EX-99.1 2 tm2323946d1_ex99-1.htm EXHIBIT 99.1

Exhibit 99.1

 

EARNINGS RELEASE 2Q23

 

RESPONSE SEGMENT

 

BRL million  2Q23   2Q22   Chg.   1Q23*   Chg.   6M23*   6M22   Chg. 
GROSS REVENUE   660.4    363.3    81.8%    627.1    5.3%    1,287.5    713.7    80.4% 
DEDUCTIONS   -48.3    -30.7    57.3%    -30.9    56.3%    -79.2    -59.2    33.8% 
NET REVENUE   612.1    332.6    84.0%    596.3    2.7%    1,208.3    654.5    84.6% 
COST OF SERVICES PROVIDED   -454.1    -243.6    86.5%    -452.1    0.4%    -906.3    -472.6    91.8% 
GROSS PROFIT   157.9    89.1    77.4%    144.1    9.6%    302.1    182.0    66.0% 
GROSS MARGIN   25.8%    26.8%    -1.0 p.p.    24.2%    1.6 p.p.    25.0%    27.8%    -2.8 p.p. 
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES   -7.6    -6.5    17.5%    -5.1    49.4%    -12.7    -14.0    -9.7% 

 

GROSS REVENUE

 

RESPONSE
COMPOSITION OF
GROSS REVENUE
R$ million		  2Q21   3Q21   4Q21   1Q22   2Q22   3Q22   4Q22   1Q23   2Q23 
GROSS REVENUE   215.2    262.4    281.5    350.4    363.3    431.8    667.8    627.1    660.4 
Brazil   70.1    82.2    77.1    112.5    122.8    159.4    202.5    208.7    244.5 
International   145.1    180.2    204.4    237.9    240.6    272.4    465.3    418.4    415.9 
Latam (ex Brazil)   36.9    47.7    50.1    57.9    58.7    44.1    50.3    55.8    54.3 
Europe   42.4    50.1    48.1    47.8    50.5    51.8    64.7    56.1    46.0 
North America   65.8    82.4    106.2    132.2    131.3    176.5    350.3    306.5    315.5 

 

Our operations had revenue variations as expected. Gross revenue reached R$660 million in 2Q23, 81.8% higher than 2Q22 and up by 5.3% compared to 1Q23.

 

BRAZIL

 

COMPOSITION OF
GROSS REVENUE
R$ million		  2Q23   2Q22   Chg.
2Q23 x
2Q22		   1Q23   Chg.
2Q23 x
1Q23		   6M23   6M22   Chg.
6M23 x
6M22		 
RESPONSE                                        
GROSS REVENUES   660.4    363.3    81.8%    627.1    5.3%    1,287.5    713.7    80.4% 
Brazil   244.5    122.8    99.1%    208.7    17.1%    453.2    235.3    92.6% 
Subscriptions Brazil   39.6    33.7    17.3%    38.2    3.6%    77.8    67.5    15.3% 
Services Brazil   204.9    89.0    130.1%    170.5    20.2%    375.5    167.8    123.7% 

 

 

 

 

Attended Services     2Q22   3Q22   4Q22   1Q23   2Q23   Chg.
2Q23 x
2Q22		 
Brazil  Gross Revenue (BRL Million)  89.0   123.5   165.5   170.5   204.9   130.1% 
   Number of Services Provided  1,853   2,435   2,594   2,727   3,075   65.9% 
   Average Ticket (BRL Thousand)  48.1   50.7   63.8   62.5   66.6   38.7% 

 

·Gross Revenue in Brazil grew in all comparisons, mainly driven by the provision of scheduled industrial services and emergencies in the road and rail sectors.
·The average ticket rose YoY and QoQ reflecting higher complexity of attended services.
·This result is the result of integration and cross-selling between the business areas.

 

LATAM

 

COMPOSITION OF
GROSS REVENUE
R$ million		  2Q23   2Q22   Chg.
2Q23 x
2Q22		   1Q23   Chg.
2Q23 x
1Q23		   6M23   6M22   Chg.
6M23 x
6M22		 
RESPONSE                                        
GROSS REVENUES   660.4    363.3    81.8%    627.1    5.3%    1,287.5    713.7    80.4% 
International   415.9    240.6    72.9%    418.4    -0.6%    834.3    478.4    74.4% 
Latam (ex-Brazil)   54.3    58.7    -7.5%    55.8    -2.6%    110.1    116.6    -5.5% 
Subscriptions Latam   34.6    34.4    0.5%    36.1    -4.1%    70.7    65.6    7.7% 
Services Latam   19.7    24.3    -18.7%    19.7    0.1%    39.5    51.0    -22.6% 

 

 

Attended Services     2Q22   3Q22   4Q22   1Q23   2Q23   Chg.
2Q23 x
2Q22		 
Latam (Ex Brazil)  Gross Revenue (BRL Million)  24.3   9.6   14.8   19.7   19.7   -18.7% 
   Number of Services Served  82   80   104   95   90   9.8% 
   Average Ticket (BRL Thousand)  296.4   119.6   142.3   207.6   219.4   -26.0% 

 

·Latam gross revenue had a negative exchange rate impact between 1Q23 vs. 2Q23, due to the 3.4% appreciation of the Real against the Chilean Peso. On a Local currency view, Revenues showed slight growth.
·In Latin America, we had a YoY retraction due to exchange variation, and an oil spill response in the region during 1H22.

 

 

 

 

EUROPE

 

COMPOSITION OF
GROSS REVENUE
R$ million		  2Q23   2Q22   Chg.
2Q23 x
2Q22		   1Q23   Chg.
2Q23 x
1Q23		   6M23   6M22   Chg.
6M23 x
6M22		 
RESPONSE                                        
GROSS REVENUES   660.4    363.3    81.8%    627.1    5.3%    1,287.5    713.7    80.4% 
International   415.9    240.6    72.9%    418.4    -0.6%    834.3    478.4    74.4% 
Europe   46.0    50.5    -8.9%    56.1    -17.9%    102.1    98.3    3.9% 
Subscriptions Europe   4.6    3.8    20.5%    4.8    -4.9%    9.4    7.4    27.1% 
Services Europe   41.5    46.7    -11.3%    51.3    -19.1%    92.7    90.9    2.0% 

 

 

Attended Services     2Q22   3Q22   4Q22   1Q23   2Q23   Chg.
2Q23 x
2Q22		 
Europe  Gross Revenue (BRL Million)  46.7   48.1   60.0   51.3   41.5   -11.3% 
   Number of Services Served  5,874   5,922   5,974   5,947   5,798   -1.3% 
   Average Ticket (BRL Thousand)  8.0   8.1   10.0   8.6   7.2   -10.1% 

 

·In Europe, we had a quarterly drop in revenue, due to a lower industrial demand.
·In addition, the Real appreciated against the basket of currencies in the European countries where we operate.

 

NORTH AMERICA

 

COMPOSITION OF
GROSS REVENUE
R$ million		  2Q23   2Q22   Chg.
2Q23 x
2Q22		   1Q23   Chg.
2Q23 x 1Q23		   6M23   6M22   Chg.
6M23 x
6M22		 
RESPONSE                                        
GROSS REVENUES   660.4    363.3    81.8%    627.1    5.3%    1,287.5    713.7    80.4% 
International   415.9    240.6    72.9%    418.4    -0.6%    834.3    478.4    74.4% 
North America   315.5    131.3    140.2%    306.5    2.9%    622.0    263.5    136.0% 

 

 

Attended Services     2Q22   3Q22   4Q22   1Q23   2Q23   Chg.
2Q23 x
2Q22		  
North America  Gross Revenue (BRL Million)  131.3   176.5   350.3   306.5   315.5   140.2%  
   Number of Services Served  2,597   2,991   3,117   3,228   3,660   40.9%  
   Average Ticket (BRL Thousand)  50.6   59.0   112.4   95.0   86.2   70.5%  

 

·North America ex-WOB operations continue their growth trajectory. In the comparison with 2Q22, the growth was 140.2%.
·Continuing the process of integrating operations in North America, Witt O’Brien’s now brings together all the L1 and L2 US operations. So, we consolidate WOB into the North America revenue line. We continue to cross-sell L3 from leads generated by L1.
·Standing out in Canada was its performance in the Oil and Gas market, in addition to fire response, maintenance and cleaning of silos in the agricultural market.

 

 

 

 

NET REVENUE

 

R$ million  2Q23   2Q22   Chg.   1Q23   Chg.   6M23   6M22   Chg. 
Gross Revenues   660.4    363.3    81.8%    627.1    5.3%    1,287.5    713.7    80.4% 
Deductions   -48.3    -30.7    57.3%    -30.9    56.3%    -79.2    -59.2    33.8% 
Net Revenues   612.1    332.6    84.0%    596.3    2.7%    1,208.3    654.5    84.6% 
% Deductions / Gross Revenues   -7.3%    -8.5%    1.1 p.p.    -4.9%    -2.4 p.p.    -6.1%    -8.3%    2.1 p.p. 

 

·The variation in net revenue accompanied the evolution of gross revenue by geography, and the revenue deductions for each region. There was no significant change in the tax structure of each market, with higher deductions in the Brazilian market than in the international market.

 

COST OF PRODUCTS/SERVICES (CASH)

 

RESPONSE
COST OF SERVICES R$ million  2Q23   2Q22   Chg.    1Q23   Chg.    6M23   6M22   Chg.  
Personnel   253.4    120.2   110.9%     237.6   6.6%     491.0    238.2   106.2%  
Third parties   92.2    49.5   86.1%     88.8   3.8%     181.0    96.4   87.8%  
Maintenance   24.7    8.1   207.1%     19.8   24.6%     44.6    14.7   203.2%  
Travel   19.2    4.6   313.3%     17.2   11.7%     36.4    9.2   293.6%  
Freight   0.8    1.2   -32.1%     1.5   -45.6%     2.2    2.3   -2.6%  
Rentals   11.7    9.5   23.2%     10.7   9.4%     22.4    19.1   17.2%  
Fuel   12.8    18.7   -31.7%     12.6   1.6%     25.3    30.9   -17.9%  
Materials   5.2    3.5   46.3%     7.9   -35.1%     13.1    6.8   93.2%  
Telecommunications   2.9    0.6   406.5%     3.7   -22.7%     6.6    1.2   439.0%  
Marketing   5.3    0.7   656.4%     3.1   71.5%     8.4    1.2   583.0%  
Taxes   4.2    6.2   -32.3%     10.8   -61.1%     15.1    15.6   -3.3%  
Others   21.9    20.8   5.3%     38.4   -43.0%     60.2    37.0   62.6%  
TOTAL   454.1    243.6   86.5%     452.1   0.4%     906.3    472.6   91.8%  

 

RESPONSE
COST OF SERVICES R$ million  2Q21   3Q21   4Q21   1Q22   2Q22   3Q22   4Q22   1Q23   2Q23 
Net Revenue   190.3    233.4    255.6    321.9    332.6    398.1    632.3    596.3    612.1 
Personnel   73.0    91.3    96.4    118.0    120.2    137.7    271.5    237.6    253.4 
Third parties   19.8    28.8    27.7    46.8    49.5    45.1    69.0    88.8    92.2 
Maintenance   8.6    4.5    6.2    6.6    8.1    15.5    27.8    19.8    24.7 
Travel   2.4    3.8    4.3    4.6    4.6    6.7    17.2    17.2    19.2 
Freight   0.6    0.8    0.9    1.1    1.2    1.3    13.4    1.5    0.8 
Rentals   7.3    7.2    7.1    9.6    9.5    3.3    8.6    10.7    11.7 
Fuel   5.4    6.6    9.0    12.2    18.7    19.8    7.5    12.6    12.8 
Materials   2.3    3.2    3.5    3.3    3.5    10.4    5.2    7.9    5.2 
Telecommunications   0.4    0.5    0.7    0.7    0.6    1.0    4.2    3.7    2.9 
Marketing   0.9    0.3    1.5    0.5    0.7    5.5    4.1    3.1    5.3 
Taxes   2.1    3.6    3.7    9.3    6.2    5.9    -1.3    10.8    4.2 
Others   9.2    9.0    14.4    16.3    20.8    30.5    27.0    38.4    21.9 
Total   132.1    159.4    175.3    229.0    243.6    282.8    454.2    452.1    454.1 

 

 

 

 

Percentage of Net Revenue

 

RESPONSE
COST OF SERVICES R$ million  2Q21   3Q21   4Q21   1Q22   2Q22   3Q22   4Q22   1Q23   2Q23 
Net Revenue   190.3    233.4    255.6    321.9    332.6    398.1    632.3    596.3    612.1 
Personnel   38.3%    39.1%    37.7%    36.7%    36.1%    34.6%    42.9%    39.9%    41.4% 
Third parties   10.4%    12.4%    10.9%    14.5%    14.9%    11.3%    10.9%    14.9%    15.1% 
Maintenance   4.5%    1.9%    2.4%    2.1%    2.4%    3.9%    4.4%    3.3%    4.0% 
Travel   1.3%    1.6%    1.7%    1.4%    1.4%    1.7%    2.7%    2.9%    3.1% 
Freight   0.3%    0.3%    0.3%    0.4%    0.3%    0.3%    2.1%    0.2%    0.1% 
Rentals   3.9%    3.1%    2.8%    3.0%    2.9%    0.8%    1.4%    1.8%    1.9% 
Fuel   2.8%    2.8%    3.5%    3.8%    5.6%    5.0%    1.2%    2.1%    2.1% 
Materials   1.2%    1.3%    1.4%    1.0%    1.1%    2.6%    0.8%    1.3%    0.8% 
Telecommunications   0.2%    0.2%    0.3%    0.2%    0.2%    0.3%    0.7%    0.6%    0.5% 
Marketing   0.5%    0.1%    0.6%    0.2%    0.2%    1.4%    0.6%    0.5%    0.9% 
Taxes   1.1%    1.5%    1.4%    2.9%    1.9%    1.5%    -0.2%    1.8%    0.7% 
Others   4.8%    3.9%    5.6%    5.1%    6.2%    7.7%    4.3%    6.4%    3.6% 
Total   69.4%    68.3%    68.6%    71.1%    73.2%    71.0%    71.8%    75.8%    74.2% 
Gross Margin   30.6%    31.7%    31.4%    28.9%    26.8%    29.0%    28.2%    24.2%    25.8% 

 

Costs remained stable as a percentage of revenue when comparing 2Q23 vs. 1Q23, reflecting the company's business mix. There were no highlights in the composition of costs in this quarter. The largest cost components – Personnel, Third Parties, Maintenance, Fuel and Travel – represented more than 85% of total costs.

 

GROSS PROFIT

  

 

Gross profit grew over 2Q22. Gross margin for 2Q23 reached 25.8%, a result of 1.0 pp. lower than 2Q22 and up by 1.6 pp. compared to 1Q23. The improvement in gross margin in relation to 1Q23, is due to better performance in Brazil and Canada.

 

 

 

 

CAPEX RESPONSE

 

In 2Q23, addition of Fixed Assets was R$41.9 million. In Response, we invested in Latin America in the new training camp in Chile and in the acquisition of equipment to be used in outsourcing contracts.

 

Additions to Fixed Assets
R$ million		  2Q23   2Q22   Chg.
2Q23 x
2Q22		    1Q23   Chg.
2Q23 x
1Q23		    6M23   6M22   Chg.
6M23 x
6M22		  
Response   41.9    26.1   61.0%     69.0   -39.2%     110.9    90.9   22.1%  
(+) Brazil   11.6    8.9   29.4%     43.8   -73.6%     55.4    58.8   -5.7%  
(+) LATAM (ex-Brazil)   19.8    1.9   933.4%     1.1   1662.9%     20.9    2.0   967.3%  
(+) Europe   1.8    0.5   261.6%     1.8   -0.5%     3.7    3.7   0.3%  
(+) North America   8.7    14.7   -40.4%     22.2   -60.6%     30.9    26.4   16.9%  

 

Additions to Fixed Assets
R$ million		  2Q21   3Q21   4Q21   1Q22   2Q22   3Q22   4Q22   1Q23   2Q23 
Response   20.8    46.2    12.9    64.8    26.1    69.9    72.5    69.0    41.9 
(+) Brazil   16.4    32.5    7.1    49.9    8.9    52.3    37.9    43.8    11.6 
(+) LATAM (ex-Brazil)   0.7    2.0    2.1    0.0    1.9    0.7    4.0    1.1    19.8 
(+) Europe   0.1    2.6    2.8    3.2    0.5    2.4    2.1    1.8    1.8 
(+) North America   3.7    9.2    0.9    11.8    14.7    14.4    28.5    22.2    8.7 

 

   1Q23   2Q23 
Expansion and Maintenance Capex  Capex
(R$ Million)		   % Group
Revenue		   Capex
(R$ Million)		   % Group
Revenue		 
Service Expansion   66.0    5.8%    76.3    6.3% 
RESPONSE   38.0    3.3%    24.3    2.0% 
Response Brazil   25.6    2.2%    6.3    0.5% 
Response Latam (Ex. Brazil)   0.6    0.1%    18.0    1.5% 
Response Europe   0.3    0.0%    0.0    0.0% 
Response North America   11.5    1.0%    0.0    0.0% 
Service Maintenance   68.4    6.0%    59.6    4.9% 
RESPONSE   31.1    2.7%    17.7    1.5% 
Response Brazil   18.3    1.6%    5.3    0.4% 
Response Latam (Ex. Brazil)   0.5    0.0%    1.8    0.2% 
Response Europe   1.6    0.1%    1.8    0.2% 
Response North America   10.7    0.9%    8.7    0.7%