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during the earnings call. Related to business perspectives, forecasts and operational targets at SAE represent assumptions and beliefs of the company as well as information currently available. Future statements are not a guarantee of performance. They involve risks, uncertainties and assumptions because they refer to future events that depend on circumstances that could or not occur. Investors must understand the economic conditions in the market and other operational factors could affect the performance in the future at our site and lead to results that utterly differ from those in such statements in the future. Now I'll pass the floor to Gabriele Alu, the Investor Relations Director at our site. Thank you, Rodrigo, and good morning, ladies and gentlemen. Thank you so much for participating in our earnings call for the first quarter of 23 at SAE. I'd like to present the executives present here. So we have Belmiro Gomes, our CEO, Dani Sabag, our CFO, Vladimir Desanjos, our Operational and Logistics VP, and Anderson Cachilho, our Operations VP. Before we start the presentation, I'll pass the word to Belmiro for his initial remarks. Belmiro? Thank you, Gabi. Good morning, everyone. I wanted to thank you all for your presence in the first quarter of 23. So, of course, this is a quarter that is super important considering the last general shareholders meeting where we had a shift in the controller and now the company has no defined control. So, true corporation now. And on the 8th now, we'll have the new board taking place, the the board was elected in the last general shareholders meeting. So we have very skillful professionals that are going to help and support the company during this transition period. So this, of course, helps us with the governance issues, but also contributing strongly to the business. And as I keep this history of growth that's so high, over 30% in the first quarter, a total growth of 33% with an important highlight to the same store, the sales base. And so we had important contributions with the expansion in the stores that were converted. And so

So we have some important share gains of almost 2.4.

It was the biggest share ASE has ever had in all of its historical track record. And we add a volume of sales of 4 billion reais compared to the first quarter of the previous year. So I also wanted to highlight our special thanks to the store teams, that are in the day-to-day operations, working with almost 100 million people that go by all of our stores in this first quarter in many different operations. And the company had a significant increase in the flow with over 16 million tickets. And overall, these added up to 16.6 billion reais, the 33% growth, then a strong contribution in the expansion we had. So I want to highlight that we've been keeping up a balance point between our growth and sales and the administration or management of the same store sale part. And this is a relevant amount, so it's the biggest amount we've ever had of stores, new stores at the same time. We have 60 new openings that took place in 2022 and over 29 openings in 2021. So this balance point in the ramp up and the operation we believe was very strong and so the gross margin even despite this amount of stores continues to be super stable compared to the previous year with an increase of 0.1 so this represents uh the fact that the new units uh our new stores are not being detractors or confiscating margins another highlight is the discipline for these expenses so the cash and carry operation is a low cost business. So when we look at the variation of expenses that we've had compared to the previous period, it's a lot more related to this bigger amount of stores. So it's natural that a bigger amount of stores would have this during this ramp up period. a level of operational expenses that's higher due to the amount of personnel or the media that we work on or all of the different activations that take place in the store maturity. But in our perspective, we did have a balance point in these expenses. And with this, the operational aspects of the business has been extremely stable. The 33% growth in sales also brings an important increase in the gross profit and EBITDA margin that's relatively stabilized. with a 0.3% drop and a small variation, considering that most of our store network, about 40%, was already open with the recently opened stores in the last two years. So the net income has an impact, of course, due to the cost of the carryover of the debt. We're going through this period where you have a very dangerous combination of interest rates, the highest real interest rate in the world with food inflation at about zero, which generates pressure at a moment where the company's going through this growth and an important growth trend for growth. And so we opened up another three stores. These are three more conversions, adding up to a total amount of sales of 266 stores. in all of Brazil. And so we have another 28 stores under construction. We have 13 stores from the conversions of the hypermarkets that were acquired and 15 organics, which were already expected. And so they'll be opened throughout 2023, bringing in even more contribution or acceleration in this growth process for the company. And of course, completing the hypermarket conversion project as well. We can advance so now moving on to the project with the extra stress, it was the biggest conversion project. For stores and when we talk about these conversions from hyper markets into cash and carry stars, it is a conversion that's really impacting so it's different than when you convert. like a brand to another brand or cash and carry to cash and carry conversion from a hypermarket to cash and carry operation requires structural construction work and refurbishing the model of the acquisition of the commercial spots. We just bought the commercial spot. We have no liabilities or risks involved in the operation from a labor contingency perspective or personnel perspective. So the stores were emptied out and we didn't have any furniture left or anything else. They were completely remade. Others are still under construction and these stores have only like five months of operation, basically. So during the first quarter, we were mainly focused to the stores that were open in 22 that needed to complete this process with the ABL and galleries aspects of these stores. Just the extra stores, for example, that came from last year, they had about 727 shops and an ABL area. That's really big as well. And so the adhesion of stores and the shops in these stores is really big. We have 46% vacancy because we're just finishing the construction work now. But as these other businesses occupy these store areas in our store, this will attract more customers as well. So these stores are performing in line with what we estimate for this extra project at about 70% of this sales percentage. So even with less than five months of operation, these stores have already been delivering a sales level that's above the historical average in the entire Acai network. And they've performed close to about 22 million reais of monthly sales in the first quarter. which is a quarter that, as we all know, is a quarter that's very challenging. And the positive point was that, as we highlighted in the beginning of the project, these stores have a EBITDA margin that we never have in the organic stores. So this was already an important contribution to the five months of life in the first quarter after the opening cycle of 5% after the IFRS 16. perspective that we have in the other store park or network. So sales are at 2.2 times compared to what extra had before and 3.2 when we just compare the food perimeter since the hypermarkets as we all know have a real high sales of electronics and home appliances that the cash and carry operation normally doesn't work with. So We understand the anxiety towards this project. We understand the anxiety or the immediate approach that this project could maybe bring. But just as any other project for growth, first you need to invest, then you can reap. So just as all of the growth processes, you always have this investment phase and then the maturity. And our stores are recently opened, so they're still going through this curve. with a maximum and minimum levels expected. So we've been following this process and we reinforced our credibility and our different points and how these stores are going to contribute strongly to SAE and how they're going to be a very important differential in the future, considering that they are in regions that have high density. So, of course, with this kind of magnitude and this amount of stores, when we take a look at the tickets added in these stores. We have about almost four or five million custom tickets more per month. And of course, each store requires this kind of adjustment in its ramp-up curve. So adjustments when it comes to the margin assortments and competitive advantages, depending on the regions where these stores are part of, are included. So the maturity curves follow along. Of course, the difficulties in the market. We have a moment in the market that's more challenging. with consumers a lot more focused on basics. And so this, of course, this affects the overall store network in the company. So we can move on to the next slide. And I'll pass this to Tania as she can highlight the adjusted EBITDA and the net income. And then I'll cover this a little more up ahead. Thank you, Belmiro. Good morning, everyone. So moving on here to the presentation. When we see slide four, you can see the EBITDA graph and the analysis of important increases, 200 million year over year. And I wanted to mention three important points on this performance. So first, what Bermuda already mentioned that's important to highlight is the expansion. So a margin that we consider to be very resilient, considering this strong expansion in the past 12 months when we opened 59 stores. So we would expect a pressure that's even more significant, but the performance is really unique when it comes to the conversions that reach maturity quickly or even the quality of the organic stores we open. This really helps to keep up this level that we consider to be very sustainable up ahead. So about the pre-op expenses with this expansion, we always highlight that we have over 10 beeps in this quarter of expenses that are related to the stores that were open. So when we take a look at this from a recurring perspective, the EBITDA reported that would be a pressure of about 20 beeps and not 30 beeps. And when it comes to this pressure point in the margin, it's important to mention that in the second quarter, we had some margin pressures at about 50 beeps. And the third and fourth quarter. So what I want to say here is that the pressure in the margins in the first quarter from a sequential perspective, quarter per quarter is a lot lower than what we noticed in the second semester of 22. Moving on to the next slide. We understand the financial earnings and cash generation, so the earnings were 630 million, equivalent to 4.2% of the revenue, and then excluding the lease interest at about 200 million, we have a net expense of 4.28 million, representing this 2.78% of the sales. So this earning that's affected by the CDI, it went up 34% and we had a CDI in the quarter of $243. to 325, and this is the main impact, but we also have a significant volume of the average debt in the quarter, which is a little bit higher than the debt that we had in the first quarter of 23 and 22, sorry, due to the fundraising we had to implement to be able to fund So the debt position was 10.9, but now it's 12.7 besides the interest that's embedded here. So when we look at the net debt, we end the quarter with 8.1 already considering the credit card receivables and we have a leverage level of 278. And that's when we bring in this graph here at the bottom part so we can show you that This level is really in line with the levels we've observed in the second and third quarters of 22 and in line with the expectations we have for everything we projected. in this huge expansion project we've been delivering. So even in the next quarters and the second and third quarter of 23, we'll be noticing a level that's very similar to the first quarter of 23. Everything is kind of under control. Everything's within the covenants we have combined with and agreed upon with the banks. We've been reinforcing this with Gabi in the meetings with Palmito and myself, but we want to make it very clear that we don't have any risks of not fulfilling our covenant. The deleveraging process is really keeping up to date with the calendar of this entire conversion project and expansion of the company, and that we foresee some deleveraging in the fourth quarter, really in line with the levels we've reached in the fourth quarter of 2022. So it should be a very similar level. And we wanted to transmit this kind of comfort to you. And while we're speaking about the cash generation accumulated in the past 12 months, We had a cash generation of about 3 billion, and this made it possible for us to fund all of our investments, including the payments for the commercial real estate. And when it comes to debt and cash generation, it's really in line with our estimates. If we consider all of the maturity of the 59 stores and the stores that are being... that are reaching maturity, the organic stores as well. And we see that above all of this, we have to reinforce that we have 22 stores in construction phase. And finally, to end my part of the presentation, moving on to the next slide with the net income, as we highlighted during the presentation, we have operational results that are very resilient, but of course, they still reflect all of these high investments that we've had in the expansion. And with this, this maturity expected, we want to highlight that the net income is really impacted by all of the maturity process that's in progress. So as Bominu mentioned, I want to highlight the issue with the organic conversions and the sales levels, the margin levels. All of this has been translated into greater productivity of sales per square meter, but also profits that in the future will end up reaping the quality of this expansion. So amidst this context, we reached a quarter with 72 million reais of profit or net income, which is really impacted by the scenario with high interest rates that we've been facing in the country. These are my comments. Now I'll pass the floor back to Bill Meadom. so that he can talk about our app and ESG.