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Good morning everyone. Thank you for waiting and welcome to the earnings call for the second quarter of 2026 Al Sayyed al-Khajista. I want to highlight that if you need simultaneous translation, we have this feature available on our platform. In order to access, please select the interpretation button through the globe icon at the bottom part of your screen. Choose your language of preference, Portuguese or English. We would like to let you know that this earnings call is being recorded at the ir.sie.com.br where you can already find the earnings release. During the presentation, all participants will have their mics off. Soon after, we'll begin the Q&A session. To submit questions, please select the Q&A icon at the bottom part of your screen, write your name, company, and language, enter the queue. As you're announced, a request to activate your mic will appear on the screen. Soon after, you should activate your mic to submit all of your questions all at once. We also want to highlight that information and possible statements that could be made during the earnings call related to business perspectives, Forecast and Operational Financial Targets at Assetta Cagista represent the beliefs and assumptions of the company's management, as well as information that is currently available. Future statements are not a guarantee of performance. They involve risks, uncertainties, and assumptions as they involve future events, and rely on circumstances that could or not occur. Investors should understand that general economic conditions, market conditions and operational factors can affect the future performance of the company, leading to results that differ materially from those listed in such future statements. Now I want to pass the floor to Gabrielle Helu, the investor relations director. Hi, good morning, everyone. Thank you for participating at this earnings call for the second quarter of 26. I'll be presenting the executives present today. We have Belmiro Gomes, our CEO, Rafael Sachete, Anderson Castilho, the VP of Commercial and Logistics, Sandra Vicari is our VP of People and Sustainability, Rafael Sachete is our CFO. Now I'll pass the floor to Belmiro for the beginning of our presentation. Thank you, Gabby. Good morning, everyone. Thank you for participating. Now, here we have the numbers on the first slide. Numbers in the first quarter, you still have pressured consumption. So if you had the opportunity to take a look at the numbers, but execution was very consistent in this quarter. We gained a share. We had an important expansion in our flow. We had an all-time high record. We were able to advance significantly in energy leveraging. So it's not a quarter with demand acceleration. It's about discipline, resilience, and economic evolution. So even in this economic scenario, Acai gained market share, expanded their customer flows, preserved margins, and led to a leverage market of 2.37. So that demonstrates that even with a pressured ticket, customers continue to search for SAE as a destination. And so the total base goes up 2.4 and you can see that there is a challenging environment. However, the company gains within the cash and carry market a share of 0.3%. So an important point in the quarter is that there was an increase in the customer flow. and that happens in our same store base as well as in the total base which would be the 3.4 and then you can explain that movement that we've observed which is the consumer preserving their frequency but at the same time adjusting their purchase mix and basket searching for more cheap for cheaper products right so the maintenance of the levels of debt, high interest rates. And I think everyone's been watching the Brazilian economy and I see this macroeconomic context. So this environment is not a homogeneous environment. We've already highlighted this and seen this heterogeneous movement where you have lower social classes, especially the class CDE public with more pressure. So when you look at the consumption dynamic, you can see a persistence in the trade down. We had opportunities to demonstrate in our investor days, and we had two carts at the same store, same taxes. One costed 830, which was the leading English brand, and the other cart costed 437. So you can see this ramp up of the migration of the brands at a moment of commercial pressure. And so they used the trade down And so we can see that they don't necessarily reflect the actual customer choice, right? So in order to consider this, they've been having to perform trade down decisions and preserve their volumes. And so what we can observe in the social levels that are a little lower, and so you can see this frequency that there's a ongoing flow of customers without an increase in the average ticket. So despite all of this, the efforts we've performed with balancing out the margin makes a bit of pressure in the actual number 0.4 but I have to explain because you have an effect of the tax substitution with the Aymar Giglio, Aymar Castelo Branco Helu, There's a bit more caution in the type of purchases. So the expenses have this effect of 0.20. There's a slight increase, but it's of course a lot lower than the actual increase in customer traffic. So when you see the expenses per customer served, It goes 1.6% below inflation, the actual food inflation and the general inflation, because expenses are really connected also to the amount of customer service and the customer traffic. So the net income, recurring net income, $344 million, an evolution of 94% compared to the same quarter last year from an accounting view, $537 million. The company is being very conservative and very transparent. providing this kind of disclaimer and showing the operational performance without any tax credit impacts so that the market can really keep up with the actual operational evolution of the company and then after and Sachete will cover this you have the operational cash generation reduction of the net income 1.4 billion in the last 12 months reaching the leverage level of 2.37. Cash availability is also very significant and an important point we've seen, and Rafael will explain this a bit more, which is purposely reducing the discounted receivables. Since in this leveraging process, when you consider the availability, we end up working with this level of anticipation that is greater than what we had to work with in previous quarters. Next page. With this, a bit of what I've already mentioned in the previous part, it demonstrates this effect of the tax substitution. When the product subject to this tax substitution, the net sales is the same as the gross sales, considering the tax, state taxes, and when it leaves the tax substitution, then you have, when you look at this and we normalize this effect, you have this effect of 0.26% within gross profit and Zero20 in Expenses. So when you look at the comparison of course the company of course you can see this result considering the net sales which is the standard of the market but the comparison is always taking place considering expenses upon gross sales. So when you look at this it's important to highlight the effect. The EBITDA considering higher pressure of expenses has a slight stable impact kept in the second quarter which is an EBITDA of about 5.6. So In the environment with challenging consumption, we've been trying to set up this commercial strategy that's more efficient. We have a significant contribution in the margin considering the operational efficiency and maturity of the stores, especially those that came from the extra conversion period, considering the last batch from the SA expansion and a lot of the services added on like a battery and and a slice called Cuts and Deli. But over time we can really evolve in productivity, the ways we work and pricing and that has really helped with the composition of our gross margin and maintenance of this margin has been done considering the maintenance of competitive advantage. So when you look at the customer flow or even the sales per square meter and especially when you consider the market share. Then the expenses also had a slight impact with the new avenues for growth that we're going to highlight up ahead. But it also reflects the combined scenario of the customer flow increasing and customers still keeping up the trade down. So I'm going to pass this on to Sachete as he highlights the points of the operational leverage. Okay, we can advance to the next one. Hi, good morning everyone and thank you Belmiro for your presentation. I'm going to talk about our financial results, our net income, our debt level in the company, our financial results here. We have an inverted calculation, so the lower the better. We reduced the impact of this financial expense of 25% compared to the same impact that affects our net income reaching and what were the main drivers of this improvement the financial results well first the maintenance of our EBITDA and our cash generation the company our strategy for the leveraging the lower level of debt so through this strategy the gross value drops and we also start for the first quarter after many growth We have this average rate of the cost of debt that's dropping and this dynamic should remain if there's no change in the economic policy as a supporter or benefit for our financial results to the end of the year. Then we had a positive impact with the Tax Credit Updates with the SILIC Credit Adjustments, right? And so when you look at the net income, we reached $344 million of recurring net income, 93.7% growth. And so our accounting net income is of $537 million with non-recurring effects of tax credits. The comparable base would be $244 million, supported by EBITDA and financial results for the company, which had a significant improvement. Moving on to the next slide, we're talking about this pillar that's so important, which is the company strategy, pretty leveraging, right? There's an important effort with the entire team to keep up with a high level of services, good sales, high margins, efficient management of expenses and in capital allocation and our working capital and CapEx with a focus on the leveraging of the company. So the general cash operational generation was about 3.3 billion. We had a CapEx plus the impact of the sales lease back of 600 million. with a free cash flow generation of 2.7. Then we get into the interest of the debt and dividends with 2.3 and we have a final cash generation of 1.4. Why is it not 0.4? Because we have a normalization of the receivables, An important point is within this strategy we're reducing this receivables anticipation and over a while I believe you won't have this effect anymore in the company's results and earnings because for now we have one billion already supported in this normalization. Then on the right side, you can see our financial leveraging. So our financial leverage, we have a drop of 0.8 times EBITDA, reaching 2.37. You can see it's a dropping trend and this trend is set and should remain till the end of the year. So the company is very confident that this will continue to drop over the next quarter. Now about the gross cash position, I just want to reinforce this, but of course, it's in our release. We have a cash position that's very solid, very healthy. We can move on to the next slide, please. And we close the quarter with $7 billion between cash availability and also the cards we could anticipate. This is a growth of 20.9% compared to the same period last year. And the robust cash position gives us the necessary comfort that we have two years of our debt We continue to be comfortable, but of course the company has to close to monitor this market and possibly taking on other long-term credit facilities to have safety and to really support our strategic plan of deleveraging the SA group. I'll pass the floor now to Sandra. She talks about our people and sustainability areas. Good morning, everyone. Moving on with our commitment towards sustainability, searching for ways to generate more value for the company, we continue to operate in a strategy that is structured by three pillars. Efficient Operations, Developing People in the Communities, and Ethical and Transparent Management. And in this quarter, we've advanced significantly and consistently throughout this ESG agenda. And I want to highlight that we are reusing about 47% waste Expansion of our initiatives for composting and water efficiency and also the evolution in the fourth consecutive year of the index of the ISE B3 index as one of the only retail companies in this index. So we're also strengthening a more inclusive and diverse environment. We expanded our I also want to highlight over 5% trainees. In our young trainees, right? So that was important for the recognition with the Bungee Youth Employability Award. With this, adding on to all of this work, we've also published the annual report for 2025 of the Acai Institute initiatives as a responsible for all of our social investments and that also consolidates our earnings in the first three years of work performed by this institute and also reinforcing our commitment to the development of communities where we are present. These were important advances that we've had in sustainability. And I'll pass the floor back to Belmiro so we can continue with the presentation. Thank you, Sandra. And now I think we're going to talk about our different avenues for growth. As we've seen in the numbers, the macro scenarios still pressured other companies, not just waiting. for improvements in the macro scenario so besides this in this quarter we were recognized once again as the most valuable brand in the food retail scenario and maybe we have one of the biggest assets in brazilian retail which is this growing traffic of 40 million people visiting our stores every month this comes from a relationship that is built upon trust and low prices and Our avenues for growth are all starting off with this asset, right? Our focus is to expand our presence in customer routines without losing track of our food core, which is really having low prices. It's not a switch in the model or change in the model, but an evolution of this model. So we're talking about existing customer traffic and using this, taking advantage of this for new opportunities. And so we have The possibility of adding into the customer shopping journey. We keep looking for ways to increase the share of wallet with initiatives that don't require a lot of capex investments, but that can improve also our capital allocation. And so some initiatives in each of these are different stages of evolution. We've had significant expansion in well-being, which is supplements and vitamins. This is already present in 93 of our 300 stores. We should reach this new category in 300 stores by the end of 26. We're talking about creatine, free-train, workout vitamins, We're adapting to these habit changes among our customers and our own private label. We have about 30 products we've already launched as private label products and some categories are over 10% there and the categories they're in. So this is an important lever for us. Especially if we consider margin gains for the future and also keeping up our competitive price levels and offering to consumers the opportunity to have a quality product, a well-known brand, and very relevant prices. So we have new products incorporated every week practically. In this assortment, we should have a gradual expansion to the end of the year. I believe that next year, these products will already have more significance due to the volumes SAE has in big markets here in Sao Paulo. And for digital, we've advanced with over 200% increases within the partnerships we have. We have 104 stores with the iFood operation and 16 million users from the mail that also receive these inputs through offerings of prices helping to increase our For the in and out, we bought 11,000 refrigerators and we sold all of them. This is a project that is still evolving and we want to take advantage of the customer traffic with products that have opportunity batches and customers can look at this and see the opportunities they have reinforcing This image of low prices, so we're still waiting on the approval of the bank, central bank for the second most important phase. So then the pilot project for Assaipay, which has operations in about 30% of these stores, has also evolved. 55% are new customers that have adhered to the product. And then you have the electrical fuel stations, and so most of this is in the free market we have a cost advantage it's about half of the residential fees that consumers pay so our objective is that we can provide customers with the opportunity to recharge a hybrid electric vehicle at a cheaper rate than they would pay if they were to do this at home and so we receive about 20 million vehicles monthly Coming from customers that supply or fuel up and recharge in our stores. As soon as we finish our technical studies on feasibility, as most of our stores have leftover demand, the expectation is that customers can farm purchases. And this is a project that has been advancing a lot in many countries where we've had growing electrification and also for fuel stations. We've also been assessing this possibility and the chance of maybe integrating all of this system or this ecosystem for the food, shopping, drugstores, digital and also in another routine or mission to supply these customers and the initiative maybe the most important that I want to highlight was that now we opened our first after 30 years We launched our first drugstore within the store environment, the store-in-store, and we were really quick with this project. It was the first sector, and we launched four months after the approval of the new law. Up until then, the food sector could not have a drugstore inside the store. It would have to be in the gallery. If someone asked me what changes, I'd say, well, in the gallery, after the customer's already performed a purchase, it's really difficult. for them to get into a drugstore and shop for drugs with products already in this part. So the first unit was launched in the iconic Ariguera store where they opened the first extra hypermarket. It's an extremely well-located store with over 180,000 people visiting. Almost 200,000. And it's completely integrated. And so we already have two units under operation. And by the end of 2026, we should have these units. And in this period, we were expecting that 250 units potentially would be the potential for the mid to long term. So we already have a store, we already pay for electricity, AC, safety, and all of this. The capex for the implementation should be below 400,000 riyals. And so we should have a total investment in these 250 of about 100 million riyals with a sales potential that's very relevant. And so this drugstore has a full assortment, which includes prescription drugs, GLP-1s, controlled drugs, vitamins and supplements. And this is all going to be integrated, right? When we opened this first unit, it was not only the first drugstore, but also the first online operation where the delivery is done by us. Within Acai Pharma, customers can also buy through the app and they'll receive the drugs at their house. And so what we've seen in the first days of our operation is that the numbers are above what we expected. You can see that for customers to be able Anyway, since they have to come and shop, the possibility for them to be able to buy the drugs is also an important step. The team really helped us with this and I think more than just talking about this deployment or more than just us telling you how it was, I would really like to say that we actually have a little video that was made. Not by us, but it does demonstrate how this was implemented and the customer. Today at the capital, we have the first drug store inside a supermarket ever since March, this type of retail establishment. So the translation is on the subtitles in the video. Thank you. Now after this video, I think we can get into the Q&A session. Now we're going to begin our Q&A session. I would like to remind you that if you have a question, you must select the Q&A icon at the bottom part of your screen. Write your name and company and the language so you can enter the queue as you're announced. May request to open up your mic will appear on the screen. Soon after, you must select your mic, open your mic to submit your questions. We'd ask you to please send all of your questions at once. We'll start off with our first question from Daniella Iger at XP. Daniella, you may proceed. Good morning, Belmiro, Gabi, Sachete, and everyone. Thanks for taking my question. I have two. The first one is about the perspective forward. It's evident that we're in a very challenging moment for consumption in the market and you guys anticipated this and have many different initiatives to handle this. But when you look at the core business, when it comes to food, you have supplements that you guys are working on, private label, but how do you guys see the evolution and the mix of categories as well as the trade down you guys mentioned? As well as prices, considering the food inflation dynamic and this product mix. So if you guys could help us. But of course, you guys have a lot more details and information, right? We would like to know what you guys see as trends in this. And then the second one is if possible, if you guys could share a little bit of what you guys consider as economics for the assay pharma stores. So when it comes to uplifting the sales, contribution margins, Aymar Giglio, So thank you, Danny. This is the consumer consumption environment. We see the numbers continue to be pressured. It's really connected to low income. When we look at this, we see the cash and carry channel as a whole. And the channel that's most impacted is what we've seen is lower income. As I was already having this in previous quarters, when we look at the inflation, we see what's the actual index, which is the movement of this fixed basket. But in Brazil, we have a bigger variability. When you look at the trade down of brands, that's really unique, right? Here it's a ramp up, right? So you have such a big amount of brands that allows customers to perform these adjustments, right? So we see an increase of customer flows. in our same store base and total base. But when you look at the trade down, it's still about 3% approximately or 2%. So customers haven't been following the inflation, right? So that's what is not, that's not what's coming out from the customer's pocket, right? So while you have this high, That level, most of the income committed to the payment of interest is kind of what happens in our results. And we don't see consumers have space for this. So what you've mentioned is we have these different initiatives and we're not just waiting for the macro environment to get better, but some initiatives that were mentioned in 10, for example, with the private label, it should help a lot because as consumers also migrate, they can choose our product and the brand that's going to give us a higher margin. But at this moment, we see consumers that are really pressured. So where have we most felt this? Well, low-income consumers, not high-income. When we look at the research from Nielsen for modern retail, we see that impacting companies that service high-income. And we see the impact is almost zero. When you look at Class C D&E, then you have a more relevant impact. And we feel this directly in this customer that buys with us, but also with the customers that supply their homes with us right and the impact as I mentioned the beginning is and what we should see from now on is well July we've already closed of course we've we already had positive same-store sales 0.50 without any calendar effects so that demonstrates that we should have a continuity scenario in the same store kind of We've been adjusting by one point up or down, but that's what we've been working on. However, in this scenario of consumption pressure, it should remain for a while. So that's why the company's really been betting on new growth possibilities. And that represents about 5%. And so any new initiatives are like a new kid that's growing, right? And so especially we expect higher revenue than Rafaama. With the 40 million customers, we have an average of 200,000 people going through the stores. So we wanted to bring this because our feeling is that it captures exactly what the customer's sentiment is, right? They have to come and shop, they have to come and supply themselves. So if they can solve this in a single journey, We can also interconnect both of these to generate cash back and successively, right? So what are the main points we have as positive and negative? Well, that's operational expenses that are there. So in the same way as the CAPEX is way below what we would need for street drugstore, when you look at operational expenses, you can kind of perform a similar calculation, right? So you have the cost of personnel, electric car, rent, Most of the SIA stores have available space to be able to add a drugstore without having to implement any major revolutions in the assortment. So within this movement, we've also been having an ongoing revision of the amount of products we've been working on in some categories. So it's really been possible to accommodate The Farm Operation Without Any Major Impacts. So the capex or drugstore is like one third of what than what we would invest in battery or Deli, etc. So our view is that we have to really work on the legal changes because we have an investment of about 100 million with the sales potential of a store. It's like one and a half store revenue. But of course, we don't want to break down our expectation of revenue per store. We're still in an embryonic study or phase of this project, but we see this as a huge potential. Thank you. Excellent, Belmiro. Thank you, Denny. Now, our next question is from Jerome Suarez at City. Jerome, please, you may proceed. Hi, guys. Good morning. The first question here is the cashback. Could you tell us a little bit about the strategy? Certainly, because one of the questions we get when we compare with our history and the drugstores and the galleries I think here the biggest evolution is that you have mutual interests, right? And both of them working well on this cashback can be crucial to help really lock in the volumes, right? Cash to carry through the drugstores and everything. I wanted to hear about the initiatives you have been considering and how you're looking at this buy-wheel of the drugstores and cash carriers. And then the second point is when you look at the sector data and you break down the same-store sales in the same quarter of next year, we can see that volumes dropped significantly in August and September. So it seems like there's a more favorable base, especially for volumes in the sector. When it comes to the third quarter and I wanted to hear about this and if it makes sense, etc. Thank you. Well, as you mentioned, If you were to consider the projects that were made now, and I want to invite you guys to go and visit the Anhueta store and see with your own eyes how the drugstore was implemented. It's very different than the products that we had before, like drugstores in the galleries or outside of the store. We could have done this before, of course, but we're never interested in this, right? Because we think it needs to be really integrated with the customers when they're inside the store. They can leave their cart there and go by, give them their list of drugs that they need and that can be separate already for them when they come out to check out. After they get their perishable goods, if they waited in the checkout, they don't want to stop anywhere. They want to go straight home, right? So their relationship with the cart is very different before and after paying, right? For their shopping. So anyways, in a store with about 200,000 customers going by, if I generate cash back of about five reais to spend at the drugstore, they're probably going to do so. So they're probably going to visit our store, right? So in our view, we're going to be providing an actual service to our customers, just as you saw in the news article made by Global. Most of the customers and people that visit food facilities, et cetera, are the people that also need ongoing drugs for chronic conditions. So we're going to have operational costs that can be passed along to the customer partially. In our view, it's We were able to open up the first one four months after the change. That means the customers really focused on this initiative and we believe it should add a lot of value to a lot of sales, a lot of margin and no additional extra costs. I show you the CapEx numbers. You can compare that what you see as CapEx. Maybe you can even bring in part of what this would be. Same stores for August, September last year, there's a drop in volumes. It was a period where we really felt a setback in commodity consumption. So especially that drop last year with rice, beans, and some carbs and this consumption has still remained at low levels. And that's why I've been very careful to estimate and a lot of the adjustments in layout and assortment was ready to prepare for this movement, which is something we've already seen. So when you see the food service customers, as well as 16 million customers in our app, we can see the recurrence in volume. And so this guy from food service, the guys from pizza stands, restaurants, snack shops, et cetera, they've been keeping this frequency, but they do see a drop in volume. I hope to have answered. Yes, thank you so much. Our next question comes from Vinicius Estrano at UBS. Vinicius, you may proceed. Good morning, Gabi, Belmiro, Sachete. I wanted to explore a little bit about what you guys see as a customer sensitivity to price movements today, right? And also getting a better reading on your view in regards to the competitive scenario, right? There was a shift in The management from your main competitor. I want to know if you guys have noticed any differences on pricing and commercial practices. If you guys could talk about the market share per region and also the performance per region between SA and the market. Okay, Vinice, thank you. In every region in Brazil, I think the movement of the regions is a lot more related to the income classes and the region itself, right? So if you look at the Northeast in Brazil and the North of Brazil, there's low performance because it concentrates most of the population of low income. That's going to be very visible, right? And also within each of the regions. And so you can see that in the Southeast a lot more resilient. But when you look at this within Southeast, you'll see stories like Congonia's with a high income population have no impact. So when you look at the other part where you have a population that's a little more pressured and then that's connected to the debt up of the families, right? So 82, we reached a new all time high level of commitment, compromising the income, right? So that's not standard. And what we've seen in a real tough way is Aymar Giglio, Aymar Castelo Branco Helu, Aymar Giglio, Aymar Giglio A company our size, a brand as strong as ours because customers are willing to search for quality but they have a price limit then private level can be something that's very relevant so we have very positive expectations right and you can notice that from the customers they're really willing to perform brand trade downs and cleaning products especially and so they've at the limit they're at the limit of what they can actually spend Then you asked something else about management. Yeah, it was, thanks for the answer, Belmiro, and it was about the competitive scenario overall and also specifically about the competitor. Okay, well, obviously, as each company has changes, but as you can see, it's the consumer environment, right? So consumers are Paying high interest rates and as you can see the bets and initiatives you've had are really based on keeping customers in-house, gaining new customers and increasing the share of wallets so we don't see like market elasticity that can allow for major movements, right? And so we've seen certain changes in the commercial policy but at this moment what pressures us the most is the macro scenario So our next question comes from Irma Garz at Goldman Sachs. Irma, please, you may proceed. Hey there, good morning. I wanted to take advantage of the last point. It's a great moment for private labels and could you talk about the lessons learned so far? I think it's a real significant moment since in the past you guys I always had a bit more resistance considering the size of the operation in the southeast and now as you guys launch a private label as well but I wanted to hear how you guys consider additional categories and products and the challenges that you guys maybe found over time and maybe a bit of how you guys consider the brand strategy as well right you have the chef brand of course for one part of this private label segment but you guys also consider segmenting private labels and with this would you guys believe that the best path is to separate privately from the side brand with like a commercial name or or having some kind of umbrella brand. Well, at the moment you have a consumer that's really willing to have a brand trade down. The SAE brand is the most valuable and the most well-known. Any research can show you this. Of course, there is a risk when you associate all of the products. So we brought a very skillful team with a lot of knowledge and very experienced from a quality perspective. and Loriani under Sergio as well. And so the R&Ms we've included so far and maybe the project could even advance quicker if we weren't looking at this. We have a test labs and a series of initiatives to ensure that what we're gonna deliver to customers is really valid, right? So we have like the assay signature and then you have The name Blue as well. So there are some processes we're still adjusting and getting lessons learned, but some of the biggest challenges so far, even because of the volumes, because Brazil doesn't have that many suppliers of private labels, right? And so our volume within the state of Sao Paulo with 120 stores under activity is really So we're probably going to do this even with some suppliers that are already suppliers of natural brands and that should also maybe lead to a reduction in these investments. But we see this was a major potential, right? So now as we've seen, we have this scenario where we can have this private label scenario that's very relevant. So the objective is not to have an increase in sales, but improving the margins and use this as pressure with our existing suppliers. So when we see customers really adhering to buying a private label, it could be that after we'll also have Econoball and Chef. But at this moment, as we have the need for speed, we'll have a lot of products and they're going to continue with the SA brand. Sajit, do you want to add on to this in any way? No, Belmiro, I think that was great. And I just want to say every week we're launching new products and I want to highlight our concern with the quality. It's not a first price product, but it's a product with a quality that's very similar to leading brands. This strategy has been growing a lot. The number of items in the store with greater presence and customers a basket and we'll be able to add a lot more strength to the private label. Great, thank you. That's very clear. Our next question comes from Lucas Estebis at Santander. Lucas, please, you may proceed. Hey, good morning, Belmiro, Sachete, Gabby, and everyone. Thanks for this opportunity. We have two points we want to discuss. First, the gross margin continues to demonstrate consistent evolution. And I wanted to know from your view how much of this comes from the maturity of the stores that are open in the last few years and how much comes from other structural initiatives like the Butchery Deli, Bakery and I know there's also a tax effect but I would like to know about the operation and if there's still space for expansion from now on right so another topic uh that you guys also mentioned is the assay services over 40 million customers per month and that's still impacting and the SIP pilot project demonstrates that over half of the customers are new. So how far do you consider this financial vertical as a monetization potential or opportunity and is it more of a relationship tool to increase conversion, et cetera? Well, financial vertical, yeah, we're very anxious to get the release for this, right? For the financial services. The Passai product is good but it's really restricted to only a few of our customers so maybe one of the biggest value levers we have is really the financial aspect and that this could really help our sales as you grant credit through a private label and then at the same time you can also have new revenue and we see this as a great potential so when you look at the installed Aymar Giglio, We didn't expect that this could take so long, but it is a product with high potential and so we have been working on this project since we have a clear idea of the potential and market and What's the level of penetration that it could provide? And as it's more of an internal product, you'll have moments where you're going to be leveraging sales and there's going to be moments where you're going to use this product also to extract even more value from this vertical, right? So these are kind of, just as I showed you about the pharma, What we're considering is to create this ecosystem that is richer, right, up ahead. So when you talk about the electrical charging station and all of this within this relationship that SAE has at this customer base. So gross margin, we have part of this. And so when you look at the increase in margins, We would see some sections like Deli and Slice Cold Cuts were very polemic, but now they add a lot of margin to the business. So we're always very cautious about this. And in our products we've been working on, But especially with the private label issue, it should add a lot of value to the brand. So the company is working to have a growing margin, even in a consumer environment that we already considered isn't really an environment that's very challenging, right? So thank you. But we do have a great Friday. And so, yeah, please may proceed. Thank you, Sachete and other directors on our side. We have three questions. I think the first one, and these three are follow-ups of topics we had already approached. The first one is about the dynamic for demand. How much space do you guys imagine there is for trade down and how do you imagine the continuity of these more challenging trends we have in the market? I think that's the first question. The second one is within these new initiatives, You explained that there's already about 30 new SKUs and what do you expect to reach? When you think about 2026, 2027, what's the ambition? And maybe one last topic is the subvention topic, right? So we still have about 900 million left as tax credits. with Peaceful Fiends and I would like to understand this better so we can project this line and understand how much you expect to capture throughout the next quarter right if it's going to be linear um this is we had seen this in the first and second quarters of 2026 so those are my three questions on my side thanks guys thank you and um I'm gonna leave the last one here to Sachete so you can talk about subvention and the tax credits um on demand and trade down we've seen You can see this correlation with the debt level among families. Since it's at 82% and we can't reach 120% of the families, we'd expect that as you have a drop in the interest rates at this movement, with the trade down, we'll probably set back. but of course we also had this expectation for 26 that did not become concrete as debt levels among families became really high and numbers talk about 26 percent or so the income and that ends up pressuring things a bit so that's why we have to be careful and a lot of the new initiatives the company has been trying to adjust quickly in this scenario and as the macro environment gets better I believe customers also want to recover we already had years that were pretty good and a lot of the stores came from trade up right so in Brazil maybe this is easier than in other countries right so it's not a It's a ramp, right? And then you can see how much is possible upwards or downwards. So what we believe is that in this trade down, we should still keep in the third quarter, but then as the debt levels drop and you have this adjustment in expectation for interest rate drops, that families would be able to stop the trade down. That's something that's really gonna depend on the macro scenario, right? And here we're a lot more connected to the macro scenario. That's what we've seen on some failures in our numbers. I'm really reflecting this macroeconomic scenario that can service this within the Brazilian population. The new initiatives, do you want to talk about this? The new brands and expectations we have? And then we can pass this on to Sachete. Yeah, so this year in 2026, we'll have about 250 SKUs. We've been evolving and we already have a lot more than this in the stores. And we believe that for the scenario in 27, we'll have double the amount of this number in SKUs that already launched and we continue to launch in the next few years. Especially in categories where you have more relevance and you can have more penetration or profitability way above in the category. All right, so on our contingent assets that you are considering for the growth of taxes, the company has a series of taxes that are connected to products And we're also considering the per phase regime as well. And we have the monthly use and we're going to consume this credit monthly as well. But I want to remind you that this credit is considering quick usage as we consume this and consider all of the per phase regime that will happen until the end of the year. Then we can send this credit out very quickly as a fiscal phase in CVS. When we consider the migration proposed by the government for the different tax models, then we're going to have a automatic migration, which becomes a recoverable credit. And Considering our revenue levels and margins, we are very confident that we'll have a cycle of less than 18 months to consume this credit as a whole. The next question comes from Rodrigo Garcin. and so just I wanted to ask you to explain you talked about a same store without a calendar effect I wanted to confirm this point and within this trend if you could break this down I think you talked about the trade down a lot but the composition still between price and volume that would be great get a bit of this perception about July and in greater depth and then the second question Sachete is on the topic of the ST credits because Part of this has already been paid and you consider that when a tax is recoverable. But when do you think you'll be able to recover this, right? Throughout the next quarters so that we can already Include this as a composition for this cash generation as well. So these are the two points. Thank you for that. Yeah, we did talk about July. The numbers are correct. I mentioned that we have positive same store, 0.50. And for volume, it's pretty much stable. You have a slight increase, especially when you look at customers coming from food service. So July demonstrates this continuity of the second quarter. So you can notice stability in the average ticket. Of course, we're still in the first month of the quarter. It's a holiday month, right? So it's kind of different. It may not be a good sign of the full quarter, but we do notice that in this scenario with debt, there's major concentration of purchases in the beginning of the month when you have the credit card turnover, right? So customers are pressured and then even The reality between days has been a little different than what we had observed in different years, prior years, but July has this stability in the same store that's positive. Great, so I'm going to get this point on tax now and gushing. We have two credits that increase our level of the balance. First one comes from fiscal fees and spur phase regime. And in regards to ICMS credits, for ST São Paulo, just a broader explanation so everyone can have the same basis of understanding. We have a relevant part of our business in the city of São Paulo. There was a tax regime of ST for a very big group of items. And in this model, the products are taxed from their at origin, right? And from the credit of ICMS to be generated, we were already considering this as costing when the products came in. then the state's changing this and up until October there's like this curve every month for having A ramp up of products and that start moving into the normal tax regime. So when products come in, the invoice come in, you have an increase in balance and ICMS recoverable. And since this number did not exist before, it generates some impacts in our quarter. But when you look at the recurrence, this number tends to head to practically monthly consumption or stock turnovers really quick. This is done in about 35, 33 days. Our next question comes from Wellington Santana at Bank of America. Wellington, please, you may proceed. Well, guys, good morning, Belmiro, Gabi, Rafael. Thanks for taking your questions. We have two here on our side. I want to understand, because I think there's this point with weaker consumption. consumers being a little more cautious about this and trade down and how can we consider also the owning phenomenon and acceleration of prices, inflation, food inflation and how do you also look at this from a B2B perspective and In-N-Out Strategies, and if you could also update us on the partnership you guys have with the MercadoLibre company and how that's moving and how you're considering this integration, just so we could get an update on this point, that would be really good. Thank you so much. Thank you, Wellington. And Onio Effects, well, we've been, of course, looking at this and it should be confirmed, but what we've seen is and we can imagine the capacity to transfer prices that will happen and so in this scenario actually O'Neill could influence commodities that sometimes already have a bit of depreciation right so we could have a positive effect in regards to this of course we have to be careful and then consumers have to continue to buy this kind of product right but there could be a slightly positive effect right so the capacity to transfer and pass along prices is something that we've been able to keep with the level of price pass-alongs. But what we can't, what we haven't been able to do is to have customers buy more volumes. So that's related to, of course, the macroeconomic conditions, right? So 35 items at the moment. We have purchases from customers in over 1,600 different cities. There's an integration issue when it comes to the tax platform that's taking a little more time and it should advance now. To have numbers, we knew the integration would be a little more complex. These are two big companies integrating in a whole variety of items that are quite heavy in Brazil. So we should have bigger numbers in the third or fourth quarter. Perfect, thank you so much. Our next question is from Nicholas Lahine at JPMorgan. Nicholas, please, you may proceed. Hi guys, good afternoon and thanks Belmiro, thanks everyone for the call and for taking your questions. I wanted to talk about working capital, Belmiro, do you guys see Aymar Giglio, Aymar Giglio, Aymar Giglio, I think here the word is stability we could have some one-off effects like the anniversary campaign that's going to take place now in the second semester but nothing very relevant right so changes in financial lines as Sachete mentioned is just the discounts on receivables that the companies were going to eliminate any levels of this as soon as possible right okay that's very clear thank you Well, our next question comes from Guilherme Dominguez at HSBC. Guilherme, please, you may proceed. Hi, guys. Thanks for this. I have a question on self-checkout that grew over 40% year-over-year. Could you guys quantify the productivity gains with this initiative and where you are planning to reach in the next years? And then also comparing with the mature markets when we look at players like Walmart, Target, Dollar General, they all invested in this initiative throughout the years and then recently they reduced this. They started to reduce self-checkouts due to their experiences with customers and concerns with shrinkage. Could you mention how the company assesses trade-off between productivity and controlled losses? Well, yeah, we saw these initiatives. We've been monitoring this breakage. And however, in this scarcity, where you have a lot of big volumes in the beginning of the month, cash carry and retail, when you have this service, sometimes you have customers that normally just consider like a replenishment purchase, right? So at the end, self-checkout is what allows for this when you look at Aymar Giglio, Aymar Giglio We've already had a lot of customers when it comes to packaging and so we have other initiatives for productivity but I think the self-checkout is already a level of maturity and that helped the expenses for customers service really increase below inflation. Okay, thank you, Belmiro. Great. So now we're going to head to our last question for today. It's a question in English from Andrew Rubin at Morgan Stanley. Andrew.

Thanks very much for the question. Most have already been answered, but maybe just one on new stores. I know it can take maybe a couple of years to plan the new store pipeline. So how are you thinking about the right pace of growth over the next few years? Again, I know you have the capital allocation priorities, but curious your outlook for what the market can bear in terms of new size stores. Thank you.

Thank you so much, Andrew, for the question. Obviously, the company is really focused on deleveraging and we really reduced levels of investments. We had to hold on to a lot of these projects, some of them in the land bank we're already performing. But of course, the focus of leverage as the interest rates were not close to the levels we expected. A few years ago, we had to perform a reduction that was significant. When we look at this after, of course, the company, it's just a matter of time, right, until you can do leverage. But of course, from the model that's going to be expanded, it's going to be already a different model, right, with the drugstore, the electrical charging station. We're going to have a more complete model with the amount of stores that can be expanded in the future. But at this moment, I think it's difficult to have any kind of precise assessment. It's going to depend on the leveraging curve, the assertiveness of the new models and the operation of this structure and capital structure also in this moment to the company.

That's all very clear. Thank you.

With this, we've ended our Q&A session. And we would like to pass the floor to Belmiro for his final remarks. Thank you, Rodrigo. And I think at the end, it's this initiative we brought our end beginning. We have a challenging consumer environment. There's a macroeconomic issue that, of course, is not under our control entirely. But the company is really focused with different initiatives to improve our core and working Our biggest facet is the customer flow monthly. You can see all of our initiatives start off with this. This is not an adaptation because we have a more challenging scenario. A lot of these new initiatives were already expected as we perform the extra acquisition and they really place the cash and carry stores among higher income customer base. And so this evolution in the model should continue. Of course, we're very convicted that 40 million monthly customers and a growing pace and our brand strength is going to be an important platform for all of the new initiatives to really generate the necessary results up ahead. So thank you so much everyone for your efforts this second quarter. I want to thank all of our team and I want to thank everyone for participating in this earnings call. Thank you so much. Earnings call for the second quarter of 2026 of SAI Takejista is officially ended. The Investor Relations Department is available to answer any of your other questions. Thank you so much for participating and have an excellent day.