Fleury S.A. (FLRY3) Earnings Call Transcript & Summary

Good morning. I would like to welcome you all to Grupo Fleury Earnings Call for the Fourth Quarter 2024. We have here with us today, Ms. Jeane Tsutsui, CEO of the company; Mr. Jose Filippo, CFO; and Mr. Renato Braun, IRO. Let me take this opportunity to inform you that this event is being recorded and that we also have simultaneous translation into English. The company will present its results, and then we are going to start our Q&A session. At the end of the session, Ms. Tsutsui will also make her final remarks. All the numbers that are going to be mentioned here are compared against the same period in 2023, unless otherwise specified, and they have been rounded up to the nearest thousand. Before moving on, we would like to point out that this presentation may contain information about future events. Such information is not only historical fact, but would reflect the wishes and expectations of the company's management. The words believes, expects, plans, forecasts, estimate, projects, aims and similar words intend to identify statements that necessarily involve known and unknown risks. Known risks include uncertainties which are not limited to the impact of price and service competitiveness. Uncertainties also include market acceptance of services, service transactions of the company and its competitors, regulatory approvals, currency fluctuation, changes in the mix of services offered and other risks described in the company's reports. I would like now to hand it over to Ms. Jeane Tsutsui.

Good morning, everyone. Thank you for your participation in the earnings release call to present Grupo Fleury's results for the fourth quarter of 2024. In our call today, we will start with an overview of our group going through differentiation initiatives such as the integrated centers of Fleury brand up to the financial highlights of the quarter. In '24, we had positive results from our strategy of strengthening the diagnostic medicine core and offering outpatient solutions that complement the health care journey, all driven by the successful integration process with Pardini Group. We have executed this merge as planned, capturing operational synergies and promoting the combination of cultures and processes. The company resulting from this integration has consolidated as a reference player in the market, expanding our geographic presence and strengthening business complementarily. As you can see on Slide 5, we have a robust network in B2C diagnostic medicine with service units from different brands that serve the premium, intermediate and basic segments in 14 states in addition to Lab-to-Lab services with partnering labs throughout the national territory, bringing resilience to our operations in a challenging macroeconomic scenario. In addition to diagnostic medicine, which supports 70% of medical decision-making, we offer prevention services, such as immunization, health checkup, clinical consultation by telemedicine, full-day outpatient care services in some medical specialties and treatment with outpatient procedures. On Slide 6, we can see our 4 avenues of growth. The first one is B2C diagnostic medicine, which amounts to 67% of the total revenue of our group. Mobile services has maintained its expand robust in 2024, reaching 7.6% of our total revenue. Our strategic B2C initiatives are also worth mentioning. In April, we announced the acquisition of Grupo San Lucas, marking our entry with service units in the State of Santa Catarina. In November, we announced the acquisition of Confiance Medicina Diagnóstica in Campinas in region, still waiting for antitrust authority approval. With 25 service units, Confiance will expand our capillarity, our footprint and allow us to capture relevant operational synergies given the proximity to the city of Sao Paulo. These initiatives have been carried out with very rigorous discipline that has been part of our capital allocation strategy over the years, which will be in place as we continue to evaluate further opportunities in 2025. Next, we have the B2B diagnostic medicine, which corresponds to 24% of our total revenue. After business combination, Lab-to-Lab Pardini has its exam portfolio expanded with new communication positioning and potential to use greater number of technical areas for different processing of tests and exams. The third avenue of growth are Novos Elos, New Links, which amount to 80% of total revenues, which gather 5 specialties, 9 brands and 33 service units, covering the areas of infusion of immunobiological drugs, orthopedics, ophthalmology, fertility and oncology. And finally, we have the health care platforms, which amount to 1% of our total revenue. On Slide 7, we see in the graph on the left, the growth of Fleury Group over the years. The chart on the right shows the representativeness of each business and brand in total revenue. You can see that in recent years, we have accelerated the pace of growth of Fleury Group. In 3 years, we doubled our revenues from BRL 4.2 billion in 2021 to BRL 8.3 billion at the end of 2024. We have also brought new businesses and services that have diversified our revenues. Currently, B2C segment amounts to 67% of total revenues and brand Fleury amounts to 25%. The business combination with Pardini has strengthened the B2B segment. And since 2021, we have had New Links and platforms, the other 2 lines. This diversification of revenues and paying sources gives to Grupo Fleury greater resilience, ability to capture market share and to be positioned as one of the health leaders in Brazil. Let's now talk about how Grupo Fleury has been innovating, such as the offer of integrated centers. Over the years, Fleury brand has maintained its leadership position in the premium diagnostic medicine market and has gained market share through the offer of an expanded portfolio of tests and services with excellent medical team, incorporation of new technologies that add value to patient care and positive experience of patients. On Slide 9, we see how the integrated medicine centers have contributed significantly to increasing our differentiation in areas that integrate diagnostic and therapeutic services, modern technologies and supported by specialized medical and backup teams. Patients perform tests and services as in sequence in one single period of the day, beginning time, convenience and also safety. The physicians have in each center a partner in the investigation of the clinical hypothesis and in approaching their patients with direct support of our medical consulting groups for pain sources. This integrated flow enables faster diagnosis and avoid unnecessary tests. Fleury brand already has a number of integrated centers. And in 2024, 2 new ones were opened, The Integrated Endometriosis Center and The Integrated Neurology Center. The Endometriosis Centers is a space dedicated exclusively to advanced diagnosis and treatment of the disease, and it complements the women's health journey as we already offer a number of services to all stages of care of women. The growing number of patients with cognitive impairment was the starting point for the company to open the integrated neurology center dedicated to neurological diseases, which brings together in a single area, all technological innovation, diagnostic imaging to solve the needs of patients and referring physicians using state-of-the-art equipment methods and technology in the world market, such as the most advanced techniques of magnetic resonance imaging, computer tomography, ultrasound and electroneuromyography. In addition to the integrated centers, another highlight in innovation has been the greater digitalization and use of artificial intelligence in our services. The year 2024 was marked by significant progress in digital scheduling for brands, Fleury, a+, Sao Paulo and Labs, enabling our customers to make scheduling without interacting with the call center. Digital acceleration resulted in improved customer satisfaction, reduced service costs and attraction of new customers who accesses our brands exclusively through digital channels. We also have currently nearly 50 initiatives to apply AI in practice. These examples demonstrate that Grupo Fleury incorporates technological advancements, prioritizing use of resources and based on strong knowledge and health. This position allow us to select what really makes sense, considering the pillars of operational efficiency gain, customer experience improvement and differentiation of our services. Before introducing the financial highlights, I would like to remind you that we provide, in addition to accounting results, values on the same basis for the periods as shown in the table presented on Slide 11. Given that the business combination between Grupo Fleury and Pardini took place in May '23, fourth quarter '24 captures the result of combined operation in both years '23 and '24. There are differences between the accounting and pro forma results only in the year-to-date. Now going to Slide 12, we have the financial highlights of the fourth quarter '24. So in the consistency of the delivery of results, gross revenue reached BRL 2 billion, growth of 8.7% over the same period in 2023, with highlights for brand Fleury, which grew 9.5%. The other brands in Sao Paulo grew 13.5% and the brands in Minas Gerais increase of 9.1%. In addition, mobile services evolved 18.2% in the quarter, amounting to 7.7% of total group revenue. Year-to-date, gross revenue reached BRL 8.3 billion, growth of 19.5% over 2023. 7.4% of which was pro forma. The highlights are mobile service, which expanded 20.4% and 70% increase in pro forma, amounting to 7.6% of total revenue and B2B, which grew 43.5% in the year, 9.7% of which in pro forma. The other brands in Sao Paulo grew 13% in pro forma. Brands in Minas Gerais grew 10.4% pro forma. EBITDA reached in the fourth quarter '24, BRL 405.75 million, 7.9% higher than the fourth quarter '23 and reaching margin of 22%. In 2024, EBITDA was BRL 2 billion, growth of 19.6% over '23 and 9.4% on pro forma basis. EBITDA margin for the year was 25.8%, 64 bps higher than in 2023. Regarding net income, in the fourth quarter of 2024, we reached BRL 84 million, increase of 3.3%. In the year, we had net income of BRL 612.2 million, growth of 32% compared to previous year with margins of 8% and I mean BRL 616.2 million. Let me now hand it over to Jose Filippo, our CFO, who is going to tell us in further details our financial performance.

Thank you, Jeane. Good morning, everyone. Now let's go into the details of financial information. Slide 13, we can see that gross revenue reached BRL 2 million in the fourth quarter '24, increased 8.7% compared to the same period of previous year. In the year, we reached BRL 8.3 billion, up to 19.5% over '23 and 7.4% in the pro forma view. Moving on to Slide 14. We have observed a significant increase of 10.4% in service units in the fourth quarter in terms of additional revenues with 9.1% resulting from an organic growth. In the consolidated for the year, expansion was 14.1% with an emphasis on acquisition of San Lucas Group in Santa Catarina. Organically, the growth was 6.2%. Now looking at the pro forma results, the other brands in Sao Paulo increased 13% in the year, while the brands in Minas Gerais observed increase of 10.4% in the year. Brands in the State of Espírito Santo, Goiás, Pernambuco and Rio de Janeiro presented very good organic performance and have gained market share. Brand Fleury increased 4.6% in 2024, demonstrating solid performance in a market which is still stable. Slide 15, we can see B2B business, which increased 5.5% in the fourth quarter '24 over the same period last year, reaching BRL 465.7 million. The good performance of Lab-to-Lab has offset the termination of some customer contracts in hospitals. Year-to-date, the growth was 9.7%, reaching BRL 1.9 billion. In Slide 16, we see the performance of New Links and Health platform. In the quarter, the increase was 3.9%, reaching BRL 174.9 million, very good performance in orthopedics, ophthalmology and fertility, offsetting the greater offer services and infusion market. In 2024, we reached BRL 762.5 million in revenues, growth of 9.9%. Next slide, Slide 17, we can see gross profit of the fourth quarter '22, which had 13.2% increase, BRL 473 million, margin of 24.7%. In 2024, gross profit increase was 10.7%, reaching BRL 2.14 billion, margin of 27.9%, which is 100 basis points higher than the same period previous year. This behavior is mainly explained by dilutions in some cost lines, such as the effect of some rationalization programs involving personnel and medical services, showing a dilution of 27 bps in direct material and also tests. Now going into Slide 18, we can see that on the fourth quarter '24, operating expenses totaled BRL 252.6 million, amounting to 13.7% of net revenue, 113 basis points over the same period last year. This result can be explained in part by the increase in general and administrative expenses, a consequence of some items related with compensation, such as salary additional increases and also a career plan, which are not nonrecurring. In 2024, operating expenses reached BRL 945 million, amounting to 12.3% of net revenues or dilution of 51 basis points over the same period in '23. Next slide, moving on to Slide 19. We see that EBITDA increased by 7.9% in the fourth quarter '24, reaching BRL 405.4 million, margin of 22%, in line with the same period the previous year. In the quarter, this result reflects the increase in gross margin compensated with greater relevance of operating expenses. In the year, EBITDA increased 9.4%, reaching BRL 1.98 billion, margin of 25.8% over the performance of 2023. Moving on to Slide 20, we can see our net income grew 3.3% in fourth quarter '25, reaching BRL 84 million, net margin of 4.6%. Excluding the amortization of the balance with the combination with Grupo Pardini, net income was BRL 95.6 million, margin of 5.2%. In '24, the net income was BRL 616.2 million, net margin of 8%, which means 32% higher performance over '23 or 80 bps in the net margin. Moving on to Slide 21, we see that CapEx investments amounted to BRL 210.6 million in the fourth quarter '24, 4.8% over the same period in 2023, expected acceleration, as we have expected. In the year, CapEx totaled BRL 488.1 million, 80% above that observed in 2023. Slide 22 shows operating cash generation, which reached BRL 563.6 million in the fourth quarter, growing 33% as a result of the increase in EBITDA over the previous year. In the year, the increase was 34.1%, reaching BRL 1.93 billion, which represents cash conversion of 97.4% of EBITDA. On Slide 23, we can maintain leverage of 1x net debt over EBITDA as a result of increased cash generation and higher EBITDA, which is very appropriate for this level of high interest rates, with this level of leverage, which is below our limits of our covenants. Slide 24, we can observe the amortization schedule of debentures, financing lines and acquisitions of Fleury Group, showing our robust cash position in relation to our obligations. Throughout the year, through new fundraising for paying current debt, we have extended our average maturity from 3.5 to 4.2 years, and we have reduced our average cost in 46 bps, which is the position at the end of the fourth quarter '24. We still have a healthy debt profile with no concentration in maturities. Before we start the Q&A session, I would like to hand it back to Jeane to close the presentation. Thank you.

Thank you, Filippo. The fourth quarter of '24 served as a milestone on the end of a year of great achievements for Grupo Fleury. Integration with Pardini was extremely important in our history, consolidating our position as a reference in diagnostic medicine in the country. Throughout the process, we have captured operational synergy as planned, strengthened our service network and expanded the complementarity of our businesses. We closed 2024 with consistent growth and discipline in cost and expenses, which resulted in EBITDA margin expansion and 32% increase in net income over 2023. We had strong operating cash generation, cumulative cash conversion of 97.4%. We have also maintained our discipline in capital allocation with healthy ROIC and higher than in 2023. And with that, we can continue to improve opportunities of market share gains in all our growth avenues. We have robust capital structure with reduced debt levels and good financial debt management, which is essential to face a moment of high interest rates. We are committed to the disciplined execution of our strategy of strengthening the diagnostic medicine core and a unique ambulatory care value proposition. Therefore, we are confident in achieving Grupo Fleury ambition to increasingly strengthen ourselves as one of the health leaders in Brazil. that's going to be done through increasingly complete integrated and sustainable solutions in the specific journey of health and wellbeing of people. Finally, I would like to thank the trust of our customers, partnering doctors and shareholders in '24. The support of our Board of Directors, the dedication of the leaders of the group as well as the engagement of our 27,000 employees and doctors are the basis of our success. Thank you very much. Let's now start the Q&A session.

[Operator Instructions]

This is Renato Braun from Investor Relations. The first question is XP of Raphael Elage.

I have 2 questions. First, it concerns the level of denial. We've seen a stability quarter-over-quarter, but we would like to understand better that the origin of that, if it was concentrated or distributed in the quarter and what we should expect ahead thinking for 2025? That's my first question. The second question concerns the performance of some regional centers. We've seen a higher level. I understand that this is probably due to the acquisition of São Lucas, but I would like to hear about other effects with this line. Maybe some changes in terms of strategy in some specific regions or calendar effect? Anything that you might share with us?

Thank you, Raphael. Concerning the level of denials, we can see stability. In the third quarter, of '24, the level was 1.4%, now 1.3%, somewhat above the previous year of '23, but I believe that throughout time, we have stabilized our strictness in terms of processes, receiving cycles, negotiations with health care insurance, and we haven't been observing changes. The origin is very diffused indeed. In terms of denials, we've increased of loss ratio. We've been discussing frauds and now health care insurance are much stricter, and we are getting really adapted to all of that. But we don't anticipate many changes. I believe that this level is what we expect to operate in. Of course, we would like it to go lower and lower, but right now, we don't know what it's going to be and whether there's going to be further reduction. We are doing our part, very well with structured processes. We've made internal changes of the team that deals with the receiving cycle, which responds directly to Filippo, our CFO. And we believe that we are going to maintain very good partnership with our payers. Concerning the performance of our regional centers, yes, there is the acquisition of Sao Lucas. It was our first step in the region of Vale do Itajaí in Santa Catarina, an area of high-income population. We are very well positioned there, which is important. By the end of the year, we've talked about Confiance in Campinas and the region. So throughout time, we've been making strategic acquisitions that position us quite well in regions with high income levels. The other regions, some of them deserve to be highlighted, State of Espírito Santo. We joined the state by the acquisition of Bioclínico, which has been performing quite well and has gained market share. We believe that our discipline, maintaining good quality of services, very good customer service, very good relationship with local physicians and paying sources will take us to consistent growth.

The next question comes from Felipe Amancio with Itau.

I have 2 questions also. First, about Brand Fleury. We've seen an interesting acceleration of the brand. I know there is the impact of the comparison basis, but I would like to understand your perspective for the brand in '25 after its improved performance in '24. The second question about profitability. I would like to understand margins for 2025 as there are a number of moving parts, additional synergies of Pardini's different mix, denial levels, I would like to see what you expect in terms of profitability.

Concerning Brand Fleury, we've seen a very good performance in the fourth quarter, 9.5% increase, we've said in the third quarter that the comparison basis also has a role to play. In the third quarter, there was a question about expansion of Fleury brand of 1.2%, but the comparison basis was 10.4% from the third quarter '23. Now in the fourth quarter, we've shown better performance, 9.5% of the brand compared to growth in the fourth quarter '23 of 4.6%. Brand Fleury is mature, 99-year-old, well positioned in the premium market in Sao Paulo with high market share, has maintained a very good relationship with requesting physicians in terms of satisfaction, indication, references, our levels are quite high. We have also maintained a differentiation of our brand Fleury, new integrated medical centers, expansion of products and service portfolio. We've been growing with mobile service even in a mature brand. But it's important to emphasize that it grows 4.6% in the year because there is a premium market, which is stable in terms of number of beneficiaries. So we gained market share in the market, and it's a significant market share. For 2025, and this is not guidance, of course, we are going to maintain the differentiation of brand Fleury using retrofits to increase revenue per square meter wherever possible, improving our levels of service levels, our welcoming, supporting care and relationship with the medical community, really setting us apart by offering integrated products. We have a number of integrated medical centers with brand Fleury. The center of endometriosis and neurology, which were opened in 2024, will go through maturation, but it's a brand that has maintained its vitality and strength, especially thanks to our medical team and the team that works with us. Very good perspectives in a brand which is quite mature. Concerning profitability, I would like to hand it over to Filippo, who can bring further details.

We have no guidance and no commitment with numbers for margins. But what I can tell you is we expect to maintain our current pace, a perspective of expansion of margins as we've been doing because we expect increasing revenues, something that we've been focusing on. It's important to say that increasing revenues is not associated with an unfavorable mix for the margin. However, expansion means we can dilute fixed costs and benefit from that. In addition, our programs of efficiency and cost reduction are still moving ahead. We have very strong discipline with that. We observe weekly all the programs and initiatives of cost reduction. In general, that's how we expect to do it. It's always good to bear in mind that even though revenue seems to be unfavorable in terms of mix to the margin because of all the factors I mentioned, it also has a favorable side of it, which is ROIC, another important metric that we monitor. Some business lines that bring in more revenues need smaller investments to reach the same goal. It's a mix of all the businesses of the company and the growth of each of the parts. That's how we anticipate 2025.

Next question, Joseph Giordano from JPMorgan.

Let's try to talk about gross margin. There was the effect of some seasonality. How do you expect to see the progression of the margin from a qualitative perspective, right, by business units also because the brand Fleury has grown and probably there was an effect of mix in the margin? And still talking about Fleury brand, how do you see the pressure of paying sources? There was an increase, an average increase throughout the year, but some premium health care insurance plans are, maybe splitting business between you and other business premium brands. So do you see any pressure over your average ticket or the chance of obtaining results? I know that you don't buy supplies in dollars, but some of the supplies inevitably are related with dollars. So do you expect to see any price differences there?

Thank you for the questions, Joseph. I think you've put it quite well. We've been expanding our gross margin, and this is a result of discipline and how we monitor our profitable margins and actions. We have very close relations with our leadership team so that we can gain efficiency. We have all efficiency gain programs, but also another example is digital scheduling, for example, all the investments that we've made in digital, and it has brought concrete benefits. We have started scheduling in our brand a+ Sao Paulo. Now we have in a mais, Sao Paulo, Labs and brand Fleury. This sets us apart. It attracts new customers, digital customers, and it also increases efficiency. Use of scripts with artificial intelligence in mobile services, it has been expanding as well. We've seen 18.2% growth in mobile services, but year pro forma was 17% increase in mobile operations, and we have also benefit in efficiency, thanks to this scripting tools. So as you can see, we've been working with the challenge of a business mix is somewhat different. Brand Fleury amounts to 25% of the total revenue of the group. It's been growing, but there are no businesses together. You've been talking about other business lines, which have different margins. But throughout time, gross margin has been increasing, thanks to our discipline and the way we control our costs and expenses. They are different margins indeed, but over time, they gain efficiency in all our business lines. Considering the pressure of pain sources, we work with outpatient services, prevention, monitoring of chronic diseases, avoiding high-cost events. So we bring integrated solutions to pain sources. We work with health care insurance companies. With increased costs with health, there are some initiatives by co-pay companies, but we have to bear in mind that brand Fleury is based on diagnostic solutions, high-quality service levels, highly recommended by physicians and the integrated centers for high complexity diseases offer a complete diagnostic solution. And therefore, a patient that has a specific condition wouldn't be lost in the system, which would require additional tests. So in terms of sustainability, it is a value proposition, which is quite clear. Premium market is very resilient. The differentiation tends to be perceived, and this is why Fleury brand has maintained its resilience throughout time. And this is exactly what we are going to keep on offering not only in our units, in mobile services, but always with the differentiation I've mentioned. To talk about currency rates, I'm going to hand it over to Filippo.

You see we don't have direct indexation on dollars. Most of our suppliers, whenever there is any connection with international prices, they already give us the Brazilian bill. So there is no direct correlation with the currency rates. Of course, if we have a tougher foreign exchange rates, this is going to impact costs, we know. So we manage our procurement, especially considering the fact that volumes have been increasing, which favors some positive negotiation. But directly, we have no immediate correlation with foreign exchange purchases that are made in foreign exchange.

Next question, Renan Prata from Citi.

A quick follow-up about profitability. You've shown our G&A showing a seasonality and increase. But I would like to know more qualitatively, what you expect for G&A in 2025. Is it going to be similar to what you had in '24? Or do you expect to have further dilution? Anything else? Do you expect to have any reduction in reagents, materials, something that would impact your gross margin?

We've talked about that G&A for the fourth quarter. But these were some adjustments related with salary adjustments and also some adjustments to the profit-sharing plans. We had to make some adjustments, which impact the last quarter. But I think it's important to analyze the whole year. It was 9.9% of the total revenue, something which would be more reasonable to consider. All profitability programs that we've described are going to be impacted and are going to be perceived. We might have some possibilities of gain. But this is how we see it. Now concerning additional costs, we are going to follow closely inflation rates. We've talked -- just talked about foreign exchange rate, which is not directly correlated, but might impact prices in future contract negotiations, but we are going to manage that at each negotiation, always considering the leverage of the size of our company and high volumes. Nothing different from what we've done historically. This is how I would understand G&A for the upcoming year.

The next question comes from Ricardo Boiati from Safra.

My first question concerns your mobile services. Can you please tell us more? This is a product that has been increasing significantly. I would like to understand the perspectives ahead. If you could please tell us more about the growth that you delivered in 2024. Is it based on increasing basis of users? Or is there an effect of any mix of high-added-value tests or the mobile platform per se? Secondly, I would like to hear more about the regulatory affairs. What are the points being discussed? What about the perspective of outpatient services, considering the discussions in the regulatory agent levels and how that can impact your businesses and your operations?

Thank you for the questions. Concerning mobile services, as we pointed out, it is something that has been increasing throughout time. We've been providing mobile services for many years, especially in the brand Fleury in Sao Paulo. With pandemics, it expanded to all regions. And in 2024, we had 20% increase, 17% increase in pro forma. And every quarter, we've been observing consistent growth. There are 2 aspects to be considered. We've been expanding our basis of users and test mix, especially in brand Fleury, where we have a penetration, which is quite high, we expanded the offer of services in addition to clinical labs, some other tests that's polysomnography, also blood pressure monitoring, heart rate, 24-hour heart rate monitoring. So we've been increasing our services. Our penetration in mobile services is different in all different regions. We still have got room to grow, and we can also gain more efficiency in organizing the mobile services. I've just mentioned the example of artificial intelligence in developing the script and also in preparing the routes of the mobile services. We can have better use of the time of our mobile service providers by making better routes. We've also been using our own centers as a hub to reduce the travel distance of our teams. We believe that mobile services still have room to grow and to maintain very specific level of services. Our NPS for mobile services is very high. The experience of customer in terms of convenience and quality of service have been maintained. Concerning regulatory issues, there is a public consultation by the private health care agency. It is a public hearing for the inclusion of new health care plans, including outpatient plans. So I believe we are just in the beginning of the discussion. There's so many questions and data have to be further analyzed for a private health care and the impact of any new service would have, in the universal health care system ex-U.S. in Brazil, there is a technical assessment that has to be made, a discussion of how it should be. This discussion has just started. Public consultation opened on February 18. There are still 45 days for further discussions, and this is something that has to be done. At Grupo Fleury, we have a very clear understanding. Any incorporation, any introduction of new technologies or services have to be carefully made, considering sustainability of the system at large and primarily maintaining it long term. It is -- health is a necessary service. It has a number of challenge of access and sustainability and decisions have to be well considered before they are made. And this is what we've been observing. And of course, monitoring it very closely.

Next question, Bank of America, Flavio Yoshida.

I have 2 questions. One concerning Novos Elos, New Links. It's been growing actually. But in terms of representativeness in terms of revenue, it has maintained its 8% level. You said you wanted to get to 15% of the revenues, but it hasn't. So what has happened? Are we still within the same strategy? Why was the growth not as robust as expected? Secondly, concerning the mobile services presenting good results actually, do you have any expectations of expansion of services? Is it going to be strong in this year because you need no credentialing, right, especially of Brand Fleury, have you transferred already major volume?