Earnings Call: Q4 2020

Mar 5, 2021

Good afternoon, everyone, and thank you for standing by. Welcome everyone to B2W's Compagnie Editas audio conference to discuss results relative to the Q4 2020. Today with us, we have Mr. Rauly Lapages, the company's IRO. In order to follow the conference, we suggest you resort to the support slide deck, which can be found at ri.b2w.digital. This event is being recorded, and all participants We'll be connected in listen only mode during the company's remarks. After that, we'll have a Q and A session when further Instructions will be provided. To the help of an operator by pressing star 0. A replay facility of this event will be made available right after its closing for 1 week. Before moving on, we'd like just to be sure that forward looking statements made during the call concerning the company's business outlook as well as operating and financial targets are based on the company's assumptions and beliefs and also based on information currently available. Such forward looking statements are no guarantee of performance. As they refer to future events, they involve risks, uncertainties and assumptions and thus depend on circumstances that may or may not materialize. Investors should have in mind that general economic conditions, industry conditions and other operating factors might affect The future performance of A2W Digital and thus leads to results that will differ considerably from those expressed in these forward looking statements. I'd like now to turn the conference over to our speaker who will start the presentation. Please, Mr. Laparges, you may carry on. Good afternoon, everyone. Thank you for participating in our earnings call for the Q4 2020. Today with me, We have Mr. Marcio Cruz, the company's CEO. I'll go through the year's highlights starting on Slide number 2 and then I'll turn it over to Marcio. 2020 was a year that can be told reported in several different ways. We started our 3 year strategic plan from 2020 through 2022, which has as its main purpose to be even more relevant and the clients' day to day activities. And this slide is still in January. We achieved a new category as we acquired Supermercado now. All of a sudden, we faced a challenging scenario due to the COVID-nineteen pandemic. Facing that, Customers' behavior changed completely and fast, but we are a digital company that allowed us to be even more agile, seeking innovative solutions to better meet clients' needs. Putting in practice our motto of offering everything Anytime, anywhere, we have expanded our assortment and started delivering essential products on the very same day in up to 3 hours across different 700 different cities. For retailers who had to close their doors, we launched a new operation, the to Marketplace Locale, digitizing small businesses in small neighborhoods and allowing them to continue to sell through our websites. Innovations did not stop there. We mix entertainment with sales, bringing the live commerce phenomenon to Brazil. We have also optimized our capital structure with a capitalization of BRL 4,000,000,000 and we debuted international market of debt, Issuing bonds at the tune of US500 $1,000,000 We are very proud of everything we've done throughout the year, especially proud of our team. The amount of actions executed in such short period of time In light of so adverse circumstances, it was only made possible to a highly qualified team which dedicated to the most to ensure clients would receive Essential items in a safe, fast way. Those actions were key for us to achieve important results in 2020. Moving on to the next slide, we highlight the results of the 4th quarter. GMV reached R9.2 million dollars, a growth of 30.2% when compared to the Q4 of 2019. In the same period, net revenue reached the amount of RMB3.3 billion, up 50%. Adjusted EBITDA reached BRL386 million, which accounts or represents A growth of 51.7 percent vis a vis the Q4 of the press 2019. So the adjusted EBITDA margin reached 11.6% in the 4th quarter of 2020. The net result came out positive at BRL16 1,000,000, reverting a net loss of minus BRL22.3 BRL1 million in the same period of the previous year. In the quarter, we reached a cash generation of BRL780 1,000,000, a growth of 50%. On Slide number 4, we'll comment on the results for the whole year 2020. Total GMV reached DKK27,700,000,000, a growth of 47.6% when compared to 2019. In the same period, net revenue reached BRL10.1 billion, a growth of 52.% When comparing to the previous period this year, adjusted EBITDA reached BRL 950 1,000,000, a growth of 58.3%. So adjusted EBITDA margin reached 9.4% in 2020, a growth of 0.4 percentage points when compared to 2019. Net result reached an evolution or growth of 48%. In 2020, we reached a cash generation level of NOK 306,000,000 up 61%. Those numbers show the strength of our digital platform, which is combining growth, profitability and cash generation. On Slide number 5, we highlight our cash generation throughout the past 5 years. As a result of the growth of our business models, we have reached A cash away positive cash generation for the 2nd consecutive year in 2020. Cash generation came out at DKK306 1,000,000 Accounting for an evolution of 1,900,000,000 vis a vis cash consumption filed in 2016. We are extremely motivated and confident that we'll accelerate our growth even further, Maintaining the commitment of steel generate cash. On the next slides, we'll comment on the operating highlights for 2020. On Slide 7, we highlight the evolution of our active client or customer base which reached 21,400,000 in 2020. This period we have conquered 5,500,000 new customers, expanding our active buys in a year, the equivalent of 5 years of growth combined. Those numbers contemplate only the digital platform. When we look at the Universal American as a whole, We have over 46,000,000 active customers and a total base of over 80,000,000 registered customers. On Slide 8, we'll comment on the acceleration of our purchase frequency. As a result of our high frequency operations. The number of customers with 2 or more orders in the Q4 saw a growth of 53% when compared to the same period of the previous year. The increase in purchase frequency is one of the priorities of our strategic plan, our 3 year strategic plan. On Slide number 9, we see the evolution of the sellers and assortment base. B2W Marketplace connected over 40,500 sellers in 2020, totaling a base of 87.3 1,000 sellers in December. That was a year with the highest number of connected sellers since the creation of the marketplace back in 2015. This way, we managed to exponentially expand the offered assortment, which more than doubled when compared to 2019 with the addition of another 57,700,000 On Slide number 10 now, we highlight the performance of Americanas Mercado, the largest marketplace in Brazil. We still I wish you're moving on in the category with a growth of GMV of 9 fold in the Q4 when compared to Q4 of 2019. The category has consolidated as the largest under B2W for these items that we sell. The expansion of the operation continues to move on including strategic partnerships with companies such as Carrefour, Grupo, Big and Macro, Allowing for the integration of another 1100 stores across 18 states in the country, focusing on offering a complete experience and 100% digital for supermarket purchases including fresh produce. We offer an end to end platform to our partners including Software as a service solutions, payments, picking, customer service and delivery or same day delivery. On Slide 11, we highlight the LEX, the main log tech in the Brazilian market, which through intensive use of technology operates in an asset light way in a multi mode platform in which We executed over 49,000,000 deliveries in 2020. Throughout the year, we continue to expand our logistics network, Opening 5 new fulfillment centers totaling 22 across 12 states, 22 fulfillment Thank you. Let's also operate with 200 hubs and over 5,000 stores connected to the ship from store mode, Creating a unique footprint which allows us to deliver faster and offer a better experience to customers. The Q4 of last year, we consolidated as the fastest delivery company in Brazil with 1,100,000 orders delivered in up to 3 hours, which accounts for 11.5 percent of our total deliveries. Our delivery coverage in 24 hours has reached over A 1,000 cities with same day deliveries reached 40% of the total order volume in the 4th quarter. On Slide 12, we'll comment on our O2O initiatives online to offline. 2020, those initiatives totaled 3 700,000 GMV, a growth of 95% when compared to 2019. The Infinite or Endless shelf is available across all 1707 Americana's store in the Q4. The operation saw an average ticket of approximately 20 times that of the physical stores. We closed the year with 11,169 click and collect points of sale including stores, partner points and lockers. The PEGI in Awazha OG is available across all Americana stores and in 4,500 Seller's stores totaling over 6,200 points of sale across the country available for pickup in about in up to an hour. The ship from store is already available at over 5,000 stores, including Americana's stores and also sellers' stores. At the end of 2020, we have increased our offer our assortment and started delivery of large to size items such as TV sets and microwave ovens. The ship from store is operated by Amiflash, our proprietary platform of crowd shipping, which counts with over 20,000 connected delivery people. On Slide 13, we present the mobile highlights. As a result of our investments in mobile platforms in 2020, Our apps totaled 62,000,000 downloads. The Americanas app was the most downloaded app in the category of purchases in Brazil. In the Q4, our apps totaled 39,700,000 users or active users per month, to MAU indicator. Slide 14, we present a fast evolution of the AMI, our fintech and also our mobile platform under the Americana's universe. The number of downloads Grows steadily exceeding the level of $17,000,000 throughout the year, have established several strategic partnerships, Speeding up the acceptance outside of the platforms and totaling approximately 3,000,000 establishments or 3,000,000 outlets. This way, The total volume of payments, TPV, reached SEK 5,900,000,000 in the 4th quarter, a growth of 202 percent vis a vis the same period in 2019. In addition to be a payment platform and a powerful loyalty tool, AMI continues to be a significant tool for our growth and to expand our model to other businesses. Along those lines on Slide 15, we highlight important acquisitions that we made in the period. In December 2020, Amy made 2 important acquisitions to speed up our financial platform, a Bitcapital and ParaT. Bitcato is an open banking platform which is modular and based in blockchain and open APIs which offers solutions to make the integration to the financial ecosystem in a very simple and safe way. BIG Capital also offers solutions to integrate with the PIX, our instantaneous payment system managed by our Central Bank. ParaChi has direct access to the Brazilian payment systems and also to instantaneous payment systems And operates as a bank as a service and is a regtech integrating fintechs to the bank system or to the banking system. Now I turn the conference over to Marcio who will go on with the presentation. Thank you, Ramy. Good afternoon everyone. It's a pleasure to be here with you. Well, the year 2020 was quite challenging for all of us, Totally unpredictable and that required a very high ability from all of us to be Fast on the trigger as a company, that scenario also brought about important changes and the behavior of our customers. They are all increasingly after digital stimuli solutions. And all of that combined with the opportunities we identified allowed us to accelerate our strategic plan as we start 2021. I'm talking about our 3 year strategic plan that especially true for 2021. And this was communicated Our Investor Day late last year for us to really accelerate our growth. I would like to share with you A balance of 2020, a great balance and then comment on the challenges and priorities for 2021. So as a positive highlight, number 1, our team, the amount of Actions we were able to put in place, decisions we made throughout the year amidst And for a situation that was only made possible because of our highly skilled, qualified and engaged team for that to happen, we Made a series of decisions. We were of course, we put health first. Our number of priority was the safety and the health of our team and our customers. And we implemented several initiatives even when compared to other benchmark companies and competitors. We managed to increase our team's engagement. And as a consequence, when you look at the numbers, we once again We're acknowledged as a great place to work and we improved our score when we compare 2019 with 2020. Also, they got recognition, the acknowledgment from customers. Once again, they have Pointed our brands as the number one most loved brands on the Internet. We had The best index is both in 1P and 3P. 3P were the 1st marketplace to be recognized with the RA1000 for the Americanas.com. That was an important milestone for us, which also reflects the acknowledgment from customers that of course It's driven by several actions we put in place throughout the year to improve customers' experience. And to end, we brought about more convenience, More speed. And the third point is our capital structure even within a very Unlikely scenario, we were able to optimize our capital structure with 2 important operations. Number 1, our Capital raising of SEK4 1,000,000,000 which was quite well success quite successful. And number 2, we issued debt Internationally with a 10 year bond at the tune of US500 $1,000,000 that are important as well that allows us to Take on a new growth path. Also as a positive highlight, we it's our cash generation, our commitment. Once again, we We'll close our strategic plan for 2019 generating CHF 219,000,000 cash last year. The objective was to grow and generate cash NOK 306,000,000 last year. So that's also an important positive point as we continue on our growth with profitability back. In other words, sustainable growth. Next slide, I have also identified areas where we could have done better. We are already addressing those points. We started late in the year. Number 1 was growth. Even though we grew 48% above our plan and above market, We see opportunities there as well. We can grow even further when we look at the other players in the market. So we have Defined as a metric to grow above the average posted by our top competitors, by the top players in the market I have identified as I said several opportunities for us to do that. Number 2, performance in the marketplace front. As we see it, it could have grown even more, it grew slightly below what we were expecting. We are focused on improving our competitiveness with sellers and also on improving their experience within our platform. That has been our focus as we started the year. We Having implemented a new version of our marketplace platform with new rules and we already see the results of that. We are now Providing a better experience for sellers and customers as well. Number 3, something could have done better as well as we see it Has to do with user experience, we have been expanding our assortment exponentially. This was said we have exceeded 87,000,000 items that we offer in our assortment. And then of course, it brings along the challenge of offering a good experience for customers. They have to be able to find those items and make a purchase. So that's something we are focusing our attention and we need to change level, right? We need to bring a user experience which has a lot less attrition, which is more fluid. And lastly, we talk about fast deliveries. Of course, that's a point where we want to establish a new Our reference, we are focusing on the 3 hour delivery. Those deliveries already account for a significant number in our revenue, 11% in the last quarter. And now we're talking about improving speed for 1P and 3P delivery speed using our logistics Network and also the over 1700 Bericanes store that we have spread across all states So that you can really offer customers a service level which is much better in a much shorter period. So we're going to be using all the tools we have available to us, being on the fulfillment for O2O deliveries, especially for those very fast deliveries because they bring a very high level of satisfaction on part of the customers. On the next slide, based on all those points that we identified as opportunities, We have optimized our growth algorithm. It has 3 main pillars which are quite important. Number 1, Purchase experience for our client customers, number 2, loyalty custom loyalty to increase Recurrence in purchase. And number 3, we need to be telling that story to our customers. We need to be closer to them, to be Present in their minds and reinforcing those messages around services that I've mentioned. So have those 7 variables. We have already had the chance to comment on them and talk about them to you. So all the actions are somewhat guided by that Algorithm that you see on the screen and for that to be deployed in a very efficient way, we are investing in people, we're investing in training And we're also investing in bringing people on board from outside of the company. And we have, as I said, Investing on the intensive use of data and possibly strategic acquisitions which are also part of this growth algorithm both On the long tail front and also as an enabler, as a result of the issues on the next slide, Slide 20, We have our growth. We moved from a growth of 38% in the Q4 last year to a growth of 83% in January. And we have already reached a growth level of 90% in February of this year. That growth already represents And those initiatives, the decisions we made to get on a faster track for 2021. Now moving on to the last Slide of the presentation. This is our the backbone of our strategic plan And it's increasingly more relevant in our customers' day to day. That means we need to be increasingly present in different Consumption journeys moving forward in the long tail and offering increasingly more convenience to our customers being faster, investing more And service levels, just to reinforce one of the points I mentioned, we continue to focus on a faster growth and also on sustainable growth, growth with sustainability and cash generation. We're extremely confident Going forward for 2021, the 1st 2 months are a sign that we can be confident that we are on the right track and we'll continue to move forward on that direction. I'd like to take the opportunity to Thank our team, especially for their hard work, dedication, engagement and also our suppliers, sellers, marketplace, shareholders and especially our customers. So when I give the floor back over to Raul Knie for him to continue with the presentation. Thank you, Marcio. So these were the main remarks we had for the Q4. And now we will move on to the Q and A session to address Comments or questions you may have. Thank you. Ladies and gentlemen, we'll now start the Q and A session. We have a question from Luis Guanais of BTG Pactual. Thank you. Good afternoon, Raul and Marcio. I have two questions about the last points you have discussed. Could you expand on sellers and the new commissioning policy, so we look at the Numbers in February and whether these initiatives have been already captured. Now my second question, Marcio, It's about the speeding up that we have seen in January February. Thank you. Luis, thank you for your question. This is Raul Nie. So the first point of your The second question is to Marshall, so I'll turn it over to him. Now as for your first point, the new policies. When we decided to speed up our growth pace, we analyzed all the variables For this growth and marketplace is a very important unit In our business and in our growth plan, for sustainable growth of marketplace, we have to be close to sellers. In the last few years, back in 2015, we have seen the inputs took into account Sellers feedback. We are building this business together. Sellers are our partners. With all the change that we have put into practice, these are based on demands that were brought by these the sellers. So Canceling for instance and other changes that can make Sellers activity more predictable so that they may become more competitive on our platform. Also a free Freight policy on marketplace that of course as long as it's sustainable attached to improved service levels. So this exchange with sellers, we really believe that this is a business we will build together. So this is A great amazing vision that is now reflecting in the growth rhythm that we have seen in January and February, this was highlighted in our press release. Our growth in January February was driven by our new Marketplace growth level. Of course, there's a lot to improve from now on. Everything that we have done of course is not completely reflected on these results. This is a continuous improvement process. We want to improve the experience of sellers and inside we will keep Working together on this journey offering more assortment with a better service level. This is Our new journey and we will have lots of new things to make marketplace increasingly more Competitive with an increasingly better service level for our customers. Thank you very much for your question. Now for the change in trajectory in the Q4 and then January February, how do I I have some highlights. First, I made a very important decision. We made the decision to grow. This was the first step. And then there was planning. We needed to plan in order to grow and growth Means in 1P and 3P. So when we want to make 1P grow, you need of course To arrange that with our providers and raise our inventory levels in 3P likewise we planned in order To grow with sellers, so we started to deploy many measures we've been studying before, Including the new marketplace policies, we heard from sellers a lot and this is a very common practice to listen to them, To get their feedback and at the end of the day, we really want to Evolve, develop and grow together with sellers. This is our goal. And these Where the points that we addressed in the new version of our platform and this has been translated into growth, Especially after February, when we look at January February, There was this growth that was even above our expectations and plans with Less investment, slightly less investment that we had planned and this is great. It means we're on the right track In terms of growth from now on, all these changes that were that have been implemented, I've just given you a few examples. They're also driven by our 2020 achievements. As Raul Nee mentioned, we have evolved our customer base over 5,000,000 active customers on our base And many more recurrent customers. When you look GMV growth, It's not comparable to items sold, so they're buying more from us. There's more recurrence on our platform And these are assets and strengths that we are carrying over to 2021, Not to mention the expansion of our logistics network in order to offer better services. So we have anticipated The opening of warehouses or distribution centers. We've also increased our consumer base at Amaze Which makes the platform again increase its recurrence level. So these were all driven by the new Measures we have taken with more rapid growth. And of course, when you have a scalable platform with Such as ours that's ready to grow. So when you connect all these dots, a platform that has a lot of capacity to grow, Of course, this is an expected result, accelerated growth in January February. That's it. That's okay. Thank you very much, Marcio. Thank you. The next question, Gustavo Oliveira, UBS. Thank you for taking my question. I need to understand how U. S. To make the Impact of all these incentives and changes that you've been explaining, everything you have in your pipeline. So what could be the impact of these on your Profitability, both gross and EBITDA margins, you have this greater mix in 3P, of course it helps. But I don't know about the other Efforts or even 1P in what was arranged with suppliers, whether suppliers are also participating in So maybe you can understand the impact on the gross margin and on the EBITDA margin. Thank you. Gustavo, this is Rauli. Thank you for participating. Well, Gustavo, we don't have a Guidance, I cannot give you a number, but as Marcio said in the previous answer, This growth has been a result of our use of everything we have built along 2020. 2020 was a very important year beyond GMV and our assets. So Our platform and our business model is more mature, so we can now better calibrate our growth visavis profitability. The greatest highlight last year is that we grew and remained profitable. So we need to do some internal fine tuning to invest More in speeding up growth, but also being committed to cash generation. So this is also related to EBITDA. We don't have a guidance, but when we look at 2021, We will keep our commitment of having stronger growth levels and also preserving cash generation levels. The next question is from Daniela Azer of XP Investment. Hello, good afternoon. Thank you for taking my question. I have one that's a follow-up On the growth in January February, how does that compare to the market? Can you also Give us some more color on the change that might have occurred in this category. If Consumers are looking for new categories on your platforms. We have seen great performance on Household appliances and electronics, have you seen any change in behavior In these categories? And number 2, how do you see this growth throughout the year combined with your competition? You said you wanted to grow above the major players. So how do you see your Competition's reactions to your policy changes, do you see any change in the Competition landscape and the second is about the incentives you've made Americana's With these 7 variables, how long do you expect this policy To continue, is this for a short period of time? In other words, if customers adopt your program, They have a grace period. How does that work? Can you explain your initiative? Daniela, thank you for participating in our conference call. Your first point about growth And market, I don't think we should be discussing the market growth as a whole, that market uses some sources to predict growth. But when we look at the market as a whole, wherever you look, there is deacceleration, There is some slowing down, but we are doing the opposite. We're speeding up. So we have a lot of market share, Especially considering our performance in January February. As for the Competition and the reaction of our competitors, well, this is a competitive market. When you consider Latin America, that's where e commerce grows faster, the fastest and Brazil accounts for 50% of this market. So there is competition in this market and we want to be a winning player In this market, but that's not very different from what has happened before. This market has been competitive for a while. As Marcio mentioned in the first question, when we look at January February, we have grown More than we had expected with less incentive, less investment, less capital allocation than We had expected, in other words, we have been able to grow more from the assets we had built. So when we look at 2020, 2020 was not a race, it was just a starting point before a marathon That brought a very high level much higher than expected in terms of Retail participation, as a result we can now focus on sustainable growth. This is very important and this is linked directly to the other two points you've raised. When you look at the categories, in B2W, there has been growth in high frequency categories, market for instance, We acquired Nowe Supermercados and we have achieved amazing results, but then there are other categories where we have been making strides as well. So growth has been high quality and high frequency in line with our strategy of being relevant In our customers' daily lives and that necessarily includes purchases. Now your third point, which is connected to the other 2 about incentives including free shipping or free freight, that's not a temporary change. This change is being constructed in an organized fashion. It's well structured and it is as a result sustainable. These are new policies that don't have a term. They should be perpetual, especially when it considers free shipping. These are co Participation policies that come as a result of improved service levels. So that means a better Purchasing experience with faster delivery. So everything fits in these three elements, these Three points are covered by our company's strategy to speed up growth using the pillars that have been erected in the last Thank you. The next question comes from Thiago Macruse of Itau. Hi everyone. Good afternoon. My question is about digital. You have given us more information about this operation. Now I need to understand what are the levers of growth for this business in 2021 And how the action that was taken last year, how can that help you in this journey? Hi, Thiago. Thank you for participating. Well, we're really happy about AMI's result. 2020 was a year of significant growth. With AMI, Universal Americana has now more customer journeys. In other words, we are now participating more on our Our customers' journeys and experience that has brought many assets to the company. We ended the year with 17,000,000 downloads. That's a very significant number. In quarter 4, We reached a TPV of BRL5.9 million. This is a result of Growth not only on our platforms where AMI is a powerful platform, but also in what we call a fuzz. In 2020, we had landmark growth in AMASE network, Acceptance network with many partners including ABR, we're really happy to have this partner which has a high use Frequency, weekly use of the AMI app. So we have been able to Bring all these elements into our universe and Ami has of course yielded these amazing results that were reported In quarter 4, when you look ahead and we should remember that AMIA has been there for 2 years only, it's a very recent Initiative, so we look at these high figures, we may even forget it's been operational for 2 years only, But our business plan includes of course the addition of new segments and new business models. We are building a financial platform Within Army and we make these 2 highly strategic acquisitions of BIT Capital and ParaT. And when we look ahead, we are now living in moment of open banking, a bit acceleration, PIX accelerating and Ami already was pixelated, so in open banking and with fixed Payment and the modernization of methods of payment, it will have a crucial Role in the modernization of the Brazilian financial system. That was extremely clear. Thank you very much, Rauli. Thank you. The next question comes from Irma Isgaard of Goldman Sachs. Good morning everyone. Thank you for taking my question. Sorry if this question was asked before, I'd like to Explore the logistics issues that you are What are you considering for delivery, logistics, fulfillment? So when you look at 2021 2022, how do you see the balance between fulfillment, Cross docking, shipping in the total Mix of your GMV and how are you in terms of unit shipping costs? Do you see a decrease upcoming or is this a moment in which you will Invest, increase your space and technology, maybe investing in Routes with loads that are not with trucks that are not totally full. Maybe I need to understand all these points, logistics points. Thank you. Hello, thank you very much for participating. Well, I think we have made strides in logistics Throughout 2020, Universal Americana's well, we have a very powerful multimodal platform. Our distribution center combined with hubs and stores that have now play they are now playing an active role In our distribution operations, especially when we're talking about superfast delivery, that's 3 hour delivery, which has been one of our priorities. When we look at all these elements in 2020, we have made great strides. There are two figures that help us express this. The participation of delivery up to 24 hours and that accounts for 40% of the total deliveries in Q4 and when we think about superfastdelivery and in Brazil there's no other company delivering in up to 3 hours. We have reached a level of 11% of the total orders in quarter 4 or 11.5. They were delivered in up to 3 hours. When you consider all this multimodal platform and logistics Structure, there are 2 major factors, technology, Elexis LogTech, we don't have trucks, We have built a LogTech platform. In other words, we connect all the delivery companies, truckers, People that even use their own private cars or bicycles or even So this is a multimodal operation using technology for Structuring routes and also to go from online 1P and 3P, we want them to be as close as Possible to our customers to one of our stores, L'Arche's Americas, one of our partners on marketplace. So there are many possible combinations that can be made And we use data to provide better logistics. And then of course, our distributed Logistics network, when you look at 2020, we opened 5 new fulfillment centers. So we currently have 22 Fulfillment centers in 12 Brazilian states and we have 200 hubs. So our Network has grown considerably in 2020 and we want this network to serve our marketplace in 2021. So fulfillment will also grow. So fulfillment Also means co participation in our free shipping initiatives. So a seller that embraces fulfillment, so they get 60% free shipping that is offered in 3P and this is also Related to service level, so those that provide better service levels working With B2W, they get a greater share in free shipping and also faster delivery. These are the elements we have making our priority and we have been of course getting great results And they will be a priority in 2021 2022. So when you look at logistics, we have 2 priorities, those that deliver in Up to 3 hours and those that deliver in up to 24 hours is these are the two fronts we are addressing and working on. So by working together, We increased the volume of deliveries from 3B And that is added into our platform and that at the end of the day is really helpful because logistics at the end of the day is about volumes. So the higher the volume, the better or the denser the routes are and this means greater capacity to reinvest In terms of free shipping and that creates a virtuous circle with all these elements. Perfect. Thank you. Thank you. The next question Tobias Stingeli, Citibank, good afternoon, Marcio and Rauli. You have been investing a lot In this market category that is doing so well in terms of recurrence, now what about the economics? How are the economics of this business evolving? My second question, EMEA is Doing really well as well. You've mentioned its growth. How about Onance, IOHAS at AMI, please? Thank you. Hi, Tobias. Thank you for participating. As for your first point about the market, This is a marketplace business. So supermarkets now in Americanas Mercado, we have the largest Supermarket marketplace operation in Brazil with complete assortment. We have an end to end platform for our partners. So we have software as a service, integration, picking, delivery. As a result, we can offer 100 percent assortment of our partner supermarkets With a purchase model that's completely fluid smooth without friction We also follow a marketplace model. So our market operation is 1 in which we provide these solutions To improve the experience of our partner retailers and partner supermarkets and they Pay a rate that is aligned with our marketplace operations. So in terms of economics, there is not much of a difference between The market platform and our more conventional marketplace operation. About your second point about AMI, we don't want TPP, this is strategic of AMIS. AMIS has been operating for 2 years, Slightly more and the numbers figures are really amazing and TPV of us is Something that's not the right moment to share. A question about the Q1. Can you tell us about 1P and 3P? This is not the right moment to Disclose this information, we will be discussing the Q1 of course, but our marketplace has been growing significantly above 1P. This is the platform that has grown the most as a result of everything we've discussed And all the changes that have been made as we said, there will be more change upcoming. We believe this is a continuous improvement business, but marketplace is on a different growth level and there's a Large gap as compared to 1P and we're doing fine. It's growing well and everything that was put into practice has led to a higher growth level on marketplace. Okay. Do you have anything To share with us about SynShare sales, well that's another strategic information. In addition to same seller sales, we have to remember that in 2020, we had Gigantic growth on our sellers base. Since the operation was launched in 2015 we had the largest number of sellers in connection with us last year, almost 90,000 sellers and it's still growing Fast this year, so not only the sellers in our base, but the whole seller experience should be considered. Many small sellers need our solutions and they needed it during the pandemic And they needed to digitize fast. So they see BW as a crucial platform for their growth And digitization process and this is our focus. As for seller base brakes, we still prefer to keep that with us. Okay, thank you. Good afternoon. The next question, Joseph Giordano, JPMorgan. Good morning everyone. Can you explain more about FinTech and Army, which has been grown? So how much can you talk about this incentivized TPV and whether it's linked to any cash back As incentive and the second point about your strategy to accelerate your sellers And they're locked in. How are you leveraging yourselves and your seller Credit tool, especially considering what we have seen in the first Quarter and do you believe the company is becoming exclusive in its seller base? Thank you. Thank you, Joseph. As for your first point about cashback at Ami at Incentivized, there are 2 different business at Ami. There's NUS, That's a loyalty platform. So cash back is just a Replacement of our more traditional discount models by a much more powerful Possibility, which is cash back. When we look at cash back as we have already discussed In our last Investor Day when we see all the sales leverage that has Being brought to the platform, it was 11 times. When you look at the most traditional discount models, you couldn't lock these Customers in, you provided gave them their discounts and they could use it the way they wanted. Now With the cash back model, we have been, I mean, on our platforms, Universal America's platforms, Our customers have been much more frequent, active and recurrent and this is the beauty of cash back. You shouldn't be cash back as an expense, but rather as investment, in fact optimized investment Considering the investment we've done before made before, the data we've been sharing with you shows Ami's power As a powerful loyalty program, even more efficient than before. Ami has been Growing in many different segments. In some segments, we have cash back at the start. When we look at that investment in terms of CAC and LTV, I mean, LTV is wonderful. So it makes a lot of sense to invest this much. At the outset, as clients are more recurrent within the On the app and use more initiatives and even now as we also we've also built a complete financial platform having this Customer in house is extremely valuable. So this CAC is really low When you consider this with a very powerful LTV from now on, so we're really happy with cash back results. As for seller lock in and seller credit, we're not really concerned or much concerned about Seller lock in, what we need to be concerned is to make sellers happy selling with us. If they sell with other platforms okay, Brazil's e commerce has been growing considerably. There is enough room for several platforms, but we want us to be our sellers' favorite platform, the platform that will help them grow. This is what we want B2W to be for them and we have been improving Their sellers experience with us and we want to have lots of new things to make them Well, to keep them engaged with us, so we want to help them. Last year for instance during the crisis, We want to help our sellers to have higher investment capacity in their own operations, inventory. So we have other solutions like fulfillment and also technology solutions, pricing solutions, Data analytics solutions, we want to engage sellers. We want that B2 Tableau platform be their benchmark for Thank you. The next question is from Richard Gascard from Bradesco. Good afternoon everyone. Thank you for taking my question. First, I'd like to ask about Marketplace And the delivery of meals, restaurant food, I need to understand how this will evolve. And if you're thinking about having that More specific action taken for this category for it to compete with Ifood. And the second Category is, maybe you can explain better. I believe last year things were harder, but maybe you can tell us more about what We'll be with the marketplace in this category. Thank you, Richard for participating. As for your first point about delivery, well, there are 2 strategic points. 1st, Increasing relevance for delivery. These are high frequency segments In the market, so we have been working hard in food delivery. We have entered into some Partnerships last year and this was our first step into understanding how this category works and then to expand Not only Ifood but also drugstore, convenience stores, so we saw many opportunities When it comes to high frequency activities, in High frequency and also fast delivery, people that cannot wait, customers that want to get that in less than an hour And this is directly linked to our focus on the 3 hour delivery strategy or in convenience stores Up to 1 hour to achieve this, we have working on any flash operations. We have Over 20,000 connected delivery partners, So it can grow organically or not inorganically. So we will keep growing in high frequency delivery categories like The second point about cross border, although we had a lot of challenges last year, it grew 200%, so that was a Good performance. It was a great focus on sorting in terms of our Customers value proposal, what they couldn't be done was keeping delivery Times, it's usually a 40 day period, it's too long. So we started B2W delivery And as a result, we reduced these delivery terms by half, so rather than 40, 20 days and this It's really fast for this segment and the focus will continue to decreasing Delivery times, cross border has a great advantage, unlimited assortment of special products. So whenever we have new products, there's very good acceptance. We saw that on Black Friday, but also on Sines Day, November 11, and then there's another operation. That's another focus. I mean we provide everything anytime, anywhere. So Cross Border helps us We have now closed the Q and A session. I'd now like to turn it over to Mr. Lapages for his final remarks. Thank you everyone for participating in our earnings release. If you have additional questions, Our Investor Relations team is at your disposal. Thank you very much. Have a great afternoon. B2W's conference call