Release Date: January 22, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you discuss the macro risks you see, particularly in Brazil, and how they might impact your operations? A: David Francis Nangle, CEO: We are aware of the macro implications in Brazil, including currency and peer valuations affecting our companies. Brazil experiences periodic economic fluctuations, but our companies are built to withstand these cycles. Creditas, for example, has shown no change in its 2025 plans, and while interest rates have fluctuated, the impact on margins has been manageable. We remain vigilant but confident in our portfolio's resilience.
Q: How has the year-to-date performance of the Brazilian real and peer benchmarks affected your valuations? A: David Francis Nangle, CEO: Year-to-date, the trends affecting our valuations, particularly for Creditas, are net positive. The Brazilian real has shown some recovery, and peer benchmarks have improved. We aim to be dynamic and real-time with our valuations, acknowledging inherent volatility, but recent trends are encouraging.
Q: There seems to be a revision in your growth projections for the portfolio. Can you explain the changes? A: Alexis Koumoudos, CIO: The revision from 40% and 60% growth in revenue and gross profit to 35% and 40% is due to our portfolio companies maturing. Larger companies like Creditas have reached more stable gross margin profiles, leading to growth in gross profit aligning more closely with revenue growth.
Q: Can you provide more details on the recent exits and their impact on your capital position? A: Alexis Koumoudos, CIO: We completed exits with BlackBuck and Gringo, bringing in $22.4 million in total. These exits strengthen our balance sheet, moving us closer to a net debt-neutral position. We continue to focus on selective exits to further enhance our financial flexibility.
Q: What are your plans for capital allocation following these exits? A: David Francis Nangle, CEO: Our capital allocation strategy focuses on strengthening the balance sheet, including debt reduction and share buybacks. We aim to leverage our cash position to create shareholder value, with a long-term view of reinvesting in high-quality opportunities as they arise.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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