Morning to all, and welcome to the video conference for results for Lojas Quero-Quero for Q2 2022 and First Semester 2022. My name is Flávio Abrantes, Manager of IR, and I will begin the presentation. Here we see our agenda today, and I will give you a general overview. 2022 has a very symbolic value for Lojas Quero-Quero. We will turn 55 years, and it is with great pride that we celebrate all these conquests. We have reached 500 stores in more than 400 cities. We improved our store model, and we did our IPO a few months before the pandemic, which brought enormous challenges to our business. Now I would like to pass the floor to our chairman, Peter, who will begin the presentation. Good morning to all. It's a great pleasure to talk to you again.
We're here to talk about the results of the semester and since the beginning of the year. We know that we are in a difficult year. If we compare this with previous year, so a difficult year. I had said this in the beginning of the year. It's as if we were in a Paris-Dakar Race and this crew. Everyone is making an effort, and we have high inflation and high interest rates. This is the scenario we had it in the first semester, and we can say that we worked with a lot of competency in general. Next chart, please. As I said to you, our business is repetitive because I will talk once again about the five pillars. The gaining market, excellence in credit and collection, do more with less phygital retail and high-performance culture.
In terms of winning market, we had a growth of 27% versus 2019 and 29.5% versus first. When we look at the growth, when we look at the total growth, we get to 65% growth versus 2019, which is the best basis for comparison. When we look at our growth quarter after quarter, we're growing 18% and we continue with 18%, which is very reasonable in the times we're living in. We inaugurated 14 new stores. We have 28 new stores opened in the first semester. We closed the semester with 493 stores, and today we have 497. Our focus continues in gaining market, winning market, investing in these five pillars. Excellence in credit and collection.
We have past due over 90 days, 12%, reminding you that in our business we have a good recovery even after 90 days, and thus we have a loss of 2% after six months. We believe this year will be very similar to 2019 as we said in the beginning of the year. Our portfolio continues to grow. We have more sales through our credit card, VerdeCard. We worked hard to get to this. We can say that after the pandemic, people are buying other items outside the store with our card. In terms of expenses, the whole team did an excellent work. We grew 6.4% below inflation in the period. With this, it's very interesting, our focus is always cash. We generated cash, we paid dividends, and we still reduced our net debt by BRL 6 million. This proves...
This helps prove that our case is solid. We grew, we continued to invest, generating cash. This is a good model we have, even in a difficult situation like the one we're living in. We finished the implementation of phygital sales. All the stores are selling through phygital sales. 18% of our sales are through the phygital platform and growing. Growing slowly, and this is our goal. We have a lot to learn. We hope that this project, phygital sales, will continue growing a lot. It's a great opportunity for our clients to buy many things that are not present in the stores in the small cities. High-performance culture. We have 62 new managers graduating. Another team being prepared, 336 employees being prepared in the stores before becoming managers and also two new members of the council.
Nakashima, who came to help us in the council, and also José Zimmermann, who also participates with a very analytical view. Next chart. Concerning expansion, we have 493 stores. At the end of June, we have 497 stores, 14 new stores. 400 cities, as Flávio said. We transformed five stores. Now on August 15, we turn 55 years old, and we will inaugurate our store number 500, and it's a store in the south of Mato Grosso do Sul. The city is called Nova Andradina, and we're going there for this inauguration. Our focus continues to be the states of Santa Catarina and Paraná. In the next months, we have a lot to do in the state of Santa Catarina and Paraná. We have also opportunities in Mato Grosso and São Paulo. Next chart.
Here, our phygital infinite store. It's very good. Please look at our infinite store on our site. In June, 18.9% sales coming from the infinite store, phygital sales. Now we began August with 19.7%. This shows that we will grow this platform. 100% implemented, BRL 27 million in investments, 85,000 SKUs. This is the. We are working on this. Next chart. Here, talking about ESG, which is a topic, a hot topic nowadays. We are a company that is focused on our fundamental values, our fundamental truths. We want to always say the truth. Do to others what you would like them to do to you. Integrity, simplicity, respect, trust, teamwork, transparency, focus on people, continuous learning. This is not only words. We really see this in our stores.
We live this in our distribution centers. This is inside us. It's difficult to find a company that really puts this into practice. We're very proud of this. When we analyze a project like this one, ESG, we discover that we never focused really on ESG, but now we didn't do anything new. These results have shown us that we have a good ESG program in the company. We're among the top three in ESG and small caps in Latin America. Also, we were considered among the top three, and our CFO was considered one of the top three as CFO of small caps in Latin America. We're very proud of this. The same thing that happened with ESG happened with Great Place to Work. We focused on this.
When we prepared a report, we saw the details and also Top Employers. We are looking at what we can learn, and we were ranked as among the top companies. The company is doing very well in this area. We live these values, these truths every day, and we are building the company of our dreams. You know that I love my team. I'm very proud to work with my team. We have a difficult year ahead of us. We're living in a difficult year. We're building the company. We're investing in the company. We're building the company of our dreams, and at the same time, we're generating cash and reducing our debts. Having said this, I'd like to pass the floor to one of the top three CFOs in small-cap companies in Brazil.
Thank you, Peter. Good morning. Well, after Peter's introduction about the results, I will go into more detail. My name is Jean Pablo de Mello, and I will show what we did in terms of results in this quarter and semester. Going on to the next slide, which is the first talking about revenue, it's important to have in mind the context. Peter said that we're in difficult times, but we believe that it's difficult in Brazil. There is a component that we cannot forget, which is the comparison basis. We had a strong growth between 2021 and after the second semester of 2021. We prepared ourselves for this year. We knew we would have a strong basis of comparison and difficult macro.
In this context, we're beginning the second semester, first talking about retail, our main activity, financial services, credits, with a small drop versus the second semester of 2021. We're delivering -3%, a drop of 3% in revenue in retail. In the second quarter of last year, we had grown 45%. When we look at pre-pandemic years, we have a growth of 65% versus 2019. This also has an effect on year-to-date, the first semester of 2022, with this strong basis. We still grow 2% in retail, the same 65% growth versus first semester of 2019. In the second quarter, we delivered same-store sales -10.8% versus 2021. It's important to give you more detail about the seasonal differences we had.
During the first semester of this year, in the first quarter in retail, we had a total growth of 7% in retail revenue for a same-store sales of -1.5%. This represented a CAGR, a compound annual of 18% versus 2019. In the second semester, as I said, it's a drop in the total revenue of 3%, same-store sales 10 point. When we look at 2019, it's the same. The same 18% growth versus 2019. Although there is a drop versus the first quarter, when we look at the pre-pandemic years and when we look at this, we're well aligned with what we did in Q1, although with a more difficult basis. My second point, financial services. In financial services, it's important to remind you, during the pandemic, our clients wanted less financial services.
They even paid cash. In financial services, when the economy became more difficult last year, we saw a greater demand for financial services, although the penetration is low in relation. We had a growth of 18% and year-to-date, 24% versus last year, first semester. Credit card, also growth of 8% in the quarter and semester. Financial services, credit cards supplements our business. Although retail is having difficult times, credit cards and financial services are partially compensating. This is based on the quality of our portfolio. We close the first quarter here with 1%, second semester, 1%, first semester, growth of 6% in revenue in these services. Going on to the next line, I'd like to talk about gross profit, which is our focus due to, and this brings the performance in our stores.
Second quarter, we have a drop -5%, so this has an effect on revenue margin too, and the same gross profit in relation to last year, a growth of 58% versus 2019. This, we had growth in the last few years with opening new stores. In gross margin, it's important to say that the scenario that we lived in the last few years also allowed us to have, during 2021, 2022, margins that were above historical levels. After the second semester, we see a normalization, so lower margins. We delivered 29.9% margin. It's important to remind you that the margin comparable on gross, on gross revenue. We had also accounting changes in the first semester. 29.9% were below the three previous semesters, where we had 31%.
If you look at retail in retail, we had a margin of 22.8%, aligned with the second semester of last year, 23.4%. Although macro, we see that we have more competition now, and we have focused not only on growing but also profitability. The most important thing is to focus on the margin for financial services. It's important to remember that even last year, first, we had a normalization of delinquency. This decreased the margin, but we had an increase in the cost of loans. This has a great impact because interest rates went up in the country. What we did since the second semester of last year, we increased our rates and fees for part of this increase. Since we sell in 12 installments, at the end of the second semester, we begin to have a more normalized margin.
In the second quarter, even with seasonal delinquency that is a little higher, we can already deliver a better margin in Q2 in comparison 50.7% in comparison to 49% in the first. This is the effect as we had mentioned, we expected this for the year. This truly has an impact on the company's margins. Now, looking at revenue margin, and we will see EBITDA on the next slide. Before talking about EBITDA, it's important to say, as Peter mentioned on slide 12, one of our pillars to do more with less. We are preparing ourselves for a difficult year. We made many internal efforts, improving processes, reviewing services. This allowed us in the second quarter to deliver a lower growth in expenses in relation to the previous quarters. The growth was below the IPCA index, with impacts that are not totally comparable.
We made investments in phygital last year, especially in the second semester, and also we opened two new distribution centers. Even with this, even having this impact in comparison with last year, and as you saw, a retail performance a little lower than 2021, but aligned with 2019, we delivered an EBITDA that is higher than in the first quarter, 2017. You can see in the numbers and the profit, a net profit, net accounting profit of less 4%, - 4%. This the effect of the initiatives we have carried out, and even in times of difficulty, we can sequentially deliver a better result in second quarter in relation to the first quarter. Reminding you that it's a growth of 40% in EBITDA versus 2019.
Going on to the next slide, since I mentioned revenue margin and EBITDA, it's important to also talk about delinquency in our portfolio. We had, during the pandemic, a low delinquency, historically low delinquency. You can see Q3 until the second quarter of 2021, and we already expected an increase in delinquency in the next quarters, but aligned with the data of 2019. This is what we saw. First quarter, a delinquency that is very similar to 2019 in Q2 2022, also aligned with the second quarter of 2019. This is very important. Even in times of growth of the credit card, our penetration in terms of credit is still below the period before the pandemic, and we're being very careful. We have a conservative vision when we give credit, but the portfolio continues to grow in a healthy way.
This is important for us. This is our objective. We want to have delinquency aligned with what we had in 2019, and we have been able to deliver this. Going on to the next slide, I will go into showing where the portfolio is growing. This is due to the usage of our VerdeCard credit card. In Q2, we had a growth of 12% in TPV, in transactions, BRL 532 million. We closed the first quarter with a growth of 14%, 39% versus 2019, BRL 1 billion in the first semester. Reminding you that 55% of the usage of the card is in affiliates and 45% inside our stores.
This gradual increase of the penetration of the credit card, which is still below the pre-pandemic levels, but is growing, gives us a growth, a healthy growth in the portfolio. Now, going on to the next slide, not less important, our cash management. As Peter said, doing more with less focusing on high performance. We made investments during last year, investments in working capital, in phygital, in the new distribution centers, which consumed cash last year. As we said, during last year, we had a recovery. We hope to have a normalization as we normalize our working capital. In Q2, even with better results, but similar to the first quarter, we have a drop in net debt from BRL 267 million to BRL 231 million. This is very important.
Even having paid JCP. We grew, we continued to invest, and we reduced our debt. This is the effect of our operational model and the way we see our strategy to grow in a sustainable way. Also, we'd like to comment that in Q3, In July, we took out a loan of BRL 300 million for FIDC. Last year, we had done in June, BRL 300 million. This year was in July. This is due to the vision we have for the growth of the portfolio and the investments we have made in the number of stores expanding. We took out this loan to continue growing the company in a healthy way. With the reduction of this debt, going on to the next slide, CapEx, you can see that we continue investing in the company.
We invested BRL 20 million in Q2, total of BRL 38 million in the first semester. It is a little higher than the first semester of last year, reminding you that last year we had investments in VerdeCard, two new distribution centers. This year we continue investing, renewing stores, expanding stores, and in Q2, we invested more than BRL 4 million in improving the data center. We continue investing, but with a controlled debt, with a good cash generation, and this is our long-term plan. With this, we'd like to close the presentation, and I'd like to pass the floor to Flávio, and we'd like to begin the Q&A session.
Thank you, Jean. We'd like to begin the Q&A session. The first question is from Bob Ford from Bank of America and will be answered by Peter. The question is: It seems that you made improvements in the period.
How is the current environment affecting investment expansion or more improvements in cost? Peter?
Bob, thank you for the question. It's a great pleasure to have you with us. I always say to you, to all of you, we don't like expenses, so we made a strong effort last year, and this year too, to reduce expenses, especially third-party expenses. We want to continue investing in our structure, our workforce. We continue doing this, but reducing whatever we can in terms of other expenses. Now, concerning continuous investments, our model, as you know, we are being able to grow generating cash. We will continue investing.
What I see this year, Bob, like when we were doing very, very well, and I said, "Well, these are good times, but it won't be this way always." Now we have difficult times, but this will also not be forever. We are building the basis of the company in a responsible way. We're continuing to open stores because we see the performance of the stores now is not as well as they were, but they are within the expectations. We're opening new stores. We will continue opening new stores. We have a logistics platform that is greater than what we need. We didn't expect to have the lower volume we're having today. We have this basis well built, and so we won't need more investments in the future, at least in the next 12-18 months.
I believe we have to continue to build the company of our dreams with a larger basis, so when the economy improves. When I say the economy improves, when the interest rates go down and when inflation goes down. We've been through times of high interest rates, but we had never been in a time with high interest rates and high inflation. Both affect us. High interest rates in the cost of capital, and inflation affects our consumers of classes C and D. They have a lower purchasing power. This also is not forever. Things will get better. It's important to focus to have the best possible results, generating cash and also making our investments and reducing our net debt, investing in a responsible way. I'd like to highlight, you saw the Q1, Q2 with. We have a strong bases of comparison in 2019.
In the second semester, this base is lower. If we continue in this gear that we have today versus 2019, we will have positive same-store sales. This is our focus. We want to go through these difficult times with the best possible results, but especially generating cash with our efforts. I don't know if I answered your questions, Bob.
Thank you, Peter. The next questions are from Gabriela Morais, Itaú BBA. They will be answered by Jean. The first question is: We saw an increase in NPLs in the quarter in relation to Q1 2022. Although they are in control on controlled levels and aligned with pre-pandemic numbers, do you intend to be more conservative in giving credit due to the crisis? Should we expect a deceleration, a drop in the portfolio? Have you seen deceleration of the NPLs?
Good morning, Gabriela.
This is a very important point for this year, not only for us, but retail in general. This has a connection with delinquency. The most important thing, our vision was to have delinquency aligned with 2019. There is an increase from Q1 to Q2, a delay over 90 days, past due over 90 days. It's a seasonal effect. Even in 2019 we had this. Now, how did we prepare ourselves for this, and how do we see this year? We expected a difficult year, so during the last quarters, we made improvements. Improvements that involve credit concession in our modeling, and also in collections. Today we believe that we're better than we were in 2019. Yes, we prepared ourselves for difficult times. In giving credit, I don't believe we're going to have to put more restrictions.
We have already done this to begin the year, this first semester, to be with characteristics that will take us to results and delinquencies similar to 2019. We don't see the need for additional changes, small changes. We're working on a day-to-day basis, making adjustments. We do a follow-up if we have to tighten credit or loosen credit or reinforce collections. The normal things. We don't see anything we have to do very different in the second semester in comparison with the first semester. This is the way we're thinking for credit and collections. We don't see differences, NPL, anything different from previous years. Although 2022 is more difficult than 2019, we're a little better operationally, and that's why we can deliver a delinquency that is similar, aligned to the pre-pandemic delinquency.
The issue of growth of the credit card portfolio, it depends a lot on retail. You can see that our penetration in retail sales is lower than in 2019, but it is gradually going up. Even with retail sales growing little, our credit card grows a little more. This is a recovery in terms of penetration. We have penetration levels below 2019. This helps us to continue to grow the portfolio. The level of growth, whether it's gonna grow a little more, a little less, will depend on the environment in the second semester in retail sales, the main variable for growth of the portfolio.
We believe it should follow this trend that we have now, a growth trend, continuous growth trend, because penetration is growing little by little, and there is more space to grow before reaching the levels of 2019, and we believe we will not reach the levels of 2019 this year.
Thank you, Jean. The next question is from Guilherme Domingues from Eleven and will be answered by Peter. The question is: We'd like to explore more about the expansion plan, more details about the expansion plans. With the drop in the macroeconomic conditions and high inflation, how is the company looking at expansion plans from now on? Can you review the expansion plan for the rest of the year or decrease expansion, especially in the southeast or even in the small cities of the south, preserving profitability? Peter?
Guilherme, thank you for the question.
Just mentioning that the stock market has already said I have to be careful about these points. Well, this year we're carrying out the expansion plan. We continue believing that we should continue expanding, investing in building the company of our dreams in a solid way with a good expansion. Crisis, there are many opportunities for growth. I'm talking about opening new stores, revamping of stores and making stores larger and investing in phygital. We have to try to gain share in the next few years. For the time being, we don't see any reason to stop expansion or stop building this company the way we have built this company. Once again, in a responsible way, we're doing this with our cash, generating cash and investing in the company. We're not increasing our debt to grow.
We're continuing to invest with the cash we generate, and we should continue in the same pace as we did in previous years. I can't tell you how many stores we will open, but I don't see changes in our vision as a company to open stores. The focus in the next eight months is in the states of Paraná, Santa Catarina, and some stores in the west of São Paulo and south of Mato Grosso do Sul. The scenario is difficult, is adverse, but we believe that our model is very resilient.
Thank you, Peter. The next questions come from João Andrade, Bradesco BBI, and they will be answered by Jean. In financial services, can we expect a normalization of the gross margin with the turn of portfolio and increase in interest rates? In retail, can we expect a normalization of margin versus 2019?
Finally, the last one, please comment on the sales performance in June.
Good morning, João. Well, concerning margins, financial services in retail and then performance in retail. Financial services, you can see that we had a turn and a sequential improvement in the margin versus Q1. I would say that cost of capital went up yesterday. It continues to rise, so This is the expectation of the market. This has an impact on the margin. Today, our credit card portfolio, we begin Q3 with the rates that we increased as of last year. What should we see? We're seeing is an important seasonality, especially in delinquency. You can see that many times the margin in the second semester is better than the first semester.
Today I would say that the portfolio is normalized, but the margin should fluctuate according to the trend due to normal seasonality. It should continue. Delinquency also has seasonal fluctuations, so it has an impact on margin. In quarters where delinquency is lower, this helps the margin for financial services, and we hope to see this from now on. Concerning the retail margin, the environment in comparison with 2019 is more difficult. I would say that the retail margin today in the short term should continue similar to what we have now, even with pressure in macro, due to the environment that is more difficult, more competition and more promotions in the market as a whole. Our objective is to have prices aligned with the market, and we have inflation. We see products linked to commodities with lower prices, deflation.
In the long term, margins may have some difficulty to grow with this macro environment, but in the short term it should be similar to what we had in Q2. We will follow this and we want to be aligned with market prices. This is important in the short term because the income of our consumer is under pressure. Our consumer has less income. Also retail sales in June. What I can comment about June in comparison with 2019, the same way that Q2 was similar in terms of performance with the first quarter of 2019, yes, also growth came with a very similar performance this year. Of course, there is seasonality in relation to 2021. What I can say is that versus 2019, the performance of June was very similar to what we saw in Q2 this year.
Thank you, Jean. The next question is from Alexandre Godoy.
Please comment on the performance of the stores in the new geographies in São Paulo, retail and credit. Do you see any difference in the mid maturity curve? Peter will answer.
Alexandre, thank you for the question. This is a question that many people have asked. We have a small basis, few stores in this region. We have to think what happened when we had this number of stores in Santa Catarina and Paraná. They never have the performance as the new ones that we have in the south because they're beginning. People don't know our company yet in this region in São Paulo. It's the same situation that we had in Santa Catarina and Paraná. Mato Grosso do Sul is doing a little better in this state. São Paulo is a little more difficulty.
Some stores are doing very well and others are not doing so well, but nothing different from what we saw in the south in the beginning in the other states. As we grow the number of stores, we will begin advertising on television. When you have 10 stores, it's very expensive when you have 10 stores, if you have only five, 10 stores. It's more difficult in the beginning. Once we have a higher number of stores, then things become normal. In the first six to eight months, in the first year, we have greater pressure on freight because it's further away until we have a number of stores that will allow us to have a distribution center. It's what we expected. On average, it's what we expected.
Once again, in the next eight months, the focus is Paraná and Santa Catarina, stores in these two states.
Thank you, Peter. We'd like to close the Q&A session. Thank you very much for the questions. Now I'd like to pass the floor to Jean and then to Peter to thank you all for your presence.
Our IR team is available to clarify any other doubts, questions. I'd like to pass to Peter. I'd like to thank all our employees. We're turning 55 years old. Thank you.
Well, once again, thank you for participating, for the interest in our company. This month, as Jean said, we're celebrating 55 years. Store number 500 will be inaugurated in Mato Grosso do Sul. We're very happy, very thankful for being in these cities and taking our company there.
Also, I'd like to make clear that we are going through difficult times. We all know this. We have inflation, high inflation, high interest rates putting pressure on the cost of capital, putting pressure on our clients. Going through this desert, I believe I'm very well. I have a great team. We have a great team, a fantastic team, very fantastic team, people who really take seriously and live the values of the companies and with a competency that is fantastic. All those who get to know our team are impressed with the quality of the team, of the talent. With people like this makes me very happy. We will continue to focus on growth with our five pillars, going after results, cash generation, and building the company of our dreams. This is what I had to say.
Thank you very much for the support you have given to us. Thank you.
We'd like to conclude our conference call. Thank you.