PagSeguro Digital Ltd (NYSE: PAGS) stock rose over 5% on 15th May, 2019 (As of 1:12 pm GMT-4; Source: Google finance) as the company in the first quarter of FY 19 has reported the non-GAAP net income of BRL325 million, which is an increase of BRL112 million and up 52% all year-over-year. The non-GAAP net margin reached 26%, which is an increase of 0.6 percentage points year-over-year. The non-GAAP net income also increased 2% quarter-on-quarter and margin increased 0.5 percentage point. The company’s average spending per merchant in Q1 2019 reached BRL5,700, up 70% year-over-year.
Moreover, PAGS has ended the first quarter with 4.4 million active merchants, adding more 1.3 million new merchants in one year, representing an increase of 43% year-over-year. Quarter-over-quarter, PAGS has added 283,000 new merchants. The total payment volume reached BRL24.4 billion in the first quarter, an increase of almost BRL11 billion and up 70% year-over-year and almost flat quarter-on-quarter due to seasonality when compared to Q4, which is the strongest quarter from the payment business in Brazil given the holiday season and the Black Friday. This growth is the result of a greater penetration of the ecosystem in the long-tail combined with the trend of cash to plastic conversion that is still at the beginning of the merchant base with lots of to grow in Brazil and with the upside of selling additional products and services to these clients. The net take rate, which is the blind and take rates net from transaction costs such as interchange, processing and card scheme fees reached 3.12% in Q1 2019 or 12 basis points up when compared to previous quarter.
Additionally, the Net Cash used in operating activities in the three months ended March 31, 2019 has totaled R$199.9 million. The Cash flows used in investing activities in the three months ended March 31, 2019 has totaled R$1,716.6 million. The Cash flows used in financing activities in the three months ended March 31, 2019 has totaled R$13.6 million, principally related to the acquisition of the remaining 49% of R2Tech Informática S.A. in February 2019. Cash and cash equivalents at March 31, 2019 amounted to R$832.9 million.
Meanwhile, during the first quarter 2019, PAGS has launched Cash Card. In March 2019, PAGS had acquired a minority stake in NetPOS Serviços de Informática S.A. (“NetPOS”), which is an ERP software provider, focused on retail and food service in the small and medium businesses (“SMB”) market. In April 2019, the company had launched the Instant Payment feature for debit and credit card transactions (both with and without installments) for all merchants.