Sinqia S A : (SQIA3) releases its 3Q22 results

11/11/2022

Sinqia (SQIA3) releases its 3Q22 results

The company reports net revenue of R$ 159.5 million, an increase of 73.3% compared to the same period in 2021; Adjusted EBITDA reached R$ 40.8 million, consolidating the company's robustness.

São Paulo, November 10, 2022 - Sinqia (B3: SQIA3), the largest provider of technology and innovation for the financial sector, announced its financial results for the third quarter of 2022. The numbers reinforce the continuity of its growth and confirm the consistency of the company's business model, as well as the successful execution of this new Sinqia cycle.

The quarter began with the completion of the payment of R$ 100 million related to the second tranche of debentures issued in July 2021, strengthening the company's cash to take advantage of opportunities in its M&A pipeline. The period also saw improved margins through inorganic and organic growth, cross-selling growth and efficiency gains. "We reiterate the predictability of the results, which continue to evolve quarter after quarter with a superior performance than the rest of the market", points out Emerson Faria, Director of Investor Relations and ESG at Sinqia.

Faria's arrival is part of the movement that the company made during 2022 to prepare for the continuity of its growth. In August, in addition to the executive, Filipe Bodenmuller also arrived to reinforce the team and took over as Director of Strategy and M&A. In the last month, the company presented new names for its management team. Claudio Prado assumed the position of Vice President of Operations, being replaced by Carlos Furlan on the Board of Directors.

The company outperformed its own results in terms of operating and financial performance. Software ARR reached R$ 502.5 million, an increase of R$ 215.6 million (+75.1%) compared to 3Q21. "This is the result of the organic addition of R$ 63.5 million, and the inorganic addition of R$ 152.0 million, referring to the consolidation of the contract portfolios of the last acquisitions", points out Faria.

It is possible to highlight that the software ARR presented organic growth of 22.1% compared to the same period of 2021. It is important to highlight that 10.3% of this number corresponds to the addition of ARR of sales net of cancellations, and 11.9% of adjustments for inflation and volume, in line with the accumulated inflation for the period.

Another Sinqia record in the quarter was R$ 159.5 million in net revenue, a growth of 73.3% compared to the same period of the previous year. These numbers are the result of the 87.7% increase in Software (which resulted in R$ 134.8 million in the quarter) added to the 22% increase in Services (total of R$ 24.7 million in the period). Recurring revenue added up to R$ 133.1 million, which corresponds to 83.4% of total revenue.

Adjusted EBITDA was R$ 40.8 million, a growth of 145.7% compared to the third quarter of 2021, resulting in an adjusted EBITDA margin of 25.6%, 7.5pp. higher than that recorded in 3Q21. According to Sinqia's IR director, this performance is explained, mainly, by the consolidation of the results from the acquisitions carried out in the last quarters and by the scale gains obtained in the period. "The activation in the intangible of project development had a positive impact on adjusted EBITDA by R$ 2.3 million in this quarter", he adds.

The company focuses daily on making its work environment increasingly attractive and welcoming for its employees. As a result, it won the GPTW (Great Place to Work) certification for the fourth consecutive time, the best grade since it began participating in the survey in 2019. "We are happy with this collective achievement. We understand that great people build a great place to work" celebrates Faria.

The quarter's results reinforce the strength and solidity of the company's business model, thanks to a competent team and long experience in the market. "As we enter the final stretch of 2022 and are already thinking about the strategies for the next year, we remain confident in our work and are prepared to deliver ever-increasing and consistent results", concludes the executive.