Marcopolo S.A. ($POMO4)

Good morning, everyone. Welcome to Marcopolo's Conference Call to discuss the results for the First Quarter 2026. Today's presentation and remarks will be delivered by Mr. Andre Armaganija, CEO; Pablo Motta, CFO and Investor Relations Officer; and Eduardo Willrich, Legal and Investor Relations Manager. Please note that simultaneous interpretation is available on this call. [Operator Instructions] This conference is being recorded and will be made available on the company's Investor Relations website, ri.marcopolo.com.br, along with the presentation materials shared today. [Operator Instructions] Before we proceed, we would like to remind you that any forward-looking statements made during this call are based on Marcopolo's management's current beliefs and assumptions and on information currently available to the company. These statements involve risks and uncertainties as they relate to future events and therefore, depend on circumstances that may or may not occur. Investors, analysts and journalists should be aware that a number of factors related to the macroeconomic environment, the industry and other relevant conditions could cause actual results to differ from those in the forward-looking statements. We'll now begin the presentation by turning the floor over to Mr. Pablo Motta. Mr. Motta?

Good morning, everyone. We would like to thank everyone for joining Marcopolo's First Quarter 2026 Earnings Conference Call. Let's move to Slide 4, where we'll begin with the highlights. In the first quarter of '26, Marcopolo reported consolidated net revenue of BRL 1.65 billion with a strong contribution from our international operations, which totaled BRL 596 million, up 4.6% compared to the first quarter '25. Return on invested capital reached to 24.7%, while net income totaled BRL 264 million, an increase of 8.8% compared to the first quarter '25. Let's now move to the next slide. During the quarter, Marcopolo's production for the Brazilian market declined by 5.1%, while production for exports from Brazil increased by 7.2% and international operations had a decrease of 33.5%. First quarter '26 production was impacted by longer collective vacation periods in Brazil, which extended through January 19, '26 at 2 of our 3 plants in the country. As of March, we began to see a normalization in production levels. Let's go to the next slide. In the first quarter of '26, net revenue generated from operations in Brazil totaled approximately BRL 900 million or 54.4% of the total, while external operations, including exports and international operations per se reached BRL 755 million, accounting for the remaining 45.6% of revenues. Across segments, we saw a balanced distribution between Coach buses with great exposure to the Brazilian market exports and Argentina. And the City bus segment was more focused on deliveries in Brazil and Australia. During the quarter, Marcopolo Australia reported net revenue of BRL 372 million, an increase of 68% compared to the first quarter '25. Now let's move on to the next slide. Consolidated gross profit in 1Q '26 totaled BRL 373 million with gross margin of 22.6%. The decline in volumes and revenue explains the slight reduction in gross profit and gross margin during the quarter. EBITDA totaled BRL 304 million in the quarter with a margin of 18.4% compared to EBITDA of BRL 262 million, a margin of 15.6% in 1Q '25. In 1Q '26, EBITDA was positively impacted by a nonrecurring effect of about BRL 45 million related to the reversal of part of the warranty provision recorded by our Canadian affiliate, NFI. Excluding this nonrecurring effect, EBITDA and EBITDA margin would have been BRL 259.8 million and 15.57%, respectively. Consolidated net income in 1Q '26 was BRL 264 million with a margin of 16% compared to BRL 243 million, a margin of 14.5% in 1Q '25. Now I'll turn the call over to Andre, who will discuss the market environment and outlook for the remainder of the year.

Thanks, Pablo. Good morning, everyone. We'll start talking about the City, Coach buses that showed a retraction in volume with a better mix in the internal market in 1Q '26 with models of more added value gaining mix compared to '25. Based on our backlog, we see volume should grow as of the second quarter because of the natural seasonality of the segment. As for City buses, we started '26 a bit more challenging against the expectation we had for the year of higher growth in terms of pass-through of costs from operators, especially because of increasing diesel prices is gaining more and more relevance. For micro and Volare buses, Marcopolo delivered 564 micro and 170 Volare to the Caminho da Escola program in this quarter related to the beginning of '23. The Ministry of Health received 242 micro buses and in the Ministry of Health, deliveries should increase in the second quarter. Now we are going to the next slide. In international operations, we see a mixed performance in the beginning of '26. Hoping, as Pablo mentioned, starts to have exceptional results with expansion in revenue and profitability in the quarter based on a solid order backlog and a good mix. The expectation continues positive for our operation in Australia. Metalsur, we see a retraction of production and deliveries as we have already mentioned since the fourth quarter of '25. High interest rates reduced the appetite of clients and decelerate the wave of renewal that started in the fourth quarter '24. Polomex, we see a deterioration of the local market that suffers with the abrupt decline of sales and interest from renewals from clients in '25. A very small recovery is expected for '26 in specific quarters. Even with a drop in volume, MASA continues to evolve its results and have a better delivery mix. One of the main highlights for the beginning of the year was the recovery of operating results from New Flyer, which contributed to the results of the first quarter significantly. Let's go to the next slide. In a more challenging geopolitical and macroeconomic environment, we remain paying attention to the impacts of FX and the cost dynamics in our results. Our order backlog allows us to project an improvement compared to the first quarter, supported by the natural seasonality of our market and also the deliveries to the Ministry of Health and the renewal of orders under the Caminho da Escola program. Phase 13 bid in process of Caminho da Escola, we are pleased with the outcome, which qualifies us to deliver directly or indirectly up to 7,210 units, including 620 Volare units, 2,220 City buses and 4,370 micro buses. This represents a 97% market share in the program, a significant achievement, and I thank the team for that. Now we are going to move on to the Q&A session.

[Operator Instructions] Our first question comes from Gabriel Tinem from Santander.

My first question is for Coach buses. If you could talk a bit about the segment in this quarter, it seems that you had a slightly heavier mix compared to the last year? I would like to understand your projections for the next quarter and the remainder of the year and also the portfolio, your mix and if you really see an increase in appetite from operators. A second question more related to government orders from the Ministry of Health and Caminho da Escola that you were recently awarded with a 97% share. Could you talk a bit more about how this works with the competition of plants in Brazil, both for micro and also City buses?

Gabriel, thanks for your question. Starting with Coach buses. Indeed, we first have been talking about the need for fleet renewal, which is a topic that should foster new purchases and demand for the coming years. The average Brazilian fleet in Coach buses is very outdated. So that generates opportunities in renewal. What we saw last year was the sales of Coach buses starting with light buses, more buses and to heavier buses more towards double deck. So towards the year, we did see this movement going on.

[Operator Instructions]

Gabriel, moving on. And while Andre reconnect talking about the Coach bus segment. As Andre has mentioned, demand continues quite repressed in the segment. I believe operators indeed see the current moment as an opportunity given that the cost of airfares is even a more important issue in terms of price adjustments. So reflect of the war did impact the air segment even more than the bus segment, given the adjustments and increases in fuel prices. There is something that we still have to look into, which is the financing from the government. There is -- we see a higher demand for the fleet demand, especially because of high cost of FINAME, but now with the inclusion of buses, that can bring an opportunity for operators to make purchases at a better cost. This is important. This is a segment that, again, still needs to renew its fleet in a more material way. And the opportunity is that this can come true with a more reduced financial cost. As for the Caminho da Escola program and the orders from the Ministry of Health, again, going on -- continue what we said, we see that our planned capacity and this is something we mentioned before in City buses, we are delivering this year an actual number below our expectations with regards to fleet renewal in the segment. We do see a difficulty that operators are having to be able to pass through costs in their contracts and have better financial economic sustainability. And therefore, in this context, we are enjoying this possibility that is not being filled by City buses to provide for this need with the residual amount of Phase 12 of Caminho da Escola that we were awarded in the end of '25 and also with the Ministry of Health, since we have about 1,500 buses to deliver until the close of the first half of the year. So carrying on, considering everything that we mentioned before in terms of basing processes, we believe we are going to have an installed capacity that will enable us with not a recovery that was expected in City buses, but the possibility of recovering our planned capacity during the second quarter, and we have to await the segment to really recover along 2027 so that we can understand how we are going to deal with capacity. And at some point, we'll have to revisit the number of buses produced today. But in the installed capacity we have today, we believe the demand that is not being materialized in City buses is giving us room for a more structured production of buses to Caminho da Escola and the Ministry of Health.

Our next question comes from Lucas Marquiori from BTG Pactual.

I have 2 questions. Pablo, you did mention the Move Brasil program, financing incentives. Could you talk a bit about the characteristics of the financing? What are the conditions for operators to access credit and how more competitive it is compared to the financing -- credit lines we have in the market? Just to understand if there is a real move in demand. And second question is to understand your take on the beginning of this year, especially the export market to Argentina. There was an expectation of strong volumes for such market this year. And I would like to understand if that's a weakness on their side on the side of the Argentinian economy or if there is an FX impact reducing your competitiveness. So to understand the lower numbers for exports to Argentina.

Excellent questions, Lucas. Talking about Move Brasil. Move is a program that has an operational scenario at least very similar to FINAME credit lines. It's a line operated by the BNDES, providing resources to agents to help their clients with purchases. And the greatest thing here is competitiveness in terms of rates. Today, we are selling our products with a FINAME program of 19% to 21% a year in Move Brasil. And here, I'm talking about Phase 1, which is the phase that was exclusive for trucks. In Phase 2, the National Monetary Council is still to publish the standards. But thinking about the speech of the President and other ministers in the announcements, conditions should not be different, perhaps even better than Phase 1. At least that was our understanding of the government speech. In Phase 1, the financial cost for operators was between 13% to 14% a year. So a significant reduction of 7 to 8 percentage points in financial costs a year for the financing of new products. And if operators write off a bus with more than 20 years of use, they might have even further cost reductions, almost 1.5 percentage points below the 13%, 14% I mentioned. So that brings the level of financing costs to a much more competitive level than what we had so far. And I think another important point is the resources of BRL 21.2 billion in the whole line, encompassing buses, trucks and road equipment, BRL 2 billion exclusive for buses, which somehow enables customers to close their deals in the coming days. About Argentina, what we see is the following. The scenario in Argentina is a market recovery scenario. When we compare Argentina to the Brazilian scenario before the payout plan when Brazil had a major adjustment in economic policies. We see Argentina is having some monetary tax and FX stability, which is a good foundation to start delivering value in the mid-, long-term. So what we see is a credit scenario that is still very restrictive. This is also something we expected in a country that is starting to go back to see things in the mid-, long-term. Customers did have a significant renewal with their own resources. And along this quarter, interest rates are still high, but are moving to a more suitable level for customers to consider renew and local banks are starting to talk to customers to grant credit for mid-, long-term purchases. So it's still a moment for credit stabilization in Argentina for us to really to go back seeing significant renewal volumes. And this is something that we understand as part of the restructuring the company is going through. All this happened in Brazil before the real plan. And as of then, we saw that in Brazil, we had a much more stable credit scenario. So that's what we expect for Argentina as well.

Our next question comes from Lucas Laghi from XP.

So I have 2. You did mention a bit about inflation in the end of the day because you have jet fuels prices impacting your companies, diesel impacting the profitability of fleet owners, but also the increase of inputs, steel, aluminum, electronic, electric components. I would like to understand within this context, what is the NDA of all that. On the one side, we have the perception that Marcopolo is a player that hedges itself against future inflation. So how do you see your portfolio today vis-a-vis this possible inflation impact on inputs? And what is the capacity of passing through prices that you have today with your clients? In the current scenario, do clients accept any price increases because of the inflation pressure that we see on also bus bodies as well. So just to try and understand if what I'm saying makes sense and what's your capacity to pass through costs? And the second point, just to understand, especially in Mexico with the decline in production, what is related to market, if there was a one-off effect, downtime, something that we haven't mapped or was it just the market? Just for us to understand the outlook for Mexico. These 2 questions.

Thanks, Lucas. Thanks for your questions. I will start with inflation. When we look into the effect, as I did mention, we do have a positive impact on the Coach buses segment. Indeed, the increase of jet fuel prices were -- was higher than diesel prices increases for the Coach bus segment, and that brings higher pressure to air fares compared to bus fares. So I think this effect first brings us higher potential demand in terms of number of passengers for the Coach bus segment compared to the air segment. In City buses, and we did mention that before, the inflation pressure of diesel prices brings higher challenges for operators that were trying to have a financial economic balance in contracts. And now in addition to seeking adjustments relative to the inflation of the past, they have this additional pressure of this moment because of an increase in diesel prices. So in City buses, there is a higher challenge, and it is what I mentioned that there is more room for us to occupy because of the biddings that we were awarded. And then if we consider the whole context, thinking from the viewpoint of our supply chain and all inflation that we have had in purchases, I think the fact that Marcopolo has a more adjusted portfolio today, especially when you talk about Brazil, we have a portfolio of 2 to 3 months, our backlog and that enables us to work with adjusted prices. So we are keeping the pass-through of inflation impacts on our costs in the products that we sell. And within Caminho da Escola or other bidding processes, we have already worked with a stress scenario in terms of inputs, at least for the first year of the contract, knowing that in an eventual renewal of contracts for another year, we do have another possibility of adjusting prices. So again, within the context of our business, if we consider inflation impact, we are relatively covered passing on prices to our processes.

And Mexico?

Oh, yes. Andre is in a disconnection. He wanted to talk about Mexico, but I'll start. The Mexican operation has suffered this first quarter, but it also suffered the consequence of tariff adjustments since Liberation Day when Trump created a tariff scenario that brought impact to those companies that sold buses to the U.S. from foundations that were built in Mexico. And so indeed, many investments that were being executed in Mexico or that were planned to be executed in Mexico were delayed and/or even stopped. So the Mexican economy is being affected substantially in terms of CapEx. And when that becomes materialized, we see less mobility and less demand for fleet renewals. Okay. So for now, what we see is a very challenging scenario, again, because of a lower volume of investments that were made in Mexico and a lower demand from our customers. Andre?

Yes. Just to add, and thanks, Lucas, for your question, and thanks, Pablo. As Pablo did mention that the market is quite retracted. If you take a look at the numbers for '25, the closing of the industry numbers were very close to what we had in the pandemic. I was in Mexico in the beginning of the year. You hear the uncertainty much because of the relationship with the U.S. and tariffs and any impact that might have. On the other side, we start to see some sales in the Coach bus segment. Remember, it's smaller. You'll have several of our competitors closing good deals in the beginning of the year. And now we are seeing some deal closings on the side of Marcopolo. That's why in the release, we did mention that we have some sales taking place. There is still a maturing process of G8, our product launch in the market, but the market is being very much affected. So it should be a tight market for Mexico, a tough beginning, but this is a time in which we are developing a new product G8 that was launched, but also cars that we are planning for the American market. But within our international operations is the one that is most suffering in a macro scenario, but we see that when the market goes back to the levels of '23, '24, we are going to have higher relevance in terms of deliveries to the country.

Our next question comes from Kiepher Kennedy from Citigroup.

Just a quick follow-up about the Caminho da Escola program. On last 14, the company was awarded the Phase 13. If I'm not mistaken, there was still a batch of 2,000 units. Next week, we are going to complete the 30 days. I think you're going to have the certification of the auction. Do you have any update with regards to this last batch? Is it something that you think is going to be announced by next week because that would lead the company to an award of 100% of the bid? And the second thing, we did see a decline in market share in terms of production this first quarter compared to the first quarter of last year. Could you give us an update? You talked about a longer downtime because of the collective vacation. You had a higher drop in market share than the competition. So I would like to understand the market share retraction.

Okay. Thanks for your question. This is Eduardo speaking. I can use this one. The legal period for certification is 60 days. So we still have some time. The process is moving on naturally. All the models possible to be won -- all our models have been certified in the Caminho da Escola program. The process is moving as expected. And remember that Marcopolo directly was already the winner of this remaining batch. We don't think there should be a change there. What could happen is a change on the decision that was already made and that indirectly awards Marcopolo. If there is no change, Marcopolo will continue also with the 2,000 additional units. We are working on certification, and we do not see a reason not to be the winner of this 2,000 units. This is our view, and we remain with the batch of 7,900 units as mentioned, everything running as expected.

And just to add to what Eduardo mentioned, I would like to congratulate the team on the results, really fantastic. The number in terms of sales to Caminho da Escola will certainly help us in the second half of the year, first half of next year. And then we have to try and renew the package that can be very positive for the company. So I thank the whole team for the good work and [indiscernible] program. About market share, this is a fact. We did lose market share a long time. If you take a look at the downtime in the beginning of the year, yes, that had an impact. The Ana Rech operation where we produce our Coach buses resumed January 19, which is late. We do miss a lot of volume, but we see that Coach buses will gradually recover share. We see that clearly in our plans when we start to increase the number of units produced by day. So we should have a recovery. Micro buses will naturally pick up with the Volare sales. We are leader where we operate and also the sales to the Ministry of Health and Caminho da Escola. The segment that is tighter, I would say, is City buses, which is important because the cost increase, there are no renewals. Operators are waiting for subsidies and that affects the company because you have an industry with huge capacity to produce but lower demand. So this is a segment in which we did see a relevant loss, as Pablo mentioned, we are changing much of this production for what is happening, which is the micro buses, but we do see a drop. And now we have to use these credit programs to work with our clients and recover the segment. So we see this clearly happens with coach micro buses and a bit harder in the City bus segment.

Next question comes from Gabriel Rezende from Itau BBA.

I'd like to go back to the discussion of margins. This quarter, when we exclude the equity line, there was a contraction year-on-year and even higher contraction quarter-on-quarter, which can be explained because of low seasonality, about 14% and you were running at about 18%. I would like to understand what impacted the demand? And should we expect this equity income close to 18%? I'm excluding nonrecurrent equity income, but also the amount that you booked in the first quarter. And the second point is still in margins. I did understand what you said a disappointment in the City bus market is partially offset by numbers of units to the Ministry of Health and Caminho da Escola. Could you have a better margin of the segment because of this program because these programs may have a margin that is above the company's consolidated margin? So when you have more volumes for the Ministry of Health and Caminho da Escola and not City buses, you could have better margins. Is that correct? These are my 2 points.

Gabriel, thanks for your questions. Well, in terms of margins, we do not see a reason not to pursue what we had since 2024. In terms of mix, we do see a good mix. So when we compare to '25, we even have a heavier mix with higher value added. So the specific City bus segment we see a growing volume in the Caminho da Escola program in the previous bids. We did not have the volumes we have now. And part of this volume is classified as City buses. So when you put together the renewal of Caminho da Escola and the buses that are being delivered by Caminho da Escola and the Ministry of Health, we do have a good mix. So we do not see any reason for us to review or change what we saw in '24 and '25. An interesting factor is exports because then it is the company work to monitor of that. As Pablo mentioned before, talking about costs, we have to also have a constant pass-through to sales to the foreign market. And this is what we are doing, discipline in all segments with City buses, micro buses, new bids, Coach buses and exports also passing through prices in dollar.

Our next question comes from Andressa Varotto from UBS.

I would like to approach your operations overseas. We did talk about them today, but the drop in volume was quite substantial. It did draw our attention. I would like to know if there is any seasonal effect. You did talk about Mexico and Argentina. But how do you see volumes for the coming quarters? And also revenues in Australia, do you think these revenues offset the other areas? And also, I would like to know about FX impact and how do you think this will evolve along the year. Will deliveries to Australia continue? Do you have any other positive mix effect in overseas operations that you would like to mention? That's it.

We are having a bit of a problem with connection. Andre did have some difficulties, but let me answer that. Thanks for your questions. Talking about international operations, I did talk about Argentina. This is a matter of customers assessing the better financial conditions in terms of credit availability for us to see the market coming back. It is a very significant repressed demand in Argentina. Andre talked about Mexico. I did mention that as well. Out of our operations, perhaps the Mexican operation is the one that is the most challenging, considering the scenario of investments, all the tariffs. So while we don't have more clarity between this agreement -- of this agreement between Mexico, Canada and the U.S., the operation will have challenges to deliver value as we have delivered before. For Colombia, I think Colombia can be a positive effect in the coming months because we are resuming negotiations for the new bidding processes, which are very relevant to our operations, a significant renewal of the bus fleet. When we did have the acquisitions, we had an outlier delivery considering the day-to-day of the business. South Africa, we see a market with a demand that is still quite heated. This quarter, we are going to feel that a bit more because there are some clients that are delaying some purchases, but we do not see an operation that will deliver less value. The market itself is effectively seeking renewals. And China, this is a very small operation with some deliveries, especially to the Hong Kong and Australian markets. And talking about Australia. Indeed, this is the operation that is generating the greatest value this quarter. It is in a turnaround -- a strong turnaround process that started in '22. In '23, we started to put together our backlog. 2024, we delivered results, and it reached its peak in '25. And now '26 should not be any different. We already have a quite structured backlog for Australia this year, already starting the year of '27 indeed, considering bids that happen from time to time. And that's what is very positive for the Australian operation is that, now we have been able to go into other markets in the country in the South Australian market, which is a market that we did not operate before. But in the last bid, we were successful. So perhaps this is the main business for deliveries at least this year. So Australia should keep a very high level of revenues along the year, at least in the portfolio that we have today. And then we talk about FX that may bring some effect in terms of consolidation of results, at least in each of the countries we operate we have been keeping our prices at the front end. So what we see is that, although at the consolidated level, we control our results in reais, but we also control results in each of the countries that we operate. I think that's the key point. The Brazilian real appreciated compared to the dollar, but also the other currencies of most of the countries in which we have investments and also in the countries that we export to. Argentina is slightly different because of the price adjustment scenario that they are going through. But in the other countries, we do see a very strong correlation to what's happening in Brazil. So when we look into local currencies, we do not see a loss in value when we convert into dollars. In fact, we should have more dollars being consolidated. But again, as we do not release guidance, this is a very short-term scenario considering what we saw in recent months. And this is what we are working with at least internally.

Andressa, just to add to what Pablo mentioned, it's very interesting to see our market share position in our markets with the exception of Mexico that we started with lower sales than the competition. In the other areas, we are keeping our market share. So that shows that the beginning of the year is more aligned with the seasonality that we have in Brazil. Of course, we have Transmilenio, we have more sales packages. South Africa may be important to us. But what we see is the maintenance of our market share a long time. Remember that in the post-pandemic, the volume was very low. Several companies quit the market or were in a very bad financial situation. As the market recovered, Marcopolo gained room in international operations. And we have been able to keep the share a long time in the 5 of the 6 operations that we have. I'm excluding Mexico that we expect to recover along the year.

Our next question comes from Lucas Melotti from Safra.

I have 2. After a very tough '25 in New Flyer, we did see a very positive recurring result. Could you give us some details about what to expect for the remaining of the year in this operation? And just as a follow-up in diesel prices. Do you expect electric City buses gain momentum because of the increase in fuel? That's my question.

Lucas, thanks for your question. I'm going to start with New Flyer. New Flyer did have a very positive quarter. Somehow, we are following their releases and guidances. And what we see at least the information we have is that, effectively the scenario for '26 should be the beginning of the company's turnaround with a backlog that shows very good deals closed and increasing profitability. So along the recent quarters, they have been able to increase prices. So -- and the company also has internal changes prioritizing execution. So in the context, we see a healthier backlog and the company focusing on restructuring itself to have less execution flaws. And therefore, we should see a New Flyer scenario more in line with what it represented in Marcopolo's results in the past. What is important to highlight, and this is a comment made by the New Flyer management in the last release, the fourth quarter, we've been -- New Flyer seasonality was stronger than expected for the first quarter of '26. So this is a point for us to watch for us to understand the seasonality also happens there. Talking about EV, in practice, we do have a scenario. Electrics have to do with the City buses. When we talk about infrastructure, when we talk about contracts that have to be renegotiated with city administrations. So it is a structured purchase that demands more subsidies and financial structuring, but this movement we can observe in most city administrations starting the discussion. But between discussions and materialization, there is a whole financial structuring that has to be organized. So we do not see an increase of diesel prices generating immediate demand for electric City buses. But we do believe there is a natural flow in other countries, not only in Brazil for new fuels. And here, we are going to have to work on that. We have biodiesel-driven vehicles, ethanol, biomethane, all of them gain momentum and infrastructure for these buses to start being used. So with the increase in diesel prices, perhaps we are going to have more discussions about new fuels, not necessarily electric buses, but other fuels discussed by city administrations. And going back to Brazil in the restructuring of contracts and a more balanced economic financial scenario.

Lucas, I'm just going to add to what Pablo said because I think your question is very interesting. This is an opportunity for us. What we see is that, with electrification because we are seeing every year, the amount of electric buses is more than the previous year, but less than expected. This year, we are seeing a surge for diversification, biomethane, gas-driven buses, biodiesel. So other fronts being developed. It is a window of opportunity for us. In Brazil, we are the largest ethanol producer, biodiesel. So I think for Marcopolo, a company that has diversified its portfolio in all kinds of fuels is an opportunity. So if you tell us if we are going to know exactly the volume of each fuel to be sold, we don't have that. But we are prepared to have the different solutions, different fuels for whatever direction the market chooses. Our presence in [ COP ] shows that the capacity of Brazilian industry to deliver what the market needs, available solutions that are quickly scalable. So this is what we're doing. We have biomethane buses in the market. We are testing hybrid solutions. We are working with chassis partners to have all solutions available. So it is a window of opportunity, and you said it very well, the increase in diesel prices may be fuel for other solutions to be adopted by the market.

Next question comes from Marcelo Motta from JPMorgan.

I have 2 questions that you haven't approached so far. The first is capital structure. You still have low leverage. The expectation is to have a payout of 50% because of a higher select weaker market. Are you considering having some changes in that working capital? I don't know. Do you see a possibility of increasing payout? And also CapEx was lower year-over-year, nothing relevant. But to understand if this is seasonality or if you want to be a bit more conservative in CapEx compared to last year.

Thanks for your question, Marcelo. Capital structure and our payout strategy, this is maintained the same rationale that we applied until today, 50% payout. In this context we have today, this is what we have in line with our Board. And as for CapEx, we are keeping our level of investments in line with the BRL 350 million a year that we have been talking to you about. In fact, the first quarter, it was a lower volume compared to last year, but that is just a matter of execution of projects along the year. So throughout the year, we should see a number that is very similar to what we saw in the last 2 years in terms of investments.

Marcopolo's Q&A session is now closed. We'll turn the call to Mr. Motta for his final remarks.

Well, thank you very much for joining us. Thanks for your trust. And remember, we are here together with IR team for any questions you might have. Thank you very much.

Marcopolo's conference call is now closed. We thank you very much for joining, and wish you a good day. [Statements in English on this transcript were spoken by an interpreter present on the live call.]