Light Sa S/Adr

Good afternoon everyone and welcome to Light's earnings call for the third quarter of 2020. My name is Rodrigo Vilela. I am in charge of IR and I am hosting this event which will be simultaneously translated into English. All you need to do is to click on the interpretation button on the lower part of your screen. So switching back to Portuguese now. This presentation will be done by our CFO and Investor Relations Officer, Roberto Barroso, and we also have the Chairman of the Board, Firmino Sampaio. Donato Castro, the recently elected CEO, could not be with us to date because he has tested positive for COVID-19 and is at home recovering. The presentation is available in our RI website and can also be seen here via Zoom. Right now, participants are connected in a listen only mode. After the presentation is concluded, we will have a questions and answers session when we will give further instructions. This webinar is being recorded and its audio will be available in our IR website. This is our disclaimer. We'd like to clarify that any declarations made during this presentation about the company's business perspectives as well as financial and operational goals are simply beliefs and assumptions by the company's directors based on currently available information. Future considerations are not a performance guarantee as they involve risks and certainties and assumptions. They refer to future events and therefore depend on circumstances which may or may not occur. Investors should understand that general economic conditions, industry conditions, and other operational factors can affect the future results for the company and can lead to results that will differ materially from those expressed in such forward-looking statements. Well, now that we've made our important notice, we will continue with Firmino Sampaio. You can continue, sir. good afternoon friends i am Firmino Sampaio i am the chairman of the board for light and i have been since october 8th i was elected as a board member in on september 28th many of you know my background in the brazilian electrical industry but the last activity I had in the market was as the chairman of the board for Equatorial Energy. Later, I was only a board member and chairman of the board of its subsidiaries, which was an activity I stepped away from in order to take this position at light. So it's a pleasure to introduce myself and to answer any questions that will be asked and I'm going to let Roberto Barroso also make his opening remarks and discuss the results for this quarter. Thank you and I'll be here with them to help with whatever is needed. Thank you. good afternoon everyone it's a pleasure to present our earnings results once again so I'll start with the presentation on slide two where we have our quarter highlights the third quarter of 2020 presented very positive results and they were consistent with our turnaround plan We also once again presented excellent service quality results. About the legal contingencies, we managed to make strides not only in management but also in servicing clients and in the company's litigation. we presented a reduction of 129 million in contingencies this quarter versus the second quarter of 2020 with some important contingency reversals resulting from labor lawsuits litigation with clients and also with management we also managed to get an excellent management result our opex results were positively impacted by the reduction of personnel and services. A 25 million BRRL reduction this quarter with a total reduction for the year of 64 million. There was a slight increase of 0.7 percentage points considering the total grid load. This was due to the temperature. The temperature this quarter was 1.2 degrees higher than the temperature in the third quarter of 2019. And also losses in the risk area. It's worth highlighting though that the losses in the possible area continued their downward trend. We managed to reduce about 50 gigawatts in possible areas with an increase of around 300 gigawatts in risk areas based on these three factors especially we were able to present an inevitable result of nearly 600 million brl an increase of 102 over the third quarter of 2019. this performance was 90 percent higher in the distribution company and 200 and uh five percent in the generating company we also continued our liability management with two important issuances for debentures and infrastructure which were concluded in June 2020 500 million and 600 million in the second quarter of 20 excuse me yes in the third quarter of 2020 we also received 1.2 million from the COVID account which reduced our leverage ratio to 2.4 times net debt to EBITDA most of our debt maturities have a limit of 3.75 times and finally the company's net income Reversed a recurring loss that we had of 11 million in the second quarter. Excuse me the third quarter in 2019 For our current income of 136 million, which is presented in the third quarter of 2020 Continuing with slide 3 This shows our operational indicators starting with the grid load and we managed to reverse a reduction of 16.5% in the grid load presented in the second quarter of 2020. This was because of the pandemic. And in the third quarter of 2020, we had an increase of 0.9% in grid load versus the same quarter last year. This was an increase mostly due to the temperature, which I've already mentioned, and also a recovery in industry. where the major highlight was steel work and the residential industry due to the use of air conditioning because of higher temperatures. Looking at the build market, the graph in the middle of the slide, there was a reduction of 3% there in comparison to last year. This reduction took place especially because of commercial clients who were impacted by the pandemic and had a reduction of 10% versus the third quarter of 2019. The right hand graph shows variations. The residential segment went up 9.5%, the industrial segment went up 7.9%, and the commercial segment led the reduction this quarter, a reduction of 10%. Continuing with slide four, here we see the losses I mentioned in the first slide, an increase of 7%, approximately 250 gigawatts this quarter. However, if we look at how much we've evolved this year, even despite the pandemic, we were able to reduce by 648 gigawatts the total loss for the company. We continue working on this, especially in areas we consider to be possible, areas where we don't have any severe operational limitations. We're still working strong in order to maintain this loss reduction ratio that we saw in the first and second quarters of 2020. Moving to slide number five, here we see the development of losses in possible areas. Another quarter of loss reduction, a reduction of 58 gigawatts. And in the last 12 months, we were able to reduce 1,248 gigawatts in the possible area. In the right hand graph, we see that we went from 16.8 total losses to grid load in possible areas to 14.5% In the third quarter of 2020. The same figure for the second quarter, which is a reduction of 2.3 percentage points in the last 12 months in possible areas. Just as a reminder, in risk areas, light losses are around 80%. And this has been stable over the last years. Moving on to slide 6. Here we see non-technical losses in the low voltage market. Because of the same effect due to increased temperatures and because we've had an increase of 2.3 degrees, especially in September 2020 versus September 2019, the non-invoiced value was lower. And this has led to a different level in October because of the reading cycles and this impacted losses. But the non invoiced revenue was recognized as. An indicator of the company's performance so. The losses went up 2 percentage points this quarter, but we continue to work in possible areas to. keep the same trend reducing these losses as we saw so far. Looking at the losses between possible areas and risk areas, we now have 67% of non-technical losses in the risk area and 33% in possible areas. When we look at gigawatts, it's basically the same number reported in the second quarter. 2,210 gigawatts, an increase of 9 gigawatts only versus the non-technical losses in the risk area reported in the second quarter of 2020. Moving on to slide number seven. Here we also have the evolution of the loss combat program. Again, We had a positive quarter. We were able to have 19,000 inspections. Using the months in which we could not cut power from clients who were delinquent, we used our teams for fraud inspections in clients in our concession area. So we had 19,000 inspections where we found fraud and we invoiced some retroactive values for clients who can pay. And this generated a volume of nearly 30% increase versus the volume presented in the second quarter of 2020. from the energy incorporation point of view which is our focus we also managed to make big steps in this time if we look at the third quarter last year this volume is nearly 2.4 times higher than in the third quarter of 2019 when it comes to energy incorporation so we're still focused on fighting losses in possible areas and we hope to continue in the next quarters not only in the possible area but also to try to advance some more in risk areas. This is a diagnosis that we've been doing over the last months and which we will discuss with Nonato and Firmino here in the company. When it comes to collection, we closed this quarter with a percentage of 94.9%. This is mostly due to the restrictions and power cuts by the regulators which took place until June. In August we worked on renegotiation of outstanding bills and from September we resumed power cuttings and we had around 9,000 cuts in the month of September, and we continue to work on that in September and October so that we can increase our collection. In September specifically, we got over 100% collection in a month, which gives us a sign that we are on the right path to collect what was not collected during the pandemic. due to that collection of 94.9% in the quarter, this reinforces our PDV, our bad debt provision, which went up from 3.3% to 3.8% in the third quarter of 2020. Moving on to slide eight, it discusses operational quality for our indicators. both DEC which is the frequency of interruptions and FEC which is the duration it continues to be very positive when we look at duration even in a warmer quarter we had a reduction versus June an improvement in quality and it reached 6.19 hours far below the Target we have in our concession contract, which is 8.14 and even below the indicator for 2021 and 2022. FEC is similar. We are over 20% below the concession contract limit. And we're also below the limits for 2021 and 2022. Moving on to slide 9. Here we see a summary of our operational performance. We managed to improve our EBITDA with 296 million recurring to 587, an increase of nearly 300 million BRL, which came from several parts of the company, an increase in net revenue, both for the distributor and the generator. Part of it is related to the New replacement value for BRR part of it is related to the 0.9% increase in the grid load GSF is down and we also have higher energy allocations in the generator for the third quarter besides that we also see that manageable expenses improved and even with the reinforcement of PDD, the reduction in bad debt provisions were enough to improve our operational results by nearly 50 million. We have to underscore that we are still in a pandemic. We had an impact in the distributor which was 52 million estimated by us of which 29 million was due to the 3% lower invoicing this quarter versus last year, an impact of $29 million in installment B and non-technical losses, and also a $23 million impact in our bad debt provision since we had to spend so many months without having any power cuts. Slide 10 shows our EBITDA growth in the third quarter of 2020 versus 2019. and this is per segment. This 296 million increase came mostly from the distributor. This was due to the items we've mentioned, contingencies and PMS, but a significant volume came from Light Energy and Light Comm, 103 million. This 103 million increase comes from our trade strategy and for a lower GSF and also reduced spot prices in the third quarter of 2020. Slide 11 shows the company's litigation and the provisioning we've made for it. We had a reduction of $129 million in provisioning this quarter versus the same quarter last year and a reduction of nearly $260 million in the first nine months of 2020 versus the first nine months of 2019. If you look at the right-hand graph, the green bars show the number of new lawsuits, and we can see that it is going down. It went down by 60% this quarter. So we can see that a part of it is related to the pandemic, but what really makes us feel confident that we are in a positive trend is that besides the 60% reduction in GEC litigation, we also had a reduction in complaints in our call center. It was 24% in the company's website and 24% in Aneal complaints. And this reinforces that downward trend we've seen in the last quarters. If we add the number of lawsuits in the second quarter with the number of new litigation in the third quarter, it's still far below what we saw in previous quarters. Looking at slide 12, we also see the company's financial results. There was a recurring net loss of 11 million in the third quarter last year, and we now had an increase of 36 million in the company's results. Most of the effect comes from operational efficiency which impacted our EBITDA this quarter and there was a reduction from a financial result led by IGPM increases. IGPM is the index that updates our GSF liabilities which are recorded by Light Energy. We currently have $800 million in Light Energy which have been recognized because of the litigation that we hope will conclude in the next months and we will settle these $800 million BRL with an EBITDA of 280 million which was the number CCEE disclosed which is still in a public hearing and can vary after the public hearing is concluded with an extended concession of 15 months in the case of light energy slide 13 shows what results we have had so far of the turnaround plan in the first nine months of 2020, and also the impacts we expect from the pandemic. We had an approximate gain of 15 million in reduced losses, 62 million in PMS reduction in the first nine months, and 135 in contingencies, a total of $212 million gained from the company's turnaround. However, the estimated impact from the pandemic is $116 million increased in the bad debt provision and also a loss of $148 million due to market reduction versus the same market last year. So our total is nearly 264 million BRL estimated from March to September. Slide 14 shows the company's cash position and its amortization. And we also see some of the company's financial highlights. Our cash position closed at 2.969 billion in September, which is enough for the amortization that we still have for 2020 and for all of the ones coming to term in 2021. We also reduced the debt cost for one more quarter. The nominal cost is under 7% on a consolidated basis and the real cost is 3.61% a year. which allows us to save cash in the first nine months of 2020 of around 200 million BRO. If we look at the covenant indicator in the first graph to your right, you'll see that there was a reduction of 3.7 times to 2.4 times. part of it is due to improved EBITDA in the third quarter of 2020 and part of it is due to receiving the COVID account which was 1.1 billion this quarter we suffered impacts from cash generation in the first three months of the pandemic and they were significant but now that we are able to cut power again and with the covet account coming in we've already stabilized the cash losses we had been having in the last months finally in terms of debt indexes we are still balanced in a mix between uh being that indexed by ipca and cdi 60 is indexed by the cdi at about 40 percent in ipca Finally, we'd like to reinforce that we continue to be committed to generating results for light. We're still engaged and committed to the progress of the turnaround program and we will continue making a constructive effort with regulators, with state governments to continue to improve our operations every quarter. Thank you and I will now give the floor to Rodrigo who will continue with the Q&A session. Thank you. Thank you, Barroso. Well, we will now begin the questions and answers session. If you'd like to ask a question, you can use the raise hand option on the lower part of your screen for your microphone to be opened. You can also write your questions through the Q&A button on the lower part of your screen. Once the question has been answered, excuse me, has been received, we will answer it here. The first question we've received came from the Q&A button and it was asked by Pedro Bonferdino from Goldman Sachs. How can you map which clients are able to pay? Pedro, thank you for your question. We've mapped clients that can afford to pay by looking at our regional plan and by following up not only losses, but also readings and charges. When we identify a fraud, since July 2019, we don't build them retroactively in the same way with every client. We look at the kind of residence, the kind of house, in what region clients are, and if they would be able to pay, for example, the last 24 months or the last 12 months. So by clustering clients, based on their payment history and by based on their readings after fraud has been identified we make an estimation on how many months we will charge them for and we've followed up that collection based on this clusterization is very positive but is it is a continuous effort and you have to follow up on the billing strategy for our EM clients our main focus has been in incorporating energy clients who had received power cuts where we presented a plan in December last year and brought them to our recurring payment base and we have over 300 clients where that happened. Excuse me, 300,000 clients where that happened. I'm not sure if I answered your question, but if you still have any questions, let us know. Bernardo Gomez from Itaewoo will now ask a question. So just unmute your microphone and everyone will be able to hear you. OK. You can continue. Well, I'd just like to thank Morozo for these excellent results. I think we're very happy about the results you've been getting, but that's basically it. I don't really have a question. Thank you, Bernardo. Marcelo Sa will ask the next question. He is an analyst from Itaú PBA. Hi everyone. My question is for Mr. Firmino Sampaio. If you could tell us what are the main fronts that the new administration intends to have with light if you're going to focus on getting uh better fees you know the last revision was very good for light and i imagine that this would be a point for the company to continue to be profitable in the future to have a better margin so i'm just wondering if you're focused on that for 2022 and if you could tell us the main changes that you intend for the company You have Nonato and I'm wondering if you're bringing in a team from Equatorial and how you intend to implement these changes. Thanks. Thank you. That's a very important question for me, Marcelo. My vision is that I found a light which was above my expectation from what I had seen before but none of it gives me the confidence that I can give you any numbers for the future. No, what we intend to do is to work to, you know, especially when someone from the operational side comes in like Nonato, we believe that this is going to add to our work. We're going to value what we have been doing in the company and we're going to perfect our processes in the complementarity model. I'm sure that Nonato will find many good things in the company, and he's going to bring many good things from his experience. We're not focused on capturing talent from Equatorial, but it's undeniable that Nonato's being here and some other employees who are close to us might find some opportunities here. My guidance for Nonato and for others is to first always look at your own resources in the company and we should not be biased towards you know, taking people away from other organizations, removing talents from other companies. But it will happen in some cases. No one can deny that. Donato is a great leader, someone you all know in the market. You know about his work in Pará and Piauí and in Maranhão in the past. It's something that draws our attention because he is a great leader. He's very warm and close to people. Although you can't be close during the pandemic, he is a great people person. So that is the example to follow. We're going to work on it first by doing our homework. you don't have to think that we need to always request things from annel and of course we have to reiterate that all of our relationship with annel is based on respect and we have to understand that any benefits that the market will see will be translated by them mathematically they have a mathematical model that will definitely work for light and for other utility companies that have the same challenges in operating so for me this is very positive the company is very lively it's ready for new challenges and we are bringing in a leader a well-trained professional and we will be together and I'm saying together because I I will be working exclusively for light. I'm going to stay in the company full-time, which is what I had been doing from the moment I was elected. I have a seat here next to the directors and I'm always going to do that. I want to talk about my experience in the electricity industry for a long time. I don't even want to mention how long I've been in the industry so people don't think I'm older than I am, but I have a lot of experience that I can tell you about. And of course, there's still a lot to capture. Learning is a very important variable for this position. Rio is also a life's project for Firmino. Rio is my second hometown. The state of Rio de Janeiro in 1992 gave me the privilege of being a citizen of the state. So I'm coming back here as happy as I ever have been. I like working, I love light, and I'm sure that my efforts will help the company to continue to shine bright for rio de janeiro and for brazil thank you from you know that was very clear so continuing with the questions we received in the q a tool we received two questions that are similar from ricardo pichino from taurus and from rodrigo mora from moneda They're asking if with Firmino coming into the company, if the company's turnaround strategy will be redesigned and how? Okay, that was a great question. I've been talking to some people in the company and I think the word turnaround is often repeated in the company. I was a board member in 1996 when the company was privatized. I had the privilege of transferring the company to the group when it was sold from the government. I was a board member I watched what EVF did at the time with CSN and with our other partners from abroad and from the industry. Later in 2008, I came back to the board. The company was run by Alkedis at the time and Equatorial integrated Rio Minas Energy, and each one had a 13% stake in the company and a control block of 25%. We shared with Semigi, with Fondolucci, and with G Concessions. It was a new experience. Equatorial stepped out later on. so we had four major shareholders which means that you know you can't get any individual guidance Equatorial understood that it wanted to control its assets and it sold at that time in 2010 it stepped away from light but The CEO at the time still liked Light. So this is the moment to come back to Light for the first time since 2010. But I do believe in the company and I'm sure that we are going to build the best for our shareholders and for clients in the state of Rio de Janeiro. Continuing with the next questions received in Q&A, Rodrigo Mora from Moneda is asking about the possibility of a follow-on. Rodrigo, thank you for your question. We're always looking at the opportunities for equity and for debt, but I think it's important to mention that so far we have not had any approvals from the board for any follow-on offers. If it is made, of course, it would help. because it would reduce the rollout cost and the capture cost for the debts that are coming to term in the next years. It would improve the company's capital structure and it could potentially lead to a better rating in the future. We know that these follow-on possibilities will be discussed with the Board and will only be carried out if it generates value for all shareholders. We also received a question from the Q&A tool from Juliano Agege from IBS. He's asking if you believe that Light's turnaround call is only focused on internal improvements, or is there anything to be done with ANEL so that the agency considers a higher level of non-technical losses? Thank you for your question, Juliano. I think the main effort we have to make is in the field. We have a well-designed plan that will be rediscussed now with Nonato and with the new board members who have recently joined us. However, we've also seen that Light's concessions department has deteriorated in the last years. Annel recently opened a public hearing to talk about the losses and what model will be used in the next price reviews. This is one of the most important links in our readjustment process. And we made a huge effort to study that and to contribute with Annel. We're constantly talking to them to provide suggestions on how the model can improve, but of course it's up to the regulators to define and to validate the model that will be used in all concessions. If the model represents the reality in each concession, then the loss level can go up if the concession area also is seen as more deteriorated. It's closely matched with the reality of each utility. It's something that can be feasible for the future. Still on regulations, Rodrigo Mora from Moneda is asking how conversations are going between light and the regulators about the financial economic balance. thank you for your question we've looked at the public consultation with anel we talked about it and we made our contributions with other distributors and now we're waiting for the directors of anel and all the technical department to make an assessment of the matter and to decide on it domenica noronha asks firmino to talk about uh plans that the board has with uh your still remaining participation such as bella montes okay dominica so My comment on this is that this is something that Barroza has been working on directly. The market knows about our position with these assets. We have two asset categories in generation. We have assets that were created by light in the past and those that were results from a financial investment where the company has a very small share this is still a topic in our agenda but the company is much more about controlling so focusing operations where you have full control of its operation and commercialization but I would not be able to answer this today I would need Bajosa to complement but we are paying attention to it there are many things to be done in the company itself and Investing in assets where you're only a financial investor is not a part of our strategy anymore. But I'd ask Bahozu to add some information. And I'm not sure how confidential this information is and how far along these decisions are. Bahozu? Thank you Firmino and thank you for your question Dominika. About our assets with shared control or with a minority stake, we still have the same strategy which is to divest. We already have an advisor contracted to get out of our participation with these three locations. We're working with potential investors for these three assets, and as soon as we have more advances in these three projects, we'll communicate it to the market. But we have been saying for a few quarters that we are working on selling these three assets so that we can focus, as Firmino said, on what has generated the most value for us, which is generation and light energy in trading, Litecom, and also the distributor. These three assets are over 90% of our EBITDA, and this is where our management is focused on. Our plan to divest non-core assets will continue and we are still working on that, so thank you. Juan Pimentel from BTG Pactual and Eduardo Varela have similar questions. They ask about recent statements made on the possibility of going into investments in infrastructure. For example, sanitation. So does the company have any plans to invest outside power distribution and generation? well thank you for your question right now on the board we are focused 100 in the distribution and generation segment but it's important to highlight that light is a company that has operated in utilities for over 100 years and it knows this area very well so if there are any synergies in the future they might be discussed by our board, but right now we are 100% focused on getting our value from distribution and generation. I'd like to add something. So today it would be a different situation if the chairman of the board was looking at M&A's and new assets. I think the word turnaround is always in our minds. So we need to improve our operational management, which is something that the market has been demanding consistently and permanently. So we will get ready for the future. Many of the opportunities we will need to say no to. you have to know what companies you have inside your own company and which you haven't achieved yet. In other words, what are the best results I can have by buying new assets or by recovering the ones I already have in the company? So before doing anything, we still have a lot to do in the company. When we look at the number of clients in risk areas, I would rather not say that these are lost clients I always say that these are clients to be conquered and this is the message for the new managers right this is the new mission for them although this mission had already existed we need to talk to the federal government to state governments and city governments so that we can move forward bringing these clients into the company's operations. They're important and they're a part of the history of Rio de Janeiro. And they're not available for any newcomers. We want to recover the authority of this concession. And that means that we need to reach our clients, have better operational results, and fight energy losses. And we need to recover our receivables. You've seen in the company's reports the level of losses that we've been able to recover in the market. But we need to make a huge effort so that shareholders can bring back the capital that is out there without needing to resort to violent action with our clients. All of our clients are important. Our 4.4 million clients are a part of our history. So any organization needs to look at all of their clients. This is our mission. This is our effort to take quality energy and to bring it to all of Rio de Janeiro. And of course, pay attention to the demands of society. We're going to build this company together and you know, honor our 115 year tradition. We want to continue to be a part of Rio de Janeiro's history. This is the last question. Marcio from Capital is asking. Hi Rodrigo, can you hear me? Yes. Hi Firmino and Barroso. Firmino, I've been listening to the call and you mentioned that you're coming back to light and you see the company doing better than what you expected when you weren't in the company. So my question to you is, given the challenges that the company has, especially fighting losses and delinquency, You say that the company is doing better. So I imagine that some of the initiatives that the company took in the last years have been good and correct. But my question to you is, if there's anything good that was being done, if anything was being done correctly, are we facing a structural issue? And maybe the only way out of it would be regulations. And, you know, light already has one of the highest prices in Brazil. So the traditional regulatory area would make people who are footing the bill in Rio have to pay more. So is the path maybe to have a national solution maybe socializing these losses through any sort of taxes? What do you think? Marcio, I think you answered your question to an extent. If we don't do our homework, there's not a lot we can do. We don't have as much authority for an outside charge. I always remember in conversations I've had with people that only Tomé de Souza, the first governor of Brazil, had the privilege of not speaking ill of their predecessors. While first I don't mean to speak ill of anyone, I have to recognize what has been well done and what still needs to be done. So, of course the concession had to go through economic recoveries, And this was affected once again by the pandemic, but the market has made demands on the company. The company did need to improve its operational results. So this is what we mean to do. This is our mission. regulations and you talked about your concerns about the price of energy there are some components that can balance it out i don't need to name what but our prices are not the highest so there is some space but we would not want to do that what we want to do is to fight loss is understanding what's happening in the state where what we call parallel power has been moving forward in the years in which creates challenges for us we're part of the solution we want to help the state and we don't want that this We don't want this to be an enormous problem for Light. You know, we're having public hearings, we're hearing from each company, and we want ANEL to define what algorithm will guide its work so that when we implement our actions and the actions of other utilities, we have a number. Our belief is that it will be very difficult for it to be lower than the current number. because it reflects our society. Power distribution is a condominial activity. Whatever leaks you might have, you know, whoever is not paying their due in this condominium means that, you know, that outstanding amount will be split among others. And we want that to be reduced with other clients with other agencies which are not in permanent contributions but you know it's a lot of perspiration we already have a lot of inspiration in the company but it's not about being a new management it's about continuing to add new bricks to a building this is expected by our entire society and you can be sure that we will be on this together working and it won't you know be in vain that we're stepping out of our comfort zone I left the company I worked for previously to face challenges and I'm still moved by challenges I think I'm not the only one I think all of my colleagues here at light are moved by challenges and we have to believe that tomorrow will be better than today that you know the pandemic is going to be over and we'll recover everything we lost after another interruption in our value creation process one of the most critical things in light is not what I is still to be done but how we are changing the way we do things so there's nothing that needs to be done that should not be enjoyed we're not going to waste our good experience we're going to learn from them and we're going to work to build what can be better for the society in Rio de Janeiro, for our shareholders and for all the stakeholders involved in our business. I'm sure that Annelle will recognize the company's efforts. The efforts that everyone has made to build a better world and we're delivering a lot of it in quality. Our biggest challenge is moving forward in losses and collections, but a company needs profits to keep itself afloat. It needs to have cash above what it can disperse every day, not only knocking on the doors of shareholders or crying to an L. We have to do our best to build a solid company. And I hope you will all believe in us and continue investing in our company. Thank you. Well, everyone, I'd like to thank you all for listening. As a reminder, Firmino Barroso and all the company's directors are available if you have any further questions and we'll always have the utmost pleasure in keeping the lines open with you. Once again, thank you and I hope we can talk soon. Have a great afternoon.