Log-In Logística Intermodal S.A. (LOGN3) Earnings Call Transcript & Summary

Good day, everyone. Welcome to Log-In Logistica Intermodal conference call to discuss fourth quarter and 2021 results. My name is Julia Ornellas. I'm Log-In's Investor Relations Specialist, and I will be your hostess during this event. The presentation and comments about the company's results will be made by Log-In's CEO, Marcio Arany; our CFO and IRO, Pascoal Gomes; our Customer Service Officer, Felipe Gurgel; and our Terminals Officer, Ilson Hulle. They will comment on the company's performance and main highlights of the quarter and the year. Then they will be available to answer questions that you might have. The slide presentation and earnings release in both Portuguese and English are available in the Results Center of the company's website, but we will be showing the presentation in Portuguese here on Zoom. In addition to the rooms available in Portuguese and English, we will also provide Brazilian sign language interpreting during the whole event. All participants will be listen-only mode during the company's presentation. Later, there will be a question-and-answer session, when further instructions to participate will be provided. Be advised that this webinar is being recorded and will be available also on the company's website. Before proceeding, as usual, let me mention that forward-looking statements that might be made during this conference call relative to Log-In's business perspectives, projections and operating and financial goals are based on the beliefs and assumptions of Log-In's management and on information currently available to the company. Forward-looking statements are not a guarantee of performance. They involve risks, uncertainties and assumptions, and therefore, depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of Log-In and could cause results to differ materially from those expressed in such forward-looking statements. Now with the legal disclaimers made, I'd like to turn the floor to Marcio Arany, Log-In's CEO, to start with his initial remarks.

Thank you, Julia. Good day to all. I'm Marcio Arany, CEO of the company. I would like to thank everyone for joining us on this conference call to review fourth quarter and full year 2021 results of Log-In Logistica Intermodal. We will start the presentation on Slide 3, please. Going over the main achievements of our strategic plan, then we'll move to the presentation of our earnings. Our actions and strategies are structured in 4 pillars: coastal shipping terminals, logistics solutions, capital structure and corporate management. In our coastal shipping business, we highlight historical annual NOR since the beginning of the operation, historical annual EBITDA record, the 2020 Electrolux award, greater utilization of our Log-Ai platform by our customers. In TVV and in logistics solutions, 3PL, we highlight historical records for annual EBITDA and NOR at the terminal, the highest container handling volume for general cargo since 2012 and completion of the first phase of the TVV expansion project. Regarding our capital structure pillar, we had the approval of the fourth issue of debentures, BRL 340 million, implementation of hedge accounting, full settlement of the first issue of TVV debentures and the early supplement of the second issue of Log-In debentures. In the corporate management strategy pillar, the fourth and last point, we highlight the supplement of the tender offer with MSC now holding 67% of the company shares. In this case, it was a subsequent event. We also signed a sales and purchase agreement for the acquisition of Tecmar Transportes. And the fact that Log-In obtained the GPTW Brazil certification as a great place to work in addition to other initiatives in our sustainability plan. Now our team will be presenting our fourth quarter and full year results, starting with our CFO, Pascoal Gomes.

Thank you, Marcio. Good day, everyone. Thank you for joining us on this conference call to discuss our earnings. Well, let's start with the highlights for 2021. We had an excellent year for Log-In, a year of strong and robust and consistent growth, starting with our net revenue that grew 24% over 2020, reaching almost BRL 1.4 billion. Our EBIT showed strong growth, 18.2%, totaling BRL 365.6 million. And the margin dropped just a little. I'll take this moment to explain a reduction of EBITDA and EBITDA margin in Q4 of this year stemmed from some business effects, such as a greater share of our Feeder and Mercosur service lanes which on average have a lower contribution margin compared to cabotage, although the contribution margin is excellent. Just like an increase in general cargo, which was quite relevant at TVV. And it also has a lower contribution margin compared to container handling. Coupled with that, we had some nonrecurring positive events in Q4 2020 and other negative nonrecurring events in Q4 2021, which I will detail in the next slide. But our net revenue in the quarter posted a super strong performance growing more than 20% and reaching almost BRL 400 million. Other than that, another business effect, which helps explain this reduction in EBITDA margin, particularly in Q4 '21, was an increase in our vehicle transportation operation, what we call Ro-Ro operation, which has a much lower margin compared to other business lines of Log-In. On the next slide we can see very strong growth in both net revenue of the company, growing 24% when we compare with 2020 and living behind the Q4 2020 line, which was a pre-pandemic quarter. We highlight that the growth was more than 46%. EBITDA grew 18% over 2020, and we can see that there is an increasing trend of EBITDA results along the quarters. Last quarter, again, there were some nonrecurring events justifying the slight drop quarter-on-quarter. And the EBITDA margin particularly with resumption of Ro-Ro business also dropped a little in Q4 of this year. But I think that the great good news here is that not only did we leave the results of the pre-pandemic period behind, but even after the pandemic, we posted consistent results. Now moving to the next slide. Here, we bring you the performance of the company's share from January 2019 before the follow-on, which was done in the end of 2019. We can see the variation of our share performance, LOGN3 compared with the main Brazilian Stock Exchange index Ibovespa. It is clear that just a follow-on when we committed to the market to deliver a strategy, that was agreed upon with the market at the time. Since then, our shares had peaks and troughs from BRL 11 to BRL 20 approximately. We had BRL 20.23 share price after the follow on, then there was a reduction with the pandemic, reaching a trough level of about BRL 11. And even before, we received the SAS/MSC letter for acquisition of a control shareholding, we had that stock price. Before receiving the letter from SAS, we were trading close to BRL 15. The price of the tender offer offered by MSC at the time, ahead of premium, a relevant premium and the shares responded immediately, and the shares were trading between BRL 20 and BRL 23 approximately until we achieved BRL 25 at the tender offer. The tender offer was settled at BRL 25 per share. I'll speak more about that later. And after that, although there was a slight decline after the tender offer, then the shares performed really well, stabilizing at BRL 25, BRL 26. So I think the take-home message here is that we are detached from the Ibovespa index because Log-In has been performing really well and indeed did perform really well during the pandemic. Now moving to the next slide. The highlight here is a lower exchange rate variation, by virtue of a hedge account strategy adopted in March of this year. So an exchange rate variation that has no cash effect. It results from a dollar debt that we have with BNDES. Of course, we have lower exchange rate variation compared to last year, but this result contracted almost 30%, 29.7%, thus contributing to our bottom line. Our net income loss, where we posted the very best result of Log-In since we started operating in that income of approximately BRL 100 million, almost 7.5-fold that posted in 2020. So again, this quarter-on-quarter reduction that is being recorded by some of the media, that results from an exchange rate variation. Look at the first graph. We are BRL 43 million of positive exchange variation, again, with no cash effect compared with a negative exchange variation in the same quarter of this year of BRL 7 million. So here alone, we are talking about BRL 50 million in this variation. Not to mention approximately, BRL 25 million from the early supplement that we had of the second issue of debentures, which became expensive for a Log-In credit profile. So we decided to have an early payment of that debt, that's [ D-0 ]. And that pushed our financial result worse in debt in that case, but this is an nonrecurring effect, which justifies this quarter-on-quarter variation. I'm talking about BRL 133 million of profit that we posted in Q4 2020 compared with also a profit but of BRL 20 million that we posted in the same quarter, but of 2021. Now moving to the next slide. I will turn the floor to our Customer Service Officer, Felipe Gurgel. He is representing our commercial department. Thank you.

Thank you, Pascoal. As Pascoal mentioned, I'm representing our Commercial Officer of Coastal Shipping, Mauricio Alvarenga. Before I dive into our Q4 '21 highlights, I would like to point out that we achieved a very important record Mercosur coastal shipping in 2021. We had the highest volume of containers handles with 421,000 TEUs, 15% more than in 2020. We posted an NOR of just over BRL 1 billion in coastal shipping in the full year 2021, up 21.4% over 2020. We achieved an EBITDA of BRL 301.5 million, 11.4% higher than 2020. Not talking about the numbers of the fourth quarter of 2021 and over for the period was BRL 309 million, 18.7% up over the same period of the previous year with a highlight being the Feeder NOR which recorded a 43% increase. Another highlight was a 2% increase in volumes transported in Q4. However, this volume came at the different cargo mix compared to Q4 '20, having been leveraged by Feeder and Mercosur volume and a reduction in cabotage volume basically caused by the unscheduled maintenance stoppage of one of our vessels causing a loss of capacity in this quarter. In Ro-Ro vessel chartering, we posted a 35% revenue increase in the fourth quarter and a 59% revenue increase if compared to 2020. On the back of higher volume, mostly concentrated on Brazilian imports, in Q4 '21, the combination of proportionally a lower cabotage volume explained our operating capacity in container shipping and higher volume in the vehicle operations resulted in a coastal shipping EBITDA margin of 29.5%, 5 percentage points lower than in Q4 '20. And an EBITDA of BRL 91.3 million in line with the same period last year. Lastly, I would like to congratulate the entire Log-In team for the results achieved. 2021 was a year of great challenges with mainly many achievements, which demonstrate the resilience of our team. We ended the year very confident that we will have an even better year in 2022. Thank you for your attention, and I'll turn the conference over to Ilson Hulle, our Terminals Officer.

Thank you, Gurgel. Good day, everyone, attending this conference call once again. It is a pleasure to report our 2021 earnings referring TVV operation. Terminal Vila Velha. We'll go over some highlights for the year and for Q4 and then detail some highlights mentioned by Marcio Arany at the beginning of the presentation. Just I would like to touch upon net revenues. In the last quarter, net revenues totaled BRL 69 million. And with this, we ended 2021 with total revenues of BRL 265 million. We grew up 34% over 2020. So this was the very best year in TVV's history in terms of revenue since we started operation. Q4 EBITDA totaled BRL 28 million. And we ended the year delivering an EBITDA of BRL 119 million, again a historical achievement for this operation. From the financial point of view, we grew 22% when compared to 2020 of historical achievement, a historical feat for this operation. Now talking about volumes handled in the terminal container. Volumes despite a reduction in the last quarter of last year ended the year with a 4% growth with 174,000 containers -- 184,000 containers, the very best result for container handling. And in terms of general cargo, we had a surprising result 250,000 tons, almost a 120% more year-over-year and 811,000 tons of almost 60% in volume of general cargo. To detail volume a little bit, well, we had a positive year in exports to the United States, into Europe of mobile, granite and coffee. Coffee did face some challenges regarding the weather along the second half of the year, and then cost volumes to be below record levels, but granite volumes were very, very strong. In general cargo, we have a new product mix at TVV. For a couple of years now, we've been trying to diversify our operation, trying to be more aggressive in the general cargo business. And in Q4, we were able to sign new contracts, particularly for operations like steel and bulk. And then financially offset our results. This was a strategy that we began 2 years ago and which is giving the right fruits now when we balance our business at TVV from the financial standpoint. So these were the highlights. And I also wanted to mention the completion of Phase 1 of our expansion project, but I will speak more about that later. I turn the floor back to Pascoal.

Thank you, Ilson. Now moving to Slide 10. Talking about indebtedness. The main highlight here is the level of leverage, which is stable at 2.4x net debt over EBITDA ratio. This remains at stable levels. Although the gross debt of the company did increase, we took on an incentive and long-term debt to finance the TVV capacity expansion project, which Ilson mentioned very quickly a moment ago and which he will explain in more detail later regarding equipment that we are acquiring, and that is being financed with this capital. Still, our cash position also increased. If we compare Q4 with Q3, we have almost BRL 50 million variation. And our EBITDA is stable in the last 12 months. So we have a slight increase in gross debt, that explains the slight variation in leverage. Other than that, we had an early payment, as I mentioned, in debenture issue, which was expensive for again, considering the current rating credit of the company. Additionally, our debt is in its majority, a long-term debt. As we can see, we still have a relevant portion of that with BNDES and other commercial banks accounting for 44% of our debt. And the profile is very balanced in terms of indexes. In terms of the amortization schedule, we show since first quarter 2021, we were able to extend our debt. We paid a truckload of debt that was going to mature by 2023, approximately BRL 270 million. That gave us more momentum to service this debt amortization schedule in the coming years more towards the long term. Moving to the next slide. I would like to highlight the voluntary public offering for the acquisition of the control of Log-In launched by SAS, a wholly owned subsidiary of MSC. So after a series of steps and requirements in line with the Brazilian regulation mainly from CVM and CADE, the Brazilian antitrust agency. Last January, the tender offer was carried out and settled. And in February, we had an extraordinary shareholders meeting to elect 3 new members for our Board of Directors, members appointed by MSC. Still as a result of the tender offer, we had almost 91% of the Log-In capital stock qualified, the shares that were acquired by SAS/MSC with 67% of our shares as this closed, and this was the cap for their acquisition at a unit price of BRL 25 per share. Since we had qualifying more than 67%, we have an apportionment as you can see on the bottom of the slide of 73.82%. So this is already a reality. We know that CADE is still looking into this to get the final verdict and greenlight, but MSC is already participating in the company's management through the Board of Directors. Moving to the next slide. I turn the floor back to Ilson Hulle to speak a little about the new equipment we acquired.

Thank you, Pascoal. Yes, I just want to give you an update on the completion of Phase 1 of TVV expansion plan. And to recap what happened in 2020, we renewed our concession for another 25 years with the Ministry of Infrastructure. And with the concession renewal, we took on commitments to invest in our terminal. At the time, we would invest around BRL 82 million. But with the current dollar rate and the current price of equipment, we are talking about an updated investment of approximately BRL 130 million. Phase 1 of the project has just been completed. The project has 2 steps, 2 phases, practically 2 years of investments. The first part and the most relevant investment was for the acquisition of 2 new mobile harbor cranes that we call MHC. We made a decision to buy from [ labor ] in Germany. They are considered the best manufacturers of this kind of equipment in the world. While the equipment arrived at TVV in December, and they started operating in December. We also included a QR code on the slide. So if you point your camera, you are going to be taken to a YouTube video that shows the level of the equipment at TVV, real footage and some operations already handled by that equipment. Now that equipment changes the look and feel of TVV because we truly become a multi-purpose terminal in addition to operationalizing and our operating containers loading and unloading vessels. The MHC can operate for general cargo, bulk project cargo and particularly with a greater lifting capacity. It's a very high lifting capacity. We didn't have that in that region of the country. It's one of the cranes have a lifting capacity of 154 tons. And we also acquired an additional technology. [indiscernible] these 2 pieces of equipment into [ connect ] and we can have a combined operation of up to 300 tons of lifting capacity for highly heavy cargo. So TVV actually becomes a lot more competitive and a lot more open to other types of projects and cargo. And I am sure that this will bring to Espirito Santo then region of the country where we operate a new capacity. Since January, some vessels have been operationalized. Some special cargo have been handled and we're bringing to the state and to the region, new logistics projects because of the new equipment we acquired. While the project continues, we are moving on to Phase 2, which is expected to end by year-end or beginning of next year. And again, I will give you an update on that as we move along the project. I turn the floor back to Gurgel to speak a little about our customer experience.

Thank you, Ilson. Well, on this slide, we would like to highlight some of the results achieved with our strategic customer centricity agenda, which is one of the levers for our growth plan. We developed the Jeito Log-In de Encantar or Log-In's way to delight, which groups 24 projects focused on customer centricity in coastal shipping and another 32 projects in TVV. Some of them also directly linked to our ESG agenda. These projects are supported by 5 pillars: culture, people, processes, technology and suppliers. With the evolution of these projects, we can already notice greater loyalty from our customers and positive impacts on some indicators. One of them is NPS, net promoter score. In 2021, we conducted 4 surveys ending the year with TVV reaching the quality zone above 50 points. In coastal shipping, very close to the same quality zone presenting stability in the level of customer perception throughout the year. Another highlight is the use of our platform, Log-Ai, which went live in March 2021 and ended the year with more than half of the bookings for spacing, our vessels being made through it, which shows that creating this additional service channel was a wise strategy. Our road punctuality indicator also reached the record mark, closing the year with more than 95% of our 85,000 operations arriving on time in relation to the times scheduled by our customers. We'd also -- I would also highlight unprecedented 0 cargo theft rate in our operations, reinforcing the thesis that cabotage is a very safe transport mode for our customers. And lastly, in 2021, we received 2 important awards: Best carrier award for cabotage, and also best carrier award for innovation in the service model. Awards granted by 2 of our main customers. With that, I turn the floor back to Pascoal.

All right. With this slide, we want to show you some nonrecurring effects of our results starting with EBITDA, in Q4 2020, when we posted BRL 104.5 million. Then we have a total year accounting effect, reclassification, which increased the result in that quarter by BRL 5.4 million, referring to the TVV leasing contract. This is called [ DF116 ]. Our contract was classified differently before. And we got the whole results for the year, and we restated at that moment of the year. So that impacted the result, but it is nonrecurring. So the consolidated Q4 '20 EBITDA, totally managerial, it's a disclaimer of BRL 99.1 million. Comparing this EBITDA with EBITDA of Q4 2021, they would be aligned, BRL 99.1 million compared with BRL 99.2 million. And there is a margin between net operating revenue and in costs and expenses, so with a positive variation of AFRMM. We've been increasing the number of our own vessels in the fleet and the cabotage revenue, generally more AFRMM. But again, in Q4 2021, we had 2 nonrecurring events, which were important, resulting from the same fact which was a stoppage of one of our vessels, Log-In Jatoba. We incurred costs with insurance related to the technical problem of around BRL 7.3 million, plus BRL 3 million of running costs. In other words, a vessel stopping has the fixed cost still running and consuming results. So that adds another BRL 10 million. And with this, we have a consolidated managerial EBITDA of BRL 109.4 million, almost 10% better and higher than the consolidated -- on the consolidated EBITDA of Q4 '20. Since the even net of these nonrecurring effects in this managerial analysis, we post a significant growth of our operations very well. With that, I will turn the floor back to Marcio Arany, our CEO.

Well, thank you, Pascoal, Ilson and Gurgel. We will now begin the Q&A session. We are available. Thank you very much.

[Operator Instructions] We have a question by [ Camila Silva ].

How will [ Cardoso ] privatization impact Log-In operations?

Thank you, [ Camila ]. I will ask Ilson to answer your question.

Thank you, [ Camila ]. [ Cardoso ] should be the first port authority in Brazil to be privatized since the beginning of the project by the Ministry of Infrastructure. Because we are the main leasing player of that public port, we've been following the topic up close analyzing possible impacts on our business, particularly at TVV. So we understood the process. We reviewed the process up close. We reviewed in depth all of the documents disclosed and in the invitation to bid. And we made the decision of not bidding in the process. Log-In does not have the interest in acquiring the port authority. We are port operators, in our business is not to be a port authority. That's not our core business. But we were approached by some of the interested parties because they wanted to understand the functioning of the port, the functionalities of the port. And what I can tell you is that along this process, we were able to remove a lot of items that could hurt our business. The federal government was, I should say, very smart in protecting the current contracts, and we saw that as a very positive decision. So the TVV contract is 100% guaranteed for the next 25 years. We just renewed the leasing contract. And that applies to the financial clauses and all of the provisions. So there's no risk there. So when we realized that the contract was not a risk, we start seeing with optimism, the potential future advantages that we can derive from this process. Considering that the port is managed by a state-owned company. When that moves to the private sector, we expect that processes will be more agile, but the dredging process, for example, will truly happen, that it will be possible to increase the densification of some areas. Because today, this practically does not exist in the current conditions of the Port of Vitoria. So we have very positive expectations regarding this auction that will take place in March 30. And as soon as we know the winning bidder, we want to build a very positive and prosperous relationship for the Port of Vitoria, not only for Log-In and TVV, but for the whole Espirito Santo part community. We think that Log-In have a lot to contribute to the Port of Vitoria to the region where we operate. And we want to contribute with projects and investments, and we are very optimistic. And looking forward to see who is going to be the winner of the bid.

We have 2 questions by [ Daniel Oliveira ] in the Q&A. The first one. Log-In mentioned the acquisition of new vessels to be delivered by 2024. Now with the new rules of [ BRF DC ], will this change the rules for chartering and acquisition of new vessels? That's the first question. And second question, given the current characteristics of coastal shipping, what profile of vessels is Log-In looking for? And what kind of types of cargoes and technology?

Who asked the questions, Julia?

[ Daniel Oliveira ].

[ Daniel ], thank you for your questions. Well, Log-In as a company, it believes in Brazil in coastal shipping cabotage. With or without [ BRF DC ], we would make the necessary investments to continue to grow -- to convert cargo to a more sustainable mode of transportation. Now [ BRF DC ] helped in the sense that we can operate a vessel without the need to nationalize it. But the challenge to operate cabotage with Brazilian cruise continues. Regarding the size of the vessel, I think that today, we already have vessels very appropriate for our reality. These 2 new vessels that are being built will have a capacity that is 20%, 30% higher of useful capacity compared to the current fleet of vessels, and they will consume less fuel. So these are super adapted vessels in terms of time in the sea, time at the port for Brazilian cabotage. So we intend to continue to make acquisitions with that profile of vessels that we consider to be adequate.

We have a question by Pedro Pimenta from Eleven Financial with his hand raised to ask a question live. Pedro, we will enable your mic, and then you can ask a question live.

If you could comment and give us an overview of 2022 in terms of cost because in the results, we saw cost increase with personnel, with chartering, nonrecurring effects with the stoppage of vessels and docking operations. So if you could comment on these nonrecurring events? And excluding fuel cost increase, what could we expect for the first quarter of 2022? And can we expect a higher EBITDA margin compared to Q4 2021?

All right. Thank you, Pedro, for the questions. So speaking a little about costs for 2022. Our main cost is 2 vessels to be docked still in 2022 for classification reasons. That's the first point. And the second point that you mentioned is bunker fuel. Bunker is an important cost increase driver. And that is impairing our detachment from our main competitor, which is road transportation. However, we have a surcharge with the market that regulates this kind of increase. That regulates increase or decrease in bunker prices depending on price fluctuations, but that is a point of concern. Log-In Jatoba as Gurgel mentioned, started operating again. But in the beginning of January, it did have -- should they'd have some restrictions, she was being repaired. But in terms of the margin, we are still with our goal of continuously increasing our margin in cabotage. Our main growth driver is new cargo that requires more service, more technology. And that's why we're making more investments. These are, I should say, more demanding cargo, and this is what we want to bring to our business more and more. Now there is some margin decrease that you could see, for example, at TVV and in cabotage. But these margins are excellent. It doesn't mean that the service is degrading. It means that we're actually growing new cargo. The more TVV develops as a multi-purpose terminal, the more it will bring cargo that pays less, but that contributes a lot to the terminal. And the TVV team is doing brilliant work. They're increasing the operating capacity of container ships. We're leasing more room to operate other cargoes. They don't compete with each other. And the same happens with cabotage coastal shipping. When we talk about Feeder cargo, Mercosur cargo, and when we say that the contribution margin is lower, well, they don't compete for the same space. Mercosur cargo is done primarily through Santos and Santa Catarina and then we ship -- we load the cabotage cargo. So candidly, looking at the number, it can give you some concern, but actually no because the numbers are very positive, and they are part of our strategy to increase the occupancy of the terminal with new cargo without hurting the container business and cabotage.

We have a question by [ Arthur Sampaio ].

Firstly, congratulations on an excellent year. Could you explain the CADE process in more detail, please?

Thank you, [ Arthur. ] I'll ask Pascoal to explain the process.

Thank you for the question. Well, CADE is going through their normal process. I think then a different element in this innovative process. It's actually the first time that CADE is analyzing this kind of business was that they gave us a prior authorization before their final decision. So that SAS/MSC would go forward with a tender offer with a clear objective of preserving the value of the company. In other words, there was alignment between MSC and its representatives in Brazil and CADE. Also, one of the Board members that we elected out of the 3 new ones is like a monitor of CADE because to ensure that MSC will not participate in any kind of deliberation, they can generate a conflict from the competition standpoint before the final verdict by CADE. So CADE is still asking for some information for their final decision. It's a regular process. We cannot really estimate how long it will take. We all know that CADE does work with some deadlines or deadlines that they set for themselves to solve the acts that they have to analyze. And we are still in that window. There is no guarantee that the final decision will happen within this window of assessment, which is something that CADE sets for themselves. Now what are we doing as a company? Well, we are helping them in the whole process, providing information, providing everything we know about Log-In, about the market as a whole. Regarding the coastal shipping business, TVV, our intermodal approaches. So we are constantly putting together material to submit to CADE.

I have another question also posted by [ Arthur Sampaio ]. What is the expected improvement in operating leverage with the resumption of industrial production in Brazil? What previous proxies would be interesting to monitor?

Thank you, [ Arthur, ] for the question. Pascoal, go ahead, you can answer that.

Operating leverage, [ Arthur ], I'm trying -- I think that with your question, you're asking about our capacity with fixed costs and our capacity to improve revenue over time. And what would be our expectation regarding improving that looking forward? Okay. You all know that in terms of economic growth, in general environment, vertical economic environment, 2021 was a complicated year. But for 2022, we have some expectation of growth. That Log-In -- when we look at Log-In's growth, there's always a growth driver linked to the country's growth in terms of increasing cargo transportation in general. But more importantly, more important than Log-In growing linked to the economy growing. Cabotage, not with the incentives that come with [ BRF DC ], more towards the mid- to long term. Cabotage has a lot of room for growth. Cabotage has been growing at 2-digit rates in the last 5 years. We still have -- it still has a small share of our transportation matrix. It accounts for around 6% when we talk about cabotage container transportation. In a country where the road transportation mode is by far the biggest, it accounts for 60% of our transportation matrix. 60% of our cargo is transported on roads and highways. So we have an important job here to convert road cargo to cabotage cargo. This is at the core of our strategy. And sometimes, that makes Log-In's result to detach from the average result of the market. Also considering potential economic growth of Brazil, they can also benefit our operation. So we are delivering a number of actions to help us perform and execute on this strategy. So when you talk about indicators, industrial production, all of that is important in the industry and commerce, of course, are very important for our business. But again, we are being driven by our potential growth drivers internally.

We have another question in the Q&A. It's an anonymous question. What are the main changes at the company after the relevant share of MSC and relevant participation of MSC at the Board? And congratulations for the excellent results of Log-In.

Well, thank you for the congratulations. Well, I think then Pascoal was very clear about this. The main change that we had was the election of 3 Board members, and this was very recent. We haven't dealt with them so much yet because the CADE process is not so fully finalized. It's well underway, but it hasn't come to an end yet. But we do have some expectations. Well, they are the largest ship owner worldwide. They know a lot about shipping. They have an expertise. They can help us in many, many ways. There are a lot of good things that can come out of that because the larger ship builder in Brazil is your shareholder. But we have many other shareholders. And we will treat them as we have always done. But I think that MSC can bring us new business, some interesting things. We haven't got any information from them yet. We don't know exactly what they are thinking and what they are planning for Log-In because we're still waiting for a final decision by CADE. On our end, we have very high expectations.

We have a question by Pedro Nogueira. What is the expectation and what are the objectives with the acquisition of Tecmar?

Pedro, thank you for the question. Well, it's part of our strategic plan. And one of the visions for the cabotage business is to get into the fractional cargo business. Tecmar, 80% of what they do is fractional cargo. [ Experts ] of the cargo. They have an expertise in this area. We are not experts. So we want to drink from their fountain and enjoy that synergy. As Gurgel mentioned, we have 85,000 trips hired [ per year ] to have a door-to-door delivery. And they master this kind of road transportation. So we expect to derive some synergy with them in these 2 areas, in terms of our door-to-door cargo delivery and to add value to our customers with parceled cargo in cabotage.

Well, there are no more questions. So I would like to thank all of you for participating, and I'd like to turn the floor to Marcio Arany for his final statements.

Very well. To end, you could see a series of spectacular results that we had along 2021. Our business is vigorous and fully aligned with our long-term growth strategy. We have been aligning all Log-In teams in that direction. And more and more, we want to be positioned as a company that offers logistics solutions to our customers. Another important point raised by Gurgel is that we now place the customer at the center of our activities. It's not just a commercial team that classically looks at customers in more detail. The whole Log-In now is moving in the direction of customer centricity in coastal shipping, cabotage and TVV. And you could see the results, high NPS and the evolution of cabotage. And this is definitely going to consolidate Log-In as an outstanding provider of logistics services. And lastly, I want to thank all of you for attending this conference call. Thank you very much, and have a good day.

Thank you. The conference call of Log-In Logistica Intermodal to discuss fourth quarter and full year 2021 results is ended. You may disconnect and have an excellent day.