DLocal Limited (DLO) In A Tricky Spot Between Opportunity And Execution

DLocal Limited (DLO) is rising on the charts today, up 24.49% to trade at $61.35 at last check-in after-hours trading. On Wednesday, shares in local Limited rose 1.59% to close the day at $49.28. The volume of shares traded was 1.36 million, which is higher than the average volume over the last three months of 1.11 million. During the trading session, the stock oscillated between $46.99 and $53.49. The company had an earnings per share ratio of 77.40. DLO’s stock has lost -2.11% of its value in the previous five sessions and 4.21% over the past month but has gained 52.15% on a year-to-date basis. 

On Aug. 18, 2021, DLocal Limited (NASDAQ:DLO), a technology-first payments platform, unveiled upbeat Q2 financial results.

Q2, 2021 Fiscal Highlights

• Total Payment Volume hit US$1.5 billion in the quarter, reflecting 319% year-over-year growth in contrast to TPV of US$ 348 million years over year and 57% growth compared to TPV of US$926 million in the first quarter of 2021.
• Revenues in the Q2, 2021 totaled US$59.0 million, marking 186% year-over-year growth compared to revenues of US$ 20.6 million in the Q2, 2020 and 46% growth in comparison to revenues of $40.3 million in the previous quarter.
• For Q2, 2021, adjusted EBITDA was $25.9 million, compared to $8.3 million for Q2, 2020, and US$17.8 million for Q1, 2021.
• For Q2, 2021, the adjusted EBITDA margin was 44% compared to 40% for Q2, 2020, and 44% Q1, 2021.
• Net income for the Q2, 2021 was US$17.7 million, or US$0.057 per diluted share, against net income of US$7.4 million, or US$ 0.026 per diluted share, for the Q2, 2020 and with net income of US$16.9 million, or US$0.058 per diluted share, for the Q1, 2021.
• Net income of the Q2, 2021 includes one-off expenses of US$3.0 million related to dLocal’s IPO and US$0.3 million of expenses related to the asset acquisition of PrimeiroPay.

Q2, 2021 Business Highlights

• dLocal’s enterprise merchants performed well in the quarter, particularly those in advertising, retail, and streaming. Also in the second quarter of 2020, ride-hailing and travel industries continued to recover after suffering adverse effects due to COVID-19.
• Existing merchant income in the second quarter of 2021 increased by US$19.7 million. Compared to the fiscal year 2020, the net revenue retention rate, or NRR, increased to 196% in the second quarter of 2021.
• In the second quarter of 2021, sales from New Merchants increased by 18.6 million over the same period last year.
• As part of the company’s expansion effort during the quarter, dLocal added Vietnam, Malaysia, and Guatemala to its geographic network. This brings the total number of countries for which dLocal provides services to 30.
• In the second quarter of 2021, Enterprise Global Merchants used dLocal’s platform to accept 62 payment types across nearly seven countries, up from six countries in 2020 and the quarter before.
• dLocal acquired PrimeiroPay in April 2021 for US$40.0 million for a cash purchase price of US$38.7 million and a contingent purchase price of US$1.3 million. DLocal is now able to reach targeted global merchants as a result of the transaction.