StoneCo Ltd.

Good evening, ladies and gentlemen. Thank you for standing by. Welcome to the StoneCo first quarter 2023 earnings conference call. By now, everyone should have access to our earnings release. The company also posted a presentation to go along with its call. All material can be found at www.stone.com.br on the investor relations section. Throughout this conference call, the company will be presenting non-IFRS financial information, including adjusted net income and adjusted net cash. These are important financial measures for the company, but are not financial measures as defined by FRS. Reconciliations of the company's non-IFRS financial information to the IFRS financial information appear 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 guarantees 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. In addition, many of the risks regarding the business are disclosed in the company's Form 20-F filed with the Securities and Exchange Commission, which is available at www.sec.gov. I would now like to turn the conference over to your host, Raphael Martins, VP of Finance and Investor Relations Officer at StoneCo. Please proceed.

Thank you, Operator, and good evening, everyone. Joining us today on the call, we have our CEO, Pedro Zinner, and our Chief Strategy Officer, Lia Matos. Today, we will present our first quarter 2023 results, discuss some recent trends, and provide an updated outlook for our business. I will now pass it over to Pedro so he can share some highlights of our performance. Pedro.

Thank you, Rafa, and good evening, everyone. I would like to say that I'm honored and excited to join the Stone team. And I would like to thank Thiago for all that he has done for the company and to ease my transition into the CEO role. I'm confident that Thiago will continue to contribute to our success in his new role as a board member. I'm also pleased to report that Stone has continued to build on its solid performance from 2022 and deliver stronger than expected top line and bottom line results in the first quarter of 2023. Let me provide some quick comments on the strong quarterly results and share some initial impressions on the company so far. In our last earnings call, the team outlined our priorities for 2023. I'm quite happy with the results achieved so far, which you can follow on slide five. Our first priority was to grow with efficiency. I'm pleased to report that we have exceeded our expectations on both fronts. We grew our revenues 31% year over year and deliver strong profitability with adjusted EBT of 324 million reais in the quarter, 22% above our guidance. As a result, we were able to deliver adjusted net income of 237 million reais, which was our best Q1 performance in our company's history. Our second priority was to generate cash. In Q1, we had strong cash flows from operations, and we were able to increase our adjusted net cash by approximately 500 million reais to reach 4 billion reais. Our third priority was to keep expanding our financial services business. As you can see, we have delivered a very strong performance in our MSNB segment. We grew MSNB TPV two times above the industry, accelerated net addition of clients in both payments and banking, and are in line with our plans to resume our credit business. we have taken significant steps on the credit side, having this burst to a small number of clients, but most importantly, we have improved many aspects of the product and operation that will enable us to grow our portfolio in a sustainable manner. I want to take a conservative approach towards the expansion of this solution and grow the portfolio depending on market conditions and the completion of the tests we are doing. Finally, we were able to achieve this growth and evolution with a significant increase in monetization, with take rates reaching 2.39%, an 18 basis point improvement over the last quarter. The fourth priority was to evolve our software business. On this front, results were below my expectations. The team is working hard to build the foundations that will enable us to deliver a unified experience to our clients, integrating software and financial services, and becoming the one-stop-shop solution for small and medium Brazilian retailers. We're making progress integrating and building of those capabilities, but we are not there yet. In our software sales, our revenue growth was hurt mainly by a reduction in ad spending, by some of our enterprise accounts, and our EBITDA margin was also impacted by an increase in selling expenses. Throughout the rest of this year, I want to put a strong focus on our team integration, cost discipline, and streamlining of our software portfolio. And finally, our fifth goal is to build a fit-for-purpose organization that will enable us to deliver on our long-term priorities. we have to make sure our organization is properly equipped to withstand the additional pressures that come with a high-speed growth. I don't think this guarantees success, but I believe not having the right resources in place is a leading indicator of failure. As part of this process, I want to welcome Luiz André Barroso as our new board member. His experience as a Google Fellow and a seasoned professional in the tech industry will help us on our path to differentiate ourselves and lead through innovation. Now I want to share some additional thoughts on the company and my experience in the role so far. The first thing I'd like to highlight is the inspiring and fantastic people I have met over the last couple of months. Whether I've been spending time with teams in our hubs at our distribution centers or within our offices, the great ideas, the positivity and enthusiasm for the work we do is really inspiring. I believe the superior talent in this company will continue to be a great driver for our long-term success. The second is that we have significantly improved the company's governance structure and management systems over the past year. I see the company doing a better job of setting more clearly defined goals, cascading this to different layers within the organization more effectively, and linking compensation more closely to our performance. This is improving decision making, and I see that we now have a better understanding of the key value drivers affecting our business. This is certainly a continuous process, but I believe we now have better structure to maximize value and returns over the long term. The third is the strong foundation of our client-centric culture. I think a key driver of Stone's success during its journey has been its ability to identify and ease the points of friction that MS&B clients have with traditional financial institutions. This, combined with the last mile in distribution capabilities that Stone has built over the past few years, has become a significant competitive advantage that has enabled Stone to disrupt the market. I think these same attributes can also extend our value proposition into banking and credit, and longer term, extend our competitive advantage in our software business by solving the vertical specific complexity of our clients, and creating a more cohesive ecosystem of integrated software, hardware, and financial services. For the short term, I believe that focusing and excelling on the basics, we will emerge stronger and more resilient. For example, our cost management initiatives are already improving our operating leverage and our pricing discipline is impacting our profit margins. Longer term, I am working with our team to design our strategy through 2030, setting clear goals and execution path ahead. We will provide you with more details on this new long-term plan at an upcoming investor day that we're working towards, and we will share more details of the event a little later this year. And now, I'm going to pass it over to Lia. who will discuss our first quarter 2023 performance and strategic updates. Lia.