StoneCo Ltd.

Good afternoon, ladies and gentlemen, and thank you for standing by. Welcome to the Stone Company fourth quarter and fiscal year 2020 earnings conference call. By now, everyone should have access to our earnings release. The company also posted a presentation to go along with this call. All materials can be found at www.stone.co in the investor relations section. Throughout this conference call, the company will be presenting non-IFRS financial information including adjusted net income and adjusted free cash flow. These are important financial measures for the company, but are not financial measures as defined by the IFRS. Reconciliations of the company and non-IFRS financial information to the IFRS financial information appears in today's press release. Finally, before we begin our formal remarks, I would like to remind everyone that today's discussion might include forward-looking statements. These forward-looking statements are not guaranteed of future performance, and therefore you should not put undue reliance on them. These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from the company's expectations. Please refer to the forward-looking statements disclosure in the company's earnings press release. In addition, many of the risks regarding the business are disclosed in the company's Form 20-F filed with the Security and Exchange Commission, which is available at the at www.sec.gov. Please note that this event is being recorded. I would now like to turn the conference over to your host, Rafael Martins, Investor Relations Executive Officer at Stone. Please proceed, sir.

Rafael Martins Thank you, operator, and good evening, everyone. Joining us here today, we have Tiago Piau, our CEO, Lia Matos, our COO and Chief Strategy Officer, and Marcelo Baldin, our CFO. Today, we will present our operational and financial metrics for the fourth quarter and 2020 results. I will pass it over to Thiago so he can share with you the main highlights of our performance. Thiago?

Thank you, Rafael, and good evening, everyone. Thank you for joining us in our fourth quarter 2020 earnings call. Before we dive into our 2020 results, I want to talk a little bit about our strategic direction and the moat of StoneCo. As a client-centric company, we are always trying to assess how we can help our merchants to become better every day. I believe our mode is about empowering small and medium businesses to win through three important strategic steps, two of which we are already executing well, and the third one is becoming a new dream for us. First, we want to delight our clients and gain their trust by offering a complete set of financial solutions for a world-class technology and service, replacing their existing banking relationship and becoming the dominant financial provider of SMBs in Brazil. Our Stone and Pagar.me teams are working hard to accomplish this goal every single day, building an amazing culture of talented people and client obsession. Second, we want to offer enterprise-level workflow tools to empower our clients to better manage their business, drive the operational efficiency, and connecting them to online channels so they can sell more. We started the second phase of the business almost two years ago, and we are happy to see great evolution of our team towards this direction. The investments we made in the acquisition of Lynx put us in a unique strategic position to achieve this goal. We are working hard to make sure the team achieves the same level of client satisfaction and discipline execution we are able to build in Stone and Pagar.me. The third strategic step, and this challenge we still have to tackle, is to answer a very simple question. How can we drive more customers to our merchants? How can we incentivize consumers to shop in our merchant base? We can now start dreaming about answering this question, and we know that data infrastructure, user experience, and technology integration between our businesses are key elements to make this happen. Moving to results, 2020 has been a year of great achievement, despite all the challenges imposed by the pandemic. I believe we balance discipline execution with important strategic steps, continue to deliver strong results. Our team did a great job, and today we are bigger and much better than we were a year ago. We continue to present strong profitable growth and long-term value generation. Moving on to the presentation, I would like to start on page four with client-based dynamics. We have significantly scaled our client base in many fronts. In payments, we posted on the fourth quarter a record quarterly net addition of clients, and we keep increasing investments, paving the way for continued acceleration in 2021. In fact, even with the negative impacts brought by the COVID-related lockdowns, we reached over 652,000 active payment clients in 2020, 2.4 times 2018 levels. On top of that, now we count on almost 114,000 clients in Tone, our solution to micro merchants, and we see very strong levels of growth in 2021. The number of clients with credit solutions grew to nearly 90,000, almost four times 2019 figures, and the numbers of open digital accounts surpassed 500,000. Eightfold the number posted in 2019, with over 133,000 clients using as the main settlement accounts. Lastly, the number of software clients in our ecosystem grew to nearly 390,000, almost three times 2019 levels. We have evolved fast in the convergence of our solutions. In 2019, 10% of our SMB acquiring clients used at least one other financial product offered by us. And by the end of 2020, that number jumped to 34%, with new cohorts presenting even higher numbers. Besides that, the percentage of clients using both our software and payment solutions also increased from 22% in 2019 to 30% in 2020. As Lia will discuss later in more detail, This trend is improving our unit economics on SMB clients, which is the reason why accelerating our client base is among our top priorities today. We had a record addition of TPV in a year, having added 81 billion of TPV in 2020, a similar level to the total TPV processed in 2018. In fact, the process volume increased over 150% in just two years, despite COVID impact in 2020. While we are committed to fast growth, and even though we are investing heavily in our business, in 2020, our adjusted net income grew 12%, with an adjusted net margin of 29%, despite all COVID-related impacts. We have also reported our record-adjusted free cash flow generation, which reached over 653 million reais in 2020, growing more than 57%. Finally, we are able to scale while keeping high customer service levels, achieving a first call resolution index of 94% and 91% of the calls rated as excellent by our clients. Stone was created to provide the best-in-class service for its merchants. Even with the businesses growing fast and gaining scale with additional solutions, we will never change the commitment we have with our clients. we will work hard to keep providing the best customer experience our clients can get every single day. With that said, I will pass it over to Lia to discuss our results in more detail. Lia?