Porto Seguro (PSSA3) Q3 2024 earnings summary

Executive summary

• Net income reached R$739.1 million in 3Q24, up 32.3% year-over-year, with total revenue of R$9.5 billion, an 11% increase, driven by business diversification and strong performance in health, banking, and services verticals.

• All business units posted ROAE above 20%, with consolidated ROAE at 22.9%–23% and individual units ranging from 22% to 29%.

• Insurance contributed 59.3% of net income, bank 22.8%–29.7%, healthcare 5.2%–10.6%, and services 7.2%.

• Recognized as a top employer and most remembered insurance brand in Brazil for the 11th consecutive year.

Financial highlights

• EBITDA for the quarter was R$106 million, with a 17% margin; financial investment portfolio revenue was R$293.6 million, representing 83.2% of CDI.

• Net income for 3Q24 was R$739.1 million (+32.3% vs. 3Q23); 9M24 net income was R$2.0 billion (+25.2% vs. 9M23).

• Operational efficiency ratio was 11.1% in 3Q24, stable year-over-year.

• Porto Bank's credit portfolio grew 9.2%, mainly from credit cards, and delinquency rates improved.

• ROAE as a % of CDI was 151% for 9M24.

Outlook and guidance

• 2024 projections maintained for most verticals; Porto Saúde loss ratio range updated to 75–79% and Porto Bank revenue growth range to 18%–24%.

• Expectation for 2025 is a return to pre-pandemic loss ratio levels in health, with continued seasonality.

• Bank and insurance verticals anticipate continued growth, with ROAE expected to remain above 20%.

• Efficiency and G&A ratios for all segments remain within previously disclosed ranges.