Valid Soluções (VLID3) Q2 2024 earnings summary

Executive summary

• Net revenue for Q2 2024 was R$518 million, up 7% sequentially but down 3% year-over-year, with core business and new lines contributing 8.5% of total sales.

• Net income in Q2 2024 was R$80 million, up 43–44% year-over-year, with a margin of 15% and strong cash conversion.

• EBITDA for Q2 2024 was R$129 million, down 4% year-over-year but up 11% from Q1 2024, with a margin of 25%.

• Robust capital structure with net cash of R$137 million at end-1H24 and negative net debt/EBITDA ratio.

• Dividend payments continued, with R$51–52 million paid in 2024 and R$35 million scheduled for August.

Financial highlights

• Net revenue for 1H24 was R$1.0 billion, down 6% year-over-year.

• 1H24 net income reached R$227–228 million, boosted by a R$137 million gain from Cubic asset sale.

• Operational cash generation in Q2 2024 was R$133–173 million, representing 134% of EBITDA.

• CapEx for Q2 2024 was R$19 million; 1H24 CapEx was R$32 million.

• EPS for Q2 2024 was R$0.97, up 38% year-over-year.

Outlook and guidance

• Focus on extracting value from core activities and accelerating new revenue streams, with investment in innovation and operational excellence.

• Mobile segment expected to continue recovery in H2 2024; digital government and onboarding solutions to ramp up.

• Positive revenue expectations for 2H24, supported by new products and projects.