DLocal Limited

Good day and thank you for standing by. Welcome to the D-Local third quarter 2022 results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone, and you will then hear an automated message advising your hand is raised. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Soledad Nagar, Head of Investor Relations. Please go ahead.

Thank you very much, Operator. Good morning, everyone, and thank you for joining our Start Quarter 2022 Earnings Call today. If you have not seen our earning release, a copy is posted in the financial section of our investor relation website. On the call today, I'm joined by Sebastian Canovic, our chief executive officer, Jacobo Singer, our president and COO, Diego Cabrera-Canay, our chief financial officer, and Maria Oldham, vice president of corporate development and investor relations. We are providing a slide presentation to accompany our prepared remarks. This event is being broadcast live via webcast, and both the webcast and presentation may be accessed through dlocal website at investor.dlocal.com. The recording will be available shortly after the event is concluded. Before proceeding, let me mention that any forward-looking statements included in the presentation or mentioned in this conference call are based on currently available information and the local current assumptions, expectations, and projections about future events. While the company believes that our assumptions, expectations, and projections are reasonable given currently available information, you are cautioned not to place undue reliance on those forward-looking statements. Actual results may differ materially from those included in the local presentation or discussed in the conference call for a variety of reasons, including those described in the forward-looking statement and risk factor section of the local filing with the Securities and Exchange Commission, which are available on the local investor relation website. Now I will turn the conference over to Seba. Thank you.

Hello everyone, thanks for joining us today. We are very pleased to report another strong quarter with record financial results, combining growth, disciplined investment, laser-focused execution and significant progress towards building the best financial infrastructure in emerging markets. We now operate in 39 markets, enabling our global merchants to reach over 2 billion consumers. All this accessed through our 1D local model, meaning one contract, one single platform, and one API. In Q3, our total process volume reached US dollars $2.7 billion, and we record $112 million in revenue. Despite the high baseline set in 2021, we saw robust growth in TPV and revenue, increasing by 51% and 63% year over year, respectively. TPV grew by 12% quarter over quarter and revenue by 11% quarter over quarter. We continue to retain our clients with a solid NRR of 152% in Q3 2022. Moreover, it is important to highlight that we continue to grow our gross profit and EVDA dollar amount consistently quarter after quarter. Gross profit increased to 54 million, up 56% year over year. Adjusted EVDA was up 58% year over year to 42 million. Both grew 9% quarter over quarter. We continue to operate with the philosophy of delivering disciplined, profitable growth. We maintained our adjusted EVDA margin relatively stable at 37% compared to 38% in the past four quarters. On slide six. Our geographic expansion efforts outside Latin America continue to yield outstanding results. During the quarter, we saw unparalleled growth from Africa and Asia, with revenues increasing by four times year-over-year and 80% quarter-over-quarter, reaching $25 million. This is more than the 21 million revenue we recorded for the 12 months of 2021. We expect to continue to see solid growth as we cross-sell to merchants that originally started their relationships with us in Latin America, going to Africa and Asia and vice versa. This illustrates a powerful network effect of our financial infrastructure and the quality of our solutions. On slide seven. Moving to our LATAM business, revenue in LATAM increased by 39% year-over-year to $87 million, flat quarter-on-quarter due to temporary market limitations in the Argentine cross-border operation. If we exclude Argentina's cross-border business, LATAM revenue increased by a solid 43% year-over-year at 7% quarter-over-quarter. The Argentinian government temporarily changed the conditions to access the foreign exchange market for the imports of certain goods and services, negatively impacting our Argentina cross-border volumes. The situation has improved during the quarter and we have managed to continue processing most of our TPVs. Overall, our business continues to benefit from diversification across geographies, with no single country accounting for more than 20% of our total revenues in Q3 2022. I will now hand it over to Jaco to comment on our international expansion.