Earnings Call: Q1 2019

May 10, 2019

Good afternoon, and thank you for standing by. Welcome to the B2W Digital Company Conference Call to discuss results regarding the Q1 of 2019. Here today with us, Mr. Haouni Laffajes, responsible for Investor Relations with B2W and Mr. Carlos Padilla, CFO and Investor Relations Officer with Roger de Maria Canemas. For the better follow-up of the conference call, we suggest using the supporting presentation that is available at ri.b2w.digital. Please be informed that this event is being recorded and that all participants will be in the listen only mode during this conference call. During this conference call. Good afternoon, ladies and Good afternoon, ladies and gentlemen. Thank you for attending our conference call. First, I'd like to to introduce myself. I'm going to represent the company in this conference call. My name is Raoni Lafargeosi, and I'm going to replace Fabiola Brasi, who will not attend the conference for personal reasons. Before the comments on the results of the Q1, I would like to start the presentation. I would like to noting that 2019 will mark the conclusion of the 3 year strategic plan, 2017, 2018 and 2019. Investments made in the last years in logistics, technology and customer service to meet the challenges of e commerce in Brazil enabled us to accelerate the hybrid digital platform models, combining 1P, 3P and services with the continued growth of the marketplace and consistent evolution in cash generation. The structured digital platform always focused on the customer prepare the company for a new phase of growth, profitability and value generation. On Slide 3, we highlight the T2W digital platform whose purpose is to connect people, businesses, products and services. The combination of the most beloved brands of the Brazilian Internet with proprietary vertical elements of technology, logistics, payments and financial services creates a virtuous cycle. The strong traffic of our brands is highly attractive to the sellers, contributing to the expansion of the assortments in our sites attracting more and more customers. On Slide 4, we present some of the main indicators of B2W platform. The traffic of our sites continues to grow and reached a total of EUR 2,300,000,000 visits in the time frame of the last 12 months. Our active customer base is 15,000,000. We reached 35,000,000 downloads with 11,000,000 active users in the monthly active users, the MAU. The B2W marketplace reached 25 point 5 connected sellers in March 2019, which contributed to the strong expansion of our assortment, which reached 9,100,000 items at the end of the quarter. And the most relevant of all is our total focus on the customer, which recognizes us as year after year the best shopping site on the Brazilian Internet. Americanans.com features NPS of 8.4, the best in the major operations categories. In addition, our brands have the RA1000 CEO of Excellence in customer service. Turning to Slide 5, We highlight the top priorities for 2019: accelerated marketplace growth consolidation of our leadership in mobile platforms, increasing engagements and lifetime value of the customer Acceleration of the O2O online to offline, bringing us closer to the customer, allowing them to buy what they want, when, where and how they want. Ever faster deliveries, revolution the way people interact with money through AME only, offering the best shopping experience. We therefore, we stress our objective to grow towards the market and achieve positive cash generation in 2019. On Slide 7, we will discuss the Q1 results. Total GMV reached BRL 3,600,000,000 BRL with growth of 15.3% versus 12.9% of the market. This result is in line with the expected growth for the year. It's important to note that in 1 piece, we had a period of adjustments after the end of the tax incentive law for companies that invest in innovation. At that time, we tried to strike the best balance to keep competitive offers to customers without compromising the profitability of the operation. Excluding the effect of that law, the growth of total GMV would have been 25% in the Q1 2019 after the adjustment period. Throughout the year, we will have a gradual recovery of 1P, which added to the strong growth of 3P, will result in the acceleration of total GMV. The marketplace is fast developing, with GMV reaching BRL 2,200,000,000, growing 52.2%. Participation of 3P, total was 61.2%, a new record. Throughout the Q1 2019, 3,600 new sellers were connected, a total of 25.5 1,000 sellers on the platform. Bicuw Entrega or delivery connected 4,000 new sellers and closed the quarter serving 22,500 sellers, which represents 88.2% of the total base. Now turning to Slide 8, we'll comment on the evolution in cash generation. In the Q1 2019, cash consumption was BRL 385,200,000, a reduction of BRL92.3 million versus the Q1 2018. This result was in line with the expected curve, demonstrating that we are on the right track to achieve positive cash generation for the year. On Slide 9, we highlight the marketplace evolution that recorded a GMV of BRL 8 point 5,000,000,000 in the last 12 months, growing 63.3%. The strong performance of the marketplace is a result of the combined work of B2W and sellers to offer the best value proposition to customers. From the outset, in 2014, the B2W marketplace operates with open APIs, allowing for fast and effective integration with leading platforms and ERPs on the market. Through APIs, sellers simplify the management of key business, variables, product pricing, inventory and freight and manage multichannel management sales in the marketplace and in their own stores. Currently, more than EUR 120,000,000 orders are placed a day. In addition to the B2W continues to support sellers so that they can grow in a sustainable manner within the platform, encouraging entrepreneurship and also enabling the emergence of new businesses business. Now we will discuss the operational highlights of the quarter, beginning with Slide 11, where we highlight the growth of the B2W standard base. Since the beginning of the operation at the end of 2014, the BTW marketplace has connected more than 25,500 sellers. This rapid evolution reflects the high level of attractiveness of our digital platform. By 2019, we have strengthened our intention to reach more than 40,000 sellers. However, we remain strict in selecting who sells on our platform. The reputation and quality of our partners are important evaluation factors and are aligned with our goal of creating the best market place in Brazil. Therefore, BTW Marketplace brings together the best sellers of the market in a reliable platform where customers can buy their products knowing their origin and quality. In Slide 12, we highlight the evolution of the assortment. Over the last 4 years, we have observed an exponential growth in the assortment of products offered to customers from 1,100,000 SKUs in the Q1 of 2015 to 9,100,000 SKUs in the Q1 of 2019. The expansion of assortment is a fundamental pillar of our value generation cycle and consolidates the perception that in our brands, customers can buy anything. By 2019, we want to reach 20,000,000 SKUs. In line with this strategy, on Slide 13, we highlight the development of America Zmundo, the B2W's cross border operation, which allows customers to purchase products from anywhere in the world. Launched in March 2019, the operation continues to develop rapidly and already has an assortment of more than 410,000 SKUs. The operation also allows BTW to enter asset light and in a competitive way that is without any heavy stock into new product categories providing a differentiated assortment for our customers. Cross border is also an opportunity to offer lower average ticket items, generating more transactions and increasing purchase frequency. On Slide 14, we highlight the important O2O initiatives of Los Azamericanas and V2W, which have been enhancing the customer buying experience with increasingly representative results. The physical and online experience allows us to offer the best of both worlds. Over the past 12 months, more than 1,500,000 customers have made purchases through these initiatives. The Click and Collect operation today is already available in 12 50 stores of Lardos Americanas in all states of Brazil. We have also started a pilot project with pickup point at 8 BTW marketplace sellers physical stores. The Click and Collect Now operation makes it possible to collect products from the store within 1 hour after the online purchase and is already available in all 1500 Americana stores. Project Americanas have also been expanding their operations as seller in the BTW marketplace. In March 2019, we have registered order from customers in more than 3,500 municipalities, having the capacity to increase the capillarity of the stores present in 603 cities today. Also in March 2019, Las Matasamerica del Bicuw launched the Laza Entrega pilot plan, enabling customers to purchase products from the nearest Laza physical store online and receive their purchases at their addresses within 2 hours. On May 2019, the pilot that was only initially available in Sao Paulo has also will also be extended to stores in Rio de Janeiro. On Slide 15, we will comment on the evolution of P2W delivery, a platform that operates and controls marketplace delivery. The service was launched in March 2017, and it already has 22,500 connected sellers, representing 88.2% of the total base. B2W deliveries operated by Lexx, a shared management platform for logistics and distribution assets of Laza and B2W. Laza is also responsible for the operation of the fast delivery program, which has delivery times for BTW. Currently, 50% of all platform deliveries are already delivered within 2 days. In the states of Sao Paulo and Rio de Janeiro, this indicator already reached 70% of deliveries. On Slide 16, we highlight that BTW continues to be recognized for the best customer service at the Klamakija complaint website. We continue to show the best evaluation. BTW's 1P has an average rating of 8.3, while the competition has agreed of 7.3 in complaints. In the 3P, B2W has an average score of 7.3, while the competition has an average score of 6.2. In addition, in order to be closer to our customers, in May 2018, we launched a new relationship channel through WhatsApp, promoting an innovative and even more friendly communication system with our customers. Currently, 53% of orders already can be tracked using this tool. And every month, 4,500,000 messages are sent with information about the orders. Turning to Slide 17. We highlight the rapid expansion of Ermi. Ermi is one of the first IF initiatives that has come to revolutionize the way people deal with money. With just 11 months of operation, the number of downloaded Navami apps totals 2,100,000, and customers can now pay for their purchases with the app on all V2W sites. In addition, Los Gatos Americanas continues to invest in proper tire technology to increase acceptance and involve and evolve this customer shopping experience with Amistore. So Ami's acceptance has increased in a short period of time from 6 pilot stores at the end of October 2018 to 6 50 stores today. And we are also developing features that are unique to the physical world, Trascacia in Las in March 2019. Throughout 2019, Ami will be present in all physical stores of Los Osamericanas and also in other physical stores. Now turning to Slide 18. We highlight the new features and products of Hermes that have been released in May 2019, of which we highlighted: cash in with a slip payment slip interactive map with the location of the commercial establishments that accept AMI Elegisa portal, which allows the establishments to that accept AMI to manage all the information about its sales and personal credit at Ami that allows the client to contract loans through the app in a simple, fast and 100% digital form. The contracted amount is credited directly to the Ami account. In 2019, as part of its business plan, AMI will have an incredible roadmap of news, making an important contribution to the future of Los dosamericana del B2W. Finally, I would like to take this opportunity to thank our team for their enthusiasm and dedication. I would also like to thank our suppliers for the partnership, the marketplace vendors for choosing our platform, our shareholders for trusting us and above all, our customers for their preference. These were the main comments regarding our performance in the Q1 of 2019. Now I would like to open the Q and A session to clarify any questions you may have. Ladies and gentlemen, we can now begin the question and answer session. Our first question comes from Mr. Luis Canai from BTG Pactual. Good morning, everyone. I have two questions. The first is, could you make some comments on the evolution of GMV, especially for 1P? How what can we expect for the semesters to come? And how can we mitigate the effect of that tax incentive law? And still related to the second question, could you provide further details about AMI road map? And what are the discussions for the equity structure? What can we expect for the future? Hi, Luis. Good afternoon. Thank you very much for your question and for attending our conference call. In relation to the first question related to GMV, I think it's important to say that we are very confident. We believe we're going to continue growing twice as of the size of the market. And when we look at this growth, it's important to understand the moving parts. We have the operations of 1P and 3P. So our operation is hybrid. 3P is an operation which is not so much concentrated. We have EUR 9,100,000 of SKUs in the assortment of the company, out of which EUR 8,000,000 come from the marketplace. So 3P has this characteristic of not being so concentrated and offering a larger assortment to the client. When we look at the 3P operations, we see that we grew by 52% this quarter. And we see that this pace is going to continue along the year. When we look at 1P operation specifically, we can see that the quarter was quite different. On January 1, we had the end of that law of tax incentive. And so we had a decision focused on cash generation and value generation strategy to strike a balance. So we are going to we want to grow and gain market share above that of the market. But we at the same time, we'll generate cash and expand the market. And when we look at the Q1, considering the scenario after the loss was over, we saw that the performance of the company was very positive. We grew 15.3% versus 12.9%. That was the growth of the market. We expanded 4.8% in the gross margin, reaching 31.8%. And in cash burn or cash consumption, by the way, the Q1 has pressure on the cash typically. But even so, our evolution was quite positive with the consumption at about BRL300 1,000,000. So we've been after this balance, considering all the variables. And it's also important to stress that when we exclude the effect of the law of the fact that our growth would have grown at a level that would be enough for us to grow twice the market. But so we believe that we are going to be able to deliver the growth estimated for 2019. And Luis, it's also important to understand the curve. Throughout the time, at first, we have to consider the end of the law requiring adjustments to the prices so that we can preserve the profitability of the company. And we are going to see that the market will make its proper adjustments. And at the same time, new products will be launched and the prices do not need any adjustments. So we had some launches in the Q1. For example, yesterday, we launched the Samsung M10. And I would also like to congratulate our commercial team because we are the exclusive distributors. For 24 hours, we were able to launch the product exclusively. There was a target that we agreed with a supplier to sell a certain number of products, and we were able to reach that target in 6 hours. So gradually, this is going to make its own adjustments. And we again are very confident that we are going to continue to grow as expected for the year. In relation to your second question related to AME, AME, the first point for us to consider is that Ermi is an initiative of IF. It was one of the first initiatives of IF, which is Innovation and Future. And as you all know, has the mission of building disruptive businesses. And Ermi was born as an operation that has a combination of Los Azamericanas and B2W. And these companies have been investing in their provide the synergy synergistic platform. But we understand that for the clients, the best thing to gain value is to do things combined. So B2W and Los Altosamericanas are investing together on the platform, and they are making all the necessary adjustments so that Ermi can continue growing at a very fast rate. So it's important to say that when you look at the combination of stores and BTW, we can see that internally, we have competences that we are not found in the market. BCHW has the most beloved brands in the market. The Los Osos Americas has a fantastic popularity of 1500 stores throughout the Brazilian territory. Our client base is very diverse, very rich. So the idea is to add all those competencies to the favor of Ermi. And obviously, when we do that, we will generate value to the clients and to the shareholders of both companies. So we are about to complete the structuring of Ermi as a business. Ermi is a service, is a product that's present. So we are about to complete the Mini as a business. And each company will have its share depending on how much value it's been adding to the operation. As soon as this business structure is completed, we are going to announce this to the market. Thank you, Johnny, for your answers. Thank you, Luis, for your questions. Our next question comes from Mr. Joseph Giordano, JPMorgan. Hello. Good morning, everyone. I have some questions related to the multichannel integration for the group. The first question is to understand the progress, the status of the pilot of the Pick and Collect involved in the seller. I would like to understand that in addition to the Pick and Collect operation, could we consider adding general merchandise of the company as a whole and therefore expanding the multichannel point of the company? The second question also related to integration about Ermi. We have the automatic terminal that was created by Los Americana that is powered by EMEA. I would like to understand what is the rollout status of this initiative for the retailers that can add to their adherence to the initiative. Joseph, good afternoon. Thank you very much for taking part in this call. Entering your first question related to the integrations of B2W with stores and what we have been referring to as O2O, online to offline. We have some highlights to share with you. First of all, we have to understand that this is an integrated view of the businesses combining the best of both worlds. As I said in the previous answer, we have a single initiative when we consider the stores and the B2W considering the structure and the capillarity. And by means of this O2O approach, combined with this shared vision, we can sell different products to different clients by means of different channels. We do not have to prioritize one to the other. We can grow all the businesses in a combined manner. The most important of this integrated view is that the client has the freedom to purchase what he wants, when he wants, how he wants. At the end of the day, the client is single, and we have to be prepared to meet the requirements of the client. And this is the purpose of our initiative. As you said, one of our initiatives is the one you've commented on, But I'm going to mention other operations of O2O that are also progressing very quickly. The first one is the kiosks. And in Americanalogies, we have kiosks. And the importance of kiosk is the idea of finite shelf, infinite shelves. So the client is able to purchase anything, not only the items available at the stores for immediate consumption. So as to say, you can purchase 60,000 items on the spot or the person also has the option of purchasing the other products by means of the kiosk. This is the infinite shelf, a concept that gives complement to the assortment of products. In relation to O2O, we have the seller and the marketplace, and we want to increase the capillarity of Las Americanas. Las Americanas has a fantastic capillarity with 1500 stores throughout the country, but it cannot be present physically in all cities. And by B2W with the sellers of B2W, it has been able to expand its reach. So as we shared with you during the presentation last quarter, we sold items to 3,500 cities, more than 6 times of the number of the cities where we have a physical store. Now move to another store. We have the other operations called Click and Collect. So the customer purchases online and can pick up that item at the most convenience store. This is another example of the benefit of the capillary of the wide network of Los Osamericanas. It is present in all states in 1500 Lodgesamericana stores so that you can see the speed. In the Q1 of the previous year, we were present only in 400 stores. But today, we are already present in 12.50 stores. And in the Q1 of 2019, we have announced another pilot project that also offers at stores sellers of our marketplace as pickup points. With that, we can provide customers with more options of locations for customers to pick up the product. Another important point I'd like to share with you is a variation of click and collect. We call it pickup at the store today. So the customer purchases online, an item of that is in the stock of that store, and the client can pick up that product at that store within 1 hour. That's the model that is present in all 1501 stores of Los Americanas. We believe there is a high potential for that model because you can pick up that item within 1 hour, immediate availability, no freight costs. This is a model that's very likely to increase. And finally, we have a pilot project for the Plaza Entreza. So the customer purchases online an item that is part of the store's stock. But instead of going to the store and pick it up, we send that product from the store to the customer's house within 2 hours. So we need to have that stock closed to the customers. It's closed to the store so that the delivery can be done very quickly and the freight cost is optimized. This service was initially available in the city of Sao Paulo, but now it has been expanded to Rio de Janeiro. So Joseph, I just mentioned some initiatives related to your question. And I can tell you that results are very promising. We have observed an increase in purchase frequency. There is an increase in flow both offline and online and offline. We can expand the delivery area. You can optimize freight. Or if the customer picks up the product at the store, there's no freight. And when you combine all these platforms and services together, this has accounted for more than 1,500,000 customers that have used these convenient services in the past months using this integrated approach. Now moving to your the second point of your question relating to the road map of Digital AAM. We have been expediting our efforts. This initiative started less than a year ago in June. We have already reached more than 2.1 downloads of the app. It has gained leverage and also new functionalities and products very quickly. Indeed, what we've been doing at AMED Roadmap has to do with our vision of being an ecosystem with full financial services and payment. Let me remind you what we've done so far, and I'm also going to tell you what we plan to do for the future regarding AMET's road map. At AMEToday, you can use this app to pay for all brands of BTW. You can also use the app to pay in 6 57 stores of Los Angeles Americanas in AME transactions. Cash back is a very important driver. That's a benefit to customers, and that's one way of those companies optimizing their offers. It's a win win approach. We also allow our customers to cash in using credit card and to get transfers from other AMI users and also transfer money to other AMI users. In the beginning of this year, we launched an option to pay store owners, so not only using I mean, B2W, but also to other sellers online around the world. And we have recently launched cash in through your current account. So instead of transferring money from your cash account and from your bank to Hermes. And also, cash in Glaza, so you can deposit money using the point of sales of the store and also recharging your cell phone with more credit. So you have a lot of functionality and a lot of features available to all MA users. We have also launched other features in a beta version. It is being observed by a SaaS group, and over time, it will be rolled out. So payment of bps of bank slip using MA. You can also cash out EMA to your bank cash account, so sending money from your digital account to your bank account and Omni Plus, which is a profile avenue for small merchants so that they can process payments using the app too. And we have also announced in the Q1 personal loans, personal credit options, so that customers can take a loan through a direct deposit on their AMI account. It's fully digital and very quick. And that helps us focus into the future. We believe that we'll find new features that will turn ME into a complete ecosystem for financial payments. So until the half of this year, we will have the scope of MA plus because MA plus is based on the fact that we contact the owners, the store owners so that they can join us. But we will go into open seats, so to speak, so that anyone can connect to it. And in this period, we're also going to make available cash out at Laza. So customers can go to the point of the PDV to the terminal of the store to take money as if it were an ATM. So with that, we're going to expedite the integration of Ami with other platforms. We also have another vision connecting that with mass transportation options such as buses, the metro system and also individual transportation systems such as taxis and similar apps. With that, we can increase the daily use of the AMET system by customers. So if customers can pay for their bus fare, for example, can use the AMI system twice a day, that will increase customers' engagement with the AMI app. There are several roadmaps and features that we plan to implement in the future. Let me say that the road map for the future is going to be leveraged and expedited. And Los Altosamericanas and BTW will make an effort to offer the best of the company so that this growth can be accelerated. I'd just like a follow-up related to Click and Collect. Could you tell me about the size of the assortment that is available to Click and Collect in Click and Collect now? Click and Collect now is based on the store inventory. So you can buy it online. And if it's available on inventory, the customer will pick it up. So it's an immediate availability. The click and collection when you go and pick up at the store, we'll send the product to the store and the customer picks it up there. So it's the full assortment of 1P and the assortment of 3P that is connected to W Entrega, the delivery system. So once it is connected, it's the same level of service we have for 1P. 88% of sellers are connected to B2W Entrega System. Thank you, Our next question comes from Julia Fan from Itau. Good afternoon, everyone. Good afternoon, Haeni. You said that there's going to be some improvement due to the sale of cell phones. But on the supplier side, how have they behaved in the past? Are they taking part in any investments in terms of price as a reaction to the incentives law? Another question related to earnings associated with the guideline that was issued by the Central Bank of Open Banking. What were you caused by surprise? Was there anything additional in terms of preparation since you launched this initiative of personal credit? Maybe this can be a segment that has more upside maybe? Hi, Julia. Good afternoon. Thank you very much In relation to your first question, that is the co participation in the law of goods, Nobody wants to pay this bill. And we have to find the best for our customers. So it's not true that the suppliers are willing to pay for that. With the law of goods, we had a period of adjustment. At first, some companies would hold back and some of them needed to pass through the amount because this is our strategy. And then we saw that the market adjusted by itself because there's no way we can hold all the effect by yourself. So what we have been observing along the half of the year is new launches. So there has been an acceleration in the new launches, and they help us apply or use new prices and therefore minimize the impact. The reaction of the supplier is always of a partnership. So all we want to sell more and sell better. So we are always trying to optimize this. I mentioned a very interesting partnership that we had with Samsung. So we want to get closer to the supplier as partners and try to accommodate and share the effects of such as that law. So we managed to make adjustments to this. And therefore, we grew. We had an evolution in the margin. And we also had an evolution in the cash flow. And during the year, as this transitional effect wears off, we are going to have natural adjustment of the IP and the behavior of GMV. So we will continue to grow in the market. In relation to your second question, I would like to clarify something about this personal credit. So this is an initiative that was established with a partner. So we have a partner who is going to loan this credit. So there is not going to be any impact related to the regulations of the Central Bank. So this money is going to be invested in our platform. And I have this financial service that may be capitalized to other services. Okay, perfect. Could you provide more clarifications about this partner? Is there any exclusive basis when you established this partnership? Yes. It's a division of the financial market place. There is no reason why we should have an exclusivity. We are going to welcome new partners, provided they can offer better conditions. This was the first partners that we had, but we can bring other partners that can offer different financial products as well. Okay, that's very clear. Thank you very much. Our next question comes from Mr. Pedro Fagundes, Bradesco Bibi. Good afternoon, everyone. I have a question in relation to the increase in the number of SKUs. Could you provide some more details in relation to this? If there is any specific category that you're going to focus on, if this is going to increase your relevance? And 2, about this topic, do you believe that the platform is ready to gain relevance in any of those projects which has specific experience, such as clothing. Hi, Steve. Good afternoon. Thank you for your question and for your participation in the conference call. In relation to assortments, as you said, we have been expanding quite quickly. As you saw in our presentation, we have 9,100,000 SKUs and 8,800,000 in 1p. So the marketplace allows us to have an accelerated expansion of the assortment of the company. So the idea is to offer everything to the client so that the client can see its wishes. So the marketplace helped us a lot in this growth. Important point is that the growth of our marketplace, because it's an asset light, I do not have to have heavy stocks. And this is one way to accelerate its margin. And therefore, we have been sharing with you already what our objective is for the year. So we have a target to reach 20,000 SKUs up to the end of the year. Today, we stand at 9,100,000. We are going to move very fast in this direction, bringing in new sellers and helping the sellers who are already working with us so that they can grow with us with the platform. And above all, when we look at the expansion of assortment, we have announced along this year that we are going to enter the business of cross border. So cross border has this vision of offering differentiated product to our clients, offering items that we did not have available on our website in order to expand the assortment. And regardless whether the seller is in Brazil or in the United States or in China, the idea is to provide a broader assortment to our clients. So everything we do has the focus of providing better services and products to our clients. And in this cross border operation that we started in March, and in a very short while, we have scaled quite a lot. We have more than 4,000 items only across 400,000 only across the border. Today, we work with 1P at the rate of 300,000 items. So we can see how fast we moved, and we are likely to move even faster within this cross border operation. And in Brazil, it involves BRL 12,000,000,000. And this amount is not included in the BRL 60,000,000,000 accounts that we mentioned when we mentioned the e commerce that we usually use as a reference. It's a market that historically is dominated by international players, the local player that provides stronger movement in this operation for this type of market products and this type of operation. And Pietro, we have some very interesting advantages in the cross border operation, considering the clients. So I can offer, as I said before, a differentiated assortment, lower average ticket, and it has the service provided by medicremas.com. We understand that it's going to be well assisted. And we can also offer the possibility of paying installments. So we understand that the e commerce clients are very interested in installment. So they can purchase imported items in installments. So this is our view. And in fact, the cross border, when we consider Brazil, it's one of the main categories. It's fashionable. And it's in clothing and fashion. We can work on an asset like basis. And our structure is very well structured, and the strategy will meet this challenge. So provide service to the clients in the most asset light manner as possible. And we are going to provide an ever broader assortment to the client in a nonstop shop. Perfect, Roni. Thank you. Thank you. We have now closed the Q and A session. I would like to turn over to Mr. Haeni Lapazazzi. You may proceed, sir. I would like to thank you for your participation in our teleconference. And I would like to invite you to check the best offers at americanasconco.com, Submarin, the Shop Time in Subaraka. And also, I'd like to wish you a very nice Mother's Day that we are celebrating next Sunday. If you have any questions, our Investor Relations team is at your disposal. Thank you, and good afternoon. The PGW conference call has ended. Thank you very much, and thank you for using our conference call. Good afternoon.