Earnings Call: Q4 2023

Mar 28, 2024

Earnings release

Summary

Recurring 2023 earnings reached a record CLP 182.6 billion, with ROE close to 20%, supported by stronger banking and annuity businesses. Growth plans center on Banco Internacional and Confuturo, while pension and health reforms remain key uncertainties.

Hello, everyone, and thank you for joining ILC's fourth quarter 2023 results conference call. Today with us is Pablo González, ILC's CEO, and Rosario Letelier, Chief Development Officer of ILC. Before starting, I would like to invite everyone to download from our website a presentation prepared especially for this conference call. The purpose of this document is to go through the main events and achievements for the period, as well as to explain the context and financial figures for each of our businesses. Pablo, you can start with the call. Thank you, Gustavo. Good morning and welcome, everyone. Thank you for joining us on this conference call. We will talk about the results and the main milestones we achieved in 2023. To start, maybe talk a little bit about the results. As you may see in the chart, we closed 2023 with CLP 182.6 billion. This is an historical recurring result for ILC with an ROE that is close to 20%. This is an outstanding result. It's important to mention that we see the long-term return on equity for ILC more in the area of 12%-13%. This result represents close to 25% over the bottom line in 2022. This is part of what we call our growth and diversification turnaround process, which we think ended in 2022. In terms of the composition for this result or on the breakdown, you may see in this chart all the contribution from each subsidiary of ILC to this result. The main milestones, in 2023, in the case of Banco Internacional, we took control over Autofin, the auto finance company we acquired last year. We made a capital increase of CLP 25 billion over the year. This is something that was planned to support the growth phase of the bank. On Confuturo, we will speak a little bit about how the market or the annuity market recovery from the previous years, the performance of the alternative asset portfolio. We started, as we have mentioned in the past, a private equity plan investment 10 years ago, and we are now harvesting the maturity phase of that decision. In the case of the pension funds, we're still in the process of restructuring our operation in terms of being able to offer to our customers alternative products for their savings out of the mandatory saving products of the AFP. We started a branding process with Prudential. Prudential allow us to use their brand on mutual funds here in Chile and in Peru. In the case of RedSalud, we started a very strong alliance with the Cleveland Clinic to improve our operations, the quality of our processes. The network process or the network consolidation process that we started eight years ago is continue on track. In the case of Vida Cámara, you will see that we have developed during 2023 a new supplemental policies or insurances for individual. That's something new. This company was very focused on pool group products. We grew substantially in 2023, much more than the industry. We grew in terms of number of beneficiaries by 33%. In Consalud, you will see much better results due to the lower loss ratio. At the same time, this lower loss ratio was the result mainly of increasing fees, which at the same time, the main consequence of that was that we lost customers and the size of the portfolio of customers decreased by 20%. As I mentioned, if you think on ILC, we take a look, a very quick look since the IPO. On the first stage of the IPO, we named that phase business consolidation. We did some acquisitions, some restructuring, some divestments in order to focus our efforts on four segments of businesses. We enter into a five-year phase we call growth and diversification process. What we see for the coming years, it's a growth process. It's a growth stage, especially we focus on two of our businesses, Banco Internacional and Confuturo. For different reasons, Banco Internacional still have huge opportunities in terms of growth due to its size. In the case of Confuturo, as I mentioned it in the first or second slide, the market is recovering from a minimum or from an historical minimum size in 2020. Let's talk a little bit about on what is the composition of this result. As you know, and we have repeated this several times, one of our main goals over the years was to diversify our source of income. You see on the chart that we ended 2023 with four different blocks representing 20%-30% each of them. This was not the case 10 years ago. We were very dependent on the AFP, on the pension fund business. Something that we are starting to communicate is that on the long run, we are switching our goal of having one-fourth of each of the businesses contributing to the result to three businesses or three areas of businesses, contributing 30% each of them, more or less, and health 10%. Why is that? It's because our view is that the growth rate on the annuity and on the bank business is going to be higher than the other two businesses, pension and health. Let's talk a little bit about on each of the division or each of the businesses. On the banking area, you see on the top of the chart, the growth rate of the industry, which is the dark blue line, compared to the light blue, which is Banco Internacional. You see that Banco Internacional is very flexible. We grew a lot just before the pandemic. We catch up with the industry during the pandemic, and over the last 18 months, we again increase our growth rate much more than the industry, as you may see in the chart. Banco Internacional is growing much more than the market, than the industry, and it's very flexible in terms of adapting its strategy depending on the market conditions. Other relevant element, sometimes we want to compare our results and everything to the previous year. But if we take a couple of years, and we compare the bank since the acquisition at the end of 2015, you may see that on commercial loans, we multiply by close to four times our market share. On consumer loans, we multiply more than 11 times our market share, and in mortgages, 2.3 times what we were at that time. In summary, the growing process of the bank over the last 8 years, it's been outstanding, and we continue on the same path. Some metrics, on solvency indexes, we are very similar to the industry. On collateral coverage, we still have a strategy in which we have much more collaterals than the average of the industry. On non-performing loans, very similar to the industry. There is some gap there, but it is because of the collateral. Remember that the non-performance loans ratio consider the whole loan. There is no adjustment on collaterals. But if you adjust that 2.9% by collateral coverage, you will see that we are below the industry. In terms of credit risk, we improved on the domestic side from a single A risk rating to a double A and double A minus rating. From the international standpoint, we didn't have a risk rating, and now we are BBB+ and BBB by S&P and Fitch. Again, same story. We closed the gaps with the industry. We acquired a bank in 2015 that was far away from the industry in any metric, in any ratio you see. Now we are on the average of the industry, and in terms of performance, very close to the top performers of the industry. More numbers. We are growing on the retail segment. Remember that story when we start, a couple of years ago, was very focused on the commercial side, but we are open the room for the retail, with a different strategy, a digital approach. You may see that in 2022, we didn't have any checking accounts or just a few checking accounts on the retail segment. You see the numbers, the figures there. On consumer loans, the same thing. We doubled the size of the bank in 2023. In deposits, we almost doubled in one year in terms of number of customers, and in credit cards, we increased by 40%. All of this made under a strategy that is very leveraged on digitalization process, on digital products. Without entering into the classical retail segment strategies of investing a lot on branches, on salesforce, on brand. This is fully digital. We have a lot to tell you about how and what we have done on that side of the equation. On the commercial segment, we grew 40% in customers. Last year, 30% in line of credits, almost three times in cash management, and three times in Comex. Again, the more figures you see, the stronger the conclusion that the bank is on the right track under our strategy. In terms of profits, the gross operating result grew by 17%. A portion of that, which is in the light blue segment of the bar, is the acquisition of Autofin. But when you see the dark bar, you see that the core business of the bank, taking out or excluding the acquisition, grew. In terms of risk expense, very similar to the previous year, except, again, for Autofin, which is something new. On the efficiency ratio, we gained 160 basis points. When you see all of this reflected on the result of the bank, we ended up with a historical result of the bank, an ROE of 18%, more than CLP 55 billion of net income. We feel that the bank, again, is on the right track. We are supporting that, and we expect the bank to contribute to ILC more than what it is contributing now. In the case of Confuturo, the first relevant thing here, as I mentioned in the beginning, is the incredible recovery of the market. You see on the top of the graph, the gap between the annuity rate and the programmed withdrawal rate, which is one of the main variables that determine the size of the market. On the bars, you see how the market went down during the pandemic for different reasons, the withdrawals from the AFPs, the uncertainty, and people waiting for the decision of retirement. When the pandemic ended, you see that the people started to choose more annuities, the market grew, and we are in a market of USD 105 million, which is similar to the best years before the pandemic. We grew a lot again in 2023, 150% in terms of the annuity premium compared to an industry that grew 41%. Some changes we have mentioned in the past that are relevant for this market recovery. The first one is that the requirement for being eligible for annuity changed in January 2022. In other words, more people now are eligible for the annuity product. On the other side, a new product that was launched in 2022 is what we call the renta vitalicia escalonada. Renta vitalicia escalonada is an annuity in which you can increase the amount of the pension for the first 5 years, up to 2 times the annuity. In other words, it is a product that is very competitive to the programmed withdrawal, despite the gap on the interest rate you see as is the moment now. We are very confident that these markets continue to be a strong market, a growing market. With our flexible strategy, you see in the chart, of being able to sell more or less depending on the investment opportunities we see, you can see that our market share lies from 7% or 8% to close to 15%, without changing the company, without moving the sales structure, the sales force, which is key for our performance. This is another way to explain what I was mentioning. When you see the evolution of the channels we use to sell annuities, you may see that we increased a lot what we call the direct channel. This direct channel is a channel in which the customer goes directly to the company through the call center, through a branch, through the website, without an advisory, without a sales agent. This is something good for the customer because the pension increased. There is no fee, there is no commission on that. On the other side, it allows us as a company to be more flexible and not to be so dependent on the sales agent. You may see that the company in 2018 had close to 300 agents. Now we have 80. We sell more annuities now than five, six years ago. To the right, another key element of the company is the efficiency. We doubled this company in terms of AUM since the acquisition at the end of 2013. When you see the SG&A in real terms, in Chilean UFs, which is the dark blue bar, you see that the company SG&A is exactly the same over the last six, seven years, even though we are managing more than double or more than twice the size of the AUM of previous years. When you translate that to SG&A over AUM, in other words, how much we are spending based on the size of the AUM, you may see that we improve in terms of the efficiency. We were spending 66 basis points over AUM in 2018. Now we are spending close to 40 basis points. All that gain in terms of efficiency goes directly to an improve on the spread we are making on this business. In terms of investment portfolio, I would say that the main changes or the main reallocation of this portfolio were done on previous years. We are now in a phase that is more fine-tuning. We see opportunities on the real estate side. We see opportunities on the lending side. With the current scenario of interest rates, we see much better opportunities even in domestic fixed income, which was not the case on the last two, three years. This has been key for the success of the company, trying to reallocate the assets, trying to invest more on stable assets, CPI-adjusted, with more yield than the domestic fixed income. When you go to the results of the company, this is a chart that shows the results since the acquisition. You may see that before 2021, this company or the long run of this company was on the area of CLP 40 billion. Now we see the long run of this company in the area of CLP 70 billion to CLP 80 billion, very similar to what was the case in 2023. 2021 and 2022 were outstanding years, very pushed by the result on private equities. We see more regular and recurrent profits on the coming years, on the coming months. When you see the ROE, we acquired a company that was making zero. We made some improvements, being able to reach 5%-9% of ROE. Now we are in the area of 12%-13% of ROE. So it's close to a bank, which was not the case before, and which is not usually the case on this industry. On the pension side, brief summary on our operation. We have presence in three countries, as you know, Chile, Peru, and Colombia. We are very market leaders in Chile in terms of size, in terms of segments. In Peru, our strategy there is to be very efficient. The performance of our funds, together with a very efficient operation, gives us the capacity or the ability to compete there. In Colombia, this acquisition was We took control of that company at the end of 2019. We have been working on a process with focus on redefining the commercial strategy. Remember that in Colombia, the disability and survivorship insurance is part of the business. We have done a lot of improvements on that, but there is still room for making that operation more profitable on the coming years. If you put these companies together, we are the second player in the Andean region with close to 4.6 million affiliates and AUMs of close to $70 billion. Let's take a look. There are a lot of figures there in this chart, but some comments on Chile. Chile is a mature business. We are market leaders, but even though we are market leaders on this mature business or industry, we were able to increase the taxable income per contributor. In other words, the strategy that Habitat started 10 years ago of moving to mid-to-high income customers is continuing to work compared to the industry. We are not growing in terms of contributors. Why? Two reasons. One is because of the auction of newcomers to the labor market. Remember that in Chile, since '09, there is an auction every 2 years in which all the newcomers to the labor market go to the lowest fee AFP that won the auction. So that makes us very difficult to gain organic growth. On the other side, more than the number of contributors, what we focus on is the taxable income of the total contributors, meaning that if we lose one contributor that is making CLP 1,000, and if we lose two contributors making CLP 1,000, and we gain one contributor making CLP 2,000, that's better for us. When you see that in terms of the number of contributors, it's not a good figure, but when you see that in terms of the income, it's a good news. Efficiency, we are the most efficient operation in the country. This is a very recent strategy focus of Habitat, the efficiency. When you see all of that translate into the profits, excluding the reserve result, to avoid volatility on the reserve, you see that the income of Habitat Chile increased by 9.5%. Some comments on Peru and Colombia. On Peru, unfortunately, withdrawals in Peru, remember that in Peru we charge on AUM, hurts us as all the companies in the industry. Peru now is in the middle of a seventh withdraw process that is expected to be approved. We don't know, but it's expected to be approved. So every time you have withdrawals, you have less AUM. Given that we charge based on AUM there, the revenues move down. In terms of Colombia, we increased the revenues on 2023. Remember that in Colombia, the fee is the same for all the companies. It's 3%, but the result of our commercial strategy and the result of our capacity to restructure the portfolio of customers is giving us good results. If you put everything together, the operation of Peru and Colombia on 2023, in Peru were very similar to what they were in 2022, and in Colombia, a little bit lower, given to legal expenses that are arising and arriving from different cases on customers. Colombia is a very judicialized country, which is hurting us. In terms of the project, we have two focus on growing. One, a potential product market, as we have mentioned in the past, and the other one is the development of voluntary products on the region. In Chile and Peru, we are starting to use the Prudential brand. We are developing an asset management company. It is an organic growth. It is going to take some time. As we have mentioned in other opportunities, we do not expect this to be relevant in terms of the bottom line, but it is a very strategic movement based on being able to capture customers that they want to go with the voluntary savings for different investment alternatives other than the five funds offered by the AFPs in Chile and the three funds in Peru. On the health side of the equation, I will switch to Rosario to talk a little bit about RedSalud, Consalud, and Vida Cámara. Thank you, Pablo. Hi, good morning, everyone. As Pablo said at the beginning of this presentation on the health sector in RedSalud, we had a strategy. Sorry, Pablo, can you switch? Thank you. We had a strategy based on four phases. Three of them already took place in the past eight years, and now we are moving to phase 4, which is the consolidation of the healthcare network, with the focus on having the same user experience all across the network and also in all the medical processes. So the path and our vision to 2025 is more or less the same that the company has been performing and putting in place in the past eight years. In terms of EBITDA and EBITDA margin, the company has moved from a CLP 30 billion or CLP 40 billion neighborhood in 2016, 2017, to a neighborhood of CLP 70 billion in the past three years, which has shown also a very steady performance in these years, which also has a contribution in net profit, as we will see in the next slides. In terms of activity levels, as you can see in the two graphs above on the left side, medical consultation and images, which are mostly related to outpatient services, RedSalud has shown about 5% increase in activity, which also has had a contribution in terms of revenues and EBITDA. As you can see, we have a decrease in surgeries compared to 2022. We have to remember that 2022 was a year which shown an increase on activities due to all the lack, due to the pandemic of 2020 and 2021. So it is a higher base of comparison. Also, we have seen a change in the complexity mix in 2023, which partially offset the decrease in activity in terms of premiums. In the graphs in the below part of the slide, you can see the outpatient and dental centers which showed an increase in EBITDA. We have been performing well also in hospitals in Santiago and regional hospitals, with marginal decreases on EBITDA margin due to higher cost increase, mainly due to personal expenses, because they are driven by inflation and real adjustments. These are very intensive in human capital. It is an industry that is very intensive in human capital. On the insurer side, as you can see on the graph on the left side of the presentation, RedSalud shifted its mix from private health insurance, around 50%, now only representing around 40%. The increase was mainly in the public health insurance, which is FONASA, that now represents around 45%. We think this is a shift in the mix of the company that was partially due to the pandemic, which has sustained in 2022 and 2023 and shows that RedSalud is a good substitute to a public health network, and also has proved to be very cost-efficient in terms of operating in this segment of premiums. When we see RedSalud before this shift in the strategy in 2015 compared to 2023, the company has almost tripled the EBITDA generation, and the mix has shifted, taking more protagonism on outpatient and dental centers. Also the company has shown an improvement in the hospitals in Santiago due to investment they performed in the past and has shown profitability in the past years. On the insurance side, here you can see a graph which shows the evolution of beneficiaries from Consalud and Vida Cámara since 2014, where Consalud represented around 80% of the mix. As you can see in 2023, this mix is almost 50% each of the two companies. As Pablo mentioned in the beginning of this presentation, on Vida Cámara's side, the company showed a growth above 30% on beneficiaries and also in premiums. On the other hand, Consalud showed a drop on beneficiaries around 20% due to higher cost for beneficiaries. As you can see, Consalud is number three in terms of beneficiaries and contributors in the market, and Vida Cámara is number four. The company has shown a leadership in this industry, considering the high increase that we already mentioned in the beneficiary space. To close this chapter, here you can see how the whole health sector in the company is composed throughout the years. In 2023, we reached CLP 48 billion in terms of net profit, with a higher composition or participation of Consalud in this net profit. RedSalud, around CLP 15 billion, and Vida Cámara around CLP 1 billion. Just to close, as we said before, RedSalud is still showing higher levels of demand on the outpatient services with a reduced inpatient activity, but a more complex mix, which has shown also very good results in terms of EBITDA and net profit. On Consalud, we had higher revenues due to GES premium adjustment, and this has also an impact on lower gross ratio. We also saw a reduced medical leaves cost, which has been a trend all throughout the year. On Vida Cámara, as we said, beneficiaries grew over 30%, and we had higher claims compared to 2022. But the company has shown very good performance throughout the year. Thank you, Rosario. Let's move on to some data and some information on our financial position. As you know, we have a very structured and well-organized amortization profile. Our strategy is to have mainly four sources or potential sources of funds. One is the domestic banks. As you may see in the chart, we only have one bank loan going around that is vesting at the end of this year. We have domestic bonds. We have the 144A bond that was placed in the market two years ago. We also have a potential access to the private debt market in Europe and other countries that is developed. So we are very flexible. We have a lot of room for potential financing each of these sources. In terms of net financial debt, it's very similar to the one we had in the previous year. As we have mentioned over the last, I don't know, five, six years, we don't have any plan to increase our net financial debt. We want to keep these levels of debt that gives us a net financial debt to equity ratio on the area of 0.3 times. We have a lot of liquidity. The liquidity is coming from three different sources. One is the funds we still have in cash or in liquid assets that came from the placement of the 144A bond two years ago. The use of proceeds of that bond mainly is to refinance debt, which is what we have been doing over the last two years, and we're still in that process with those funds. On the other side, there is an investment portfolio. What we call an investment portfolio is a very low-risk fixed income investment portfolio on Chile. It's a very historical portfolio. It's around USD 80 million, and what we call cash and equivalents are gaps between the dividends we are receiving and the dividends we are paying to support future developments and future capital or equity needs that our subsidiaries may have. In terms of the performance of the stock, you know that 2023 was a very positive year in terms of the recovery of the economic value of the company. If you compare the performance of our stock to our companies in the market, it's the top performer of the year. If you compare the performance to the index return over the year 2023, it was more than six times the return of the index. Dividends, we just announced on Tuesday, we released the proposal from the board of directors to the shareholders meeting in terms of dividend. Our plan is to pay a second dividend based on 2023 results of CLP 450 on top of the CLP 150 we paid last December, to end it up with CLP 600, which is a dividend yield of 6% on the existing price. So we are still in the same track of having a dividend yield above the dividend yield of the index, which is the green line on the chart. The other relevant element is that if you take and put together all the dividends we have paid since the IPO, without including the one we announced, or the proposal we announced this Tuesday, we have paid close to 80% of the value of the stock on the IPO. So we are still in the same commitment and the same delivery on the promise we made on being a very good dividend yield payer compared to the market. Some wrap-up and conclusions on 2023, on the coming future. When you see our main plans and goals on each of the subsidiaries, you see that in Habitat, as I mentioned, a potential fourth market is something that we would like to. Voluntary saving products, continue developing the offer outside the mandatory saving business. In terms of the Andean region, we still see opportunities of consolidation on sharing best practices and gaining some synergies out of the three operations we have. Confuturo organic growth is there. It's a consolidated industry. We are very strong there. We have a strong market share, strong size, strong efficiency that makes us very positive on taking advantage of this growing market. Investment is always the main variable for that business, so we're still looking, and we are continuously looking for value on the spread. As I mentioned, efficiency is a key to succeed on our strategy on Confuturo. Banco Internacional, we still see a lot of room on commercial loans, growing on that segment. Again, the market and the industry is continuing a consolidation process, but very concentrated. So we see a lot of room for a niche bank as we are. The digital approach to our customers is there. Probably, the main challenge is to promote and to do more marketing on the products we have, but the solutions from a technological standpoint are there and are strong solutions. We are always looking for potential inorganic growth, given the size we have. On health, as Rosario mentioned, we're still in the process of the consolidation of the network. The Vida Cámara development over the last year is a very relevant proof that we are flexible and we are prepared for regulatory changes, especially in that industry. The alliance with Cleveland Clinic, I would say that's a great starting point to continue thinking on other alliances or to develop more the alliance with them. This is a starting point, but we have a lot of expectations on the coming future and what we can do and develop with them on the coming years. So thank you for being here. We are very confident on the company. As we mentioned, we are very confident on the coming future. I would say that we are proud of our results of 2023, which, as I mentioned, are the top results of the company during its history. I don't know, Gustavo, if we have some questions. Hi, Pablo. Thank you for the presentation. There's a question from Donovan Keith. He asked, "What are your thoughts on the current pension reform in Chile and its impact on your company? Well, the pension reform, as you know, there are two key elements on the pension reform. One is the ownership of the increase on the contribution rate, or in other words, how much of the increase on the contribution rate is going to individual accounts, and how much is going to subsidize pensions. The other key element are the reforms to the industry, or to the way the industry is organized. On the end of January, some elements of the reforms were approved on the lower chamber, and it moves to the high chamber. But the heart of the reform, which is, again, how much on the increase on the contribution is going to individual account and how much not, was not approved. The reform that enter into the high chamber is, let's call, a shelf. Meaning that the elements on what was approved on the lower chamber are not enough to have a discussion. My view is that the discussion somehow is going to restart or to reset on the high chamber. The other element is that the support on the ownership of the increase on the contribution rate is very, very strong. Any poll you see on that, you will see that 70%-80% of the people want the money on their own account. They want solidarity, but without their money. They want solidarity with taxes. That's an open discussion. But if you see the news, if you see how the Congress is turning and is speaking on this, I would say that more and more, the center to right-wing political bloc is very committed to protect the ownership. Why is so important that? Because if there is no agreement on the ownership, it's difficult to think on a reform. Okay? Then we are entering into an election process at the end of the year and then next year. The discussion is going to continue on the high chamber. It's going to take time. This is not something private. This is in the news, that the new president of the Labor Commission from the High Chamber mentioned that given the type of bill that was approved from the Low Chamber, they need to reset the discussion, they need to hear experts, and they will take the right time and the proper time to do that. Gustavo, you're on mute. Yes. Okay. Thank you, Pablo. There's another question regarding the mandatory health insurance. The question says, "Could you please provide us with an update on the regulatory situation regarding mandatory health insurance? Well, again, if we put ourselves at the end of January, in this case, it's the opposite way because it was the High Chamber. The High Chamber approved a law, and it was delivered to the Low Chamber. Different from pensions, the law that was approved in the High Chamber is very complete. The discussion in the Low Chamber is being focused on details, and some indications and details to the law that was approved in the High Chamber. Where are the main areas of discussion? One, remember that there is a way to calculate a return that we don't share the criteria, but it's the law, it's the justice that agreed that, to return some charges we made to our customers over the last 3 years based on what we call the risk factor table on the way we apply that, or the industry applied that. There are different ways for that calculation. One way is to do the calculation on case by case, and the other way is to think on a portfolio of customers or a pool of customers and recalculate these fees based on the pool. The difference between these two ways or these two approaches for the calculation is CLP 450 million to the industry on one side and CLP 1.2 billion or CLP 1.4 billion on the other side. So in the High Chamber, what was approved was the way to calculate this more similar to the CLP 450 million. After that, a group of senators from the government coalition, went to the Constitutional Court, arguing that this part of the law was unconstitutional. The Constitutional Court delivered the result of that a week ago or 10 days ago, and they agreed that it was unconstitutional, not the calculation. It was unconstitutional, this article of the law, because this article was not supported by the government, was supported by the High Chamber. In Chile, all the matters related to Social Security are exclusive from the government. That's the result of that case on the Constitutional Court. It's not that they made an opinion on the way that calculation was made. They made an opinion on the way that article on the law was introduced. So with that, we return to the discussion on how is going to be the calculation. That's part of the discussion that is being taking place now. Last night, the government introduced new articles to the law. I would say that the most relevant is one related to, after doing all these recalculations on the price or the planned price formula, there is a cap on the price. Nobody can pay more than 10% than that they were paying a year and a half ago after applying all these adjustments. I would say that's the main one. What's the calendar for this? The voting will start next week on the Low Chamber. Given the dynamics on some parts of the law that were not approved, some were approved. So given the dynamic and the, let's call the legal or the Congress techniques, this will ended up on a mixed commission. A mixed commission is a commission of 10 congressmen, five from the High Chamber, five from the Low Chamber, that they, at the end, will agree on a law. Sorry for being so confusing on the explanation, but after this process, what we expect is that we will have a law at the end of April, beginning of May. Okay? We expect this to be a hard law. We, as a company, we are rethinking and redefining the strategy of Consalud to face this new law. Why the timeline is that, remember that there is a resolution from the Supreme Court that forced the government to implement this resolution as of mid-May. So if there is no law, they will have to ask for an extension. Our view and our guess is that it's difficult to have or to receive an extension from the Supreme Court, given that the last time they gave an extension, the message or the wording on the resolution was very clear on, it's not like this, but very clear in terms of this is the last one. It might be an extension, but probably if it is the case that there is still a law approved, but they need some days or some weeks to do the publications and to all the final legal process of a law approved by the Congress. In summary, the discussion is being taking place. The voting process is going to start next week, and we expect to have a law at the end of April, beginning of May. Gustavo? There's no further questions. Okay. Thank you for everything today. Thank you all for attending this conference call. If you have further questions, feel free to contact our IR team. Well, thank you again for joining us, and as always, very open to meet and to address any question you may have on the company. Have a great rest of the day. Bye, everyone. Thank you very much.