Earnings Call: Q1 2023

May 10, 2023

Summary

Shopping Brazil improved margins and take rate despite lower revenue, while cost controls supported adjusted EBITDA of BRL 7.6m. The BV partnership and Bankly sale are central to the shift toward asset-light operations and future growth.

Good afternoon, and thank you for standing by. Welcome to Méliuz webinar to discuss the results for first quarter of 2023. My name is Giovana Villari. I work in Méliuz's ops team, and I will host this event. Our conference will be held in Portuguese and translated into English simultaneously. Just select the preferred language on the interpretation button located at the bottom of the screen. Again, for non-Portuguese speaker audience, let me inform you that this event is being translated simultaneously into English. Please select the preferred language by clicking on the interpretation button, which is located at the bottom of the screen. With us here today, we have Israel Salmen, founder and CEO of Méliuz. Gabriel Loures, growth director. André Amaral, director of strategy and shopping and data. Márcio Loures Penna, Méliuz investor relations head. Before turning the floor over to Israel, I would like to inform you that this event is being recorded, and at this moment, all participants will be in listen-only mode. Then we will start the Q&A session. To ask a question, just click on the raise hand icon on Zoom. The materials presented are available for download on our website, ri.meliuz.com.br in the results center session. Over to you, Israel. Thank you, Joju. Good afternoon, everyone. It's a pleasure to be here speaking to you. I make it a point to bring our team, all the management team that are involved in the great missions that we have for the year ahead of us. And I'm very happy with the performance of our team. We started the year with some sad news. Unfortunately, we had to reduce our team. People who we like, people who had a very good relationship with the rest of the team, and somehow this can impact our team, we get a bit upset. But the team is very engaged in the mission. What I saw our team doing in the three or four first months of the year made me very proud. At the moment when we're changing ways, we starting an agreement with Banco BV. And I see that the team is very engaged. I have the feeling that they have control over what's happening. I trust. And we are going to focus on the company that you saw at IPO. They were generating cash with a positive margin and generating growth. This is no news for us. We've done this a number of times last year when Méliuz had hardly received any investments, and then we received some investments from the IPO, made us go back to the trajectory that's demanded by the moment. So we are ever more aware of the costs and expenses related to the operation, and we are also optimizing revenues and some lines of businesses with growth, and also involved in the growth of subsidiaries. I feel that the team is very engaged with our purpose. And the results that we are going to show you will make you understand what the new value is. After the agreement with the Banco BV, after the sale of Bankly, and with the leaner team so that we can proceed with the next steps. And then I will be available for the Q&A session. The presentation will be coordinated by Gabriel and Márcio, so I turn the floor to them. I'll be back to talk to you again. Thank you, Israel. Good afternoon, everyone. My name is Gabriel. I'm going to go over our results. I'm the Growth Director. I'm going to talk about Shopping Brazil, this vertical, as well as international shopping. I'll bring more details about our partnership with BV and also discuss our vertical of financial services. As you know, we made a sales agreement with BV in December 2022. In the agreement, we set forth a partnership with a bank to offer a portfolio of financial services and products launched on the Méliuz app. This is in an asset-light model, where Banco BV will compensate for the activation of those products. It also brings in all the expertise that the bank has in offering those products to the client. Fraud prevention and other topics are brought with the expertise of BV. During this period, we started development in January. In the beginning of March, we had a pilot project running for employees of Méliuz and BV. After April 12, we opened the first current account and the first card for the final user. We are very happy with the speed that we exerted in this offer. This was partially possible because we use the same structure of banking as a service, that is Bankly, that we use for the cards and for our account. We have a multidisciplinary team across the company, Bankly, Méliuz, BV, working in the offer of those products so that we can scale up the volume of the opening of those accounts and cards so that we can do this in a progressive manner in months to come. We cannot see the results in the P&L of Méliuz yet. Marcel will provide more details about it shortly for two reasons. First, the volume in the first quarter was negligent. The costs are also reflected in the P&L in part of the first quarter. It started to be passed through as of the second fortnight of March. We are going to show you a little bit how this is materialized in our P&L. We are accomplishing our mission, which is to scale up our offer of products and offer financial services included in our purchase experience. We create a Méliuz experience, a unique experience to the user, regardless of if they open a Méliuz or a BV account. This will ensure the partnership in the long term. As next steps, we are also going to launch new financial products according to the financial agreement we executed, both related to insurance, credit, and other products that are on the roadmap of the partnership. All the technical team is working on this. In addition, we also have some formal items in order to formalize the agreement with Banco BV. Marcel will also be providing more details about it. Now about the vertical shopping. We have the focus in optimizing the margin. We showed once again, a quarter with a growth in our net take rate. In the first quarter of 2022, we reached a net rate of 2%, and now we've reached 2.2%. This reinforces our positioning of Méliuz in front of our partners. In spite of the challenging moment we are facing, we can prove month after month that the amounts will have a return, and Méliuz continues to be a very strategic channel for those partners. This can be seen in the higher volume of campaigns for our users. Our users can see new opportunities to get cashback, and it also reflects the commissioning plan of Méliuz that is reflected in the net take rate. Together with that, on our side, we work to ensure intelligence in the segmentation and the offer of cashback to ensure that our cashback strategy will generate value to the user. But at the same time, we reduce the cost that it has in our P&L in a segmented and a smart way. We do hundreds of tests in order to ensure with proper metrics, showing that we are delivering cashback in the optimal manner. At the same time that we are working to improve the net take rate, we also see that we have reduced the marketing expenses when compared to the same period of last year. With a drop of 42%, this is only possible because Méliuz has some groups which are retained, and month after month we continue purchasing more and more. We manage to ensure we are able to ensure a healthy behavior of our purchases, and we retain the purchases that we have. We grasp the reins and make all the adjustments of investments, also monitoring the higher interest rates, and we also increase our return target and reducing the payback time expected from the campaigns. With this, we can maintain our business in a healthy way at the same time that we resume marketing investment and bringing more results to our system. This slide reflects the evolution of our model and the win-win model that we have for Méliuz. We have been managing to deliver more campaigns together with our partners, more opportunities for them to generate efficient sales, more opportunities for our users to gain cashback, and at the same time, a healthier margin for the business. This is reflected in our financial results. In spite of the 42% reduction that I mentioned before, our revenue dropped only 11% year on year comparing the two first quarters of those years. This is reflected in our effort in our other business lines that generate incremental results for Méliuz and also ensures for our partners exposure in all our channels of communication. As I said, our cashback expenses had a drop, 27% in terms of cashback related expenses, and the consequence is a healthier margin in our Shopping Brazil business with a growth of 32%, as we can see on the right. Year on year from BRL 19.9 million to a margin of BRL 26.5 million in the first quarter of 2023. We are enforcing that we can generate value to our users, but we can also make it profitable, though with better cashback businesses and better management of our business. I would now like to talk about the international shopping business with Picodi. A big milestone was reached. 2 million accounts were opened since the cashback operation was launched. As we mentioned in the last release of results, Picodi reached those results much quicker than Méliuz. In spite of operating in less than two years, we have already reached. With Méliuz, we took over five years. The result is a very high level of buyers in comparison to the first quarter of 2022. We can see this great increase. This is reflected in the operating numbers. GMV of the company grew by 400%, and net income and cashback operation also grew in line with the 400%. Cashback operation now accounts for 38% of net income, total of Picodi against 26% of the fourth quarter of 2022, showing the efficiency of our strategy. We replaced the legacy business with a cashback business that is very successful, and our expectation that it will bring in more users that will continue purchasing with Picodi, allowing us to grow the business exponentially as we did with Méliuz when we were generating ever more results and more GMV. In relation to operating results and revenues, this is what I have to say. I would like to turn the floor over to Márcio, who will talk more about the financial aspects. Thank you, Gabriel. Good afternoon, everyone. It's a pleasure to be here with you once again. Next slide. More important than speaking about the costs and expenses that were reduced along the quarter, better yet is to show that the company is making a long-term effort. We've been doing this for one year of reducing all those costs as a whole so that we can have a more asset-light structure. We review the first quarter, and we have a pro forma release when we see the cost structure that it can be sustainable for the quarters to come. We can see the variation here. We have a robust reduction in terms of expenses and costs in all lines related to expenses, especially headcounts, personnel, as was mentioned in the beginning of our presentation. At the end of the period, excluding Bankly, which is about to be sold, and extraordinary items, namely those which are not recurrent in the balance sheet. Excluding those, we get to a level of expenses which is much below of what we had at the end of the fourth quarter of 2022. The last column, green, shows the expenses that were excluded after the commercial agreement that we signed with Banco BV. This amount of BRL 5.5 billion shows as if it had happened in the quarter as a whole. We did this because you can understand what would be our cost study from today on. We have recurring operating expenses because we believe that this is what Méliuz can deliver in the next quarter in terms of expenses and costs. We see upside in the sense we believe we can have further reduction, and we are working hard on this, and this is everybody's goals inside Méliuz. We are negotiating with suppliers, we are making operational improvements. We are maximizing the margins of the products that are delivered in order to reduce operating expenses even further in a sustainable and longstanding manner for the quarters to come. Moving on to the next slide. Here, we show how this would impact the bottom line of the company. Again, excluding the Bankly, which is about to be sold to Banco BV. So we come from a consolidated EBITDA negative 13.1, excluding the extraordinary items, which are non-recurring, as we mentioned in the report, with the provision of Americanas and the costs of termination of agreement, court fees, because of related to BV, BRL 600 million. So we get to adjusted EBITDA of 7.6 million in the period. So bringing into a more long-lasting structure that we can deliver downwards, excluding the expenses that after the sales agreement that I mentioned in the previous slide, we reached to a recurring result of 5.5 million. We are working hard in order to generate cash for this year, operating cash for this year, and improve the results of the company period over period, but we deliver a very good improvement in comparison to the previous quarters. Considering the cash level, which is very robust, the financial result is very positive of 13.8 and excluding some other expenses related to amortization of 0.7 million, we get to a recurring net result of 7.6 million. This is a result, as I said, more important than the result of the first quarter. We can see this as a new company, an asset-light company that is going to be operated from now on. So we have more upside to generating more revenues. We still not have the revenue from the agreement with the Banco BV, and this is something that will just start materializing as of the second quarter. Next slide, please. As we have done in the past quarters, we show a little bit of what's been happening with our sales partnership with Banco BV. This first quarter of 2023 was very important because we had one approval of the bylaws, and we had the election of a new member that is integrating the board to help us in the evolution of the company. We started the offer of financial products, of accounts and cards, and acquisition of the minority share of 3.85% of Méliuz with Banco BV. What are the next steps? As we said, we talked about the preemptive right exercise, and this is something that is already materializing, and it's going as far as May 26th. We are about to complete the signature of the SPA for the sale of 100% of the share of Bankly in a partnership with Banco BV. So we are very close to this event. Then next, the deliveries related to this. As soon as the SPA is signed and the preemptive right is completed, the transaction will have to be approved by the Central Bank of Brazil. After the approval by the Central Bank of Brazil, we're going to complete the transaction, and then we will have to wait for two years so that the preemptive right will continue for the company, and they are also allowed to offer the same terms and conditions. In this timeline related to the sales partnership with Banco BV, some weeks ago, we talked about grouping of shares and deployment of the shares. So the shares will have a new value and with different quantities and values for the shareholders. We've finished the presentation here. We can now open the Q&A session. Thank you, everyone. We are now going to start a Q&A session. To ask a question, please click the raise hand button to unmute your microphone. The first question comes from Renat with BTG Pactual. Ricardo, you can ask your question, please. Good afternoon, everyone. Congratulations on the results. I have three questions on my side. First, could you quantify the impact of Americanas, and how much of the flow of Americanas could be redirected to other partners who are operating inside the Méliuz environment? Considering that we are in the second half of the second quarter, could you provide more information on the cost adjustments made during the quarter? I would like to understand what were the measures to control costs, and what can we expect in the future, and what is there to happen? I would like to understand the details related to the cash flow. In the first quarter, we saw a drop of BRL 116 million in the cash position. There was a cash burn of BRL 24 million, excluding Bankly, as you mentioned in the release. That means that the difference of the BRL 92 million of drop is related to the lower number of clients of Bankly. If so, could you justify and explain what happened to justify that drop? I can start answering the first question, and Márcio, you can continue as well. Thank you for the question. In relation to Americanas, the market understands that this was one of the largest e-commerce players. We estimate that we are a representative snapshot of the Brazilian market. We understood also that there was a drop before the crisis. We observed some reduction, a very significant reduction, in fact, losing ground, while Méliuz has started to continue growing. The share of Americanas lost some ground during the period. The share at the end of 2022 was much lower than we saw in other moments of our history. When the crisis happened, as we saw in the beginning of the year, quickly we started adopting some strategies to direct flows to other partner e-commerces, and we were very successful in this new redirection. We measured this. We monitored this very closely in the beginning when everything was happening so that we could monitor what we were losing in terms of Americanas, and what would happen to the other related partners. What we can say here is that a large part of those sales may see them all. We saw them dropping to other partners. Of course not 100%. We still have some partners. We have some e-commerces in the same category of Americanas, which are not partners of Méliuz. So we lost some sales, but we made a lot of efforts with other partners, and that involved our sales team, and we managed to absorb a lot of the volume. What we saw in the first quarter, as Gabriel has already explained in detail in the release, they are consequence of the e-commerce trend. Also when we prioritize the campaigns with better margins, better operating margins for the company. The consequence is that there is a de-acceleration of GMV, but we increase the operating margin of this vertical. In summary, large part of the sales were successfully migrated to other partners. Americanas itself announced that their volume had a significant reduction as a whole, not only at Méliuz. Those sales continue to exist in other players, and we could do a very successful job in this regard. I can answer the question about costs, I can provide some context. Since last year, we have an operating efficiency team where we look at the costs of the company. I can say for sure that the results of cost reduction in the first quarter is not a result of the efforts made in the first quarter, but it's an effort that has been done for a long time. More specifically, talking about the cost lines and looking at Méliuz, we commented on the optimization of cashback-related costs, which are our main line of costs. We have been working a lot on reviewing suppliers and negotiating in order to understand each supplier. We have been negotiating with them all. As mentioned in the beginning of the presentation, we had a reduction of our headcount so that we could make adjustments to the new market moment, and this had an impact on the results in a positive manner. Now, looking at the partnership with Banco BV, as Márcio explained, we start to deliver some of the costs. Some of the costs are going to be assumed by Banco BV, and this will mean a reduction in the cost basis. Now a company more asset-light. This has not been seen in the first quarter totally considering that this started happening after the second half of March, but we expect that we are going to see the results in the quarters to come. Just let me add, Ricardo, thank you for the question. We can say for sure that most of the gains that are going to come from renegotiation with suppliers are not reflected in this result. They will start to be seen in the future. So low risk, we have been working on this, and most of the results are going to be seen in the next cycles. They are not irrelevant. These are costs that we consider to be very high, and I can say that we were very successful in our negotiations. Ricardo, thank you for the question. I'm going to answer your last question in relation to the difference of cash comparing the fourth quarter of 2022 and this quarter. Yes, you're right. According to the quarter results, we had the reduction of around BRL 160 million, and we have to make it clear that not everything is related to cash burn. So BRL 23 million, as we mentioned in the report, came from Méliuz cash. BRL 17 million from the parent company, payment of bonus, cash burn, and other items. The remainder, about BRL 7 million related to cash burn related to Bankly and other subsidiaries put together. Best part of this item, about BRL 90 million, they're not cash burn. So there is a counterpart. 90% of this amount is related to a project that was discontinued. Meu Acesso, My Access, which was a prepaid card product, so the balance was delivered to the client and we account for as cash. The strategy behind it is to focus on bancassurance service using the platform. The product is going to evolve along the time. The prepaid card is a product that we do not consider to have profitable margins. And the remainder, the remaining 10%, which is not related to cash burn, are cash used for the Credits to be paid related to the guarantees that we have to have in the period of the end of the year to cover factors related to credit cards of our customers. So we have this obligation to have this amount because we have more expenses in this period. So we have this provision, and if we do not use it goes back to the other line. So this is the explanation. I hope it is clear. If not, you can let me know. Yes, it is very clear. Thank you. Our next question comes from Luca Verdi with Bank of America. Luca, go ahead. Hello. Good afternoon, everyone. Thank you for answering my questions. I have two questions on my side. The first one is related to an update of what Shopping Brazil is playing out, looking at the second half of the year, and make a comparison if there is any change considering what we saw in the market in the first half of the year. And the other one is related to Bankly. You mentioned about cash burn of the subsidiary as a whole, but I would like to know how Bankly would behave if there is any adjustment and if there will be a further cash burn. And if there is any way that we can monitor this so that we can see if it is reflected in the final amount of the purchase. Thank you. I am going to answer the first question and then André will add to that. Looking into the future in terms of e-commerce, we understand it is facing a challenging period, but we are very enthusiastic about everything that we have been doing inside Méliuz in the Shopping Brazil vertical. We are growing revenues, as we mentioned in the latest release, and we have shown a lot of value to our partners. So we are doing whatever we can in order to have our partners be more exposed. And this is done via Méliuz Ads. And there are other initiatives that are done here. So we are getting closer to our users. So we are taking all the opportunities or commemorative periods, and at the same time, we create other lines so that other partners can join in. So other revenue lines we are working on. As a new partner portfolio, we are very cautious, but we are very enthusiastic. But we are enthusiastic with the possibility, not only for the second half, second quarter, but also to the rest of the year. Only to add, it is important to mention that we also have other initiatives, as many of them are being tested right now. So it is difficult to quantify to provide any guidance. We do not provide any guidance related to this, but product team is working on new solutions in the e-commerce vertical in order to solve other pains of our partners. In addition to the other ones that we already address. So this is something that we can expect along the next months. Many new products being launched. Hi, Luca. Thank you for the question. Bankly was negotiated at BRL 210 million in addition to the CDI over the period, and that would be as far as the Central Bank of Brazil approval. This is an amount which is relevant that will be approved by the Central Bank. Let's say that I will look at this as a zero priority, top priority. I am working with the Bankly team, and we are leading this front. We are very focused on this break even on Bankly. We just mentioned the break even for Méliuz. We have mentioned that some of the results are still to come. We can expect the same with Bankly. This is something that does not happen overnight. For the second quarter, we are going to continue making a lot of adjustments as we start to generate results in the second half of the year. I am personally leading this, and the Bankly team is engaging in order to reverse this result and protect what we expect in terms of EV that we negotiated with Bankly and we are about to receive. We are monitoring this very closely, and I thank you again for the question. Okay. That was very clear. Thank you for the answers. Thank you, Luca. Our next question comes from Andrew Ruben with Morgan Stanley. Andrew, go ahead. Hi. Thank you. I was hoping you could update a bit more on the Picodi, how far along you are in the shift. The cashback looked like a nice ramp of users this quarter. Then how we should think about the legacy coupon business, how that progresses over the coming quarters and years. Thank you. Thank you, Andrew. I am going to answer this question in Portuguese. Looking at Picodi, Andrew, we have made a lot of progress in the 44 countries where Picodi operates. Going back in our history, we launched the cashback first for nine countries in September 2021. Then last year, we did the rollout of this feature of cashback to all the other countries where Picodi operates. Obviously, some countries are more relevant for the final results of the company. All our strategy here of conversion of user into a cashback user is based on the power of the product that is provided by us. Because it is the user that will come back after the first purchase, and as a consequence, it generates value along the time. The coupon user is a user that comes in organically looking for better opportunities. He can go back to Picodi or not. Or maybe he will buy just once, if we can use the discount at another site. The strategy of the business is to qualify a qualified organic. Our idea is that the cashback business will continue growing and be ever more relevant considering the results of Picodi. We are going to build those groups that will generate a GMV and will pile up along the next quarters in order to increase the results of the company in an almost exponential way, just like Méliuz found since its foundation in 2011. I hope it was clear. I would also like to reinforce a point, which is very important. When we started Méliuz in 2011, for some years, we had a level of net take rate, which is half of what we see today. So we offered less cashback to the users. As a consequence, we generated fewer sales to our partners, fewer incentives for purchases. Along the time after we visited the operations of our partner shops, when we saw the affiliated networks, and also when we grew the number of users of Méliuz, our power of negotiation, our purchasing power was greater with the shopkeepers. At Picodi, something we haven't even started. So there's a big upside as we see it, because we have a stronger users base, and we are going to start knocking at the doors of our partners, more than 10,000 across the world. Also considering our partner affiliates so that we can do a work which is similar to what we did in Brazil to those net take rates. So it's a combination of cohorts using users that are accumulated, as Gabriel mentioned. But there is a lot of opportunity in terms of revenue to be gained, and we know the way since we've done that in the past. The proof is that when we look at users, as Luis mentioned, in less than 2 years, we managed to bring in an international base of users of 2 million people. We took over 5 years at Méliuz to do that. So this is a result of the knowhow we had, how to make this product work, how to relate well with the user. So we understand this commission ramp up that we received from these shops will happen at a better pace than we saw with Méliuz in the past. I can only say positive things about this operation, even though it's small. I'm very enthusiastic for its operation in the future. Great. Thank you both. Thank you. Thank you, Andrew. Our next question comes from Caio de Paula with UBS. Go ahead, Caio. Thank you, Israel, Márcio, everyone. Thank you for the possibility of asking question. I would once again go back to the adjusted number considering Méliuz alone with the negative EBITDA of BRL 1.5 million and profit of BRL 8 million. You mentioned about renegotiation with suppliers. I would like to understand a little bit more what is the potential of those negotiations. This is the first question. In addition, the second question would be what could be the other growth drivers for Méliuz in the future? I understand that GMV growth is key, but at the same time, you have focused on margin and less than on cashback. How do you see this dynamic? Can we see a moment when GMV will grow strong as in the previous quarter? Or if in the short term, we are going to see the growth going to lower cost and expenses. If you could talk about this dynamic, it would be very helpful. Thank you. Can I talk about suppliers and then you can add to what I said? As I mentioned, we have worked very hard on renegotiating with all suppliers of Méliuz. This is valid for the large and small suppliers. Of course, we are observing all the contractual periods, but we are making a lot of effort in order to find the best solutions, considering everything that we deliver to our clients and all the products that we use at Méliuz. I cannot provide an exact number in terms of expectations from suppliers because we do not provide guidance. What we see is that we are looking at all cost lines of the company, and we are having a very concentrated effort. It is not just the beginning of the work, and we hope that this review and this number and this revision of the base of customers will grow, and will bring more results. The second part of your question. Yes, I can answer that. Related to the growth guidance in the future, what we expect down the road. Caio, thank you for the question. Obviously, we understand the market shop in Brazil is cyclic. We are undergoing a moment which is more challenging than we had to face in the past. But maybe there will be a drop in the interest rate, and we may start a new better cycle for the growth of the company, for the retail sector especially, and this will drive our core business, which is the cashback. In addition to everything, which is known to everyone, there are other products that we are launching, and that is Méliuz Ads. We have been working on this project on our app. We are providing opportunities to our partners to be more exposed by various users and have a better chance to be clicked on and to sell more. We continue boosting the sales now with Méliuz Ads, and we have seen this growing in terms of percentage every quarter. As to revenues, it has 100% margin because we create this in-house work, so there is no need to hire anything external. We have the Méliuz Invoice, which is an offline product that has been growing a lot. It has already been accessed by more than 3,000 cities in Brazil, and with no advertisement, no marketing from our side. Our user using the app tries to find what is Méliuz Invoice, and they consume the product. We do a lot of tests in order to see what is the best way to offer this to the user so our partners can have more sales. Obviously, the best way to have the remuneration on the transactions. This is going to be an avenue for growth for Méliuz. In addition, we have to mention Vika G, the pathway which is not on the short term, but we expect that in the average term, it will bring robust results to the company. I would also like to remind you that Promobit and other subsidiaries have been working well, and there are companies generating cash, and we expect all of them by the end of the year, generate cash. These are opportunities that we see from a general viewpoint. Lastly, please add to what I said, we have the partnership with Banco BV. That does not involve only the current account and the card, but there are also other products that can be offered to the market in the future. These are financial products that are going to be announced to the market as of the second half of this year. Only to add some more information, one of the main growth drivers that we can expect along the next months is certainly in the vertical of financial services as a consequence of the partnership we are establishing with Banco BV. Everybody remembers the co-branded cards. We grew that project, but we understand it had some limitations in terms of revenue leverage, because we did not have any control over the project. It was just a partner. We moved on only with Bankly in the past year. As we announced before, this is no news to most of you. With the partnership with Banco BV, we can open accounts at a faster speed and be remunerated by this. Since we are also going to be generating value to BV, we are also going to use the cards and we have more control, different from what happened when we had the co-branded. As we mentioned before, in April, we started the rollout of cards considering the partnership with BV. We also have a team developing an accretive product with very positive margins. We believe that those products are going to bring good results for the next months. We have some squads dedicated to the construction of those products that in addition to the remuneration from those cards, they are also going to be drivers for the margins and for revenues to the company. Okay, thank you for the answer. It was very clear. Thank you, André, Márcio Penna, Gabriel Loures. Thank you. We now close the Q&A session. I would like to turn the floor back to Israel Salmen for his closing remarks. Thank you for everyone's presence. We continue highly engaged with our mission, focused on what we have to do, and we know exactly what we have to do up to the end of the year. I am very engaged and committed to this, and I convey all my trust to the team and my willing to make everything happen. I feel very light in the accomplishment of this mission up to the end of this year. I think we are on the right track. We will be together in the next earnings release. Thank you very much.