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Hello, everyone. Thank you for standing by and welcome to RD Saúde's fourth quarter 2025 earnings conference call. This presentation can be found on RD Saud's Investor Relations website at ri.rdsaude.com.br, where the replay for this conference will also be made available later. All participants will be in a listen-only mode during the presentation. After the presentation, we will begin the question-and-answer session. Before proceeding, I'd like to mention that forward-looking statements are being made under the safe harbor of the Securities Litigation Reform Act of 1996. Forward-looking statements are based on the beliefs and assumptions of RD Saudis management and on information currently available to the company. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties, and assumptions, as they relate to future events and therefore depend on circumstances that may or may not occur. Our investors should understand that general economic conditions, industry conditions, and other operating factors could also affect the future results of our DSAO day, and could cause results to differ materially from those expressed in such forward-looking statements. Today, joining us from the RD Saúde Studio are Mr. Renato Raduan, CEO, and Mr. Flavio Correa, CIO and Corporate Affairs Chief Officer. Good morning. Turn it over now to Mr. Renato Raduan. Hello. Good morning, everybody. Thank you very much for joining us in the 4Q25 earnings call. We're here to take your questions, give an overview of the business, and do our best to clarify any questions you might have. Hello, Flavio. How's it going? I expect a lot of questions. I hope you had a good night's sleep, Flavio, because I believe we're going to have many questions to take at the end. But before that, we are going to go over our presentation and leave some time for Q&A. Usually in our earnings call, we talk about the highlights of the fourth quarter, but since we issued a material fact notice yesterday, you probably have many questions about 4Bio. And I don't want to delve too deep into the 4Q results, and all the while you will be thinking about the material fact. I'm going to give you an overview of why we had this deal with Profarma, and then we are going to go over the fourth quarter and take your questions. I believe you are well familiar with, for a bio, I think it is worth explaining why it is such a successful venture. It has a very differentiated proposition in the specialty retail business. It provides the customers a very different service to the customers, a last-mile service and also a customer service, a customer-centric service. I don't know which camera I'm talking to. That's why FurBio was so different from the competitors. Another differentiating factor was the human-centric value proposition that it has. And that is part of the reason why it grew so much over the last years, going from 125 million, that's the number we had the year before we acquired part of the company, and it reached 3.3 billion Brazilian reals. Now, let me explain to you why we thought it made sense to sell the company, and then I'm going to talk about the financials. What changed in recent years is that the market changed with the pandemic, with medical loss ratios getting higher, and operators, carriers became much more price-driven. due to financial needs. So all the value that we added to the business was no longer the interest of the carriers. They became much more price-oriented. And then... the market started to operate on a reverse auction basis with hospitals putting more pressure on prices. So the business characteristics changed, and the most relevant factors involving Floral Bio became less prevalent. And in a business that is much more price-oriented, there are owners that feel more natural for this business, that could add more value to it than we can. What we had with ForBio was a cultural fit and a true belief in delivering a different value proposition, but it no longer makes such a difference in this market. The tax designs should be more efficient, and we believe that a wholesale company like Profarma can add more value to a business like 4Bio. That is one side of the equation. We understood that 4Bio would be stronger competitively, with ProPharma and a company like ProPharma than a company like ours. And also, on RD's side, we realized this year very clearly that when we invest our energy and capital in what we do best, which is pharma retail, the results are great, as you're going to see in our 4Q results. When we invest our energy where we have most competencies, we have great results. So this is about focus for RD. That was the rationale behind our strategic decision to go forward with this deal. And financially, it also seemed to make sense. The deal, as we explained to you, was at an amount of $600 million with $8 million in cash. So nat, it is $520 million. And it is the price that Pro Farma is paying. And we believe that it makes sense. We believe that they are going to be able to increase the size of the business. Of course, if you look at our multiple of our net profit in the last 12 months, it would be a multiple of six. And we ended the year with 72 million, so the multiple is actually seven times. And Profarma is paying 520, but for us, It's going to be worth $700 million because we have rights to receive payments, for example, sales tax rate differentials. We are going to receive that money over time and also $60 million in income tax. So for us, the final balance will be $700 million, and we invested $400 million in this asset over time. With primary and secondary stake, we paid $400 million, and the IRR is close to 17%, with a multiple of almost 10 times. We believe that this business is worth more to someone else other than us, and we believe that this is a win-win deal. This is the overview of the strategic decision that we made to sell the business and also the economic rationale. I believe that I have now addressed part of your questions about the deal, but at the end, if necessary, we can take more questions about this. And now I would like to talk about the 4Q results. The numbers were very solid, extremely strong, and in normal conditions, we would be proud of these numbers for sure. But I believe that these numbers become even more important and greater if we consider the starting point that we had. The beginning of the year was very difficult. The end of last year was difficult as well. And to get to the fourth quarter with such numbers, starting with such a bad starting point, I believe this is reason for everybody to be proud. We had... 3,547 units in operation. We opened 330 new stores with an IRR of over 25%. So this is a very good expansion moment for us in terms of quantity and quality. And it is going to help us be stronger and stronger and more capable of consolidating the market in the future. We reached 52 million active customers, which is one-fourth of the Brazilian population. And we had 440 million tickets. It's like every Brazilian person bought twice in our stores. But it's actually 42 million people going to our stores on average eight times in the year. And the NPS was 91%. It is a record-breaking number for the company. I know that it's hard to go to 93, 95 from 91, right? And we should remember that this NPS is at a very high level. And in order for us to keep such a high level with so many tickets, it's absolutely fantastic. We also had another record-breaking number. in the period of 12 months. We had 170 bps of market share gain. We are changing the metric from the manufacturer price to the consumer price, but even considering the previous metric, we would have 180 bps in market share gain. We don't recall reporting such a high market share gain in any other earnings call, and that happens across the board, across all regions. And, of course, GLP-1 drugs have a major effect on this, and we take pride on it. We mentioned earlier in earlier calls that we were prepared to serve this wave. But even if we exclude GLP-1 drugs from this market share gain, the gain was 100 bps. So it is a record-breaking number. Our digital revenue came to $11.3 billion, I believe, last year. We grew by over 50% for the third quarter in a row, and our retail penetration was 29.3%. And we also had an NPS that broke all records on digital channels. And, of course, the performance is a natural consequence of our delivery, of our execution, and everything we provide to our customers. The consolidated numbers look like this. Gross revenue with $47.6 billion with a growth of 14% year-on-year. And in the fourth quarter, it was 19.8%. Our adjusted EBITDA was 3.4 billion, and our adjusted net income, 1.3 billion. And, of course, those numbers were the result of a great, extraordinary performance in the third quarter. And now let me show you the details about retail. Gross revenue in retail was $44 billion. We grew by 22.3% in retail in same-store sales and mature same-store sales, 14.5%, and 11.4 percentage points in relation to CMAT. And our EBITDA grew by 41.2% in 4Q25, reaching almost 1 billion EBITDA and a net income of 1.2 billion. So looking at the highlights, you can see that this was a very strong quarter. And isolatedly, it would already be very good, but if we consider the starting point and everything that we did over the year, this is a great achievement. We started the year growing by 10%, 12%, 12.7% in 3Q, and in 4Q, we grew by almost 20%. In retail, we grew by 22.3%, as I said earlier. and we were able to grow so much without letting go of our gross margin. Although there was a lot of pressure from GLP-1 drugs with a smaller margin, we were able to grow, keeping our competitiveness with prices, and we only had a loss of 20 bps in gross margin. We were able to dilute our SG&A, and especially DNA expenses, and that is part of the achievements that we enjoyed this year, and that took our beta margin to leap from 6.2 to 7.2 after 12 months, and the market share looks just the same with 1.7% growth. Before I turn it over to Flavio, I'd like to show you the quarter-on-quarter view as well. We had 10.8 and then 11.6, then 12.1, and now 13. You can see that we had a succession of quarters with growing numbers. And in our core business, in the retail business, although... we look at quarter-on-quarter numbers and not year-on-year numbers, you can see that the growth was significant. And the fourth quarter is also a reason of pride for us because we were able to perform very well in HPC. The Black Friday was extremely solid. Last year, we knew that we underperformed, as we told you very transparently. And this year, it was different. We had a growth of almost 18% in HPC. Of course, GLP-1 drugs have a major effect here. And even if you exclude that effect, the growth was a double-digit one. And the major challenge that we had with HPC is behind us. We closed the quarter with 18% growth. And if you look at these numbers, you can see why we take so much pride on them. Thank you, Raduan. Now, let me give you more color on some of those numbers. Considering the overall growth of the company of 19% and looking at the breakdown of the 22% growth in the retail business, we can see that the stores have been growing by 16%, which is a very strong result generated by the 330 stores that we opened in the period. And also, As important as that growth is the growth of sales in mature stores, standing at 14.5%, a record-breaking growth. We never had any quarter with such a huge growth, and that is 11 points more than the CMAT inflation rate. Of course, this is pushed by GLP-1 drugs and the digital channel as well, which is very strong, and HPC. and also the overall results that we had on Black Friday. Now let me give you more details on the digital channels. Digital reached $11.3 billion in sales. So we surpassed the $10 billion mark. And we had a specific growth this quarter of 78%, and that is boosted by GLP-1 drugs and Black Friday, as I mentioned earlier. So it's important for us to understand the quantity and the quality of these numbers as well. This result... 82% of our digital result came from the app, which is not an open channel. It is a channel used by engaged customers. So it bears witness to how engaged our customers are and how frequently they come to us. Those are all very positive indicators. Our performance was sizable, of course, but at a very high quality as well. And we believe that this is a business that cannot be replicated. Our digital strategy does not take place only on the digital world. The digital strategy materializes because of our stores. The stores are the main place where the customers engage with us. The drugstores, the pharmacies are where the customers fulfill their deliveries. And that synergy between the physical world and the digital world is where the strength lies here. We reached an NPS of 80, which is a very solid one, very different from the rest of the competition. And we have also a high number of deliveries happening in less than one hour.

Concerning market share, we have a new methodology as of this quarter. We've been using price to the consumer, not to the plant. But regardless, our factory price or customer price show a very significant growth observed in the year. 1.7 market share gain in the period throughout the country. This is a record-breaking number. We have never grown that much in recent years. With some important highlights. Three percentage points market share gain in Sao Paulo. Sao Paulo amounts to one-third of our sales. It means one-third of the sales of Sao Paulo for the whole state of Sao Paulo, which means a lot, having a three percentage point increase. Two percentage points growth in the Midwest. We've been progressing significantly there. And another important point of growth in the Northeast, where we've been expanding our scope of work. This is indication that we have solidly and robustly expanded all categories, which is Blue Ocean model with 10% increase of new stores on a yearly basis. And we close less than 1% of our stores per year. Very solid result in the qualitative data of our market share. Gross profit, year over year, it went from 27.7% to 27.2%, aligned with our strategy of categories. We started the year at a difficult level, but we closed the year at a very positive position. We have HPC here with a lot of commercial activity, more aggressive pricing strategy, We have also had an increased share of GLP-1, which is going up to two-digit, so low double-digit for GLP-1 sales, but diluting our gross margin. In addition to CMAT effect, we grew less than CMAT this year. And this year, there is a pressure of 10 bps, but in the quarter, The loss has led to a 10 BPS positive balance. All these pressures have been offset by 10 BPS and 4 BPS sales and others. In other words, we've lost 50 BPS of margin throughout the year, but they were all offset within the quarter and neutralized in the year thanks to improvement in selling expenses and G&A. Selling expenses. Even though there were a number of pressures leading to changes from 17.4% to 17.5%. In 2024, we had weak bases of people. Our headcount was not enough. And throughout the year of 2025, we've replaced most of our store's staff and also offered more benefits. This is a pressure that impacts selling. But in the last quarter, thanks to all our adjustments, we had a dilution over what we had last year, going to 17.6%. So structurally speaking, we are doing okay. And GNA, As a result of all the decisions we made in the first quarter, pictured in the second quarter, our structured GNA went from 3.1 in 2024 to 2.6% in 2025. This level is very solid, stable. We do not expect it to go up. This will be our steady state, so to speak. It means EBITDA margin of 7.1%. pointing below what we had the previous year, but offsetting all the pressure imposed on us in the first half of the year. The fourth quarter had a margin of 7.2%, one percentage point over what we observed in the fourth quarter last year, or 2024. EBITDA of retail, as we are going to work just in retail, EBITDA X4 bill was 7.5%. This is the number that we have to have as a reference from now on, X4 bill. Cash cycle was positive. There was an improvement in the number of days in the cash cycle, coming from a five-day inventory level drop year over year. Now let me go into details on the financial elements, and I believe more questions are going to be asked concerning that. Maybe something that was not clear in our release. Our financial expenses was 250 million BRL in the quarter. But financial expenses is structurally higher than in previous quarters because of one specific entry in financial revenues, which result from our supply of finance. Expenses which were not accounted for in the first quarters and were all concentrated here. It's about 17, 18 million Brazilian reals in the operation. the results should be increased by 18 million, and the three previous ones should be deducted of the same amount. As a consequence, in our net profit, which was 360, in recurring basis, the 360 would be 380. Set that explanation and making it clear now, Our financial expenses impact the results of the year, going from 1.3 to 1.7%, 40 BPS increase, but aligned with higher interest rate in 2025 and higher debt levels because of AVP and because of a comparison basis of previous year, which was somewhat disproportional. we have really observed that difference. Part of that pressure was offset and recovered in the interest rate because of the profit sharing compared to 2024. And also because of some subsidies that we improved. It means 2025, we had net margin of 2.8%. If we revisit 2024 with all that one-off gains that we have observed and have led to a reduced number here and less financial expenses, our recurring net margin would be 2.8%, maintaining the year of 2025 very much aligned with previous year results. considering, of course, all the pressure that we were submitted to in the first half of the year. Another important point that you always ask, what is the recurring interest rate for the year? 11.2 for the year, and we expect to have a recurring interest rate level of 8.6%. positive free cash flow, as you can see here, positive results, 197 million with a total flow of 175 negative for two specific situations. When we speed up the car, it means we consume more fuel. This is what happens in the last quarter. We needed more cash to perform our operations, but we are getting to a plateau, and this is going to get stable. And also because of dividend distribution, the end of the year, $113 million, to optimize the tax opportunities. Well, to wrap up and then finally go into questions, if you were with us in the RD day, beginning of December, you have seen this slide. We talk about our current position and where we are heading to. We said that we spent the whole year of 2025 on recovering our performance, a performance that really portrays the assets that we have built throughout time. the last quarter of 25, first quarter of 25, did not really show what our company currently is. So throughout 2025, we tried to recover our performance, value proposition, reinvestment in price and competitiveness, logistics, inventory levels. We invested a lot on our pharmacies, offering a greater value proposition to people. We really focus on AHPC, improving customers' experience, and I believe we've succeeded. That can be translated through the NPS. It has all been funded with expenses, with discipline. So we adjusted G&A. We focused on inventory levels and losses. So now they are at much more acceptable levels. And in addition to that, as I've emphasized, we've focused on obtaining G&A efficiency, but also optimization of investments and capital allocation. The culture of efficiency was not only for our recurring corporate infrastructure, but rather everything that we were doing in terms of investment of capital. And it has really improved significantly. The for-bio transaction is not in isolation. It's part of our reanalysis of capital allocation. For-bio sales is exactly part of that focus on the core that we've had throughout the year. I said that once we have achieved the level that we had envisioned, which is exactly our current position, we would go into a second level where the whole management and the executives could rather focus on something else. rather than focusing on recovery of performance. Now we are taking one first step and moving ahead, adding additional layers to create stronger modes. We have revisited our strategy. We have very much clarity on the most relevant segment of customers that need the pharmacist. We have paid attention, listened to their concerns, what would be important for them in terms of value proposition and how we can resort to our own assets to achieve that. So focusing on optimizing our culture of efficiency, evolving in the use of AI, allocating capital to where we have the right to win, where our competences lie, and we are going to keep on accelerating those different elements. And this is going to take us into a cycle of gains, which is disproportional, really. not only because we are reinforcing and establishing our boats, but because of market elements as well. GLPO-1 is going to be part of that. It is a growing, relevant segment for the future of pharma retail, and we have the right of having overshare here that has been built throughout the decades. It is going to really mean a lot to us. We have more investment power than our competitors. Our bid is 3.4, 1.3 billion is our profit range. AI technology will be essential for successful companies. We have an investment power in technology and AI, which is much higher than our competitors'. The more digital our customers go, the better, because we have a competitive advantage in terms of our digital solutions. And the experience of our app is very similar to the leaders in this area. So there are a number of market factors combined with all our strategy and focus in terms of proposition modes that will take to greater shares. Of course, this is an ongoing process. As we improve value proposition, we are going to gain more scale and share. The more share and scale, the better our performance and investment power, the more we can invest in people, in value proposition to customers, the more we invest, the more we accelerate gains of scale and share, and so on and so forth. This is the flywheel which is going to take us to even greater gains in share because this is all built up on our years of history. We have been also in our venture for 15 years, the merge of our 15-year merge, emphasizing all the elements of this strategy. Well, now we are ready to answer your questions related to ForBio, to the quarter, to the year, anything you need to know to understand better our business. Thank you all very much. Let's now open for the questions. We have here the good cop, bad cop strategy. We tend to get sometimes questions that go very, very deep. So please let's ask one question at a time, one question per participant. So please focus on your most important topics of interest. Thank you very much, Raduan and Flavio. Let's now open for the questions and answer. The first question is by Luis Guanaes with BTG Pac-12. Good morning, Raduan and Flavio. You see, Raduan, concerning what you've just talked about, GLP-1 opportunities, could you please tell us more about what we can expect in terms of working capital? First, with improvement of the supply of Monjaro, You knew how to deal with that quite well, but still it was an issue. And secondly, once you have generics, I believe that it has changed somewhat as of the second half. And Flavio, when you talked about the adjustment in your financial results with supply and finance, 18 million per quarter, right? So the adjustment of 18 million in the last quarter, but all the other quarters had similar adjustment. Did I get that right? Red one, now one string. First, I'm going to talk about GLP-1. Yes, it has favored us in working capital. If it's a product with short demand, of course, the inventory turnover is very, really high. Customers used to pay cash, and then we could pay installments to our suppliers. With time, things changed. Now we can sell also in installments, six installments. The terms of our suppliers haven't changed, but... as there is no more shortage of the product in the market where we can have higher inventory levels, when we consider the net of the working capital, it will receive some more pressure. But if you consider GLP-1, the working capital cycle will be better than the whole company if we have a good management of coverage and inventory policies. But still, It has been creating value to us, to our competitors, and more is coming, of course. It's a lot. It is a market of $10 billion, amounted to $10 billion last year. It will get to $50 billion in upcoming years. We will keep on having overshare. Maybe there is going to be some decrease with generic prices may come down, but the average price is 40 reals. If it goes from 1,600 to 400, it's still 10 times higher than the price of regular medication. So we are going to maintain the overshare, of course, and we're going to work towards that. The adjustment that you mentioned about the financial expenses, they should have been 9 million in the second and third quarter. As they were not accounted for in the second and third quarter, we entered 18 million in the last quarter. So 18 is the total number, but the 18 was a combination of two other quarters, second and third quarter, no carryover from the first quarter. Great. So 18 is the Year effect. Thank you for your answers. Yes, the annual effect is zero. Within the year was zero. It was just a... Those that should have been second and third quarter were not entered. So net profit was 9 million higher. The 402nd and third quarter should have been 390. So the 18 million were launched or entered, better saying, in the last quarter. So it should have been 380, and it was 362. It was subtracted. That was the fact. In the year, zero net effect. Perfect. Thank you very much. Thank you.