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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.

Thank you very much. The next question comes from Marisa Zapeta with Morgan Stanley. Hello, good morning, Raduan and Clavio. Thank you for taking my question. My question is about your strategy and your focus on simplifying the strategy. In previous calls, we talked about this for different reasons, but now with the sale of 4Bio, it seems to me that you are treading that path of focusing on simplifying the processes. Is it fair to say that you are going towards a pure retail strategy? For example, reducing the healthcare services at the stores and simplifying the business in general. And I would also like to know if that opens space for you to reduce your G&A and CapEx and have more productivity at the store because your staff works on the retail side and also on the services side at the stores, right? That is a great question, Sabita. It's all about balance. We are going to focus more on our core, but our core is not pure retail. Our differentiating factors, our value proposition is to be a health care agent in the communities where we are located. We support health care of the people who surround us in our community's offering. added value services to the distribution of medication. So yes, we are simplifying the strategy, especially when it comes to the healthcare part of our strategy. But we still have our ambition to step out of our core business and go towards services and added things. But it's not the same strategy that we had in the past, the pure retail. Now the segment that we want to address is defined. and we believe that they are the most relevant ones. And we want to focus our best assets to offer the best value proposition. And that includes the retail operation. That also includes the digital capabilities that we've built over the years. And it also includes the services, the low-complexity services that the pharmacists can offer at the stores, in the service rooms, and also at the counter, solutions in terms of compliance to treatment and subscriptions as well. So, yes, we are simplifying, but be careful so as not to interpret as an extreme simplification. The differentiating factors will be maintained, and the digital players will not be able to offer the same solutions that we do, and that remains part of our strategy. But, yes, we do have a sharper focus on health care and digital assets. especially in the competencies that we have the right to win in. We don't want to steer away too far from our strengths where we can make a difference. And we should also remember, Cepeda, that we are the biggest employer for pharmacists in Brazil, 15,000 pharmacists. Most of our store managers are pharmacists. So we provide specialized service. It's not just selling boxes of medicines to our customers. Melissa, our VP of operations, is actually finishing her studies to become a pharmacist. So we're doing everything we can to make this company a healthcare one, which is also a retailer and not the other way around. And from our numbers, you can see that very clearly, Sepeda, all the customers that receive some sort of healthcare service has a higher engagement level, be it healthcare service customers compared against those who never had any service at the stores. The lifetime value of those customers is longer and if we look at those customers' journey, we can see that our role in their lives increases over time. For example, when the pharmacists get in contact with them to see if the treatment is going well, and we compare the intensity of their contact with us before and after that contact, and the LTV always increases. So any healthcare layer that we can add in our territory adds a lot of value, and we become even more important in the lives of our customers in the segments where we are present. And it's just about sharpening our focus and getting a little bit closer to the core, those areas where we can deliver much more than the competitors can. And do you think you can reduce expenses because of that? I think that expenses in general will continue to be diluted over time. I don't see major investments happening in the future, and I don't think that there's going to be a major reduction either as the one that we have this year with 50 BIPs in our G&A. And I believe that most of that reduction effort is behind us, but we do see a continuous improvement over time. Thank you very much, Mauricio, for your question. The next one comes from Daniela Ager with XP. Please go ahead. Hello, good morning, Raduan and Flavio. Thank you for taking my question, and congratulations on the results. My question is about growth. I think it was the main highlight. The growth was exceptional this quarter. And what really caught my eye is that the growth happened across the board. JLP1 is an obvious strength for you, but also HPC was a very good surprise. So many things caught my attention in that growth. And thinking about this quarter since it was so strong, let's look forward and think about the main levers for your growth. GLP-1 is a very obvious one, but if you can talk about other opportunities, any specific factors that are going to drive your growth, I don't know, maybe you can expand your overshare because you see potential in it. If you can give us any more color about how you are going to maintain that pace of growth and what kind of intensity can we consider for the future in the main categories, that would be very helpful. Thank you very much. I cannot give you any specific guidance, but I can give you overall numbers. Well, the sales performance was indeed very strong. We had a market share gain across the board. we gained market share in the market because we believe that the independent players are losing strength because they are not participating in the GLP-1 game or maybe because they did not go digital. But when we look at the main chains, we gained market share from them because we strengthened our value proposition. So we won against the big ones as well. Now we are looking at things less by category but more by customer segment, the segments that we want to cater to with a stronger value proposition, which is going to make us more important in those customers' lives. Of course, GLP-1, drugs... are growing on a starting point that was not so high last year because the inventory struggled a little bit. And the second half, the GLP-1 starting point was a little bit higher. But also in the second half, we started to see generics, or at least we believe that we are going to start seeing generics coming into this game. I believe that we can have a growth phase that is going to depend on our aggressiveness on OTC and HBC and the entire medication operation. So we want to grow in a balanced way across all categories, excluding GLP-1. I don't think one category is going to grow much more than the others. Generics grew a little bit more recently because there were two patent expirations that were very significant, but I expect to see a well-balanced growth across the board, excluding GLP-1 trucks. I talked about the 1.7 growth year on year, but more than one point in our growth, in our share growth, came from LJLP1. So it is, of course, important, but it does not account for all that growth. And over the year 2025, we decided to exercise a few muscles that were not so active in 2024 and earlier than that, which is HBC. We learned HBC. how to manage the HPC prices more actively and more frequently. We learned how to put products on sale and then remove them from those promotions. We learned how to do things with influencers and digital channels. We used to do that in the past, but not so intensely. And we decided to exercise that muscle and gain strength on that side of the business as well. And that's going to make a difference going forward. This year is very important for us because we have many public holidays and the World Cup as well. So we need to know how to communicate with those customers effectively. It's going to make a huge difference. Thank you very much, Daniela, for your participation. The next question comes from Joseph Jordan with JP Morgan. Hello. Good morning, Raduan and Flavio. Thank you for taking my question. I want to talk more about expansion. You said that it was a record-breaking growth with an IR of 25%. So I want to know more about that expansion. We might not have seen such great expansion in previous periods. And why is it happening now? Are you investing in larger stores and better locations? If we look at the industry as a whole, 2025 was the first year where we had a net growth. decrease in the number of pharmacies in Brazil. So I'd like to isolate those factors and understand the picture a little bit better. And inventory increased significantly. So I would like to know more about that. Is that related to GLP-1 drugs? or is it just because you need inventory to grow the business? Thank you very much for your question, Joe. It is a pleasure to talk about the expansion of our store base. I work very actively on that front since I joined the company 14 years ago. The returns have been better and better. The main factor here is the quality. There's a whole science behind finding the best locations to open stores. We actually opened many more stores than the 3,500 stores, considering that we closed a few units. But we are obsessed about managing the new stores very actively, and we also created a toolkit that allows us to apply all the scientific knowledge, quote, unquote, that we have on this. And, of course, with our culture, our people, that's the unique factor about us. So our decisions about this are also very qualified. And, of course, we have great skills. We know how to do it, how to open new stores. But that is not reason for us to simply open stores for the sake of opening new stores. Our focus and our criteria, a strong set of criteria that we have continues the same. We need to take all of those skills into account and talk about the possibility of opening new stores with a committee that meets every Monday. So it is a process that takes a lot of things into account. We are not opening larger stores with more parking spaces. What's happening is that we are being even more selective about the places where we decide to open stores. We have smaller stores as well in... underprivileged neighborhoods because other stores are closing so that open space for us to push the frontiers going to underprivileged neighborhoods and also in other towns smaller towns all around Brazil Another thing that favors our expansion, Joe, is that we created a brand that is strong and renowned all around the country. The fact that we built a brand and a value proposition that is equally recognized, regardless of where you are in Brazil, favors the efforts of opening new stores. If our brand was only strong in our place of origin and in other regions the brand was not that strong, the results wouldn't come. So the expansion also lies on the factor that we created a differentiated value proposition all around Brazil. Our competitors don't have the same benefit, and that's why they are limited in terms of expansion. When it comes to inventory, we had a change in the inventory front. Our new VP of supply chain is here with us at the studio. He had been working with us for most of our year, and many of the improvements in our logistics chain changed. were spearheaded by João and his team. He used to be a consultant and now he is the leader of that department. He is now part of our family and I'm certain that there's still a lot of work to be done by himself and his team. and they will continue to reduce inventory, improving our cash cycle. But, again, we don't want to see a sharp reduction quarter on quarter or month on month, but I do expect to see an improvement. I don't think our inventory level is the optimal one. I believe that it is going to change from now on. Thank you very much for your question, Joseph. And now the next question comes from Irma Scars from Goldman Sachs. Hello, good morning. Assuming that the environment for your company and retail and digital platforms in general will continue to be intense in some categories, do you think that you need to make more investments in prices and promotions? And what are the efficiency levers in terms of promotions and sales and negotiation with suppliers? use to be able to offset that pressure on your margins, on your gross margins in particular. Thank you, Irma. Well, over the last months, we did not feel the need to invest in more and more promotions and sales. We signaled that we would increase intensity on promotional actions to improve our competitiveness. And in the second half of the year, we got to a level that is a little bit higher than the past, but it is now stable. Therefore, we have been growing in HPC at healthy levels. And is that guaranteed that it is going to be stable forever? No. The market might take steps further, and we will react accordingly. We were able to offset that factor thanks to partnerships with the industry, with the suppliers, with negotiation strategies that proved efficient. They help us be more competitive. And we were able to do that by finding the sweet spot in the prices. And now we have a project with a consulting firm that specializes in pricing and promotions. And the consulting firm is starting this month to help us be more efficient in investments and gross margin. So I feel very confident that the competition in HPC will continue as it is right now. And even if we see more aggressiveness from competitors, we will make use of the lessons we learned over the years to offset part of the investments, or we might divest in some categories or regions so as to offset those effects, which we did last year. We were very fortunate to find the right places to invest and divest, allowing us to invest more in HPC and adding HPC to our performance. So we have been very accurate in our decisions to invest in all of those factors, and we want to be more and more precise about those investments.

Building upon that and sharing some of the figures, our gross margin went to 27.6 in the quarter. 27.6 to 27.4. 20 BPM of drop in the quarter year over year. considering that in 2024 we had not even half of a GLP-1 as we have it. GLP-1 alone amounts to the whole dilution. If we had just this indicator, it would amount and explain all dilution. All effects XGLP-1 were neutral or contributed positively to our gross profit. The market liked to see all the different lines, but I think you'll have to consider EBITDA. What is our strategy? We want to activate stores. Our unit economics based on one store. It's a store with fixed expenses, rental, salary. These are fixed expenses throughout the year. So additional sales will help us dilute our fixed expenses. If thanks to investment in competitiveness, we are bringing more flow and sales, the delta we have is offset sales. If we do it well, it gets further improved and bring positive results to us, such as the third quarter and fourth quarter results. Thank you. Thank you, Irma, for your question. Next question by Thales Grinello from Safra. Good morning, Red One and Flavio. Thank you for taking my question. I'd like to talk further about efficiency in your expenses and your new project. of stores focused on well-being, HPC. Have you opened any new stores with this new format in the Investors Day? You talked about it. I don't know whether you have opened new stores or not towards that. And what is the performance of the stores? Do they need consultants? Do they need different staff? And how does it interact with your expenses from now on and the expansion of this kind of store? Concerning gain of efficiency and expenses, let me give you a general guidance because we expect to maintain this wave of dilution. We focus on efficiency, and we want to have discipline in capital allocation. And these are very strong drivers in our company. We know how important it is. We were very fortunate during 2025. We have delivered excellent results. We've really improved what we expected. Digital practices, for example. We have reorganized our squads, and we have evolved so much in the use of technology and AI to develop code that on the second half of the year, we had a smaller number number of people but the release and the support that we had was better than in previous years even though we had fewer staff present and we expect a natural if progression towards that. So we expect to keep on improving our OPEX and CAPEX efficiency, allocating accordingly our capital, really focused on we have the right win and where we can have quick returns, but no further additional steps. second part we haven't opened this new pharmacy with a comprehensive extended experience into beauty we expect to open the first one in the beginning of the next half of the year it's not only an expanded assortment it's a different experience so assortment layout service of beauty consultants, yes, health services that can really offer the best. It's a different store bringing the best to offer, but of course it is going to impact a lot the experience expanding the assortment of beauty products. It's expected to be going into the second half of the year. And it's going also to teach us a lot about learning. So how can we adapt different clusters? How, based on the learnings of HPC with a more expanded assortment, what can be learned from it and help us make an adaptment to our shopping mall stores? where we can have more focused on beauty, skin care, more than medication or regular HPC. This is a type of store that's going to teach us a lot for the company as a whole. Not open yet. You are all going to be invited when we open our store, but we expect it to be half of the year. Great, thank you. Thank you, Thales, for your participation. Next question, Leandro Bastos with Citi. Good morning, Raduan and Flavio. Thank you very much. I have a question about GLP. One, you've talked about the penetration of low double-digit, as you mentioned, but considering the market potential and all advantages that you mentioned for the company in the category, What would be the speed of sales penetration? Would there be a similar kind of gain in sales of GLP-1 or not? That would be my first point. Secondly, a specific question about supply finance. to understand the nature of this entry. Is it something new that you've started, just done? Second part, Flavio wants it. Now, GLP, it's all supply and demand. Unrestricted demand, this is what we see. We had 5% market share even before Monjar was being sold in the last quarter. We reached our low double-jaded number. Can it go above that? Well, it could or would depending on the supply. we still have intermittent supply by the industry, especially doses of 2.5 and 5. If in the first half of the year we have higher inventory levels, probably numbers will go up. Second half of the year, when generic comes into the market, there is going to be broader access. In the first half, I cannot anticipate what kind of increase it will be depending on the supply. Demand is a given. If we had higher inventory, we would certainly grow. I would like to thank the main players of LP1. They've been working hard to provide product availability. It's been increasing quarter over quarter. They've been helping. But there are some global limitations of raw material. It's a demand from all over the world. But it depends on product availability. We will grow depending on product availability. Stof and I have been involved in calls sometimes, just one hour call to talk about JLP1. There are just so many layers involved. What Radwan has said is very to the point. But I like to talk from the perspective of modes and the rights to win. Our company has been in existence for over 100 years, and its first pharmacy has always been focused on serving the population. Yes, we were opened in the high-income areas of the city. Now we have 3,500 stores within one kilometer radius worldwide. We just cover a lot of the high-income social classes. They are here around our stores. 51 million Brazilian consumers that buy from us every year at an average frequency of eight transactions per year. the most sophisticated consumers, they can afford these kind of products. We have frequency. We have engagement. So this is right to win. On the supplier's perspective, we are the largest partner of the suppliers and they want to sell to us as well. It is a constant dynamic. Concerning supplier finance, this is a very simple activity. It is an anticipation of payment to our suppliers or retail does it, no secrets there. It brings a lot of positive results to us. There were some entries which in terms of expenses were not made. The activity contributes positively to our results. Revenues and expenses. In expenses, for three continuous quarters, we didn't make any entry, and this is why you see in the results, financial expenses offsetting the previous quarters. In other words, if we had accounted for all expenses, nobody would even notice that because it's neglectable. When we add that to the revenues, this is really positive and contributes a lot to our results. What were the revenues in terms of supply finance? This is not a result that we share. I apologize. Okay, no problem. Thank you. Have a great day. Thank you, Leandro. Our next question comes from Rodrigo Gastin of Itaú BBA. Good morning. Let me go back to GLP-1. A specific question I'm going to ask your help to try to understand seasonality throughout the year. It's a new product. We don't have any track record yet. Just trying to understand seasonality. how seasonality of the product should be. Have you observed any changes? I don't know if there was a problem of supply of some of the suppliers. We've heard that from some other pharmacists. Had there been a drop in GLP-1 at the beginning of the year, meaning that the second half GLP-1 drugs are used more frequently because of summertime? I don't know. I think it would be interesting to try to understand seasonality of the product and understand the dynamic of GLP-1 in the first part of the year. Maybe nothing has changed. I don't know. Secondly, about the discount of generics. This week? There was a price reduction, second pen offered for free. Now that you are going into generics, how are you dealing with that changing prices? Have you already fine-tuned how this is going to be, and how are you getting prepared to that? Thank you. I don't know. You were a specialist in GLP-1, a wonderful paper you wrote. Great. We all know that consumers are always getting prepared to go to the summer vacation, trying to get slimmer and all that. But it's difficult to predict anything because there has been always shortage of product throughout the year. So we don't know really how demand oscillates or fluctuates. It's not because of demand, but rather of supply. Based on numbers, I wouldn't be able to infer any kind of seasonality. Maybe before the summer season, there would be an increased demand similar to other characteristics of cosmetic and well-being. I don't know. But the gains for well-being, for self-esteem are just so significant. And people say, I've seen what my friends have experienced. They're feeling much better. These are real-life world, real-life examples. And that will go beyond the idea of winter, summer. I believe people are going to... have continuing treatment with GLPO1 regardless of any seasonality. We've also seen that it should be continuum treatment even though it's going to be a smaller dosage offered at higher intervals, rather than having initial treatment, losing weight, and then just quit using the drug, it's expected to have a continuous use of the medication throughout time. I don't think seasonality will be major, but based on data, we cannot really say anything. Second part of your question about price. This is microeconomics, supply and demand, again. There are two similar programs, semaglutide, liraglutide, but as there are very few competitors, they just got into the market with prices closer to the main agent, and they haven't got any relevant penetration yet. When new generic agents come into the market, there's going to be a higher doubt of price. as there are going to be similar agents, generic agents. Naturally, the reference agents will try to offer more attractive agents, as we've seen for WeGov. What you've said in terms of projection in your papers are very good references. Maybe there would be a 20%, 30% drop. Maybe eventually it will get to a 50%, but rather than $20 billion, it will be a $50 billion market. I don't see anything differently from what I've read in your paper. You talked about the second unit for free. The offer is the first treatment, the first pan of the treatment is offered for free. But if you buy the whole treatment, and, of course, it impacts somewhat. It's the first pan for free, not the second one. all the different papers, all the different publications in the market. They've emphasized a number of points, and I've just heard today, according to WHO, in Brazil, 50% of adolescents are already overweight. This is a different kind of audience, different kind of consumers. In GLP-1, What we have all been addressing is one million boxes being sold per month. Once additional needs are identified, the market will inevitably be expanded. Wonderful. Thank you very much. Thank you for your answers. Thank you, Rodrigo. Next question by Luke Piazzi with UBS. Good morning. Thank you for taking my questions. I have two questions. First, GLP-1 again. You've talked about the fact that you have one-third of share in the category. Considering the strong performance of same stores of 14.4, has the share increased in the fourth quarter or not of GLP-1? Could you break down the share by molecule, semaglutide, desipatide, or at least tell us whether the share you currently have of Mongero is higher than one-third? Second, about 4Bio. You said that the sale would generate $60 million of income tax. Could you please tell us a bit more about the time you expect to monetize that amount? That would be great.

Our market share in GLP-1 drugs is difficult to track because of how intermittent it is. It really depends on your inventory of 2.5 grams and 5 grams. you know, the competitors have an inventory while we don't have an inventory of those products and the other way around. And I am sure that in general, our market share is higher than one-third, the one-third that you mentioned, be it in JLP1 or Manjaro. It is higher than that if you look at a longer track record. And we believe that it is going to continue to be so. It is going to continue to be higher than the competitors because we are closer to the consumer's and there is a discount if you purchase the products online, and our digital channels offer a better journey than the competitors' journey. So it's not just the fact that we have customers in the high-income segment of the population, but also because we are present in digital channels. That's why we have that overshare, and we expect the situation to continue. Now, about the $16 million, it's actually simple. we have that amount to recover because of the shareholders' equity invested. we are entitled to that amount, the $60 million. It was not monetizable before because we had deferred a shareholder's equity, but after the transaction, we are going to be entitled to receiving that amount. And because of tax incentives, our shareholder's equity was completely detached from the investment of $400 million. And now we will be able to recover part of that equity as income tax. And we estimate it is going to be around $16 million. It could be a little bit more or less than that. Thank you very much. I think we have one last question. The next one comes from Gustavo Frutini with Bank of America. Hello, Roduan and Flavio. your online sales have been growing consistently, but still the pressure on gross margin is under control. I believe you gave us some indications of why that happens, including the increase in your market share from the app, but I would like to know more about the difference between your margins in brick-and-mortar stores and digital channels. And also, I'd like to know more about the flow of customers into your stores. Do you think the growth of sales comes from new customers or maybe higher tickets, including JLP1 drugs, or maybe those customers come into the stores trying to buy those products and end up buying other products as well? What do you think about that? Well, we invested in HPC to be able to fund the promotions in HPC, and we believe that the characteristic of digital customers is different from the average in the market. Those are not people who are just surfing the Internet trying to find the best prices and receive the products at home. Our app is usually used for convenience and also access to better prices. And that allows us to... bring the prices online closer to the brick-and-mortar prices. And also, we have the Click and Collect initiative. The customers can purchase the products online and come to the store to get their products. That's how we do it, through the click and collect journey. And our delivery services are very different from the competition. We promise to deliver the products in less than one hour. And that's how we have been operating with very competitive shipping costs. we usually deliver the products in 40 minutes on average. And that's why we don't feel mandated to offer the best prices online because the prices are just part of the overall value proposition. And that's why the prices, the difference of prices between the online channels and brick-and-mortar stores is not that large. And also, penetration of the GLP-1 drugs is very important. The penetration is 29%. If you look at GLP-1 alone, the online participation of those drugs is completely insane. If you look at the market as a whole, the customers usually originate their orders online, and that's why the growth has been exceeding 50%. And even if you exclude GLP-1 drugs, the structural growth in all segments online is still higher than the growth that we have in brick-and-mortar stores. And as a complement, it is important to highlight that the digital transactions are not just digital transactions with any customers. Those customers are recurring ones. Only 3% of our digital transactions base... is done by customers that only buy online. That means that 97% of customers buying online also buy at the stores. So the digital channels are just for convenience, the convenience of customers who are already engaged with the company. and not really specific channels fighting against other specific digital channels. And that converts into LTV. We are giving customers more flexibility. Depending on the time where they want to buy a product, they can choose to buy online or at the store. Also, the economics of the digital channels are very close to the economics of the stores, so the contribution margin of a digital transaction is basically the same or very close to the contribution margin of a transaction at the store. So the digital channels will give us a lower margin because of the prices that are lower, but that difference is growing smaller and smaller. The digital world also has a very light expense base because we just dilute the expenses that happen at the store. So at the end of the day, if there's a gap, it's basically totally offset due to the expense dilution. So for us, it doesn't matter. We just want customers to buy however they want. To us, it doesn't make any difference. Thank you, Gustavo, for your question. With that, we conclude the Q&A session for today, and now I would like to turn it over to our executives for their closing remarks. Well, first of all, it is pleasure for me to be here. I'm proud to be here reporting such great results thanks to all of our employees who are behind these great results that we are reporting NQ for. It is a record-breaking quarter for us. We grew by 23% on retail, which is not to be sneezed at. And not only that, we also gained 170 bps of market share in 12 months. We delivered a record-breaking NPS at the stores and also on the digital channels. HBC went back to the performance we wanted it to have. We diluted our GNA expenses in 50 bps in the year. We grew our EBITDA by 100 bps quarter-on-quarter and 50% year-on-year. Across the board, we delivered solid results. Having said that, we are not here thinking that we won the game and that we don't need to do anything else. We are confident, we are happy, we have an understanding that these great results bear witness to our hard work, but we are committed to continue on this journey. I was here in the difficult moments, and I was not here to give you excuses, which are different from explanations. We gave you the explanations. We told you that the results were short of what we wanted the results to be. It was a reason for frustration for us and you as well. We shared our frustration with you. We were honest, transparent, and we told you what we were going to do. We tried to show you that the results were not on par. with the company that we built over so many years. And the numbers are here. The numbers compatible with our potential are here. We delivered them this quarter. And I had the pleasure to be accompanied by the other leaders in the company. motivating them, but who actually delivered the results were the 72,000 employees, our biggest assets. And only we have such a great workforce. We don't have just one team. We have the team. that complement the assets that we built over the years. I am confident that there's still a lot of great things lying in store for us that we are going to deliver to the society and our shareholders. If you put together our assets, which are unique, we are second to none in terms of brand, culture, proximity to the customers. And if you add that to the strength of our team, and what the team did this year, where we started and where we got. And with that speed... You know, nobody else can do what we did. If you put together our assets and our team, we have a bright future ahead of us. And if we add a third element, the lessons that we learned and how humble we were to learn the lessons and understand that we need to focus more on our core and the areas where we have the right to win. Thank you very much, each and every one of you in our team. Thank you to the board members, the controllers that helped and supported us in the difficult moments. And thank you, the investors, the shareholders, especially the ones that believed us in the moments of difficulty, the ones that were able to look past the results, snapshots, and were confident that there was more to our story. You can count on my commitment and the commitment of those 72,000 people that work with us. We will continue delivering great results to you and the society as a whole. Thank you very much. See you in three months.