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 November 2022
Commission File Number: 001-38353
PagSeguro
Digital Ltd.
(Name
of Registrant)
Conyers Trust Company (Cayman) Limited,
Cricket Square, Hutchins Drive, P.O. Box 2681,
Grand Cayman, KY1-1111, Cayman Islands
(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 ☒
PagSeguro Digital Ltd.
Unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month
periods ended September 30, 2022 and 2021
Contents
Unaudited condensed consolidated interim financial
statements
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2
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investors.pagseguro.com |
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PagSeguro Digital Ltd. |
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Unaudited condensed consolidated interim balance sheet
As of September 30, 2022 and December 31, 2021
(All amounts in thousands of reais) |
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Note |
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September 30, 2022 |
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December 31, 2021 |
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Assets |
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Current assets |
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|
|
|
Cash and cash equivalents |
5 |
|
1,404,519 |
|
1,794,362 |
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Financial investments |
6 |
|
1,073,816 |
|
782,647 |
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Accounts receivable |
7 |
|
34,569,772 |
|
23,428,522 |
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Inventories |
|
|
52,062 |
|
49,537 |
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Tax receivable |
8 |
|
460,248 |
|
469,490 |
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Other receivables |
|
|
148,878 |
|
194,776 |
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Total current assets |
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37,709,295 |
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26,719,334 |
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Non-current assets |
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Accounts receivable |
7 |
|
731,360 |
|
228,880 |
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Judicial deposits |
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|
44,062 |
|
40,224 |
|
Deferred income tax and social contribution |
19 |
|
102,952 |
|
120,762 |
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Other receivables |
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|
15,591 |
|
11,710 |
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Investment |
|
|
1,574 |
|
15,666 |
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Property and equipment |
11 |
|
2,671,757 |
|
2,289,052 |
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Intangible assets |
12 |
|
1,999,296 |
|
1,650,176 |
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Total non-current assets |
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5,566,592 |
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4,356,470 |
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Total assets |
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43,275,887 |
|
31,075,804 |
The accompanying notes are an integral part of these unaudited
condensed consolidated interim financial statements.
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3
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investors.pagseguro.com |
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PagSeguro Digital Ltd. |
|
Unaudited condensed consolidated interim balance sheet
As of September 30, 2022 and December 31, 2021
(All amounts in thousands of reais) |
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Note |
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September 30, 2022 |
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December 31, 2021 |
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Liabilities and equity |
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Current Liabilities
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Payables to third parties |
13 |
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14,947,305 |
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13,217,150 |
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Deposits |
14 |
|
10,795,295 |
|
3,056,444 |
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Borrowings |
18 |
|
986,695 |
|
1,005,787 |
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Derivative Financial Instruments |
26 |
|
157,013 |
|
14,317 |
|
Trade payables |
|
|
371,730 |
|
578,004 |
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Payables to related parties |
9 |
|
450,987 |
|
543,621 |
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Salaries and social security charges |
15 |
|
300,759 |
|
259,724 |
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Taxes and contributions |
16 |
|
73,467 |
|
63,934 |
|
Provision for contingencies |
17 |
|
42,782 |
|
27,653 |
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Deferred revenue |
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131,887 |
|
162,566 |
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Other liabilities |
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|
28,922 |
|
73,719 |
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Total current liabilities |
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28,286,842 |
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19,002,919 |
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Non-current liabilities |
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Deposits |
14 |
|
1,843,401 |
|
77,552 |
|
Deferred income tax and social contribution |
19 |
|
1,530,326 |
|
1,391,760 |
|
Provision for contingencies |
17 |
|
14,526 |
|
13,910 |
|
Deferred revenue |
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|
19,106 |
|
17,300 |
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Other liabilities |
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|
70,058 |
|
70,165 |
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Total non-current liabilities |
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3,477,417 |
|
1,570,687 |
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Total liabilities |
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31,764,259 |
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20,573,606 |
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Equity |
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Share capital |
20 |
|
26 |
|
26 |
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Treasury shares |
20 |
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(376,598) |
|
(285,011) |
|
Capital reserve |
20 |
|
6,089,360 |
|
6,076,286 |
|
Retained earnings |
20 |
|
5,829,755 |
|
4,732,624 |
|
Equity valuation adjustments |
20 |
|
(22,373) |
|
(22,372) |
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Other comprehensive income |
20 |
|
(8,543) |
|
645 |
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Total equity |
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11,511,628 |
|
10,502,198 |
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Total liabilities and equity |
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43,275,887 |
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31,075,804 |
The accompanying notes are an integral part of these unaudited
condensed consolidated interim financial statements.
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4
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investors.pagseguro.com |
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PagSeguro Digital Ltd. |
|
Unaudited condensed consolidated interim statement of income
For the three and nine-month periods ended September 30, 2022 and
2021
(All amounts in thousands of reais, unless otherwise
stated) |
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Three-month period |
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Nine-month period |
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Note |
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September 30, 2022 |
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September 30, 2021 |
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September 30, 2022 |
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September 30, 2021 |
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Revenue from transaction activities and other services |
22 |
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2,292,079 |
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1,792,161 |
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6,602,349 |
|
4,725,259 |
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Financial income |
22 |
|
1,697,222 |
|
937,743 |
|
4,638,118 |
|
2,381,336 |
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Other financial income |
22 |
|
46,126 |
|
45,861 |
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132,469 |
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105,969 |
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Total revenue and income |
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4,035,427 |
|
2,775,765 |
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11,372,936 |
|
7,212,564 |
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Cost of sales and services |
23 |
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(1,862,164) |
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(1,502,018) |
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(5,501,843) |
|
(3,943,121) |
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Selling expenses |
23 |
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(530,840) |
|
(367,893) |
|
(1,510,591) |
|
(1,099,775) |
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Administrative expenses |
23 |
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(185,343) |
|
(273,029) |
|
(554,611) |
|
(687,998) |
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Financial expenses |
23 |
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(920,656) |
|
(209,823) |
|
(2,296,843) |
|
(387,995) |
|
Other income (expenses), net |
23 |
|
(111,123) |
|
(1,821) |
|
(224,564) |
|
26,034 |
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Profit before income taxes |
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|
425,301 |
|
421,181 |
|
1,284,484 |
|
1,119,709 |
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|
|
|
|
|
|
|
|
|
|
|
Current income tax and social contribution |
19 |
|
1,603 |
|
(7,652) |
|
(26,518) |
|
(29,290) |
|
Deferred income tax and social contribution |
19 |
|
(46,617) |
|
(91,983) |
|
(160,835) |
|
(225,403) |
|
|
|
|
|
|
|
|
|
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|
Income tax and social contribution |
|
|
(45,014) |
|
(99,635) |
|
(187,353) |
|
(254,693) |
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|
|
|
|
|
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|
Net income for the period |
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|
380,287 |
|
321,546 |
|
1,097,131 |
|
865,016 |
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|
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Attributable to: |
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Equity holders of the parent
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|
380,287 |
|
321,393 |
|
1,097,131 |
|
864,706 |
|
Non-controlling interests
|
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|
— |
|
153 |
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— |
|
310 |
|
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Basic earnings per common share - R$ |
21 |
|
1,1639 |
|
0,9727 |
|
3,3501 |
|
2,6188 |
|
Diluted earnings per common share - R$ |
21 |
|
1,1562 |
|
0,9669 |
|
3,3285 |
|
2,6019 |
The accompanying notes are an integral part of these unaudited
condensed consolidated interim financial statements.
|
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5
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|
investors.pagseguro.com |
|
|
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|
|
PagSeguro Digital Ltd. |
|
Unaudited condensed consolidated interim statement of comprehensive
income
For the three and nine-month periods ended September 30, 2022 and
2021
(All amounts in thousands of reais) |
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|
Three-month period |
|
Nine-month period |
|
|
September 30, 2022 |
|
September 30, 2021 |
|
September 30, 2022 |
|
September 30, 2021 |
|
|
|
|
|
|
|
|
|
|
Net income for the period |
|
380,287 |
|
321,546 |
|
1,097,131 |
|
865,016 |
|
Other comprehensive income that may be reclassified to the
statement of income in subsequent periods |
|
|
|
|
|
|
|
|
|
Currency translation adjustment |
|
1 |
|
220 |
|
(717) |
|
(284) |
|
Loss on investments designated at fair value through
OCI |
|
662 |
|
221 |
|
249 |
|
561 |
|
Derivative Financial Instruments through OCI |
|
3,969 |
|
— |
|
(13,084) |
|
— |
|
Income tax and social contribution |
|
(1,574) |
|
(75) |
|
4,364 |
|
(191) |
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income for the period |
|
383,345 |
|
321,912 |
|
1,087,943 |
|
865,102 |
|
|
|
|
|
|
|
|
|
|
|
Attributable to |
|
|
|
|
|
|
|
|
|
Equity holders of the parent |
|
383,344 |
|
321,759 |
|
1,087,942 |
|
864,792 |
|
Non-controlling interests |
|
— |
|
153 |
|
— |
|
310 |
|
Net income for the period
|
|
383,344 |
|
321,912 |
|
1,087,942 |
|
865,102 |
The accompanying notes are an integral part of these unaudited
condensed consolidated interim financial statements.
|
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|
6
|
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|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Unaudited condensed consolidated interim statement of changes in
equity
For the nine-month period ended September 30, 2022 and 2021
(All amounts in thousands of reais) |
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Capital reserve |
|
Profit reserve |
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Note |
|
Share capital |
|
Treasury shares |
|
Capital reserve |
|
Share-based long-term incentive plan (LTIP) |
|
Retained earnings |
|
Equity valuation adjustments |
|
Other comprehensive income |
|
Total |
|
Non-controlling interests |
|
Total equity |
|
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|
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|
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|
|
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|
On December 31, 2020 |
|
|
|
26 |
|
(13,609) |
|
5,690,089 |
|
94,199 |
|
3,566,522 |
|
(22,372) |
|
491 |
|
9,315,346 |
|
12,113 |
|
9,327,459 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
Net income for the period |
|
|
|
— |
|
— |
|
— |
|
— |
|
864,706 |
|
— |
|
— |
|
864,706 |
|
310 |
|
865,016 |
|
Currency translation adjustment |
|
|
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(284) |
|
(284) |
|
— |
|
(284) |
|
Gain on financial assets through other OCI |
|
|
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
370 |
|
370 |
|
— |
|
370 |
|
Shares issued |
|
|
|
— |
|
— |
|
138,665 |
|
(138,665) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
Share based long term incentive plan (LTIP) |
|
|
|
— |
|
— |
|
— |
|
264,232 |
|
— |
|
— |
|
— |
|
264,232 |
|
— |
|
264,232 |
|
(LTIP) of treasury shares |
|
|
|
— |
|
13,410 |
|
— |
|
(13,410) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
On September 30, 2021 |
|
|
|
26 |
|
(199) |
|
5,828,754 |
|
206,355 |
|
4,431,228 |
|
(22,372) |
|
577 |
|
10,444,370 |
|
12,423 |
|
10,456,793 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income for the period |
|
|
|
— |
|
— |
|
— |
|
— |
|
301,396 |
|
— |
|
— |
|
301,396 |
|
(128) |
|
301,268 |
|
Currency translation adjustment |
|
|
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
167 |
|
167 |
|
— |
|
167 |
|
Loss on financial assets through OCI |
|
|
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(99) |
|
(99) |
|
(12,295) |
|
(12,394) |
|
Non-controlling |
|
|
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
Shares issued |
|
|
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
Share based long term incentive plan (LTIP) |
|
|
|
— |
|
— |
|
— |
|
41,176 |
|
— |
|
— |
|
— |
|
41,176 |
|
— |
|
41,176 |
|
Acquisition of treasury shares |
|
|
|
— |
|
(284,812) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(284,812) |
|
— |
|
(284,812) |
|
(LTIP) of treasury shares |
|
|
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
On December 31, 2021 |
|
|
|
26 |
|
(285,011) |
|
5,828,754 |
|
247,532 |
|
4,732,624 |
|
(22,372) |
|
645 |
|
10,502,198 |
|
— |
|
10,502,198 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income for the period |
|
20 |
|
— |
|
— |
|
— |
|
— |
|
1,097,131 |
|
— |
|
— |
|
1,097,131 |
|
— |
|
1,097,131 |
|
Currency translation adjustment
|
|
20 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(717) |
|
(717) |
|
— |
|
(717) |
|
Gain on financial assets through OCI |
|
20 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
164 |
|
164 |
|
— |
|
164 |
|
Derivative Financial Instruments through OCI |
|
20 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(8,636) |
|
(8,636) |
|
— |
|
(8,636) |
|
Share based long term incentive plan (LTIP) |
|
20 |
|
— |
|
— |
|
— |
|
113,307 |
|
— |
|
— |
|
— |
|
113,307 |
|
— |
|
113,307 |
|
Acquisition of treasury shares |
|
20 |
|
— |
|
(191,819) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(191,819) |
|
— |
|
(191,819) |
|
(LTIP) of treasury shares |
|
20 |
|
— |
|
100,234 |
|
— |
|
(100,234) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
On September 30, 2022 |
|
|
|
26 |
|
(376,596) |
|
5,828,754 |
|
260,605 |
|
5,829,754 |
|
(22,372) |
|
(8,543) |
|
11,511,628 |
|
— |
|
11,511,628 |
The accompanying notes are an integral part of these unaudited
condensed consolidated interim financial statements.
|
|
|
|
|
|
|
7
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
|
Unaudited condensed consolidated interim statement of cash
flows
For the nine-month period ended September 30, 2022 and
2021
(All amounts in thousands of reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine-month period |
|
|
September 30, 2022 |
|
September 30, 2021 |
|
|
|
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
Profit before income taxes |
|
1,284,484 |
|
1,119,709 |
|
|
|
|
|
|
|
Expenses (revenues) not affecting cash:
|
|
|
|
|
|
Depreciation and amortization
|
|
824,004 |
|
543,126 |
|
Chargebacks and ECL
|
|
792,950 |
|
450,051 |
|
Accrual of provision for contingencies
|
|
27,969 |
|
19,911 |
|
Share based long term incentive plan (LTIP)
|
|
113,307 |
|
326,282 |
|
Reversal of taxes and contributions
|
|
— |
|
(29,114) |
|
Loss on disposal of property, equipment, intangible and investment
assets
|
|
189,308 |
|
20,444 |
|
Interest accrued
|
|
1,063,441 |
|
84,400 |
|
Other (income) cost, net
|
|
14,925 |
|
1,480 |
|
|
|
|
|
|
|
Changes in operating assets and liabilities
|
|
|
|
|
|
Accounts receivable
|
|
(14,955,359) |
|
(5,194,108) |
|
Financial investments (mandatory guarantee)
|
|
(209,556) |
|
2,069 |
|
Inventories
|
|
(2,525) |
|
(64,403) |
|
Taxes recoverable
|
|
102,909 |
|
(97,710) |
|
Other receivables
|
|
38,187 |
|
2,512 |
|
Deferred revenue
|
|
(28,872) |
|
(10,695) |
|
Other liabilities
|
|
(35,479) |
|
(13,821) |
|
Payables to third parties
|
|
1,124,710 |
|
883,004 |
|
Trade payables
|
|
(219,709) |
|
42,466 |
|
Receivables from (payables to) related parties
|
|
(118,883) |
|
311,165 |
|
Deposits
|
|
9,096,672 |
|
1,854,936 |
|
Salaries and social charges
|
|
41,035 |
|
9,460 |
|
Taxes and contributions
|
|
23,615 |
|
31,358 |
|
Provision for contingencies
|
|
(17,139) |
|
(12,994) |
|
|
|
(850,006) |
|
279,528 |
|
|
|
|
|
|
|
Income tax and social contribution paid
|
|
(86,560) |
|
(57,412) |
|
Interest income received
|
|
2,525,849 |
|
541,881 |
|
|
|
|
|
|
|
NET CASH PROVIDED BY OPERATING ACTIVITIES |
|
1,589,283 |
|
763,997 |
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
Amount paid on acquisitions, net of cash acquired
|
|
— |
|
(44,471) |
|
Purchases of property and equipment
|
|
(1,027,025) |
|
(701,338) |
|
Purchases and development of intangible assets
|
|
(731,361) |
|
(527,555) |
|
Redemption (Acquisition) of financial investments
|
|
393 |
|
2,293 |
|
|
|
|
|
|
|
NET CASH USED IN INVESTING ACTIVITIES |
|
(1,757,993) |
|
(1,271,071) |
|
|
|
|
|
|
|
|
|
|
|
|
|
8
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
|
Unaudited condensed consolidated interim statement of cash
flows
For the nine-month period ended September 30, 2022 and
2021
(All amounts in thousands of reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine-month period |
|
|
September 30, 2022 |
|
September 30, 2021 |
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
Borrowings
|
|
250,000 |
|
— |
|
Payment of borrowings
|
|
(250,000) |
|
— |
|
Payment of borrowings Interest
|
|
(15,337) |
|
— |
|
Acquisition of treasury shares
|
|
(191,819) |
|
— |
|
Payment of leases
|
|
(13,977) |
|
(10,603) |
|
|
|
— |
|
— |
|
|
|
|
|
|
|
NET CASH USED IN FINANCING ACTIVITIES |
|
(221,133) |
|
(10,603) |
|
|
|
|
|
|
|
DECREASE IN CASH AND CASH EQUIVALENTS |
|
(389,843) |
|
(517,677) |
|
|
|
|
|
|
|
Cash and cash equivalents at the beginning of the
period
|
|
1,794,362 |
|
1,640,065 |
|
Cash and cash equivalents at the end of the period
|
|
1,404,519 |
|
1,122,388 |
The accompanying notes are an integral part of these unaudited
condensed consolidated interim financial statements.
|
|
|
|
|
|
|
9
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
|
Unaudited condensed consolidated interim statement of cash
flows
For the nine-month period ended September 30, 2022 and
2021
(All amounts in thousands of reais)
|
PagSeguro Digital Ltd. ("PagSeguro Digital" or the "Company") is a
holding company with its principal executive offices located in
Cayman Islands, a subsidiary of Universo Online S.A. ("UOL"),
referred to, together with its subsidiaries, as the "PagSeguro
Group", and was incorporated on July 19, 2017. A total of 99.99% of
the shares of PagSeguro Internet Instituição de Pagamento S.A.
("PagSeguro Brazil") were contributed to PagSeguro Digital on
January 4, 2018 and PagSeguro Digital maintains control of
PagSeguro Brazil.
PagSeguro Brazil is a privately held corporation established on
January 20, 2006 and engages in providing financial technology
solutions and services and corresponding related activities,
focused principally on micro-merchants and small and medium-sized
businesses ("SMEs").
On March 18, 2021, PagSeguro Group constituted a holding company
incorporated as a subsidiary of PagSeguro Digital called PagSeguro
Holding Ltd (“PSHC”). Additionally, during the third quarter of
2021, Pagseguro Group established four new subsidiaries under PSHC:
Pagseguro Chile SPA (“Pagseguro Chile”), Pagseguro Colombia S.A.S
(“Pagseguro Colombia”), PSGP México S.A de C.V. (“PSGP Mexico”) and
Pagseguro Peru S.A.C. (“Pagseguro Peru”).
In June 2022, BoaCompra Tecnologia Ltda., changed its name to
PagSeguro Tecnologia Ltda. (“PagSeguro Tecnologia”), as part of a
marketing stategy to bring the entity closer to PagSeguro’s
brand.
The subsidiaries of PagSeguro Digital are PagSeguro Brazil, PagSeg
Participações Ltda. (“PagSeg”), BS Holding Financeira Ltda. (“BS
Holding”) and PSHC. The PagSeguro Group subsidiaries are as
follows:
•PagSeguro
Brazil subsidiaries are PagSeguro Biva Securitizadora de Créditos
Financeiras S.A. ("Biva Sec"), Fundo de Investimento em Direitos
Creditórios - PagSeguro ("FIDC"), RegistraSeguro S.A.
("RegistraSeguro"), Wirecard Brazil Instituição de Pagamento S.A.
("MOIP") and Concil Inteligência em Conciliação S.A
(“Concil”).
•PagSeg
subsidiaries are Net+Phone Telecomunicações Ltda. ("Net+Phone"),
Pagseguro Tecnologia, BCPS Online Services Lda. ("BCPS"), CDS
Serviços Financeiros Ltda. ("CDS"), Pagseguro Biva Serviços
Financeiros Ltda. (“Biva Serviços”) and PagBank Participações Ltda
(“PagBank”).
•PagBank
subsidiaries are Tilix Digital Ltda. ("TILIX"), YAMÍ Software &
Inovação Ltda. ("YAMÍ") and Zygo Serviços de Tecnologia S.A.
("ZYGO").
•PSHC
subsidiaries are Pagseguro Chile, Pagseguro Colombia, Pagseguro
Peru and PSGP México.
•BS
Holding subsidiary are BancoSeguro S.A. (“Bancoseguro”) and
Paginvest CTVM Ltda. (“Paginvest").
•Biva
Serviços subsidiary is Pagseguro Biva Correspondente Bancário Ltda.
(“Biva Corban”).
These consolidated financial statements include Pagseguro Brazil,
PagSeg, PSHC, BS Holding and the corresponding
subsidiaries.
|
|
|
|
|
|
|
10
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
1.1 Additional Information
During the year ended December 31, 2021, the Company observed that,
in the first three months, there was an increase in the number of
people infected by COVID-19 and consequently the return of partial
shutdowns and social isolation in several cities and states of the
country. In the second quarter of 2021, most of the cities in
Brazil accelerated the vaccination of the population, and
consequently, the Company saw a graduate reopening process, with
the extension of opening hours of commercial activities. In the
third and fourth quarters of 2021, the Company observed the return
of social events of the public, and consequently the growth of
transaction payment volume (“TPV”).
During the nine-month period ended September 30, 2022, Brazil
observed a decrease in the number of people infected and the total
deaths by COVID-19, and social events and commercial activities
generally returned to a level similar to that observed before the
pandemic. These circumstances resulted in higher TPV and
consequently higher revenues for the Company.
The Company has a significant variable cost structure mainly
related to TPV, such as processing, interchange, card scheme fees
and chargebacks. Marketing and sales expenses are also variable and
depend on the Company’s strategy to leverage new products and
services such as PagBank. The Company is also still accompanying
the evolution of the Brazilian economy and reassessing, when
necessary, the provisions for loss allowance for expected credit
losses.
The Company has a solid position in terms of cash, liquidity and
working capital levels and in the year ended December 31, 2021, as
well as in the first nine months of 2022, has not faced the
necessity of impairment of assets due to COVID-19.
Furthermore, geopolitical instability arising from conflicts, such
as the ongoing war in Ukraine, and the resulting imposition of
sanctions, taxes or tariffs against Russia and Russia’s response to
such sanctions (including retaliatory acts, such as cyberattacks
and sanctions against other countries) could adversely affect the
global economy or specific international, regional and domestic
markets, including the Brazilian market. Such events could have an
adverse effect on our business and financial performance through
increased worldwide inflation, greater compliance costs, higher
volatility in foreign currency exchange rates, destabilized supply
chains and further market disruptions, including from cyberattacks
targeting technologies that we rely on or the markets in which we
or our customers operate. At this moment, the Company does not see
any significant impact in its operations as a result of the
conflict.
|
|
|
|
|
|
|
11
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
|
|
|
|
2. Presentation and preparation of the unaudited condensed
consolidated interim financial statements and significant
accounting policies |
These unaudited condensed consolidated interim financial statements
do not include all of the information required for a complete set
of financial statements prepared in accordance with International
Financial Reporting Standards (“IFRS”) as issued by the
International Accounting Standard Board (“IASB”). However, selected
explanatory notes are included to explain events and transactions
that are significant to an understanding of the changes in the
Company’s financial position and performance since the last annual
financial statements.
These unaudited condensed consolidated interim financial statements
for three and nine-month periods ended September 30, 2022 were
authorized for issuance by the PagSeguro Digital’s Board of
Directors on November 18, 2022.
2.1. Basis of preparation of the condensed
consolidated interim financial information
These unaudited condensed consolidated interim financial statements
for the three and nine-month periods ended September 30, 2022 have
been prepared in accordance with International Accounting Standard
34, “Interim Financial Reporting” as issued by the IASB and
disclose all (and only) the applicable significant information
related to the financial statements, which is consistent with the
information utilized by management in the performance of its
duties.
These unaudited condensed consolidated interim financial statements
do not include all the notes of the type normally included in an
annual consolidated financial statement. Accordingly, this report
is to be read in conjunction with the annual consolidated financial
statements for the year ended December 31, 2021 (the “Annual
Financial Statements”).
The accounting policies and critical accounting estimates and
judgments adopted are consistent with those of the previous
financial year and corresponding interim reporting
period.
2.2. New accounting standards not yet
effective
The new and amended standards and interpretations that are issued,
but not yet effective, up to the date of issuance of the
consolidated financial statements are disclosed below. The Company
intends to adopt these new and amended standards and
interpretations, if applicable, when they become
effective.
-IFRS
17 was issued in May 2017 as replacement for IFRS 4 Insurance
Contracts. It requires a current measurement model where estimates
are remeasured in each reporting period. Contracts are measured
using the building blocks of discounted probability-weighted cash
flows, an explicit risk adjustment and a contractual service margin
(CSM) representing the unearned profit of the contract which is
recognised as revenue over the coverage period.
The standard allows a choice between recognising changes in
discount rates either in the statement of profit or loss or
directly in other comprehensive income. The choice is likely to
reflect how insurers account for their financial assets under IFRS
9. An optional, simplified premium allocation approach is permitted
for the liability for the remaining coverage for short duration
contracts, which are often written by non-life
insurers.
|
|
|
|
|
|
|
12
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
2.2. New accounting standards not yet
effective
(Continued)
There is a modification of the general measurement model called the
‘variable fee approach’ for certain contracts written by life
insurers where policyholders share in the returns from underlying
items. When applying the variable fee approach, the entity’s share
of the fair value changes of the underlying items is included in
the CSM. The results of insurers using this model are therefore
likely to be less volatile than under the general
model.
Targeted amendments made in July 2020 aimed to ease the
implementation of the standard by reducing implementation costs and
making it easier for entities to explain the results from applying
IFRS 17 to investors and others. The amendments also deferred the
application date of IFRS 17 to 1 January 2023. The group does not
expect the new IFRS to materially impact its results of
operations.
-Amendment
to IAS 1 "Presentation of Financial Statements": issued in May
2020, with the objective of clarifying that liabilities are
classified as current or non-current, depending on the rights that
exist at the end of the period. The classification is not affected
by the entity's expectations or events after the reporting date
(eg, receipt of a waiver or breach of covenant). The amendments
also clarify what "settlement" of a liability refers to under IAS
1. The amendments to IAS 1 are effective as of January 1, 2023. The
group does not expect the new amendment to materially impact its
results of operations.
-Amendment
to IAS 1 and IFRS Practice Statement 2 - Disclosure of Accounting
Policies: in February 2021 the IASB issued a new amendment to IAS 1
on disclosure of "material" accounting policies rather than
"significant" accounting policies. The amendments define what
"material accounting policy information" is and explain how to
identify it. It also clarifies that immaterial accounting policy
information does not need to be disclosed, but if so, it should not
obscure the relevant accounting information. To support this
change, the IASB also amended the "IFRS Practice Statement 2 Making
Materiality Judgments" to provide guidance on how to apply the
concept of materiality to accounting policy disclosures. This
amendment is effective as of January 1, 2023. The group does not
expect the new amendment to materially impact its results of
operations.
-Amendment
to IAS 8 - Accounting Policies, Change in Estimate and Error
Rectification: the amendment issued in February 2021 clarifies how
entities must distinguish changes in accounting policies from
changes in accounting estimates, as changes in accounting estimates
are applied prospectively to future transactions and other future
events, but changes in accounting policies are generally applied
retrospectively to past transactions and other past events, as well
as to the current period. This amendment is effective as of January
1, 2023. The group does not expect the new amendment to materially
impact its results of operations.
-Amendment
to IAS 12 - Income Taxes: the amendment issued in May 2021 requires
entities to recognize deferred tax on transactions that, on initial
recognition, give rise to equal amounts of taxable and deductible
temporary differences. This typically applies to lease transactions
(right-of-use assets and lease liabilities) and decommissioning and
restoration obligations, as an example, and will require the
recognition of additional deferred tax assets and liabilities. This
amendment is effective as of January 1, 2023.
|
|
|
|
|
|
|
13
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
|
|
|
|
3. Consolidation of subsidiaries |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
On September 30, 2022 |
|
Company |
Assets |
Liabilities |
Equity |
Net income (loss) for the period |
Ownership - % |
Level |
|
|
|
|
|
|
|
|
Pagseguro Brazil |
27,341,026 |
18,322,583 |
9,018,442 |
764,906 |
99.99 |
Direct |
|
BS Holding |
745,151 |
5,218 |
739,934 |
1,207 |
99.99 |
Direct |
|
Pagseg Participações |
776,461 |
870 |
775,591 |
71,397 |
99.99 |
Direct |
|
Pagseguro Holding |
5,028 |
6,133 |
(1,106) |
(161) |
99.99 |
Direct |
|
Pagbank Participações |
177,174 |
22,787 |
154,388 |
(16,281) |
99.99 |
Indirect |
|
Paginvest (i) |
2,000 |
— |
2,000 |
— |
100.00 |
Indirect |
|
Net+Phone |
403,808 |
58,961 |
344,848 |
72,924 |
99.99 |
Indirect |
|
Pagseguro Tecnologia |
357,280 |
134,049 |
223,231 |
10,202 |
99.99 |
Indirect |
|
BCPS |
1,772 |
(51) |
1,823 |
483 |
99.99 |
Indirect |
|
BSEC |
1,757,306 |
1,745,839 |
11,467 |
4,372 |
99.99 |
Indirect |
|
Biva Serviços |
45,759 |
5,155 |
40,604 |
3,356 |
99.99 |
Indirect |
|
Biva Corban |
18,075 |
809 |
17,266 |
1,512 |
99.99 |
Indirect |
|
FIDC |
5,285,975 |
781,015 |
4,504,960 |
1,624,465 |
100.00 |
Indirect |
|
TILIX |
13,891 |
1,677 |
12,214 |
(185) |
99.99 |
Indirect |
|
BancoSeguro |
20,821,714 |
20,117,951 |
703,763 |
(8,952) |
100.00 |
Indirect |
|
Yamí |
2,894 |
815 |
2,079 |
(646) |
99.99 |
Indirect |
|
Registra Seguro |
5,000 |
18 |
4,982 |
(18) |
99.99 |
Indirect |
|
CDS |
10,932 |
703 |
10,230 |
756 |
99.99 |
Indirect |
|
Zygo |
4,875 |
12,337 |
(7,461) |
(11,196) |
99.99 |
Indirect |
|
Moip |
733,824 |
577,962 |
155,861 |
(35,404) |
100.00 |
Indirect |
|
Concil |
12,112 |
12,777 |
(664) |
(5,473) |
100.00 |
Indirect |
|
Pagseguro Chile |
34 |
95 |
(61) |
(68) |
100.00 |
Indirect |
|
Pagseguro Colombia |
992 |
1,400 |
(408) |
(414) |
100.00 |
Indirect |
|
PSGP México |
1,031 |
1,384 |
(352) |
(370) |
100.00 |
Indirect |
|
Pagseguro Peru |
14 |
286 |
(272) |
281 |
100.00 |
Indirect |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
On December 31, 2021 (except for net income (loss), that is
presented to nine-month period ended September 30,
2021)
|
|
On December 31, 2021 |
|
Company |
Assets |
Liabilities |
Equity |
Net income (loss) for the period |
Ownership - % |
Level |
|
|
|
|
|
|
|
|
Pagseguro Brazil |
23,863,783 |
15,250,100 |
8,613,683 |
773,576 |
99.99 |
Direct |
|
BS Holding |
545,693 |
7,019 |
538,674 |
19,313 |
99.99 |
Direct |
|
Pagseg Participações |
648,175 |
5,870 |
642,305 |
73,792 |
99.99 |
Direct |
|
Pagseguro Holding (i) |
36 |
— |
36 |
— |
99.99 |
Direct |
|
Pagbank Participações |
180,053 |
9,385 |
170,668 |
(2,270) |
99.99 |
Indirect |
|
Net+Phone |
375,347 |
103,424 |
271,923 |
43,483 |
99.99 |
Indirect |
|
Pagseguro Tecnologia |
456,934 |
243,905 |
213,029 |
10,494 |
99.99 |
Indirect |
|
BCPS |
2,022 |
(52) |
2,074 |
222 |
99.99 |
Indirect |
|
BSEC |
1,446,640 |
1,439,545 |
7,095 |
3,727 |
99.99 |
Indirect |
|
Biva Serviços |
42,901 |
5,653 |
37,248 |
3,115 |
99.99 |
Indirect |
|
Biva Corban |
21,200 |
5,446 |
15,754 |
8,519 |
99.99 |
Indirect |
|
FIDC |
4,770,455 |
816,980 |
3,953,475 |
1,728,015 |
100.00 |
Indirect |
|
TILIX |
13,972 |
1,573 |
12,399 |
5,011 |
99.99 |
Indirect |
|
BancoSeguro |
10,320,430 |
9,807,767 |
512,663 |
19,326 |
100.00 |
Indirect |
|
Yamí |
2,087 |
861 |
1,226 |
44 |
99.99 |
Indirect |
|
Registra Seguro |
5,000 |
9 |
4,991 |
(7) |
99.99 |
Indirect |
|
CDS |
10,057 |
5,583 |
4,474 |
(2,842) |
99.99 |
Indirect |
|
Zygo |
2,013 |
4,278 |
(2,265) |
(7,099) |
99.99 |
Indirect |
|
Moip |
787,659 |
596,429 |
191,230 |
2,999 |
100.00 |
Indirect |
|
Concil |
2,390 |
3,080 |
(690) |
(424) |
100.00 |
Indirect |
|
Pagseguro Chile (i) |
7 |
— |
7 |
— |
100.00 |
Indirect |
|
Pagseguro Colombia (i) |
28 |
— |
28 |
— |
100.00 |
Indirect |
|
PSGP México (i) |
1 |
— |
1 |
— |
100.00 |
Indirect |
|
Pagseguro Peru (i) |
13 |
— |
13 |
— |
100.00 |
Indirect |
(i) Entities with very limited or no operation.
The operational context of the subsidiaries is to be read in
conjunction with the annual financial statements for the year ended
December 31, 2021.
|
|
|
|
|
|
|
14
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
Operating segments are determined based on the information reported
and reviewed by the Board of Directors, which is responsible for
allocating resources and assessing the performance of the business
and to make PagSeguro Group's strategic decisions.
Considering that all decisions are based on consolidated reports,
and that all decisions related to strategic and financial planning,
purchases, investments and the allocation of funds are made on a
consolidated basis, the PagSeguro Group and its subsidiaries
operate in a single segment, as financial service
agents.
Main companies of PagSeguro Group are domiciled in Brazil and have
revenue arising from local customers and customers located abroad.
The main revenue is related to sales from the domestic market. The
revenue from international market represents 0.7%, and 1% for the
three and nine-month periods ended September 30, 2022, respectively
(2.3% and 2.8% for three and nine-month periods ended September 30,
2021 respectively).
|
|
|
|
5. Cash and cash equivalents
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
|
|
|
|
Short-term bank deposits |
578,051 |
|
569,816 |
|
Short-term investment |
826,468 |
|
1,224,546 |
|
|
1,404,519 |
|
1,794,362 |
Cash and cash equivalents are held for the purpose of meeting
short-term cash needs and include cash on hand, deposits with banks
and other short-term highly liquid investments with original
maturities of three-month or less and with immaterial risk of
change in value.
Short-term bank deposits is mainly represented by amounts to cover
instant payments (PIX), cash on ATMs and clients
payments.
Short-term investments consist mainly of investments in Brazilian
Treasury Bonds ("LFTs") with an average return of 100% of the Basic
Interest Rate (SELIC, 13.75% per year on September 30, 2022 and
9.25% per year on December 31, 2021).
Consists of investments in LFTs, in the amount of R$1,073,816 in
September 30, 2022 (R$782,647 in December 31, 2021) with an average
return of 100% of the Basic Interest Rate (SELIC, 13.75% per year
on September 30, 2022 and 9.25% per year on December 31, 2021),
invested to comply with certain requirements for authorized payment
institutions as set forth by the Brazilian Central Bank regulation.
This financial asset was classified at fair value through other
comprehensive income. Unrealized accumulated gain on LFTs in
September 30, 2022 totaled R$130 (gain of R$164 in the nine-month
period ended September 30, 2022).
|
|
|
|
|
|
|
15
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
|
Visa |
|
Master |
|
Hipercard |
|
Elo |
|
Amex |
|
Total |
|
Visa |
|
Master |
|
Hipercard |
|
Elo |
|
Amex |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Legal obligors |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Itaú |
|
2,354,069 |
|
5,398,946 |
|
728,853 |
|
— |
|
— |
|
8,481,868 |
|
1,333,262 |
|
2,045,134 |
|
757,306 |
|
— |
|
— |
|
4,135,702 |
|
Bradesco |
|
2,152,584 |
|
209,360 |
|
— |
|
1,199,023 |
|
426,439 |
|
3,987,406 |
|
1,630,756 |
|
160,690 |
|
— |
|
842,352 |
|
296,696 |
|
2,930,494 |
|
Nubank |
|
— |
|
3,606,582 |
|
— |
|
— |
|
— |
|
3,606,582 |
|
— |
|
2,045,699 |
|
— |
|
— |
|
— |
|
2,045,699 |
|
Santander |
|
664,816 |
|
2,427,889 |
|
— |
|
— |
|
8,200 |
|
3,100,905 |
|
818,937 |
|
1,464,314 |
|
— |
|
— |
|
3,253 |
|
2,286,504 |
|
Banco do Brasil |
|
2,229,270 |
|
295,537 |
|
— |
|
551,439 |
|
— |
|
3,076,246 |
|
1,384,872 |
|
77,639 |
|
— |
|
467,305 |
|
— |
|
1,929,816 |
|
Banco Carrefour |
|
145,778 |
|
960,791 |
|
— |
|
— |
|
— |
|
1,106,569 |
|
121,398 |
|
744,030 |
|
— |
|
— |
|
— |
|
865,428 |
|
Porto Seguro |
|
685,787 |
|
181,694 |
|
— |
|
— |
|
— |
|
867,481 |
|
550,352 |
|
141,924 |
|
— |
|
— |
|
— |
|
692,276 |
|
CEF |
|
269,445 |
|
173,395 |
|
— |
|
376,800 |
|
— |
|
819,640 |
|
206,969 |
|
136,125 |
|
— |
|
257,929 |
|
— |
|
601,023 |
|
Banco C6 |
|
— |
|
800,713 |
|
— |
|
— |
|
— |
|
800,713 |
|
— |
|
481,017 |
|
— |
|
— |
|
— |
|
481,017 |
|
Banco Cooperativo Sicoob |
|
4,001 |
|
723,142 |
|
— |
|
— |
|
— |
|
727,143 |
|
— |
|
466,030 |
|
— |
|
— |
|
— |
|
466,030 |
|
Sicredi |
|
383,263 |
|
332,397 |
|
— |
|
— |
|
— |
|
715,660 |
|
233,081 |
|
202,562 |
|
— |
|
— |
|
— |
|
435,643 |
|
Banco Inter |
|
— |
|
525,053 |
|
— |
|
— |
|
— |
|
525,053 |
|
— |
|
407,601 |
|
— |
|
— |
|
— |
|
407,601 |
|
Banco Bradescard |
|
310,601 |
|
75,360 |
|
— |
|
18,727 |
|
— |
|
404,688 |
|
362,978 |
|
91,016 |
|
— |
|
9,368 |
|
— |
|
463,362 |
|
Midway |
|
269,755 |
|
126,466 |
|
— |
|
— |
|
— |
|
396,221 |
|
199,605 |
|
94,396 |
|
— |
|
— |
|
— |
|
294,001 |
|
Banco Votorantim |
|
— |
|
358,353 |
|
— |
|
— |
|
— |
|
358,353 |
|
— |
|
316,917 |
|
— |
|
— |
|
— |
|
316,917 |
|
Banco XP |
|
333,326 |
|
— |
|
— |
|
— |
|
— |
|
333,326 |
|
197,903 |
|
— |
|
— |
|
— |
|
— |
|
197,903 |
|
Realize |
|
150,308 |
|
180,803 |
|
— |
|
— |
|
— |
|
331,111 |
|
85,992 |
|
161,637 |
|
— |
|
— |
|
— |
|
247,629 |
|
Banco Pan |
|
55,702 |
|
271,956 |
|
— |
|
— |
|
— |
|
327,658 |
|
52,514 |
|
271,717 |
|
— |
|
— |
|
— |
|
324,231 |
|
Will Financeira |
|
— |
|
311,663 |
|
— |
|
— |
|
— |
|
311,663 |
|
— |
|
55,972 |
|
— |
|
— |
|
— |
|
55,972 |
|
Banco Original |
|
— |
|
299,219 |
|
— |
|
— |
|
— |
|
299,219 |
|
— |
|
168,343 |
|
— |
|
— |
|
— |
|
168,343 |
|
Outros |
|
1,499,186 |
|
965,259 |
|
— |
|
333,046 |
|
1,118 |
|
2,798,609 |
|
1,337,653 |
|
984,499 |
|
— |
|
215,379 |
|
770 |
|
2,538,301 |
|
Total card issuers(i) |
|
11,507,891 |
|
18,224,578 |
|
728,853 |
|
2,479,035 |
|
435,757 |
|
33,376,114 |
|
8,516,272 |
|
10,517,262 |
|
757,306 |
|
1,792,333 |
|
300,719 |
|
21,883,892 |
|
Current card issuers |
|
|
|
|
|
|
|
|
|
|
|
33,231,976 |
|
|
|
|
|
|
|
|
|
|
|
21,883,892 |
|
Non – Current card issuers |
|
|
|
|
|
|
|
|
|
|
|
144,138 |
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cielo – Elo |
|
— |
|
— |
|
— |
|
— |
|
— |
|
174 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
42,662 |
|
Getnet |
|
— |
|
— |
|
— |
|
— |
|
— |
|
75,532 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
97,248 |
|
Other |
|
— |
|
— |
|
— |
|
— |
|
— |
|
5,931 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
11,716 |
|
Total acquirers (ii) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
81,637 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
151,626 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Working capital loans |
|
— |
|
— |
|
— |
|
— |
|
— |
|
813,282 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
1,069,671 |
|
Working capital loans ECL (iii) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(494,106) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(256,927) |
|
Credit card receivables |
|
— |
|
— |
|
— |
|
— |
|
— |
|
1,014,126 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
726,095 |
|
Credit card receivables ECL (iii) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(399,559) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(174,046) |
|
Other credit iniciatives |
|
— |
|
— |
|
— |
|
— |
|
— |
|
825,856 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
110,050 |
|
Other credit iniciatives ECL (iii) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(8,911) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(6,166) |
|
Total credit receivables |
|
— |
|
— |
|
— |
|
— |
|
— |
|
1,750,688 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
1,468,676 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current |
|
|
|
|
|
|
|
|
|
|
|
1,163,467 |
|
|
|
|
|
|
|
|
|
|
|
1,239,796 |
|
Non – Current |
|
|
|
|
|
|
|
|
|
|
|
587,221 |
|
|
|
|
|
|
|
|
|
|
|
228,880 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other accounts receivable |
|
— |
|
— |
|
— |
|
— |
|
— |
|
96,582 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
156,700 |
|
Other accounts receivable ECL |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(3,888) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(3,493) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total accounts receivable |
|
11,507,891 |
|
18,224,578 |
|
728,853 |
|
2,479,035 |
|
435,757 |
|
35,301,133 |
|
8,516,272 |
|
10,517,262 |
|
757,306 |
|
1,792,333 |
|
300,719 |
|
23,657,402 |
|
Current |
|
|
|
|
|
|
|
|
|
|
|
34,569,772 |
|
|
|
|
|
|
|
|
|
|
|
23,428,522 |
|
Non – Current |
|
|
|
|
|
|
|
|
|
|
|
731,361 |
|
|
|
|
|
|
|
|
|
|
|
228,880 |
|
|
|
|
|
|
|
16
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
7. Accounts receivable
(Continued)
(i) Card issuers: receivables derived from transactions where
PagSeguro Brazil acts as the financial intermediary in operations
with the issuing banks, related to the intermediation agreements
between PagSeguro Brazil and Visa, Mastercard, Hipercard, Amex or
Elo. However, PagSeguro Brazil’s contractual accounts receivable
are with the financial institutions, which are the legal obligors
on the accounts receivable payment. Additionally, amounts due
within 27 days of the original transaction, including those that
fall due with the first installment of installment receivables, are
guaranteed by Visa, Mastercard, Hipercard, Amex or Elo, as
applicable, if the legal obligors do not make the
payment.
(ii) Acquirers: refers to card processing transactions to be
received from the acquirers, which are a third parties acting as
financial intermediaries between the issuing bank and PagSeguro
Brazil.
(iii) The ECL (“expected credit losses”), are measured according to
the IFRS 9. The provision rates are based on the internal credit
rating that considers external information and are based on days
past due. Every report date, PagSeguro reassesses the premises to
adjust the historical credit loss experience with prospective
information.
(iv) Refers to other dispersed receivables from legal
obligors.
The maturity analysis of accounts receivable is as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
|
|
|
|
Past due after 91 days |
751,035 |
|
325,263 |
|
Past due within 31 to 90 days |
110,867 |
|
93,753 |
|
Past due within 30 days |
80,154 |
|
84,447 |
|
Due within 30 days |
12,363,185 |
|
3,924,701 |
|
Due within 31 to 120 days |
13,142,216 |
|
12,033,372 |
|
Due within 121 to 180 days |
4,674,985 |
|
3,457,830 |
|
Due within 181 to 360 days |
4,353,793 |
|
3,808,539 |
|
Due after 360 days |
731,361 |
|
370,128 |
|
Expected credit losses |
(906,463) |
|
(440,631) |
|
|
35,301,133 |
|
23,657,402 |
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
|
|
|
|
Income tax and Social contribution (i) |
413,703 |
|
294,955 |
|
Social integration program (ii) |
34,804 |
|
167,701 |
|
Other |
11,741 |
|
6,834 |
|
|
460,248 |
|
469,490 |
(i)The
increase is mainly related to withholding taxes from FIDC quotas
redeemed during 2022 amounted to R$1,072,980, representing
withholding taxes of R$139,319
(ii)Refers
to Social Integration Program (PIS) and Social Contribution on
Revenues (COFINS) recoverable on transaction activities and other
services.
|
|
|
|
|
|
|
17
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
|
|
|
|
9. Related-party balances and transactions |
i)Balances
and transactions with related parties
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
Payables |
|
Payables |
|
|
|
|
|
Immediate parent |
|
|
|
|
UOL - sales of services (a)
|
10,719 |
|
16,216 |
|
UOL - shared service costs (b)
|
10,484 |
|
19,093 |
|
UOL – Deposits (c)
|
219,050 |
|
248,271 |
|
Affiliated companies |
|
|
|
|
UOL Edtech Tecnologia Educacional S.A - Deposits (c)
|
103,773 |
|
229,250 |
|
Digital Services UOL S.A - sales of services (d)
|
9,546 |
|
7,612 |
|
Compass. UOL S.A. (d)
|
13,940 |
|
12,853 |
|
Web Jump Design em Informática Ltda.- Deposits (c)
|
12,493 |
|
— |
|
Ingresso.com Ltda. - Depositis (c)
|
20,293 |
|
— |
|
Invillia Desenvolvimento de Produtos Digitais Ltda – Deposits
(c)
|
35,427 |
|
— |
|
Compass. UOL Tecnologia Ltda (d)
|
5,040 |
|
— |
|
Others
|
10,222 |
|
10,326 |
|
450,987 |
|
543,621 |
(a)Sales
of services refer mainly to the purchase of advertising services
from UOL.
(b)Shared
services costs mainly related to payroll costs that are incurred by
the parent company UOL and are charged to PagSeguro
Group.
(c)Certificate
of deposits (CD) acquired by UOL, UOL Edtech Tecnologia Educacional
S.A, Web Jump Design em Informática Ltda., Ingresso.com Ltda.,
Invillia Desenvolvimento de Produtos Digitais Ltda. and others from
BancoSeguro with interest rate between 110% to 115% per year of
CDI. The maturity analysis is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
|
|
|
|
Due within 31 to 120 days |
24,808 |
|
— |
|
Due within 121 to 180 days |
— |
|
193,592 |
|
Due within 181 to 365 days |
369,576 |
|
283,929 |
|
|
394,384 |
|
477,521 |
(d)This
payable refers mainly to colocation and cloud
services.
|
|
|
|
|
|
|
18
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
9. Related-party balances and
transactions
(continued)
ii) Revenue
and expense from transactions with related parties
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine-month period |
|
|
September 30, 2022 |
|
September 30, 2021 |
|
September 30, 2022 |
|
September 30, 2021 |
|
Revenue |
|
Expense |
|
Revenue |
|
Expense |
|
Revenue |
|
Expense |
|
Revenue |
|
Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Immediate parent |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UOL - shared service costs (a)
|
— |
|
40,638 |
|
— |
|
68,017 |
|
— |
|
96,722 |
|
— |
|
109,409 |
|
UOL - sales of services (b)
|
779 |
|
21,783 |
|
839 |
|
24,028 |
|
2,339 |
|
66,619 |
|
2,424 |
|
69,915 |
|
UOL - deposits (c)
|
— |
|
5,218 |
|
— |
|
628 |
|
— |
|
12,678 |
|
— |
|
947 |
|
Affiliated companies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Digital Services UOL S.A. (d)
|
— |
|
642 |
|
— |
|
577 |
|
— |
|
1,855 |
|
— |
|
2,289 |
|
UOL Edtech Tecnologia Educacional S.A. – Deposits (c)
|
— |
|
3,569 |
|
— |
|
4,881 |
|
— |
|
11,984 |
|
— |
|
4,881 |
|
Compass. UOL S.A.(d)
|
— |
|
38,825 |
|
— |
|
24,004 |
|
— |
|
102,753 |
|
— |
|
65,281 |
|
Transfolha Transportadora e Distribuição Ltda.
|
— |
|
— |
|
— |
|
3,598 |
|
— |
|
— |
|
— |
|
12,485 |
|
Others
|
155 |
|
3,997 |
|
215 |
|
— |
|
594 |
|
8,305 |
|
768 |
|
1,630 |
|
|
934 |
|
114,671 |
|
1,054 |
|
125,733 |
|
2,933 |
|
300,916 |
|
3,192 |
|
266,837 |
(a)Shared
services costs mainly related to payroll costs sharing that are
incurred by the parent company UOL and are charged to PagSeguro.
Such costs are included in administrative expenses.
(b)Sale
of services expenses is related to advertising services from UOL
and revenue is related to intermediation fees.
(c)Expenses
are related to UOL and UOL Edtech Tecnologia Educacional S.A., of
BancoSeguro's Certificate of Deposits (CD).
(d)Expenses
related to colocation and cloud services.
iii)Key
management compensation
Key management compensation includes short and long-term benefits
of PagSeguro Brazil's executive officers. The short and long-term
compensation related to the executive officers for the three and
nine month periods ended September 30, 2022 amounted to R$9,225 and
R$20,300 (R$222 and R$39,642 for the three and nine month periods
ended September 30, 2021).
|
|
|
|
|
|
|
19
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
|
|
|
|
10. Business combinations |
On August 12, 2021, PagSeguro Brazil acquired 100% of the share
capital and obtained control of Concil. Total consideration
amounted to R$43,896 and the total net assets acquired at fair
value amounted to R$23,165. The consideration paid in cash amounted
to R$35,000 and the remaining portion in amount of R$8,896 was
recognized in other liabilities and will be retained for the
achievement of metrics. Concil main activity is in the information
technology industry, focused on the processing of back-office
solutions, including reconciliation services for the capture of
credit cards with acquirers and sub acquirers.
The preliminary purchase price allocation ("PPA") was completed on
September 30, 2021, which included the recognition of a customer
portfolio with a fair value of R$3,839, non-compete agreement of
R$940 and software of R$33,136. The Company has also recognized a
contingency liability and indemnification assets of R$7,848
resulting in the recognition of goodwill of R$20,731, which is
attributable mainly to operational synergy and cost
reductions.
The PPA was elaborated considering projections for the period of
five years based on management's budgets for Concil and applying an
inflation rate plus the estimated growth of GDP of services
(fluctuating from 2.0% to 4.5% per year) in order to project future
cash flows, with a discount rate based on the weighted average cost
of capital (fluctuating from 17.5% to 19.5% per year).
These acquisitions are in accordance with PagSeguro Group's
business strategies, ramping up investments on new technologies,
products, and services for the Group’s digital ecosystem. The fair
value of assets and liabilities acquired is detailed in our annual
financial statements for the year ended December 31,
2021.
|
|
|
|
|
|
|
20
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
|
|
|
|
11. Property and equipment
|
a)Property
and equipment are composed as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
Cost |
|
Accumulated depreciation |
|
Net |
|
|
|
|
|
|
|
Data processing equipment |
201,206 |
|
(62,835) |
|
138,371 |
|
Machinery and equipment (i) |
3,452,989 |
|
(1,002,191) |
|
2,450,799 |
|
Buildings Leasing (ii) |
98,544 |
|
(39,289) |
|
59,255 |
|
Other |
33,766 |
|
(10,434) |
|
23,332 |
|
Total |
3,786,505 |
|
(1,114,749) |
|
2,671,757 |
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2021 |
|
Cost |
|
Accumulated depreciation |
|
Net |
|
|
|
|
|
|
|
Data processing equipment |
106,643 |
|
(51,294) |
|
55,349 |
|
Machinery and equipment (i) |
2,798,823 |
|
(654,360) |
|
2,144,463 |
|
Buildings Leasing (ii) |
94,048 |
|
(26,928) |
|
67,120 |
|
Other |
29,909 |
|
(7,789) |
|
22,120 |
|
Total |
3,029,423 |
|
(740,371) |
|
2,289,052 |
|
|
|
|
|
|
|
21
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
11. Property and equipment
(continued)
b)The
changes in cost and accumulated depreciation were as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Data processing equipment |
|
Machinery and equipment (i) |
|
Buildings Leasing (ii) |
|
Other |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
On
December 31, 2020 |
|
|
|
|
|
|
|
|
|
|
Cost |
77,413 |
|
1,881,556 |
|
79,890 |
|
22,114 |
|
2,060,973 |
|
Accumulated depreciation |
(35,572) |
|
(204,154) |
|
(12,621) |
|
(6,013) |
|
(258,360) |
|
Net book value |
41,841 |
|
1,677,402 |
|
67,269 |
|
16,101 |
|
1,802,613 |
|
|
|
|
|
|
|
|
|
|
|
|
On December 31, 2021 |
|
|
|
|
|
|
|
|
|
|
Opening balance |
|
|
|
|
|
|
|
|
|
|
Cost |
29,230 |
|
917,267 |
|
14,156 |
|
7,796 |
|
968,449 |
|
Purchases
|
29,940 |
|
931,859 |
|
15,013 |
|
10,478 |
|
987,290 |
|
Disposals
|
(1,226) |
|
(14,601) |
|
(857) |
|
(2,902) |
|
(19,586) |
|
Acquisition of subsidiary
|
516 |
|
9 |
|
— |
|
220 |
|
745 |
|
Depreciation |
(15,722) |
|
(450,206) |
|
(14,305) |
|
(1,777) |
|
(482,010) |
|
Depreciation
|
(16,407) |
|
(453,593) |
|
(14,804) |
|
(3,137) |
|
(487,941) |
|
Disposals
|
1,063 |
|
3,389 |
|
499 |
|
1,445 |
|
6,396 |
|
Acquisition of subsidiary
|
(378) |
|
(3) |
|
— |
|
(85) |
|
(466) |
|
Net book value |
55,349 |
|
2,144,463 |
|
67,120 |
|
22,120 |
|
2,289,052 |
|
|
|
|
|
|
|
|
|
|
|
|
On December 31, 2021 |
|
|
|
|
|
|
|
|
|
|
Cost |
106,643 |
|
2,798,823 |
|
94,048 |
|
29,909 |
|
3,029,423 |
|
Accumulated depreciation |
(51,294) |
|
(654,360) |
|
(26,928) |
|
(7,789) |
|
(740,371) |
|
Net book value |
55,349 |
|
2,144,463 |
|
67,120 |
|
22,120 |
|
2,289,052 |
|
|
|
|
|
|
|
|
|
|
|
|
On September 30, 2022 |
|
|
|
|
|
|
|
|
|
|
Opening balance |
|
|
|
|
|
|
|
|
|
|
Cost |
94,563 |
|
654,168 |
|
4,496 |
|
3,857 |
|
757,082 |
|
Purchases
|
96,120 |
|
925,575 |
|
4,496 |
|
5,330 |
|
1,031,521 |
|
Disposals (iii)
|
(1,557) |
|
(271,407) |
|
— |
|
(1,473) |
|
(274,437) |
|
Depreciation |
(11,541) |
|
(347,831) |
|
(12,361) |
|
(2,645) |
|
(374,378) |
|
Depreciation
|
(11,653) |
|
(477,614) |
|
(12,361) |
|
(2,893) |
|
(504,521) |
|
Disposals (iii)
|
112 |
|
129,783 |
|
— |
|
248 |
|
130,143 |
|
Net book value |
138,371 |
|
2,450,798 |
|
59,255 |
|
23,332 |
|
2,671,757 |
|
|
|
|
|
|
|
|
|
|
|
|
On September 30, 2022 |
|
|
|
|
|
|
|
|
|
|
Cost |
201,206 |
|
3,452,989 |
|
98,544 |
|
33,766 |
|
3,786,505 |
|
Accumulated depreciation |
(62,835) |
|
(1,002,191) |
|
(39,289) |
|
(10,434) |
|
(1,114,749) |
|
Net book value |
138,371 |
|
2,450,798 |
|
59,255 |
|
23,332 |
|
2,671,757 |
(i)Net
book value of POS devices is R$2,399,327 (R$2,091,671 as of
December 31, 2021), which are depreciated over 5 years. The
depreciation of POS in the nine-month period ended September 30,
2022, amounted to R$472,790 (R$319,703 in the nine-month period
ended September 30, 2021). On September 30, 2022, PagSeguro have
contractual obligations to acquire POS devices in the amount of
R$978,995 (R$1,650,885 on December 31, 2021).
(ii)The
leasing context is to be read in connection with the annual
financial statements for the year ended December 31, 2021. As of
September 30, 2022, PagSeguro had a lease liability presented in
other current liabilities in the amount of R$16,707 (R$15,690 in
December 31, 2021) and as non-current liability in the amount of
R$42,638 (R$51,521 in December 31, 2021). In the nine month period
ended September 30, 2022, the Company incurred in financial
expenses related to these leases of R$13,977 (R$10,603 in the nine
month period ended September 30, 2021).
(iii)The
net book value of disposals is R$ 144,294 of which R$ 274,437 are
cost and R$ 130,143 are accumulated depreciation. During the nine
months period ended September 30, 2022, the Company revised its
business strategy towards a specific group of merchants and
observed no future economic benefit is expected from them,
resulting in the provision for write off of POS devices allocated
to these merchants in the net book value of R$134,306 (R$262,364
are cost and R$128,058 are accumulated depreciation).
|
|
|
|
|
|
|
22
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
a)Intangible
assets are composed as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
Cost |
|
Accumulated amortization |
|
Net |
|
|
|
|
|
|
|
Expenditures related to software and technology (i) |
2,615,810 |
|
(1,035,265) |
|
1,580,545 |
|
Software licenses |
250,936 |
|
(85,486) |
|
165,450 |
|
Goodwill (ii) |
209,908 |
|
— |
|
209,908 |
|
Other |
67,768 |
|
(24,375) |
|
43,393 |
|
|
3,144,422 |
|
(1,145,126) |
|
1,999,296 |
|
|
|
|
|
|
|
December 31, 2021 |
|
|
|
|
|
|
|
Cost |
|
Accumulated amortization |
|
Net |
|
|
|
|
|
|
|
Expenditures related to software and technology (i) |
2,016,541 |
|
(772,804) |
|
1,243,737 |
|
Software licenses |
196,854 |
|
(53,129) |
|
143,725 |
|
Goodwill (ii) |
209,908 |
|
— |
|
209,908 |
|
Other |
67,768 |
|
(14,962) |
|
52,806 |
|
|
2,491,071 |
|
(840,895) |
|
1,650,176 |
(i)The
PagSeguro Group capitalizes expenses incurred with the development
of platforms, which are amortized over their useful lives of
approximately five years.
(ii)The
balances comprise the goodwill arising from the acquisition of the
companies Biva, BancoSeguro, Yamí, Zygo, Moip and
Concil.
|
|
|
|
|
|
|
23
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
|
|
|
|
12. Intangible assets
(continued)
|
b)The
changes in cost and accumulated amortization were as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenditures with software and technology
|
|
Software licenses |
|
Goodwill |
|
Other |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
On December 31, 2020 |
|
|
|
|
|
|
|
|
|
|
Cost |
1,319,061 |
|
103,256 |
|
169,667 |
|
62,786 |
|
1,654,770 |
|
Accumulated amortization |
(501,319) |
|
(29,060) |
|
— |
|
(771) |
|
(531,150) |
|
Net book value |
817,742 |
|
74,196 |
|
169,667 |
|
62,015 |
|
1,123,620 |
|
|
|
|
|
|
|
|
|
|
|
|
On December 31, 2021 |
|
|
|
|
|
|
|
|
|
|
Cost |
697,480 |
|
93,597 |
|
40,241 |
|
4,983 |
|
836,301 |
|
Additions (i) |
715,382 |
|
97,103 |
|
40,589 |
|
4,983 |
|
858,057 |
|
Disposals
|
(18,167) |
|
(3,645) |
|
(348) |
|
— |
|
(22,160) |
|
Acquisition of subsidiary
|
265 |
|
139 |
|
— |
|
— |
|
404 |
|
Amortization |
(271,485) |
|
(24,068) |
|
— |
|
(14,192) |
|
(309,745) |
|
Amortization |
(278,220) |
|
(24,290) |
|
— |
|
(14,192) |
|
(316,702) |
|
Disposals |
6,735 |
|
222 |
|
— |
|
— |
|
6,957 |
|
Net book value |
1,243,737 |
|
143,725 |
|
209,908 |
|
52,806 |
|
1,650,176 |
|
|
|
|
|
|
|
|
|
|
|
|
On December 31, 2021 |
|
|
|
|
|
|
|
|
|
|
Cost |
2,016,541 |
|
196,854 |
|
209,908 |
|
67,768 |
|
2,491,071 |
|
Accumulated amortization |
(772,804) |
|
(53,129) |
|
— |
|
(14,962) |
|
(840,895) |
|
Net book value |
1,243,737 |
|
143,725 |
|
209,908 |
|
52,806 |
|
1,650,176 |
|
|
|
|
|
|
|
|
|
|
|
|
On September 30, 2022 |
|
|
|
|
|
|
|
|
|
|
Cost |
599,269 |
|
54,082 |
|
— |
|
— |
|
653,351 |
|
Additions (i)
|
676,918 |
|
54,443 |
|
— |
|
— |
|
731,361 |
|
Disposals (ii)
|
(77,649) |
|
(361) |
|
— |
|
— |
|
(78,010) |
|
Amortization |
(262,461) |
|
(32,357) |
|
— |
|
(9,413) |
|
(304,231) |
|
Amortization
|
(307,727) |
|
(32,690) |
|
— |
|
(9,413) |
|
(349,830) |
|
Disposals
|
45,266 |
|
333 |
|
— |
|
— |
|
45,599 |
|
Net book value |
1,580,545 |
|
165,450 |
|
209,908 |
|
43,393 |
|
1,999,296 |
|
|
|
|
|
|
|
|
|
|
|
|
On September 30, 2022 |
|
|
|
|
|
|
|
|
|
|
Cost |
2,615,810 |
|
250,936 |
|
209,908 |
|
67,768 |
|
3,144,422 |
|
Accumulated amortization |
(1,035,265) |
|
(85,486) |
|
— |
|
(24,375) |
|
(1,145,126) |
|
Net book value |
1,580,545 |
|
165,450 |
|
209,908 |
|
43,393 |
|
1,999,296 |
(i) Refers to several and diverse expenditures with software and
technology, mainly related to customer experience functionalities,
such as, digital payment and digital banking account. Goodwill
recorded in business combinations in 2021 are related to Concil and
MOIP acquisitions.
(ii) The net book value of disposals is R$ 32,411 of which R$
78,010 are cost and R$ 45,599 are accumulated amortization. During
the three months period ended September 30, 2022, the Company
revised some softwares originated from acquired companies and
observed no future economic benefit is expected from them,
resulting in the write off of some related softwares in the net
book value of R$29,264 (R$73,182 are costs and R$43,918 are
accumulated amortization).
|
|
|
|
|
|
|
24
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
|
|
|
|
13. Payables to third parties |
Payables to third parties, in the amount of R$14,947,305
(R$13,217,150 as of December 31, 2021) correspond mainly to amounts
to be paid to merchants related to transactions carried out by
their card holders, net of the intermediation fees and discounts
applied. PagSeguro Brazil's average settlement terms agreed upon
with commercial establishments is up to 14 days.
Of the total amount of payables to third parties, R$832,343
(R$533,436 as of December 31, 2021) refer to the balance of
transactions settled on merchant's payment account and available to
be used by them and R$5,901,223 (R$5,167,577 as of December 31,
2021) refer to the balance of the clients maintained in their
banking accounts that are invested by the Company in Certificate of
Deposits with 30 days of maturity and interest average rate of 66%
of CDI (59% of CDI in December 2021).
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
|
|
|
|
Certificate of Deposit (i) |
10,185,903 |
|
2,510,818 |
|
Interbank deposits (ii) |
2,247,931 |
|
404,998 |
|
Corporate securities (iii) |
204,862 |
|
218,180 |
|
|
12,638,696 |
|
3,133,996 |
|
|
|
|
|
|
Current |
10,795,295 |
|
3,056,444 |
|
Non - Current |
1,843,401 |
|
77,552 |
(i)The
average return is 117% of CDI (163% of CDI in December 2021). From
the total amount, R$2,018,322 refer to certificate of deposits with
interest rates correlated to the IPCA (Brazilian inflation rates)
and fixed rates that started in 2022. For these certificates of
deposit, the Company entered into derivative financial instruments
(“Swaps”) with the specific objective of protecting said deposit
from fluctuations arising from inflation, changing IPCA and fixed
rates for CDI rates. In September 2022, the Company recorded the
net effects of the Swaps in the amount of R$13,877
(Note 26).
(ii)The
average return is 112% of CDI (118% of CDI in December
2021).
(iii)The
average return is 141% of CDI (152% of CDI in December
2021).
The maturity analysis of deposits based on due date of the
agreements (disregarding that some can be withdrawn at any time,
which is limited to the contracts with a due date of less than 365
days) is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
|
|
|
|
Due within 30 days |
1,139,741 |
|
|
646,232 |
|
|
Due within 31 to 120 days |
2,692,094 |
|
|
1,029,936 |
|
|
Due within 121 to 180 days |
1,822,017 |
|
|
313,008 |
|
|
Due within 181 to 360 days |
5,141,443 |
|
|
1,067,268 |
|
|
Due to 361 days or more days |
1,843,401 |
|
|
77,552 |
|
|
|
12,638,696 |
|
|
3,133,996 |
|
|
|
|
|
|
|
|
25
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
The changes in deposits were as follows:
|
|
|
|
|
|
|
On December 31,2020 |
766,086 |
|
Additions |
4,929,926 |
|
Withdraws |
(2,667,612) |
|
Interest |
105,596 |
|
On December 31,2021 |
3,133,996 |
|
Additions (i) |
20,535,001 |
|
Withdraws |
(11,438,329) |
|
Interest |
408,028 |
|
On September 30, 2022 |
12,638,696 |
(i)Increase
is mainly related to higher volume of deposits issued due to
attractiveness of interest rates paid.
|
|
|
|
15. Salaries and social security charges |
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
|
|
|
|
Payroll accruals (i)
|
145,233 |
|
75,151 |
|
Profit sharing
|
66,879 |
|
75,076 |
|
Payroll taxes (LTIP) (ii)
|
42,484 |
|
61,359 |
|
Social charges
|
34,940 |
|
39,200 |
|
Other
|
11,223 |
|
8,938 |
|
|
300,759 |
|
259,724 |
(i)Refers
to 13th
salary, provision for vacation, among others. Increase in September
30, 2022 is mainly related to the fact there was no
13th
salary provision in December 31, 2021.
(ii)Refers
to social charges and income tax over LTIP and LTIP goals balances.
A significant portion of the balances recorded as of December 31,
2021 was paid during the first quarter of 2022.
|
|
|
|
16. Taxes and contributions |
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021
|
|
|
|
|
|
Taxes |
|
|
|
|
Services tax and other (i)
|
178,356 |
|
171,902 |
|
Social integration program (ii)
|
29,234 |
|
26,832 |
|
Social contribution on revenues (ii)
|
199,872 |
|
164,330 |
|
Income tax and social contribution (iii)
|
2,771 |
|
31,865 |
|
Other
|
20,078 |
|
12,596 |
|
|
430,311 |
|
407,525 |
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
|
|
|
|
Judicial deposits (v) |
|
|
|
|
Services tax (i)
|
(160,225) |
|
(159,101) |
|
Social integration program (ii)
|
(27,484) |
|
(25,789) |
|
Social contribution on revenues (ii)
|
(169,135) |
|
(158,701) |
|
|
(356,844) |
|
(343,591) |
|
|
73,467 |
|
63,934 |
(i)Refers
to tax on revenues.
(ii)Refers
mainly to Social Integration Program (PIS) and Social Contribution
on Revenues (COFINS) charged on financial income.
(iii)Refers
to the income tax and social contribution payable.
(iv)The
PagSeguro Group obtained court decisions to deposit the amount
related to the payments in escrow for matters discussed in items
"i" and "ii" and above.
|
|
|
|
|
|
|
26
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
|
|
|
|
17. Provision for contingencies |
PagSeguro Group is party to labor and civil litigation in progress
and are discussing such matters at the administrative and judicial
levels, for which in some cases the PagSeguro Group has made
corresponding judicial deposits. The likelihood of a negative
outcome is assessed periodically and adjusted by management, when
appropriate. Such assessment considers the opinion of its external
legal advisors.
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2022 |
|
December 31, 2021 |
|
|
|
|
|
Civil |
36,451 |
|
33,343 |
|
Labor |
32,041 |
|
18,387 |
|
|
68,492 |
|
51,730 |
|
Labor Deposits |
(11,184) |
|
(10,167) |
|
|
(11,184) |
|
(10,167) |
|
|
|
|
|
|
|
57,308 |
|
41,563 |
|
Current |
42,782 |
|
27,653 |
|
Non-Current |
14,526 |
|
13,910 |
Below it is demonstrated the movements of the provision for
contingencies in the nine-month period ended September 30,
2022:
|
|
|
|
|
|
|
On December 31,2020 |
28,804 |
|
Accrual |
25,907 |
|
Settlement |
(17,760) |
|
Interest |
4,610 |
|
On December 31,2021 |
41,563 |
|
Accrual |
27,969 |
|
Settlement |
(17,139) |
|
Interest |
4,915 |
|
On September 30,2022 |
57,308 |
The movements of the labor deposits in the nine-month period ended
September 30, 2022 is mainly related to interest in the
period.
The PagSeguro Group is party to tax and civil lawsuits involving
risks classified as possible losses, for which no provision was
recognized on September 30, 2022, totaling R$592,568 (December 31,
2021 - R$504,691). The increase is mainly related to interest in
the period. The main tax and labor lawsuit classified as possible
losses are disclosed in our annual financial statements of the year
ended December 2021.
|
|
|
|
|
|
|
27
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
In November 2021, the PagSeguro Group entered in a US$180 million
borrowing agreement with maturity one year from the execution date
and the payment will occur in a single instalment at the due date.
At the moment the agreement was signed, the foreign exchange rate
was R$ 5.6227 per US dollar amounting in R$1,012,086. Interest on
the borrowing is paid at the maturity of the financing, together
with the total settlement of the financial instrument. On September
30, 2022, the borrowing amounted to R$986,695 (R$1,005,787 as of
December 31, 2021). The main impact of this decrease in the
borrowing is related to foreign exchange rate, which on September
30, 2022 was R$ 5.4066 per US dollar.
For the same financing, the Company entered into derivative
financial instruments (“Swaps”) for the borrowing in foreign
currency, with the specific objective of protecting said borrowing
from fluctuations arising from the exchange rate variation
mentioned above. The overall charges related to the financing,
considering all the costs of the operation, are equivalent to
109.4% of the CDI representing R$98,930 of interest recorded as
financial expenses in 2022. In September 2022, the Company recorded
the effects of the Swaps in the amount of R$143,136 basically
represented by the difference in foreign exchange rates at the time
of signing the borrowing agreement and September 2022, plus
interest. For more details about financial instruments, see note
26.
In February 2022, the Group entered in a R$250 million borrowing
agreement with maturity in three months from the execution date,
the interest rate is 112% of CDI and the payment would occur in a
single instalment as the due date. In May 2022, the borrowing
agreement was re-signed with new maturity for an additional three
months and was settled in August 2022 in the principal amount of
R$250 million and the interests paid were R$7,015 in May and
R$8,322 in August.
The proceeds from these borrowings were directed to working capital
for the Company’s ordinary course activities, and they are not
linked to satisfying other borrowing limits or
covenants.
The table below demonstrates the changes in the
borrowings:
|
|
|
|
|
|
|
On December 31,2020 |
— |
|
Additions |
1,012,086 |
|
Interest accrual |
8,018 |
|
Financial Instruments |
(14,317) |
|
On December 31,2021 |
1,005,787 |
|
Additions |
250,000 |
|
Interest accrual |
114,267 |
|
Payment of principal |
(250,000) |
|
Payment of interest |
(15,337) |
|
Financial Instruments (i) |
(118,022) |
|
On September 30,2022 |
986,695 |
(i)For
further details refer to note 26.
|
|
|
|
|
|
|
28
|
|
|
investors.pagseguro.com |
|
|
|
|
|
PagSeguro Digital Ltd. |
|
Notes to the unaudited condensed consolidated interim financial
statements
As of September 30, 2022 and for the three and nine-month periods
ended September 30, 2022 and 2021
(All amounts in thousands of reais unless otherwise
stated) |
|
|
|
|
19. Income tax and social contribution |
a)Reconciliation
of the deferred income tax and social contribution
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax losses |
|
Tax credit |
|
Technological inovation (i) |
|
Other temporary differences -assets (ii) |
|
Other temporary differences -liability (iii) |
|
Total |
|
|
|
|
|
|
|
< |