Good morning, and thank you for holding. Welcome to Pague Menos' quarter two 2022 earnings conference call. Today, we have here with us Mr. Mário Queiroz, CEO, Mr. Luiz Novais, CFO and IRO, Mr. José Rafael Vasquez, Operations VP, and Renato Camargo, Marketing and Customer Relations VP. We would like to inform that participants will be in a listen-only mode during the company's remarks, and then we will have a question and answer session when further instructions will be given. Should any of you need assistance during the call, please press star zero to reach the operator. This call is also being simultaneously broadcast via webcast online and can be accessed at ri.paguemenos.com.br. Questions sent through the webcast platform will be answered later after the conference call by the investor relations team.
We also inform that this conference call will be conducted in Portuguese by the company's management, and there will be simultaneous translation into English. The company clarifies that it's following all safety protocols, and all participants were previously tested before this conference call. Before proceeding, we would like to clarify that any forward-looking statements made during this conference call relative to the company's business prospects, projections, and operational and financial targets are based on beliefs and premises of Pague Menos' management, as well as information currently available to the company. These forward-looking statements are not a guarantee of performance. They involve risks, uncertainties, and assumptions. They refer to future events and therefore they depend on circumstances that may or may not occur.
Investors should understand that general economic conditions, industry conditions, and other operational factors may affect the company's future results and may lead to results that differ materially from those expressed in those forward-looking statements. Now I would like to hand the conference over to Mr. Mário Queiroz to start his presentation. Mr. Queiroz, you may proceed.
Hello, good morning, everyone. Welcome to another earnings conference call of our company. In quarter two, among the highlights, I would like to mention the approval by CADE and the acquisition plan for Extrafarma. Yesterday, August first, we signed the closing, and we became the second largest pharmacy chain in Brazil. With nearly 400 stores and the addition of approximately BRL 2 billion, we are going to hold a significant share of the market, and we are going to expand our leadership in the north and northeast of the country.
You're going to hear from Vasquez shortly, more information about Extrafarma and this transaction. I would also like to highlight the publication of our sustainability report. We communicated to the market all our commitments and ESG targets, and Novais is going to give you more color about our sustainability results.
Quarter two numbers, we had strong margins, and the contribution margin of same-store sales reached a peak of nearly 13%. During this call, we will also hear from Renato Camargo, our new Marketing and Customer Relations VP. He will introduce himself very briefly. He will now be in charge of our health hub and will share with you the news about our services and digital channels. Now I hand it over to Luiz Novais, and he's going to share with you the results for quarter two. Novais, please, the floor is yours.
Thank you, Mário.
Good morning, everyone. Let's start on page number four. I'm going to share our results with you. You already heard some of the highlights for quarter two, and just to add to what Mario already presented to you, let's start with our operational results. In quarter two, we opened 28 new stores. We now have 111 new stores opened in the last 12 months. Now we're going to go into a more normal pace for our new openings. Now in quarter three, we start to have a fairer comparison in terms of new openings because in the last four quarters, we were comparing with periods with no openings, with periods with new openings. Now we're going to have more consistency in our results in this sense.
In the last four quarters, also due to this cycle, we also had some pressure on our results due to the normal speed of our new openings. In the first months of existence, stores deliver slightly lower results than more mature stores. The second highlight here is the 31.5% gross margin. We had a great pre-season work. We were able to reach a 0.5 percentage point increase year over year. As you heard from Mario, we reached nearly 13% of contribution margin from same stores. 0.6 percentage point increase in same stores. We are improving our results in same stores, and we continue with our catch-up journey, improving our same-store results and funding our expansion. Strategically speaking, we have three highlights. 9.6% of sales through digital channels.
You're going to hear more about our digital channels from Renato. We had more than 41% increase in sales in our digital channels year-over-year. The sustainability report, you already heard about it. We're going to talk more about that later. It was an important development for us in our ESG front. We really recommend that you read our full report. We have a lot of interesting information about the company. The closing of the Extrafarma acquisition, which has excellent potential for value creation for the company. You're going to hear more about this during this call. On slide number five, we have information about our organic expansion. As I said, we opened 28 new stores in the last 12 months.
We have most of them concentrated in the Northeast, 92% in classes B2, C and D, and 65% in inland municipalities. Our maturation curve is still very in line with our projections, consistently evolving. In addition to the maturation curve, the store economics are performing really well, better than planned. Most of the stores are already providing operational profit, and we're really happy with the new cohort of new stores. On slide number six, we show our same-store performance. The total growth in quarter two was 4.6%. For products, we had a 7.3% increase. We had the negative effect of COVID tests, which was really strong last year in quarter two, accounting for 3.4% of the total sales of the company.
This year in quarter two, comparing with quarter two 2021, we had a negative effect of -2.7%. Here, the highlight is the distinct behavior when we compare the different regions of the country. Where, as you can see on the second chart on the right, you see the same store behavior in the North and Northeast is very different from the rest of the country. North and Northeast same stores was 6.1%, and the other regions 11.3%, with highlight to the state of São Paulo, where the same stores was 18%. The demand for flu drugs and drugs for respiratory problems in the Southeast was much stronger than in other regions in Brazil. That's why we have slower growth in the North and Northeast.
We also saw an ascending curve comparing the months of the quarter. April was a little weaker due to a more, heavier demand in the end of March due to the price readjustment for drugs. In May and June, our same stores were already a little stronger. On the next slide. Oh, sorry, I forgot to mention on slide number six that we also have a very small number of stores at that stage of the first two to three years, still in their ramp-up stage. The same stores here is practically the same stores of mature stores. As I said, we are in the start of our expansion cycle with 111 new stores opened in the last 12 months. On slide number seven, we see our sales growth. We have an increase in tick.
The average ticket is stable. Actually, it decreased by 0.3%, but within the average ticket, we have the inflation component that we have to take into account. Inflation accounted for 8.2% and 2.9% for drugs and a lower inflation for non-drugs. The mix component that affected negatively in 1.2% due to the expressive growth of generics and private labels that we have been seeing lately, which is very positive for the company. In the units per ticket component, we had a 6.8% decrease due to the COVID-related behavior. During the pandemic, we had a certain number of items per ticket, and then it increased because the frequency of the visits decreased.
Now coming out of the pandemic, this behavior is going back to the previous, pre-pandemic levels. On the next slide, we have our market share. We had a 40 basis point reduction in market share. Here on the right, we see a very differentiated behavior when we compare the different regions in the country. According to IQVIA, the North and Northeast grew by 7%-8%, and South and Southeast, 13.2%. These are regions that together account for 67% of the pharma retail market in Brazil. Due to the representativeness of the Southeast and South and our stronger growth in these regions, which was much due to the COVID outbreaks, respiratory problems, and the winter season, we have a higher proportion of growth in these regions.
As a result, we have a drop in our market share where we have a stronger position in the North and Northeast of the country. On the next chart, we show the growth elements by the number of stores. On slide number nine, we highlight. On the left side, we have Brazil, and the right side, the North and Northeast. The growth for Brazil was 17.4% for the market as a whole and nearly 11% due to volume.
This was driven by the winter season and COVID products, as I said, and 6.5% due to the new openings. On the right side, looking at the North and Northeast, we see that the market grew by 16.1%, very robust growth, but at a lower level in terms of volume, 7.1% for volume and price, and 9% for new openings. Pague Menos grew very much in line in terms of volume and price. Once again, I must stress that Pague Menos has a small number of stores in their first two to three years during their re-ramp-up stage. 3.3% for new openings for Pague Menos. We're very optimistic.
We're evolving really well in our expansion cycle, but we still have a contribution of new stores that is at a lower level than the rest of the market. On page number ten, we have the evolution of our sales mix, the mix of products and services. Here we see a decrease in the share of services due to the decreased demand for COVID related products. We went from 3.3% of services in quarter two last year to 1% this year. The positive highlights here are for generics and OTCs. We go from 22.3%-23.5% for OTC. These are two categories that are expanding and favoring the growth of our gross margin. It is a very strategic category that is also favoring our gross margin.
Here on the next page, we have the evolution of our gross profit and margin. We have important captures in quarter two. We grew by 50 basis points. The positive effects are due to the price increase, the price adjustment for drugs, also the product mix. We see that generics and private labels are growing well. On the opposite direction, but still something that we're betting on, are digital channels and partnerships and agreements. We had important growth in this area. We're going to hear more from Renato about these two channels. We're going to continue to invest. Here the point effect in the gross margin was negative. COVID tests, these are product categories that have a higher average margin than that of the company.
Due to the reduction in the number of products sold in this category, we also have a negative pressure in this category. On the next page 12, we have our contribution margin. Selling expenses, when we look at same stores, we had a decrease by 10 basis points, which is very positive in our view due to the inflationary pressure, which means that we are controlling our expenses, we are improving our productivity, our store productivity mostly. This is what's helping fund the pressure that new stores are suffering or are exerting on our results. Sixty basis points of improvements on the right and contribution margin for same stores going from 12.3% to 12.9%, which is very positive for us. Overall, same stores here are funding the new openings.
This means we were able to grow our contribution margin, even if with the point pressure or the one-off pressure of the new openings. SG&A expenses and EBITDA. In G&A expenses, we grew 10 basis points quarter-over-quarter. We are reinforcing our teams for our digital channels and our technology team as a whole to support the company's growth. We're also making investments in strategic consulting work and also the inflationary pressure that we are suffering for this group of expenses. These are fronts that are helping build the future of the company. We believe that in the next quarters, with the company's growth and with the start of the Extrafarma integration, we will start to see the administrative expenses diluting over time. On the right, we have our EBITDA.
We were able to grow 10 basis points our EBITDA margin year-over-year, quarter two last year was a record-breaking quarter in terms of the company's EBITDA, we are in a very positive position, even with the inflationary pressure and the pressure from new openings. Next quarter, as I said in the beginning of the presentation, next quarter, we will start to compare with other periods where we had new openings. We will see a better increment here. We will see better growth in our EBITDA margin. On page 14, we have our net income. We finished quarter two at BRL 56.2 million. On the right side, we see that the components that affected our net income. The sales effect and the margin effect were positive compared with quarter two last year. Operationally, we're doing really well.
There was negative pressure, particularly from financial results due to the interest rates. We went from an interest rate in Q4 to last year, close to 4%, to a standard interest rate close to 13% in quarter two this year. This certainly puts pressure on the results and the income of the company. There's also a higher pressure here in depreciation and amortization due to the investments the company is making in the new openings. On slide 15, we have our cash cycle and debt. We continue to have a very strong stock. We finished the period at 115 days of stock. The pharma industry is still working to replenish and recompose their stockout levels. We are still investing highly in stocks to be able to support our sales and our growth speed.
We finished the quarter at 65% of cash cycle. On the right, our net debt finished at 1.7 times the net debt to EBITDA ratio. We issued debentures on July, so we don't see the effects yet of this debentures issuance. As measured by FIT, we continue to advance consistently and within planned, balancing investments and management of our cash and the company's debt. On page 16, we're very proud to communicate, as you heard from Mário, that we are publishing our first sustainability report. We worked for one and a half year in preparing this report with a lot of important information. We conducted a very comprehensive survey with the company stakeholders. We have 32 sustainability targets.
It's a very complete document, and we recommend that you all read the full report because there's a lot of interesting information about the company. Now I hand it over to Renato, and he's going to talk about our health hub.
Thank you, Novais. Good morning, ladies and gentlemen. First, it's a pleasure to be here. I've been with the company for three months, and my three month anniversary comes with the good news of the closing of the Extrafarma acquisition yesterday. I will be responsible for digital marketing and customer experience. In the last four years, I was the country manager of one of the largest fintechs in the country, so this led me to invest in other startups. I was in GPA for a few years, responsible for loyalty and CRM strategies, and particularly the digital transformation.
I was responsible for the digital transformation of Pão de Açúcar and Extra and Gol Airlines. Now let's talk about our health hub. We see that Clinic Farma, our pharma clinics are growing continuously. We have reached 995 units. These clinics are not just injectables rooms, but a complete space for first aid and primary attention. During COVID, the customers were already counting on a large range of services, and now considering the power the Clinic Farma has of creating traffic to the stores, we are expanding our offer. We also have telemedicine, which allows clients to not have to go to an ER or to a hospital. These services are much cheaper and more accessible.
Clinic Farma is really contributing to turning us into this real health hub that you have been hearing about for a few quarters now. Agreements and partnerships are also growing continuously, reaching nearly 30% of our total sales in quarter two, and these partnerships bring three great major benefits: organic traffic, loyalty, and brand expansion to tens of millions of customers of our partners. Finally, we have our special drugs and compounding, which also have a great share of the sales of the company, considering that the structural investments were recently made, and we're still seeing the ramp-up of maturation of this front. These are drugs with excellent margin, and we're going to have more sales reps allocated in the regions.
Compounding will also grow, particularly due to the marketplace that we already started implementing in quarter two, and that will service the entire country. On slide 19, expanding the reach of Clinic Farma, we have our strategic partnerships that go beyond just agreements for drugs, drug sales. The focus is to join forces with other companies to be a first point of access to healthcare. Usually, the users of the Brazilian health system, they don't know where to start to search for medical care because the system is very fragmented. There's an expressive percentage of these people that end up going to the ER, but they wouldn't need to go to an ER if they could be seen at a primary care clinic. We are becoming a first stop point for these partners.
We are triaging these patients, which is a benefit both for health plans, such as LIV Saúde, and also hospitals themselves. As part of this journey, we started our Previne Saúde, our plan that starts unlimited telemedicine for BRL 9.9 per month, completing the client's journey within our stores. On the next slide, we see our digital channels have been growing continuously and structurally. Our concern here is to gain scale in a structured manner so that this growth is not just a one-off event. This is something that we're doing in a structured way to ensure continuous growth. Our app is growing its share, reaching 52% in the total digital sales. When we include telesales in our infinite aisle, it's nearly 30% of our proprietary channels.
The click-and-collect modality already accounts for 32% of the digital sales of the company, allowing customers to go to our stores, reducing the freight cost, the shipping cost, and buying other products and services during their visits to our store. On the next slide, we have our social commerce. We have our Pague Menos Store. It is a unique product in the pharma retail arena, mixing extra income with the power of influence of people that will have their own store. We have nearly 7,000 active stores in this period, accounting for nearly 8% of the e-commerce of the company. It helps us gain credibility and organic traffic. When we have more organic traffic, of course, this helps reduce the cost of acquisition of our customers, the CAC of the company. Now I hand it back over to Novais. Hi.
Thank you, Renato. I would just like to talk about the financials of the Extrafarma acquisition, and then Vasquez, who's the sponsor of this project, who's going to give you more information about the integration. On page 23, yesterday we announced the closing of the transaction to acquire Extrafarma. Starting August 1st, we start incorporating Extrafarma in our balance sheet and effectively managing the company. This was a one-year period since May last year, and we had important developments. We had 16 months working and defending the process with CADE, the competition authority in Brazil, mapping all the synergies. We also used this period to plan the integration. It was a little longer than we expected, this period, but these additional months were very important so that we had an even more robust planning for our integration.
We also used this time to formalize the divestments that the stores that CADE established as a requirement that we need to divest. It was a slightly longer period, but very useful and fruitful to us. On the next page, we have the updated transaction terms. The enterprise value didn't change, BRL 700 million that we had signed in May last year. The net debt decreased, so the debt situation of the company improved. In May last year, it was nearly BRL 100 million, and today it's nearly BRL 36 million. The working capital also improved compared with the moment when we signed the contract. It improved by BRL 73 million. All these factors will result in an equity value of BRL 737 million.
Minority shareholders of Ultrapar, a small portion of them adhered, so they want to remain as shareholders of Extrafarma. We bought 98% of the company's shares, and BRL 730 million was the purchase price, which is going to be paid as the first 50% were paid yesterday and the other 50%, half will be paid in August 2023 and the other half in August 2024. Now we're consolidating the company starting August 1st. In quarter three, we will start showing the evolution of the company after this consolidation. Pague Menos and Extrafarma, the separated numbers and the consolidating numbers. On page 25, we see our capital structure after the acquisition of Extrafarma. Before the acquisition, we finished quarter two at 1.7x. That's net debt over EBITDA.
With Extrafarma, you're going to see in the coming slides that this was one of the effects of IFRS 16, with a marginally negative EBITDA. Here we're adding the debt to the company, so we're going to reach a level of 2.7x the net debt/EBITDA ratio. Then we have complementary investments in stocks and other elements from Extrafarma, so we will go close to 3x. After capturing all the synergies and the cash generation from Extrafarma and Pague Menos in the consolidated numbers, we will go back to 1.7x net debt over EBITDA in a two year horizon after the integration. On the bottom, we see the strong liquidity position of the company. We did a debentures issuance, as I said.
We have close to BRL 900 million in cash today with another BRL 600 million in receivables, so BRL 1.5 billion in liquidity. The average maturity of our debt is very reasonable, close to three years with a rating of AA-. We are in a very comfortable cash position. Of course, we still need to control our investments to be able to keep these levels looking forward. Now I hand it over to Vasquez, and he's going to talk about our integration plan. Vasquez.
Thank you, Novais. Good morning, everyone. As you heard from Renato and Mário, since yesterday we started the integration of Extrafarma, and the last 14 months from May last year until yesterday, we were building the map of this integration, and now we are effectively putting it into practice together with Extrafarma's team.
This is something that we already visualized in the past, but it's very important to highlight what are the pillars of this integration. We will start with logistics efficiency. We talked a lot about this topic, but we will have our DCs of Extrafarma and Pague Menos. They are very complementary when we consider regions such as Maranhão, Pará, Pernambuco and Bahia, so this will strengthen our logistics system. We will be able to optimize our logistics and our tax aspect as well. Starting in October 2022, we will do the turnaround of our DCs. It will be finished by January 2023, and the technological integration that will accompany this turnaround of DCs and stores will be carried out in the next eight months. We'll also migrate 100% of the DCs and stores to Pague Menos. Why is this important?
You all know that the M&A and systems integration process is very systematic. When you try to do the two-form, this can create some noise and some bottlenecks. We chose to do a takeover process. An effective replacement of the Extrafarma system with the Pague Menos system, which has been designed in the past 14 months with a very important support from Grupo Ultra, which has been very supportive in this integration, particularly due to their background with the systems for Pague Menos. Another very important point that we've invested a lot of time this week is that the Extrafarma team will remain unchanged. We'll have the same organization now with two sides, Pague Menos and Extrafarma. As I said, we are here in São Paulo.
We have a solid office here in São Paulo in Vital Brasil that we expanded to receive Extrafarma's team, and this is a process that we started yesterday. Now we have the two brands working together in one. This also creates a lot of synergy, and this creates a lot of opportunities. From the operational standpoint, which is very important for us, and we're going to talk about more synergies later, but for example, our retail suppliers and non-retail suppliers will be consistently integrated within six months, and then we'll start capturing the synergies. Another important point, when we talk about our top line, you're going to see that we're going to expand our assortment in the Extrafarma stores, both by the addition of new SKUs and also reduction of stockouts, going back to our logistics efficiency.
You heard from Novais about the playbook that we made during 2019 and 2020 in Pague Menos, and we believe that this will be very useful for Extrafarma now, and it has to do with this expansion of our assortment and supply chain. You heard from Renato about our health hub and how we are standing out in the market. Pague Menos has a health hub. It has its clinics. This is an initiative that we will also implement in Extrafarma stores because they have a very convergent public and convergent regions with the Pague Menos brand. Now on slide 27, we have our mapped synergies that we mapped over these last 14 months, and now we are rectifying these numbers.
We started calculating a range of BRL 150 million-BRL 250 million, which were now updated due to the inflation rate to BRL 180 million-BRL 275 million, which should be captured in the next 24 months, more or less. Where are these synergies coming from? They come mostly from the assortment, both increase in SKUs, decrease in stockouts, gross margin. We have a lot of opportunities, particularly in private labels. If we look at the macroeconomic environments, if we look at this year and next year, we see even greater opportunities for our private labels, which are very strong in Pague Menos and are being developed also in Extrafarma. SG&A contract renegotiation, which is very important also in logistics.
We know that retail is a type of business where availability and utilization are important aspects, so here we also have an important lever from our logistics and from the two companies combined. On the next slide, as you heard from Novais, this is the consolidated view, the view of the consolidated company with the Pague Menos brand and the Extrafarma brand in 2021, how we were and then how it is in 2022. As I said, we are very involved in the Extrafarma business. Extrafarma has the São Paulo stores. Quarter two was very interesting, and we gained a lot of momentum in the states that were more impacted by respiratory problems.
This new company of nearly 1,600 stores, the second largest pharma chain in Brazil with a lot of opportunities to improve the average same-store sales per store. This will be one of our greatest levers. In the first half of the year, we had nearly BRL 5.5 billion in gross revenue. The EBITDA, as you also heard from Novais, the ex-IFRS EBITDA is BRL 202 million. A very promising company. We're very optimistic about what we mapped out in the last 14 months, and now we have all the Pague Menos and Extrafarma executives working together to deliver on these synergies. I turn it back over to Mário Queiroz. Thank you, Vasquez. We are truly now entering a new cycle, a new era for Pague Menos.
Pague Menos now will be the second-largest pharma chain in Brazil. Not just that, but we also saw in our survey that we will be among the top 10 retail chains, not just in pharma, but in any industry, including franchise with nearly 1,600 stores in Brazil. We have indisputable leadership in the North and Northeast, nearly 20% market share, 2.5 x more than the second player in the Northeast. There's no other chain with such a high level of leadership in one region of the country, and here we're talking of two regions of the country. We are leaders, absolute leaders in the North and Northeast, and this shows how promising our future is as the second-largest player in this industry in Brazil.
Finally, we have the largest platform for health services in Brazil, with nearly 1,000 clinics, Pague Menos clinics, and 200 more clinics that we're going to implement in Extrafarma. We will effectively offer a complete health hub to all our customers, to all our patients, and this is something that makes us really proud. We are very positive and very happy, looking forward to this new era for Pague Menos. This is the end of this presentation, and now we can open for questions.
Thank you. We will now open for questions. To ask a question, please press star one on your touch phone. If your question at any point is answered, you may press star two to remove yourself from the line. The questions will be answered in the order they are received.
We kindly ask you to pick up your handset to provide optimum sound quality when you ask your question. Please wait while we poll for questions. The first question is from Maria Clara, Itaú.
Good morning. Thank you for answering our question. We would like to understand what are the short-term prospects in terms of profitability for the company. Can you please focus your answer on the details about the stock-out, which were the most important drivers that affected your stock-out level this quarter, and also the future prospects for integration of Extrafarma and how this will be translated in profitability and performance in the short term. Thank you.
Thank you for your question, Maria Clara. I'm going to talk about the stock-out question, and then Vasquez is going to answer about Extrafarma and our growth prospects.
Novais, you can add to the answer if you'd like.
About stock-out. This is something we've been monitoring since quarter four 2021. With the Omicron outbreak, the industry was not prepared, and especially regarding antibiotics and products for children. Because during the lockdown, the demand decreased by 50%, so production also decreased. When we had a new outbreak, the industry was not prepared, particularly in these categories that I mentioned. Now we start to see normalization, particularly in quarter two, April and May, but we were still affected in quarter two with stock-outs. We believe that we're very close to normalization. There was also an operational issue, particularly in our DC, that supplies to eight states in the Northeast. We had a bottleneck in our operation, so there was a delay in supply.
It was a mix of an industry problem and a problem of the company, a logistic and operational problem of the company, which was already solved. We believe in quarter three, we won't have any more stock-outs hindering our sales or performance. Now, if you'd like, Vasquez, if you want to talk about the growth of Extrafarma.
Yes, we understand that we already started to capture synergies from quarter two. The last quarter before the integration. We are already revising our contracts and commercial conditions, and we may have to change providers or suppliers in this sense. Our expectation is to start to see the synergies starting quarter two. Why is that?
Because in October, we will start migrating the Extrafarma stores to the Pague Menos system, and the supply of Extrafarma stores will start to be performed by the RDC. After this starts in quarter two, we will start to capture the synergies, and along with that, we'll start to see some SG&A initiatives. This is a great question. Yesterday, I was talking to Extrafarma's team and Miguel, the operations head of Extrafarma. We will visit the stores, and I want to really reinforce what Miguel said about our playbook. This is no longer a map. It's already an implementation. We had some supply and stock-out challenges in Pague Menos in the past. We believe that more assertive supply, improving our assortment, and investing in private labels, we will start to capture these synergies.
Of course, there will be a ramp-up. We showed this in our presentation. The ramp-up will start in quarter three or quarter four post day one, so next year. We should start seeing something after the second quarter post-integration or quarter four this year.
I just want to add something, Maria Clara, to this explanation, but now talking about Pague Menos. Since Pague Menos in quarter three last year opened 25 stores, in quarter four, 48 stores. The comparison with this year becomes fairer now because since our same stores are having a very good performance and our new stores are going through a very positive ramp up, we will probably start seeing better performance in our EBITDA margins.
When we compare the next quarters with the previous quarters, both in same stores and new stores, we're seeing a very positive evolution.
Thank you. The next question is from Daniela, XP.
Good morning. Thank you for answering my question. My question, I want to understand the market share dynamic of the quarter. It's very clear that the North and Northeast had a slightly lower performance than that of the other regions. I want to understand the dynamic of each region. For example, the states of the North and Northeast, where you ended up losing share, and we saw another player gaining share. I don't know if this explanation is related with a stockout problem, and maybe the competitor's management had a better capillary management. I want to understand why you lost share in these states and how you plan to recover this share looking forward. Regarding the two bills that are now being discussed in the Brazilian Congress, the first is about pharma products.
I want to understand how you're seeing the approval of these two bills and if you've estimated the price transfer that will entail.
Thank you, Danniela, for your questions. If anyone wants to answer. Regarding the market share, we are now resuming the growth of our new stores. We opened 80 stores last year. We have a guidance of 120 new stores this year. As we showed in the last 12 months, we have 111 new stores that are now contributing to our growth. However, the average period is three to four months, so they're not contributing very much right now to our growth.
The slide that showed the comparison of where the growth is coming from, if you look at the North and Northeast, 9% of the other chains of the market come from new stores, and our growth from new stores is still at 3%. When will we start to see our market share neutralizing, or when will we go back to gaining market share? When the speed of the new openings is in line with the market or faster. This is pure math. We applied all the operational improvements. We do stockouts, expanded our assortment, and grew our digital channels. There's a portion of the market growth that comes from new stores, and this is something that we started tackling with the 80 stores last year and 120 this year.
When we have more stores in the first, second, third year contributing to our growth, we will start seeing normalization or resumption or recovery of our market share. Now, regarding the two bills, we talked about this in our last conference call. What we want as a pharma chain, Pague Menos and Extrafarma, what we want is to play the same game. We want that the same requirements made to us are made to grocery stores, to large retailers. We are focused on improving access to the population. The large retailers, nearly all of them have or have had drugstores, and this didn't really change the game for us. Some of them closed down their drugstores. Some of them sold to another chain. What will change?
This may have an impact or not, but what we want is that they have to comply with the same requirements that we have to comply with. Regarding the floor, the price floor. Sorry, the pharmacist's minimum salary, it's very difficult to talk about this after a pandemic. The government is now putting a lot of effort in maintaining the levels of employment. In the end, you will be decreasing the number of positions, the number of jobs for pharmacists. In Brazil, we have 80,000 drugstores. The smaller drugstores will not be able to pay the salary that is being suggested, the minimum salary that is being suggested in this bill for pharmacists. The population may be harmed by this bill. The large chains will be the ones that will be able to pay the minimum salary.
Of course, this cost will have to be passed on to the consumers. You know that we work with very tight margins. This additional pay that is being suggested will certainly impact the prices. Something that is being seen as a benefit to a class of professionals in the end may not be so much of a benefit to the general population. I have just one more thing that I want to talk about in terms of our market share. We are always closely monitoring this indicator. It's a very important indicator, particularly for retail. We know that retail has continued to grow to gain scale and have commercial power. Also, we don't want to be too bold, so we're opening 120 stores.
We know that this is the number of stores that we can open comfortably with high quality, that the stores will have a good level of profitability without cannibalization. We're looking at this indicator, but we're also looking at profitability, so we're balancing these two indicators. We're also paying attention to our cash position. We have 111 stores, but they are at their initial stages. They're contributing with half of their potential in these first years. It's a low level of contribution. The market inaugurated a lot of stores in the last two to three years. We are now focusing on expanding with high quality. Shortly in the future, we are sure we're going to resume our search for gaining market share and profitability.
Okay. Very clear. Thank you.
The next question is from Joseph Giordano, JP Morgan.
Good morning, everyone. Thank you for answering my question. My first question is about your operational efficiency. We see that the company is working with a small number of employees per store, and this number, it keeps dropping. I want to hear from you if there's space, there's still space to reduce expenses. You mentioned in the beginning of the presentation that the same stores for the classes C and D are working with an even smaller number of employees per store. How fast can you carry out this change on the side of Extrafarma? My second question goes back to the topic of the stockouts. Can you somehow quantify the impact of same-store sales? Because when we look at the average, it was 10%, and the same store.
The average same-store sales was 4.5% for the quarter. You mentioned that in June, you were already running at 10%. I want to see how you're seeing this trend for June, if it's already above the average numbers. Now looking at your market share, I want to understand if you expect to be recovering some of the share that you lost in the North and Northeast. Of course, excluding the Extrafarma effect, but if you expect to see recovery of the market share in quarter four this year.
Thank you, Joseph, for your questions. I'll try to answer all of them. I'm going to ask Vasquez to talk about productivity and reduction in our headcount and employees per store and the quality of the services provided.
You're going to hear from Novais about the growth of our same-store sales.
Hi, Joseph. It's a pleasure to talk to you. Productivity, this is something we have been talking a lot about, even pre-IPO, and this is something that I have been strongly advocating since I joined the company in 2018. We had a significant reduction of our headcount per store, but always accompanied by tools to improve the receipt of goods at the stores, improving the POS system. We have our sales dashboard, for example, which is a tool that really facilitates. We continue to see an improvement in productivity. The name of the game for us is not to reduce our headcount, it is to improve our productivity in the average sales per headcount, per staff.
In July, we continued to see this trend towards an improvement in our productivity, improving the average sales per employee per store. We still have a lot of space to do this. That's an excellent question. Possibly, we don't have that much space to do more in this sense. The points that we reached today, we were expecting to reach in 2024-2025. Of course, there's still some space. We still have processes that can be automated in our stores. We have rollout improvements for our new POS system. We have it at about 100 and a few stores, and we want to expand that. The average ticket, the new POS is more user-friendly and faster than the current POS, so we should still be seeing some productivity improvements in the coming quarters. Now, regarding Extrafarma, that's another excellent question.
I had this discussion yesterday with Miguel, the operations head of Extrafarma. Of course, this has to do with a change in culture and mindset for our team. Yes, we also expect to be able to implement actions like the ones I mentioned for Pague Menos, together with another tool, which is the workforce management tool in Extrafarma in the coming months. This is an initiative that is already mapped in our synergies, and we can't really waste time. Always looking at an important indicator, which is our NPS. Our NPS continues at 70%. We had an absenteeism challenge recently during the pandemic, which also impacted the store absenteeism rate, but we were still able to obtain a productivity improvement and maintain our NPS. One thing always walks hand in hand with the other.
Your question about same-store, Joseph.
We grew in the North and Northeast. Our same store was 7.3%, the total, and most of our stores are in the North and Northeast. The market numbers, as we showed in one of our slides, according to IQVIA, the market grew by 3.9% in the Northeast and 8% in the North. It's a much smaller growth rate than what we saw in the South and Southeast. We always joke that in the North, at least in Ceará, where I'm working for a few years now, the weather forecast, the weather girl in the news is going to be out of a job because we practically have no winter there. It's different from what we saw here in the Southeast.
The temperature was lower than 10 degrees Celsius or 9 degrees Celsius at some points during the winter, so the temperatures are not so friendly here in the South and Southeast, so we have more respiratory problems here. The demand for flu products, COVID products is much more intense in the South and Southeast. In the North and Northeast, we're growing for non-COVID products very much in line with the rest of the market. The winter that we had in 2022, it was very different from what we saw during the pandemic. The level of contamination of influenza and other respiratory problems was very intense this year. Since we have a better position in the North and Northeast, the growth level is smaller there, but we are growing in line with the rest of the market.
In São Paulo, the same store for the 80 stores in São Paulo was 18%. We also grew in the Southeast, very much in line with the market as a whole, but we have a much smaller presence in the Southeast. Now looking at our market share, as you heard during Danniela's question, the same-store effect is still very marginal to us. Only 3% of our growth comes from new stores. In the market as a whole, in the North and Northeast, this effect is 9%. We have to wait a few quarters until our new stores can start contributing, growing their maturation curve. We continue to open new stores, and then there will come a point when we will even exceed this growth portion coming from new stores, and we should see that happening in the coming quarters.
Thank you.
The next question is from Victor Nistor of Santander.
Good morning. I have a question about your market dynamics. It's very clear why you have a different performance when you compare the different regions, but I want to know about the company's expansion in terms of the sales level. Of course, you have more relevance among classes C and D. Considering the inflationary pressure, can this impact your sales in the next quarters? And what is the expected leverage for the company after the CapEx for the Extrafarma integration? And when you get to more than three times the net debt EBITDA ratio, and how does this converse with the buyback that you announced yesterday?
Thank you, Victor, for your questions. Regarding the leverage, I'm going to ask Novais to answer your question. Your first question was a little confusing to me.
You asked if there is any mismatch between the performance of the stores for classes A and B and C and D.
Actually, the question is about the company's expansion, which is more intense in classes C and D, and if this could have impacted or could have an impact in the company's sales in quarter three. Vasquez, can you answer this question?
Yes, of course.
No, Victor, that's a great question. We were even looking at new stores, and Vasquez was talking about this, D two, C and D. I understand your concern, and it's probably the market's concern as well, that classes A and B are more protected from these economic oscillations. This is not something that we clearly see in terms of the exposure of our stores for classes C and D in comparison with classes A and B.
I believe that due to the nature of the products that we sell, these are basic products. I think they're one of the last items to be cut, so not for mature stores or new stores. Even for new stores, we have a performance committee for new stores. There's nothing changing, any difference in the maturation curve in relation to the classes that a store services.
Thank you.
Now about the leverage level of the company, Victor. Yes, we reached 2.7x the net debt EBITDA ratio due to the payment of 50% of the Extrafarma acquisition. Then we're going to make other investments in the company. After three to six months, we reach a peak at 3x. Then based on the cash generation, we'll go back to 1.7x in a two year timeframe.
This estimation already contemplates all the investments that we're planning to make in Extrafarma and the integration and maintaining a good speed of growth in Pague Menos, maintaining our investments in infrastructure, technology. These indicators or these multiples of our net debt EBITDA ratio already consider all these variables, and we're very comfortable with these projections.
Thank you.
This question and answer session is now closed. Now I hand it back over to Mr. Mário Queiroz for his final remarks.
I want to thank you all for taking the time to participate in our conference call. In the next few months, we will be fully focused on integrating Extrafarma. We've been preparing for this day one for more than one year now. We're very eager, we're very positive, very happy with this acquisition. Organic share. We reiterate our guidance of 120 new stores this year.
As you heard from the beginning, the Extrafarma integration will have no impact on our organic growth. Expansion of our digital channels is a major highlight. In June, we already went over 10% share of our digital channels, and this continues to grow strongly in July. Renato joined us recently but is already showing very good results. The success of our social commerce, which is something that we're the only ones in the market that offer this, and this creates a lot of sense of belonging, not just to our employees, but also some influencers. The idea is that Pague Menos will be a perfect fit for each of them. When we have the private stores in our e-commerce, this was a great idea that our digital team had and that is working really well for us.
Thank you all, and I'd like to leave you with an invitation. In October, we will have our Investors Day, the Pague Menos Day, and the Extra Farma Day, and I hope you can all take part. Now that the pandemic has slowed down, I hope you can come to Fortaleza to visit us and bring some sports shoes, because if everything works out as planned, we will have a race. We prepared a race. It's a very special event that we have here in the city of Fortaleza, and I hope you all can visit us. I hope we can get to know you better. We always say that there are a lot of you we already know, but a lot of you we have never met, and it will be a great pleasure to meet you in person.
I hope you can join us in our Pague Menos Day. Thank you, and I'll see you next time.
This conference call is now closed. Thank you all for participating, and you may disconnect your lines now. Have a great day.