Itaúsa (ITSA4) maintains plan to sell XP shares, but without pressure, says president

A Itaúsa (ITSA4) will maintain the strategy for selling its stake in XP, but in 2023 it will not face the same pressure to dispose of part of the shares in view of current market conditions and debt amortizations carried out by the holding company last year.

“The idea is to continue selling XP shares throughout this year,” he said. alfredo setubalchief executive of the holding company controlling Itaú Unibanco and an important shareholder of companies such as Alpargatas, Dexco, Aegea and CCR, in a conference with analysts and investors this Tuesday.

The day before, the company reported recurring net income of 3.36 billion of reais in the fourth quarter of 2022, down 18.7% compared to the same period of the previous year.

“Of course, the moment in the capital market is not super favorable”, said Setubal, adding that Itaúsa will look for the best windows for possible additional sales of actions from the XP this year in parallel with the opportunity to use the resources.

Itaúsa sold 4.7 billion reais in XP shares in 2022, of which around 1.5 billion in November, an operation that left the holding company with a stake of around 6.6% in the total capital.

According to Setubal, since 2021, Itaúsa has sold around 6 billion reais in XP shares “at an average price of 122 reais and today it is around 60 reais”.

“We see a challenging scenario this year and we sold a lot last year. We have no pressure to sell XP right now,” said the executive.

This more difficult scenario compared to 2022, according to Setubal, should also impact the performance of the holding company’s investees. The executive added that the company has no plans for new investments given the uncertainties in Brazil and abroad, aggravated by the war in Ukraine and tensions between the United States and China.

Itaúsa’s shares were up 1.52% at 12:56 am, while the Ibovespa was up 0.21%. The day before, the company announced 637 million reais in interest on net equity, equivalent to about 7 cents per share, with payment scheduled for the end of August based on the shareholding position of March 23.

“The economy is challenging, it is slowing down both in Brazil and abroad… We will continue with prudent management, analyzing the scenario calmly”, said Setubal, highlighting the long-term character of the group’s investments.

Questioned whether the holding company could consider increasing its stake in the companies it already invests in, since it is not seeking investments in new companies, the executive stated that the time for Itaúsa is one of deleveraging.

Setubal stressed, however, that he would like to see an increase in the stake held in the water and sanitation company Aegea, “if it were possible”, although he stressed that it is not a sector that will bring relevant cash flows in the coming years in view of the heavy investments required by the regulatory framework for sanitation.

Itaúsa owns 10.2% of Aegea’s common shares. Another 70.7% is in the hands of the Equipav group and 19% with the sovereign wealth fund of Singapore, GIC.

PAYOUT

Itaúsa announced dividends to shareholders of 4 billion reais for 2022, of which 1.4 billion will be paid this year. Together with share bonuses at a ratio of 1:10, the so-called “payout” to the company’s investors was 31% in 2022, stable over 2021 and above the 26% of 2020.

Setubal said that “it is quite feasible” for Itaúsa to surpass last year’s payout level in 2023, considering a possible additional sale of XP shares. The objective, according to him, is to raise the return to shareholders to a level between 35% and 40%.

The executive also commented that it is “quite possible” that Itaúsa will promote a new bonus to shareholders via the incorporation of reserves this year, in view of the discussion in Congress of a bill that deals with the subject.