Locaweb Serviços de Internet S.A.
Individual and consolidated interim financial information march 31, 2024
(A free translation of the original report in Portuguese containing financial statements prepared in accordance with the Brazilian and International standard on review Engagements (NBC TR 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity and ISRE 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively))
KPDS 1335223
Locaweb Serviços de Internet S.A. Individual and consolidated interim financial information on March 31, 2024
Contents
Report on review of quarterly information - ITR | 3 |
Interim statements of financial position | 5 |
Interim statements of result | 7 |
Interim statements of comprehensive income | 8 |
Interim statements of changes in shareholders' equity | 9 |
Interim statements of cash flows | 10 |
Interim statements of value add | 11 |
Notes to individual and consolidated interim financial information | 12 |
2
KPMG Auditores Independentes Ltda.
Rua Verbo Divino, 1400, Conjunto Térreo ao 801 - Parte, Chácara Santo Antônio, CEP 04719-911, São Paulo - SP Caixa Postal 79518 - CEP 04707-970 - São Paulo - SP - Brasil Telefone +55 (11) 3940-1500
kpmg.com.br
Report on review of quarterly information - ITR
To the Shareholders and Administrators of
Locaweb Serviços de Internet S.A.
São Paulo - SP
Introduction
We have reviewed the accompanying individual and consolidated interim financial information of Locaweb Serviços de Internet S.A. ("the Company"), contained in the Quarterly Financial Information Form (ITR) for the quarter ended March 31, 2024, comprising the statements financial position as of March 31, 2024, the respective statements of profit or loss, other comprehensive income, statements of changes in equity and cash flows for the three-month period then ended, including notes the financial statements.
Management is responsible for the preparation of the interim financial information in accordance with CPC 21(R1) and International Accounting Standard (IAS) 34 - Interim Financial Reporting, issued by International Accounting Standards Board - IASB, and for the presentation of this information in accordance with the standards issued by the Comissão de Valores Imobiliários, applicable to the preparation of the Quarterly Financial Information (ITR). Our responsibility is to express a conclusion on these interim financial information based on our review.
Scope of review
We conducted our review in accordance with the Brazilian and International Standard on Review Engagements (NBC TR 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity and ISRE 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively).
A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and, consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
KPMG Auditores Independentes Ltda., uma sociedade simples brasileira, de responsabilidade limitada e firma-membro da organização global KPMG de firmas-membro independentes licenciadas da KPMG International Limited, uma empresa inglesa privada de responsabilidade limitada.
KPMG Auditores Independentes Ltda., a Brazilian limited liability company and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.
3
Conclusion on the individual interim financial information
Based on our review, nothing has come to our attention that causes us to believe that the individual interim financial information included in the Quarterly Information referred above has not been prepared, in all material respects, in accordance with CPC 21 (R1), applicable to the preparation of Quarterly Information - ITR and presented in accordance with the standards issued by the Comissão de Valores Mobiliários.
Conclusion on the consolidated interim financial information
Based on our review, nothing has come to our attention that causes us to believe that the consolidated interim financial information included in the Quarterly Information referred above has not been prepared, in all material respects, in accordance with CPC 21 (R1) and IAS 34, applicable to the preparation of Quarterly Information - ITR and presented in accordance with the standards issued by the Comissão de Valores Mobiliários.
Other matters - Statements of added value
The interim financial information referred above comprise the statements of added value (DVA), individual and consolidated, for the three-month period ended March 31, 2024, prepared under the responsibility of Company's management, and presented as supplementary information for the purpose of IAS 34. These statements, were submitted to the review procedures performed together with the review of the Quarterly Financial Information, with the purpose to evaluate whether these are reconciled to the financial information and to accounting records, as applicable, and whether their form and content are in accordance with the criteria set on Technical Pronouncement CPC 09 - Statement of Added Value. Based on our review, nothing has come to our attention that causes us to believe that the statements of added value referred above have not been prepared, in all material respects, in accordance with the criteria defined in this Standard and consistently in relation to the interim financial information taken as a whole.
São Paulo, May 08, 2024
KPMG Auditores Independentes Ltda.
CRC 2SP-014428/O-6
Original report in Portuguese signed by
João Paulo A. Pacheco Neves
Accountant CRC 1SP222303/O-4
KPMG Auditores Independentes Ltda., uma sociedade simples brasileira, de responsabilidade limitada e firma-membro da organização global KPMG de firmas-membro independentes licenciadas da KPMG International Limited, uma empresa inglesa privada de responsabilidade limitada.
KPMG Auditores Independentes Ltda., a Brazilian limited liability company and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.
4
Locaweb Serviços de Internet S.A.
Interim statements of financial position as at March 31, 2024 and December 31, 2023
(In thousands of Reais)
Parent company | Consolidated | |||||||
Note: | 03/31/2024 | 12/31/2023 | 03/31/2024 | 12/31/2023 | ||||
Assets | ||||||||
Cash and cash equivalents | 3.1 | 938,886 | 949,283 | 1,126,301 | 1,188,223 | |||
Accounts receivable | 4.1 | 19,707 | 21,817 | 802,556 | 707,556 | |||
Taxes recoverable | 6,676 | 2,944 | 8,255 | 4,049 | ||||
Income tax and social contribution recoverable | 8,053 | 11,237 | 19,298 | 23,250 | ||||
Other assets | 5 | 25,925 | 17,750 | 41,231 | 27,315 | |||
Total current assets | 999,247 | 1,003,031 | 1,997,641 | 1,950,393 |
Financial assets | 3.2 |
Court deposits | 14 |
Other assets | 5 |
Deferred income tax and social contribution | 21 |
Total long-term assets
- | - | 17,630 | 16,617 |
402 | 402 | 619 | 498 |
6,109 | 5,396 | 8,983 | 8,284 |
136,399 | 130,213 | 200,406 | 182,807 |
142,910 | 136,011 | 227,638 | 208,206 |
Investments | 7 | 2,261,565 | 2,250,061 | - | - | |||
Property, plant, and equipment | 8 | 55,168 | 59,388 | 85,022 | 89,431 | |||
Intangible assets | 9 | 148,439 | 147,118 | 2,284,804 | 2,288,148 | |||
Right-of-use asset | 10 | 56,392 | 58,784 | 65,352 | 68,210 | |||
Total non-current assets | 2,664,474 | 2,651,362 | 2,662,816 | 2,653,995 | ||||
Total assets | 3,663,721 | 3,654,393 | 4,660,457 | 4,604,388 |
The accompanying notes are an integral part of the interim financial information.
5
Locaweb Serviços de Internet S.A.
Interim statements of financial position as at March 31, 2024 and December 31, 2023
(In thousands of Reais)
Parent company | Consolidated | |||||||
Note | 03/31/2024 | 12/31/2023 | 03/31/2024 | 12/31/2023 | ||||
Liabilities | ||||||||
Suppliers | 15,886 | 25,207 | 34,110 | 45,575 | ||||
Loans and financing | 12.1 | - | - | 18 | 60 | |||
Lease liabilities | 12.2 | 8,956 | 8,772 | 12,812 | 13,694 | |||
Salaries, charges, and social benefits | 13 | 41,546 | 37,495 | 120,592 | 108,366 | |||
Other taxes payable | 4,308 | 4,281 | 13,914 | 14,546 | ||||
Services to be provided | 4.2 | 47,622 | 48,867 | 95,335 | 94,717 | |||
Receivables to be transferred | - | - | 601,300 | 559,662 | ||||
Interest on equity and dividends payable | 5 | 5 | 5 | 5 | ||||
Taxes in installments | 11 | 261 | 256 | 3,114 | 3,065 | |||
Derivative financial instruments | 23.g | 160 | - | 160 | - | |||
Obligation with investment acquisitions | 7.1 | 437,874 | 440,218 | 574,917 | 575,093 | |||
Other liabilities | 3,257 | 5,491 | 22,962 | 26,770 | ||||
Total current liabilities | 559,875 | 570,592 | 1,479,239 | 1,441,553 | ||||
Lease liabilities | 12.2 | 56,358 | 58,667 | 61,866 | 63,675 | |||
Services to be provided | 4.2 | 5,103 | 2,971 | 5,103 | 2,971 | |||
Taxes in installments | 11 | 1,153 | 1,196 | 13,836 | 14,270 | |||
Obligation with investment acquisitions | 7.1 | 136,292 | 132,446 | 187,499 | 186,111 | |||
Provision for contingencies | 14 | 2,853 | 3,071 | 5,850 | 6,168 | |||
Provision for investment losses | 7 | 2,258 | 3,304 | - | - | |||
Deferred income tax and social contribution | 21 | - | - | 5,733 | 6,002 | |||
Other liabilities | - | - | 1,502 | 1,492 | ||||
Total non-current liabilities | 204,017 | 201,655 | 281,389 | 280,689 | ||||
Net equity | ||||||||
Share capital | 15 | 2,940,141 | 2,940,141 | 2,940,141 | 2,940,141 | |||
Treasury shares | 15 | (72,935) | (63,218) | (72,935) | (63,218) | |||
Capital reserves | 15 | 80,110 | 77,074 | 80,110 | 77,074 | |||
Other comprehensive income | (106) | - | (106) | - | ||||
Accumulated losses | (47,381) | (71,851) | (47,381) | (71,851) | ||||
Total net equity | 2,899,829 | 2,882,146 | 2,899,829 | 2,882,146 | ||||
Total liabilities and net equity | 3,663,721 | 3,654,393 | 4,660,457 | 4,604,388 |
The accompanying notes are an integral part of the interim financial information.
6
Locaweb Serviços de Internet S.A.
Interim statements of result
Three-month period ended March 31, 2024 and 2023
(In thousands of Reais)
Parent company | Consolidated | |||||||
Notes | 01/01/2024 to | 01/01/2023 to | 01/01/2024 to | 01/01/2023 to | ||||
03/31/2024 | 03/31/2023 | 03/31/2024 | 03/31/2023 | |||||
Net operating revenue | 18 | 80,986 | 89,166 | 320,612 | 302,847 | |||
Cost of services provided | 19 | (53,660) | (63,548) | (168,077) | (159,259) | |||
Gross profit | 27,326 | 25,618 | 152,535 | 143,588 | ||||
Operating revenues (expenses) | ||||||||
Sales expenses | 19 | (11,575) | (11,842) | (67,072) | (63,327) | |||
General and administrative expenses | 19 | (7,213) | (7,663) | (59,896) | (57,945) | |||
Loss due to impairment | 19 | (527) | (335) | (2,626) | (1,296) | |||
Equity income | 7 | 3,137 | (6,404) | - | - | |||
Other operating revenues (expenses) | 19 | 26 | 56 | 667 | 202 | |||
(16,152) | (26,188) | (128,927) | (122,366) | |||||
Income before net financial revenues (expenses) | 11,174 | (570) | 23,608 | 21,222 | ||||
Financial revenues | 20 | 26,944 | 38,614 | 34,687 | 43,048 | |||
Financial expenses | 20 | (7,934) | (27,112) | (25,436) | (49,181) | |||
Net financial income (expenses) | 19,010 | 11,502 | 9,251 | (6,133) | ||||
Income before income tax and social contribution | 30,184 | 10,932 | 32,859 | 15,089 | ||||
Current income tax and social contribution | 21 | (11,846) | (11,131) | (26,203) | (23,232) | |||
Deferred income tax and social contribution taxes | 21 | 6,132 | 7,432 | 17,814 | 15,376 | |||
(5,714) | (3,699) | (8,389) | (7,856) | |||||
Net profit for the period | 24,470 | 7,233 | 24,470 | 7,233 | ||||
Earnings per share | ||||||||
(expressed in BRL per share) | ||||||||
Basic profit per share | 17 | 0.04 | 0.01 | |||||
Diluted profit per share | 17 | 0.04 | 0.01 |
The accompanying notes are an integral part of the interim financial information.
7
Locaweb Serviços de Internet S.A.
Interim statements of comprehensive income
Three-month period ended March 31, 2024 and 2023
(In thousands of Reais)
Parent company | Consolidated | ||||||
01/01/2024 to | 01/01/2023 to | 01/01/2024 to | 01/01/2023 to | ||||
03/31/2024 | 03/31/2023 | 03/31/2024 | 03/31/2023 | ||||
Net profit for the period | 24,470 | 7,233 | 24,470 | 7,233 | |||
Other comprehensive income | |||||||
Cash flow hedge | 160 | - | 160 | - | |||
Deferred taxes on cash flow hedges | (54) | - | (54) | - | |||
Comprehensive income for the period | 24,576 | 7,233 | 24,576 | 7,233 |
The accompanying notes are an integral part of the interim financial information.
8
Locaweb Serviços de Internet S.A.
Interim statements of changes in shareholders' equity
Three-month period ended March 31, 2024 and 2023
(In thousands of Reais)
Share capital | Treasury shares | Capital Reserves | Profit Reserves | |||||||||||||||||||||||||
Capital | Expenses | Stock | Goodwill | Other | ||||||||||||||||||||||||
Paid up | stock | with the | Goodwill on | option | on the | Profit | comprehensive | Accumulated | ||||||||||||||||||||
capital | yet to be | issuance | capital | plan | issuance of | retention | income | (Losses) | ||||||||||||||||||||
stock | paid in | of shares | Treasury shares | transactions | reserve | shares | Legal reserve | reserve | profits | Total net equity | ||||||||||||||||||
Balances on December 31, 2022 | 3,006,937 | 3,495 | (76,201) | (47,481) | (22,344) | 73,771 | 11,895 | 3,892 | 23,623 | - | - | 2,977,587 | ||||||||||||||||
Net income for the period | - | - | - | - | - | - | - | - | - | - | 7,233 | 7,233 | ||||||||||||||||
Total comprehensive income for the period | - | - | - | - | - | - | - | - | - | - | 7,233 | 7,233 | ||||||||||||||||
Capital increase | 3,495 | (3,495) | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||
Share-based payments | - | - | - | - | - | 1,471 | - | - | - | - | - | 1,471 | ||||||||||||||||
Balances on March 31, 2023 | 3,010,432 | - | (76,201) | (47,481) | (22,344) | 75,242 | 11,895 | 3,892 | 23,623 | - | 7,233 | 2,986,291 | ||||||||||||||||
Balances on December 31, 2023 | 3,013,866 | 2,476 | (76,201) | (63,218) | (22,344) | 87,523 | 11,895 | - | - | - | (71,851) | 2,882,146 | ||||||||||||||||
Net income for the period | - | - | - | - | - | - | - | - | - | - | 24,470 | 24,470 | ||||||||||||||||
Cash flow hedge | - | - | - | - | - | - | - | - | - | (106) | - | (106) | ||||||||||||||||
Total comprehensive income for the period | - | - | - | - | - | - | - | - | - | (106) | 24,470 | 24,364 | ||||||||||||||||
Capital increase (Note 15.a) | 2,476 | (2,476) | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||
Repurchase of own shares | - | - | - | (9,717) | - | - | - | - | - | - | - | (9,717) | ||||||||||||||||
Share-based payments | - | - | - | - | - | 3,036 | - | - | - | - | - | 3,036 | ||||||||||||||||
Balances on March 31, 2024 | 3,016,342 | - | (76,201) | (72,935) | (22,344) | 90,559 | 11,895 | - | - | (106) | (47,381) | 2,899,829 |
The accompanying notes are an integral part of the interim financial information.
9
Locaweb Serviços de Internet S.A.
Interim statements of cash flows
Three-month period ended March 31, 2024 and 2023
(In thousands of Reais)
Note | Parent company | Consolidated | |||||||
01/01/2024 to | 01/01/2023 to | 01/01/2024 to | 01/01/2023 to | ||||||
03/31/2024 | 03/31/2023 | 03/31/2024 | 03/31/2023 | ||||||
Cash flows from operating activities | |||||||||
Profit before income tax and social contribution | 30,184 | 10,932 | 32,859 | 15,089 | |||||
Adjustments to reconcile profit (loss) before income tax and social | |||||||||
contribution with net cash flow from operating activities: | |||||||||
Depreciation and amortization | 8;9;10 | 11,757 | 11,865 | 31,552 | 29,005 | ||||
Equity income | 7 | (3,137) | 6,404 | - | - | ||||
Passive lease interest, derivatives, exchange and monetary | |||||||||
variations | 1,344 | 1,127 | 1,316 | 1,077 | |||||
Remeasurement fair value of contingent consideration | 7.1 | 4,641 | 24,007 | 7,081 | 29,687 | ||||
Share-based payments | 16 | 2,326 | 936 | 3,427 | 1,487 | ||||
Provisions and other adjustments | 102 | 849 | (3,190) | 1,589 | |||||
Changes in assets and liabilities | |||||||||
Accounts receivable from customers | 1,790 | 447 | (93,266) | 6,502 | |||||
Taxes recoverable | (548) | 5,252 | 1,811 | 8,010 | |||||
Other assets | (8,888) | (2,107) | (14,615) | (3,312) | |||||
Court deposits | - | - | (121) | 6 | |||||
Suppliers | (2,966) | (2,794) | (5,197) | (1,495) | |||||
Salaries, charges, and social benefits | 3,939 | 1,741 | 11,835 | 4,409 | |||||
Other taxes payable | (3,553) | (3,371) | (7,099) | (6,672) | |||||
Services to provide | 887 | 2,267 | 2,750 | 2,079 | |||||
Receipts to be passed on | - | - | 41,638 | (26,749) | |||||
Other liabilities | (2,234) | (217) | (3,798) | 1,076 | |||||
Income tax and social contribution paid | (8,304) | (7,116) | (21,854) | (16,000) | |||||
Net cash from operating activities | 27,340 | 50,222 | (14,871) | 45,788 | |||||
Cash flows from investing activities | |||||||||
Acquisitions of property, plant and equipment | (7,359) | (7,959) | (10,200) | (10,360) | |||||
Obligation with the acquisition of investments | 7.1 | (3,139) | (6,252) | (5,869) | (34,530) | ||||
Capital increase in subsidiary | 7 | (8,591) | (51,480) | - | - | ||||
Financial Assets | - | - | - | (3,749) | |||||
Acquisition and development of intangible assets | 9 | (5,462) | (4,602) | (16,327) | (14,578) | ||||
Net cash used in investing activities | (24,551) | (70,293) | (32,396) | (63,217) | |||||
Cash flows from financing activities | |||||||||
Payment of lease liabilities | 12.2 | (3,469) | (3,053) | (4,892) | (4,433) | ||||
Loans and financing paid | 23.f | - | - | (42) | (179) | ||||
Interest and exchange variation paid | 23.f | - | - | (4) | (9) | ||||
Repurchase of own shares | (9,717) | - | (9,717) | - | |||||
Net cash (used in) generated by financing activities | (13,186) | (3,053) | (14,655) | (4,621) | |||||
(Reduction) net increase in cash and cash equivalents | (10,397) | (23,124) | (61,922) | (22,050) | |||||
Cash and cash equivalents at the start of the period | 949,283 | 1,309,361 | 1,188,223 | 1,448,231 | |||||
Cash and cash equivalents at the end of the period | 938,886 | 1,286,237 | 1,126,301 | 1,426,181 | |||||
(Reduction) net increase in cash and cash equivalents | (10,397) | (23,124) | (61,922) | (22,050) |
The accompanying notes are an integral part of the interim financial information.
10
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Locaweb Serviços de Internet SA published this content on 09 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 May 2024 22:14:29 UTC.