Hypera Sa S/Adr

Ladies and gentlemen, welcome to Hipera Farmers Q2 2020 Fee Earnings Conference. Joining us today are the company's CEO, Mr. Brenner Oliveira, and its IRO, Mr. Adel Mario Cota. We'd like to inform you that this event is being recorded and will be available for replay at the company's investor relations website at ri.hipera.com.br. We'd like to please be advised that during the conference presentation, all participants will be connected in viewer-only mode. Following that, the floor will be open for questions and further instructions will be provided. Before we move on, we'd like to underscore that the information shared during this conference may include projections and forward-looking statements. Such information is subject to known and unknown risks and uncertainties that may cause said statements to not materialize or ultimately prove to be materially different than expected. I will now hand over to Mr. Brenna Oliveira, who will start the presentation. Mr. Oliveira, please proceed. Good morning and thank you for joining our Q2 23 earnings conference. I would like to start the presentation by talking about our growth on slide 30. This quarter, we reported a 9% increase in sellout, largely benefiting from the performance of our company's important power brands as well as recent launches. Our sell-out performance in this quarter was driven by the strong year-on-year surge recorded in June of last year, when we grew 33% over June 2021. That way, we outperformed the market by 10 percentage points, thanks to our inventory policies for raw materials in-house and finished products in customer premises. That ensured our products supplied to pharmacies at a time of medicine shortages in Brazil. Our sellout CAGR in turn for the last two years came to 17% this quarter, which was 0.4 percentage points more than the market. That reflected the accelerated pace of new product launches in recent years and the latest investments in our leading brands as well as our increased production capacity. In this quarter, we are also reporting net revenue growth of 18% and continued operations EBITDA of 16%, which contributed to our unprecedented operational cash generation for a second half of the year at 578 million reais. Talking of new product launches, we maintained our strategy of expanding our portfolio this quarter, adding a host of important products to our lineup as shown on slide 4. We had new products come out of all our business units, most notably line extensions for the brands Bifilac, Tamarine, Maracujina, Coristina, and Pialas. the institutional market continues to grow substantially, gaining increasingly more relevance in our business. This quarter, this unit added a lot to our business, growing by 55% over one year earlier, excluding the non-recurring immunoglobulin sales recorded mainly in Q2 of last year. Also in this quarter, We approved the payment of $195 million in interest on capital, or 31 cents per share, in line with our current shareholder yield strategy. We also saw the new makeup of our board of directors, proposed by the company at its general meeting, accepted, which we will discuss in slide 5. We welcomed new independent members Eliana Kementi, partner-in-law for Machado Mayor and member of the Chamber of Market Arbitration, and Mauro Cunha, former president of IBGC and AMAC, and who has sat on important boards of directors in Brazil for more than 20 years. The arrival of Eliana and Mario falls in with the company's strategy of constantly improving its board of directors governance, seeking to complement the profiles and the skills of its members. Now, moving on to the other highlights of this quarter, on slide 6, we've published our 2022 Integrated Annual Report, which presents the company's highlights and its most important environmental, social, and economic initiatives. We were again certified as a great place to work in Brazil. And we were also prominently featured in the 20th edition of Estoway Dinero Magazine's ranking of the most valuable brands in the country. The list included 20 consumer brands in its 50 most valuable group, six of which were Hypera Pharma's, Neokimica, Coristina D, Benegrip, Engov, Doriel, and Yuzaldina. Lastly, we concluded the acquisition of the Behringer plant in the state of Sao Paulo. The new factory will add 10 production lines and a warehouse with 11,000 pallet positions, which will help to expand our production capacity and internalize production for the brands we've recently acquired from Takeda and Senafi. in addition to the Buscopan family acquired from Beringer itself, that will continue to be produced in that plant. I will now turn over to Adelmario, who will discuss our financial results in greater detail, starting on slide 7. Thank you, Brenno, and good morning, everyone. This quarter, we saw a sales growth of 18% over Q2 2022. In the first six months of the year, 16% growth, which accounted for 46% of our guidance. This was very much in line with the seasonal period on record for the previous years. We also saw an average increase of about 7% after the pricing update that we ran at the beginning of the year. We should highlight the relevance of our recent releases to keep the company alive. important, considering that the last few products we launched accounted for 75 of our added revenue in this quarter. When you look at a longer term, the products launched in the last five years would account for nearly one-fourth of Hipera's total revenue, including the recent launches. Even though we launched in all of our categories, most of them were in gynecology, orthopedics, gastroenterology, central nervous system, and cardiology. These are very important categories and are still in line with our strategy of developing our pipeline focused mostly on new therapies for chronic and continued use therapies. As for profitability, our gross margin was at around 63%, with a positive impact with the reduced production cost, lower cost on manufacturing and raw material, as well as products. But these effects were not enough to offset the one-off impact referring to the shutdown in the plant early this year. Abbott at this quarter, excluding other brands, was $700 million, growing by over 15%, with a margin close to 35%. The highlights here were a more significant SG&A increase, given the increased infrastructure and investment in our B2B structure. as well as a 25% increase in R&D investments, also in line with our sustainable growth strategy by developing our innovation pipeline. As a result, our net profit this quarter exceeded $500 million, up 11% over one year earlier. Now about our cash flow and debt level. Our operational cash flow exceeded $40 million what we had the same period last year, even when we consider the even higher investment in working capital during this quarter. We are now starting to see a decrease in inventory figures, higher consumer sales, and a decrease in accounts receivable when compared with the first quarter. Our suppliers' accounts also decrease as we reduce our raw material purchases with longer payment terms. As we mentioned in our Q1 earnings conference, we're continuing to work to normalize our working capital levels, which will help us to roll over our cash generation over the next few quarters. Nevertheless, this cash generation was more than enough to cover our CapEx investments and our investment in new products, which add up to $345 million in free cash flow during this period. There was no significant debt amortization during this quarter, and the overall payment of interest was $255 million, capturing over $1 billion new funding with an average payment term of a year and a half. As a result, we ended the quarter with a cash position of over $2 million. with a net debt at the same level as it was at the end of the last quarter, 2.5 times the EBITDA stipulated in our guidance for 2023. I will now turn over to Breno for his final remarks. Thank you, Adelmario. So we've come to the middle of the year, and I'm still very confident we will fulfill the guidance we submitted for 2023. In addition to that, we are moving forward with our initiatives to gradually reduce our inventory levels, as Adelmario mentioned. Our medium-term strategy is to combine solid revenue growth with profitability and reduce working capital investments. With that, we're seeking to elevate the conversion of our results in cash generation, reducing our investment, and focusing on our return on invested capital. The foundation that's necessary for us to grow sustainably is in place with good profitability in the Brazilian pharmaceutical market, and our focus is to move forward. I'd like to thank everyone for joining, and let's now open the floor for questions. Thank you. We will now begin the Q&A session for investors and analysts. If you have a question, please press the raise hand button. If your question is answered, you may leave the queue by clicking the same button.

Please wait as we pull for questions.

The first question comes from Vinicius de Guerrero with ICAO BBA. Please, sir, your microphone is already released. Thank you. Thank you, everyone, for taking my question. So I'd like to go over very quickly three different topics. First of all, I'd like to understand the revenue growth trend. You mentioned the very strong results you have had in the consumer goods segment, and some of this is not included in the sellout rate. If you could talk a little bit about how much this accounts for in terms of growth and revenue whether this is something that stands out in your sell-in and sell-out dynamics that the market is so interested in. The second topic would be about your working capital trend. You've already shown an improvement in the supplier dynamics, but it seems like there's an opportunity for the supplier's line of credit. And Brenna started talking about internalizing costs. So to you, Should that bring some improvement in that supplier's line? And third, do you expect to see an advance? and the teens for sellout considering that in the second half of the year or even in July already, you're already seeing some new products coming in very strongly and more of a comparable basis for comparison. So I'd like to understand more of that. Thank you. I will answer your first and third questions and Adol Mario will take your second question, okay? So the revenue trend which doesn't measure considering the additional and same organic and bio age which are not in the pharmaceutical channel as well as other lines such as the food business, they account for about 10 to 15% of our revenue depending on the quarter. That's sort of the ballpark. And as we've shown with the sellout figures, which were slightly lower than we initially expected, In other markets, we are seeing them outperform what we expected both in the food market and with the release of InGov after. These industry segments have brought us positive surprises of setting the slightly lower sellout rate compared to what we expected initially in pharmaceutical retail. And I think that your third question has a lot to do with that. You mentioned the basis for comparison. Now, as you said, looking at Q1 of 2022 was very strong, especially Q2, as I mentioned. In June, we grew by 33%. But when we look at the A real rate of growth in Q1 to have the same CAGR of about 17%, that would mean achieving a number in the big teens or recording a number in the big teens in the second half of the year. So that way we would have a level that's comparable to the single digits rate we recorded in the first half of the year. So in short, we are confident. You also asked about June where we had a strong basis for comparison. We grew by about 20% in June of last year, but that's also accounted for in our guidance. Now, I'll turn over to Mario now to take your second question. Hi, Vinicius. How are you? Now, going over some of our main accounts and working capital for the rest of 2023, in terms of accounts receivable, there should be no major change. We are continuing to pursue our policy of working with around 100 days in inventory on average. And that's a proxy for our accounts receivable. But when we look at our payable accounts, and especially inventory, we expect to see a significant decrease in inventory over the course of the year until early 2024. As we lower these levels, particularly by buying less raw material, which is where we have a few KPRs, to keep the safety level, which had been raised for some time. But that will also have an effect on our supplier's account. seeing as these raw material suppliers offer us the longest payment terms. So as we reduce our purchases, it's only natural that they will reduce their payment terms as well. With Behringer's new plant, which we concluded the acquisition for in July, we will now begin to internalize the brands that we've acquired from Sanofi and Takeda. We expect to have internalized 100% of Buscopan by the end of this year. By mid-next year, we should also internalize the brands that we've acquired from Sanofi, and then the Takeda brands will have the internalization concluded by 2025. And we also expect to see some gains in working capital after that internalization of brands. So Sanofi and Takeda continue to produce for us. We have the average payment term of about 60 days. And as we internalize them, we'll be able to extend those payment terms very much in line with what we currently have with our existing portfolio. So, we should see some gains on that front, but mostly in 2024 and 2025 in the case of those newly acquired brands. Perfect. That was very clear. Thank you, Breno and Alomario, and have a great day. Thank you, and have a great day as well. Our next question comes from Mauricio Cepeda with Crédit Suisse. Please, Mr. Cepeda, you may proceed. Hello, Bruno and Mario. Good morning and thank you for the space here. I have two questions for you. First of all, if you could update us on non-retail. How is the institutional specific portfolio doing? How is the licensing and registering process going? When do you expect to have an institutional specific portfolio to come in to help with your top line? These sales that you were doing to non-retail, is that actually to the non-institutional sector or is it the government channel? That's the first question about non-retail. And my second question is, I understand that the tax on ICMS benefits seem to have reached consensus, but it's already in the news that the government would like to try some alternatives to try to collect taxes on those benefits, considering how relevant that is to the economy. So I would like to hear what you guys have been monitoring in that sense and how that will affect your systems moving forward. Thank you. Good morning, Satheta. This is Brenno speaking. Now, about the institutional industry, you asked about how the portfolio is moving. Well, I can say that it's growing as planned. We have an even longer portfolio than we expected when we drafted the business plan for the business nearly two years ago. Initially, we had mapped out 70 molecules in our pipeline, and we have about 100 molecules molecules mapped out right now 40 give or take of which includes specific projects with a time frame that's already been established but we have virtually no significant income coming in or playing into these figures that we have shown you these are still coming from the portfolio of virtually the oral products that we have. A few things such as Dramin Shots, and we can still allocate sales of these products, but it's very much based on the HIPERA's basic portfolio. So we have this pipeline that's coming in. We imagine starting next year when we believe we should have some more significant products coming in. So it's a very positive outlook. We are very, very happy with the investments we've made by creating this new business unit. Everything is on track. We're even exceeding our expectations. Now, about your second question with regard to the tax on some of these benefits, we still need some details about what happens. where the government's mind is at, but we have been discussing with the tax experts that help us and advise us, and so far we believe there should be no impact on our business. We're talking about a presumed credit benefit. So we make allowances for those profits, so we see no risk coming from that at this point. That was perfect, Brenno. Thank you very much. Our next question comes from Joseph Giordano with JP Morgan. Mr. Giordano, your microphone can be open now. Hello, good morning, everyone. Good morning, Brando, Adel, Mario, and thank you for taking my question. I would like to go back to the institutional market issue. We saw there was an incremental investment on your sales expenses coming from that line of business, and I would like to understand whether that is a sufficiently large structure to move forward with that project. And looking at your growth rate, it is slightly above what we expected. So I would like to understand whether you're ahead of schedule in that sense or not. And also going back to working capital, we see a large number of APIs. And I would like to hear from you how that should be normalized throughout the year. We see that trend with suppliers despite the positive surprise from your working capital. Thank you. Hi, Giordano. How are you? Well, to your point about the institutional market, just as I said when answering the last question, this is slightly above what we expected in terms of growth. and we still do not see such great an impact from our new products. This was about better positioning Hypera's existing brands both in the government front and in the private front with private hospitals. We have been setting up the structure. It is not fully ready yet, but as we grow our revenue, we will expand that structure. So essentially what we have currently is a sales team that's dedicated to the institutional market. We have a small number of agents that are visiting hospitals, but this is still a small structure. So there is room to grow. and for us to increase our focus on that segment. But that is just – that will take place as our portfolio increases as well. And I think El Mario can take your working capital question. Hi, Gio. Good morning. I don't know if I understood your question well, but I guess you want to know what the expectation for the APIs, yeah, the API consumption for the next few years. Well, our target here is to move back to the regular levels that we saw way back when, before the pandemic essentially. Back then, if you look back, you can see that historical leverage that's close to 50% of our cost when it comes to inventory. And that's the target we're working towards now. And we should see that return over the next few months. We're talking about probably Q1 and Q2 2024. By then, we should be closer to that level. And as Mario said, this is 50% of our total inventory, not just API. That will be about 50% of CAGR. That's our target and a level that we believe we'll be able to return to within a 9 to 12 month time frame. Okay, that was perfect. Thank you. Our next question comes from Vinicius Strano with UBS. Please, Mr. Strano, your microphone can be activated now. Good morning, everyone, and thank you for taking my question. I'd like to explore the gross margin issue. How much do you expect to realize in terms of benefits coming from the exchange pressure and also with regard to your plant capacity moving forward? Also, if you could talk a little bit about how the gross margin will be working moving forward, that would be great. Hi, Vinicius. Good morning. For the currency appreciation that we're seeing right now, we expect to see an impact later this year and earlier next year. Just to remind everyone, we have a hedging policy. We are more or less hedged until the end of October considering the profits we have for purchases moving forward. And we are now working with the average of $5 to $1. So we are not increasing our hedge position. We are keeping what we currently have. And for future purchases, we should be able to work with the lower exchange rate, bearing in mind that it should take a little bit longer for that to affect our costs, considering our current inventory levels. We first need to lower those levels, and then what we're buying today will begin to see those cost effects probably at the beginning of next year. Considering the current exchange rate close to 4.8 BRL to USD, all else the same. considering the mix and API costs, we should have about an impact of about 1.2% on our gross margin. But this should play into the accounts more closer to the beginning of next year. As to your other question, I think it was more of a one-off effect because of the shutdown we saw early in April. But that should have no major impact on our results for the next half of the year, or for this half of the year, rather. And as for gross margin, we can't break down the margin per segment, but the gross margin for the institutional market is much lower than that for the company at large. Bear in mind that in the case of the institutional market, we have no substantial expense in terms of marketing or advertising. So our gross margin is very close to our EBITDA margin in that case. Unlike it is for our other businesses, especially our retail brands, ATC, prescription brands, skin care, where we have significantly wider margins, far wider than those for the company at large, but there is great sales overhead. That was perfect. Thank you. Thank you. Our next question comes from Bob Ford with Bank of America. Mr. Ford, you can now activate your microphone. Good morning, and thank you for taking my questions. Could you talk a little bit about the success of this year's pipeline and how it stacks up to your historical performance? And because there are new products that have come to the market, How would that process look like? And also in terms of sales and pipeline and the organic, on the organic side, how does that look like? Good morning, Bob. I think I was able to understand all your questions, but if I forget anything, please let me know. Well, about our pipeline, we're seeing significant development, we continue to add new projects to our pipeline. We have over 400 projects underway. And I think that in terms of new product launches, what we are seeing is that More and more, these new products have become important to the company's growth, even more so than we expected. And when we look at how these newly launched products have performed, they are still very much in line with the business cases that we approve and with the updates we have as we develop those projects and also just before they are put on the market. So it is very much in line with expectations, but I think it's gaining more and more relevance as we increase not only the number of product launches, but also their relevance to our pipeline, which moving forward should have projects that are even more important with greater potential, so to speak. You also asked about Bionormous' pipeline. Bionormous currently has 10 PDPs. They're already being sold and marketed. The company is also working to add new products from that line to your portfolio. This PDP program was at a standstill throughout the last administration, but there's the expectation that the program will be reactivated with new BDPs. I think our portfolio has been seeing great development. We should see it account for about 20% of our revenue. And we also expect improved margins, which should be even more substantial next year as the company begins to produce the first product that it internalized which is a fixed mormy and that's to provide a an improvement in our margin starting next year so we are still very confident and very happy with a b enormous results this is a company that allows us to offer high added value biological products that we don't currently have in development within the company. Thank you. Hello, Mario. And why Sync Organic? Well, we think that Sync Organic is still in a very significant upward trend as well. It's growing by over three times this year when we consider the sales in Q2 compared with one year earlier. So it should become a power brand by the end of the year, selling over 100 million reais. So it is exceeding our expectations, actually. Congratulations and thank you. Thank you, Bob. Our next question comes from Mr. Leandro Bastos with Citi. Please, Leandro, you can activate your microphone now. Hi, everyone. Good morning. I have two questions. First of all, I'd like to follow up on the first question you guys took. You mentioned that you should accelerate your sellout rate to 15 in the second half of the year. I just did not understand... how the interest rates will play into that. You mentioned that it's been challenging and you should see an acceleration in your basis. That's my first question. And my second is about working capital. But looking at accounts receivable, there's been... a sequence of increases, but in year-over-year terms, it was still pressured. So if you could talk a little bit about how you see the inventory in this channel and how you plan to overcome this challenge in working capital moving forward. Alejandro, well, about sellout, we don't really want to talk about the very short-term What we heard is that the market is growing by about 11%. That was the last forecast from Octavia. And we are close to that level, I can say. I don't know if that was your question or if there was anything else you'd like to know. Bearing in mind that this is compared to a very strong basis. In June of last year, we grew about 20%, whereas the market had grown about 16%. So, very healthy performance in compounded terms both for us and the market at large. Leandro, about working capital, I think you were more focused on accounts receivable. There was no change. Our policy remains the same. So on average, we should stay with 100 days in accounts receivable and 100 days in inventory for that channel. And a few quarters, we should stay a little bit higher than that. But over the course of 12 months, our goal is to stay on or around those 100 days. I think it's also important to say that, for example, this quarter, pharma retail was slightly higher because of the slightly lower sellout than expected. But in year-over-year term, this also sales to other channels, which accounts for 10% to 15% to the military and institutional channel, where our inventory levels were even slightly lower than that. So we should also take into account our other companies, Cinta, POH. These are companies that do not have those inventories on the channel. They sell directly to consumers. So inventory issues are less significant. And as they become more relevant to the company's overall sales figures, we should see even a decrease in those inventory levels. Great, guys. That was perfect. Thank you and have a great day. Thank you. Our next question comes from Gabriela Ferrante with Safra. Please, Ms. Ferrante, your microphone can be activated now. Good morning, everyone. We have two questions as well. I'd like to understand what you expect to invest in R&D in the next quarter and also the total number of new product launches for the quarter and the year. and also the increase that you saw considering net revenue, and if you see that as a trend for the next quarter. Thank you. Hi, Gabriela. We have no guidance in terms of R&D. or new product launches or pipeline, for that matter. But you shouldn't expect anything that's much different to what we've introduced in the last few quarters. There's not much of a seasonal impact. We saw about 25% investment in R&D, and it should be – No different than that in Q3. And as for revenue, the most significant impact was our Hypera partnership, our B2B platform. We've actually been scaling up that platform and increasing investments in that, both in terms of infrastructure and on the digital side, the software. We've been working to improve that software platform. But in addition to that, this is a platform that's increasingly more of a relevant channel for us and we've invested and we've been investing to increase its relevance. But this was all according to plan already. That was perfect. Thank you. Thank you. Our next question comes from Emerson Vieira with Goldman Sachs. Mr. Vieira, your microphone can be activated now. Good morning, Brenno and Elomario and other directors. Thank you for giving me this space. I have two questions. First of all, I'd like to once again explore your top line. You mentioned sellout in pharmaceutical companies. retail that was slightly below the expected. When you look at the contribution from your new product launches, we saw a growth rate that's slightly below the average rate. In your opinion, what explains this slightly below the expected performance? Was it a lack of inventory at the point of sale, or is it a competition issue? So if you could explore that, I would really appreciate it. And my second question has to do with working capital. I would like to understand what's the impact from the institutional channel in accounts receivable and suppliers.

Those are my two questions, guys. Thank you. Hi, Emerson.

I'll take your first question and I'll let Adelmario take your second one. As we said, I think the most significant impact here comes from the basis for comparison. The first half of last year was very, very positive, especially Q1. It was very difficult to gauge when it came to our prospects. The market had a very unusual performance last year, but this was largely because of the acute use medications where the market – for them decreased and slowed down from their peak of last year. And as I mentioned in my initial remarks, we were very well positioned in the market last year, unlike much of our competition. So better positioned than the competition in our most important categories. And now as demand moves back to normal and our competition begins to replenish their supplies as well, We are seeing our performance be slightly worse than expected because of all of that. But again, this is still within the expected. But we were also fortunate enough that the small part of our pipeline that is not considered within retail is doing much better than we expected and mitigating those negative effects. And maybe an additional point, last year, our sellout rate had grown by about 25% in Q2-22. And our retail sell-in rate, excluding institutional and excluding the food channel and the B2C brands, grew by about 16%. So, our sell-in grew nine points less than sell-out. And this quarter, what we saw was a reversal in that. In the same basis for comparison, it grew by 19% excluding simple organic bio-age and food and institutional. So, sell-out grew 10 points more than that. So, essentially, it's a return, a replenishment of our inventories, which was really low in Q2-22, but We already expected to see that type of performance. I don't know if I made myself clear. That was perfectly clear. Thank you. Emerson, to your point about the working capital on the institutional channel, as Breno mentioned, what we're working on for the institutional channel is the same portfolio that we have with NeoChemica. which are essentially the oral products. So there's no significant difference today when it comes to the sales terms of negotiation, whether in terms of payment terms or inventory. It's not that different from the rest. And also with suppliers, there's not a great difference considering it's the same portfolio. Also, the representativeness of the institutional channel accounts for less than 25% of our sales, so still not enough to change substantially the company's working capital. Perfect. Perfectly clear, Abel Mario. Thank you. Thank you. Our next question comes from Arthur Alves with Morgan Stanley. Mr. Alves, please, you may proceed. Hello, everyone. Good morning, Brenno and Uncle Mario. I also have two questions very quickly. First of all, how are you looking at the anti-flu medicine sales this quarter, considering that we have had a lower incidence of the flu for two years? Are you seeing any impact of that on your sales this quarter, and what can we expect for Q3? And also, do you have any – indication with your JCP registry? Do you have people talking in that sense?

Thank you.

Well, Arthur, I will talk about the JCP first, and then Adelmario can go over the anti-flu medications. Well, we are keeping track of the news and what we hear when we talk with our tax attorneys is that this measure or what's most likely to pass in Congress is an overhaul of the individual tax. So a decrease in corporate tax rates. there's more recent news of the government talking specifically about JCP and what we hear from our experts is that it's very unlikely to see any change in JCP alone without any change in the other fronts such as dividends and corporate tax. But we are keeping track of that, but we do not have any information in addition to what we're hearing on the news. But if there is any change, we will make the necessary adjustments and think about how to best use our capital. At this point, it is interesting for us to pay for the JCP, which has that tax shield. But if there's any change, we will rethink how to use those resources in a most efficient way. Hi, good morning. With regard to the anti-flu medications, we are keeping a close eye on what the demand is moving forward, not only with anti-flu, but everything relating to flu symptoms, painkillers, antihistaminic medication. And what we're seeing this year is a return to normal. when it comes to the flu season, which is more common at the end of Q2 and early Q3. And what we're seeing is the levels return to very closely what they were in 2020, before 2020. It's not that people are not... requiring so much of those types of medication, but the demand is going back to what we saw as normal before the pandemic. And we continue to invest in that market, investing in making our brands more and more relevant in our points of sales and the media, also innovating the most important brands in our portfolio. So we have three new SKUs for Benegripay. We had a very important new product launch in the anti-flu lineup this quarter. We launched a new line extension for Coristina, and these have performed really well and helped us to gain market share. But naturally, when we compare that to our performance in 2021 and 2022, We are still working with lower levels, seeing as we didn't have those peaks in COVID incidents during the last few quarters, and we do not expect to see them either in the second half of the year. So it's a lower demand for those lines of treatment, but in line with what we used to see before the pandemic. That was perfect, guys. Thank you. Thank you. Our question and answer session is now concluded, and I will turn it over to Mr. Brenna Oliveira for the company's final remarks. Mr. Oliveira, please, you may proceed. Well, I'd like to thank everyone for joining us. Thank you for your interest and your questions, and I'd like to say that our IR team is available if you have any additional questions. Thank you very much, and have a great day, everyone.