Magazine Luiza U/Adr

So you've got to let me know Should I stay or should I go? It's always tease, tease, tease You're happy when I'm on my knees One day it's fine, the next it's black So if you want me off your back Well come on and let me know

The Mangalu conference will begin in a few moments. Good morning everyone. Thank you for waiting. Welcome to Magalu's teleconference about the quarterly results. For those who need simultaneous translation, just click on the interpretation button through the globe icon at the bottom of the screen and choose your preferred language, English or Portuguese. We inform you that this event is being recorded and will be available on the company's RI website at ri.magazineluiza.com.br. Where you can find the release of results and the presentation, both in the Portuguese and English versions. The link for the presentation in English is also available in the chat. During the presentation, all participants will have their microphones disabled. Next, we will start the Q&A session. To ask questions, click on the Q&A icon at the bottom of your screen. Write your name, company and language of the question. When it is announced, a request to activate your microphone will appear on the screen and then you must activate the microphone to continue with the question. The questions received by subscribers will be answered later by the team of relationships with investors. I would now like to give the floor to Fred Trajano, CEO of Magalu. Please, Fred, you can start.

Good morning everyone. Thank you very much for participating in our results call for the second quarter of 2026. Once again, I am here with all the executive directors and vertical leaders of Magalu, of the Magalu ecosystem, to answer your questions at the end of our presentation. Well, as we said in the first call this year, in 2026 we entered the new strategic cycle of Magalu, after the digitalization cycle and the diversification cycle and the creation of the ecosystem, and in this new cycle we defined some value creation pillars. I put these pillars of two big blocks. The first block is to consolidate our omnichannel leadership with IA, basically a block dedicated to all our retail assets. And the second block is to accelerate the monetization of services through the growth of our services platforms, of the companies and many others that we bought or built in this ecosystem cycle. In the first block, which is the block to consolidate Omnichannel leadership, we have extremely clear initiatives and we had advances in practically all of them already in the first half of the year. A highlight here to accelerate the growth of physical stores, not only for durable goods, but also for other group companies such as Netshoes, Epoca Cosméticos, Kabum, e até a estante virtual também que a gente abriu a primeira unidade com a Galeria Magalu. Nós tivemos um tri, um primeiro semestre muito bom, mas especialmente o segundo tri foi um tri excepcional do ponto de vista de lojas físicas. Retomamos a abertura de lojas físicas com a unidade de Ceilândia e tivemos também a inauguração da Galeria Magalu no final do ano passado, que está indo André Matricardi, Julio Cesar Trajano André Matricardi, Julio Cesar Trajano We have two ways to do this, in the short term and more in the medium and long term. In the short term, the way we found to resume online growth is by forming partnerships with third-party platforms. We announced a partnership specifically in the second quarter. A gente começou a operar em junho, mas tivemos o mês de julho, que é a parceria com a Amazon, e como eu vou falar um pouco mais pra frente e descrever ela, nós devemos anunciar novas parcerias aí ao longo dos próximos meses, tá? Ou até das próximas semanas. Então, também vemos um caminho aqui, ao disponibilizar a nossa gama de produtos Sumpay em plataformas terceiras, a gente acredita que a gente vai conseguir retomar o crescimento online, André Matricardi, Julio Cesar Trajano Inacio Rodrigues, André Matricardi, Julio Cesar Trajano E o terceiro é redefinir o posicionamento digital com experiência de curadoria e, principalmente, com AI. Nós lançamos no final do ano passado duas grandes inovações. Uma foi a Galeria Magalu, que, como eu falei, está indo muito bem nesse primeiro semestre. A gente pretende replicar esse formato para frente. E o outro foi o WhatsApp da Lu, e nós já conseguimos bater mais de 100 milhões de captação, com grandes destaques, por últimos dois meses. Então, está tendo um crescimento exponencial o WhatsApp da Lu. and we will also share some of their numbers here with you in our conference. It is obviously a medium and long-term initiative. Listing products without third-party partnerships is a short-term initiative, it can be an online growth, a profitability, but without a doubt, for the long term, our main focus is Lu and the experience of iCommerce, an innovative pioneer that we created here in Brazil via WhatsApp, which we will also take to the web in the second semester. And finally, in the second block, Here is the second block to accelerate our service platforms. We have three big companies here, Magalog, Magalocloud, and Magalu Pay, which is also growing a lot, and which is not a company but a service platform, Magalu Ads. All of them with very positive numbers in the second quarter and even better, with an exceptional perspective for the segment of the cycle. So this cycle is now With very well defined pillars and we believe that this second quarter has already shown that we are on the right track and that we have a lot of engines to create value for our sub-quartets. Let's start now with the highlights of the quarter specifically. I wanted to make three big highlights, then Beto will elaborate better. André Matricardi Fabrício Garcia André Cesar Trajano André Cesar Trajano Alperi Passado, the same trio from the previous year. Here we have highlights of our rationality. We had an increase in prices in products whose memory components, which are increasing all over the world, have an impact, such as telephony, such as games, PlayStation, for example, as well as all the items from the IT sector that impacted here. Magalu and Cabum, and we reviewed this, keeping our strategic discipline, even accepting here a drop in the specific share line, which weighs on the maintenance and our strategic and tactical consistency here regarding the maintenance of profitability. With this, we were able to present an EBITDA of R$ 709 million. André Cesar Trajano We've had frozen treatments since the beginning of the year. We also have a lot of control over all the accounts. We have our financial management initiatives here. We have a consultancy that is still supporting us. We still have a lot to collect from the expense management point of view. We have a very large space. The total operating expenses of Magalu in the year represent more than R$ 10 billion, so there is a lot of opportunity here in almost all the expenses accounts for us to continue working and all the directors of the company are very focused here on continuing to execute this agenda. So we didn't get to the end here. From the expense control point of view, there are still things to be done. Our Red Card fell basically with frame freezing, both in the controller and in the general companies of the group, including Fintech itself. So I think there is a highlight here of our control and of our rationality that is very good. We also didn't enter any big package of the World Cup, we didn't buy any, we didn't make any big sponsorship, we knew the Cup was going to be good. But we didn't overdo it here in our marketing investments. In the last World Cup, for example, we were the sponsor of the games and we entered into packages of tens of millions of reais, even hundreds of millions of reais, hundreds of millions of reais to sponsor the World Cup. This year we kept our feet on the ground here and we tried not to make great investments in that sense. And UAB Didá is also very... André Matricardi, Julio Cesar Trajano Inacio Rodrigues, André Matricardi, Julio Cesar Trajano André Matricardi, Julio Cesar Trajano and the new financier of the group, Opero CDC, who also started with the right hand. Let's give color to this in my presentation and then Greg is here to answer your questions. You can go on. So these were the highlights, physical stores, maintenance, gross margin growth, expense control and our financial operations. Giving more color to the physical store here, we grew by 9.7%, André Matricardi, Julio Cesar Trajano André Matricardi, Julio Cesar Trajano Linha Branca grew 15% in the quarter and Móveis grew 10%. I'm showing here that Magalu's performance in the physical store is solid, it is a performance that is well distributed between geographies and categories We have innovations in the physical store, such as the implementation of physical stores for our group formats, such as the Magaluque Gallery, which has been a resounding success. We had a fantastic first semester, a lot of visits, a lot of spontaneous media, a great flow of people, which is the most difficult thing today to have a flow of people in the physical store. With the model that we implemented from the Magalu Gallery, with the constant presence of influencers, with the YouTube theater, with a series of events there, in the past week there was the anniversary of Harry Potter in the store, we managed to break this cycle of loss of customers in physical stores and it is being a format there, I think it is also very interesting. And as I said, we opened a store in Seylandia and we must open new stores here in the second semester, maybe it can give more scope for this later here at Q&A as well. In compensation, it can be online, we kept our consistency, we sold 9.3 billion in the second quarter of this year. Although online we have been doing well in the TV category, we kept our discipline and our focus on growth with profitability, commercial discipline. We had an impact here, some categories had, as I said at the beginning of the course, Telefonia, Informática, Hardware and the category of Games. We can later detail a little better the price changes, Fabrício and even Julio from K1 can give some color here of what happened. We reviewed, I think that whenever you do a review in the first quarter, there is an accommodation of the consumer, because he was paying, for example, R$ 3,200 on an iPhone 16e, And now this phone is already going to R$4,000, so there is an accumulation at the beginning. The iPhone 16 is the first price of Apple products, then it gets used to it and we end up buying it first. But in this trimester that there is a repass, like the same thing for PlayStation, the same thing for practically all products in the IT category, this ends up suffering. This repass of memory costs is due to the global increase in acquisition, the data centers are buying memory as always, You saw what happened with the Korean stock market, the growth of the companies that produce in-memory, both Samsung and its competitor in Korea. These are companies that are having very high results and are passing this on to the other categories. We kept this discipline, so we grew in the physical store when we were having profitability, we opened up a little bit Thank you for watching! We believe that we will be able to do this in the second semester, especially in the fourth trimester, but already in some months here in the third trimester, it is bad here. I just wanted to explain the rationale, because I know that there will be many questions about it. The idea is to position our own channels in Magalu, to consolidate our product leadership in 1P. Magalu is one of the largest platforms in Brazil, but it is the main seller in Brazil in 1P. In addition to being a platform that has 1P and 3P, a direct sales channel, we are the largest operator of 1P in Brazil through our flags. We are leaders in electronics, we are leaders in sports products, mostly U.P. Epoca Cosmetics, one of the leaders in beauty in Brazil, and Kabum, obviously, in the category of games. So we are leaders in U.P. In these categories, we were only selling the products in 1P to the 50 million monthly active users of Magalu, which are people who always navigate. There are 500 million visits, but there are 50 million unique users who visit our platforms here. We know that the web audience is much larger than these 50 million users who visit Kabum, Magalu, direct channels. And so we decided to introduce these products in third-party platforms. We had already done this with Aliexpress in 2024, with great success. Aliexpress is a very good partnership and we continue to grow this partnership. What is the rationale for us here? We think that the audience of Brazilian e-commerce is polluted and will be more polluted with many platforms here disputing the audience of our customers. Why not list our products on other platforms other than Magalu? So we started these negotiations at the end of last year. In this second trimester, we announced an important partnership here with Amazon from Brazil. and we must announce others now over the next few months. What is rational in these negotiations? The first are all negotiations that, obviously, because Marcelo is from Brazil, Magalu wants to have special conditions and reciprocity. So it's a point, a premise for us, we're just going to list implantations of third parties, If the profitability in these platforms is potentially higher than the average of Magalu's online channels, it will obviously be lower than when the client comes in organically to our direct channel, but it has to be higher than when we, for example, bring a client through a platform like Google, like Meta, like Facebook, that is, a client that comes through paid media. So the profitability in these channels has to be higher than paid media, Because obviously this client is from the third platform in the long term, not in the short term, the sale is ours, so we have to have this rationale. So we take a long time to announce the partnerships because we want to reach that negotiation that guarantees us a positive margin of contribution. We want to resume the online growth, but we will only do this if it is with more contribution, if it is a positive business, because we are very little. And another thing we expect from these partnerships is a minimum of reciprocity for the services of the Magalu ecosystem. We have focused a lot on Magalog, both from the point of view of everything I sell on these platforms. The idea is that even because we have a global platform, I'm going to talk a little bit about Magalog, as it's going well this quarter. Magalog is one of the largest logistics operators in Brazil and is open to sell to third parties. We also put it as important for us to close this business, to list the products on third-party platforms, to bring volume of these platforms to Magalog, not only what we are selling there, but also the operation of their P or, for example, of other sellers as well. And then, with this, we expand the density of the logistics network in Magalu, generating a scale gain through Magalog. So, we have to have this, profitability higher than our average, and we also have to have some level of reciprocity, mainly now we have focused on our logistics operation, both light and heavy, and also with the potential of removing products from these platforms in the physical stores in Magalu. Thank you for watching! Fabrício Bittar Garcia The idea here is phased, today we are competing at Buybox as any seller. We will enter here in a model that they call FBA on site, which means that from October or even a little before that, we will have our products with a Prime seal, with the potential to win Buybox and earn more sales. I believe that this tri will already be full, it is a tri of an expressive sales volume that will help André Cesar Trajano Thank you for watching! I would like to highlight that selling on third-party platforms is a very short-term solution for us to regain a positive online growth territory, but in the medium term we believe a lot in one of the great innovations that we have launched in recent years, which was Lu's WhatsApp. We announced to the market last month that we have already reached 100 million MVs, obviously we are only in December, It started recently, in the last few months we have been ramping up this operation a lot. We have generated more than 18 million conversations, remembering that it is a channel in which you have the authentication of the post-sale checkout conversations within the WhatsApp channel. You don't need to go to the app to make the purchase. This sales channel, Agente eCommerce, won. A lion in canes now in the quarter as one of the most creative solutions here of e-commerce and the use of artificial intelligence in a digital channel in this quarter. We are still with a three times higher conversion than our application and we already have a good number here, 20% of the clients who bought, remembering that most of the clients who bought in the last months have already returned here, obviously this ramp has been growing, January, February more than January, March more than May, June and July were the great highlights here on WhatsApp. We think that this percentage of clients who come back to buy on WhatsApp will increase a lot, but this 20% André Matricardi. and Massa Iniciativa de Arcoma. This is a great highlight of our operation. Moving on to the services platforms, I would like to highlight here the EDS, we had a growth of CTR of production products, 51% versus 2025. CELERS ACTIVOS ANUNCIANDO CRECEU 13% e eu queria fazer um destaque especial aqui porque a gente é uma plataforma não só para CELERS e para a nossa audiência, nós temos as nossas lojas que são mais de 20 mil painéis de lojas, então a gente montou aqui uma plataforma de Retail Media que serve para outras marcas também. E acho que o grande destaque do EDS e do segundo tri foi o fato de que a Hyundai escolheu Magalu Media Platform, especially Magalu for the launch of the i20, which is Hyundai's big bet here in the Brazilian market, the third car produced here in Brazil on the Piracicaba platform, to launch its product. and it was launched with Alu. Alu took the driver's license and launched this product. Our efforts to promote this new car were not limited only to its presence in communication. We used all our social channels, we are using our stores here. and the Hyundai i20 is the third most sold car in Brazil. There are several dealers that do not have this product. So, showing here the possibility of us monetizing our audience and the good work of our team. André Cesar Trajano, Julio Cesar For Magalu Pay, as I said, one of the big stocks born for the business. I'll talk quickly about the numbers here, but I think we can elaborate this better in Q&A. Luiza Credit, another very good quarter, with 15B of TPV, a 20B portfolio, 135 million profit in the quarter, growth of 32% over the same quarter of last year. More than 23%. Our IEF, starting here and with the growth of the portfolio, we already have 100% of the production of the company's CDC in our finance. We still have a portfolio in Varejo that is reducing, Jorge can explain this better, but our IEF has already started with 17 million in liquid profit. We launched the first CDB here in the quarter for our IEF. Our IEF, remembering it, operates our CDC. André Matricardi And we have more than 11,000 clients with insurance assets contracts this quarter. And a big highlight, we talked a little about it, but we have one of the largest consortium operators in Brazil. It sold 2,000 in credit cards in the second trimester, 30% growth over the second trimester of last year. We have more than 11,000 assets under the total credit card collection. E temos aí um lucro líquido de 15 milhões no nosso consórcio. Então assim, no geral, os nossos negócios financeiros estão indo bem e ainda com uma perspectiva muito positiva, principalmente aí com o ramp-up da nossa financeira. Eu acho que depois a gente queria poder detalhar isso melhor no Q&A. Pode passar? I would also like to highlight Magalog, which has a growth of 15% of orders delivered to the 3rd and 2nd TRI, without considering this volume that we closed with Amazon, which should enter here from the 3rd TRI. We have new customers such as TPL Logística, Balastrini, Nestlé, Samsung itself. and we closed the contract with her. So, very positive numbers here. We have increased the number of bases that are, in addition to having the stores that use them, they are based in retirada and our big CDs too. We now have 200 units in operation. We have opened 27 new bases here for the logistics area and we are working very efficiently with the use of technology, but nothing is as good as increasing the volume. So Magaluog is in a very positive context, with a lot of opportunities. There are very few carriers that have its level of service above 95% with its cost and the fact that it obviously shares these volumes with Magaluog ends up helping us to have a competitive offer for the market as well. We are excited here with this possibility. André Matricardi We have closed the acquisition here, the approval of the acquisition of R$ 300 million together with BNDES for MagroCloud. This number will not be debited, not at once, but R$ 100 million here from this quarter. We must grow these debits here over the next quarter and it will be, these are numbers invested here mainly in research and development which is the focus here of this capture by our team that has made very cool products, such as, for example, we have our first AI product in Magalu Cloud, so we can now make it available to our clients in Magalu Cloud as an inference, not a training, but an inference, both for GPUs that are from our own infrastructure, as well as for models that are outside of Magalu Cloud, We expanded three availability zones in the Southeast. and we are also expanding our data centers. We are obtaining more and more certifications such as 27001, NIST, SOC2, there are several certifications here, either already completely approved or in the activation process. This is important for us, especially for the sale of Cloud. For public services, which is one of its major targets, given the issue of national data sovereignty, increasingly critical. I think this is the main point, a great opportunity for Magalu Claudi to be in this growing issue in countries around the world in relation to data sovereignty. And these certifications are fundamental for us to be able to provide this service and participate in the government bids. and other private regulated sectors that I think are super important. So we are here in a good moment for Margalo Cláudio and we can detail this better than I did. Now I'll pass it to Beto for the financial highlights.

Thank you Fred, good morning everyone and thank you also for participating in our code of results for the second quarter of 2023. I will quickly go through the main numbers again. We achieved a gross revenue of more than R$ 11 billion this quarter, a 2% reduction.

Thank you very much.

Well, going back here, the big highlight again was the growth of the physical stores. The gross margin, one of the largest gross margins for the second quarter, in the 30.6% range. Our EBITDA with an 8% margin. O resultado líquido foi um prejuízo de 50 milhões, ainda muito influenciado nesse trimestre pela taxa de juros muito alta e pelo impacto nas nossas despesas financeiras. A gente vai falar mais sobre isso. E terminamos com uma posição de caixa total bastante robusta, quase 6 bilhões de caixa total e quase 1 bilhão de caixa líquido. In the next slide, we show the consistency of our EBIT margin over the last few semesters. For more than two years, we have been maintaining this EBIT margin very close to this 8% level. We talked a lot about the highlight of the gross margin, gross market margin, with the participation of stores and also with the help of the revenue André Cesar Trajano A gente conseguiu reduzir despesas com vendas entre 3% e 4% em relação ao ano passado, considerando a inflação do Brasil entre 4% e 5%. E também conseguimos manter as despesas administrativas basicamente estáveis em relação ao ano passado, apesar da inflação. So we managed to control a lot of our operating expenses and the results of LuizaCAD and Magalupe were very strong again. In the next slide, we show the composition of our EBITDA margin and comparing with last year, the gross margin improved The SDNA also improved to 0.10, the participation of the patrimonial equivalence improved to 0.20, so all these positive factors compensated an increase in the provisions that we made in the order of 0.4 percentage points. I'm going to explain a little more about this variation of the provisions. It had already happened in the first quarter and, again, it is closely associated with the growth of the CDC portfolio. The CDC portfolio grew from June last year Julio Cesar Trajano And also, all the reflection of this growth of the portfolio brought a lot more interest, which compensated this increase in provisions. Most of these interest are still in retail, with accounts here in this gross margin of commodities, but precisely with the transition to finance, This will all become clearer in the next few months. The financial criteria has already grown a lot, and the interest rates tend to migrate in the next 12, 18 months totally to our finances. This will become clearer for all of us, and in addition to all the financial benefits from a tax point of view, the funding cost as well, and transparency. In the next slide, we show a little bit about turnover and here is an observation. When we look, we call it adjusted because they are passive operations, less active operations, so the bigger the better. When we compare with last year, we are better, evolving from 1.9 billion to 2.3 billion. This quarter, specifically, our turnover went practically sideways. But with a very important qualitative improvement here that I will explain a little more. In this quarter, one of the great highlights here from the point of view of Capitão de Giro was that we were able to reduce the stocks by almost 600 million reais, I think it was one of the biggest reductions for a quarter, and we were also able to reduce the amount of accounts to be received André Fatala, Graciela Kumruian So, on the asset side, we improved stocks, which is very important, and the VAT reduction will continue to happen in the next few quarters as well. And on the passive side, this reduction on the side of supplier sales, it happened because, as we talked about in the last quarter, we bought a lot in the first quarter to prepare for the World Cup, and also to avoid the lack of products related to the global shortage of memory chips. So we made a bet that worked, we increased the stocks and in the second quarter we sold everything and reduced the stocks again. And then with that we had a volume of payments in this second quarter a little bigger than usual. André Matricardi, Julio Cesar Trajano What we observe is that it was basically stable in relation to the first quarter, the interest rates started to fall, they could have been much lower, but we had a little of this effect of the payment André Cesar Trajano A taxa de juros que está caindo, a gente tem uma perspectiva também melhor ainda para as despesas financeiras na segunda metade do ano. When we look at the next slide of our variation in total cash, we see that the cash flow of the operations was around 300 million reais, and here again, it could have been much higher if it wasn't for the concentration of payment of suppliers in this quarter, but even so it was enough to cover our investments and our rental account. A variação do caixa aqui está bastante associada ao pagamento de juros e de dividendos que a gente realizou nesse segundo trimestre. A gente pagou juros que estavam provisionados também em trimestres anteriores, então nossa dívida total ela praticamente caiu de 5,1 bilhões em março para 4,9 bilhões em junho e refletiu um pouco isso na variação do caixa também. In the next slide we show our total liquidity in R$ 5.8 billion, with R$ 1.8 billion of cash applied and R$ 4 billion of receivables available, minus R$ 4.9 billion of gross debt. We ended up with a liquid cash of R$ 800 million. We also reported the position of CDC and CDB in the financial sector. We opened two new points in the balance sheet to give more transparency For all of you, when we include here also within the capital structure, the credit card and the CDBs, our liquid cash goes up to 1 billion, we ended up with practically 450 million of liquid cash and more or less 250 million of CDBs, so we have a difference here of around 200 million, which increases our liquid cash plus credit card. And finally, here is our debt winning schedule. We have the end of the 10th edition of debentures in the fourth quarter, so we should end the year with practically 4 billion, and we started the year with 5 billion, so there is a tendency for a reduction of our gross debt to the order of 1 billion this year. In the next slide, we'll talk a little more about LuizaCred. Carteira de 20 bilhões, crescendo 2%, base de clientes de 5,7 bilhões, com um ROI de 23,5% Luiza Credit também está super capitalizada de novo, teve um outro trimestre com um índice de Basileia de quase 15% Eu mencionei que a partir desse índice de Basileia ela tende a pagar dividendos e devolver todo esse lucro para os funcionistas A inadimplência caiu bastante ano contra ano, tanto a de curto prazo quanto a de longo prazo, e ela teve um trimestre aqui muito forte, com lucro de 135 milhões, crescendo mais de 30%, mesmo com o aumento da alíquota de imposto de contribuição social, na verdade, sobre as financeiras. In the next slide, to finish, some highlights of MagaluPay. So, the credit rate is growing a lot. Since May, we turned the key and started to originate 100% of our CBC in stores within the financial sector. And the portfolio has already reached, practically, considering the interest rates to compare with retail, we have increased 600 million, more than 600 million, so the total portfolio is 2 billion. André Matricardi, We already have more than 250 million in a few months. We have capitalized the financial sector since the beginning in 200 million, so we have a Basel index of more than 50%. E divulgamos o resultado desse trimestre com 17 milhões de lucro líquido. Esses números vão crescer bastante, mas nesse trimestre, anualizando esse trimestre, a gente já teria um ROI de mais de 30% na financeira. Esses eram os principais destaques financeiros, agora eu volto pro Fred.

We are here at your disposal. Thank you.

We will now start the Q&A session.

To ask questions, click on the Q&A icon at the bottom of your screen. Write down your name, company, and the language of the question to enter the queue. Once you have asked, a request to activate your microphone will appear on the screen, so you must activate your microphone to continue with the question.

Our first question comes from Luiz Bonais from BTG. Luiz, please, you can go ahead.

Good morning, Vanessa, Beto, Fred. I think there are two questions here on our side. The first, Fred, if you could go back to your comment about the partnerships within the 3P platforms. How can we think about the IONT Economics of these partnerships compared to the C1P? I understand that here there are a number of opportunities with services, mainly as you mentioned in the Magalog, but if you could open up a little more for us to understand the potential of this IONT Economics. And then a second question, entering a lot of the topic of increased monetization of traffic that you have been commenting on, Frederico, if you could also give a little more detail about the evolution of the advertising platform and how we could expect the evolution of the Eonet Economics and also the ads within the Luiza magazine.

Good morning, Luiza, thank you very much for the question. Regarding the first question, I think the rationale is very similar to what I said in the presentation, Luis. Sales on third-party platforms have to give a margin of contribution above when I sell to the customer who comes from a media channel. For example, the customer who clicks on Google and comes to buy at Magalu, who clicks on Instagram and comes to buy at Magalu. My B2C direct sales have two large groups, customers who come in organically and buy here, and customers who come through a media channel. I consider these platforms equivalent to media channels. My premise, the premise that we closed with the company's board of directors, that Fabrício has executed and the other companies in the group as well, is that it has to be superior to the media channel. Why does it have to be superior to the media channel? Because this client is not necessarily a recurring client, because the registered file is in the partner.

When the client comes through Google and buys at Magalu, the registered file is mine, we can do it, there is an old lifetime of the client.

So, as a premise for us, it has to be superior to the media channel. Obviously, it is inferior to when the customer comes and buys directly. So, this is our rationale so that these partnerships have a healthy sale, so that we can operate on them in the long term. So, the negotiations here, when we pay the take rate, They consider these issues and, in addition to that, there has to be some level of reciprocity with the group's services, like, for example, Amagalogue. Another possibility of reciprocity is to list the categories here. We got this with Aliexpress and there is no possibility of one of these days of the new platforms also having reciprocity in the catalog.

The second question is about advertising, Fred, if you could explore a little more the size of the opportunity for you.

I think that here the fact is that there is an audience of 50, 500 million visits a month and also of visits to stores. So, for example, for us, for us to expand the physical store now with a still high CD, without a doubt, the part of RetailMedia, the Magalu Gallery, it was basically liable to RetailMedia. We had contracts because we have a store designed to be a brand place. So we practically closed the whole year with advertising. Team Jets worked a lot to sell spaces there, both physical spaces and packages that take advantage of a store that is full of LED and has many exceptional moments. So both physically and online, for us here, it is important Thank you very much for this participation. As I told you, we had 13% growth in active cells, we are promoting it, specifically on 3P, which is where we have In the effort to improve profitability, where it is a little more challenging, we have doubled the presence of EDS year-on-year and it has helped us to improve our... the margin of contribution of 3P. So, especially for 3P, it is super relevant and for the store too. So, I think that here is where we are seeing the biggest opportunities. And as I said too, sometimes there are these opportunities that we call non-endemic, These are brands that are not necessarily within the platform like this Hyundai, which is an additional value here contributing to our results.

Excellent, thank you very much for the answers. Thank you for the questions.

The next question comes from Irma from Goldman Sachs. Irma, please go ahead.

Good morning, I hope you can hear me. I wanted to ask you about this partnership with Amazon. Could you tell us a little bit about what surprised you at the first moment about the client profile? The type of product, the journey, perhaps the journey of this customer on the platform and perhaps also operationally about this integration. And the second question, if I can take advantage of the consumer environment, we have seen some companies and even some data indicating a potential deceleration in the second semester. So I wanted to hear a little bit about how your expectations are at the end, even more so after, obviously, a peak of demand in some categories because of the World Cup, but now with things normalizing, how do you see this second half of the year? Thank you.

Good morning, good morning Irma, Fabrício is speaking, thank you for the question. I will answer about the Amazon theme and about the second semester as well. On Amazon, the sale has surprised us at the beginning, it is worth remembering that we entered on Amazon, we are not yet with the Prime seal, as Fred said, we will be starting in October, so we are offering a medium delivery period, which is not even the best period, and the sale has surprised us positively. I think the great highlight of the categories is the white line, As we expected, the heavy items that we operate very well, practically better than everyone in the market, have been a great highlight. But other categories also performed well, TVs, furniture, anyway, we are quite satisfied with the partnership and we believe that when FB17 enters with the Prime seal, our company will improve even more. So the perspective is quite good for September, especially the last quarter. Sobre o segundo semestre, a gente tem um tema muito importante pra nós, a gente tá bastante confiante. Primeiro que vai entrar nas plataformas parceiras, a gente deve voltar a crescer online como o Fred falou, e a gente tem um evento importante que é o Super Unique que vai ter esse ano. The heat makes a lot of difference for us, because not only the air conditioning and ventilation line sells a lot and moves a lot, as well as the refrigeration category, which is the category that sells the most in the company. So, in the heat it sells a lot. We are very well programmed, very well planned with the suppliers, we are already starting to receive the items and they should help us a lot in the second semester. So, we are imagining a good second semester, yes. I think that's it.

Thank you for the questions, Irma. The next question comes from Lucas Esteves, from Santander. Lucas, please, go ahead.

Fred, Beto, Vanessa, the whole team. I have two questions. The first one is about agent e-commerce. I think you talked a lot about this theme in the letter. I would like to know your opinion. How do you see the future of agent e-commerce with a model based on proprietary platforms such as HALU? Or do you believe that the major national models will be the main channels of customer acquisition? And in this scenario, how does Magalu intend to preserve a direct relationship with the consumer and continue capturing value within this ecosystem? And a second question, a little more related to profitability. In the last two years, you clearly prioritized profitability, understanding and growth, right? At what point do you believe that the company will be comfortable to accelerate digital again without giving up the margin discipline? And if in your heads there is a specific trigger for a change of posture in relation to this? Thank you.

Hi Lucas, good morning Fatala, thank you for the question, talking about e-commerce. Well, the view we have is that yes, the big platforms are building the part of experience on top of the customer's shopping experience, we saw We also saw the UCT model with Google. and some fronts of Grands Valides building their own experience. We believe that the asset we have with ALU, which was created over the years, is a differential and part of the construction of an experience that is looked at in detail. Many of these great models are doing a more generic part, they end up not having the work done in detail of the experience that ends up damaging the conversion part. And we, from the beginning of the work we are doing with Alu, is being a great guide. How do we understand the part of the experience of the consumer journey to increase the part of the conversion? That's what we've been looking for and what Fred ended up showing from the numbers we already have, which are very good compared to what we are seeing from the market. and there is still a lot to be evolved in this process. In our case, what we want with Lu now is a work that she is able to have a complete understanding of consumer preferences, to store the memory of everything she does with We have the experiences not only with Lu, but we also have the sales channels, and from that we reach a level of customization that is really very directed to that person. Understanding of the preferred brands, category types, what he is going through at the moment of purchase, and being able to, with that, Good morning, thank you for the question. Regarding the second part of the question, which is regarding online growth, as I said, we believe a lot

Here, mainly in the fourth TRI, but already after a few months here in the third TRI, we will reap the fruits of these lists of third-party platforms. We announced Amazon here, we have, as I said, to announce at least one more here in the very short term. We are very quick to implement our catalog in these platforms, we have capitalized logistics in Brazil, stocks in Brazil. So we believe that in the short term, a way to be able to reverse Thank you very much. When you enter, as Fabrício said at the beginning, you enter with an intermediary solution, but you are learning to sell on the platforms, or increasing the possibility of winning buy boxes on these platforms with things like FB on site, or like others that will We believe that we will be able to do this reversal. The possibility of sales and volume on the platforms is very high because we are a series with national capital. We have excellent price negotiation conditions and our level of service is so good that we will automatically win the buy boxes. We feel here that we have a great chance to make this reversal in the second half of the semester, especially in the last few months of the year.

Tenente Fred Fatala, obrigado e bom dia para vocês.

Thank you for the questions, Lucas. The next question comes from Giovanna from UBS. Giovanna, please go ahead.

Good morning, everyone. Thank you for answering our questions. First, how has the sales performance been after the World Cup? And how do you imagine the evolution of Sandstorm sales from now on? And secondly, you mentioned the impact of the prices of memory chips. So I wanted to understand what your expectations are for this scenario from now on and how you see the margins evolving in the next three years.

Good morning Giovanna, Fabrício speaking. Well, sales after the World Cup, the TV category naturally has a drawback, but our store sales continued to grow, this trend should grow a high digit and it should be the trend until the end of the year to continue growing in physical stores, which is also very beneficial We are very confident about this. Regarding the chips, we already had part of the repass. Next semester, we are analyzing and seeing that in the cell phone category we should have a small repass. Thank you for the answers.

Thank you, Giovanna. Our next question comes from Pedro from XP. Pedro, please, go ahead. Good morning, Fred, Beto, Giovanna, thank you for the space.

I maybe want to explain a little bit about Magalupe. I think you have already evolved a lot in Magalupe, it was a positive result in the quarter, as you mentioned, it is not yet at full power, given that it is still The CDC in the new financial year is still quite recent. I want to understand a little better, maybe, where this can get. And then, maybe linking to the issue of profitability, everything is heading for a good fourth quarter, with the partnerships with the platforms doing well. You have Black Friday, Magalupe climbing. Do you think you can already resume a profit level, maybe in the fourth quarter, in 2027? These are the points I wanted to explore, please.

Thank you for the question. Jorg here for Magalupe. I'll start by talking about Magalupe in general and more specifically about the financial side. As Fred mentioned in his presentation, we have four André Matricardi, André Matricardi, A gente tem um desafio de crescimento e a gente está implementando melhorias de plataforma, tem uma mudança importante de plataforma agora já no segundo semestre, indo para microserviços, que vai melhorar sem dúvida a exposição dos produtos e a manutenção de clientes e também a gente está focando em evoluir uma melhor proposta de valor do cartão, alavancando a sinergia com o ecossistema. A gente tem a IT, que é onde está toda a nossa conta digital, All the processing and insurance part, this is also very good, a great engine of results in this vertical part is insurance, which is doing very well, especially in digital penetration, growing more than 20% year-on-year, and the part of stores that is also very solid. We are growing with platform improvements and a very strong focus on residential and high-end. We hope that this performance will continue with sales records. And finally, the financial side, which I think is the big point of your question. We have so many financial benefits with the new structure. I think we have already, in the last few semesters, explored a lot the tax efficiency that we can capture with the exchange Rodrigues, André Matricardi, André Cesar Trajano We will see more at the end of this year and beginning of next year. It is a great focus on the quality of the portfolio, as well as the intelligence of credit and payment. We are implementing a new credit engine, we have a new team that is developing and will already implement, from August, the initial tests of the new models based on machine learning and operating with all the data from our ecosystem. and the new payment system that we believe will also bring a lot of synergy to the operation over the next year. Thinking about all this and looking at what we had of financial results in retail, you operated with an ROE of 20%, an ROE of 2%. I don't want to get too much into ROE because, as we will operate with capital comforts, This here can impact the metric, but the R-Way, we believe that, without a doubt, we can lose a lot of value. This 2% can be something higher than 3%, for example. I don't want to give too much of a number here, but obviously this will only happen when we have stabilized cooperation. A gente tem algumas implementações regulatórias ao longo desse próximo semestre e acho que a partir de 2027 vocês vão conseguir capturar já grande parte desse potencial.

Pedro, good morning too. Thank you for your question. I'm going to talk a little bit about this topic. Unfortunately, we don't give guides, so it can't be that specific. But I just wanted to take the opportunity to reinforce. We made a profit in the last two years. We talked a lot about everything we're doing to resume sales growth. We have managed to control them as you have seen. Thank you very much. With more sales, we can also turn stocks better. We believe that to meet all these new platforms, we can sell much more than the stock we have today. So, we will also have a division here in the stocks, we will improve the stock price with the increase in sales, and this increases the cash generation, which consequently also helps in the reduction of interest rates that I mentioned, which we also believe, combined with interest rates, Juros futuros já estão menores, vale lembrar que nesse trimestre que passou os juros futuros subiram muito por causa de guerra no Irã, do preço do petróleo e tudo mais, mas também afetaram um pouco essa despesa financeira In this second quarter, future interest rates are now pointing down and I think the trend is that we start to benefit from the line of receivable anticipations with a lower future interest rate curve. So, we have, Luiza Cred, the influence is still very low, a very healthy and sustainable profit, everything Greg talked about our finance. So, I think we have all the ingredients on the table, we are doing everything to reinforce this trend of profitability that you mentioned. Thank you, Pedro.

Perfeito, obrigado, Beto.

You're right.

Obrigada pelas perguntas, Caravina. A nossa próxima pergunta vem do Andrew, do Morgan Stanley. A pergunta será feita em inglês, mas a resposta será em português. Andrew, por favor, pode seguir.

Thanks for the question. I'd like to understand just maybe an update on the strategy for your own marketplace. I know a lot of focus of how Magalu is selling elsewhere, but what does this mean for your own 3P strategy? And then just a related question, as we think about fulfillment, I'm curious the characteristics of your fulfillment sellers versus non-fulfillment, do you see them in any specific kind Seller sizes, categories, how they concentrate sales with Magalu or elsewhere. These updates on your marketplace would be helpful. Thank you.

When I said at the beginning of an important part of our curatorship, we will focus on those categories where we believe we have a competitive differential, some level of right-to-win within the categories. We have here in Drobo Goods a very large focus and excellent performance in 3P. We will continue to explore and grow series of these categories. Same thing for sports products, because of Netshoes, beauty, because of Epoca, gaming products, because of Kabum. So in these categories we want to get out of that concept of one-stop-shop, For a concept in which we are really a brand place, a company that sells products with added value, high perceived value. And we did a review of the categories that we believe we have the potential and it is in them that we will focus our investments, both from the point of view of hunting and from the point of view of investing in marketing for the direct channel. This is just a preamble, I'm going to pass it to Garrido to elaborate better on this answer. Sure, thank you Fred and good morning Andrew.

As Fred said, at the same time that we are prioritizing profitability and avoiding entering into a margin distribution, we have worked on two fronts. One of them is precisely this point that Fred talked about, the choice of categories, so we have Rodrigues, André Matricardi Not only home appliances, but also household appliances and household utilities have a very strong contribution and a moment of recurrence of customers. So, basically, what we have done in terms of category strategies is to start directing resources and categories investments where we have less margin, less recurrence, less vocation, to the categories where we have more, so that we maintain a margin and can invest in them. Now, a second front that is also important We have been working to improve the foundations so that the platform can scale in an organic way. Because the answer for a return of growth has to come from a lot of sellers, logistics and ads that we have already mentioned here, no more price subsidies. So we have already observed some positive signs of scale on the platform. In June we are with 13% more of ads with visits than we had last year, while we had a decrease last year. We went back to that number of sellers, so we have today 2% more sellers with sales than we had last year and with the highest historical level of sellers with sales over the total number of active sellers with published orders. The main driver of this has been, in fact, the continuous growth of logistics programs, full in front of them, full with 29% of the requests that we received, which is 2% more than last year, pulled by two things, an increase in the stock of sellers, we are with 26% more stock of sellers André Matricardi, André Matricardi We have controlled it around 30%, it will continue to grow, but not much, and we have invested in other programs as well. For example, we reduced the number of 3P deliveries, which were made by mail, from 10% to 2%. We have invested a lot in ultra-fast delivery programs, on the same day, which we call de facto, from the quota of delivery men close to the store, 10 km away. We have delivery on the same day, paid by the customer and therefore with a very low margin. Great, that's very helpful. Thank you both.

Thank you for the questions Andrew. Our next question comes from Wellington from Bank of America. Wellington, please, you can go.

Thank you very much Vanessa, Bom dia, Bom dia Beto, Fred and team. I think I have two questions here on my side. The first one I think you have been talking a lot about how you are achieving I have a question related to... I would like to understand if you understand that maybe it's a bit of an anticipation Thank you very much for listening today.

Good morning, thank you very much for the question. Yes, we have a very extensive work here, mapping the opportunity of spending reduction, and I think a good part of it has not yet been implemented. So I think we still have a lot to do. In the second semester, this work is encompassing both the organizational structure and practically all the accounts of the company, since the beginning. We have several opportunities here to be captured here in the second semester. We are very confident that we will continue Meliorando aqui, mesmo o marketing também ainda tem oportunidade. Continuando, entregando bons números aqui em relação à direção de... Sempre é uma batalha em glória porque você tem a indexação, então você tem a inflação que sempre acaba pegando, a inflação tá mais comportada também, né? And this inflation will help, as Filiberto said, in the reduction of interest rates. I think that the market is a little more positive in terms of the reduction of interest rates in the financial markets, but it also helps in the decedents, in the repayments of rents. As it has been in the last two months, it is positive here. And if we can get a smaller indexation of the economy and capture all that we are planning for our project, I can't give too many details because they are very sensitive, projects full of expenses, but we are confident that we will continue delivering on this front, as we have seen in the last three months. But the bulk of the project has not been captured yet.

Sobre a venda do segundo semestre, como eu citei antes aqui, a gente, a categoria de TV deve ter sempre uma ressaca pós-copa, principalmente agora em agosto e setembro, depois do último tri, ela deve ter a sua venda normalizada, isso é natural, todo ano de Copa acontece isso, mas como eu falei, a gente tem alguns fatores que vai nos ajudar no segundo semestre, um é o calor, Thank you very much. Thank you for the questions, Wellington. Our next question comes from Guilherme from HSBC. Guilherme, please.

Hello everyone, good morning, thank you for the space. You answered my question here, partially, but I wanted to understand here how was the evolution of sales month by month, in the second quarter, and how did you see, specifically, July? Thank you very much. Thank you. Thank you very much.

Well, about July, thank you for the question, Guilherme, Fabrício speaking. About July, in July we were not so benefited by the World Cup, Brazil was eliminated before, we had a plan that we would reach at least the quarterfinals, we lost a week of sales, more or less, good TV, we had in the physical store, even with this sale, Julio Cesar Trajano Julio e Agosto, depois do último TRI, a gente deve rampar, então o cenário de venda é esse, a Copa foi muito boa até Junho, Julho foi só uma semana de vendas, mas a dinâmica de venda do TRI está muito ancorada no que eu citei anteriormente, e o cara agora deve começar a esquentar dia 20 de Agosto, Paulo, Betts is natural that when there is the World Cup, the volume of bets increases, but let's remember that Betts in Brazil, 70% is not related to sport, it is related to shooting, it is more casino-line.

I have talked a lot, I am vice-president of the IDV as well, besides Silvio Magalhães. The IDV has been very vocal, all Brazilian lawyers have been very vocal in relation to the fact that vice-in-debt kills, besides being an economic problem, because last year we are talking about almost 300 billion reais, who were moved by the bets. And although part of it goes back to the bettor, we now have recent data that the volume of losses was tens of billions of reais to the bettors, but even that which does not go back to the bettor, which goes back to the bettor, is tied up in the bet. You have a series of gamification there for them not to take the money from there, and this money is coming out of consumption. So, it's a serious problem and it's being exposed with very few attitudes to control it. It's not just an economic problem, it's a public health problem. I think we're being very omissive in relation André Cesar Trajano, Julio Cesar André Matricardi Thank you for the questions, Guilherme. Our next question comes from Antônio, from Jeffreys. Antônio, please.

Good morning, everyone, how are you? Thank you for the opportunity to ask questions. I would like to explore two points. The first, I think explored a little by colleagues before, but I want a little more depth, perhaps, in your ability to André Matricardi, Fabrício Bittar Garcia, Frederico Trajano If the revenue is flat, you have managed to keep margins. So, how difficult would these two scenarios be to keep the margin at this level? How much would it make it possible? Maybe it would generate an operational mismatch. The second point I wanted to understand, I think that every time the company If the value of the company is less in retail itself, but everything that retail allows, all the other aspects that you have linked to retail. How much do you intend, maybe in the medium term, to open more proactively, even numbers, about other segments, about Magalog, about the different initiatives of MagaluPay, because that way we can understand Thank you very much.

Good morning, thank you very much for the question. Regarding the expenses, I just answered, but I would like to reinforce the following. If there is an account that does not depend on the macro, it is the expense. I think it is totally in our hands, it is our decision. I think it's one of the few accounts in the balance sheet that only depends on us, on our ability to be efficient. There is a strong and important agenda that we didn't mention, But there is an application of AI in processes, we made an AI manifesto here in the company and I think that all the company leaders are encouraged and stimulated to use AI to improve processes, that is, increase the productivity of programmers. Sometimes it's not just optimizing and automating the process to make it better and more well done, so control in the call center. Thank you very much. Thank you. Thank you very much. Thank you very much. Why is so much money being invested in AI in the world? It is because there is a significant part of these investments that are to increase productivity, which is exactly what we are looking for here in Magalu. So we have hundreds of initiatives here made by our leaders to automate and improve spending, besides all the more traditional works here in the context of containment, This does not depend on the macro, it depends on our discipline and our resolution.

António, obrigado pela pergunta. Acho que é só falando um pouco mais sobre a nossa divulgação de resultados. A gente tenta achar um equilíbrio ideal entre dar muita informações e às vezes dificultar o entendimento e a leitura de todos os nossos investidores. And not to give away too little information that would also harm the more complete understanding of our ecosystem. So I think I appreciate your question, it is a topic that we are always analyzing, always trying to evolve. Nesse trimestre especificamente, a gente começou a dar mais cor da financeira Magalu Pay, que acho que é uma evolução. Até então, todos os juros da nossa carteira de CDC estavam misturados com a margem bruta de mercadorias. And just so you have an idea, a portfolio of R$ 2 billion, considering the rate of interest that we charge and the medium term, we have a revenue of R$ 1 billion that was within the margin of goods and is still subject to the tax of semesters, and so on. In this migration, we will have more transparency, more tax benefits, more solid results in the Magalupe financial system. Thank you for watching! Thank you for the question, Antônio. Thank you, guys.

Thank you, Antônio. Our next question comes from Nicolas, from JP Morgan. Nicolas, please, you can be here.

Thank you, Vanessa. Good morning, Beto, Red Retina. Thank you for the cup and for asking our question. I wanted to talk a little bit about turnover. As we have seen, it improves at the stock level. I think the cup now, I don't know, second or third, has helped a lot with that. I wanted to understand a little bit your perspective Thank you very much.

Thank you, Nicolas, for your question as well. I will comment a little about each of the capital accounts. In fact, in stocks, we reduced and presented, we reduced a lot this quarter, and we reached a level that was the lowest level of stocks, below 7 billion in the last 5 years. The trend now, naturally, is to go up a little, especially in the fourth quarter, because of the Black Friday sales. Maybe they go up a little already in September, but it's mainly in October and November that we have a peak in stocks. And then we naturally have to bring this level down and close the year with stocks that are quite healthy. and Giro de Estoques, which tends to be the best of the year and better than last year, mainly considering what I mentioned here, that we should resume growth without having to increase the stocks to meet all these platforms. And we are also very well supplied with stock and distribution quality. We are very well prepared for this sales acceleration. and improve the turnover of stocks. On the payment term side, we tend to keep it, I don't think there's much room here to increase even more, but keeping this term and improving turnover, we tend to improve this relationship between stocks and suppliers. I mentioned the negation of accounts to be received by the financial sector, so in retail and in the capital market here, we should see a significant improvement. In this June position, we still had 2,400 accounts to receive in retail, which tend to be amortized in the next 12, 18 months, so this will generate a lot of cash for retail. And this portfolio will grow in finance, financed again by CDBs, financial letters and by our Basileia, where we are aiming for our own capital here, of 20% and financing this portfolio 80%, mainly with CDBs and financial letters, so there tends to be a big leverage here We still have 1.4 billion to unhook in retail in the next few periods. I didn't talk about taxes, but we also have a great opportunity to accelerate the taxation of taxes. In this first semester, we kept the balance stable, compensating the monetary update of these balances, at least, and the tendency that in the second semester we have a reduction of the principal balance as well. So, in addition to compensating, transforming the monetary update, at least, into cash, We have a principal reduction, increasing the contribution of taxes to cash generation. Last week we already had a positive news, we already had over 100 million of judicial deposits that were released. So, just to remind you, we have 3 billion practically of SMEs and PIS and COFINS that we are monetizing organically. With the tax reform, we also hope that the cash flow will improve even more because it will be easier to compensate and there won't be this current dynamic of tax substitution that we end up paying taxes in advance. So we hope in the next few months and maybe one or two years to monetize this balance of taxes to be recovered in the order of 3 billion. and we also have a balance of 2 billion to be monetized, because most of them have already been transferred to the court, mainly the DeFal and the RATFAP theme. So we have many opportunities to generate cash, Thank you for your contribution to our cash generation. With all of this, we have more resources to continue reducing our debt. You also asked about debt, so we must reduce our debt by the end of the year. and also reduce with this cash generation the volume of receivables anticipations, it is very linked, receivables anticipations are very linked to the turnover capital, it happened in the second quarter and then again it should not happen in this way in the second quarter, so the tendency of receivables anticipations should be much lower in the second quarter by the cash generation itself And also, the cost must be much lower due to the lower average rate and the lower future interest rate. So, the trend is also that we try to reduce the financial expenditure a lot and the financial expenditure's weight on our results. And with the reduction of debt, the reduction of interest on debt and also the reduction of receivable anticipations and the cost of receivable anticipations, A gente tem uma tendência positiva nesse sentido de coisa.

Super claro, Beto. Obrigado. Obrigado.

Encerramos neste momento a sessão de perguntas e respostas.

Gostaria de passar a palavra para Frederico Trajano para as considerações finais. Por favor, Fred, pode prosseguir.

Well, I would like to thank everyone who participated in our call. I would like to reinforce that we are finishing another conscious quarter of our challenges, but very confident in what we are building. We will continue with discipline, with urgency, and above all, also confidence in retail, in Brazil and retail, and retail mainly in its best version, which we consider to be the multi-channel version. Thank you all very much, have a good Friday and a good weekend.

Thank you for your participation and have a good day.