Spotlight: Brazil's largest public IT groups

BNamericas takes a look at the financial performance in the third quarter of 2018 of some of the largest public IT and tech groups in Brazil.

B2W DIGITAL

Brazil's largest online retail group B2W Digital, a local rival of MercadoLibre and owner of the brands Submarino, Americanas.com, Shoptime and Sou Barato, reported net revenues of 1.55bn reais (US$412mn) in Q3, compared to 1.53bn reais in the year-ago period.

The company said that its January-September capex totaled 250mn reais, representing 2.5% of total GMV [gross merchandising volume], compared to 245.9mn reais in 3Q17. Specific quarterly capex was not disclosed.

B2W posted a net loss of 105.8mn reais, up from a loss of 88mn reais in 3Q17, mainly due to an increase in income tax and social contribution and operating income expenses.

The company claims to have ended September with a marketplace share of 52.2%, up 13.3 percentage points from September 2017.

B2W Digital's consolidated total assets amounted to 13bn reais in September.

TOTVS

Founded in 1983, software firm Totvs is considered the largest application software group in emerging markets and the sixth largest worldwide.

The leading developer of business solutions in Brazil, Totvs posted net revenues of 590mn reais in Q3, up 4.8% year-over-year and 2.6% over the quarter before. Investment figures were not disclosed.

Adjusted net income soared 83.5%, to nearly 40mn reais.

Totvs leads with a 35% share of the corporate software market in Brazil, according to Brazilian think-tank FGV's annual survey on the use of information technologies.

Totvs' total assets listed totaled 2.49bn reais at the end of September.

POSITIVO TECNOLOGIA

The sales of Brazil's main manufacturer of electronics, Positivo Tecnologia, grew to 490mn reais in Q3, from 437mn the year before.

Investments totaled 6.9mn, mostly related to R&D activities, but no comparison base was provided.

Net income grew to 11.8mn reais, from 4.6mn, due to the pass-through US dollar prices as well as foreign exchange gains in the period, according to the company.

Company's PCs sales totaled 202,500 units in Q3 (+1.2%). That gives a market share of 14.9%, a decrease of 3.3 percentage points compared to the previous quarter, impacted by a low delivery volume in the government segment.

Positivo's PC share is divided as follows: 20.9% from retail, 7.8% from corporate; and 20.2% from government.

Some 66.5% of Positivo's Q3 revenues came from desktop and laptop sales and 25.8% from mobile phones, including smartphones and feature phones. In the local mobile market, Positivo's market share is 4%.

Positivo's total assets at end-September were valued at 1.88bn reais.

LINX

Brazil's leading retail-focused software company Linx's net Q3 revenues grew 20.5% year-on-year to 174mn reais. During the quarter, 9.8mn reais in research and development expenses were capitalized.

"The main innovation investments in this moment are in the Fintech (Linx Pay Hub) and Omnichannel (Linx Digital), reinforced by the OMS (Order Management System) and e-commerce solutions," Linx said.

"Furthermore, Linx has been investing to enter into new markets, reach new types of clients, taking advantage of opportunities generated by cloud, big data and intelligence," said a company report.

Adjusted net income in the quarter was 14.1mn reais, down 29.3% from the year-ago period.

Linx's total assets listed amounted to 1.57bn reais in September. The company reports a market cap of 3.8bn reais.