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StoneCo(STNE) - 2024 Q4 - Annual Report
STNEStoneCo(STNE)2025-03-18 21:12

Financial Performance - Total revenue and income for 2024 reached R13,257,454thousand,anincreasefromR 13,257,454 thousand, an increase from R 12,055,003 thousand in 2023, representing a growth of approximately 10%[17] - The company reported a net loss of R1,507,050thousandfor2024,comparedtoanetincomeofR 1,507,050 thousand for 2024, compared to a net income of R 1,600,420 thousand in 2023, indicating a significant decline in profitability[17] - Goodwill impairment loss related to the Software cash generating unit amounted to R3,558,049thousand,impactingoverallfinancialperformance[17]−Othercomprehensiveincomefortheyear,netoftax,wasBRL32,795thousandin2024,downfromBRL111,427thousandin2023[20]−Totalcomprehensiveincome(loss)fortheyear,netoftax,wasBRL(1,474,255)thousandin2024,comparedtoBRL1,711,847thousandin2023[20]−ThecompanyexperiencedalossofBRL1,481,821thousandattributabletocontrollingshareholdersin2024,comparedtoagainofBRL1,704,317thousandin2023[20]AssetsandLiabilities−TotalassetsgrewtoR 3,558,049 thousand, impacting overall financial performance[17] - Other comprehensive income for the year, net of tax, was BRL 32,795 thousand in 2024, down from BRL 111,427 thousand in 2023[20] - Total comprehensive income (loss) for the year, net of tax, was BRL (1,474,255) thousand in 2024, compared to BRL 1,711,847 thousand in 2023[20] - The company experienced a loss of BRL 1,481,821 thousand attributable to controlling shareholders in 2024, compared to a gain of BRL 1,704,317 thousand in 2023[20] Assets and Liabilities - Total assets grew to R 54,813,463 thousand in 2024, up from R48,693,561thousandin2023,indicatingarobustassetbase[14]−Thecompany’stotalliabilitiesincreasedtoR 48,693,561 thousand in 2023, indicating a robust asset base[14] - The company’s total liabilities increased to R 42,986,181 thousand in 2024 from R34,017,601thousandin2023,reflectinghigherfinancialobligations[14]−Thecompany′sequityattributabletocontrollingshareholdersdecreasedtoR 34,017,601 thousand in 2023, reflecting higher financial obligations[14] - The company's equity attributable to controlling shareholders decreased to R 11,775,984 thousand in 2024 from R14,622,264thousandin2023,showingadeclineinshareholdervalue[15]CashFlowandLiquidity−CashandcashequivalentsincreasedtoR 14,622,264 thousand in 2023, showing a decline in shareholder value[15] Cash Flow and Liquidity - Cash and cash equivalents increased to R 5,227,654 thousand in 2024 from R2,176,416thousandin2023,reflectingimprovedliquidity[14]−Netcashprovidedbyoperatingactivitieswasnegativeat3,621,382thousandBrazilianReaisin2024,adeclinefrom1,647,708thousandin2023[27]−Thetotalcashandcashequivalentsattheendof2024were5,227,654thousandBrazilianReais,upfrom2,176,416thousandin2023,indicatingachangeof3,051,238thousand[27]FinancialOperations−Financialincomefor2024wasR 2,176,416 thousand in 2023, reflecting improved liquidity[14] - Net cash provided by operating activities was negative at 3,621,382 thousand Brazilian Reais in 2024, a decline from 1,647,708 thousand in 2023[27] - The total cash and cash equivalents at the end of 2024 were 5,227,654 thousand Brazilian Reais, up from 2,176,416 thousand in 2023, indicating a change of 3,051,238 thousand[27] Financial Operations - Financial income for 2024 was R 7,676,204 thousand, an increase from R6,229,303thousandin2023,highlightinggrowthinfinancialoperations[17]−RetaildepositsrosetoR 6,229,303 thousand in 2023, highlighting growth in financial operations[17] - Retail deposits rose to R 8,704,809 thousand in 2024, compared to R6,119,455thousandin2023,indicatingincreasedcustomertrustanddeposits[14]−Theaverageannualgrowthrateusedintheimpairmenttestwassensitive,affectingthevaluationoftheSoftwarecashgeneratingunit[10]InvestmentsandSubsidiaries−TheGroupincorporatedseveralnewcompaniesin2024,includingStoneSCFI,SponteEducac\ca~o,LinxAuto,andLinxImpulse,allofwhicharewhollyowned[103]−TheGroup′sequityinterestinAgilizedecreasedfrom33.33 6,119,455 thousand in 2023, indicating increased customer trust and deposits[14] - The average annual growth rate used in the impairment test was sensitive, affecting the valuation of the Software cash generating unit[10] Investments and Subsidiaries - The Group incorporated several new companies in 2024, including Stone SCFI, Sponte Educação, Linx Auto, and Linx Impulse, all of which are wholly owned[103] - The Group's equity interest in Agilize decreased from 33.33% to 28.70% following a corporate reorganization in November 2024[104] - The Group holds a 50% equity interest in Questor, which acquired a 75.60% equity interest in Hubcount[95] Financial Instruments and Risk Management - Derivative financial instruments are used by the Group as part of its risk management strategy to hedge against fluctuations in exchange rates and interest rates[149] - The Group applies cash flow hedge accounting to protect against future cash flow fluctuations, with gains or losses recognized in equity and profit or loss as appropriate[155] - Financial instruments are measured at fair value at each reporting date, categorized within a fair value hierarchy based on the inputs used for measurement[146] Credit and Allowances - The allowance for expected credit losses for accounts receivable from card issuers was R 60,888 in 2024, compared to R55,619in2023,reflectinganincreaseofapproximately9.1 55,619 in 2023, reflecting an increase of approximately 9.1%[176] - The net credit portfolio after allowance for expected credit losses reached R 1,063,119 in 2024, a substantial rise from R250,747in2023,markinganincreaseofaround323.5 250,747 in 2023, marking an increase of around 323.5%[179] - The Group calculates expected credit losses (ECL) for its loans based on statistical models considering internal and external historical data, with a three-stage approach for credit risk assessment[161] Funding and Debt - The company raised 6,585,937 thousand Brazilian Reais from institutional deposits and marketable debt securities in 2024, a substantial increase from 1,608,162 thousand in 2023[27] - The total debentures, financial bills, and commercial papers increased to R 4,079,266,000 in 2024 from R$ 1,116,252,000 in 2023, showing a growth of approximately 267%[188] - The company issued bonds in 2021, raising USD 500 million in seven-year notes with a final yield of 3.95%, and repurchased approximately 60% of the outstanding bonds during 2024[194] Regulatory and Compliance - The Group's consolidated financial statements are prepared in accordance with IFRS Accounting Standards, ensuring compliance with international financial reporting standards[38] - The Group is subject to a corporate tax surcharge (Additional CSLL) starting January 1, 2025, affecting multinational companies with annual revenue exceeding €750 million, with a minimum effective tax rate of 15% on adjusted income[77] - The Group has adopted IAS 29 for its Argentine subsidiary Napse S.R.L. due to the hyperinflationary economy, impacting the financial reporting of non-monetary assets and liabilities[58]