Caixa Seguridade Participações (CXSE3) Q3 2024 earnings summary

Executive summary

• Achieved record net income of BRL 1 billion in Q3 2024, up 10% year-over-year and 13% sequentially, with ROE reaching 62.9% and accounting net income at BRL 1.1 billion, an 11.7% increase from Q3 2023.

• Dividend payout of BRL 930 million approved, representing 92.5% of adjusted net income, to be paid in January 2025.

• Entered the Ibovespa index, enhancing market relevance and liquidity.

• Significant reduction in insurance complaints and new sustainability initiatives, including joining the UN Global Compact and Pact for Racial Equity.

• Simplified shareholding structure by merging XS2 into Caixa Vida e Previdência and divesting non-strategic interest in Wiz Co.

Financial highlights

• Operating revenue reached BRL 1.33 billion in Q3 2024, up 10.5% year-over-year, driven by strong performance in mortgage, home, and credit life insurance, as well as accumulation products.

• Written premiums in insurance segment reached BRL 2.51 billion, up 7.8% year-over-year, with mortgage, home, and credit life insurance each growing over 13%.

• Private pension reserves rose to BRL 167.6 billion, up 11.9% year-over-year, with admin fee revenues growing 12.5%.

• Consortium credit letters sold totaled nearly BRL 5 billion, a 22% increase in new proposals year-over-year; credit letters inventory up 57.7% to BRL 28.1 billion.

• Distribution business revenue grew 12.2% year-over-year, with insurance products contributing over 71% of total.

Outlook and guidance

• Expect continued growth in insurance and accumulation products, though percentage growth may moderate as the base increases.

• Measures to expand pension product distribution outside the bank are expected to ease funding pressures and improve outlook for 2025.

• Continued focus on operational simplification, cost reduction, and sustainability, with the 2024/2025 plan and new ESG commitments.