CI&T Inc 6-K, filed Aug 17, 2022

CI&T Inc (CINT)

6-K 2022-08-17 For: 2022-08-17

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Added on April 10, 2026

About this 6-K

CI&T Inc filed this 6-K on August 17, 2022.

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Net Revenue by industry (in BRL thousand)	2Q22	2Q21	Var. 2Q22 x 2Q21	6M22	6M21	Var. 6M22 x 6M21
Financial Services	161,466	111,268	45.1%	315,064	210,089	50.0%
Food and Beverages	107,988	88,112	22.6%	202,056	172,169	17.4%
Technology, Media and Telecom	69,690	30,142	131.2%	137,443	62,491	119.9%
Pharmaceuticals and Cosmetics	70,568	45,798	54.1%	133,990	87,604	52.9%
Retail and Manufacturing	31,624	18,232	73.4%	67,053	34,210	96.0%
Education and Services	16,965	11,446	48.2%	36,653	23,638	55.1%
Logistic and Transportation	17,596	4,923	257.4%	34,632	10,155	241.0%
Others	49,118	5,403	809.2%	89,996	11,260	699.3%
Total	525,015	315,324	66.5%	1,016,887	611,616	66.3%

Net Revenue by geographic (in BRL thousand)	2Q22	2Q21	Var. 2Q22 x 2Q21	6M22	6M21	Var. 6M22 x 6M21
NAE (North America and Europe)	267,464	159,187	68.0%	508,993	312,810	62.7%
North America	219,304	152,574	43.7%	423,244	301,584	40.3%
Europe	48,160	6,613	628.3%	85,749	11,226	663.8%
LATAM (Latin America)	242,574	146,641	65.4%	477,280	277,818	71.8%
APJ (Asia, Pacific and Japan)	14,977	9,496	57.7%	30,614	20,988	45.9%

Gross Profit (in BRL thousand)	2Q22	2Q21	Var. 2Q22 x 2Q21	6M22	6M21	Var. 6M22 x 6M21
Net Revenue	525,015	315,324	66.5%	1,016,887	611,616	66.3%
Cost of Services	(341,502)	(205,768)	66.0%	(670,494)	(394,140)	70.1%
Gross Profit	183,513	109,556	67.5%	346,393	217,476	59.3%
Adjustments
Depreciation and amortization (cost of services provided)	10,295	6,551	57.2%	19,614	12,776	53.5%
Stock-based compensation	(361)	181	-	821	233	253.0%
Adjusted Gross Profit (1)	193,447	116,287	66.4%	366,828	230,484	59.2%
Adjusted Gross Profit Margin (1)	36.8%	36.9%	0p.p	36.1%	37.7%	-1.6p.p

SG&A expenses (in BRL thousand)	2Q22	2Q21	Var. 2Q22 x 2Q21	6M22	6M21	Var. 6M22 x 6M21
Selling	(39,962)	(18,801)	112.6%	(75,091)	(37,780)	98.8%
General and administrative	(78,390)	(28,328)	176.7%	(143,311)	(54,054)	165.1%
SG&A expenses	(118,352)	(47,129)	151.1%	(218,402)	(91,834)	137.8%
Other income (expenses) net (1)	(3,969)	(184)	n.m	(4,484)	1,406	-
Impairment loss on trade receivables and contract assets	356	2,891	-87.7%	(710)	(367)	93.5%
SG&A and other operating expenses	(121,965)	(44,422)	174.6%	(223,596)	(90,795)	146.3%

Adjusted EBITDA (in BRL thousand)	2Q22	2Q21	Var. 2Q22 x 2Q21	6M22	6M21	Var. 6M22 x 6M21
Net profit for the period	25,999	44,722	-41.9%	55,222	84,337	-34.5%
Adjustments
Net financial cost	17,533	1,989	781.5%	34,245	3,686	829.1%
Income tax expense	18,016	18,423	-2.2%	33,330	38,658	-13.8%
Depreciation and amortization	24,205	8,224	194.3%	43,596	16,019	172.2%
Stock-based compensation	(106)	328	-	1,133	501	126.1%
Consulting expenses	6,395	237	n.m	9,090	462	n.m
Government grants	(115)	(9)	n.m	(174)	(1,414)	-87.7%
Write-off (1)	-	-	0.0%	1,548	-	0.0%
Acquisition-related expenses (2)	8,464	-	0.0%	8,464	-	0.0%
Adjusted EBITDA (3)	100,391	73,915	35.8%	186,454	142,249	31.1%
Adjusted EBITDA Margin (3)	19.1%	23.4%	-4.3p.p	18.3%	23.3%	-4.9p.p

Net Profit (in BRL thousand)	2Q22	2Q21	Var. 2Q22 x 2Q21	6M22	6M21	Var. 6M22 x 6M21
Net profit for the period	25,999	44,722	-41.9%	55,222	84,337	-34.5%
Adjustments
Consulting expenses	6,395	237	n.m	9,090	462	n.m
Write-off (1)	-	-	0.0%	1,548	-	0.0%
Acquisition-related expenses (2)	19,859	-	0.0%	27,488	-	0.0%
Adjusted Net Profit (3) (4)	52,253	44,959	16.2%	93,347	84,799	10.1%
Adjusted Net Profit Margin (3)	10.0%	14.3%	-4.3p.p	9.2%	13.9%	-4.7p.p

	⁽¹⁾	Non-cash expenses related to the inventory of property, plant, and equipment of the recently acquired Dextra.
	⁽²⁾	Include amortization of intangible assets from acquired companies, fair value adjustment on accounts payable for business combination and acquisition-related retention bonuses.
	⁽³⁾	Adjusted Net profit and Adjusted net profit margin are Non-IFRS measures. See Non-IFRS financial measures section for more information.
	⁽⁴⁾	Adjustments' amounts are gross of tax. Tax effects on non-IFRS adjustments totaled R$111 thousand negative in 2Q22, R$81 thousand negative in 2Q21, R$661 thousand negative in 6M22, and R$157 thousand negative in 6M21.

	Quarter ended June 30,		Six months ended June 30,
	2022	2021	2022	2021
Net Revenue	525,015	315,324	1,016,887	611,616
Costs of services provided	(341,502)	(205,768)	(670,494)	(394,140)
Gross Profit	183,513	109,556	346,393	217,476
Selling expenses	(39,962)	(18,801)	(75,091)	(37,780)
General and administrative expenses	(78,390)	(28,328)	(143,311)	(54,054)
Research and technological innovation expenses	-	-	-	(4)
Impairment loss on trade receivables and contract assets	356	2,891	(710)	(367)
Other income (expenses) net	(3,969)	(184)	(4,484)	1,410
Operating profit before financial income and tax	61,548	65,134	122,797	126,681
Finance income	53,306	16,379	122,888	25,428
Finance cost	(70,839)	(18,368)	(157,133)	(29,114)
Net finance costs	(17,533)	(1,989)	(34,245)	(3,686)
Profit before Income tax	44,015	63,145	88,552	122,995
Income tax expense	(18,016)	(18,423)	(33,330)	(38,658)
Current	(17,115)	(21,040)	(22,523)	(34,558)
Deferred	(901)	2,617	(10,807)	(4,100)
Net profit for the period	25,999	44,722	55,222	84,337
Earnings per share
Earnings per share – basic (in R$)	0.20	0.37	0.42	0.70
Earnings per share – diluted (in R$)	0.20	0.37	0.42	0.69

Assets	June 30, 2022	December 31, 2021	Liabilities and equity	June 30, 2022	December 31, 2021
Cash and cash equivalents	104,190	135,727	Suppliers and other payables	24,655	33,566
Financial Investments	253,304	798,786	Loans and borrowings	183,465	164,403
Trade receivables	416,728	340,519	Lease liabilities	27,548	21,214
Contract assets	231,695	134,388	Salaries and welfare charges	214,367	234,173
Recoverable taxes	17,196	7,785	Accounts payable for business combination	113,559	48,923
Tax assets	1,016	2,810	Loss adjustments on hedge accounting	49,330	-
Gain adjustments on hedge accounting	9,595	-	Derivatives	7,033	535
Derivatives	7,736	896	Tax liabilities	8,482	13,345
Other assets	36,592	29,994	Other taxes payable	11,610	5,423
Total current assets	1,078,052	1,450,905	Contract liability	11,771	13,722
			Other liabilities	20,942	13,669
Recoverable taxes	3,587	3,046	Total current liabilities	672,762	548,973
Deferred tax assets	22,954	31,989
Judicial deposits	9,337	3,079	Loans and borrowings	489,777	624,306
Restricted cash - Escrow account and indemnity asset	33,975	-	Lease liabilities	55,688	60,674
Other assets	3,950	2,974	Provisions	14,586	633
Property, plant and equipment	60,962	57,721	Accounts payable for business combination	67,627	36,803
Intangible assets and goodwill	1,078,187	738,803	Other liabilities	1,739	1,660
Right-of-use assets	73,998	73,827	Total non-current liabilities	629,417	724,076
Total non-current assets	1,286,950	911,439
			Equity
			Share capital	37	36
			Share premium	929,984	915,947
			Capital reserves	23,796	10,105
			Profit reserves	181,179	125,957
			Other comprehensive income	(72,173)	37,250
			Total equity	1,062,823	1,089,295

Total assets	2,365,002	2,362,344	Total equity and liabilities	2,365,002	2,362,344

	June 30, 2022	June 30, 2021
Net profit for the period	55,222	84,337
Adjustments for:
Depreciation and amortization	43,596	16,019
Loss on the sale of property, plant and equipment and intangible assets	2,025	448
Interest, monetary variation and exchange rate changes	10,164	(1,168)
Exchange rate changes and monetary adjustments on accounts payable for business combinations	(6,420)	-
Exchange variation on escrow account related to Somo acquisition	2,668	-
Interest on lease	4,233	2,617
Unrealized loss (gain) on financial instruments	314	(2,405)
Income tax expenses	33,330	38,658
Impairment losses on trade receivables	101	307
Impairment losses on contract assets	609	60
Provision for labor and tax risks	385	2
Share-based plan	1,133	390
Income on financial investments	(651)	-
Fair value adjustment - accounts payable for business combination	5,123	-
Others	-	(42)
Variation in operating assets and liabilities
Trade receivables	(74,260)	(56,123)
Contract assets	(88,256)	(42,805)
Recoverable taxes	(8,498)	440
Tax assets	(158)	(461)
Judicial deposits	(6,258)	7
Suppliers and other payables	(31,796)	2,349
Salaries and welfare charges	(27,461)	2,427
Tax liabilities	8,958	(14,088)
Other taxes payable	986	1,130
Contract liabilities	(3,058)	(5,807)
Other receivables and payables, net	(9,140)	(2,786)
Cash (used in)/ generated from operating activities	(87,109)	23,506
Income tax paid	(21,074)	(23,321)
Interest paid on loans and borrowings	(38,379)	(1,966)
Interest paid on lease	(3,174)	(2,607)
Net cash used in operating activities	(149,736)	(4,388)
Cash flows from investment activities:
Acquisition of property, plant and equipment and intangible assets	(15,520)	(17,164)
Acquisition of subsidiary net of cash acquired - Box 1824	(19,040)	-
Acquisition of subsidiary net of cash acquired - Somo	(247,764)	-
Escrow deposit (acquisition of Somo)	(23,061)	-
Hedge accounting realization	16,134	-
Redemption of financial investments	514,394	-
Net cash from / used in investment activities	225,143	(17,164)
Cash flow from financing activities:
Share-based plan contributions	-	691
Dividends paid	-	(71,039)
Exercised stock options	8,785	-
Interest on equity, paid	-	(460)
Payment of lease liabilities	(12,576)	(7,854)
Proceeds from loans and borrowings	133,789	88,496
Settlement of derivatives	(656)	-
Payment of loans and borrowings	(244,384)	(68,265)
Net cash from financing activities	(115,042)	(58,431)
Net decrease in cash and cash equivalents	(39,635)	(79,983)
Cash and cash equivalents as of January 1st	135,727	162,827
Exchange variation effect on cash and cash equivalents	8,098	5,713
Cash reduction due to spin-off effect	-	(7,752)
Cash and cash equivalents as of June 2022 and 2021	104,190	80,805


Unaudited condensed consolidated statements of financial position	#
Unaudited condensed consolidated statements of profit or loss	#
Unaudited condensed consolidated statements of other comprehensive income	#
Unaudited condensed consolidated statements of changes in equity	#
Unaudited condensed consolidated statement of cash flows	#
Notes to the unaudited condensed consolidated interim financial statements	#

Assets	Note	June 30, 2022	December 31, 2021	Liabilities and equity	Note	June 30, 2022	December 31, 2021
Cash and cash equivalents	6.1	104,190	135,727	Suppliers and other payables		24,655	33,566
Financial investments	6.2	253,304	798,786	Loans and borrowings	12	183,465	164,403
Trade receivables	7	416,728	340,519	Lease liabilities	11.b	27,548	21,214
Contract assets	19	231,695	134,388	Salaries and welfare charges	13	214,367	234,173
Recoverable taxes		17,196	7,785	Accounts payable for business combination	14	113,559	48,923
Tax assets		1,016	2,810	Loss adjustments on hedge accounting	24.2	49,330	-
Gain adjustments on hedge accounting	24.2	9,595	-	Derivatives	24.3	7,033	535
Derivatives	24.3	7,736	896	Tax liabilities		8,482	13,345
Other assets	8	36,592	29,994	Other taxes payable		11,610	5,423
				Contract liability		11,771	13,722
Total current assets		1,078,052	1,450,905	Other liabilities		20,942	13,669
				Total current liabilities		672,762	548,973
Recoverable taxes		3,587	3,046
Deferred tax assets		22,954	31,989
Judicial deposits	15	9,337	3,079
Restricted cash - Escrow account and indemnity asset	2/14	33,975	-
Other assets	8	3,950	2,974	Loans and borrowings	12	489,777	624,306
Property, plant and equipment	9	60,962	57,721	Lease liabilities	11.b	55,688	60,674
Intangible assets and goodwill	10	1,078,187	738,803	Provisions	15	14,586	633
Right-of-use assets	11.a	73,998	73,827	Accounts payable for business combination	14	67,627	36,803
				Other liabilities		1,739	1,660
Total non-current assets		1,286,950	911,439
				Total non-current liabilities		629,417	724,076
				Equity	18
				Share capital		37	36
				Share premium		929,984	915,947
				Capital reserves		23,796	10,105
				Profit reserves		181,179	125,957
				Other comprehensive income		(72,173)	37,250
				Total equity		1,062,823	1,089,295
Total assets		2,365,002	2,362,344	Total equity and liabilities		2,365,002	2,362,344

	Note	Period ended June 30, 2022	Quarter ended June 30, 2022	Period ended June 30, 2021	Quarter ended June 30, 2021
Net revenue	19	1,016,887	525,015	611,616	315,324
Costs of services provided	20	(670,494)	(341,502)	(394,140)	(205,768)
Gross profit		346,393	183,513	217,476	109,556
Selling expenses	20	(75,091)	(39,962)	(37,780)	(18,801)
General and administrative expenses	20	(143,311)	(78,390)	(54,054)	(28,328)
Research and technological innovation expenses	20	-	-	(4)	-
Impairment loss on trade receivables and contract assets	20	(710)	356	(367)	2,891
Other income (expenses) net	20	(4,484)	(3,969)	1,410	(184)
Operating expenses net		(223,596)	(121,965)	(90,795)	(44,422)
Operating profit before financial income and tax		122,797	61,548	126,681	65,134
Finance income	21	122,888	53,306	25,428	16,379
Finance cost	21	(157,133)	(70,839)	(29,114)	(18,368)
Net finance costs		(34,245)	(17,533)	(3,686)	(1,989)
Profit before income tax		88,552	44,015	122,995	63,145
income tax expense
Current		(22,523)	(17,115)	(34,558)	(21,040)
Deferred		(10,807)	(901)	(4,100)	2,617
Net profit for the period		55,222	25,999	84,337	44,722
Earnings per share
Earnings per share – basic (in R$)	23	0.42	0.20	0.70	0.37
Earnings per share – diluted (in R$)	23	0.42	0.20	0.69	0.37

					Profit reserves
	Notes	Share capital	Share premium	Capital reserve	Legal reserve	Retained earnings reserve	Retained earnings	Other comprehensive income	Total equity
Balances as of December 31, 2021		36	915,947	10,105	-	125,957	-	37,250	1,089,295
Net profit for the period		-	-	-	-	-	55,222	-	55,222
Business combination (Somo)	2.2	-	14,037	-	-	-	-	-	14,037
Business combination (Box)	2.3	-	-	4,124	-	-	-	-	4,124
Exercise of share options	17/18.a	1	-	8,893	-	-	-	-	8,894
Share-based compensation	17.a	-	-	674	-	-	-	-	674
Exchange variation in foreign investments, net of tax effects	18.f	-	-	-	-	-	-	(69,688)	(69,688)
Cash flow hedges - effective portion of changes in fair value	24.2	-	-	-	-	-	-	(39,735)	(39,735)
Balances as of June 30, 2022		37	929,984	23,796	-	125,957	55,222	(72,173)	1,062,823
Balances as of December 31, 2020		68,968	-	6,764	13,793	95,515	-	13,420	198,460
Net profit for the period		-	-	-	-	-	84,337	-	84,337
Spin-off of the CI&T IOT		(9,426)	-	597	-	-	-	-	(8,829)
Merger of Hoshin		-	-	108	-	-	-	-	108
Additional dividends related to 2020 approved at the extraordinary general meeting (EGM) held on April 30, 2021	18.e	-	-	-	-	-	(40,363)	-	(40,363)
Exchange variation in foreign investments, net of tax effects	18.f	-	-	-	-	-	-	8,651	8,651
Share-based compensation	17.d	-	-	1,081	-	-	-	-	1,081
Interest on equity	18.e	-	-	-	-	-	(3,069)	-	(3,069)
Balances as of June 30, 2021		59,542	-	8,550	13,793	95,515	40,905	22,071	240,376

(ii)	The assets and liabilities of CI&T Brazil and its then subsidiaries at their historical cost;
(iii)	The number of ordinary shares issued by CI&T, as a result of the restructuring is reflected retroactively to January 1, 2020, for purposes of calculating earnings per share;
(iv)	CI&T Brazil shares were contributed in CI&T Delaware at its book value as of November 8, 2021;
(v)	As the remaining equity reserves of CI&T Brazil are no longer applicable to CI&T, they were added to the initial capital reserve balance (see note 18.c).

Cash	700,938
Accounts payable for business combination (note 14)	82,635
Accounts payable	45,726
Retained amount ⁽ⁱ⁾	30,000
Other	6,909
Total consideration transferred (Note 2.1.d)	783,573

Assets	Fair value
Current
Cash and cash equivalents	8,216
Trade receivables ^(a)	56,313
Recoverable taxes	1,668
Other assets	2,386
Current assets	68,583
Non-current
Recoverable taxes	3,932
Property, plant and equipment	9,149
Intangible assets ⁽ⁱ⁾	148,523
Right-of-use assets	5,414
Non-current assets	167,018
Total assets	235,601

Liabilities	Fair value
Current
Suppliers	5,627
Lease liabilities	3,105
Salaries and welfare charges	23,436
Tax liabilities	10,569
Contract liabilities	1,933
Other liabilities	26
Current liabilities	44,696
Non-current
Other liabilities	18
Lease liabilities	3,035
Non-current liabilities	3,053
Total liabilities	47,749
Total identifiable net assets acquired (Note 2.1.d)	187,852

(i) According to the purchase price on August 10, 2021:
	Fair value
Network software (note 10)	191
Internally developed software (note 10)	22,613
Customer relationship (note 10)	88,961
Non-compete agreement (note 10)	16,257
Brands (note 10)	20,501
Total intangible assets at fair value (note 10)	148,523

	Note	Goodwill
Consideration transferred	2.1.a	783,573
Fair value of identifiable net assets	2.1c	(187,852	)
Goodwill (note 10)		595,721

Outflow of cash to acquire subsidiary, net of cash acquired	Note	Amount
Cash consideration	2.1.a	700,938
Less: Balances acquired	2.1.c	(8,216	)
Net outflow of cash - investing activities		692,722

Cash	340,777
Escrow account	23,061
Retained amount ⁽ⁱ⁾ (note 14)	7,206
Earn-out ⁽ⁱⁱ⁾ (note 14)	59,868
Other (note 14)	2,465
Class A common shares issued ⁽ⁱⁱⁱ⁾	14,037
Total consideration transferred (note 2.2.d)	447,414

(i)	The amount of R$ 7,206 (£ 1,000) is related to a portion of the remaining balance payable was retained for any materialized contingencies.
(ii)	The Agreement also contemplates an earn-out clause of up to R$ 59,868 (£ 8,307) based on future performance (see note 14). As of June 30, 2022, the earn-out clause was updated to R$ 56,066 (£ 8,798).
(iii)	Issuance of new 225,649 Class A common shares in connection with the transaction, per a total amount of R$ 14,037, issued to electing sellers in accordance with the Agreement.

(i) According to the purchase price on January 27, 2022:
	Fair value
Customer relationship (note 10)	49,539
Brands (note 10)	7,746
Total intangible assets at fair value (note 10)	57,285

●	The fair value estimate for brands was calculated based on the “Relief from Royalty or Savings of Royalties” method, which estimates the asset's value based on hypothetical royalty payments that would be saved by the asset holder compared to what would be paid for licensing the asset owned by third parties, considering its useful life. The useful life for brands is 15 months.
●	The fair value estimate for customer relationship was calculated based on the multi-period excess earnings. Its useful life is 227 months.

Cash	20,768
Retained amount⁽ⁱ⁾ (note 14)	8,871
Share based payment – vested immediately (note 18.c)	4,124
Other (note 14)	974
Total consideration transferred (note 2.3.d)	34,737

CI&T Inc 6-K, filed Aug 17, 2022

About this 6-K

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

(i) According to the preliminary purchase price on May 31, 2022:
	Fair value
Customer relationship (note 10)	6,430
Brands (note 10)	5,530
(-) Deferred tax⁽ⁱ⁾	(4,066	)
Total preliminary intangible assets at fair value (note 10)	7,894

	●	Note – 11.b - lease term: whether the Group is reasonably certain to exercise extension options.
	●	Note – 19 - revenue recognition: whether service revenue is recognized over time or at point in time.

	●	Note 2 – acquisition of subsidiaries: fair value of the consideration transferred, fair value of the assets acquired, and liabilities assumed.
	●	Note 10 - Impairment test of intangible assets and goodwill: assumptions regarding projections of generation of future cashflows.

	●	Level 1: Quoted prices (not adjusted) in active markets for identical assets or liabilities.
	●	Level 2: Inputs, except for quoted prices, included in Level 1, which are observable for the asset or liability, either directly (prices) or indirectly (derived from prices).
	●	Level 3: Inputs for the asset or liability, which are not based on observable market data (unobservable inputs).

	●	Note 2 – business combination - acquisition of subsidiaries;
	●	Note 17 – share-based payment transactions; and
	●	Note 24 – financial instruments.

Balance as of January 1, 2022	798,786
Effect of movements in exchange rates	(15,604	)
Income on financial investments	651
Redemption of financial investments	(514,395	)
Hedge accounting realization	(16,134	)
Balance as of June 30, 2022	253,304

	June 30, 2022		December 31, 2021
Trade receivables - US market	255,484		226,154
Trade receivables - Brazil market	112,931		101,122
Trade receivables - Other markets	48,627		14,302
(-) Expected credit losses	(314	)	(1,059	)
Trade receivables, net	416,728		340,519

	June 30, 2022	December 31, 2021
Not due	358,359	319,450
Overdue:
from 1 to 60 days⁽ⁱ⁾	50,033	20,020
61 to 360 days	8,090	1,564
Over 360 days	560	544
Total	417,042	341,578

Balance as of January 1, 2022	(1,059	)
Provision	(449	)
Reversal	348
Write-off	655
Exchange variation	191
Balance as of June 30, 2022	(314	)
Balance as of January 1, 2021	(692	)
Provision	(4,705	)
Reversal	4,398
Exchange variation	33
Balance as of June 30, 2021	(966	)

	June 30, 2022	December 31, 2021
Prepaid expenses^(a)	35,480	29,743
Rental security deposits	1,970	2,471
Suppliers’ advances	141	162
Other	2,951	592
Total	40,542	32,968
Current	36,592	29,994
Non-current	3,950	2,974
Total	40,542	32,968