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Brazil's Buffett-backed StoneCo nearly doubles profits on more users, bigger prices
© Reuters.
SAO PAULO (Reuters) - Brazil's StoneCo nearly doubled its third quarter profit, the payments firm said on Thursday, as it posted earnings that surged past analyst forecasts on the back of higher prices and a bigger user base.
The firm, backed by U.S. billionaire investor Warren Buffett, posted adjusted net profit up 90% from a year earlier at 163 million reais, well ahead of the 95.7 million reais forecasts by analysts polled by Refinitiv.
Its active client base grew 71% from a year earlier to 2.37 million people, helping a drive revenues up to 2.5 billion reais, also a 71% increase.
Finance chief Rafael Martins told Reuters that the results were also driven by price hikes, reflecting Brazil's higher interest rates: "The repricing initiatives proved more successful than in our initial projections," he said.
However, higher interest rates also pushed up the group's financial expenses 184% to 940.3 million reais.
StoneCo said its financial expenses as a proportion of revenues had however "begun to normalize" after growing in the second quarter, pointing to "a positive trend we will continue to see growing forward."
Earlier this month, a Brazil central bank director flagged possible interest rate cuts from next June, after the lender held rates a 13.75% cycle-high in October.
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