Localiza Rent a Car S.A. (RENT3) Earnings Call Transcript & Summary

Good morning, and welcome to the Localiza Rent a Car and Unidas joint conference call, which is also being transmitted in English through simultaneous translation. [Operator Instructions] And we inform you that there will not be a Q&A session for this presentation. [Operator Instructions] The documents related to the transaction can be found at the IR web pages of both companies at ri.localiza.com and ri.unidas.com.br. The conference call audio and the accompanying presentation are being broadcasted simultaneously over the Internet at the prior mentioned IR websites. With us today, we have Mr. Eugênio Mattar, CEO and Founder of Localiza; Luis Fernando Porto, CEO and Founder of Unidas; Mauricio Teixeira, Localiza, CFO; and Marco Túlio Oliveira, the Unidas CFO. Now I would like to hand over the floor to Mr. Mattar. Please proceed.

Good morning, everyone. Welcome to the joint conference call of Localiza and Unidas to announce our intention to unite 2 outstanding companies in the car and fleet rental segments in Brazil. For this very special moment, I have with me Luis Fernando Porto, CEO and Founder of Unidas.

Thank you, Eugênio. Good morning, everyone. In fact, this is a very important day for the history of both companies. On behalf of both, I would like to thank all of you listeners for being able to participate given the short notice from the filing of the material fact yesterday night. Our goal in this meeting is to provide you with the information that shows the best of each company and the opportunity that we will have together to create a company that will be the global reference in mobility, technology and customer experience, increasing the access of individuals and companies to car rental. To begin the presentation, I'll hand the floor back to Eugênio.

Thank you, Luis. Starting on Slide 3. The combined company is born from the union of the leading car rental company with a leader in fleet management and brings the following pillars: the union of renowned shareholders with long experience in the industry, who will continue to play an active role in the company; the combination of 2 teams of high performance and competent professionals who will be very important for the creation and development of innovative solutions; and the ambition to provide to individuals and companies access to car rental, offering customers convenience, cutting-edge technology and the best rental experience through a value proposition. If approved by the CADE, the Brazilian antitrust agency, the combined company will become one of the largest public companies in Brazil in terms of market value, with a global scale and prepared to evaluate international opportunities. We will further reinforce our commitment to the highest standards of corporate governance and sustainability. Moving on to Slide 4. We will give you an overview of the combined company. This company will have an even more scalable and integrated business model. Among the various combined metrics considering the 2019 results released by the companies, we highlight the financial robustness composed by net revenue of over BRL 14.8 billion, a combined EBITDA of BRL 3.5 billion and a net profit of over BRL 1.2 billion. In operational terms, the fleet size of the companies combined consists of over more than 490,000 vehicles, of which 337,000 are allocated in the RAC segment and 153,000 in Fleet Management. Both companies have strong brand recognition, a AAA rating by S&P and would have a combined market cap of around BRL 50 billion, considering the closing prices on September 18. Luis?

Thank you, Eugênio. Now on Slide 5, the current fleet rental markets in the country still have low penetration. In addition, new solutions in mobility and the change in the culture of ownership versus use have been opening great avenues for growth such as short- and long-term rental and subscription cars, ride-hailing and an increase in the addressable market related to tourism.

Now moving on to Slide 6. It's worth mentioning that we are talking about 2 highly recognized brands with technological solutions capable of integrating the customer journey and providing the best user experience. We are confident that with the use of innovative technological solutions, we will be able to delight our customers more and more, providing a unique experience in the rental journey from the moment of choosing their vehicles, going through the experience in stores, the rental period, until an agile, quick and easy return. We will invest even more in data science, Internet of Things, telematics and design, with the strengthening of the technology teams and the use of the agile methodology. Combined, the companies will have even greater capacity to leverage their technological platforms to develop scalable solutions, which will bring efficiency in costs, productivity, a positive impact to our customers' experience. About the next slide, on Page 7, we show the products that are already offered by the companies as a result of their strategies to focus on the needs of their customers. Together, we will be able to offer the largest product platform from a single individual customer to large corporate accounts of different sizes and sectors of the economy, including specialized solutions in agribusiness and special vehicles, like commercial vehicles and even trucks. In order to improve the experience, loyalty and retention of our customers, we were also the pioneers in the development of several multichannel digital solutions, which places the combined company in a prominent position in technological innovations in the world. Luis, go ahead on the next slide.