Earnings Call: Q2 2021

Aug 13, 2021

Good afternoon, ladies and gentlemen. Welcome to Locaweb's Second Quarter 2021 Results Conference Call. Today with us, we have Mr. Fernando Cerny, Chief Executive Officer Mr. Rafael Chaumas, Chief Financial Officer and Investor Relations Officer Igor Franco, B Online and SaaS Director and Mr. Williams Marques, Kama's Director. Today's live webcast and slide presentation may be accessed through LocalWeb's website at www.ri.locaweb.com.br. The slides of the presentation are also available for download at the webcast platform. We would like to inform you that this event is being recorded and all participants will be in a listen only mode during the company's presentation. After Luca Webb's remarks, there will be a question and answer session. At that time, further instructions will be given. Before proceeding, let me mention that forward Statements made during this conference call are based on the beliefs and assumptions of LocaWeb's management and on information currently available to the company. They involve risks and uncertainties because they relate to future events and therefore they depend on circumstances that may or may not occur. Investors should understand that conditions expressed in such forward looking statements. Now I would like to turn the conference over to Mr. Fernando Cerny to start his presentation. Mr. Sidney, you may proceed. Good afternoon to all our customers, Suppliers, employees and shareholders, it's a pleasure to be here today with you to talk about the Excellent performance that Locaweb had in quarter 2 2021. I have three highlights to share with you today. One of the most important is the strong growth of our operations when compared with the same period last year. And in 2020, we had a period of Huge growth and that's why it's such an important highlight. We had a growth of 57.1% in our consolidated net revenue year over year. And in the case of Commerce, compared with Q2 2020, which was a very strong quarter for Commerce, This growth reached 159% year over year. And when we break this number down into Subscriptions, this reflects the true increase of our customer base. We had an increase of 204.7% year over year in our subscription revenue and 134% in our ecosystem revenue. So the total Net revenue of the group in the first half of twenty twenty one is already approximately the same revenue as that For the whole year of 2019 and the commerce net revenue for the first half of twenty twenty one is already higher than the revenue for the whole year of 2020. This is certainly a spectacular performance for the group and I must thank all of our employees for these brilliant results. The EBITDA of the Commerce segment has been growing strongly and already accounts for 56% of the consolidated EBITDA. The second highlight of this quarter's earnings is that even with the reopening of the economy, We were able to maintain a very strong base of addition of new stores, and we prepared for this. We knew that the pandemic should be slowing down by now, so we expanded our customer acquisition channels. We have two examples of new channels, and these are not the only new channels, but we have influencers and the freeman model, which was adopted by DOCA. Increased investments in marketing, strengthening of our commercial teams and improvement in our processes. And process improvement here is not just a high level term. I can give you as an example, the improvements we made in our process is focusing on our customers so that they can more easily launch their stores online, so that they can better reach Their customers and activate their services faster. For example, with the onboard service, this led to a 32.7 increase percent increase in our customer base between December 2020 June 2021. It's a lot for a very short period of time and an increase of 40.7% in the addition of new stores compared with quarter 4 2020. Now on Slide number 3, we see that we had a strong growth in our TPV for the payment transactions, a 88.6% increase year over year. And we know that quarter 2 2020 was a period of very strong growth for the company. With the acquisition of Blaine, our Commerce segment has reached approximately 100,000 active paying subscribers. Another very important highlight this quarter is that all the acquired companies had excellent performance this quarter. They even showed an acceleration of their performance if compared to prior to the acquisition. So this shows that The acquisitions that we made were very assertive and that this new ecosystem is working the way we planned and this will bring even better performance in the future. We had significant advances in the agenda of acquisitions with the purchase of Bagi and Okta Desk. With the acquisition of Bagi and Okta Desk, We had an excellent performance in Beeline and SaaS with an increase in sales volumes year over year. And once again, we know that quarter to last year was a very aggressive quarter for us and also an increase in the SaaS share of the segment. And we had gains in productivity across the entire operation with reduced churn, which is already a result of this new ecosystem, which is better for retaining And also for better excellence in our customer service with the RI1000 stamp from Rick Kamiaki. Now on slide number 3, I mentioned that we had an excellent increase in our net revenue and this is very clear in this chart. You see that in quarter 2, 2020, we had already shown an increase of 70% year over year compared to quarter 2 twenty nineteen. So a huge performance gain for the company from 2019 to 2020 and now the Commerce Segment had an increase of 159 percent in its net revenue, very expressive numbers. On slide number 5, Here we talk about customer acquisition. We continue to increase our marketing efforts. We're expanding our channels, optimizing our sales channels, improving processes. And what we saw is that the addition of new stores did not slow down in the Q2 compared with the Q1 this year. And this is very important. We knew there was the market was concerned about this slowing down, but this did not happen. And quarter 2 showed an increase of 40% compared with quarter 4 last year. And our customer base or our subscriber base, better say, increased 32% compared with December 2020 showing the excellent performance of the Commerce segment. On Slide number 6, We see that we are forming the most complete commerce ecosystem in Brazil for SMEs. And further, we will continue to improve the number of integrations in our platform. We went from 4 37 integrations that we had last quarter to 483 integrations By the end of this last quarter, we continue to be an agnostic and open system. So even if we have our own ERP Solutions, we have 347 integrations with other ERP systems. We have integrations with email marketing, payment solutions and so on. And a great achievement which makes us really proud and is already yielding results is the native integration with Facebook and Instagram. It's a transparent integration into Trace Panel with product management on Facebook and Instagram, page and campaign management. You can install the new Facebook API automatically. And just to give you an idea of the results, we had more than 3 1,000 installations in just 5 days. This is to show the huge potential of social commerce. It is certainly a strong trend, and Localev has been heavily investing in this slide. Now a little bit about our recent acquisitions. So the 3 most recent acquisitions, Bling In the end of quarter 1, Bling is an online management software for micro and small businesses with a focus on e commerce. It is a SaaS based solution for physical, virtual and hybrid businesses. It is the ERP system with the greatest penetration in tray. Most of tray's customers require an ERP system. I think this is a characteristic of any e commerce platform, But about 30% of TRACE customer base was already using BLINK and that's why we chose BLINK for this acquisition. It has an ARR of $16,000,000 and a high chance of synergy across our ecosystem with marketplace, logistics, credit. There's a huge potential for synergies between Bling and the rest of our ecosystem. So Bling is here to accelerate This ecosystem to bring new customers to this ecosystem and the ecosystem will also accelerate Blink. So it's a huge state of symbiosis. Just to give you an example, if we had already had 30% Of our tray customers using bling, you can imagine how the potential that we have for synergies. Another advantage is the data volume from Bling's customers that can be used for credit concession. So it was a fantastic acquisition. Another very interesting acquisition was OktaDesk. OktaDesk is a platform that enables SMEs to better We have already acquired some sales operations such such as Aetus, Idares and Social Miner or OWEN. And Okta Desk will help us orchestrate all these efforts In addition to improving customer service, allowing us to use chatbot, artificial intelligence and conversational commerce as We have been using and it's something that has been really helping us our clients improve their conversion rates. Okta desk has an ARR of R25 1,000,000 and just to give you an idea of the volume of messages managed, More than 3,000,000 messages per day, so it was a fantastic acquisition for us. Welcome everyone from Okta desk to our ecosystem. And when we talk about commerce, we have an example of an e commerce platform focused on social commerce, which is BEGI. It is a quick and simple solution for SMEs and individuals to set up a virtual store in minutes and have a strong presence online. It has a strong engagement on social media. Everything is native, integrated with Facebook and Instagram. So if you want to launch a store and immediately start selling with the support of social media, Facebook and Instagram, this is the right solution for you. Baggy has more than 13,500 customers. This was another fantastic acquisition, which will certainly Speed up everything related with social commerce for local web. So congratulations and welcome everyone from BAGI to our ecosystem. So this is the current status of our ecosystem on Slide number 8. Today in the center, we have our 4 Platforms or 5 platforms if we consider Trade Corp as well. Now we have Okta Desk, Not just for after sales, but orchestrating all the sales efforts, we have Bling, our ERP system also conversing with all the other processes. We have Fendi, we have our sales tools, All In, Social Miner, Atos, Idares. We have Yapei, Plug and Credit Suisseira for payments and credit in Medorin View for logistics. And as I said, we are already yielding good results such as increased ARPU, reduced churn. We can already see a reduction in churn across our chain due to higher customer locking. And this is just the beginning. There's much more to come in the future and also acceleration of customer acquisition. And this acceleration of customer acquisition will be much clearer, 2 slides from now, because we're going to show you what's Happening with the acquired companies, they are truly accelerating when compared with the pre acquisition period. So now on Slide number 9, We're going to show the results for B Online and SaaS. We continue to grow our booking levels compared with last year. So we had another 15% increase compared with quarter 2 last year, which was already a very aggressive period for SMEs, 15% for Next Shoes, 47.3% increase And we were awarded the top level of excellence in customer service at the website, Ricola Miyake, The RA1000 stamp, this is a huge achievement, which shows that we're very focusing on providing the best service to our customers. And the SaaS revenue increased from 30.5% to 39.2% year over year in the B Online and SaaS segment, which means that we're selling more and increasing the share of the segment in our sales, which is very relevant. Now on Slide number 10, here I must reinforce once again that we are being very assertive in the acquisitions that we're making. We so far have acquired 18 companies and All of them were the right decision to make at the time. So quality of the acquired companies is one of our utmost priorities, also a very structured integration process and the high synergy of the new operations in our ecosystem, which allows these companies to ramp up and accelerate our ecosystem. Here I have 7 examples. Of course, we can't give you all the numbers, but I have here 7 examples Showing the power, the true power of this synergy, 200% increase in the shipping GMV for Melior in Vio. And still in Meliorin Vio, there was a 283% increase in the number of customers At Meliorin View, very expressive numbers. In DOCA, our e commerce platform, There was a 192% increase in their customer base year over year, a huge increase. The addition of new clients in BLINK, an increase of 133% and remember what I said, This is the power that our ecosystem has to generate sales for the ERP system, 133% in a very short period of time. Bling is a very recent acquisition, so just the start this is just the start of this synergy. Also increasing the number of Blaine customers, 74%. As I said, this was already a very high growth operation and now it's just going to skyrocket and a 73% increase in Vindis TPV, which is much better than it had for the acquisition and also a 50% increase in IDERA's customer base. So these are some examples and These were huge contributions to the 159 increase in the net revenue for Commerce. Now on Slide 11, We're not done yet. We want more. And why do we want more? Because we want to have an ecosystem that will have SMEs will help SMEs with their e commerce efforts. We need to have a well orchestrated Package of services, we want to be a one stop shop for all our customers. So we will continue with the acquisitions. We will continue to look for companies with recurring revenue, consolidated products, with people that will stay with us after the acquisition with a huge potential for cross sell and upselling synergies in our ecosystem. So we continue with our funnel of M and As and we already have 6 MOUs signed or under negotiation. So we won't stop. Now I hand it over to Igor, our B Online Assess Director, and he's going to show What we have been reaping in terms of synergies between the companies we acquired. [SPEAKER CARLOS GOMES DA SILVA:] Thank you, Fernando. Good afternoon, everyone. As you heard from us in previous conference calls, Here on Slide number 12, we see that our agenda of cross sell and synergies is evolving really well and we can already See very clear results. Of course, the road map is very long term and we still have deliveries that have not yet been completed. But we can see that in a very short time, we have been able to explore synergies and cross sell, not just within B Online and SaaS, but also between SaaS Products and Commerce Products and activities. So here on the top, we talk about Etus on Slide number 12. Ethos is already present in the entire purchase journey for the entire digital family. So we have WordPress, we have Hosting, we have an offer inside LocaWeb's website and also in the site builder. Etus is a very good example of how we are getting good results from these synergies. We already see a very expressive increase in Sales compared with the previous year, in June alone, we had an increase of 253% In sales compared with June last year, Aptusys customer base grew by 60% year over year. This means that Aetus is truly benefiting from this cross Cellenix has been growing organically at a fantastic pace. On the bottom of the slide, we already have the POS, cplug POS integrated with delivery Jireto. So all POS Customers that already have that also have delivery to Jareto, they can get the orders in the POS and they can organize everything related with using delivery to direct to and also other components either for order collection or for physical stores And the joint offer of POS, CPLUG and Delivery to Red was evolving really well. We already have many customers running ConnexPlug and Deliverigirato together in a joint offer for existing customers and new customers. Another interesting example is the integration of Cipla and Samurai. Samurai is an e commerce company that has a very interesting expertise in integrations. They have a great technical staff that's really knowledgeable about market integrations. And we have been using Samura with Cplug and Deliveroo Directo for market integrations. So in the case of C Plug, Samurai is performing integrations of the C Plug POS With more ERP more complex ERP systems, here we have the example of SAP and Samurai is also connecting delivery to that with other external POSs. So in these two examples, Samurai is building the integration, monitoring the accesses, Evolving the APIs and it gets a share of the revenue in these projects as if it were an integration plug in for Cipla and Deliveritiratos customers. So Samurai works as a plug And in the offer of these two products supporting the integration and expanding our capabilities, expanding the capillarity of these products in the market. Now on Slide 13. Here we have an example of how this cross sell is not just Restricted to the time of the sale, but it's a much deeper cross sell effort. This is an example. On the left side of the slide, We have an example of a contextual cross sell based on customer behavior within the product use journey. So in this case, e mail marketing customers who have already sent messages and want to use behavioral features, behavioral triggers. It's what we call repicking, so you can resend emails based on certain settings and configurations. So when you're defining the settings for re pick, The customer will receive an offer to expand the performance of this campaign using Etus. So at this point here, when they are using the product, when they are setting up the product, we will give them a behavioral based offer and Aneta's offer so that they can expand their contact base and expand their campaign. So when they click Contract, when they click buy, the green button. On the website itself, they can choose the type of Profile they want and automatically when they click contract, all the billing will be done by the same local web user. So customers do not have to go to another A page or another screen and register again, no, with their own local web account, they will be billed for the Atos product as well. And on the top right, we have an example of how we're also intensifying cross sell with suggestions based on Buying predisposition, for example, here, we will show some suggested products based on some prepension algorithms that we run while the customer is using the product dashboard. And these suggestions are based on products they registered with, Products they contracted previously, the level of use of these products, the average ticket of this customer with us. So this is another example of how we've been working with this contextual cross sell. Now on Slide 14, Here we have another interesting example of contextual cross sell. Here we're using algorithms that will assess the number of contacts of the customer in the same e mail marketing product And based on the progression of contacts and based on the campaign e mail sent, we will either suggest Aptus or not so that they can expand their contact base during the analysis of the email marketing list. So they will upload the contact list. We will review the contact list, look at quantity and quality. And depending on the results of this analysis, we will offer access to the customer to expand this contact base and to expand this campaign on social media. This way, they can capture more contacts based on this cross sell effort and they can fire a campaign both through e mail and also social media. And these cross sell offers take place at different points of a product use journey. It's something that is much more in-depth than just doing this cross sell at the time of the purchase. And we are strongly advancing this agenda. We have Dedicated teams, which are studying the best moment for use in the prevention algorithms, and we have been capturing Excellent synergies with these initiatives. And now I hand it over to Williams Marcus to talk about Commerzb. Williams, The floor is yours. Thank you, Igor. Good afternoon, everyone. So let's continue. Now let's talk about Our efforts in commerce in terms of cross sell. Here we have some examples. Our agenda has been very intensive and our efforts are parallel. All our units are developing this work simultaneously because all our units, all our platforms already have an API oriented architecture. The first example here is an integration delivery to Geto and YAP Pay. And it's also a cross of segments. So we have YAP Pay for all the billing and payment options of the Livi de Jireto customers. So it's Commerce and B Online. So in addition to exploring synergies between the Commerce units, We also have synergies of Commerce with any other unit in Localeve. The integration of Melorin Ville with Yape is already operating, so this gives The customer more options, they can use their GetPay balance for shipping and this is Very popular right now, particularly due to the marketing efforts that we implemented and the integration between Yapei and regarding fuel. Another example for Yapei, we launched in record time the integration with Yapei and Dhaka. So about 20 days after the acquisition, we already had businesses using Yapei On the Dhaka platform, which opened to us a new horizon to gain even more TPV. So this is in line with our journey of adding financial services with all our other services. Vindi also has a huge potential for payments. This is something we already talked about in other releases. And now we start to see the results. So Vindi is already entering a very mature phase of acceleration in terms of adopting Yapai as its Payment Solutions. Aptos also is already using a pay for payment slips. It's an integration that is already taking place. We already have the beta integration for a digital marketing SME solution for Digital Miner. So this is an initiative for customer acquisition, which adds a lot of intelligence on-site campaigns, Off-site campaign, so this is a product that SocialMiner designed to bring all the technology that it has to enterprise customers Offering to trade customers, we already have the beta running and we are already starting to see very positive results. We also have Idares, our marketplace hub, which is already running with all integrations with Trade Corp and evolving in this agenda in order to better service the trade retail customers. So there's already a huge synergy gain or Potential gain here so that we can have one single marketplace solution. Credit Suisseira, our credit operations are already integrated with Tray And I'm going to share a little bit of this experience with you. It's a very transparent integration and we already see the results from this offer. DOCA, which didn't use to have an automatic integration with BLINK, so BLINK's Staff is now building a new integration with DOCA and we're already running the beta and Tre, which already had a good integration with Blink, where we heard that bling has a great share at Tre and now we're improving and expanding this integration so that it can be the first integration for BLINK. So this is a summary of these synergies. We have many initiatives here, and I'm going to give you more details on Slide 16. So here we have the example of Vindi and the good news is that Yapei already accounts for 10% of Vindis TPV. This is growing as the months go by and it's already exceeded other companies. 70% of new Vindis customers already use Yapei And this is very important because in addition to converting the customer base, we are already the most commonly used option for all customers and 20% of VND customers already run YAPAY. And on the right side of this slide, we see the opposite. Looking at the TPV process by Yapei, we see how much it has scaled up with origins from other Local Web units. So in quarter 3 2020, we had basically everything was delivered to that. And then as we generated other synergies with delivered to that, With Etus, we started to see the representativeness of the cross sell revenue growing in Yape. So today, More than 10% of the TPV process by IAPAY comes from Locaweb units. Now let's move on to Slide 17. Here we have an example of how we are performing this transparent integration. Just like we did for Facebook and other solutions in our ecosystem, Credit Suisse also actively participates In the lives of our customers and their dashboards, we have a menu with all the options of the Tray platform and this is a screenshot of Tray's dashboard. And now we have a new option there on the menu, the credit option, and our retailers can offer can get offers from Credit Suisseira through this menu item. So this is one way we found for them to have access to these products without having to leave their environment. So It's not a link. It's an offer they get inside their management dashboard. Now this is something that we're trying to do for all the synergies and experiences that we want to provide, either for Credit Esferra, Midorin FU and Aderis. We want to use the same model, very transparent and frictionless, where customers can use our entire ecosystem from the same dashboard. And now I will hand the conference over to Rafael, and I thank you very much for your attention. Thank you, Williams. Good afternoon, everyone. Now on Slide 19, here we have the highlights of the quarter. Some very impressive numbers as we heard during this presentation. The net revenue in quarter 2 grew by 57% Year over year, the Corbin's operation had 159% increase. The operational that help us understand what happened in addition to what was shown by Fernando, particularly when it comes to customer acquisition, The GMV increased by 65% year over year. We closed the quarter with BRL4.6 billion and the TPV, which was Boosted by all integrations and synergies grew by 88.6% and closed quarter 2 with BRL712 1,000,000. And not only did we grow, but also we continue to be a profitable company, which Generating cash, so we see a 58% increase in the adjusted EBITDA of the Commerce segment and BRL41 1,000,000 and 28 percent growth in the adjusted EBITDA for the entire operation. And despite our very intensive M and A agenda, We still have a very robust cash position, BRL1.9 billion of net cash by the end of quarter 2, 2020 On Slide number 20, here we see the performance of our different business units. As I said, we closed the quarter with dollars 184,300,000 Commerce shows a very accelerated growth and accounts for Approximately 50% of the business, 46% and in quarter 2 last year, we talked about 7.9%. And this relevance is due to The 2 business verticals that help us monetize commerce, subscription revenue grew by 204% and closed the quarter with BRL35.6 million and the ecosystem revenue, which is more transactional, grew by 134% year over year. And when we add these 2, this leads to the 159% growth in the period. For B Online and SaaS, a very good pace of growth as well. We had 17.6% increase year over Here, we closed the quarter with maybe BRL100 1,000,000 in revenue for this sector and an 8.9% increase in the customer base. So now we have 402,000 customers in B Online and SaaS. On Slide 21, Fernando went over some of this data, but it's very important to highlight that this is the revenue progression of the company on the left. And on the right, we have the first half of twenty twenty and the first half of twenty twenty one and some very impressive numbers here. We Closed the first half of twenty twenty one with e commerce revenue of $150,200,000 which is basically twice as high as the revenue for the entire year 2019. It's already higher than the revenue for 2020, which was BRL142 1,000,000. So in 6 months, we already covered last year's revenue and we doubled when compared to 20 nineteen's revenue. So our consolidated was BRL345 1,000,000 in 6 months, which is basically the revenue of the entire year 2019. So Our company has been truly accelerating its revenues in the different verticals, and we have some very positive growth prospects for the future. On Slide 22, Here we see the EBITDA of the company, the adjusted EBITDA. We see Growth in all sectors consolidated increased by 28.8 percent closing the quarter at BRL 41,300,000 compared with BRL 32,000,000 Year over year, the commerce operation already accounts for 56% of the company's adjusted EBITDA. So if we think about CapEx, the commerce operation for cash generation is already the predominant factor. So Commerce closed quarter 2 with BRL22.9 million, a 58.5 percent increase Year over year, Enabium line sales operation shows a growth of 40.4%, closing the quarter at 18,400,000. Now on Slide 23, it's important for us to understand the impact of the acquired companies on our margin. I shared this with you last quarter and it's important to keep monitoring because this shows that we're not losing. We're actually gaining productivity and growing and maintaining some very interesting profitability levels, improving the group's margins. But of course, when we look at the strictly accounting, EBITDA, We have a maturation period for the acquired companies. And first, we have to complete their integration and then start seeing them grow. So on Slide 23, the consolidated organically, we had an Expansion in our margin 27.3 percent to 27.7 percent and the acquired companies will cause a reduction which made us close the period with 22.4%. Now applying the same dynamics for the other segments, commerce, Commerce operations are still running at organic margins over 40%, so 41.5% for quarter 2. However, considering the share and the participation of the acquisitions, we closed at a margin of 27% for quarter 2. The online SaaS, the same dynamics 20.8 percent for quarter 2 2020, 20.3 percent for quarter 2 2021 organically speaking, but considering the acquired companies a margin of 18.5%. So we're still growing at a very fast pace. We're maintaining high profitability and high cash generation capacity. And when we look at the strictly Accountable EBITDA, this is a reflection of the maturation time and the integration time and we will see This margin recovering quarter after quarter. And on Slide 24, we see the adjusted net income. We had a net margin of an expansion of 87.7 percent year over year. And when we talk about purely accounting Numbers, this is important when we see this in our balance sheet. These are two effects of our M and A model, our M and A dynamics, which is the amortization of intangible assets because of the price allocation that we do when we do M and As And the value is already considered in the price paid, that's why we call it price allocation, which went from 1,000,000 to BRL6.2 million in quarter 2021 and the adjustment to present value of acquisition earn out. Our acquisition model entails earn outs. This is provided for in our liabilities. And since our liabilities are long term, They behave just like that. So they are recorded at a value that is lower than the potential earn out. And we have the interest accumulating quarter after quarter until this earnout is paid up, which showed a 10,000,000 a growth of BRL10 1,000,000 year over year. And we also adjusted based on the same dynamics that I just mentioned. This is included in the price and the PPA. So considering these adjustment dynamics, we go from a 3.6% with a margin of 12.9%. Now I will hand it back to Fernando for his final remarks. Thank you, Rafael. So just to recap the main highlights for the quarter, we This is Slide 26, by the way. The company continues to accelerate even with the reopening of Economy and even when we compare with data from quarter 2 2020, which was a very good quarter for us, Our operations are growing above market indicators and comparable operations. Our commerce operation is accelerating and gaining share within the group. As I said, we are now over 55% of the EBITDA Coming from commerce, we see an ongoing evolution of the commerce ecosystem, and also in house development and evolution of our platforms. This is very important. We are a technology Company and more than half of our staff is made up of engineers. We have huge assertiveness in our M and A process with strategic and operational success of all the companies acquired so far. We have a process for integration of the acquired And we already start to see very consistent results from these integrations. This means that we're very confident and comfortable about the acquisitions that we made, and we're also very confident about continuing with the M and A efforts in the future. And finally, many of the acquired companies already show a very accelerated growth and This will certainly be confirmed in the coming quarters. Thank you very much. I think we still have a few minutes to answer some questions. Thank you. Thank you. We will now open the floor for questions. The first question is from Leonardo Homme, UBS. Good morning, good afternoon, everyone. You talked about the expansion of your channels to reach your customers. What do you see in terms of future trends for channels? And how can these new channels affect Your dynamics not your growth, but the current dynamics. I'm going to answer about the margin and then Williams can talk about the channels. The CAC is increasing. We are spending more with new channels, but this is not really affecting the EBITDA. And why is that? Because the growth of the company is supporting all that. So we do not see any degradation of our margin. We see a trend towards maintenance of the margin. This is very important because we are expanding and the exponential growth of the company is supporting the increased marketing investments without degrading our margin. So this is for the second part of your question. And now Williams is going to give you some examples of channels that we are exploring. All right. So Leonardo, regarding the channels, in order for us to maintain the increase in our customer acquisition, We started to explore new channels. We gave you the example of influencers, for example. It's a very well structured operation to have influencers and some ambassadors that will promote the company and use the services. So these are people that are references in their expertise, either entrepreneurs, business owners who have their e commerce, We have their virtual stores and we'll talk about the platform, the payment options and all our solutions. What we see in this case is that we have a CAC, which is not so higher than that of social media Because today, Google and Facebook also had to increase their prices and compared with these channels, We spend an amount that is very similar in terms of customer acquisition, but we have a productivity gain because many of these Very often, they previously watched training courses and videos. There's a lot of influencers that work with education. So this means that we have higher quality in this customer acquisition. Another example is the DACA project, which is the trial. DACA didn't used to have a trial, Trade didn't have a trial, so we launched this trial recently. This is helping us improve customer acquisition. A great part of these customers do not really contract a plan after the trial period, but what happens is that those that contract a plan with us Our customers that already went through the first decision making process of continuing with us or not. So during the 1st 15 days is where part of our churn takes place. So this in the LTV will have a cohort of customers with a higher LTV because we already had the 1st filter of these customers. So there's in the CAC over LTV, even if we're spending more, we have a higher TV. So these are examples that well, despite the changes in the dynamics of Ratio of LTV and CAC and the ARPU and CAC ratio are very positive for us. With all these solutions, the average ticket is also increasing. So I hope you have answered your question, and let me know if you need anything else. No, that was perfect, very clear. It makes a lot of sense. Congratulations for your results and have a great weekend. The next question is from Bernardo Griton, Chastain de Chimentes. Do we have any more questions? The next question is from Pito Tomita, Goldman Sachs. Good afternoon, everyone. Thank you for answering our questions. I have two questions. Thinking about your ecosystem and the promising acquisitions that you recently made, The next acquisitions will add new markets and new capabilities to the ecosystem? Or do you think the next acquisitions will come to strengthen the verticals where you are already present? So what is your pipeline? What does your pipeline look like in the sense? Is there a specific part of the ecosystem that you're looking to further strengthen? And the second question, I don't know if maybe you can shed some light on the growth of the Commerce segment, how much it is divided between DOCA Trey and EDERIS or the GMV growth excluding EDERIS? Hi, Victor. This is Fernando. We consider our ecosystem to be very complete, but it's an endless effort, right? E commerce is not something trivial. I remember that when I used to have an online Store, we only had e mail marketing and banner and that was it. But today, in order to have a virtual presence, you need to do Marketplace, social commerce, inbound, it's much more complex now and not even mentioning logistics. So it's very complex. And E commerce for SMEs is even more complex. E commerce is evolving and will continue to evolve. And that's what we're doing. Social commerce appeared. We added some social commerce Offers, conversational commerce, we recently added conversational commerce. E commerce will continue to evolve And we will continue to have including new solutions into this ecosystem because our customers, SMEs, will demand These new tools, either for lead generation or for management or for customer service. Everything has to be present in this ecosystem. So as I said, it's an endless work. It will never stop evolving. And we will also be looking at new verticals. So we're working in these two fronts, completing our ecosystem and looking for new verticals. And regarding your second question, We can't really give you more details about the GMV breakdown by platform. Okay, no problem. Thank you very much. Thank you, Victor, for your questions. The next question is from Gabriela Moraes, Itau BBA. Good afternoon. I have two questions. The first question is about the addition of sellers. How are you working on adding new sellers? And in quarter 3, Do you see an increase in your churn? Because we saw good acceleration in the seller addition, but some deceleration compared with quarter 1. And the second question is about Yapei. We see that the Share of your acquired company is already 10% of Yapei. So how do you see this looking forward? Gabriela, so I'm going to answer your question. The first part is about bookings. With the new channels that we're Florian, we see that we were able to maintain our booking at very high levels, well above the pre pandemic levels and very close to the peak pandemic levels. So what we see is very sustainable growth And with the testing and opening of new channels, we project that we're going to continue to grow and to create new booking opportunities. So in spite of the pandemic, Of the slowing down of the pandemic, which is a good thing, right, we see that the demand for e commerce continues to grow. And with the new channels, we can compensate for the more accelerated demand of the peak of the pandemic. But our booking levels will continue to be very high. The churn, we have a normal behavior in the premature churn. In the 1st 6 months, we lose part of this Base and these are practically those customers that were not able to operate their virtual store or gave up the project or changed their strategy And then the churn becomes really small. What we see in the past 3 months, in the past quarter is an improvement in the premature churn. It's been higher in the past, particularly in the peak months of the pandemic where we had a very accelerated entry of new customers and Very often, they were not really prepared for that. And now we see improvements in these numbers. And this is also a reflection of our E commerce schools are educational units to train these customers and we that's why we see this improvement in churn. Now regarding Yape, in Vindi, we still have a great part of the TPV. So we still have a lot of work ahead of us for a few years and Vindi and the other units are growing. So in addition to increasing the Chervindi is also growing its customer acquisition. So we believe That despite the higher share, this ecosystem will continue to grow. We have DACA as an initial ecosystem. Our share is still very small. We are just starting. So we start to see some good prospects For DACA, including with the new trial for a better entry of customers, we have BEGI, the recently acquired company, and we don't have Yape integrated yet. We are studying this right now and Bling that has both online channels and payment links and also some projects for payment acquisition in the physical world. So we believe that with BLING and CPLUG, we can also work in this Sphere. And with Deliverix, we still have some share. So considering the company is already acquired, we still have a lot of TPV to capture And these are companies that grow organically. And we also have our pipeline. And one of the premises for our M and As is that these companies have synergies with our current units and nearly all M and A so far have opportunities for payment. In our pipelines, we also have good opportunities to activate payments with YAPAY. The next question is from Marco Nargini, Cispaime di Chimentes. Mr. Marco, you can ask your question now. Mr. Marco, your line is open. You can ask your question. I think this was the last question. Okay. So this question and answer session is now closed. Now I hand it back over to Mr. Fernando Cerny for his final remarks. I'd like to thank you all for the number of attendees today in this conference call, an impressive number of people. We're happy to have you here with us. We're very proud of our results. And once again, I'd like to thank our customers, suppliers, employees and particularly our shareholders. And we'll see you soon in 3 months, hopefully. Thank you very much. Have a great day. The Q2 2021 earnings conference call of Localeb is now over. Thank you for attending and have a great afternoon.