TOTVS (TOTS3) investor relations material

Key financial highlights

• Net income for Q1 2026 was M$32,011, a 4% decrease from Q1 2025, mainly due to lower returns from the Encaje and higher depreciation and amortization expenses.

• Operating revenues grew 3% year-over-year to M$68,180, driven by higher commission income from mandatory contributions.

• The Encaje (statutory reserve) generated M$1,434 in returns, down 84% from the prior year, reflecting weaker pension fund performance.

• Total assets reached M$772,895 at March 2026, with a 0.15% increase from December 2025, and equity rose 5.6% to M$423,202.

• Liquidity and solvency ratios improved, with a current ratio of 0.95 and a debt-to-equity ratio of 0.83.

Operational and market performance

• The company maintained leadership in managed pension funds, holding 26.65% of the market and 14.11% of affiliates as of March 2026.

• In voluntary pension savings, it led with a 37.28% market share in assets and 20.54% in accounts.

• The cost per contributor increased 2.8% due to a decrease in contributors and higher average costs.

• The number of employees was 1,538 and sales agents 499 at quarter-end.

Risk, compliance, and legal matters

• The company recognized a M$3,202 provision for impaired receivables from insurance companies due to ongoing arbitration over additional pension funding.

• Provisions for legal contingencies and director compensation totaled M$945 at March 2026.

• No new sanctions were imposed in Q1 2026; two regulatory fines totaling 3,855 UF were received in 2025 for operational deficiencies.

• The company’s capital and reserves far exceed the legal minimum, with a net equity/capital minimum ratio of 531x.