BR Advisory Partners Participações (BRBI11) Q2 2024 earnings summary

Executive summary

• Achieved record revenue and net income in 6M24, driven by strong operational performance and client activity, especially in Investment Banking and Capital Markets.

• Client revenues grew 57.1% year-over-year in 6M24, representing 75% of total revenue.

• Investment banking executed over R$14.8 billion in deal volume YTD, with 26 debt issuances totaling R$4.2 billion.

• Wealth under advisory reached R$3.3 billion, up 21% from March, with Wealth Management revenue more than doubling year-on-year.

• Received multiple awards, including Investment Banking Firm of the Year for South America, and highlighted major deals such as the Amil acquisition.

Financial highlights

• Total revenue for 6M24 was R$279.6 million, up 36.6% year-on-year; net income reached R$101.4 million, up 41.2%.

• Net margin for 6M24 was 36.3%; efficiency ratio at 43.9%–44%, slightly higher than last year due to higher commercial expenses.

• Compensation ratio at 27.5%, reflecting increased headcount and team structuring.

• Client revenue per Managing Director increased 26% to R$20.9 million in 6M24.

• Dividend payout ratio at 62.1% for 6M24, with an annualized dividend yield of 8.43%.

Outlook and guidance

• Management targets ROAE above 20% for the foreseeable future, with Q2/2Q24 at 25%, the highest since IPO.

• Strong pipeline in investment banking and capital markets, with continued momentum in primary debt issuance and wealth management inflows.

• Wealth management platform expected to continue growing, with no set targets but positive momentum.

• M&A activity remains elevated, with a favorable environment for strategic transactions and restructuring.

• Capital markets remain active despite Selic at 10.5%, with record R$662 billion in debt issued in the 12 months to June 2024.