

Capital
Reserve

 

Other Reserves

 

Retained
Earnings

 

Total

 

Non-
controlling
interest

 

Total
equity

Balance as of January 1st, 2024

 

 

 

591

 

173,001

 

(99,936)

 

21,575

 

(9,808)

 

369,608

 

455,031

 

109

 

455,140

Comprehensive Income for the period

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit for the period

 

 

 

 

 

 

 

 

63,952

 

63,952

 

5

 

63,957

Exchange difference on translation on foreign operations

 

 

 

 

 

 

 

(5,021)

 

(1,253)

 

(6,274)

 

1

 

(6,273)

Total Comprehensive Income for the period

 

 

 

 

 

 

 

(5,021)

 

62,699

 

57,678

 

6

 

57,684

Transactions with Group owners in their capacity as owners

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-options exercise

 

14

 

 

92

 

 

 

 

 

92

 

 

92

Share-based payments net of forfeitures

 

9

 

 

 

 

11,237

 

 

 

11,237

 

 

11,237

Repurchase of shares

 

14

 

(17)

 

 

(81,734)

 

 

 

 

(81,751)

 

 

(81,751)

Transactions with Group owners in their capacity as owners

 

 

 

(17)

 

92

 

(81,734)

 

11,237

 

 

 

(70,422)

 

 

(70,422)

Balance as of June 30, 2024

 

 

 

574

 

173,093

 

(181,670)

 

32,812

 

(14,829)

 

432,307

 

442,287

 

115

 

442,402

Balance as of January 1st, 2023

 

 

 

592

 

166,328

 

(2,021)

 

16,185

 

(1,448)

 

219,993

 

399,629

 

(9)

 

399,620

Comprehensive Income for the period

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit for the period

 

 

 

 

 

 

 

 

80,141

 

80,141

 

100

 

80,241

Exchange difference on translation on foreign operations

 

 

 

 

 

 

 

1,442

 

1,722

 

3,164

 

(1)

 

3,163

Total Comprehensive Income for the period

 

 

 

 

 

 

 

1,442

 

81,863

 

83,305

 

99

 

83,404

Transactions with Group owners in their capacity as owners

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-options exercise

 

14

 

 

2,158

 

 

(2,005)

 

 

 

153

 

 

153

Forfeitures

 

14

 

 

 

 

 

 

 

 

 

Share-based payments

 

9

 

 

 

 

3,750

 

 

 

3,750

 

 

3,750

Repurchase of shares

 

 

 

(14)

 

 

(97,915)

 

 

 

 

(97,929)

 

 

(97,929)

Transactions with Group owners in their capacity as owners

 

 

 

(14)

 

2,158

 

(97,915)

 

1,745

 

 

 

(94,026)

 

 

(94,026)

Balance as of June 30, 2023

 

 

 

578

 

168,486

 

(99,936)

 

17,930

 

(6)

 

301,856

 

388,908

 

90

 

388,998

 

The accompanying notes are an integral part of these Unaudited Consolidated Condensed Interim Financial Statements.

 


 

DLocal Limited

Unaudited Consolidated Condensed Interim Statements of Cash Flows

For the six-month periods ended June 30, 2024 and 2023

(All amounts in thousands of U.S. Dollars except share data or as otherwise indicated)

 

 

 

 

 

Six months ended

 

Notes

 

June 30, 2024

 

June 30, 2023

Cash flows from operating activities

 

 

 

 

 

 

Profit before income tax

 

 

 

81,131

 

93,296

Adjustments:

 

 

 

 

 

 

Interest (Income) from financial instruments

 

11

 

(13,915)

 

(22,212)

Interest charges for lease liabilities

 

11

 

87

 

95

Other finance expense

 

 

 

1,800

 

1,202

Finance expense related to derivative financial instruments

 

 

 

12,324

 

9,869

Net exchange differences

 

 

 

6,168

 

4,082

Fair value gain on financial assets at fair value through profit or loss

 

11

 

(33,589)

 

(3,654)

Amortization of Intangible assets

 

10

 

7,114

 

4,668

Depreciation of Property, plant and equipment and Right-of-use asset

 

10

 

737

 

716

Disposal of Right-of-use asset

 

10

 

11

 

Share-based payment expense, net of forfeitures

 

9

 

11,237

 

3,750

Other operating loss

 

 

 

3,372

 

Net Impairment loss/(gain) on financial assets

 

16

 

(101)

 

30

Inflation adjustment

 

 

 

(11,874)

 

 

 

 

64,502

 

91,842

Changes in working capital

 

 

 

 

 

 

Increase in Trade and other receivables

 

17

 

(102,158)

 

(59,386)

Decrease in Other assets

 

18

 

2,503

 

12,157

Increase in Trade and other payables

 

20

 

113,232

 

190,139

Increase/(Decrease) in Tax Liabilities

 

21

 

7,750

 

(3,341)

Decrease in Provisions

 

23

 

(86)

 

(557)

Cash from operating activities

 

 

 

85,743

 

230,854

Income tax paid

 

 

 

(16,967)

 

(6,816)

Net cash from operating activities

 

 

 

68,776

 

224,038

Cash flows from investing activities

 

 

 

 

 

 

Acquisitions of Property, plant and equipment

 

 

 

(1,226)

 

(657)

Additions of Intangible assets

 

19

 

(9,864)

 

(8,145)

Acquisition of financial assets at FVPL

 

 

 

(96,841)

 

(48,139)

Net collections of financial assets at FVPL

 

 

 

98,301

 

1,523

Interest collected from financial instruments

 

 

 

13,915

 

21,975

Net cash used in investing activities

 

 

 

4,285

 

(33,443)

Cash flows from financing activities

 

 

 

 

 

 

Repurchase of shares

 

14

 

(81,751)

 

(97,929)

Share-options exercise

 

 

 

92

 

153

Interest payments on lease liability

 

 

 

(87)

 

(95)

Principal payments on lease liability

 

 

 

(69)

 

(276)

Finance expense paid related to derivative financial instruments

 

 

 

(11,039)

 

(11,337)

Other finance expense paid

 

 

 

(399)

 

(1,205)

Net cash (used in)/provided by financing activities

 

 

 

(93,253)

 

(110,689)

Net increase in cash flow

 

 

 

(20,192)

 

79,906

Cash and cash equivalents at the beginning of the period

 

 

 

536,160

 

468,092

Effects of exchange rate changes and inflation on cash and cash equivalents

 

 

 

15,652

 

1,388

Cash and cash equivalents at the end of the period

 

 

 

531,620

 

549,386

 

The accompanying notes are an integral part of these Unaudited Consolidated Condensed Interim Financial Statements.

 


 

DLocal Limited

Notes to Unaudited Consolidated Condensed Interim Financial Statements

At June 30, 2024

(All amounts in thousands of U.S. Dollars except share data or as otherwise indicated)

 

 

1. General information and Significant Events during the period

 

1.1. General information

 

DLocal Limited (“dLocal” or the “Company”) was established on October 5, 2016 as a limited liability holding company in Malta (together with its subsidiaries as the “Group”.) On April 14, 2021 the Group was reorganized under dLocal and domiciled and incorporated in the Cayman Islands. The Company holds a controlling financial interest in the Group.

 

The Group processes payment transactions, enabling merchants located in developed economies (mainly United States, Europe and China) to receive payments (“pay-ins”) from customers in emerging markets and to facilitate payments (“pay-outs”) to customers in emerging markets. As of the date these Unaudited Consolidated Condensed Interim Financial Statements were issued, the Group continued to focus on its geographic expansion, increasing the total number of in-network countries.

 

The Group processes local payments in emerging markets through its network of acquirers and payments processors. Through its partnership with financial institutions, the Group expatriates/repatriates funds to/from developed economies where the merchant customers elect settlement in their preferred currency (mainly U.S. Dollar and Euro). These unaudited consolidated condensed interim financial statements include dLocal’s subsidiaries.

The Group is licensed and regulated in the EU as an Electronic Money Issuer, or EMI, and Payment Institution, or PI, and registered as a Money Service Business with the Financial Crimes Enforcement Network of the U.S. Department of the Treasury, or FinCEN, and operates and may be licensed, as applicable, in many countries in emerging markets, primarily in the Americas, Asia and Africa.

In addition, the Group is subject to laws aimed at preventing money laundering, corruption and the financing of terrorism. This regulatory landscape is constantly changing, including as a consequence of the implementation of the Fifth Anti-Money Laundering Directive (Directive (EU) 2018/843, “MLD5”) and the proposed amendments to the MLD4, often referred to as the fourth Anti-Money Laundering Directive.

 

1.2. Significant events during the period


a)
Class action lawsuits

 

On February 23 and February 28, 2023, respectively, we were named, along with several of our senior executives and/or directors, as defendants in certain putative class action lawsuits filed in the Supreme Court of the State of New York, New York County, asserting claims under Sections 11, 12, and 15 of the Securities Act of 1933, based in significant part on the short-seller report. These matters, Zappia et al. v. DLocal Limited et al., Index No. 151778/2023 (Sup. Ct. N.Y. Cty.), and Hunt et al. v. DLocal Limited et al., Index No. 651058/2023 (Sup. Ct. N.Y. Cty.), or the Zappia and Hunt Actions, allege, among other things, that the registration statement for our June 2021 initial public offering reflected certain material misstatements or omissions.

 


 

On March 3, 2023, plaintiffs in the two actions filed a stipulation and proposed order consolidating the cases and appointing putative lead counsel. The parties also agreed to a schedule for plaintiffs’ filing of an amended complaint and a subsequent briefing schedule for a motion to dismiss the amended complaint.

 

On May 12, 2023, plaintiffs in the Zappia and Hunt Actions jointly filed a consolidated amended complaint. On July 11, 2023, we filed a motion to dismiss the complaint. Plaintiffs filed their opposition brief on August 15, 2023, and we filed a reply in further support of our motion to dismiss on September 22, 2023. Our motion to dismiss is now fully briefed, and, on February 29, 2024, the court presided over oral argument on the motion. The court has not yet issued a decision on the motion, and no other proceedings are currently ongoing or scheduled.

 

We have also been named, along with several of our senior executives and/or directors, in a putative class action lawsuit filed in the U.S. District Court for the Eastern District of New York, asserting claims under Sections 11 and 15 of the Securities Act and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as well as Rule 10b-5 promulgated thereunder. This lawsuit, captioned Laurenzi v. dLocal Ltd., et al., 1:23-cv-07501 (E.D.N.Y.) (Laurenzi Action), was initiated on October 6, 2023. On January 4, 2024, the Court appointed a Lead Plaintiff. On March 18, 2024, Lead Plaintiff filed an amended class action complaint. The amended complaint alleges misstatements and omissions in the registration statement for our June 2021 initial public offering and in various public filings and press releases during the period of June 2, 2021 through June 5, 2023. Pursuant to a schedule agreed upon with Lead Plaintiff’s counsel, we filed on April 30, 2024, a letter, as required by court rules, requesting a pre-motion conference regarding an anticipated motion to dismiss the Laurenzi Action in full. Lead Plaintiff responded to that letter on May 14, 2024. On June 10, 2024, the court held the requested preliminary conference and set a schedule for briefing on our motion to dismiss. We served our opening brief on August 9, 2024, Lead Plaintiff’s opposition is due on October 11, 2024, and our reply is due on November 8, 2024.

Due to the preliminary posture of the above-described lawsuits as of the date of issuance of these unaudited consolidated condensed interim financial statements, the Management and its legal advisors are unable to evaluate the likelihood of an adverse outcome or estimate a range of potential losses and no provision for contingencies have been recorded for the aforementioned matters. DLocal Limited intends to defend itself vigorously in these actions. As of the date of issuance of the Company’s unaudited interim financial statements there were no further updates in this regard.

 

Developments in Argentina
 

Argentina is subject to extensive foreign exchange regulations which were revised as recently as December 2023. We and our legal advisors consider our activities to be carried out in compliance with applicable laws and regulations, including compliance with foreign exchange market and tax regulations. As of the date of this unaudited interim report, no provision for contingencies has been recorded for the aforementioned matters.


 

 

 

 


 

2. Presentation and preparation of the Consolidated Condensed Interim Financial Statements and significant accounting policies

 

2.1. Basis of preparation of consolidated condensed interim financial information

 

These Unaudited Consolidated Condensed Interim Financial Statements for the six months ended June 30, 2024 have been prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting” as issued by the International Accounting Standard Board.

 

These Unaudited Consolidated Condensed Interim Financial Statements do not include all the notes of the type normally included in an annual consolidated financial statement. Accordingly, this report should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2023 (the “Annual Financial Statements”).

 

The accounting policies and critical accounting estimates and judgments adopted, except for those explicitly indicated on these Unaudited Consolidated Condensed Interim Financial Statements, are consistent with those of the previous financial year and corresponding interim reporting period.

 

All amounts are presented in thousands of U.S. Dollars except share data or as otherwise indicated.

 

These Unaudited Consolidated Condensed Interim Financial Statements for the six months ended June 30, 2024 were authorized for issuance by the dLocal’s Board of Directors on August 13, 2024.

 

2.2. Changes in accounting policies adopted by the Group

 

Treasury shares

 

As of June 30, 2024, the Group has adopted a voluntary change in the accounting policy regarding the classification of treasury shares to better reflect the Group’s equity structure. Previously, treasury shares were recognized under the share premium in the equity. As part of the new policy, and in connection with the repurchase of shares mentioned in note 14 c, the Group has decided to classify treasury shares separately in the equity position.

 

Treasury shares are recorded at cost, which includes the purchase price and any directly attributable costs of acquisition. The cost of treasury shares is presented as a deduction from equity, specifically within the “Treasury Shares” reserve. No gain or loss is recognized in the income statement on the purchase, sale, issue, or cancellation of the company’s own equity instruments.

 

2.3. New accounting pronouncements

 

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group’s annual consolidated financial statements for the year ended 31 December 2023. The Company evaluated and, when necessary, applied for the first time the new standards and interpretations issued or modified by the IASB as demonstrated in the item 2.4, and did not identify any significant impacts thereof on the disclosure or reported amounts.

 

2.4. Impact of IFRS Accounting Standards issued but not yet applied by the Group

 

The following new standards, amendments to standards and interpretation of IFRS issued by the IASB were not adopted since they are not effective for the issuance of the interim condensed consolidated financial statements. The Company plans to adopt these new standards, amendments, and interpretation, if applicable, when they become effective.

 

IAS 21 - The effects of changes in Foreign Exchange Rates (effective on January 01, 2025)

In August 2023, the IASB amended IAS 21 to help entities to determine whether a currency is exchangeable into another currency, and which spot exchange rate to use when it is not. These new requirements will apply for annual reporting periods beginning on or after 1 January 2025. The Company is assessing the impact of the standard.

 


 

 

IFRS 18 - Presentation and disclosure in financial statements (effective on January 01, 2027)

On 9 April 2024, the IASB issued a new standard IFRS 18, the new standard on presentation and disclosure in financial statements, with a focus on updates to the statement of profit or loss. The key new concepts introduced in IFRS 18 relate to:

 

• the structure of the statement of profit or loss;

• required disclosures in the financial statements for certain profit or loss performance measures that are reported outside an entity’s financial statements (that is, management-defined performance measures); and

• enhanced principles on aggregation and disaggregation which apply to the primary financial statements and notes in general.

 

IFRS 18 will replace IAS 1; many of the other existing principles in IAS 1 are retained, with limited changes. IFRS 18 will not impact the recognition or measurement of items in the financial statements, but it might change what an entity reports as its ‘operating profit or loss’.

 

IFRS 18 will apply for reporting periods beginning on or after 1 January 2027 and also applies to comparative information.

 

IFRS 9 – Financial Instruments and IFRS 07 Financial Instruments: Disclosure (effective on January 1, 2026)

 

On 30 May 2024, the IASB issued target amendments to IFRS 9 and IFRS 7. The amendments intend to: