CI&T Reports Solid Third Quarter 2022 Financial and Operational Results

Rhea-AI Summary

CI&T (NYSE: CINT) reported third quarter 2022 results, showing a net revenue of R$559.0 million, up 48.7% year-over-year. The company achieved a net profit of R$40.6 million, reversing a loss from the previous year. Adjusted EBITDA increased to R$107.3 million with a margin of 19.2%. For the nine months ended September 30, 2022, net revenue reached R$1,575.9 million, a 59.6% growth. CI&T forecasts a fourth quarter net revenue of at least R$605 million, anticipating full-year revenue growth of at least 58% at constant currency.

Positive

• Net Revenue increased by 48.7% YoY to R$559.0 million in 3Q22.
• Net Profit rose to R$40.6 million from a loss of R$2.2 million in 3Q21.
• Adjusted Net Profit surged 156.7% to R$69.5 million.
• Client base with annual revenue above R$1 million grew to 147 in 3Q22.
• Forecast for 4Q22 sees net revenue at least R$605 million, representing 41% growth YoY.

Negative

• Adjusted EBITDA margin decreased by 2.1 percentage points to 19.2% compared to 3Q21.
• SG&A expenses increased by 45.3% due to acquisition-related costs.

NEW YORK--(BUSINESS WIRE)-- CI&T (NYSE: CINT, “Company”), a global digital specialist, today announces its results for the third quarter of 2022 (3Q22) and the nine months ended on September 30, 2022 (9M22) in accordance with International Financial Reporting Standards (IFRS). For comparison purposes, we refer to the results for the third quarter of 2021 (3Q21) and for the nine months ended on September 30, 2021 (9M21).

Third Quarter (3Q22) Operating and Financial Highlights

• Net Revenue was R$559.0 million, an increase of 48.7% compared to 3Q21 or a 51.3% growth at constant currency.
• The number of clients with annual revenue above R$1 million in the last twelve months grew from 76 in 3Q21 to 147 in 3Q22.
• Net Profit was R$40.6 million compared to a net loss of R$2.2 million in 3Q21.
• Adjusted EBITDA was R$107.3 million, a 34.1% growth year-over-year, equivalent to an Adjusted EBITDA margin of 19.2%.
• Adjusted Net Profit was R$69.5 million, 156.7% higher than 3Q21. Adjusted net profit margin was 12.4%.
• CI&T ended 3Q22 with 6,887 CI&Ters, a net addition of 1,489 employees (27.6% growth) compared to the end of 3Q21.

Nine months ended September 30, 2022 (9M22) Operating and Financial Highlights

• Net Revenue was R$1,575.9 million, an increase of 59.6% compared to 9M21, or a 65.5% growth at a constant currency.
• Net Profit was R$95.8 million, an increase of 16.7% in relation to 9M21.
• Adjusted EBITDA was R$293.8 million, 32.2% higher than 9M21, with an Adjusted EBITDA margin of 18.6%.
• Adjusted Net Profit was R$162.9 million, an increase of 45.6% compared to 9M21.

Cesar Gon, founder and CEO of CI&T, commented, "As we complete one year of our debut in the capital markets, I am excited to share another set of high growth with sound profitability results. With the cash proceeds of the IPO, we have expanded our operations globally through acquisitions, opening new markets and verticals, and extending our global talent base. With these moves, we amplified our footprint for robust organic growth in our four operating regions: North America, Latin America, Europe, and Asia Pacific."

"A nontrivial macro environment marked these twelve months. Nevertheless, Digital transformation is a secular trend and remains a priority in the corporate world. And CI&T positioning and value proposition focused on speed and digital efficiency resonates extremely well with large and innovative companies."

Comments on the 3Q22 financial performance

In 3Q22, the net revenue was R$559.0 million, an increase of 48.7% compared to 3Q21, or a 51.3% net revenue growth at constant currency. The acquisitions of Somo, Box 1824, and Transpire concluded in 2022 contributed to 14 percentage points of revenue growth in the quarter compared to 3Q21.

We added 20 new clients to our portfolio in 3Q22 (with annual revenue above R$1.0 million in the last twelve months), increasing our client base from 127 in 2Q22 to 147 in 3Q22. We maintained a solid year-over-year growth across all regions and all industry verticals we operate.

The cost of services provided in 3Q22 reached R$363.6 million, an increase of 47.3% compared to 3Q21, and the gross profit was R$195.4 million. Excluding costs with depreciation and amortization and stock-based compensation, the adjusted gross profit in 3Q22 was R$206.5 million, 47.9% higher than in 3Q21. The adjusted gross profit margin was 36.9%, a slight decrease compared to 37.1% in 3Q21, mainly due to lower margins from recently acquired companies.

In 3Q22, selling, general and administrative (SG&A), and other operating expenses were R$130.8 million, an increase of 45.3% compared to 3Q21, mainly due to (i) acquisition-related expenses, including bonus retention, consulting expenses, and amortization of intangible assets from acquired companies; and (ii) the strengthening of our back-office teams in connection with our IPO.

In 3Q22, the Adjusted EBITDA was R$107.4 million, an increase of 34.1% compared to 3Q21. Adjusted EBITDA margin was 19.2% in the quarter, a reduction of 2.1 percentage points compared to 3Q21, mainly due to the increase in SG&A expenses. Sequentially, the Adjusted EBITDA margin improved to 19.2% in 3Q22 from 19.1% in 2Q22 and 17.5% in 1Q22, as a result of gradual price readjustments on our contracts, a seasonal effect.

In 3Q22, net financial expenses were R$7.4 million, a decrease of 66.8% compared to 3Q21, as a result of positive foreign exchange variations in 3Q22, partially compensated by higher interest rates on loans.

In 3Q22, depreciation and amortization expenses totaled R$23.6 million, an increase of 67.3% or R$9.5 million compared to 3Q21, due to the amortization of R$10.3 million from intangible assets from acquired companies.

In 3Q22, income tax expense was R$16.5 million, a reduction of 12.3% compared to 3Q21. In the 9M22, income tax expense was R$49.8 million, a reduction of 13.3% year over year, while the income tax paid (cash effect) was R$33.5 million in the period, equivalent to a cash tax rate of 23%.

In 3Q22, the net profit was R$40.6 million, compared to a net loss of R$2.2 million in 3Q21. Adjusted net profit was R$69.5 million, 156.7% higher than 3Q21, equivalent to an adjusted net profit margin of 12.4%. The increase in the adjusted net profit margin was mainly due to a reduction in financial expenses, income tax expenses, and depreciation of property, plant, and equipment.

Business Outlook

We expect our net revenue in the fourth quarter of 2022 to be at least R$605 million compared to a net revenue of R$457 million in the fourth quarter of 2021, a 41% growth at constant currency or a 32% growth on a reported basis, which includes a negative foreign currency translation impact of approximately nine percentage points.

For the full year of 2022, we are increasing our outlook and expect a net revenue growth at constant currency of at least 58% year-over-year and net revenue growth on a reported basis of at least 51%, which includes a negative foreign currency translation impact of approximately seven percentage points.

In addition, we estimate our adjusted EBITDA margin to be at least 19% for the full year of 2022, assuming an average exchange rate of 5.10 Brazilian Reais to the U.S. dollar for the full year.

These expectations are forward-looking statements and actual results may differ materially. See "Cautionary Statement on Forward-Looking Statements" below.

Conference Call Information

Cesar Gon, Bruno Guicardi, Stanley Rodrigues, and Eduardo Galvão will host a video conference call to discuss the 3Q22 and 9M22 financial and operating results on November 17 at 8:00 a.m. Eastern Time / 10:00 a.m. BRT. The earnings call can be accessed at the Company’s Investor Relations website at https://investors.ciandt.com or at the following link: https://www.youtube.com/watch?v=qeVVSmOaVAg.

About CI&T

CI&T (NYSE:CINT) is a global digital specialist, a partner in digital transformation for 100+ large enterprises and fast growth clients. As digital natives, CI&T brings a 27-year track record of accelerating business impact through complete and scalable digital solutions. With a global presence in nine countries with a nearshore delivery model, CI&T provides strategy, data science, design, and engineering, unlocking top-line growth, improving customer experience, and driving operational efficiency. Recognized by Forrester as a Leader in Modern Application Development Services, CI&T is the Employer of Choice for more than 6,800 professionals.

Basis of accounting and functional currency

CI&T maintains its books and records in Brazilian reais, the presentation currency for its unaudited condensed consolidated interim financial statements, and the functional currency of our operations in Brazil. CI&T prepares its unaudited condensed consolidated interim financial statements in accordance with IFRS, as issued by the IASB, and International Financial Reporting Standard No 34—Interim Financial Reporting (“IAS 34”).

Non-IFRS Financial Measures

We regularly monitor certain financial and operating metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections and make strategic decisions. These non-IFRS financial measures include Adjusted Gross Profit, Adjusted Gross Profit Margin, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Profit, Adjusted Net Profit Margin, Net Revenue at Constant Currency, and Net Revenue Growth at Constant Currency, and should be considered in addition to results prepared in accordance with IFRS, but not as substitutes for IFRS results. In addition, our calculation of these non-IFRS financial measures may differ from those used by other companies, and therefore comparability may be limited. These non-IFRS financial measures are provided as additional information to enhance investors’ overall understanding of our operations’ historical and current financial performance.

CI&T is not providing a quantitative reconciliation of forward-looking Non-IFRS Net Revenue Growth at Constant Currency and Adjusted EBITDA to the most directly comparable IFRS measure because it is unable to reasonably predict the ultimate outcome of certain significant items without unreasonable efforts. These items include, but are not limited to, stock-based compensation expenses, acquisition-related expenses, the tax effect of non-IFRS adjustments, and other items. These items are uncertain, depend on various factors, and could have a material impact on IFRS reported results for the guidance period.

We calculate Net Revenue at Constant Currency and Net Revenue Growth at Constant Currency by translating Net revenue from entities reporting in foreign currencies into Brazilian reais using the comparable foreign currency exchange average rates from the prior period to show changes in our revenue without giving effect to period-to-period currency fluctuations. Reported Net Revenue in 2021 considers the FX rate at the end of each month, while Net Revenue at Constant Currency considers the average FX rate for the period.

In calculating Adjusted Gross Profit, we exclude cost components unrelated to the direct management of our services. For the periods herein, the adjustments applied were: (i) depreciation and amortization related to costs of services provided; and (ii) stock-based compensation expenses.

In calculating Adjusted EBITDA, we exclude components unrelated to the direct management of our services. For the periods herein, the adjustments were: (i) stock-based compensation expenses; (ii) consulting expenses related to the initial public offering and corporate reorganization; (iii) government grants related to tax reimbursement in the Chinese subsidiary; (iv) non-cash expenses related to the write-off due to inventory of property, plant, and equipment, tax write-off, and the impairment related to the discontinuation of certain investments made by Dextra on intangible assets related to digital platforms; and (v) acquisition-related expenses, including fair value adjustment on accounts payable for business combination, consulting expenses and retention bonuses.

In calculating Adjusted Net Profit, we exclude cost components unrelated to the direct management of our services. For the periods herein, the adjustments applied were: (i) consulting expenses related to the initial public offering and corporate reorganization, (ii) non-cash expenses related to the write-off due to the inventory of property, plant, and equipment, tax write-off, and the impairment related to the discontinuation of certain investments made by Dextra on intangible assets related to digital platforms; and (iii) acquisition-related expenses, including amortization of intangible assets from acquired companies, fair value adjustment on account payables for business combination, consulting expenses and retention bonuses.

Cautionary Statement on Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, which include but are not limited to: the statements under "Business outlook," including expectations relating to revenues and other financial or business metrics; statements regarding relationships with clients; and any other statements of expectation or belief. The words “believe,” “will,” “may,” “may have,” “would,” “estimate,” “continues,” “anticipates,” “intends,” “plans,” “expects,” “budget,” "scheduled,” “forecasts” and similar words are intended to identify estimates and forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements represent our management's beliefs and assumptions only as of the date of this press release. You should read this press release with the understanding that our actual future results may be materially different from what we expect. These statements are subject to known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance, or achievements to differ materially from results expressed or implied in this press release. Such risk factors include, but are not limited to, those related to: the current and future impact of the COVID-19 pandemic, the ongoing war in Ukraine and economic sanctions imposed by Western economies over Russia on our business and industry; the effects of competition on our business; uncertainty regarding the demand for and market utilization of our services; the ability to maintain or acquire new client relationships; general business and economic conditions; our ability to successfully integrate Dextra, Somo, Box 1824, Transpire and Ntersol; and our ability to successfully execute our growth strategy and strategic plans. Additional information concerning these and other risks and uncertainties are contained in the "Risk Factors" section of CI&T's annual report on Form 20-F. Additional information will be made available in our annual reports on Form 20-F, and other filings and reports that CI&T may file from time to time with the SEC. Except as required by law, CI&T assumes no obligation and does not intend to update these forward-looking statements or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

Unaudited condensed consolidated statement of profit or loss   (In thousands of Brazilian Reais)
	Quarter ended September 30,						Nine months ended September 30,
	2022			2021			2022			2021
Net Revenue	559,018			375,970			1,575,905			987,586
Costs of services provided	(363,617	)		(246,846	)		(1,034,111	)		(640,986	)
Gross Profit	195,401			129,124			541,794			346,600
Selling expenses	(43,337	)		(24,122	)		(118,428	)		(61,902	)
General and administrative expenses	(84,804	)		(38,966	)		(228,115	)		(93,056	)
Research and technological innovation expenses	-			-			-			(4	)
Impairment loss on trade receivables and contract assets	325			(1,662	)		(385	)		(2,030	)
Other income (expenses) net	(3,008	)		(25,309	)		(7,492	)		(23,862	)
Operating profit before financial income and tax	64,577			39,065			187,374			165,746
Finance income	32,750			17,591			155,638			43,421
Finance cost	(40,182	)		(40,007	)		(197,315	)		(69,523	)
Net finance costs	(7,432	)		(22,416	)		(41,677	)		(26,102	)
Profit before Income tax	57,145			16,649			145,697			139,644
Income tax expense
Current	(22,273	)		(28,809	)		(44,796	)		(63,367	)
Deferred	5,736			9,952			(5,071	)		5,852
Net profit for the period	40,608			(2,208	)		95,830			82,129
Earnings per share
Earnings per share – basic (in R$)	0.30			(0.02	)		0.72			0.68
Earnings per share – diluted (in R$)	0.30			(0.02	)		0.72			0.67
Weighted average number of basic shares held by shareholders	133,332,778			119,960,451			133,006,973			119,960,422
Weighted average number of diluted shares held by shareholder	133,332,778			119,960,451			133,006,973			122,895,435

Unaudited condensed consolidated statements of financial position   (In thousands of Brazilian Reais)
Assets	September 30, 2022		December 31, 2021		Liabilities and equity	September 30, 2022			December 31, 2021
Cash and cash equivalents	151,850		135,727		Suppliers and other payables	26,512			33,566
Financial Investments	181,857		798,786		Loans and borrowings	252,629			164,403
Trade receivables	462,793		340,519		Lease liabilities	29,199			21,214
Contract assets	229,165		134,388		Salaries and welfare charges	256,028			234,173
Recoverable taxes	6,667		7,785		Accounts payable for business combination	63,947			48,923
Tax assets	1,089		2,810		Loss adjustments on hedge accounting	50,315			-
Gain adjustments on hedge accounting	13,028		-		Derivatives	6,095			535
Derivatives	11,775		896		Tax liabilities	3,379			13,345
Other assets	33,173		29,994		Other taxes payable	14,173			5,423
Total current assets	1,091,397		1,450,905		Contract liability	11,760			13,722
					Other liabilities	34,133			13,669
Recoverable taxes	3,591		3,046		Total current liabilities	748,170			548,973
Deferred tax assets	34,285		31,989
Judicial deposits	9,468		3,079		Loans and borrowings	453,729			624,306
Restricted cash - Escrow account and indemnity asset	32,877		-		Lease liabilities	50,722			60,674
Other assets	3,925		2,974		Provisions	14,587			633
Property, plant and equipment	60,376		57,721		Accounts payable for business combination	55,279			36,803
Intangible assets and goodwill	1,123,626		738,803		Other liabilities	2,020			1,660
Right-of-use assets	70,366		73,827		Total non-current liabilities	576,337			724,076
Total non-current assets	1,338,514		911,439
					Equity
					Share capital	37			36
					Share premium	946,173			915,947
					Capital reserves	26,045			10,105
					Profit reserves	221,787			125,957
					Other comprehensive income	(88,638	)		37,250
					Total equity	1,105,404			1,089,295
Total assets	2,429,911		2,362,344		Total equity and liabilities	2,429,911			2,362,344

Unaudited condensed consolidated statement of cash flow   (In thousands of Brazilian Reais)
	September 30, 2022			September 30, 2021
Net profit for the period	95,830			82,129
Adjustments for:
Depreciation and amortization	67,154			30,102
Loss on the sale of property, plant and equipment and intangible assets	2,137			338
Interest, monetary variation and exchange rate changes	29,562			25,998
Exchange rate changes and monetary adjustments on accounts payable for business combinations	(7,601	)		-
Exchange variation on escrow account related to Somo acquisition	3,798			-
Interest on lease	6,306			4,409
Unrealized loss (gain) on financial instruments	(5,709	)		3,898
Income tax expenses	49,867			57,515
Impairment losses on trade receivables	203			1,112
Impairment losses on contract assets	182			918
Provision for labor and tax risks	386			346
Impairment of intangible assets	-			21,818
Share-based plan	1,894			694
Income on financial investments	(1,628	)		-
Fair value adjustment - accounts payable for business combination	5,243			-
Price adjustment - accounts payable for business combination	1,997			-
Others	(1,824	)		52
Variation in operating assets and liabilities
Trade receivables	(107,311	)		(87,669	)
Contract assets	(85,091	)		(67,530	)
Recoverable taxes	(2,297	)		(13,260	)
Tax assets	930			(2	)
Judicial deposits	(6,389	)		7
Suppliers and other payables	(34,281	)		4,075
Salaries and welfare charges	7,448			43,788
Tax liabilities	1,568			(3,797	)
Other taxes payable	4,509			1,448
Contract liabilities	(4,893	)		(9,036	)
Payment of share-based indemnity	-			(628	)
Other receivables and payables, net	6,714			(6,538	)
Cash (used in)/ generated from operating activities	28,704			90,187
Income tax paid	(33,467	)		(44,468	)
Interest paid on loans and borrowings	(51,152	)		(2,296	)
Interest paid on lease	(4,796	)		(3,972	)
Net cash used in operating activities	(60,711	)		39,451
Cash flows from investment activities:
Acquisition of property, plant and equipment and intangible assets	(20,163	)		(22,112	)
Acquisition of subsidiary net of cash acquired – Dextra	-			(641,784	)
Acquisition of subsidiary net of cash acquired - Somo	(247,764	)		-
Acquisition of subsidiary net of cash acquired - Box 1824	(19,040	)		-
Acquisition of subsidiary net of cash acquired - Transpire	(54,995	)		-
Escrow deposit (acquisition of Somo)	(23,061	)		-
Hedge accounting realization	20,981			-
Redemption of financial investments	582,367			-
Payment of investment obligations - Dextra	(62,338	)		-
Net cash from / used in investment activities	175,987			(663,896	)
Cash flow from financing activities:
Share-based plan contributions	-			989
Dividends paid	-			(71,039	)
Exercised stock options	10,339			-
Interest on equity, paid	-			(713	)
Payment of lease liabilities	(19,828	)		(12,407	)
Proceeds from loans and borrowings	186,239			740,596
Settlement of derivatives	390			-
Payment of loans and borrowings	(279,940	)		(71,702	)
Net cash from financing activities	(102,800	)		585,724
Net decrease in cash and cash equivalents	12,476			(38,721	)
Cash and cash equivalents as of January 1st	135,727			162,827
Exchange variation effect on cash and cash equivalents	3,647			(2,937	)
Cash reduction due to spin-off effect	-			(7,752	)
Cash and cash equivalents as of September	151,850			113,417

Reconciliation of Non-IFRS financial measures to comparable IFRS financial measures   (Unaudited)   Reconciliation of revenue growth as reported on a IFRS basis to revenue growth on a constant currency basis:
Net Revenue (in BRL thousand)	3Q22	3Q21	Var. 3Q22 x 3Q21	9M22	9M21	Var. 9M22 x 9M21
Net Revenue	559,018	375,970	48.7%	1,575,905	987,586	59.6%
Net Revenue at Constant Currency	568,759	375,812	51.3%	1,634,761	987,953	65.5%

Revenue Breakdown
Net Revenue by industry (in BRL thousand)	3Q22	3Q21	Var. 3Q22 x 3Q21	9M22	9M21	Var. 9M22 x 9M21
Financial Services	161,185	134,984	19.4%	476,250	345,073	38.0%
Food and Beverages	114,835	78,258	46.7%	316,891	250,426	26.5%
Technology, Media and Telecom	77,710	45,515	70.7%	215,153	108,006	99.2%
Pharmaceuticals and Cosmetics	74,847	51,503	45.3%	208,837	139,107	50.1%
Retail and Manufacturing	32,753	20,930	56.5%	99,807	55,140	81.0%
Education and Services	18,855	16,458	14.6%	55,508	40,096	38.4%
Logistic and Transportation	20,229	10,713	88.8%	54,861	20,868	162.9%
Others	58,604	17,609	232.8%	148,598	28,870	414.7%
Total	559,018	375,970	48.7%	1,575,905	987,586	59.6%

Net Revenue by geography (in BRL thousand)	3Q22	3Q21	Var. 3Q22 x 3Q21	9M22	9M21	Var. 9M22 x 9M21
NAE (North America and Europe)	289,758	170,883	69.6%	798,751	487,811	63.7%
North America	232,697	165,015	41.0%	655,941	470,563	39.4%
Europe	57,061	5,868	872.4%	142,810	17,248	728.0%
LATAM (Latin America)	247,200	192,200	28.6%	724,480	465,900	55.5%
APJ (Asia, Pacific and Japan)	22,060	12,887	71.2%	52,674	33,875	55.5%

Reconciliation of various income statement amounts from IFRS to non-IFRS for the three and nine months ended September 30, 2022 and 2021:

Gross Profit (in BRL thousand)	3Q22		3Q21		Var. 3Q22 x 3Q21	9M22		9M21		Var. 9M22 x 9M21
Net Revenue	559,018		375,970		48.7%	1,575,905		987,586		59.6%
Cost of Services	(363,617	)	(246,846	)	47.3%	(1,034,111	)	(640,986	)	61.3%
Gross Profit	195,401		129,124		51.3%	541,794		346,600		56.3%
Adjustments
Depreciation and amortization (cost of services provided)	10,688		10,345		3.3%	30,302		23,121		31.1%
Stock-based compensation	369		116		219.0%	1,190		348		241.7%
Adjusted Gross Profit	206,458		139,584		47.9%	573,285		370,069		54.9%
Adjusted Gross Profit Margin	36.9%		37.1%		-0.2p.p	36.4%		37.5%		-1.1p.p

SG&A and other expenses (in BRL thousand)	3Q22		3Q21		Var. 3Q22 x 3Q21	9M22		9M21		Var. 9M22 x 9M21
Selling	(43,337	)	(24,122	)	79.7%	(118,428	)	(61,902	)	91.3%
General and administrative	(84,804	)	(38,966	)	117.6%	(228,115	)	(93,056	)	145.1%
SG&A expenses	(128,141	)	(63,088	)	103.1%	(346,543	)	(154,958	)	123.6%
Other income (expenses) net (1)	(3,008	)	(25,309	)	-88.1%	(7,492	)	(23,866	)	-68.6%
Impairment loss on trade receivables and contract assets	325		(1,662	)	-	(385	)	(2,030	)	-81.0%
SG&A and other operating expenses	(130,824	)	(90,059	)	45.3%	(354,420	)	(180,854	)	96.0%

(1)

Include research and technological innovation expenses

Adjusted EBITDA (in BRL thousand)	3Q22		3Q21		Var. 3Q22 x 3Q21	9M22		9M21		Var. 9M22 x 9M21
Net profit for the period	40,608		(2,208	)	-	95,830		82,129		16.7%
Adjustments
Net financial cost	7,432		22,416		-66.8%	41,677		26,102		59.7%
Income tax expense	16,537		18,857		-12.3%	49,867		57,515		-13.3%
Depreciation and amortization	23,558		14,083		67.3%	67,154		30,102		123.1%
Stock-based compensation	761		193		294.6%	1,894		693		173.5%
Consulting expenses (1)	-		3,080		-100.0%	-		3,080		-100.0%
Government grants	(204	)	(4	)	n.m	(378	)	(1,418	)	-73.4%
Write-off and Impairment (2)	2,156		21,818		-90.1%	3,703		21,818		-83.0%
Acquisition-related expenses (3)	16,497		1,815		809.0%	34,051		2,277		n.m
Adjusted EBITDA	107,343		80,049		34.1%	293,799		222,297		32.2%
Adjusted EBITDA Margin	19.2%		21.3%		-2.1p.p	18.6%		22.5%		-3.9p.p

(1)		IPO-related expenses, including consulting and corporate reorganization expenses.
(2)		Non-cash expenses related to the write-off due to the inventory of property, plant, and equipment in the amount of (R$1,548) in 9M21, tax write-off of (R$2,156) in 3Q22, and impairment of intangible assets of Dextra, acquired in August 2021 in the amount of (R$21,818) in 3Q21.
(3)		Include fair value adjustment on accounts payable for business combination, consulting expenses and retention bonuses.

Net Profit (in BRL thousand)	3Q22		3Q21		Var. 3Q22 x 3Q21	9M22		9M21		Var. 9M22 x 9M21
Net profit for the period	40,608		(2,208	)	-	95,830		82,129		16.7%
Adjustments
Consulting expenses	-		3,080		-100.0%	-		3,080		-100.0%
Write-off and Impairment (1)	2,156		21,818		-90.1%	3,703		21,818		-83.0%
Acquisition-related expenses (2)	26,743		4,389		509.3%	63,321		4,852		n.m
Adjusted Net Profit (3)	69,507		27,079		156.7%	162,854		111,878		45.6%
Adjusted Net Profit Margin	12.4%		7.2%		5.2p.p	10.3%		11.3%		-1p.p

(1)		Non-cash expenses related to the write-off due to the inventory of property, plant, and equipment in the amount of (R$1,548) in the 9M21, tax write-off of (R$2,156) in the 3Q22 and 9M22, and impairment of intangible assets of Dextra, acquired in August 2021 in the amount of (R$21,818) in the 3Q21 and 9M211.
(2)		Include amortization of intangible assets from acquired companies, fair value adjustment on accounts payable for business combination, consulting expenses and retention bonuses.
(3)		Adjustments' amounts are gross of tax. Tax effects on non-IFRS adjustments totaled (R$1,943) in 3Q22, (R$1,413) in 3Q21, (R$2,605) in 9M22, and (R$1,570) in 9M21.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20221116006011/en/

Investor Relations Contact:

Eduardo Galvão

investors@ciandt.com

Media Relations Contact:

Zella Panossian

ciandt@illumepr.com

Source: CI&T Inc.

FAQ

What were CI&T's net revenue results for 3Q22?

CI&T reported net revenue of R$559.0 million for 3Q22, up 48.7% from the previous year.

How much did CI&T's net profit increase in 3Q22?

CI&T's net profit increased to R$40.6 million in 3Q22, compared to a net loss of R$2.2 million in 3Q21.

What is CI&T's forecast for 4Q22 net revenue?

CI&T expects at least R$605 million in net revenue for 4Q22, which represents a 41% increase year-over-year.

What is the adjusted EBITDA margin for CI&T in 3Q22?

CI&T reported an adjusted EBITDA margin of 19.2% in 3Q22, a decrease from 21.3% in 3Q21.

How many clients did CI&T gain in 3Q22 with revenue over R$1 million?

CI&T added 20 new clients with annual revenue above R$1 million in 3Q22, bringing the total to 147.