Earnings Call: Q3 2020

Oct 22, 2020

Discussion contains forward looking statements. These statements are based on the environment as we currently see it and as such there may be certain risks and uncertainties associated with such statements. Please refer to our press release for more information on these specific risk factors that could cause our actual results to differ materially. The company disclaims any intention or obligation to update or revise any forward looking statements whether as a result of new information, further events or otherwise. Please allow me to remind you that the company issued its earnings press release yesterday after market close. It can be found in the Investors section of its website. Also, the presentation for the call and the webcast link are in the Investors section. Today's call will be hosted by Mr. Carlos Rojas Abumrad, Chief Executive Officer and Mr. Mario Romero, Chief Financial Officer. I will now turn the call over to Mr. Carlos Rojas. Good morning, everybody. Thank you for joining us today. As you all know, our societies continue to navigate a complex environment, and we all have had to continue adjusting. However, as I mentioned in our previous call, the situation has reassured us of our purpose. And we're thankful for the opportunity to continue to serve and help our customers and our communities. Throughout these times, we have stayed the course and remained focused on the well-being of our team members and our clients, while creating value for our shareholders through innovation and even greater efficiency and a strict cash flow discipline. As a company with a mission of providing more and better water, we are uniquely positioned to make a difference for our clients while pursuing our transformation program, Flow. We have seized that opportunity, achieving growth throughout our markets and implementing new initiatives that strengthen and streamline our operations, aligning our company with both market trends and the new consumption habits brought about by the pandemic. We remain on track towards our value creation goals while strengthening our commitment to ESG principles and best practices. During the quarter, operational restrictions were less strict than during the Q2. Our plants and working spaces follow health and safety protocols that are very strict and beyond local regulations. Nevertheless, we experienced some restrictions in our Argentinian water improvement manufacturing facility as well as in some distribution centers in Central America. Despite these impediments during the 3rd quarter, we registered double digit growth in both sales and EBITDA. We reached a quarterly sales record and also quarterly EBITDA record. We grew double digits in all of our markets except for Argentina, which remained stable but also achieved to double EBITDA, as Mario will discuss in further detail in a moment. Also in Brazil, after the divestments in the products business in May, we started to operate the first water treatment and recycling plant during the quarter. We achieved group's growth through the strength of our products and services portfolio, which was augmented with the introduction of new products and the optimization of our sales force, both of which were direct results of Flow. In fact, in the 1st 9 months of the year, Flow has contributed 21% of our EBITDA. So, out of every Ps. 10 of adjusted EBITDA come from initiatives that were designed as part of Flow. Flow has generated over 9 50 initiatives, of which more than 45% are already contributing to sales or EBITDA and involve over 25% of our workforce. The allocation of capital expenses to flow initiatives amount to 132,000,000 dollars 64 percent of total CapEx. Also, we have registered $96,000,000 of flow execution expenses, including the implementation of initiatives. Fees based to consulting firm and the human talent restructuring and realignment. It is worth mentioning that with the transformation, Rotoplast has achieved a 9.8% of ROIC, representing the tightest gap between ROIC and weighted average cost of capital for the last 17 quarters. Additionally, it has helped us accomplish greater discipline in cash flow management, optimizing the cash conversion cycle by 23 days. Likewise, Flow has allowed us to respond nimbly and with strict discipline to a challenging environment, creating and executing initiatives that strengthen all aspects of our business. Another good example of the results brought about by Flow is the recent launch of our joint venture with RRG Solutions Mexico. Driago, which will focus technologically disrupted water solutions for the agricultural sector. This is a significant growth opportunity for our company, taking full advantage of the synergies we have with RRG to address the need for sustainable water solutions that will allow producers to increase quality and yields in the context of increasing water scarcity. We are entering a water intensive market and we're doing so while reaffirming our commitment to sustainability and innovation. Flow solution discipline is now ingrained in the Road plus way and is amended by the appointment of our new Chief Transformational Officer who will be in charge of ensuring the continuity and rhythm of our ongoing transformation. Flow has increased our resilience and provides us with a pathway to ensuring that we reach our goal of creating value by generating a greater return on capital than our weighted average cost of capital, to which we are now closer than ever, as Mario will show you in further detail. Furthermore, it has also enabled us to do so in alignment with our commitment to ESG principles and to innovation. I cannot stress enough the importance of these innovations. As you can see in the slide, where we took Mexico as an example, the country has a high level of general water risk and it consumes an exceedingly high percentage of the water available, according to the World Resources Institute. And almost half of the century is classified as having an extremely high risk. As we address the urgent needs of the pandemic, we must also focus on the longer term need for innovative and sustainable water solutions in the hemisphere. Rotopas continues to grow as it has been able to provide these solutions for its customers in order to increase their resiliency against this life threatening matter. Through our transformation program, we will ensure that we will continue to be able to offer our solutions and will remain the leaders of this effort. I will now turn the call to Mario so that he can go into further detail about the key financial results of the quarter. Thank you for your time, and I look forward to your questions. Thank you, Charlie. Good morning to you all. Thank you again for joining us today. As Charlie pointed out, our record quarterly sales show that we've been successful in addressing the needs of our customers and our communities in these complex and uncertain times, while continuing to advance towards our goal of creating value for all of our shareholders. As we mentioned in our previous call, we believe that providing more and better water is not only our reason for being, but it's also a sound business vision. We are, as he said, aware of the need to address the opportunities and challenges created by the pandemic as well as those of the future. We continue to strive to best serve our customers and communities, while generating profitability and adjusting to the changing landscape of the pandemic. We are convinced that we participate in an industry with enormous growth potential that we have a robust products and services portfolio and most importantly that we are going to achieve our value creation goals as Flow is getting better tractions on a daily basis. While we still experienced some operating restrictions in Argentina and Central America. Our operations in Mexico, Peru and the United States were continuous throughout the quarter and by September all operations were continuous. This has entailed our of course a significant effort to ensure that we comply with the strictest safety and hygiene protocols to protect the health of our personnel in our facilities. And while working in the field, it is also worth noting that our administrative staff continues to work remotely. As Charlie said, we remain focused on the well-being of our team members and our clients as well as maintaining a strong cash flow discipline, while continuing to advance in flow. And this focus has brought about strong result for us in the quarter. We reported record sales in the history of Rotaplast, which increased 18%, and the adjusted EBITDA grew 14% year over year. As Troy pointed out, this growth is a result of our ability to address the increased need of water for hygiene and wellness purposes as well as the introduction of new products and the optimization of our sales force. With this growth, we anticipate an increase in market share in all countries and territories, except from the improvement in Argentina due to operating restrictions related to the change to a new manufacturing plant. I would like to point out that we maintain strong brands and our leadership all across the region. It is also worth noting that our government sales as a percentage of total sales amounted to 4.6%, well below our 10% threshold. Moving forward on the P and L, our operating margin decreased by 100 basis points due to greater production cost related to the hiring of additional personnel and the payment of other time to comply with the healthy and safety protocols in response to COVID-nineteen. Our operating income decreased 11% year over year due to the expenses associated with implementation of health and safety measures, which amount to MXN7 1,000,000, MXN4 1,000,000 in donations and the accounting of MXN75 1,000,000 associated to the execution of flow. Without these non recurring expenses, the margin would have increased 15.3% and operating expenses would have grown only 14.1%, which is below the increase in sales. After financing expenses related to the payment of interest on the sustainable bond, foreign exchange losses from the loan position in dollars to cover costs and expenses in debt currency according to the budget and loss from monetary position in Argentina. Our net profit before discontinued operations totaled MXN 41,000,000. We have also maintained our cash flow discipline, optimizing our cash conversion cycle by 23 days. And most importantly, for our value creation goal, our ROIC reached 9.8%, an increase of 50 basis points year over year and a 193 basis point increase since the beginning of flow. We are now, as Charlie mentioned, much closer to our objective of having a return rate than our cost of capital. At this point, I would like to briefly recap Flow main features for those who may not be familiar with it. Flow is a transformational effort aimed at ensuring the company's sustainability growth, its profitability and the creation of value for our shareholders. The immediate objective was defined as achieving a ROIC greater than the cost of capital in 18 months. Working with a leading global consulting company, implementation of flow has enabled us to focus on 3 main pillars: 1, profitability of the current portfolio 2, growth initiatives and 3, organizational culture and health. These estimates translated into initiatives such as the divestment of underperforming assets, the introduction of new products tailored to the needs of each of our markets and others concerned with increase of operating efficiency and capital allocation. In this vein, flow has been crucial to the results we have achieved so far, and we expect it to make an even greater contribution in the future. Now let us continue with our quarterly results. Sales in Mexico grew 14% during the 3rd quarter and 9% during the 1st 9 months of the year due to the strong demand for our storage and water flow products, including the new ones that we were added to our portfolio as a result of flow initiatives. As to our water as a service platform in Mexico, our drinking water service, Bevia, grew 73%, registering record sales and higher average ticket. Drinking water fountain business grew soundly, recording revenues from contracts that were signed in previous quarters. The uncertain environment had a negative impact on mid investment and as a consequence of the demand for water treatment plants in Mexico. Also the number of plants that have gone from the integral model to all the operation and maintenance could not be compensated without the start up of new ones. Despite having a robust booking, the mobility restrictions caused by COVID-nineteen have delayed projects execution. The quarterly adjusted EBITDA decreased 14% year over year due to expenses related to our adaptation to the new normal and the investment to grow and expand the purification platform. As for Argentina, net sales grew 29% in local currency, but they remain at the same level of Horacio Mexican pesos as a result of the depreciation of the Argentinean peso. Furthermore, we estimate that the operating restrictions I mentioned early reduced our sales by MXN30 1,000,000 during the quarter. Nevertheless, our pricing strategy, street expense discipline and growth in storage and water flow volumes helped to double the quarterly EBITDA. Sales in the United States continued to grow at a double digit rate driven by the migration to online consumption, the American winter home improvement trend and the increase in water storage needs due to the time families spend at home because of the confinement. During the quarter, we carried out an optimization of the e commerce platform, which has enabled us to triple our sales conversion rate. We also opened our 8th physical store in Fort Worth, Texas. Sales in Central America also increased by double digits. In spite of the disruptions to our operations, thanks to the optimization of our sales force productivity and the incorporation of new products to our portfolio, Greater synergy between the countries of the region have reduced sales and profitability. Tarru increased its sales by double digits. As anticipated, the recovery trend that followed the June reopening, combined with the introduction of new sales channels and new starch and waterfall products, as well as the synergies with our Argentinean operations, contributed significantly to this result. Finally, after the divestment of our product unit in Brazil in May, we continue to focus on strengthening the premises of our water as a service platform in that key market through our treatment and recycling water plants, of which 3 are now in operation, 3 under construction and 1 in the last stage of contract signing. In terms of our portfolio mix of products, during the quarter accounted for 93% of total sales and grew 20% mainly due to the strengthening of our supply chain, increased demand for water solution and also the operative weakness that some of our competitors have during the period. Sales of our services accounted for 7% and decreased by 4% in spite of the strong performance of Bevia and drinking water fountains. This is due to the uncertain investment environment that affected, as mentioned, new water treatment plants contract and COVID mobility restrictions. Bevya reached more than 42,000 installed verification units and the average ticket is increasing as people are choosing outcoming water or more sophisticated purification technologies as reverse osmosis. Meconception habits and microtendencies like avoiding single use plastics, reducing carbon footprint and wellness are boosting the purification platform. Now moving into our balance sheet. Our cash position is important to highlight that we optimize our cash conversion cycle by 23 days as a result of the renegotiation with our clients and initiative originating in flow that continues to be closely monitored by the weekly cash control tower. During the quarter, the strong operating performance contributed to increase our cash position in more than MXN200 1,000,000 to reach cash on hand to an equivalent of MXN3 point 4,000,000,000. As I have already mentioned, our net debt to EBITDA ratio is 0.5x, well below our 2x ratio policy. Our debt position considers a sustainable bond at 2017 2x, which as we have discussed in the previous quarter is net MXN4 1,000,000,000 and has a maturity date in June 2027 and has an 8.65 percent fixed rate denominated in pesos. It also considers a COP65 1,000,000 loan in Peru that we took last quarter, which was meant to help alleviate the pressure caused by the lockdown in this country. The loan has a 12 month grace period, 1.49 percent annual interest rate and a 3 year tenure. Our debt maturity profile allows us to be flexible and have enough liquidity to keep our growth pace for the following quarters. As for CapEx, this remains at 3% of total sales, amounting to COP207 MXN207 1,000,000, of which MXN 63 1,000,000 were allocated to new water treatment plants in Mexico and Brazil. Dollars 26,000,000 was allocated towards Argentina for productive improvements in the Waterfall business and $6,000,000 for the digitalization of the customer service platform in that country, and $130,000,000 for the impact of multiple initiatives within the flow program. Now moving into ROIC, which this is the key variable. In terms of creating value for our shareholders, as Charlie has remarked, we remain strongly committed and encouraged towards our objective of having a ROIC rated an hour walk by year end. We reached a 9.8% ROIC, just 86 bps below the WACC that stands at 10.7%, representing the tightest gap between these two ratios in the last 17 quarters. We have achieved this within the flow framework by pursuing a diverse array of initiatives and actions, some of which we have discussed in previous calls and that can be summarized as follows. We created a cash flow control tower to ensure greater discipline in capital allocation. We have increased production efficiency in our manufacturing processes. We developed a divestment strategy for underperforming assets like our former product unit in Brazil and our manufacturing assets in the U. S. So we can focus on new venues for growth with greater potential and profitability. The launch of new products and services, one example is Riego, which Charlie has already mentioned. The development of new sales channels and to be more effective in our sales approach. We have restructured and realigned the company's human capital. We have improved our logistics in term of cost and efficiency. And finally, we keep a very strict expenditure discipline across all of our operations. In terms of ESG, we are committed to creating value for our shareholders. But at the same time, we are committed to ESG principles and best practices. We seek to have a positive impact while generating profitability. We have undertaken initiatives on talent development, client focus, climate change risk assessments, collaborative platforms and the development of key performance indicators and an objectives and key results approach. The results of these initiatives are detailed on our ESG KPA dashboard, which is available on our website. The dashboard details our most relevant environmental, social and government results since 2016. And together with our recently launched sustainability management system, we'll strengthen our efforts to increase the uptake rate, measure and improve our ESG performance while reaffirming our commitment to transparency and accountability on this matter. Moving forward, our strategy is to grow our water as a service platform, maintain our product leadership and pursue new business opportunities. We will also seek to maintain our brand leadership in all the markets as well as continue to implement a price policy line to keep a good growth. Additionally, we will continue to ensure that our operations are self sustainable in terms of cash flow and that we don't take any local debt. Finally, we will continue our current business development strategy in Brazil, Central America, Peru and the United States, introducing new water solutions to our portfolio, exploring new distribution channels and optimizing our operations. As a company, we believe that we are uniquely positioned to have a positive impact for our customers and communities and to create value in the process. As Charlie said earlier, we have relied on the strength of our brand, our market leadership, our quality and innovation. Our financial strength to address the present and future is very good, so we can address the water need of our customers. As some of you may recall, back in February before all these health and economic crisis happened, we expected that for 2020, we will be achieving our net sales greater than 10%, EBITDA margin equal or greater than 18% and net debt to EBITDA below 2 times and ROIC equal or greater than WACC. As you can imagine and attest it, we refrain from giving guidance in the 1st 2 quarters of the year due to the extraordinary circumstances that we are all going through. However, after all the efforts we have undertaken and our strong results in this quarter, we believe that the guidance for 2020 is still feasible. In the session held yesterday, the Board of Directors agreed to call an extraordinary show horse meeting in November to propose a capital reimbursement in kind. The company will distribute shares that it already has in treasury. For the payment in kind, the following will be proposed: delivered to each other of 18 shares of the company or one share as a payment in kind for the reimbursement. If in any case, the payment in kind with share results in a fraction of a share, Said fraction will be paid in cash to the corresponding shareholder. We estimate that the date of payment will be between November 27 and November 30. Just before jumping into the Q and A session, I would like to mention that we were included in the FTSE VIVA Index of the new wholesale institution, Alga Vallores, which brought us our investor access to our shares and reaffirms our position in the Mexican store market. So now, thank you very much for your attention. We will now answer any questions you may have. If you can go through the Zoom platform and use a Q and A button, so we can you can submit your platform or if you want to open the mic and do the question by the way, we are open also to take it that way. Thank you very much. I guess we're getting better, Matt. You had reporting. Yes. I imagine so. And we'll allow for a minute otherwise. Sure. And please, any questions regarding health, business performance, any details on the flow transformation program? Hi, Mario. It's Rodrigo from AUM Advisors. I just have a couple of questions. Of the adjusted EBITDA that you report, how sustainable do you see this number to be in the coming future before the flow expenses, the BRL450 1,000,000 EBITDA. Can we expect this to continue going forward? Or do you see like some onetime effects in this number? And another question, it's about the flow expenses too. We expected a smaller number on that. And I know it's correlated with the results they give, but what can we expect going forward from this expense? Thank you. You want to take the first one, Charlie, and I do the flow expenses? Go ahead, Mario. Thanks, Rodrigo. Thanks for joining us this morning. In terms of the sustainable EBITDA, there's no one timers on the revenue side or any extraordinary effect that causes to have such a strong performance. We believe the company is in a very good position that to keep that performance going forward. When I mentioned that the 2020 guidance is feasible, if you do the numbers, we are looking at a very similar 4th quarter than the Q3. So and as flow gains more traction, things will improve quarter after quarter. All things stand the way it is because the only thing that really undermines or can undermine these performances that the lockdowns in the countries. Whereas, you know, still going into 2021, there's not a clarity of how the COVID-nineteen can impact people and the businesses. As for the flow expenses, first, we want to bring full transparency and clarity to the market on how much money the company is putting into this program. And that is why we have reported that way. We in order to come up with the way we're reporting FLIRL, we started 16 different companies that public companies that has go into this type of programs. And I would say there were 2 main trends. 11 companies report on a quarterly basis the transformation expenses as the quarter moves on. And 5 of the 16 preferred to have kind of the full impact of the transformation and they reported costs. We prefer to start reporting those costs instead of waiting to have the transformation mature and then put the whole expenses that the program incurred. Having said that, first, the flow transformation program has a very good IRR. I don't want to be pretentious, but it has an IRR above 100%. On our base case scenario flow, we expected to have a cash on cash return of 6 or more times in 5 year timeframe. And finally, you should expect at least for the next 4th quarters that we're going to be reporting flow expenses in the magnitude that we report in the Q3. So I don't know if that addresses your questions, Rodrigo. Yes, that's perfect. And if I can I have a follow-up on that? It seems they've been or you guys have been working a lot on working capital and we've seen a lot of improvement there. Do you think some of it can reverse in the coming maybe next year or the coming quarter? And how far can this flow program go? You always talk about the EBITDA margin expansion in, I don't know, in some time frame. Does that maybe long term guidance continues or maybe can improve with these things you're seeing from the flow program? [SPEAKER JOSE ANTONIO ALVAREZ ALVAREZ:] So let me answer to your second question and also to give more information to a question by sorry, Ileana. In terms of sustainability of double digit growth in Mexico or what we can expect from Flow, which are related? And then you can answer the other one, Mario. But Flow, we did an independence due diligence at the end of last year to identify what was the opportunity that we saw for the short term. We generated then a bottom soft plan we did a lot of ideation to generate initiatives. And most of those initiatives are being executed in 2020. For the revenue driving initiatives, a lot of them have a ramp up period. So when you do launch a new product, it takes a little while before you get to a reasonable market share. I can tell you that in 2021, we will see benefits from initiatives that have been already executed and that what the hypothesis have been validated. Also, seeing that this is a very good recipe for evolution in alignment with our strategy and in alignment to value generation, we've gone to replicate this evolution model. So now rather than just being a one time transformation, let's say, it's going to be an ongoing evolution, route to plus way of working. And we do see that we will be able to sustain double digit growth in revenues for a fairly long period of time. We have tremendous opportunities in both the products and services space in markets such as Brazil, Mexico and the United States. Even though we've been for such a long time in Mexico, I believe we're just scratching the surface in terms of the solutions we can provide as the world is continuing to see higher and higher levels of water stress. Mario, do you want to answer the first question? Sure. Working capital? The way this transformation works, Rodrigo, at the beginning of the transformation, you see more of effects such as working capital optimization because that's easier to implement. And that will be let's say that's a setup We'll keep on going forward. While it's starting to pick up because the sales grew with new products or services such as RIIIGO that takes more time to ramp up. So you're going to be what's going to be seeing forward it's a cash conversion cycle very similar to the one you saw in the Q3 going forward. And you're going to be starting to see some increase in the speed of growth because a lot of the initiatives coming from the transformation will start to gain traction. So at the end, and that's what we are targeting in 2024, 50% of the incremental EBITDA will be coming from growth tied to the transformation and 50% will come from savings throughout the process. And the one time, the ones that you saw in the working capital, that effect will only be seen once, which mostly happened in the Q3. We have some questions on the chart. First one, Charlie, David Simon, thanks for joining us this morning, David. He's asking us about a couple of questions about the slowdown in Ctesa deployments and to discuss implications for CapEx going into 2021. And if our ambition decline with the Ctesa or just defer? That's two questions are from David. And then we have with the Bevia. With Bevia having accelerated and then seemingly decelerated again during COVID-nineteen, How has your view evolved with regards to more catalyzed metrics in terms of growth in installs or ASPs or churn that will drive the long time customer value divided by customer acquisition cost calculation in the future. So do you want to take on those, Charlie? Yes. Please complement, Mario. But David, thank you very much for your questions. In terms of Citesa, we had a beginning of growing bookings in 2017, then 2018 was even a better year, 2019 even a better year. And we've been consistently growing bookings. This year, we've had a very challenging first part of the year, but we are seeing that as we close the year, there's initiatives for water treatment plants that can't be postponed forever. And so these projects are beginning to close. So we do expect to still have a reasonable year in terms of bookings for Citesa. And so in terms of capital expenditures for next year, we don't expect CapEx for water treatment plants to be reduced in an important way. And in terms of what we see for Citesa in terms of our aspiration moving forward, is still very aggressive as we have also started to focus on what treatment in Brazil is in a tremendous opportunity. The level of verifications in Brazil and law enforcement in Brazil is much higher. So the need for these solutions is even higher. So we do see that Brazil is going to be also a driver for the water treatment business. And we're also considering new markets. As we have realized that we have developed in Mexico a tremendous capability for designing world class engineering for water treatment with very attractive times to developments and also very attractive cost benefit ratios. So again, our aspirations not only remain high, we think that they will continue to grow as we continue to validate the hypothesis. We do see a slowdown in some of the revenues from water treatment because some of our long term customers contracts have gone into a second phase where we're doing only operations and maintenance. And so the outflow of that pipeline wasn't met by booking that hadn't happened in years before we acquired the company. But again, the bookings that we've the capability for booking and closing contracts that we developed will start generating very good results as we move into 2021 and 2022. Anything you'd like to add regarding TETASM IO? I would just only add to the 3rd component of David's question. Thinking about CapEx 2021, as Charlie said, our ambition has not changed. There's it's only deferral. So you will see some of the CapEx that was not executed in 2020 flowing into 2021. In terms of Bevya, we have not seen a slowdown. We have consistently seen growth in revenues and new customers. The customer base continues to grow in a very aggressive manner. We have not been disclosing details on either Citeza or VIVIA, but we have been discussing on about being able to start sharing more information for the reports on 2021. So on April of next year, we will start sharing some more information for you to be able to model better for these businesses as we understand that the more they grow or the more rapidly they grow such as BPI, the impact EBITDA negatively and it's challenging to model. Now in terms of customer lifetime value and the relationship, the ratio to customer acquisition cost, that is probably the metric we'll be sharing. And I can tell you just in advance that we do have a model that foresees for attractive ratios in terms of customer lifetime value over customer acquisition cost. And so that's what we can disclose to the moment. And then we have another couple of questions, one from Christian. Juarez. Thanks for joining us this morning. He's asking us about if we are foreseeing more extra personnel for the coming quarters, the answer is yes. And this is how we are operating. We have multiple sites, manufacturing sites. We have designed specific SWAT teams for manufacturing or warehousing. So in one shift, we have a complete case. We isolate the whole shift. We send them to their homes. We provide help as needed. And then that's what teams takes over and operates that shift. We've been doing that to keep demand up. And obviously that has extra cost, but we believe that's much better than shouting out at the plant or not coping with demand. So that's how we operate. 4th quarter is going to be the same in 2021. The year is still out there, but we believe the COVID situation will still take some time to come back to normal. Then we have another question on Regina. Carrillo, Regina, thank you very much for congratulating on our results. And she's asking about the remaining shares in the treasury. We're going to keep them in treasury and see next year what's the best use for them. As you know, we always have different alternatives for those shares in treasury. And we'll keep you posted as we always do next quarter. If there are any last questions that you'd like to do over the microphone, please raise your hand. Yes. There's one question from Juliana Elion. And she's asking if we could if the sales in Mexico are if we can give more color and if it is sustainable to continue growing double digits? Yes. I spoke to that when I was talking about flow. So thank you very much for your question, Eliana. But we do see this to be sustainable. Just to give you an idea, we'll be launching in this period of flow between this and next year probably as many products as we've launched in the whole history of the company. We're close to that. So our intentions, our initiatives to grow our offer with a very high level content of customer centricity, looking to optimize the user experience is tremendous. And so we do expect to grow revenues consistently for a long period of time. A follow-up on that. What is driving those current sales? Is it only the new products? Or are you seeing a different trend in consumer or informality or government programs, etcetera. I don't know if you can explain a little bit more on that. The government, as we've discussed in the past, is not a big player for our business anymore. That was a decision we made. But in terms of what's driving revenues, the way we approached the transformation with Flow was through multiple initiatives. So it's lots of things that are driving revenue. So it's everyone in the company, a very big percentage of the talent in the company working and identifying opportunities, designing initiatives and executing those initiatives. So it goes all the way from Salesforce Excellence to driving digital capabilities such as CRMs to having new products. So it's really very holistic approach and it's built based on lots and lots of initiatives. And just to compliment on your answer, Charlie, if I might. This quarter, we have a very significant increase in market share. And that speaks to what Charlie is mentioning, sales were excellence, more digital marketing, larger portfolio of products. So revenue has been driven by the organic growth of the current portfolio. The new portfolio is starting to pick up and the good sales and marketing practices who is translating in better market shares. This is not a coincidence that in all the markets where we operate, we gain significant market share. And we are number 1 brands in all of those countries. So I think it's a mix, as Charlie mentioned, and it's really having all the company in a very good alignment with very clear initiatives being executed with a good cadence and timing towards creating value. There are no more questions. We thank you very much. Is there any final message, Mariana? I think that's all, Charlie. Thank you very much for your attention. We will now answer any we'll now keep you posted with anything that may occur in the next quarter. Have a nice day. Thank you very much. Thank you. Have a good day.