MAHLE Metal Leve S.A. ($LEVE3)

Good morning, ladies and gentlemen. Welcome to the MAHLE Metal Leve video conference to discuss the results for the fourth quarter and full year of 2025. This video conference is being recorded, and the replay will be available on the company's IR website. The presentation is also available for download. [Operator Instructions] Before proceeding, we would like to underscore that forward-looking statements are based on the beliefs and assumptions of MAHLE Metal Leve's management and on the information currently available to the company. These statements may involve risks and uncertainties as they relate to future events and therefore, depend on circumstances that may or may not occur. Investors, analysts and general public should take into account that events related to the macroeconomic environment, the industry and the other factors cause actual results to differ materially from those expressed in such forward-looking statements. Today in this video conference, we have Mr. Claudio Braga, CFO; and Mr. Daniel Brasil Alves, Marketing and Corporate Communication Manager. I would now like to turn the floor over to Mr. Claudio, who will begin the presentation. Claudio, you may proceed.

Good afternoon to everyone. Thank you, Rodrigo. It is a pleasure to be here with you once again. This information has become public since yesterday, and I believe that most of you have been able to see this. This was a year of success by and large. Here, you will see our results in the presentation, approaching the tariffs of the United States, all the impact that the acquisition cost and the operational market. performance. Our agenda is -- follows the same MO as the other presentations. There are highlights and Daniel and I will comment on this. Daniel afterwards will give you a general overview of the market, and he will talk about the performance of the revenue. He will hand it back to me so that we can elaborate financial data. And at the end, during the conclusion, we will have a Q&A session. As in the past quarters, Daniel and myself here are coordinating the presentation. Highlights on my side, well, we ended the year with a net operating revenue of BRL 5.4 billion. Daniel will elaborate and give you details. Here, we include the full year of the acquisitions of the Compressors, the acquisition, a minority acquisition of Arco is not part of the revenue. It's still considered investment. We will elaborate a little bit more on this fact. We ended the year with a gross margin of 27%, an EBITDA margin of 17%, EBITDA margin of 19%. Here, we have JCP that was approved during the November Board meeting and was paid out to the shareholders in December. Plus the difference of JCP regarding the result of the past quarter that will be payout in May. Now still talking about JCP, perhaps a number of you paid attention to the difference in social contribution and income tax of the last quarter due to the JCP of the last quarter, the IOC approved. Now Daniel has the floor.

Thank you, Claudio. Good morning to everyone. Thank you for participating on our video conference call. On Q4 of 2025 and full year of 2025, a first highlight, the Brazilian government launched MOVER Brasil with BRL 10 billion in lower interest credit to stimulate truck sales until May. Until the moment, BRL 5 billion have been used. It benefited because it stopped the drop. If we see the second semester of last year and during Q4, mainly there was a significant drop in the heavy truck market, and this program is here to contribute, and we've seen an increase of demand of heavy vehicles and in our revenue regarding the segment. Now this program can also be used as a future base for a future fleet renovation. And perhaps this may be postponed and can be used as the base to help us in this market. The second highlight, the U.S. Supreme Court judges on 20 February '26 that the fee of reciprocal tariffs was unconstitutional. On 24th of February 2026, a new tariff of 10% was established based on Section 122. We do have customers and over 95% of these customers that felt the effect. So we have a timing to receive this value, but this offset was negotiated in 2025, and we reached an agreement with our customers to compensate these values. Three, here, we have the energy efficiency rules in the MOVER program that were published with the CO2 target emissions from the wheel to well. And all EM tax incentives will be based on fleet emissions for vehicles sold between October '26 and September 2027. There may be an IPI additional discount of 1 or 2 percentage points, depending on what the company sees in terms of improvement, it could be 6% or 12%. Now four, the Euro Mercosur agreement is under legal review by the European Parliament and a provisional application is scheduled for May '26. Here in Brazil, it was approved on March 4 in the Senate. And today, the National Congress will have a meeting to approve and to be ratified by the President. Probably in May of 2026, this agreement will become under effect because there are rules regarding vehicles and parts. This will be a gradual implementation, and we are seeing the opportunities and the risk to mitigate them and to see the opportunities that can be created between Europe and Mercosur. Last highlight, Toyota announced the creation of a biofuel center in Brazil based in Sorocaba and will be focused on ethanol. This is for hybrid vehicles, and we -- and also biomethane and renewable hydrogen. MAHLE defined the tech center of Jundiaí as a global center of biomobility in the region, and this is a global biomobility center in Jundiaí. The next slide. Now with a market overview when we see sales and production between Brazil and Argentina and also North America and Europe production. Here, we have full 2025 vis-a-vis '24 light vehicles, there was a growth of 2.6%, reaching 2.5 million vehicles in Argentina, growth of 42.6% with 586,000 units, almost 600,000. This is significant for the Argentine market. Total Brazil and Argentina, 3.14 million vehicles. So this was good in terms of light vehicle sales, although there were movements that could have stopped us. Now in heavy, minus 6.7% in Argentina, growth of 43.4%. Part of the Argentine economy contributed for heavy and light vehicles. It was good for the automobile segment, totaling the year with a drop of minus 2.2% in heavy vehicles. Now the production of light vehicles, a growth in Brazil of 4.5%, almost 2.5 million vehicles, Argentina drop of 3.1 million with 491,000 units. Brazil plus Argentina, you can see 2.9 million vehicles and 3.2% in growth. Here, you can see that heavy -- this was due to the increase of imports of vehicles. We have the Chinese automobile industries gaining momentum and the location and the installation of these plants is slower than the sales. So the trend of BYD, the other auto industries from China here in Brazil, there was a grab between production and sales in the light vehicle. Heavy-duty, a drop of 5.9%, especially the second semester, the last quarter was challenging. There was a significant drop in Argentina growth, 2.9% and ending with 9.3% and this generated the MOVER Brasil program to incentive the segment and to leverage the production of heavy-duty vehicles. Now the production of Europe and North America, the main destination of exports, light in Europe, a drop of 1.5%, in North America a drop of 1.3%. These 2 markets represent a drop of 1.4%, 32 million. Now heavy-duty, 6% drop in Europe and a drop of 25% in North America, totaling minus 16.5% in North America, economic uncertainties, high tariffs in addition to stocks and regulatory uncertainties. A review of the rules, this also brought the heavy-duty market to a halt and totaling with a drop of 16.5%. We are in the middle of March. So now I will show you what the market is like in 2026 and prospects for the full 2026 year in Brazil and Argentina light, there was a drop of 1%. Brazil, Argentina lost momentum and the expectation to end the year of light vehicles, 3.4%. This is a growth in heavy-duty, the bimester, a drop of 25%. There was -- in the bimester here, we have an inertia in order to see the sales of heavy vehicles. In Brazil, a drop of 30%, in Argentina, 0% going hand by hand, and this is why we have a drop of 25%. The expectation for the full year is a market between 0% and minus 1%. This is a market going side by side in heavy-duty vehicles, although there will be no significant growth in sales, at least we're at a level similar to sales in 2025. So we -- the prospects are the reduction of the Selic rate and this strongly impacts this segment. With the drop of the Selic rate, the trend is to improve the segment. Now light vehicles in the bimester, there was a drop of 12%, 8% in Brazil and [ 30% ] in Argentina and the prospects for 2026 is a growth of 3% or 4%, aligned with the growth of the sales that I mentioned between 3% and 4%. Heavy-duty vehicles, the production in the bimester dropped 19%, 21% in Brazil and in Argentina, a growth of 18%. The prospect of the full year in the production of heavy-duty vehicles is between 0% and 2%. We're talking about a slight growth in heavy-duty vehicle sales. Now when we see the export market, Europe and North America. Light vehicles in Europe, the prospect is 0%. The market will drop. In North America drop of 2%. In both markets, the prospect of minus 1%. We're talking about this effect. In heavy-duty, growth expected in Europe, 7% in Europe and North America, 7%. The resumption at least in the heavy-duty vehicles, which is important in exports. And here, we see a halt in the drop in a significant growth of 7%. The next slide. Now the net revenues performance, we have 2025, 2024, original equipment domestic 54% with BRL 2.14 billion. Withdrawing the effect of the acquisition, this would have increased 13.6%. We grew above the market. We see the growth of vehicle production that was lower than this index, and we gained market share mainly in pistons and automobile filters. Original equipment for export, a drop of 0.7%. Withdrawing the acquisition effect, this would have been 0%. The revenue would be similar to 2024 and '25. There was a gain in FX. There was FX positive effect as we saw mainly in the heavy-duty market, a significant drop, which limited the gains of the company. Regarding revenue, we did gain market share that allowed us not to decrease our revenue, but we were tied up in the export market. Now domestic aftermarket, a growth of 5.7%. When I withdraw the acquisition effect, this growth would have been 1.9%. Now when we talk about the domestic aftermarket, this encompasses our Limeira operations in our distribution center and that in Argentina. So both what I sell here in Brazil and in our unit in Argentina sales. In the Argentine market are within this domestic aftermarket line, so 5.7% or 1.9% when I discount the acquisition. When I break separate both markets, there's a significant growth in Brazil and in Argentina, a significant drop of 20%. So we were affected by the Argentine market. As we've seen in the past presentation, this market was open. MAHLE benefited itself in the past years when this was a closed market. And as the market receives more imports of components, there were price adjustments in the market, and this was reflected on the aftermarket revenue in Argentina. We have focused to gain more volume, more market share in order to recover ourselves and to have a positive contribution for revenue performance. Now aftermarket export, a growth of 4.8%. This would have been 28%. Now when we see domestic export, there was a growth of 5.5%, totaling BRL 2.06 billion. And without the acquisitions, the growth would have been 2.1%. Our revenue of BRL 5.4 billion, a growth of 18.6%. Without the acquisitions, the growth would have been 4.7%. We highlight you for total, there was an increase of revenue of 0.6%. When I eliminate the effect of the acquisitions, there would have been a slight drop of 1% in revenue. And as I mentioned, the heavy-duty market and domestic original equipment dropped in terms of revenue, which contributed to the drop in this quarter. Now regarding the increase of revenue for 2026 and in the future, we are focused on new product lines to expand them of the off-road segment for original equipment and the aftermarket equipment, we want to increase our market share. Incidentally, this year, we will participate in the Ario trade show. We will participate together aftermarket and original equipment. We have also focused to create new projects to increase the market share in the traditional lines. And in the new assembly lines, we want to increase our market share. In the aftermarket, we're developing new product lines. Therefore, the company has focused not only on acquisitions, but we want organic gain participating in new segments. We want new projects, and we want to develop new product lines in the aftermarket to increase and guarantee an increase in revenue in the upcoming years. I will hand it back to Claudio, and I will be available to answer questions at the end.

Now recapping a bit the past calls from Q1, Q3 of 2025. This was a surprising year for everyone. These surprises were negative and positive. Now regarding positive surprises, we have acquisitions. We have a slide where we explained in detail. It's not the success of the acquisitions. There were a couple of hiccups here. We had to readapt our prices in the aftermarket of Argentina because the market was opened. There was a lack of alignment, the exchange variation and the fluctuation of the dollar, the inflation increased disproportionately compared to the cost. Well, I believe that our greatest hiccup were the American tariffs. Daniel said that most of our customers are negotiating. We always approached the American tariffs, not as a temporary effect, but our concern has always to see the potential macro impact that fortunately did not take place. And I believe that during Q3, we talked about the inclusion of MAHLE Metal Leve product in a special clause within the American tariff laws where we received differentiated treatment, and this was a bit of a release for Q3 and Q4, the situation was normalized. And in February, as Daniel mentioned, this was considered unconstitutional, but the U.S. government put the 10%. As a recap of all the problems that we face, the readaptation of the aftermarket price in Argentina as a new reality. We have to see this as a stage where MAHLE dominated the market, and now we are adapting to other prices and recapping what we already mentioned in other past quarters, what happens in Argentina is a readaptation to market prices. In the -- this is what we practice in Brazil or Argentina. The Gardin plant will continue suffering the impact in Gardin, they did their homework. There was an operational rearrangement. And I don't know if you remember during the second semester, the disalignment of the orders because for the Limeira aftermarket where we increased the number of Chinese imports, this was really adapted. This is normal, but the impact continues impacting the year. By and large, when you compare the ends of the table, this is the financial report that you had access to. Our intention for the next quarter is that we will -- this will be necessary. This was because of the hyperinflation transparency. There was a great hyperinflation in '24. It dropped a bit in 2025. Here, you have the impact of the year being impacted by BRL 54 billion. This year, 2025, he corrects himself, BRL 90 million. Until the date, what we have followed inflation in 2026 will continue comparable to 2025. This is something that we will have to see its evolution in terms of politics and economics in Argentina. But my message, by and large, from the impacts in the year, there was nothing that surprised me that we had not detected beforehand or throughout the year of 2025. And by and large, if we exclude the IAS, this would be comparable result. There is a gross margin dropping from 30.8% to 28%. And this is explained by the problems in Limeira and Rafaela. And -- it's not very visible here, but I believe it will be clearer in the next slide. The impact of IR and social contribution in the IOC that was paid during the last semester and the result of the year paid out in May. What draws our attention, and you will see in some slides are the acquisitions. The acquisitions in my prospects, all of them were successful. The minority share in an AC unit company, Arco. Arco presented good results. So this is the -- we did a call option here, but we're still not controllers of the company. And even with the Compressor acquisitions in the result, we see a deviation in sales of 1.5% or 1.6% in our gross margin and in our EBITDA. Now SG&A line, this was mentioned because of the aftermarket and an increase in R&D expenses. We would like to remind you that in some entry lines, we have to pay attention in details and to read the reports and to see our auxiliary tables. When we see an increase in R&D, it's not an increase in cost. This is connected to our revenue. If you remember, these were the transference for the tech center in Jundiaí to the test, the filters sent to North America. And throughout 2025 mechanic Compressors that I believe that during the next quarter, we will give you more relevant information. This was a successful year. Another item that positively impacted our results that in the beginning, we signaled as bad news or a point to pay attention was the BMD warranty problem that we had with BMW motorcycles. In the beginning of 2024, we provisioned EUR 5 million of warranty. Some payments were paid out throughout 2025, but the main warranty were reversions. So MAHLE BMW analyzed in details the technical part and MAHLE was eliminated as the main cause of the problems. Today, the guarantee of BMW motorcycles, we have a balance of EUR 1.6 million compared to the EUR 5 million in the beginning, and there was a reversion of EUR 36 million in Q4 of 2025. There were other provision adjustments that positively impacted our results. These were symbolic adjustments, all of them according to the accounting norms, but risks that could happen. A probability of 50% are not materializing fully or don't even materialize themselves. If there are questions regarding this, we can analyze the quarter. Now what really draws our attention here would be income tax. It would be the impact of IOC that goes here from -- and everything is aligned here. And when we see this isolatedly during the last quarter, a point that is positive with IAS or effecting the effects of IAS 29, we have a gross margin with an increase of 3 percentage points of 26% vis-a-vis 23% and an EBITDA margin of 17.4% and so a change in result of 3 percentage points. Now the acquisitions like during the past quarters, this is a summary of our acquisitions recamping. Here, we have a project that was to commercialize Compressors, Jaguar plant, I believe that some of you have visited this plant and the acquisition of Arco Industry. So here, the valuation is public. If you see the information in our IR site, perhaps 1.5 years ago, the valuation and the revenue is performing above what's expected. There was an increase in revenue of almost 10%. So this is a positive return. And here, you can see why this was a successful acquisition. When we see the valuation of the point of comparison and the EBITDA, we increased here in a significant fashion for an increase in revenue in the valuation vis-a-vis '25, there was an impact on the EBIT of 3 percentage points. The result was positive. This generated cash. Our cash has also been impacted by the Compressor operation and the debt to pay the operation wasn't necessary to increase our indebtedness because of the cash generation from Compressors and MAHLE Metal Leve. And the ROIC with excellent performance. Now on the footnote here, there's a highlight. We performed the first call option of 2 possible call options in Arco. We started the Arco with a share of 33.3% and October -- during October last year, we increased our share to 49.9%. We still are not the controlling shareholders of the company. The Arco result will -- it's not part of this result, but I believe there will be a second call option to be discussed with the Board during the second semester of this year. But in the acquisition contract, which is also public, there is an option of a second call option, which starts in October this year. We end with a period of 7 years, and we can increase our share from 49% to 75% or even 100% of the company, but this is something that is still to be discussed. Now regarding the -- the financial net results, I will show you the lower chart. Some draw attention in a positive and negative way. I will start from the right to left leverage goes from 0.66 to 0.96. This is a considerable increase. And this is because of the 3 other columns, but a point to pay attention in 2025, basically, this was due to the indebtedness of the Athena project. Our leverage after indebtedness was about 1.1. So now we are 0.14% below. We anticipated before the acquisition, there was an increase of indebtedness. It wasn't as we projected in the beginning. And here, we have long-term funding, which is basically aligned. There was a drop of BRL 80 million that is not offset by the increase of short-term indebtedness. So we increased the indebtedness throughout the second semester. And there was a change to long to short term from the first semester to the second semester, I believe that the most important number is both of them. Here, BRL 867 million and BRL 947 million, we're talking about BRL 1.3 billion. Now at the end of 2025, these are levels basically of BRL 1.6 billion. Here, I need to draw your attention. I believe that everybody remembers the follow-on and the payout of super dividends and what we did in 2023. MAHLE Metal Leve during 2023 approved by Board and shareholders reversed all the reserves, and we distributed to our shareholders as dividends. The company did not have cash to do this and then this was a debt outside of the curve. This indebtedness of 2023, well, this -- the payment will be paid out during 2026 and the other 50% of 2027, the first payouts are being made now. So this increase of indebtedness, the trend is that will readapt itself throughout 2026 and will come close to reality. Well, it all will depend on the company's operation, a positive point that would be cash. It wasn't only an increase in indebtedness, there was a significant increase in cash in 2024. We ended with BRL 332 million and BRL 658 million in 2025. What's important to talk about net values of 2026 with an indebtedness would be BRL 955 million will be cash minus the 2 indebtedness lines vis-a-vis the indebtedness for the Compressor product. So here in reality, BRL 200 million below what we expected. Financial expenses. This can draw your attention. There was a significant drop in net interest and exchange variation. When I spoke about the follow-on and the dividend payout in 2023. Now we do -- this was backed by exports. But what affects us is not cash, it is exchange variation is what we see in this table. So basically, the payments that take place from March on. So as we receive exports, we will see basically immediate effect. As I receive my exports and I will pay my indebtedness throughout these 24 months. Now when we see cash flow, here, we go from accounting to banking. How we ended our cash in 2022, BRL 380 million and now BRL 615 million in 2025. Working capital was significant. It was almost BRL 600 million. Most of this because of the acquisition, there were -- there was amortization of effect of interest rate and principal. Most of this was accounting, wasn't cash. So due to its proportions, some of them are irrelevant and extremely positive cash generation. Here, this slide, well, here, we had a potential bad news where the American tariffs was -- caused fear. And I wanted to show you that regardless of macroeconomic oscillation, we continue to be an effective operational company. This company shows the transparency of cash generation of BRL 1 billion. We also disbursed the IOC taxes and CapEx investments. I believe that you will see this information, and it was public in the March Board meeting and was approved in the General Meeting of 2025, a CapEx approved of BRL 180 million. There was a depreciation of BRL 160 million in the financial statements, you will see this. And cash outflow, BRL 150 million. Now the disbursement because of the acquisitions, BRL 510 million. The acquisitions were performed of around BRL 800 million impacting our cash by BRL 510 million. Most of then paid by the cash generated by MAHLE Metal Leve and Compresors and more exchange variation, not very significant, ending the year with BRL 615 million. I believe that I bring the presentation to an end. I will hand it back over to Rodrigo to moderate our Q&A session. And Daniel and I will continue at your disposal. Thank you very much.

[Operator Instructions] The first question from Mr. Jonathan from JPMorgan.

I do have 2 questions. One regarding the tariffs. You've reached an agreement with most of your customers regarding the compensation for these paid tariffs. Could you elaborate what will this compensation involve because the customers were the ones that paid the amount? They had to absorb the price. So what is going to happen in the upcoming quarters? And what kind of tariffs will you have to pay now because it was 14%, 18%? But due to the U.S. court ruling, I believe that this has diminished. Now the MOVER benefits how much will you transfer in 2026? And there was a deferred part during the quarter. I know there was an IOC effect. Are there other credits here?

Okay. I think any of us can answer this question. To the first part regarding tariffs. The tariffs that you outlined between 14% and 16%, today, our tariff is around 12%. In impact, you are right. The impact of the tariff mostly is paid by the customer. There are points where we export and sometimes the impact is on us and then the commercial side negotiates this with the client. And this is what Daniel underscored. I believe that we've agreed and negotiated practically 95%. Some customers didn't have the right documentations and they show the documentation and they receive them next quarter. The effect on our results are visible in our figures and the cash will receive something from 2025. Yes, the effect is limiting. It depends on terms. What the customer does is automatic and what we collect in terms of taxes. Well, with the 12%, it is easier to define projects because 50% would be a limiting factor for exports. So now we believe that the scenario is more favorable unlocking projects that were not mentioned last year. Now we do have new projects that are part of our exports. The next question is MOVI or MOVER, which of the 2 programs? MOVER is the benefit for those that buy heavy-duty vehicles. These were BRL 10 billion, BRL 5 billion have been used. So this goes up until May. We believe that this program fulfilled its target. It is helping to sell the heavy-duty vehicles. The expectation of the year is not to see significant growth, but we could -- we stagnated the drop. And with the drop of the Selic because now we have the Iran war and this can delay the speed of the drop of the Selic, we do believe that we will see a more favorable second semester. And reminding you, we had a strong first semester in heavy-duty production. So our comparison base this year for heavy-duty vehicles will be strong. And probably the first semester, we will see negative values in the production of heavy-duty vehicles. But during the second semester, we will see the reversion, and we will see the volume stabilize itself. What we also expect is to have a definite program, something that is not provisional. We want to see if the government will have resources available. But yes, with this high Selic, there will be a need of an incentive to make this investment so that companies renew their fleet. Now the heavy-duty segment, we know we are not talking about slight variations. There are significant drops and resumptions, but we believe that the fleet owners will renew the fleet. This is a year of elections. So when we define the election, I believe some investments will be unlocked, which is important for the company. I don't know if we answered your question? And now MOVER. The result I think that MOVER, there was value. This was the company benefited by the MOVER program to invest in project. This was created to enable projects. So the company candidated to receive the MOVER resources in 2025. Now for 2026, this program is still underway. So MAHLE transferred projects in order to receive the benefits of MOVER, but this still has not been defined. There is an expectation of receiving something through the project. But MAHLE candidate, enabled itself to show the projects, and we're trying to see what they will define and how much they will provide to each company that is a candidate. So there was this.

Our next question from Mr. Gabriel Rezende from Itau BBA.

Just a follow-up regarding heavy-duty vehicles in Brazil. Daniel talked a lot about the market. I wanted to better understand how you see the inventory in the sector because at the end of year, there was a significant drop in the heavy-duty production. Do you believe that you will reestablish your inventory and there will be greater sales, perhaps with MOVER Brasil accelerating itself after February and March?

Gabriel, thank you for your question. As you mentioned, during Q4, the production was very low. December was low when we compare it to the rest of the year, we are already -- we are seeing a recovery in the heavy-duty assembly lines in terms of revenue because this delays the sales of the truck. So we've observed a recovery in the revenue. We do not imagine a significant growth in production by the end of the year. Let's see, we will recover or stop, but the heavy-duty vehicles work with lower inventory. Sometimes assembly line don't have inventories. We believe that the program was positive. We saw this. Now the assembly companies put the EDIs and they show us what they will acquire throughout the month. Therefore, we see the movement of this recovery or this -- or at least the drop stopped in the market, but we do not necessarily see a significant growth in the production throughout the year.

[indiscernible] is mentioning that there are 2 questions that we will answer after the call, and our answer will be directed to whoever may posed the question. Okay. I'm going to read [indiscernible] question. He says, what is the company's strategy to continue diversifying the revenue because we have a future of hybrid and pure electric vehicles? Will you do this making new products or through new acquisitions?

Renard, as it was mentioned, here, you are signaling a trend towards light vehicles. Yes, there has been an increase on EVs and hybrid vehicles have engine redundancy. Here, we have 3 hybrid vehicles. Light hybrids, we have the full hybrid, and we also have the plug-in hybrid. So the first light hybrid, this is helped by the combustion engine. So this is a different component that will help the combustion engine. Nonetheless, the other products of the company are used in this vehicle in this engine. In light hybrids, this will not impact the company. Yes, we will have to adapt parts. Perhaps you will need more specific material, but we already sell this. Now the other hybrid vehicles, full hybrid and plug-in, there is a redundance. We have the electric engine, the combustion engine. All the -- all our products will be present in hybrid vehicles. And we see we -- the hybrid vehicles are higher than EVs, especially when you're going to drive long distances. In 2035, the pure combustion engine will have the greatest market share with light hybrid and plug-in and full hybrid comes next. And we believe with the light vehicles, we believe that the Chinese automotive industries, we provide -- we supply products. We do have a redundancy of products for the combustion and MAHLE Metal Leve is part of the MAHLE Group. We are part of a global enterprise and abroad the hybrid fact and the electrification is more advanced, especially in Europe. The company globally has products for electric -- pure electric vehicles. The company in the region will also participate. We will have components that can be used and produced here by the Brazilian market. For this, we need volume. So this has to be a feasible investment. As the market increases, it makes sense for the company to make this investment for the payback of this investment. In the beginning, we will perhaps start working with imported products, but the greater share will be on light hybrids that work with combustion engines. And then here, we have plug-in and we work with off-road in the aftermarket because we want to participate in the segment that doesn't participate -- that doesn't have such a need for electrification. I don't know if I answered your question. But here, if we need to acquire companies, recently, we acquired the Athena project. This is on a radar acquisitions, development of new products, the use of the global technology that MAHLE has in the region and working on electrical vehicles. We see this as a trend and the company is preparing itself to participate in the new market dynamic as the Chinese automobile makers. Perhaps it will take some time for them to consolidate themselves in the region, but the company provides products to these companies and MAHLE in China supplies components to the Chinese automobile companies for their electric vehicles. And we've received visit, especially in our Jundiaí Tch center because -- and the company now is prepared to help these automobile industries with the expertise and also to provide components. I don't know if you have any questions or no, subsequently, you can talk to Luis so he can provide you more information. There's another question in our chat from Felipe. I want to better understand the question. Congratulations for your results. You had -- you presented interesting result. Athena, the acquisitions were paid out. In Arco, 49% has already paying out. Now we have 51% remaining. Regarding, I don't know, the result of the distribution of dividends for 2025, I believe that this publication will be made public. Recapping a bit and analyzing the year of 2025 and paying attention to the future without giving you any guidelines. It is necessary to remember that during 2025, the shareholders approved the recomposition of the reserves. So yes, this was -- there was a contribution for 2025. We have to wait for the general meeting and the general assembly meeting to see how we will allocate these dividends. But when we see cash generation and results for the upcoming years, I believe that Daniel explored how we can organically grow. It could be an increase of other portfolio embarking in other segments. But we are prospecting the market to see future acquisitions. We have nothing on our radar, but MAHLE Metal Leve is always open to potential acquisitions. Nothing that I can share now that I can disclose now. I don't know if I answered your question or if I didn't answer your question.

[Operator Instructions] Our Q&A session has come to an end. Now we would like to hand it over back to Mr. Claudio Braga for his final remarks.

Okay. At the end of the presentation, there is a QR code and the e-mail of our IR department. We continue at your disposal should you have further questions that were not clarified here. I would like to thank all of you for participating. And I am very anxious when we will discuss the results of Q1. I believe everyone here is very anxious to see what the developments will be like this year. Although we are positive, thank you very much for your participation. Rodrigo, thank you for moderating. And now I will mute it and hand it back to you.

The MAHLE Metal Leve conference call has come to an end. We thank all of you for your participation, and have a very good day. [Statements in English on this transcript were spoken by an interpreter present on the live call.]