Grupo Traxión, S.A.B. de C.V.

Good morning, ladies and gentlemen, and welcome to the Traxion Third Quarter 2022 Earnings Call. At this time, all participants have been placed on a listen-only mode, and we will open the floor for your questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Abhi Lischting, Executive President and Co-Founder of Traxion. Sir, the floor is yours.

Thank you. Good morning. Welcome again. Adios, sir. Tracción continues delivering good news despite adverse global macroeconomic conditions. Today, I want to briefly discuss three matters, nearshoring, revenues, and margins. Nearshoring is a reality and will continue to penetrate in the next few years. Tracción is directly related to such trend, as around 50% of revenues come from it. Half is from final goods exported to the States, and the other half is from warehouse management, personal mobility, and raw material transportation. Thus, we expect a consistent and progressive increase of demand from such expansion. Our commercial force is in the frontline capturing the most profitable opportunities. In order to properly benefit from nearshoring, Traccion has several attributes. A strong 4PL logistic platform, a comprehensive footprint in cross-border operations, specialized and efficient cargo solutions, and the leading position in personal mobility within industrial parks. Moving on, Tracción had a very good quarter in terms of revenue. They came ahead of our expectations. It was the first quarter which we broke the $5 billion mark in revenue and represents the highest quarterly figure of our history. Most relevant is that growth came high in the three divisions, with logistics and technology posting the highest. It was a 29% increase, but even more important, with virtually no capex. This is precisely how we want to continue to develop this division. Our traditional business segment also posted impressive growth rates with 27% and 18.5% in mobility of cargo and personnel respectively. We continue to see a temporary impact in fuel, our most significant operating cost, which has increased more than 50%. However, the impact in margin has been just approximately 150 basis points and level at around 17.5%, which we think is very healthy given the circumstances. We will recover such compression in the short term since we believe that the fuel cost pass-through will be fully implemented by year-end. For 2022, we expect our full year revenue to grow higher than we expected. However, the impact in fuel cost is going to compress our year-end margins. In consequence, we expect to reach a very similar EBITDA figure to what we released in our guidance in February. We are convinced that we have managed this situation very well. Once again, the resiliency of our business model has proven effectively. We're excited with the growth brought by nearshoring and feel sure that the company will capitalize on common opportunities as it has always done, efficiently and profitably. To this, I end my remarks. Please, Rodolfo, go ahead.

Thank you, Avi. And thanks, everyone, for joining us today. Our commercial strategy continues to bear fruit, and there is a sizable level of demand of our three segments. That has resulted in a healthy double-digit growth at the top line. Right now, the most interesting growth opportunities we observe for the short and midterms come from the nearshoring trend, which has already driven a portion of our revenues. We have been started in several new operations with clients, mainly in the northern region of the country, whose business is directly related to such nearshoring. The logistics and technology segment continues to post the greatest growth, which is mainly driven by the commercial success of Traxporta, increased operation efficiencies in the 3PO logistics, and the launch of our pharma vertical. In terms of mobility of cargo, revenue growth has been driven by an increase in special cargo services such as refrigerated, in which Tracción continues to build a very respectable reputation, especially from the Bajío region to the border, and by increases in the price due to the growth in fuel cost pass-through. Both things have pushed revenue per kilometer almost 18%. Moving on to mobility of people, this quarter traction started operations with new clients, totally more than 400 buses. We also began artificial intelligence trials to seek improved operating efficiencies and increase our value added services to both clients and users. Finally, I would like to talk about the field pass through. As you know, we are in close contact with our clients. And we have achieved an important advance of pass-through in our contracts, which we expect to start kicking into revenues the next quarter. However, we do not expect a full impact of such pass-throughs until the first quarter of 2023. Having said that, I end my remarks, and I will hand it over to Wolf. Please.