Good morning, ladies and gentlemen. Welcome to the earnings call for the third quarter of 2023 from Multiplan. We have here with us today the executive directors of the company. We inform you that the presentation of the results can be accessed or downloaded at the website ri.multiplan.com.br/en/. Before starting, let us mention that forward-looking statements that are done during this earnings call regarding the business perspectives of the company, projections, and operational goals and financial goals are based on beliefs and premises of the board of directors of Multiplan and based on information that is available to the company. Any forward-looking statements is not a guarantee of performance. It involves risks, uncertainties, and premises. These are based on forward-looking statements and depend on circumstances that may materialize or not.
Investors should understand that general economic conditions, industry conditions, and other operational factors may affect the results of the company and may lead to results that differ materially to those expressed in the forward-looking statements. Now, I would like to give the floor to Eduardo Peres, CEO of the company. He will start the presentation. Mr. Peres, the floor is yours.
Hello. Welcome. I would like to thank everyone that is listening to us. It is a great pleasure to be with you here today and to share with you the exceptional results, unprecedented in the history of this company. I would like to highlight a few points that are very important and that really bring the attention to our performance this year and this quarter, the third quarter of 2023. Let's talk about sales. They've been growing in an accelerated fashion and overcoming our expectations.
We grew in the quarter 8%, we grew in the year 9.5%. Our earnings is BRL 718 million until September, and that is almost the earnings of last year, all the year last year. So BRL 700 million facing BRL 445 million. I don't remember the number off the top of my head, but the important thing is that year-on-year, we already produced the net earnings of last year, and we still have the best quarter yet to come. So this is great news. The performance for the earnings. Over the last 12 months, our earnings reached BRL 957 million. So we are here, meters to the billion. That was an internal number goal. That is an important goal for the company, and it's close to us. It's almost real. Over this quarter, we had the net delinquency that is negative. So we recovered actually much more than we lost.
This is for the first time in the company. We got 500 stores rented, subletted. So we are talking about 80,000 sq m of the ABL. Well, we have over 80,000, it's almost a BarraShopping of new stores. This brings bigger, new options for the people that visit our shopping malls. We've done over 800 events, and this is a very important data. So we can analyze how we operate and how we make the shopping mall profitable. The pandemic has turned us into something more efficacious. We improved the way that we operate our shopping malls. So we are improving the promotion of the sales event. The culture as well that lead to entertainment, they bring content for all the enterprises. Let me talk about the growth strategy that is based in the expansions and the revitalization of the shopping malls.
This is a strategy that is conscientious, and it is a strategy that we have taken many years ago. We had here the opportunity to have a lot more malls than what we had before. But we preferred to have the best malls. We are aware that we want to be the best in every single city that we are operating. This is our obsession as a company. We want to transform all of the malls, even the good ones, and we want to improve them, and the ones that have not reached that maturity, we are going to get there. Continuing to invest in our portfolio today of all the options and opportunities that came up, this seems a more viable and more profitable.
This shows that we are in the correct path, that our path is a one-way street, and we are going to continue in that path.
Just to exemplify a few things, and we are going to deliver next year. Barigui, we have the expansion 90%. If I could, I would open the expansion today. But it is a shopping mall that we are investing BRL 300 million in expansion, improvement, and it will be another equipment. DiamondMall. It will be luxury in Belo Horizonte. And for the first time, we are going to transform the entirety of the shopping mall in good food courts, international brands that were not there. We knew that we had that niche, and this is the shopping mall that has 40%, 50% subleted, but we are going to have the expansion open. We have in our pipeline of expansion, I am going to show you that we are going to start next year.
One that is very important for me and maybe it does not seem so obvious for those of you that go to the shopping mall is Morumbi Shopping. Morumbi Shopping grows. Next year, we are going to start the expansion in January. We start with a total renovation of the shopping malls in January. It is not I think. We are going to start the works of the expansion and the revamp of Morumbi Shopping that is scheduled for these two investments, yeah, BRL 300 million, BRL 350 million. And then people say, "Well, Morumbi is doing so well. What is happening?" Well, that is what makes us work with so much will and love. We want to improve on what we have always done. We look at Morumbi and we see failures that maybe people did not see in the very competitive market such as São Paulo.
This is the important vision that allows us to advance every single day in the direction of being the best in every city. We will do the same in Brasília. Brasília is getting close to the 40 years. We revamped almost the entirety of the mall. We are going to do the expansion in Brasília. The project is ready, was approved. Same thing will happen in Maceió. This company has grown this way up until now. I do not see why we should change it, and I do not want to change it. We are still paying attention to all the opportunities, even in-house. The most viable and more profitable are presented close to us. Growth is that. I wanted to talk about an important point, which is our digital initiative.
We wanted to remove all the entries of the shopping mall with a device that we created with another company. This is a share technology so we can facilitate the customers that are getting into the shopping mall. We are implementing the new gate system in three new malls, in a third of the malls. Our intention is that this new gate system, for the next first four months of next year, 100% of our network will have no entry gates. Why is this important? It is important because it improves the experience of people at the shopping mall. We created the Multi app with that function, with that definition, this path moving forward. We are investing in a tool that will make the life of the user of our enterprise, it will be a better, more quality life.
That is how we are improving the quality of life of people, and we are bringing big amount of information for us. The growth is very expressive over the last few months. The recurrence of use is very good because people that try it, they do not want to stop using it. We are not making it mandatory that people use Multi. They can pay physically in the shopping mall if they want to. But we want to convince the people that this app is good. It is better that you are in this environment. This is our objective. I would like to highlight the social initiatives that we have had this year. The shopping malls, they have an interaction and an interactivity with the communities that we are inserted that is very important. Whether it is doing improvement works in hospitals, in schools.
I am going to show you the recent example of Porto Alegre that went through a terrible flood. People were without their homes, without food, without their needs. The shopping mall donated, and we have gathered a lot of things, and we donated it back. This is what we do in all of the cities that we are present in. Our initiative to placing the possibility of providing schooling for our employees in the primary, secondary school is expanding. We had it first in BarraShopping, and now we have it in São Paulo, and we hope that in the close near future, that we have the entirety of the network for education, the continuous education of our employees implemented in all the network. I would like to remind you, Multiplan is going to be 50 years next year. It is an important date.
I am very proud to be a part of the 50 years with such an important result, very symbolic and significant. 50 years of dedication, extreme dedication, and an obsession for improving the experience of the consumer. The results that you are seeing here of revenue, we are going to have a record-setting year next year because of the improvements of the experience of each of these malls. This is our obsession, once again, and I would like to thank enormously to the people that are here with me in the room, the people that work with all the malls, whether if it is our employees or subcontracted parties that make this day to day ever better for everyone. Thank you very much for listening to me. Thank you. Now let us go to the Q and A.
Thank you. We will start now the Q and A session for investors and analysts. If you have any questions, please click on the Q and A button and write down your name and your question. The questions will be answered in the order that we receive them. First question. First question is from Mr. Gustavo Cambauva, the analyst of BTG Pactual. Gustavo, you can ask your question.
Hi, good morning, everyone. I wanted to ask you a question more in regards to the investments that you mentioned on expansion. I wanted to understand, given the scenario of retail that is more challenging, the expansions. Do you think that the investments are going to be more focused on expansion and maybe thinking about a greenfield, that was something very important, the growth of the company. Do you think that for greenfield, is it still far away? Or in this scenario that the sales of Multiplan are growing well, can you think about a greenfield?
The second question is, well, it's a follow-up of the issue of investments. You've distributed a lot of dividends, and the company at the same time it's unlevered. Do you have any intention of maybe increasing the payout via dividend or JCP? Or are you going to remain with the current threshold and the leverage that you're guiding? That's it.
Gustavo, this is Eduardo Peres. Let's subdivide the question. I'm going to answer the first one, and that's concerning the expansion and the greenfield. To clarify, do you have a preference to do expansion? Of course, yes. Because this is a strategy that is positive for the company for many, many years. I close the doors to the greenfield never. However, greenfield is different, much more challenging. Specifically, when you don't have the certainty of the economical variables that we're going to have up ahead. The uncertainty makes us move towards the direction of the expansion. Are we looking at greenfield and acquisition? We're always going to do both. I'm going to let Armando now talk about the dividend distribution that you commented and de-leveraging.
Well, look, Gustavo, we keep over the last 12 months, BRL 1.050 billion in a capital allocation distributed amongst the return to the money to the investor and repurchasing of the shares that added to the BRL 685 million. That's in CapEx, that's BRL 414 million. So if you take a look at our earnings, there is a long record of the profit sharing with our investors. Since 2011, we've profit shared over 50% or more of the net revenue post-reserve.
With the exception of one year that we had a big accounting in 2006, a big accounting point, and, well, that's the records of the company. We have cycles of big growth, and this cycle that the growth is preparing to grow more in expansion. Not only will we have the space to do the profit sharing, but without fiddling with the leverage in a big way. We're also repurchasing the shares. As you know, we have the approved program in June, and if you look at this year, it was 4 million. I think it was this year, or it was 12 months, sorry. 4.8 million shares repurchased. As Eduardo has said, we have money in CapEx, and we have a pipeline of growth. But this is because of the strong operational goal of the company, there is leverage.
Even though we are getting more money to work when compared to the last year, there is a small deleveraging because of the good results. We can do more. While we have to be in two, three times is something very comfortable through the covenants. What we do not want is to place ourselves in a position that we cannot take on the opportunities that are in the market. We are always going to work with some leeway, then if we want to, we can act immediately.
Thank you. Have a nice day.
Now we continue. The next question is from Felipe Lenza, Sell-Side Analyst, Citi. Please. Go ahead, take the floor.
Hi, good morning. Congratulations on the great result. My question will be very brief. Given the continuity to the previous question, there is a possibility of acquisition of an asset from Allos, for example, Parque Maceió?
Hi, Felipe. This is Eduardo Peres. Your question, you talked about Allos, but we are here analyzing all the opportunities that we think that makes sense for us. I think that you mentioned Parque Maceió, right? Nobody told us that it was for sale. If it is, we are going to take a look at it, but here we are not pursuing to try and be the largest. We want to be the best. We are going to continue down this path, which is important. Sincerely, out of the opportunities that we have taken a look, I can mention one. There is a lot of shopping malls in the market that is in the same city of a mall that is the same of ours, and they started the same time that we did.
At the beginning, in the 1980s, when there was the inception, they had a better performance than ours. I am not going to say the name of the asset or the city, so it is not really out there. When I looked at the numbers, to my surprise, happy surprise, our shopping mall grew 3 times what that shopping mall sells. The path that we are undergoing is a prosperous one. We are always going to take a look at all the assets, whatever they are, even if they are an entire company. Did I answer your question, yes?
Perfect.
Next, our next question is from Tainan Costa, Analyst, UBS. Tainan? Please take the floor.
Good morning, Eduardo, Armando. I wanted to explore the theme of provisioning. Until the pre-pandemic, the provisioning was something about 15% of the total of accounts receivable of the company. Now when we look at the last report of the quarter, that number doubled, close to 30%. I wanted to understand, what needs to happen for this provisioning to go back to a level that was closer to the pre-pandemic 15%? It would be the delinquency more control for more time, and maybe we would see the reversion of provisions more recurrently on the short-term, and if that is the point, what would be the level of delinquency that is ideal, and for what time can we deliver those reversions?
Thank you for your question, Tainan. I am going to start backwards. There is no level of provisioning that is ideal. The provisioning is possible and in accordance to the circumstances of the time. Your question is appropriate in this quarter because it shows a strong recovery of previous rents, specifically of previous quarters.
As you commented during the pandemic, there was a provision that was increased, and they increased because there is an increase of the percentage that you provision of the rent because of the time that goes by, which is aging. You start provisioning 15%, whatever. I'm just giving you a number off the top of my head. It all depends on the deadline, the time that it spends. But that success that you mentioned on the receivables is also a mirror of the performance of our tenants in the shopping malls, the desire to be in the malls, and a series of other circumstances. There is no one specific explanation. It's a set of factors, but the main factor is that Eduardo already mentioned this.
We are making our shopping malls better for our clients, and this is going to be better for the tenants, and consequently, they want to stay and do not lose that point of sale, and that helps in the recovery of provisions and consequently reduces the percentage as time goes by. That provision in growth, grows as you grow your rent revenue. This is what we see over the pandemic from the end of the pandemic till now, 50% growth in rent. This is due to the volume and the time. Did I answer your question?
Yes. Thank you.
Next question from Daniel Gasparete, Analyst of Itaú. Daniel, the floor is yours.
Good morning. Thank you for the call. Congratulations on the result. The quality is impressive in a very difficult retail wholesale market. Two questions. First is to understand the dynamics of rent in a few assets. It's bringing our attention the evaluation of the rent in Morumbi Shopping, an evaluation quarter-on-quarter. I understand that quarter-on-quarter is not the best analysis, but to understand, we observed that there is a small drop, dip, even though we saw a great performance in sales in general in the market. I wanted to see that first point, understand it.
Second one, I wanted to understand the issue regarding the communication on the. I'm going to read it. In regards to the statutory authorization for the creation of preferential shares after the shareholders' agreement. I wanted to understand more why you're keeping this infrastructure and why not seize this moment and migrate to a new market. I'm sorry for the question, but more so I can understand the rationale behind that. These are the two questions. Thank you once again and have a nice day.
Hello. Okay, Daniel. First, rent. Really, the comparison quarter-on-quarter on this exercise doesn't make any sense. There are many things affecting here. That's why the comparison year-on-year makes more sense. The comparison over the last few months is better, in my opinion, because you get any hiccup, let's just say, during the quarter, as you mentioned. Specifically in the shopping malls that you mentioned, we had a few isolated events due to actions and success in negotiations that affected the results in the second quarter and not the third quarter. Just to answer your question. Besides that, you have also, when you open the rent, you start to see that the complimentary as well as merchandise, it decreased over the quarter.
When you look at the closed rent, you see that there was no growth in the second quarter of 2023 to the third quarter of 2023. Would you like to complement anything?
Well, something else. Merchandising in the second quarter, usually, seasonally is higher. It is true, we had great campaigns for merchandising the first quarter. We have the increase, the decrease. Second quarter is where you have Mother's Day. There is a lot of seasonal merchandise that gets in the second quarter that leads to this. Armando talked about this. We have Valentine's Day. We have seasonality. I know that you know very well, if you compare it to this quarter, it is going to be higher because seasonally, fourth quarter is stronger.
That comparison is limiting, as you mentioned, but the point that you mentioned, merchandising in the last quarter in the shopping malls was very strong. Remember the BarraShopping last quarter grew quarter-on-quarter, year-on-year over 10%, 12%. We have a campaign that is very successful in the last quarter. Second point, Daniel, the issue of the market motivated because of the conversion of the preferential shares, extraordinary shares of our partner. There is today a bigger difference than what happened before between the disclosure on level two and the disclosure to the market, which are now the preferential shares, which make it difficult for that migration within the market. But regardless of the disclosure, what the company tries to do is to adopt the best governance practice so we can do not only our guidelines and also that our day-to-day is permeated by this.
Recently, for example, we have an internal audit area that works to support the team, supporting our processes in a way that is very proactive. Amongst others, amongst many other actions for governance that we have here today. Not answering directly. We are not looking for a new market in the short term.
Thank you for the answer. Thank you, Hans. Thank you, Armando. Have a nice day and a nice weekend.
Next question from Mr. Ygor Altero, analyst from XP. Ygor, the floor is yours.
Hi, everyone. Thank you for the congratulation on the results. Two questions on my side. Let us go back to. I wanted to understand if you see a space for the selling of assets of any of your portfolio asset that is non-core. Secondly, I wanted to understand the performance dynamic of Santa Úrsula and Vila Olímpia that are really bringing attention on the sales performance. What do you attribute to this very positive performance? If you can share the initiatives to improve the performance of these assets. Thank you.
Eduardo Peres. Good question. Santa Úrsula and Vila Olímpia. They improve because of insistency. Nothing overcomes insisting. We are going to insist until they work out. Nothing happens for no reason. They are growing. We are seeking operations and solutions for each and every one of them. It is not easy. These are cities that have a lot of competition. Even Ribeirão Preto, there is a level. I think, I did not do, but GLA of Ribeirão Preto is comparable. Gross leasable area is comparable to São Paulo.
It's in an area of the city that the first one, Santa, is in a deteriorated area. We're trying to make it into the growth point for that region of the city. It's not easy, but we are never going to give up. Vila Olímpia also. It was in the best moment pre-pandemic. We were doing very well. The region of Vila Olímpia suffered an enormous impact, mainly with the remote work. Here you can see that several places all throughout the world, business centers, they cease to exist. We're still privileged because there is a path moving forward, and there is work to return it to its former majesty. There is a lot of houses being built, apartments being built around Vila Olímpia that is going to be a benefit on the medium long term.
But we're going to continue to promote, insist, and to take the good operations because from then on, we're going to get a return on investment. Selling assets. Yes. Look, might happen. I'm not saying no. People don't really talk to us. I mean, they do, but to buy stuff that we're never going to sell. That's it. These assets, we never stopped to think about that, if it's worth it or not, we discuss it. But the option is to continue to improve. When the asset is good, and there is several people interested, and then we don't want to sell it. It's complicated, but it is what it is. It happens to us.
Thank you.
Now, the next question is from Mr. Bruno Mendonça, analyst Bradesco. Bruno, the floor is yours.
Hi, good morning. Thank you for the opportunity and the presentation. Eduardo, Armando, Hans, two questions. My first question, when Eduardo was talking, it was very focused in an investment in the assets and taking care of these assets. Thereafter, you talked about the digital strategy and investments in these lines. I understand that this is a maintenance CapEx. Every quarter that goes by, it's more proven in your results that this investment increases the differentiation of the assets in regards to the rest of the market, and that gives you good low-hanging fruits. But can you quantify how much that investment is costly?
I mean, what is reasonable historically with our models? There is always a CapEx of maintenance, I don't know, a percentage of the NOI, the revenue. I wanted to understand how you think about this investment. This investment, I mean for the entirety of the group, revamping digital strategy, anything that is investment to maintain the capacity of the assets to generate revenue and growing as they've been growing. But how do you think about that? Percentage of the revenue of the NOI? Is there a different math? This is the first question.
Bruno, are you there? We lost you. If you can tell us sorry, can you repeat the second part? We lost your connection. I understood until you said CapEx for investments in digital. Second part, I didn't hear it.
I wanted to see if we can quantify that CapEx, maintenance CapEx, if it's a CapEx for maintenance, a big group for digital strategy, anything that is initiative to keep the capacity of the assets generating revenue, we saw it as a revenue percentage, an NOI percentage. Do you think about that in that way or is there any other way that we should think about this investment? That's the first. Second, you can hear me now?
Yeah. Go ahead.
Second, I wanted to go back to the theme that Gasparete mentioned on the issuance of maybe the PNs. It's clear that this is a new movement for a new market. It's not so obvious. But can you tell us a hypothetical situation where you would think about using the prerogative of issuing these, for example, to pay M&As? What would be the other situation that would justify you having this prerogative in your guidelines?
Hi, this is Eduardo. I'm going to share this in two parts. The first part that you asked about the remodeling, revamping the digital projects, is there a magical number to invest? No, there is no.
It's more according to the need that you perceive of your assets. At every mall, they need an intervention, so we don't lose the market. There is a funny situation, and I was talking to a partner about an asset in New York, and we were at the beginning of the remodeling, and he was saying, "Well, finance is questioning me because we're investing a lot. What do I tell them?" I say, "You have two options. No investing, losing the asset, or investing and continuing with the asset." So revamping, remodeling, maintenance is that. We are still, remember, licking the wounds of the pandemic. So when I talk about that, Morumbi was a mall that needs to be taken care and a lot of care. We didn't do anything big in terms of renovation in Morumbi for many years.
The pandemic really caused a lot of problems and taught us a lot but caused a lot of issues. So in terms of number, we will have more of an expense next year and less expense over the next year. Maybe BRL 250 million, BRL 300 million of digital initiative and renovations for next year, and BRL 100 million maybe for 2025, if I'm not wrong. But these are not set in stone because this number can change. There are times that you cannot do anything as there was in a pandemic, but when you need to do things, you need to do them correctly. This is our specialty.
Bruno, just to complement. I know that it's very difficult for you guys, analysts, to place it in a model. For us, we also get into a model to confirm as a percentage of NOI, but this is just a reference. It's what Eduardo mentioned.
Not necessarily it's going to be mandatory or limited to do that. It all depends on the opportunities, the perception of the manager, and of each mall. Second question, the issuance of the PNs. Well, I'm not proposing anything. We have here the possibility of maybe one day, if there is an opportunity, we're going to do that. So we are here celebrating results of a great management and a great control of the company, of the infrastructure and capital allocation of the company, and I think it's important and fundamental. So what we want is to have instruments on the market that have opportunities, a market where the players listed represent a fifth of the GLA or less national, and we see a great opportunity for growth. We just want to convert this opportunity. So there's nothing proposed.
In the case of the should we have a conversion, we will leave it in the guidelines possibility of doing it. There is nothing being proposed now.
Thank you.
Thank you . We are going to continue. The next question. Fanny Oreng, Santander analyst. Fanny, we are going to open the audio. You may take the floor.
Good morning, everyone. Congratulations on the results. Really good. Two questions. First, can we talk about Golden Lake? How is the expectancy of sales? What do you think about in terms of launch in 2024, the project? The second one, if we go back to the theme, on average, the investors are very uneasy with the M&A and the possibility of Multiplan doing an M&A that is transformational. We know that there are several assets of Multiplan, important ones, such as outstanding minority participations that would make more sense. I wanted to know how important it is for Multiplan to do this transformational M&A from the strategic standpoint, and Multiplan, in my opinion, has a great part of the great assets of the market. So I wanted to understand the mind of Eduardo in that sense.
Hi, Fanny. It is a pleasure to answer. Thank you for the questions. Golden Lake. Marcelo is here to help me. We have a strategy on the long term, the project of 10, 12 years up ahead. We are here in the first phase, Golden Lake Victoria, with 54% sold. We are where we wanted. Could have been better. It also depends on the economic variable, because the sale of a real estate is very sensitive to the future of what people see in stability of the country, economy. But we did not stop. We still are building.
We are going to deliver Lake Victoria at the end of next year. We are going to launch, maybe in the first quarter of next year, a smaller enterprise with the possibility of having a smaller ticket and products, diverse products within the same condominium. Will help with the liquidity you will have. The point is that place did not exist. It was the backside of the Jockey Club. We transformed it into a real estate. It was a very complicated operation. Took 10, 11 years to happen. Every time that I visit the place, it is almost Barra da Tijuca of Porto Alegre. We still have here to invest almost BRL 150 million of counterpart that are going to be in the region, making the continuation of the lakeside of that part of Beira Rio. In regards to the second part of your question, an M&A transformation M&A.
I do not know. It is difficult to answer because I do not see something that excites us or to really look at the numbers. For now, nothing happened guiding us towards that path. Might happen? Yes. The only guarantee that I can give you is the following. You are going to be the first ones to know if that is to happen. Now, it is not. Did I answer the question?
Well, sort of. I understand it is complicated. I think that there is a big anxiety in the market in regards to the level of the values they negotiate versus the private market transaction. So the investor is really thinking, well, Multiplan negotiates a cap of 12, but buy somebody with a cap of seven, and then you dilute that threshold. Maybe that type of point frightened us. So it was for us, does not make sense, something like that for you guys. Is there any that you say, "Well, would that make sense?" I think that this is the anxiety of the investor, giving you a feedback of what we discussed.
Fanny, once again. I understand the fear and the lack of surety of the market. Today, we do not have it. Today, I can affirm that there is no negotiation on the table. We do not look at everyone, and today it does not happen. It is difficult to assemble this operation. M&A is not something easy because it depends on the other side. We did not choose to grow through expansion. We wanted to do expansion and growth through greenfield. First, we are good at it. Secondly, we can measure and do this. M&A, I cannot. I am not going to do it. I do not need it. There are people that to exist need M&As. I do not need it. I do not know if I answered your question, Fanny.
Just to complement. The definition that a transformational for us is bottom line. Transformational, you grow the line of the revenue, and you lose money down below. It does not make sense. It is very much in line with the investors, and as Eduardo said. Look at the records of the company of growing in an organic way, growing with new projects, growing with expansion, and there is a lot to do. I am going to give you an example. The biggest operation that this company has done, we bought Bozano in 2006. That was the other half of our orange. Multiplan was half, we bought, and we ended up buying debt, just debt.
Opening, listing, and we could not, and then we had the Canadian. Maybe there is another opportunity like that. Yes. But it does not make any sense for me to change the control that I have today just so I can have. Today I have a company that I know what it is. I control. That delivers results, expressive results. Why am I going to change this for something then I do not know what is going to happen. Just to be bi`gger and transformational? No, that is not in the minds of anybody here. Just to tell you what we do not want.
Thank you. And congratulations for your numbers.
Now the next question is from Mr. Marcelo Motta, JP Morgan Analyst. Marcelo, please, the floor is yours.
Good morning, everyone. Two questions, very quick. First, in the services revenue, if you can tell us the volume, if there is anything else that you want to give us, if that was cash or just the volume of the contract, and what would be the options? Do you think that in the future, there is still more to explore with that issue of the agreement with the telecom? The second is the expectation for Christmas. We see that retail is more cautious with Black Friday, the sales because of inflation, smaller. When we see the nominal coefficient is weaker, but we want to understand what you are thinking about the fourth quarter and Christmas.
This is Armando. First part. That services cycle was larger with the contract that we have done. We cannot give the disclosure of values in negotiation. It does not make sense. But if you look at the second quarter, there was another revenue that we negotiated because of Multi, and we do that for 50 years, seeking optimization of our revenue, optimizing our results. We have the potential of bringing up revenues that the shopping mall has, that the portfolio has. That is part of what Eduardo said of the obsession of making the mall better, and that generates the opportunity to grow also in the financial part. Would you like to comment on the expectation?
Yes. Thank you for the question. The expectation for Christmas is great. We are very optimistic. We are working Christmas all day. All year, sorry. Whenever I go back to the beginning, I start the strategy at the beginning of the year. We work with Christmas all throughout the year, and now we're thinking about next year already.
It's an obsession to have differentiated Christmas. What does it mean? Promotions, events, experiences. It's to surprise the consumer in every way possible. We are a company that makes sales. Everybody that operates a shopping mall opens the door and waits for people to get in and get out, buy, and then they charge the rent regardless of the tenant. Here, we don't work that way. Here, we fight for every single cent, and we fight for every improvement that we can find up ahead. My expectation for Christmas is very good. We're very much prepared with several campaigns that are important and iconic things that will happen in a few cities that we're installed that will make our Christmas better. That's the certainty.
Thank you very much.
Now, we received a few questions written down. I'm going to read them for the board. First one is from Marcel. He says, "Could you tell us about the changes in the tax reform and the impact for the company?" Repeating. Could you talk about the changes of the tax reform and how those changes impact the company?
Thank you for the question. Look, it's too early to do an analysis on the tax changes that are upcoming. Some of the changes do not impact the result of the company directly, others, yes. We have to evaluate what's coming up. The tax reform is undergoing. The real estate sector was included with a specific regime, still undefined what is going to be the percentage that's going to be in a complementary law in the future. The tax reform that we are seeing, it should be transparent given that this is a payout of the tax that you do.
There shouldn't be a direct impact in the DRE of the company. The reform that discusses the interest rates of our own capital, if there is another impact, and it's very preliminary, and there is nothing being proposed that was approved at the chamber in the Congress. We are waiting and seeing how we are going to adapt in the best way to the reforms.
Another question from Daphne Lashnir. She's asking, "I'd like to have a better overview about the lower growth of BarraShopping. Do you consider that the Shopping Jacarepaguá captured part of the public of Barra? Thank you."
Hi, Daphne. It's an interesting thing that we showed. If I'm not wrong in our public meeting last year, we showed how BarraShopping was on sales, and New York, which is complementary, and the sales grow. Campo Grande was open. It's a competition, yes.
The sales of Barra grew, and Campo Grande from zero had a potential for sales that is great. Village Mall was open on the side of BarraShopping. BarraShopping is growing in the Village Mall, also in a market that did not have. It is growing even more. It is our second best square meter. The same thing with Jacarepaguá. Jacarepaguá was born in 2021, November of 2021. Growth started from scratch. There was nothing there. BarraShopping continues to grow. Barra, there is a change in mix that is important, and we cannot do the omelet without breaking the eggs. In a sense, you have a store that a new operation, some operations that are coming that are spectacular, but another one closes, you lose sales temporarily until the tenant leaves, and we start preparing the project, we implement, and we are going to start from scratch.
This is what we are seeing. Exchanges in mix that is important, that has a specific impact in the revenue of rent, and consequently, of sales. On the contrary, the fact that Jacarepaguá is more complementary. The operations that we have in the shopping malls are complementary, and we are very proud to see in the long term. That is why I ask you to see this presentation last year that we showed the great growth that we had all throughout time. I hope that answered your question.
Perfect. Another question from Caio Lacerda, Ventura Analyst. Could you give us how it was the first months of the gateless parking lot? What was the delinquency behavior? Could you repeat the second part? What was the behavior of. The behavior of the delinquency. I mean, from the company or the parking lot? He does not mention. Possibly he wants to know if there was any. Could you give us how it was the first month of the gateless parking lot? What was the behavior of delinquency, if there was any delinquency in the parking lot?
Answering the question. It was the gateless was my initiative. I had the idea because we really wanted. We were satisfied with the antennas go back and forth, and that creates a problem at the entry of the malls. The shopping malls have a tumultuous entrance. It does not read very well, does not read here. There has to be a better technology than the antennas. That is why we created the free-f low. We were not going to remove the gates, but we evolved to say, "I do not need a gate. If I have the license plate reading connected to the payment, why do I need a gate?"
It evolved so we can really provide a better service. Up until now, wherever it is implemented, there is a success. People like it. Those that try it, they like it. We do not mandate, oblige every. Many cases in the world, you see that you have access to Disney, you need to download their app. Otherwise, you do not use anything. It is not the case of the free-f low. We created something easy for those that want to use it. It is very positive for the malls that we implemented this. I imagine that the delinquency is over somebody does not pay the parking lot. There is no possibility of that because the gate is at the exit, so the control continues to exist.
We created the ease for people to get into the mall, and we will keep it all throughout the network. I hope that I answered your question. Thank you.
Well, thank you for all the questions. We close the Q and A session, and we invite the participants that still have questions to get in contact with the investor relations department. I would like to give the floor to Mr. Eduardo Peres for the closing of the session. The floor is yours.
Once again, I would like to thank everyone. It is a very special moment for the company. We return to growth, we return to dreaming. We are very excited with the perspectives for growth of the company. The results, they speak for themselves. It is a very special moment, a historical moment, another year of breaking all the records. I think that we are down the right path, doing the right thing. Thank you to all the analysts, investors, partners, non-partners, employees, and my colleagues that work with me at Multiplan. Thank you very much. Have a nice day, and thank you for the result.
Thank you. The earnings call of the third quarter of 2023 of Multiplan is closed. Have a nice day.