Movida Participações S.A. (MOVI3) Earnings Call Transcript & Summary

Good morning. Welcome to the conference call of Movida to present the earnings from the second quarter 2022. We have here with us today, Mr. Renato Franklin, CEO; and Mr. Edmar Neto, CFO; and IRO. [Operator Instructions] Before moving on, we would like to clarify that statements that may be made during this conference call with respect to business prospects, forecast, operational and financial goals of the company are all based on beliefs and assumptions of the Executive Board of Movida as well as on currently available information. Forward-looking statements are no assurance of performance as the beliefs and assumptions involve risks and uncertainties since they relate to future events and therefore, depend on circumstances, which may or may not occur. General economic conditions, market and other operational factors may affect the future performance of the company and lead to results which may materially differ from those expressed in these considerations. I would like now to hand it over to Mr. Renato Franklin. Mr. Franklin, you have the floor.

Thank you very much. Good morning, everyone. Welcome to the Second Quarter 2022 Earnings Conference Call. I'm going to start by thanking all of those that have supported us and believed in Movida and have executed our strategy. The quarter's results are consolidating new levels achieved. We've been emphasizing about the transformation we've been made. The transformation is now being translated into figures, and it's the result of the strategy that we selected. The strategy of renewing the fleet and investing in digitalization of our clients' journey has been acknowledged by the clients. And as such, we have kept on growing, generating value, adjusting prices to the current conditions and improving the operational profitability of the company so that we could deal with difficulties. The numbers show the results. The operational result had grown 90% over the second quarter '21, BRL 2.4 billion. And the EBITDA grew more than the revenue, 133%, BRL 900 million in EBITDA, which is an EBITDA of 2020, delivered in one single quarter, and the second quarter tends to be the one with the worst seasonality for our business. So very promising. And what is our main highlight? As we've been emphasized, used car sales going into a normal range and Rent-A-Car has increased BRL 700 million coming from retail, 160% growth of the EBITDA from Rent-A-Car, giving more stability to the company in a different level in terms of operation so that we can keep on adding value. Net revenue, BRL 168 million, 8% margin and we delivered, as such, a record in our ROIC, 9 percentage points, 17% of ROIC, 36% of ROE. So very high, which are the return on investment of the company. It's important also to emphasize the recognition of the evolution and transformation of the company, just increasing 3 notches of our rating. So Fitch has raised on to AAA in Brazil and BB internationally really showing the scale of the company, diversification, resilience and something that really makes us confident to keep on investing and obtaining value for all stakeholders. On the right, we can see our strong operational performance, 206,000 cars, 39,000 cars added in recent months. 15,000 cars quarter-over-quarter. The first quarter, we had 207,000 cars or 54% growth of fleet expansion over previous year. The second line is also very important. The record of revenue per car in all our business lines. And for the first time, second quarter greater than the first quarter, considering seasonality just for you to have an idea, the trend is still to keep on increasing with strong foundations and clients really adopting our strategy. They want new cars. There is a different value, but it's a fair value for the car and for the service and the digital journey. The daily rate 140, the average ticket. So we are going to see that increase, the revenue per car is going to increase as well. When we see GTF, the fleet management transformation is not less important, almost R $1,200 of gross margin per car. Of course, here, we have -- we need renegotiation and renewal of fleet. We are going to see revenue per car growing up in GTF, which is where we have our main growth coming from. We have private fleet, public fleet and also individual signatures or the subscription of car use. This is all under GTF fleet management. Now the third point, we have 48% increase in our average daily rentals. So 1 million new clients in the past 12 months. We've gained market share resulting from the strategy of renewing our fleet. It's the newest in Brazil and also the digitalization of client journey. All clients emphasize how convenient it is to use the tablet to deal with contracts. It's less conflict. So as a consequence, people end up renting more cars and recommend our company to their peers. So it's a very interesting mobility alternative. The next point, we had a record of 18,000 cars in MAU sales, average ticket of 67,000. So here, we can see a trend. We are going to keep on seeing increased volume, average ticket increasing. There is still an average ticket to be adjusted because we sell part of those GTF cars and some other cars from RAC. This is going to change. And dilute and compensate the margins from used cars that we are moving towards a more normal range that we used to have that before the pandemic, and it had been changed, and now it's going back to norm. And finally, we were awarded as a more sustainable company in mobility and transportation by Revista Exame Magazine recognize we have had a number of recognitions of ESG and innovation. And here, I'm highlighting this one, which really reinforces our ESG agenda. Now let's go into the next slide to talk about our growth. Where is the growth coming from? 73,000 cars extension, so BRL 134 million to BRL 206 million. And here, there are a number of important messages. In addition to expanding the renew, we have -- the fleet we have renewed our fleet differently from the industry. This is a company that has a renewed fleet and after that, of course, there has been a number of impacts, and we've been through that. This is something that helps us be prepared, deliver very experience and be acknowledged by our clients. 54% growth is a lot, but in yellow, we have GTF with 91%, 106,000 cars, 10,000 cars in the quarter and the automaker program. So sales have been increasing progressively. July is better and we are going to keep on buying and that's where we are going to get most of our growth coming from. It's going to be somewhat smaller because of selectivity and the scale we've achieved, but most of the growth is through GTF and RAC or Rent-A-Car, we can see 28% growth of fleet in Rent-A-Car which is once again the result of clients' perception. They want more cars. They help us adjust the price to the market reality and also enables us to grow further valuing our strategy. Here, we have the EBITDA margin from rental 15 percentage point of this merger. It's a lot. It's very relevant to us. Said that, we have achieved the scale we needed, 200,000 cars. We have fleet volume to negotiate all products and as a result, we have an option in terms of expansion and renewal average agile cars is the newest all over the country, and we have reached a scale. So now that the interest rate is higher, we can be selective in growth and maximize value to really deal with the high interest rate period, generating value to our shareholders with our main commitment. You're going to see it's a company that's going to dictate new benchmarks of value generation in the midterm. This is our growth. We need no longer to grow. We need to add value. Let's move on to Slide 5 to talk about results, financial numbers, and Ed is going to give further data. We are analyzing retrospectively, of course. So the quarter-over-quarter net revenue 90%, 133%. Look there LTM, it goes from BRL 5.3 million in '21. There is a company for the past 7 months that made BRL 7.5 billion. And when we analyze the second quarter, which is exactly where we are today, this is a company that earn BRL 9 billion in gross revenue. So there is still some reduction to be captured retrospectively, that hasn't been shown yet in growth cost a lot. It has caused a lot to be delivered more assets, proportional growth, I don't ask because inevitably, we have to buy more cars, selling more cars and adjusting the company. From now on, once we don't need to grow so much, the margins are going to get even better. The same applies to be R $3.1 million LTM and R $3.6 million annualized EBITDA. If we compare to the EBITDA we used to have in 2021, 2020, it cannot be compared. It looks like a completely different company. And that's my personal opinion. There is no other companies that have such great opportunities today. That's what I think at least. The EBIT grew for 151% if we compare '20 with an LTM '22. If it looks just the second quarter, '22 over '21 is more than double, even with depreciation. So as you can see, operational significant progression, which is going to be maintained to compensate the higher interest rates in Brazil and the depreciation of used car sales. And it's going back to the norms to the numbers it used to be. It seems to be greater because the amount of the cars, the car cost more. It's a different company. But relatively speaking, it's very similar to pre-pandemic periods. And the gross margins are going to go back to pre-pandemic periods. The EBITDA of Rent-A-Car has been increasing at a level that we didn't expect to see. And this is going to keep on growing because the market has solid foundations. Net debt, 219% increase, very relevant numbers. And in the quarter, BRL 197 million good net margins but showing that now we can capture price increase to compensate the interest rates. Let me now hand it over to Edmar, who is going to go into each business unit. Edmar, please.

Good morning, everyone. Thank you, Renato. I would like to invite all of you to go now to Slide 6, please, where I'm going to go into details about our business. First of all, a very important highlight. It's the net revenue from RAC, very important function here in terms of price, and we've been growing 87% over the second quarter '21, BRL 2.2 billion year-to-date, 12 months annualized BRL 2.5 billion. Now speaking of EBITDA, it grew more than the revenue. We are capturing margin, another record BRL 385 million, 7% margin, 60% margin rather. So we still have got something to capture because we still have movements of price adjustment and efficiency. Here, we have the EBITDA which goes from over BRL 1.3 billion, nearly 60% margin past 12 months. But looking ahead, we are talking of an EBITDA over BRL 1.5 billion. On the right on the slide, we can see the revenue per car, the price per car, 3,000 -- R $2,973 or 46% increase, which is a record. And we can also see in the quarter in July, a new price range that we have moved to. So revenue per car, getting to the highest level ever in the company. And the EBITDA per car follows exactly the same EBITDA per car, more than doubled quarter-over-quarter, reaching R $1,600 in the market. Now going into the next slide, let us speak about GTF, our fleet management, where we grew the most in this quarter. And it's important because this is exactly our strategy. We have focused on long-term contracts, which brings more resilience and predictability. So record revenue, 120% growth, BRL 441 million. In the past 2 months, BRL 1.5 billion in revenues and looking ahead, BRL 1.7 billion. Now speaking of EBITDA, we can see a margin of 71%. We've adjusted the margin up in the past 12 months, BRL 350 million EBITDA, consolidating this margin over 70%. Just look to the side where we see LTM, we are running at 60%, BRL 1 billion of EBITDA and looking ahead, BRL 1.3 billion. On the right, once again, we can see revenue per car and EBITDA per car. The revenue per car, let me make a comment because now we are reporting gross revenue and we have adjusted all indicators accordingly. So BRL 1.884 billion which is a significant growth as a result of the renewal of the fleet in GTF, which is somewhat slower than what we had in other business lines. So it goes from BRL 1,447 to BRL 1,800. And it reaches another record showing the focus on the operational practice to mitigate the effect of the interest rates in Brazil. To speak of EBITDA per car, it's another level that we have never reached BRL 1,200 over BRL 852, which is a 41% increase greater than what we had in terms of revenue, showing that we have really successfully evolved in the market. As we can see in our release, we closed the second means with a backlog of BRL 2 million and a lot of cars to be implemented somewhere in the end of the quarter, but this is going to bring even further revenue. There is a contracted growth in GTF. Now let's go into Slide 8 for used cars. BRL 1.2 billion is our revenues greater than the first quarter last year. 18,000 cars sold on average, 67,000. So dilution starts to show its face. EBITDA is BRL 205 million. It's aligned with the previous quarter, but 31% greater than the previous year. Showing that even with a decrease in margin, more volume and better prices deliver an EBITDA at the same level and as such, we can navigate within this scenario where it will inevitably lead to a regularization of the margins of used cars. On the right, we can see average ticket 22% growth year-over-year. Since 2020, when the prices were adjusted, we already had 53% growth. On the right, we can see a very important point, which I've already mentioned, but we'd like to emphasize, which is the dilution of SG&A because as we have a greater volume of cars to be sold from now on in a higher average ticket, we are going to deliver SG&A below 3%, probably below 6%, probably towards 5% in the short run. Now Slide 9, we can see the performance of EBITDA of Rent-A-Car, where the numbers reflect really the operational result. On the right of the slide, we can see total EBITDA. Renato has already emphasized, 171% growth year-over-year. And 15 percentage point gains in margin showing that the company has been focusing on operation in the operations producing results. Speaking of unit results, and we bring together the 2 rental business line, so 77% growth or greater efficiency because we're talking about a value per unit, not only because prices increase, but also because in terms of cost, we are maintaining it at stable levels or even below what we had planned. When we talk about monthly numbers, this is what we observed. Let me now go into Slide 10, and I'm going to share with you depreciation and make 2 comments here. We've shown a depreciation of BRL 3,500 Rent-A-Car in the quarter. Annualize this BRL 5,000, which reflects exactly what Renato has said. It is the new fleet in the area, in Brazil, and it has to be reflected in the business unit where the turnover of the fleet is faster. In used cars, 3,600, the trend is to increase further, and it grows somewhat slowly because the turnover of the fleet is somewhat slower in terms of renewal. And when annualized, we can already see the number of new cars being purchased. We can see that build up depreciation is resuming its expected previous levels after it had been running at below 5%. Let me now go into Slide 11, where I'm going to talk about cash and our debt schedule. As Renato pointed out, one key highlight here is the upgrade of our ratings for AAA in Brazil and BB globally. Very important highlights. First of all, scale, the fact that we at Movida belong to a group that has a very well adjusted capital structure during complex economic or challenging economic situations, we've been increasing our EBITDA and it is above the EBITDA of the whole year of 2020. So it's a great performance of the company. In addition, we also have a cash profile and an amortization of the debt, which is at the right mix, we can see the need of accessing the market in the short term. There is no need to do that because we have enough cash. And we also have a percentage of fleet where there is more GTF, more fleet management, and we've been growing that more, bringing more EBITDA margin and more resilience and expected revenues, which is something extremely important for a company that has always been growing, and it's part of its DNA. Now here on the right, talking about leverage, even with this growth of 15,000 cars quarter-over-quarter, once EBITDA grows significantly, the leverage gets stable at 3x, which is exactly the level that we want, even considering a relevant growth. So that, I would like to hand it back to Renato, who is going to talk about return on investment, recognition and make his closing considerations.

Thank you, Edmar. Let's go now into slide -- on Slide 12. So when you're talking about our return on investments. The indicators on return really confirm our value generation. And this is our main purpose. We are at record levels of ROE and ROIC and 9 percentage points of spread, which is really relevant. So we know that the cost of the stat will continue to be impacted. We are going to keep on seeing it increase, and we want to evolve operationally to compensate the increase in interest rate. The spread tends to be smaller in the short term until we can have the adjustment of the operation to the new cost of capital going back into an interesting spread levels in the midterm. But we are very excited with what we are delivering, showing that we have market foundations, there is still room for growth. And our choice would be grow less so that we can increase profitability, operational efficiency, generating more value. Now going to Slide 13, and we've talked about ESG and our award, we have also been awarded by the MIT Technology Review, the largest publication of technology selected 20 companies in Brazil, and we are selected among the most innovative workplaces in 2022, really recognizing our innovation, especially with the digitalization of clients' journey, which has been acknowledged by our clients, which is really great. And I would like to thank all of you -- there are many categories. So if we rank second, SIMPAR ranked first. So we just ranked were among the top, so thank you very much, and congrats to our Investor Relations team, who has some transparency, governance, right disclosure level to really make you all confident on everything that we are doing. Now next slide, just for closure, just thinking ahead. Once again, we have a team that really delivers and executes and it's very quickly to get adapted to different scenarios. And this is what's going to sustain our value generation. So interest rates going up, scenario is changing, but we are prepared to deal with that and still generate value. And why is that? Because there are 5 pillars here. Really focus -- first of all, focus on client, the devotion to serve to care. We came here to understand the market, see what clients need it. And we've done that right from the beginning. First, we have been questioned by the market, but now we are being imitated by the market. And we are going to really dictate trends in new fleet, in digitalization and new clients wanting to rent. And this is why we can really keep on bringing more profitability to our business. We have the newest fleet in the market. We've already emphasized that. So now it means we have an option in our path of renovation. We have also conquered scale. We have opened new points of sales. We are going to have new stores coming. It means more channel, some level of growth and by having more levels of channel, we can sell more, let's say, to individual clients and less to segments that pay lower price. We don't pay higher for different segments, but we provide better care, better service to our individual clients. And maybe we can just get -- do without price-sensitive clients. These are not our clients. Our clients are companies which are focused on quality and individuals who want quality in the car and in service. So it gives us really a possibility to focus on the fourth pillar which are the tools of high-performance pricing. We were the first company to bring that. There was -- it was -- the market was just so different in renting car, we changed the face during the day using different algorithms, and we can see an improvement to improve revenue per car. And the fifth pillar, which is a very robust cost and expense management strategy. We can see all the different indicators, employee per car, SG&A, we are and we will always be the most efficient company in terms of cost, always. And we are going to keep on working to use the technology that we've been using for pricing, for the customer's journey to improve our operational efficiency. We have very important transforming projects that are going to leverage us further. In the past, we used to talk about rewriting the benchmarking of the industry. Occupancy rate is great, is higher and the revenue per car has been improving. So we are going to go into a new cycle of transformation of the operational levels for the industry. It's going to generate value even during higher interest rate. Said that, I just emphasize that we have a specific strategy of renewing the fleet. It proved to be effective and built loyalty of our clients, attracted more clients and improve our market share. So thank you all very much. I'm sure that best still to come. And now let's open for the Q&A. I'm sure there are going to be questions. So let's start, so that we can go into further details. Thank you all very much.

[Operator Instructions] Our first question comes from Gabriel Rezende of Itau BBA.

I would like to go further into the terms of fees for RAC and for GTF. You've talked about the seasonality not being so good in the second quarter, but still the fees, the prices of cars was very similar to what we had in the RAC for the first quarter. So what is the qualification segment over segment? And what can we think about trends, especially because you said that July has been good? And in terms of GTF fees, I would like to understand what has justified that increasing revenue per car? Was it 0 kilometers or review of contracts of the second -- first quarter to second quarter? And what are the trends for the future?

Thank you, Gabriel, for the question. Now speaking of Rent-A-Car, RAC, the second quarter tends to be well less retail fewer bits of occupancies where we can charge higher prices. But we've been increasing price over price. So it's a quarter where we had significant price adjustments in our monthly contracts, and this is going to help in the third quarter because it's been growing and it helps us. So it's a new basis of prices. And in our daily fees, it depends on occupancy. We set a priority. As we are growing and preparing the company for July, where we have a high season, and it costs money because you need more cars not to impact occupancy. We didn't increase the price as much as we could to allow fleet increase during July, right? So looking ahead, 140 on average is July, August is going to be better than June. So a very positive trend of keep on increasing prices in some segments. When you increase prices in all segments, the mix also helped because those segments which are price-sensitive, have a reduction in volume but then you have more cars exposed to the segments that pay better prices for rental, improving the revenue per car. In terms of GTF, review is really important, it helps in increasing prices of our whole portfolio because otherwise, it would take too long to do it. The average age is still old, but new contracts also matter when you have 2,400 to 1,300 new contracts for 0 kilometers of private fleet management or any others. The tickets are quite similar, 0-kilometer is somewhat lower, but similar price, but the margin is better, but prices are very similar in terms of rental because it's a large company. It has a better negotiation power and end up paying the same as, let's say, an individual person, which is renting. So the trend is to increasing it further. If we are going to new contracts 2,300, 2,400 as we replace the portfolio, we are going to renew all of them.

The next question comes from Alberto Valerio of UBS BB.

Now looking ahead, and think about tax. You've seen that you reported some accelerated depreciation. I would like to know if you have any plans to use the credits resulting from it? And the second question about car mix. With the normalization of the automakers and maybe the automakers are going to offer more cheaper cars, would you be interested in going back into this segment? Or do you intend to maintain the premium car segment only?

Thank you. Let me start by purchasing cars first. We are going to buy the cars, the clients want to rent. It depends on market transformation. Yes, there is more demand for entry-level cars, which are not being served. The market hasn't -- does not have enough growth. If that is a possibility and the level is better, fine, we're going to purchase that. But there is an increasing also demand for SUV cars, and we are going to buy as the demand happens. Of course, the macro scenario is going to impact the purchasing power of everyone. People are considering renting car rather than buying cars. So if we have growth of 2 segments with a mix, it will depend also on the offer on the supply of the automakers. I just expect a gradual growth really. In terms of tax credit, Alberto, everything is running as planned in the company, and we are going to use these tax credits eventually.

The next question comes from Victor Mizusaki of Bradesco BBI.

I have 2 questions. The first one, going back to the mix, car mix. We've seen the transformation of the fleet. And thinking about mix between both cars and sold cars, when sold car mix will be reflected in the new fleet of Movida? And second question, concerning your comment, about the option of renewal and some reduction in the growth rate, we have had a simulation. And if we consider in a hypothetic scenario that your fleet will be of about 18 months. Your 3x leverage, it would be somewhat below 2x. So the result of this simulation, does it make sense to you?

Thank you, Victor. When we look ahead to normalize because there was a transformation in Rent-A-Car, but not in fleet management GTF. So to normalize sales and purchase, it will just adjust by 2023. The average ticket of used cars will increase but it's going to go into a normal evolution as we call is what we used to have before the pandemic, nearly 5% per year. We expect to hear something close to that from now on. Maybe there might be changes. We don't know yet. When we say the industry is getting to its normal level as of the second half of 2023, there are some supply chain bottlenecks, things that might still influence the offer of cars. But I expect that equation of prices of purchase and selling in Movida, has been building and executing better and better in used cars. So I'm not going to my performance of used cars before the pandemic, it's going to be better from now on. The depreciation is focused on a positive EBITDA. It's not 0 EBITDA. And the average ticket will be closer to the average -- the purchase average ticket will be close to the sales average ticket. Second question. So I have 2 comments, Victor. First of all, if we maintain our growth at similar rates, we would already deliver a leverage of 2.5, 2.7x. So yes, you are right when you say that. In addition to reducing growth, we allow our fleet to get older, it would take us to a leverage of 2x. But it's important to emphasize that when we look closer and having that option -- optionality is really important in terms of leverage because we have already renewed our whole fleet and in GTF, we really depend on contract renewal. So we have renewed the fleet during a situation in which the average interest rate was 6% or 7% going from 2 to the 13 that we have today. When we look ahead and interest rates will be higher for a longer period of time, renewal of fleet of whoever starts to do it now, it will be at higher rate. So it's going to be different from what we have had. All our efforts of having additional debt, using our capital structure has led to an increase of our assets in a relevant fashion. So asset and liability go hand in hand in our company. So it really makes us confident that from now on, as Renato pointed out, we can analyze the situation and modulate how much growth we expect. But you are right in your analysis.

The next question comes from Enrique Simon of Credit Suisse.

I have 2 questions. First, level of depreciation for Rent-A-Car, RAC, what's the percentage of that immobilized that you expect? It's 5.7%. It seems to be growing a little bit. And thinking about the long term, what was the assumption of the net debt and interest rate as there has been an increase in the interest rate of Selic and it has impacted the financial aspect from the bottom line. So what is your expectation there?

Thank you, Enrique. Our goal, which is our company's guidance hasn't changed, even though the interest rate today is higher and when we look at the curve, you can see that it's higher than when we published the guidance. And why is that? Why is against us, right? Because the operational performance of the company, we have anticipated the steps. We are bigger than we used to be. We have more assets and we are delivering more margins. So it really makes us comfortable not to change the guidance -- long-term guidance that we have provided. To the contrary, we believe there is an optionality once again, of reducing our growth. Concerning the depreciation of Rent-A-Car, this is the best snapshot for today. And you are right. We are working between 5% and 5.5% somewhat higher than that. But right now, as in R-A-C, RAC, we have already renewed the fleet, there would be less pressure from now on. But once again, it will depend on the market. It won't depend on us. But I emphasize once again, we have the baseline, and we have some models based on which we calculate our depreciation.

The next question comes from [ Felipe Nelson ] of SeaBank.

And I have 2 questions here. The first, a follow-up about the normalization of purchase and sales of car. You said that you expect prices to resume within the mid-'23 but in terms of volume, what is your take on regular volume levels? Do you expect it to reach the same levels that we used to have in 2019 in terms of volume or not? And my second question is, now that the merger of Localiza and Unidas has already been consolidated, the market has settled and understand how the players will be, what can you tell us about competition? Do you expect any changes in the competitive scenario? These are my 2 questions.

Thank you, Felipe. In terms of volume, in terms of price, we have the average ticket of used cars coming closer to purchase. We expect it to be similar. The industry believes that supply chain will be normal by mid-'23. Today, it's better than last year. There are more automakers producing cars with fewer issues, but still with small volume in some large car makers. So the offer of car mix is different from what would be the ideal demand. So we have to get adapted to the demand and have to look for clients that are interested in renting that specific car. We expect it to go back to normal levels by mid-'23. We had expected that for this year. And then probably it's going to be beginning or middle '23. Now the second point concerns the further. It's good. It hasn't changed our strategy whatsoever. But competition is smaller because there used to be 3 players and now, there are just 2 and 1 that has to reorganize companies. So we still have 3 players, right? We don't know what's going to be the position of the third player, but it hasn't changed our strategy. The scale we currently have is enough to compete regardless of the factors involved in the market.

[Operator Instruction] The next question comes from Ygor Araujo of Genial Investimentos.

And I have a question. When you started your presentation, you emphasized about the expansion of your portfolio of clients. How has the strategy that you presented to us which was just beginning and you presented that in the Investors Day about the new strategy of sales, a partnership with Mercado Livre, how has it impacted your cost of client acquisition? Could you tell us more about that?

Thank you, Ygor. The partnerships are not very relevant. It's more of a niche operation. It's part of Movida Car but it's -- the results are not material. What matters is growth in the digital basis in individual clients and also a significant growth in corporate clients, especially travel agents -- especially because of the recognition of our high service level and the newest fleet. The priority of our growth is in our own digital channels with the direct customer. This is our priority.

If I may add one question. Now talking about CapEx, at that day, Movida Day, you presented an exercise in terms of renewal rates for CapEx. That guidance that we had, which was BRL 5.16 million still makes sense? Or should we expect something lower now because maybe you expect to have better fees and better margins from Rent-A-Car?

We are we still aligned if you get the CapEx of the year, it's still proportional to our plan and what we anticipate for the future is also aligned with that. Of course, we have the optionality, the option of reducing growth, if you want. We can still see room, especially for GTF long term, contract profitability. When we price the interest rate with a safety margin, generating value, no matter what the scenario is. And this is exactly from we are going to get growth and renewed it from GTF. Rent-A-Car we have renewed, but we haven't changed any forecast of our guidance. Considering the first half of the year right in the midpoint between BRL 5 billion and BRL 6 billion, so it's BRL 5.6 million annualized, if we have to repeat it. But it's what Renato has said. We are going to analyze the market situation, make decisions and our focus as has been since 2018, we want to grow further in GTF because we believe these products in the long term can bring us more benefits to our strategy.

The next question comes from the webcast. Lucas Barbosa from Santander.

And I have 2 questions. First, could you please tell us how much of the price can be explained by the mix of sold cars? And how much was impacted by price decrease of the same car models? About the effects of growth in margin -- increase in margin, how bigger will the EBITDA margins be if the companies had levels of mobilization of smaller cars?

Thank you, Lucas. Now speaking about used car prices. The official price list -- average price lease has been decreasing. So there is an effect of car mix. Cars are costing more and more. So prices are going up, and there is also a positive effect of valuing. What we purchased in the beginning of '21 has got high value, which reinforces that our strategy has been appropriate differently from by now. Now there's not going to be an increase in price of cars. So today, renewing a fleet cost more in terms of cost of capital, yes, because the price of used cars and 0 kilometers cars. So there is a mix effect causing the increase and there is also an effect of the channel mix, retail was -- had a higher pressure. Now it's going similar to what we used to have in the mix of retail and wholesale before the pandemic. We are opening more stores so that we can sell more and more cars in the used car stores. And we have been increasing the number of used car sales. Second question about the decrease in growth and EBITDA margin. If you look at EBITDA margin, there is a cost of implementation, turnover and so on. If we removed 1,000 cars growth of RAC, there would be almost 2 percentage points of EBITDA. In other business lines, it varies depending on the lead time of implementation and some other factors of where the car is going to be sold to, which impact somewhat the renewal. In addition to growth, the pace of renewal also impacts the margin as we have renewed the fleet. And now growth is smaller, we can deliver better margins.

The next question is also from the webcast. [indiscernible] from the ZEEQUEST.

Movida because it's the smaller scale than competitors used to have smaller discounts. For the last quarters, however, Movida was the main purchaser. Has that been a different purchasing power of Movida with the carmakers now that the competitors will buy more cars than Movida?

Very good question, [indiscernible] Yes, we have improved our purchase conditions because the car industry has reduced its aggressiveness in direct sales. But Movida closed the gap in most car makers, and that was very positive to us. Now looking ahead, the scale that we have today, the number of cars we have to purchase really allows us to make great agreements similar to other competitors. When you have to buy anything more than that, then you cannot choose so much. You have to buy whatever is being offered to you. So we are at the ideal, the optimal point to negotiate car purchase.

The next question comes from the webcast by Rodrigo Faria of SulAmerica Investimentos.

Two questions. First, with the new Finch rating, what will be the average cost of new debt and how long will it take to have 100% debt with AAA cost? In used cars, what about the breakdown of sales of retail and wholesale? And what percentage of sales in wholesale do you think would be ideal?

This is Edmar speaking. Thank you for the question. Basically, we expect to capture throughout the years, something of about BRL 100 billion, maybe even more depending on growth strategy. And Renato asks every single day, how long will it take for us to capture it all? In our structure, we have made important investments, and it will take some years, but the margins in the near future and the fact that we have a renewed fleet. So the market will realize that we can really deliver more resilient results, predictable results, and it will mean some saves in terms of our debt, but it will take some years. But in the margins, we already see some gains for equivalent long-term periods. In terms of wholesale and retail mix, ideally, it should be half and half because you have retail to maximize value in better quality cars and wholesale, which gives agility to prepare the car, you can sell it quickly. There are other advantages. It is a channel for which we can increase or decrease sales without being concerned to dilute fixed cost depending on what we expect to grow and have leverage. This is a point that we have been recognized right in our ratings. So leverage is a discretionary indicator. If we decide we want to have it 2x, we can do it. And this is a quick adjustment. So the wholesale channel is important to us. It has evolved significantly in terms of digital channels. It gives us a good capillarity. So there are no stores of used cars, for example, there are places where we have a Rent-A-Car store, and we sell wholesale, but there is no physical store. So I can sell for a local wholesale store owner and there is one more factor, which nobody really realizes. We have always had original, very important partner for some car models and the mix of cars that adds value, telling original that sells to the end clients is much better. We have better optionality. So we are creating an ecosystem where we can generate value to our group. Movida doesn't have to make investments in SG&A, and we can keep on growing in terms of sales of used cars, selling at good conditions. We have clear planning. There is no credit risk. In automotive generates also and sell it at sometimes even premium price and something really interesting. It's a very important ecosystem to our group, which is going to generate value in the short term, especially what generates in terms of accessory levels of sales, right, what we offer in addition to sales.

With that, we close our Q&A session. For the questions will be answered by the Investor Relations team. Let me now hand it over to the management of the company for the closing remarks.

Well, thank you all very much. Thank you for trusting us. Our foundations remain very strong and robust. This is going to add value in the short term and the best is still to come. Thank you very much, Movida's team, who has been working hard and delivering very significant results. We are all very enthusiastic, the perception of value of the company has been increasing and value transformation is still to come. Thank you all very much. Have a great day.

The conference call of Movida is closed now. Thank you all very much for your participation. Have a good day. Thank you.