Arcos Dorados Holdings Inc.

Good morning, everyone, and welcome to the Arcos Dorados third quarter 2019 earnings call. A slide presentation will accompany today's webcast, which will be available in the investor section of the company's website, www.arcosdorados.com. As a reminder, all participants will be in a listen-only mode. There will be an opportunity for you to ask questions at the end of today's presentation. and today's conference call is being recorded. At this time, I'd like to turn the conference call over to Patricio Esnaola, Director of Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and thank you for joining our earnings call. With me on today's call are Marcelo Rabas, Arco Dorado's Chief Executive Officer, and Mariano Tanembaun, Chief Financial Officer. Please turn to slide two. Before we proceed... I would like to make the following safe harbor statement. Today's call will contain forward-looking statements, and I refer you to the forward-looking statement section of our earnings release and recent findings with the SEC. We assume no obligation to update or revise any forward-looking statements to reflect new or changed events or circumstances. In addition to reporting financial results in accordance with generally accepted accounting principles, we report certain non-GAAP financial results. Inventors are encouraged to review the reconciliation of these non-GAAP financial results as compared with GAAP results, which can be found in the press release and audited financial statements filed today with the SEC on Form 6-K. Our discussion today excludes the results of the Venezuelan operation, both at the consolidated level as well as for the Caribbean Division. due to the country's ongoing macroeconomic volatility. For your reference, we include a full income statement excluding Venezuela with our earnings release. I would now like to turn the call over to our CEO, Marcelo Rabach, who will begin his remarks with slide three.

Thank you, Iñaki, and good day, everyone. We delivered another quarter of strong volume and sales growth. Our nearly 13% increase in comparable sales was stronger than it was in the second quarter, well above blended inflation. In a scenario where GDP growth has been revised downward in many key markets, we drove traffic levels higher and saw average check growth across most of our countries. Even in dollar terms, consolidated sales increased nearly 4%. despite significant FX pressure during the quarter. Our performance was particularly strong in Brazil, where we delivered 10.8% comparable sales growth, which was more than three times local inflation. Again, we gained additional market share and outpaced the food service sector. Importantly, we are maintaining this momentum into the fourth quarter. Our knowledge division also performed well. We are very pleased that Mexico produced its tenth consecutive quarter of sales growth and its third year above inflation, a result of a combination of initiatives that have gained traction in that country. As we noted during the previous earnings call, our performance is more about sharp and disciplined execution of our three-pillar strategy and leveraging our market-leading brand than about market conditions. Our investments in EOTF restaurants continue paying off, with sales lift in the high single digits. As of the end of the third quarter, we had 510 EOTF restaurants. By the end of the year, we will bring EOTF to a total of 10 countries. Delivery and digital, two other key components of our omnichannel guest experience, also contributed to our top-line growth in the quarter. And we continued expanding our already dominant footprints. with the addition of 70 new restaurants over the last 12 months. With regards to profitability, our adjusted EBITDA margin expanded further. Excluding the one-time tax benefit that we recorded in last year's quarter, our margin increased 120 basis points at the consolidated level. In addition to operating leverage generated through top line growth, our machine benefited from continued efficiency gains in payroll and many other cost lines. Before turning the call over to Mariano to discuss our performance in more detail, a brief word about our operations in Chile. a number of our restaurants were affected by the recent protests across the country. While we are working to normalize operations again at the damaged restaurants, our main priority right now is the safety of our colleagues and customers. In Ecuador and Peru, our operations were also affected by last month's protests, although only for a brief period, and operations resumed back to normal. Mariano, please go ahead.