Vinci Compass Investments Ltd.

Good afternoon and welcome to DaVinci Partners first quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session and instructions will follow at that time. As a reminder, this call will be recorded. I would now like to turn the conference over to Ana Castro, investor relations manager. Please go ahead, Ana.

Thank you and good afternoon, everyone. Joining today are Alessandro Horta, Chief Executive Officer, Bruno Zaremba, Head of Private Equity and Investor Relations, and Sergio Passos, Chief Financial Officer. Earlier today, we issued a press release, slide presentation, and our financial statements for the quarter, which are available on our website at ir.cintipartners.com. I'd like to remind you that today's call may include forward-looking statements, which are uncertain and outside of the firm's control. It may differ from actual results materially. We do not undertake any duty to update the statements. For discussion of some of the risks that could affect results, please see the risk factors section over 20F. We will also refer to certain non-GAAP measures and you'll find reconciliations in the release. Also note that nothing on this call constitutes an offer to sell or solicitation of an offer to purchase an interest in any venture partners fund. With that, I'll turn the call over to Alessandro.

Thank you, Ana. Good afternoon and thank you all for joining our call. This was the first quarter for Vinci Partners as a public company after our IPO earlier this year. We were able to generate very strong results as we continue to deliver solid returns for our fund investors. Nonetheless, the current market valuation of our stock, in our view, does not represent the actual value of our platform, our existing investments, and our very significant growth opportunities across the firm. So, in addition to announcing our quality results, we are also initiating a share repurchase program of up to 85 million reais, which has been approved by our board of directors. We are committed to delivering shareholder value, and this buyback program authorization reflects the Board's confidence in our current prospects and long-term growth. We believe that this program represents an accretive opportunity to deploy cash from our results in a way that should benefit our shareholders. Bruno will discuss the best purchase plan in more detail in a few moments. On to our financial results. Vinci Partners reported excellent results for the quarters with IFRS net income of 47 million reais, fee-related earnings of 50 million reais, or 88 cents per share, and distributive earnings of 47 million reais, or 83 cents per share. Our business is profitable and growing with strong operating leverage, long-term FRE and and distributable earnings margins continue to expand, and our relative fixed costs over AUM are decreasing year after year. We ended the quarter with 55 billion reais in AUM, which represents 45% growth year over year. Our very expressive AUM growth This quarter was a result of primarily two factors. First, we have probably one of our best quarters for fundraising in private market strategies. We raised almost 2 billion reais through five different fundraisings, of which two are new strategies we are very excited about in the real estate and infrastructure segments. for which we will continue to raise capital throughout the year. We also had the final closing for our private equity impact-focused fund, Vinci Impact and Return IV, or VRI IV, that reached the fund's hard cap of R$ 1 billion in the quarter, making it the largest impact-oriented fund in Brazil. VRI4 is extremely relevant to Vinci in two different levels. This fund raise represents R$1 billion of additional long-term, high-quality capital for our private market strategies and a new avenue of growth inside the firm. Additionally, VRI4 marks an important milestone within Vinci's ESG efforts. Since our company's inception, we were very conscious about the adoption of responsible investment and ESG integration in our investment decision process. Being a PRI signatory since 2012, and we remain one of the few alternative asset managers in Brazil with an impact-oriented private market strategy and an active ESG committee within our board, which really set us apart from competition. Another very important avenue of AUM growth was our IPNS business that raised over 3 billion reais during the first quarter of 2021. We have been very active in fundraising for new separate mandates for institutional clients, for which we provide allocation service ranging from specific mandates in predetermined asset classes or even the client's entire portfolio. We continue to see a very material opportunity for growth in this business and we still face very low competition in Brazil for this type of service. This quarter's fundraising is a clear result of the power of our brand in Brazil, of how we can launch new strategies and raise long-term capital. We just started a new branding project that will take place throughout the year with one of the most respected marketing agencies in Brazil, looking to increase brand awareness, especially among retail investors. The retail channels that we access through allocators and distributors in our public market vehicles have been growing at a very accelerated pace, representing currently 20% of our AUM. We took on this project looking to improve our communication with this type of investor, expanding our distribution capacity, and reaffirming our position as the top-of-mind brand for alternative investment. Moving on to our view regarding the local macro scenario, we believe that despite some recent volatility, Brazil continues to be an extremely healthy and supporting environment for growth in the alternative asset management industry. We have been impacted in this first quarter by a second wave of COVID-19 cases in Brazil, but COVID vaccinations have been accelerating as the priority group, which includes citizens of 60-plus years and other special situations, should be fully vaccinated with both shots in a couple more months. Both the population and the state and municipal governments have adapted to the pandemic, which allowed the economy to be less impacted in the second wave when compared to the first wave in 2020. Furthermore, new COVID cases have been improving markedly over the past few weeks, and the restrictions rolled out during the month of March are starting to be eased back. As for interest rates, as you can see in the chart displayed in slide 6, long-term real interest rates continue to be at low historical levels at the current 4% rate. We continue to hover at levels that are around all-time lows, and this continues to drive reallocation in local assets from fixed income into alternative asset management classes. What we are seeing now is really a transformation moment for us in our industry that has developed into a financial deepening revolution for all types of investors. Even with the expected rise in short-term rates starting to take place, we believe that at these current levels, the scenario continues to be quite constructive as institutional investors are still way below their actuarial targets and need to seek alternatives for diversification in their asset bases to improve yields in their portfolios. This is also true for individuals who are facing negative after-tax short-term real rates and negligible long-term real rates. We have not seen any change in the decision-making process of these investors so far, and we continue to benefit from local trends as our AUM continues to grow at a very rapid pace and Vinci continues to gain market share. Analyzing macro asset allocation figures, Brazilian AUM has more than doubled in the last five years, and we are seeing a significant change in investor profile with asset allocation moving away from fixed income into other investment classes. Even with an 11 percentage point decrease in relative allocation since 2015, fixed income still represents the biggest proportion of Brazilian capital allocation leaving great room for growth in alternative investments. Allocation to assets excluding fixed income in Brazil has been growing at a 21% CAGR since 2018, as we see the direct effects of the financial deepening revolution taking place locally. As a comparison, Vinci's AUM has been growing at a 41% CAGR in the same period, with first quarter 2021 year-over-year growth accelerating from that already high rate of growth. We believe we have been very successful in growing our business over the years, growing our market share in all investment classes, and we believe there is yet great room to grow within this large addressable market that is still in fixed income products. We believe we are only in the beginning of the shift of capital flows from fixed income towards alternatives, and Vinci Partners is the only Brazilian asset manager that has expertise in all the key alternative asset classes, which put us in a unique position to capture this movement in asset allocation. In addition to local trends, we also have access to a global capital pool that is currently substantially underrated in Brazil, in our opinion. Currently, offshore institutional investors represent roughly 25% of our AUM, and we see room for this fundraising vertical to grow. The combination of presenting a complete alternative asset management offering Sound governance and institutionalization and strong risk-adjusted returns in our products puts Vinci in a privileged position to be the partner of choice for offshore investors looking to deploy capital in Brazil. we are confident that we have the tools to seize this immense opportunity we see currently in Brazil. As we continue to provide the best returns and investment opportunities for our limited partners, we translate into results for our fellow shareholders. And with that, I'll turn it over to Bruno.