Dotz (DOTZ3) Q1 2024 earnings summary

Executive summary

• 1Q24 brought EBITDA to a R$0.9m loss, improving R$15.0m YoY, alongside improved cost efficiency and continued Techfin growth.

• Techfin credit revenue grew 80% YoY, origination rose 68%, and cumulative NoVerde loans reached R$1bn.

• Retail point redemptions increased 23% YoY, with positive early usage indicators for Dotz Parcela.

Financial highlights

• Total billings were R$62.0m, down 6.4% YoY and 15.3% QoQ; net revenue before redemption costs was R$61.9m, up 3.3% YoY, and net revenue was R$36.1m, up 19.2%.

• Gross profit reached R$28.8m, up 12.0% YoY; gross margin was 46.5%, up 3.6 percentage points YoY.

• Operating loss improved to R$8.1m from R$23.7m YoY; net loss narrowed to R$10.2m from R$15.5m.

• SG&A was R$29.7m, down 28.6% YoY and 2.4% QoQ, reflecting expense optimization.

• Loss per share was R$0.77 versus R$1.17 in 1Q23.

Outlook and guidance

• Priorities include expanding Techfin products, consolidating Loyalty and coalition partnerships, and deepening ecosystem integration.

• POS and SuperApp journey redesign aims to increase engagement and digitalization and create cross-selling opportunities for financial products.

• Dotz Parcela was in final soft-launch testing; management described it as ready to scale based on early partner results and repeat usage.

• Management projected no liquidity risk for the 12 months after March 31, 2024, considering projected cash flows, financing access and the non-cash portion of deferred revenue liabilities.