Genomma Lab Intl Sab Ord

Greetings, ladies and gentlemen. Thank you for joining Genoma Lab's fourth quarter and full year 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 section of Genoma's website following this call. I'll now turn the call over to Barbara Cano of the INSPIRE Group. Please go ahead.

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

Thank you, Barbara. Good morning, everyone, and thanks for joining us today. 2022 concluded a challenging and volatile year for retailers and manufacturers throughout the world, with ongoing impacts from more than two years of COVID-19 shutdowns, political turmoil, and supply headwinds. Genoma has been successful throughout this period. In the last years, the Genoma's team has done a terrific job of managing that which we can control. Specifically, in 2022, our sales reflect success in ensuring our value proposition are right for today's consumer in a uniquely difficult environment. The challenging environment coupled with continued forex and inflationary issues adversely impacted Genoma's results in the fourth quarter of the year. However, we ended 2022 setting all-time sales and EBITDA records for our company and delivered our fourth consecutive year of solid growth driven by the strategy we launched at the beginning of 2019. We have achieved more than 4 million 4,000 million pesos in net sales and exceeded 800 million pesos in EBITDA consistently in recent quarters by successfully advancing the pillars of our growth strategy. Let me share some related highlights for the year. In 2022, we made significant progress related to new product innovation, which continues to be an important competitive advantage for Genoma as we further differentiate and diversify our brands and stressing our relevance with consumers. 2022 saw a strong implementation of innovation initiatives, particularly line extensions throughout the markets where we operate and with new category performance supported by aggressive external media campaigns and in-store marketing. Throughout 2022, we increased our digital and omnichannel engagement with our customers, creating a more personalized customer experience and deepening overall digital customer connections. Importantly, another related milestone is our success in establishing and building our e-commerce sales presence through important online retailers, including Amazon. which today, for example, represents more than 10% of our business in the US. Throughout the year, we replicated our strategy of expanding Genoma's strongest go-to brands and products, what we call our proven innovation, and deepened our presence within countries and markets. We continue focusing the business on the OTC categories while increasing genomics presence within convenience stores as well as national, regional, and independent pharmacies. Some noteworthy examples are Suerox, outstanding reception in the U.S., and more recently in Chile, the third country to which the brand has expanded. We simultaneously launched new environmentally sustainable packaging for Tio Nacho shampoo in Mexico, Chile, and Costa Rica. Tio Nacho sales in Mexico ended 2022 with a substantial plus 21% year-on-year increase. Importantly, these examples of low risk innovation showed a favorable risk relative to return complementing higher risk new product launches. A final related note on our 2022 go-to-market strategy success is our progress in strengthening Genoma's brand presence within the traditional channel in all countries where we are present. In Mexico, we ended the year having closed aggressively exclusivity agreements on thousands of stores. Turning to our focus on Genoma's world-class supply chain, I am very pleased to share that Genoma's five personal care manufacturing facility lines are now fully operational. The facility's shampoo manufacturing line produced more than 3 million bottles of Theonatron van Aert and achieved a 93% of efficiency rate in the pomade line. Our Zoetrox manufacturing line continues delivering production levels that exceed our initial expectations. producing more than 76 million bottles during 2022. Genoma's pharmaceutical manufacturing plant production levels also increased during the fourth quarter of 2022, with 27 million next tablets and more than 1 million semi-solid units produced for the Mexican market. including the successful completion of the production transfer process for Unesia, X-Ray, Doll, Silca Medic, and UltraBengue, brands to Genoma's own manufacturing lines. With this, we have achieved another important milestone for our company evolving our manufacturing to our internal facilities. Once fully completed, an expected favorable benefit to our overall co-ops will drive improved profitability, more efficient working capital dynamics, and potential market share gains from more competitive pricing and innovation. Concurrently, we are advancing on obtaining COFEPRIS approval and resulting operating license for genomics or liquid, topical liquid, and coating manufacturing lines. This will be followed by the process of obtaining the Good Manufacturing Practices Certificate for Mexico and to then pursue GMP certification for Genoma's export markets. Finally, turning to our remaining strategic pillar, I'm pleased to share that Genoma was included within the 2023 S&P Global Sustainability Yearbook for the second consecutive year. as one of the 14 Mexican companies recognized for environmental, social, and corporate governance practices. The yearbook showcases the best performing companies among industry peers globally and in terms of financially material ESG metrics. Genomic sustainability performance was ranked within the top 15% of the industry category with an S&P Global ESG score within 30% of the industry top performing company, which was a key component to my vision and related to strategic pillar for Genoma. I'm particularly gratified by our success in this regard. With that, let me now introduce you to Marcos Parvieri, who is taking the post as Genoma's new CEO, as it was announced last year. Marco joined Genoma in 2014 and has held the role of Global COO in the last four years. Prior to Genoma, Marco also had a successful 20-year career with Procter & Gamble, working in several geographies and roles. Marco and I have been and will continue collaborating very closely in the future. I'm very pleased to have him join us today. Marco?