Genomma Lab Intl Sab Ord

Greetings, ladies and gentlemen. Thank you for joining Genoma Lab's third quarter 2022 earnings conference call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. As a reminder, this conference call is being recorded and will be available for replay from the investor relations sections of Genoma's website following this call. I'll now turn the call over to Barbara Arcano of the Inspire Group. Please, go ahead.

Good morning, everyone, and thank you for joining today's call. With me today are Jorge Bray, Chief Executive Officer, and Antonio Zamora, Chief Financial Officer. Before we get started, I'd like to remind you that our remarks today will include forward-looking statements, such as our financial guidance and expectations, including our long-term objectives and forecasts, as well as our expectations regarding our business, assets, products, strategies, demand, and markets. These statements are subject to risks and uncertainties that could cause actual results to differ materially. They're also based on assumptions as of today's date, and we undertake no obligation to update them as a result of new information or future events. Let me now turn the call over to Mr. Jorge Briggs.

Thank you, Barbara, and to everyone joining this morning's call. Let me start by summarizing today's key messages. While the global operating environment remains volatile, our teams continue to execute with agility to advance the pillars of our growth strategy. Genomas balanced portfolio and operations and diversified risk profile again enabled us to deliver both sequential and year-on-year top-line growth and margin expansion on a consolidated basis. We achieved a more than 9% year-on-year net sales increase and a more than 11% increase for the quarter closing in September. which represents Genoma's 16th consecutive quarter of top line growth. We also reached a 21% EBITDA margin, and we see quickly approach our stated 24 to 25% EBITDA margin targeted for 2024. We're excited to share the news that Genoma's body and facial cream manufacturing lines began operations in September. This is, therefore, the first quarter with all five production lines fully operational at our personal care manufacturing plant. It is an important milestone and critical inflection point of our vision and strategy, which will trigger an additional margin improvement we expect to achieve as part of our targets. It is also relevant to note that the strong third quarter results we are reporting is without the full benefits we expect from genomic manufacturing, particularly on cost of goods sold, which will drive improved profitability in the short and the mid-term. More efficient working capital dynamics and potential market share gains from more competitive pricing and better service. Genoma's remaining industrial cluster manufacturing lines are also ramping up with more than 8 million square of bottles produced during the month of September alone. And continue ramp up of our shampoo and pomade lines producing more than two and a half million bottles of shampoo and one million bottles of pomade during the third quarter. On the pharma plant side, production levels further increased during the third quarter to reach 35 million solid tablets and half a million semi-solid units. Finally, during the quarter, our Suerox isotonic beverage manufacturing line received good manufacturing practices certification by the Mexican Health Agency, COFEPRIS, in the third quarter of 2022. GMP certification enables now Genoma to export isotonic beverages to markets that do require those certifications. We maintain our focus on high growth categories during the quarter with low risk production innovation, product innovation, and new product launches. Additionally, our strong brands enable us to increase our presence within new channels and points of sale to deepen and expand our reach during Q3. We also increased our digital and omnichannel engagement with our customers, creating a more personalized customer experience and exceeded our expectations for the quarter with respect to overall digital customer engagement. This increased engagement drove a 50% year-over-year increased percent in digitally driven accumulated revenues in the U.S., which is in line with our target to reach our goal of 10% of our net sales from the e-commerce channel in the region. Turning to our markets, Mexico year-on-year net sales grew 9%, to reach close to 2 billion pesos for the first time in its history for the third quarter of 2022, reflecting a strong rebound in category performance for this market, where we again added new points of sale during the quarter. We maintained top-line growth at our U.S. operations with a net sales increase of just under 26% year-on-year to reach 420 million pesos for the third quarter of 2022. Importantly, this, once again, growth was widespread in all our priority brands, all trade channels, and all key customers. We deepened our retail presence, notably within Walgreens, CVS, and Walmart, and saw particularly strong sales from the new Tio Nacho product, Cicatricure, Tocol, Tuerox, and other SKUs, and robust e-commerce sales, particularly on Amazon. Third quarter Latin American sales grew just under 7% led by strong sales in Colombia, Brazil, and Peru. As can be expected, Argentina's sales were dampened by inflation and devaluation in this country. However, our Argentina team is maintaining its focus on the factors we can control with improved supply chain performance and effective revenue management to counter Argentina's inflation. We are also delivering strong innovation with a focus on highlighting our relevant, differentiated, and value-driven products and brands relative to our premium product competitors within the market. With inflation at four-decade highs, consumers everywhere are expressing uncertainty about the future and seeking value. At the same time, we know that health and wellness will always be a priority, and increasingly so after COVID-19. We're leveraging our expanding portfolio, footprint, our digital capabilities, our hallmark brands, and deep consumer insights to continue driving growth. We're pleased to have delivered a strong third quarter and fiscal year to date, which we believe is not resonating in the price of GenomaShares given the overhang of today's global macroeconomic headwinds and inflationary environment. Genoma was also recently removed from the S&P BNP IPC index in Mexico with a related loss of our prior index fund shareholders. We believe Genoma's shares, therefore, represent a strong investment opportunity at today's levels and considering the opportunity we see ahead. In closing, we are truly grateful for our team's continued dedication and commitment and are confident that successful execution of Genoma Growth Strategy pillars will continue to further resonate on Genoma's future results. With that, let me turn our call over to Antonio for commentary on our third quarter results, and we'll be back for Q&A after that. Antonio?