Randoncorp S.A. (RAPT4) Earnings Call Transcript & Summary

Good afternoon, everybody. Welcome to the Randoncorp Day 2026. Today is a really rainy day here in Sao Paulo, but it's -- but in Caxias do Sul, it's much colder, and we are really happy to be here with all of you for another addition of our great event at Arena MZ in Sao Paulo. The Randoncorp Day is also transmitted via Randoncorp channel. It's realized in partnership with AMEC Brasil, and we thank Fab in Brazil from the Board. To guarantee sensitivity and to wide connection, we have simultaneous translation into English and sign language interpretation. Today is a day that is dedicated to transparency and connection with everybody that believes in our company and our trajectory. Throughout this afternoon, our executives, they will share the strategic vision of Randoncorp initiatives and also our development. in. It's important to highlight the disclaimers saying that we have statements in this event that might be based on certain assumptions, and it may or may not happen. So today's schedule, let's check our program. We have 5 panels. We are going to start with from the present to the future, priorities of Randoncorp; Daniel Randon, our President and CEO, he's going to talk about our priorities. Panel #2, financial discipline and strategy is going to be given by Paulo Prignolato . And then afterwards, we are going to have a quick break, and then we are going to have panels #3, #4 with Ricardo Escoboza, the VP and CEO of Randoncorp in South America; and Anderson Pontalti. He's the CEO of Frasle Mobility, and they are going to share about OEM and resilience in the automotive consumption. And then we will have Esteban Angeletti, Corporate Director of Strategy, IR, Finance, and he's going to talk about what Randoncorp is all about. Afterwards, we're going to have a Q&A session with our IR head with the other executives. So your participation is via QR code. If you are in person, you have to raise your hand and then we're going to take the microphone to you. And if you are online, you're going to see the QR code. I'm not being able to pass the slide people. And also, I would like to break protocol and to say that our team, apart from all the executives I have already mentioned, has Gustavo Sa say hello to everybody. He's a senior analyst, and we have Lucas in Caxias do Sul, but today is Gustavo's birthday. So if you can greet him, you can come on the break and give him a happy birthday. Without any further ado, I will invite to the floor our VIP and CEO, Daniel Randon.

Hello, Caroline. Hello, everybody, partners, colleagues and friends and everybody that's online, I would like to first thank our Board and all our advisers that are here watching us and in person also, especially our fiscal council represented by Hi. Thank you for your presence here. And also, I would like to thank our colleagues from the Executive Committee, the colleagues from Randoncorp and especially to Lucy, the President of APIMEC that's receiving us once again, another year, we are very proud of being here and also our investors, market analysts and people that are our partners at Randoncorp. It's always good to be back here and to talk a little bit about Randoncorp, what we have been doing, our projects. Some of our colleagues from COMEX are going to come here and also to talk about it. And we will also be available for conversation. For the present to the future, I'm going to start with that. Last year, I presented this graph. I'm not going to go into specifics, but it's just to highlight that the market is more and more complex and volatile, especially when we understand the macro questions, the geopolitic questions, the wars and projects that we are talking about like changing the times and schedule of employees in Brazil. It's good that we have the World Cup, so people are a little bit distracted, and it shows a scenario that is really challenging. We have inflation above expectations. We have interest rates above expected. And that also reflects in the GDP, a more challenging one, not only in Brazil, but in the world and a challenge that's important for the company is to elevate the interest rates, and that impacts our businesses, and that reflects on the demand and consume. Ponti is going to talk about it and only analyzing trucks and semitrailers that affects demand. But the focus of Randoncorp for the next cycle, we are strengthening the integral vision of Randoncorp. Our mobility we are taking -- enjoying the synergies of the chain together with our clients and the synergies between the vertical ones, financial discipline, we reinforced last year. Even with many challenges and our leverage with projects, we are still doing to reduce leverage so we can improve margins and go back to our ROIC and ROI, minimum ROIC of 15% and a ROI minimum of 18%. That's our role as Randoncorp, generating value in the mid and long term. We are trying to do resilient businesses and our -- we are trying to have more and more projects that will reduce our costs and for us to be more competitive and to generate more value. For today, Randoncorp, it's not only a business, it's a set of businesses is a platform of mobility with spare parts, businesses, aftermarket. Here, we are witnessing 77 years of history in 125 countries selling our products, and we are adapting more and more in relation to cycles. One example in 2015, '17, that was one of the worst times for us in history and then we went -- our products decreased sales a lot. And then we took that opportunity and we were brave enough to restructure the company, focus more and more in our business and tidy up. And in 2026, comparing BRL 2.6 billion and today, with over 17 employees, our protagonists and our origins are with a very small workshop many, many years ago. And we tried to be pioneers always since the beginning. And in the past 3 years, we required 300 patents as Randoncorp being between the 3 main ones together with Petrobras and Stellantis as a private company, our role is to continue investing in technologies that are disruptive. And a challenge that CESA and COMEX poses is to try to monetize these projects more and more. They are mid- and long-term projects, and they bring many opportunities when we talk about sustainable mobility and more competitiveness in the automotive sector industry. And with mobility, we're always trying to find complementary partnerships. Randoncorp was always called Random, which are our semitrailers, and they represent over 60% and OEM 30%. It shows that the company has grown more and more. Its positioning as auto parts. It's a global company serving our main clients and players in the OEM. And also, I would like to say that we continue investing in innovation, and we want to position ourselves as Randoncorp as a leader of Brazilian companies in the automotive industry, not only in Brazil, but internationally. It's important also to highlight it's something that we did 10 years ago, and we are trying to revisit now. We have the principles of Randoncorp since the '90s. Our first planning was in the '90s. And we still have the same principles. Maybe one of our ethical principles is about ethics. It's an opportunity always to reinforce that. And we did some work together with culture, interviewing stakeholders and counselors and founders in a way. It was not my father, but my mom participated in the foundation of the company. And we had the opportunity to reinforce the 5 main values that we are talking about, which is integrity, trust, reliabilities to do things the right way to value people and respect people. We are still reinforcing that as one of our main values passion for innovation, transforming businesses and building the future, sustainable results, preservation of the legacy. And together, we move everything. We can move it all. We have been doing this work. We have new companies, new units in Brazil and abroad. So there is a -- we had -- I had 5 minutes, so I have a little bit more time now. This is why I was speaking so fast. It's a very important role to reinforce the values together with the people because we -- people are so important for us to connect with our purpose, to connect richness and generate prosperity. And that happens when we understand values and we put them into practice, especially when we do things like we walk the talk. That's very important. And as we had new acquisition and new people joining our group, it's important for us to keep telling our story and updating the semantics for the current times. We have a video that tells the story. [Presentation]

I hope you had a little bit of an idea of what we do. In 2020 and comparing with 2025, it's a good comparison. Today, a company that had less than 30% and now it's over 40% of our net revenue with aftermarket. International revenue, we are talking about over 32%, 33% now. So the company has increased its resilience, its geographies. Paulo is going to talk about Dacomsa, which increased our position in Latin America, especially in North America. So for us, it's really important to implement businesses and our mobility system, and that makes us, for sure, to be more resilient in this very volatile times. As I'm going to say, in 2015, '16, we were more exposed to the domestic market and OEM market. And today, that's one of our competitive advantages, composing 1/3 of our revenue in the international market. When we look at the crisis and opportunities, Randoncorp has grown a lot and really fast. And at this time, it's a time for us to look inside and restructure our company, focusing on what's important. And it's important to highlight since closing the Dacomsa and CBS, BRL 2 billion revenues in 2025 and the new operations, Castertech, new units in Mogi Guacu. I highlight the important partnership in this strategic contrast for Mercedes-Benz and strategic partnerships in the capital markets with Patria, starting in our consortium and insurance business. All the strategic agreements, they have reinforced our position, and we continue strongly investing in the improvement of our operations infrastructure and also in our governance besides the operational adjustments that we have been working, adequating structure and reducing footprint and discontinuity of businesses such as Delta, it's a moment of contain expenses to reduce expenses and focus more and more in our mobility ecosystem where we can create and add more value to our business. So in spite of the difficult challenging moment we face now, volatile market, Randoncorp. In its operations minus the one-timers, we have margins that are really good, keeping the historical margins in EBITDA when we look at day-to-day operations that shows that Randoncorp, no doubt is facing a challenging moment, but he has explain for the cost of growing fast, but -- so our main role as Randoncorp is to tidy up our house. When we look at projects to grow 5 years ago, the North American market, we grew a little bit more. But at this moment, it's a more challenging market. The North American automotive market has been proved to be challenging. And it's also an opportunity with less revenue in a few segments, new products we have a moment and opportunity to keep finding internal synergies and the answer of Randoncorp to this scenario, it's not about to be defensive, but it's more related to restructure to have an even higher efficiency to control working capital and our cash flow and a portfolio and allocation that's more disciplined for projects. We understand that the moment now looking in the long term and in the short term, our role as Randocorp is try to find synergies and restructuring projects that can add value and generate cash and reduce our leverage. And here, sustainable development, it's worthwhile pointing out that 2025, we have arrived one of our indicators. Nevertheless, we will continue seeking according to our long-term vision of more and more ESG, it's not something new because it's been decades. We've been working the environment, social part as well as the vision we've reached the reutilization of 100% of the affluence that were treated. And we manage in the reducing the emissions of greenhouse gas effect. Our reduction, our goal is to reduce 40% and important project with important paybacks. And we have also reduced the industrial waste. Now the percentage of women in leadership position from 11% to 22% and launching as well important programs like potential sealing the futures and also getting the GPTW certification. So it's important that we continue to invest in the generation of new patents and also investments in technology, digital transformation and AI. Now AI is worthwhile pointing out, it's been 2 years ago, we began the BI program, which is a program with Microsoft, the Copilot for safe environment and our concern is with respect to the data. We're talking to a lot of opportunities and developing our leadership and all the Random colleagues regarding work with AI and a lot of training for these people and also projects of AI project to improve our productivity and our costs. So there have been a lot of opportunities as well as back office and also operationally wise, so that we can be more competitive and also using AI and taking care and with this concern that people become more and more trained so that we have control of the data and information security. We see that AI is a huge opportunity to improve our service to our clients, increasing added value and increasing competitive in our companies. This is a development, sustainable development, the substation of Fremax. This is an expansion of productive payback was 2.6 years. And the projects besides the initial payback, they have shown an interesting one after the realization of what we have put the example is Caldeira Verde. This is a biomass, and it is a boiler of biomass replacing gas. The payback would be 3.7 years in mobility. And now it's almost reduced. Actually, it's half of the initial payback. With this slide, it's important to highlight that when we talk about pack with the environment, we have payback projects that are very important that also brings not only the reduction of emission of greenhouse gas effect, but brings economy to the company and the lower dependency of energy that are commodities and also that have a volatility -- an important volatility in the market that increases or raises our costs. So this work of seeking for projects with paybacks under 3x or minimum 4x with important impact for the business. It has been shown very efficient, and we have managed without a share of reached one under the initial project. And we're very excited about that and stimulated and we will continue with these projects that cause a positive impact in the environment and also competitiveness, high competitiveness of the company. And here, what do we expect from Randoncorp, the agenda for the next cycle, we will continue capturing the portfolio value because we're growing in several businesses, several portfolio in the last years. We will increase synergy among different business in different geographies, and Ricardo can talk more about that. We will continue to advance deleveraging and financial discipline, scaling resilient businesses. Our role is indeed to bring and increase the business that adds value to Randoncorp and simplify and integrate businesses. We grew a lot, and now we're looking to inside and simplify and increasing or improving the processes and having more synergy. And as I mentioned, to potentialize the return of the invested capital, seeking the project with a minimum of ROI, 15% and 18%. Now what we are building is not a reaction of the moment. It's a new phase, a new step in our history, creating more added value to the stakeholders. And also, we use this moment to thank all the trust from our partners and showing that Randoncorp even during a volatile moment in the marketplace and the challenges. But we look with respect to price competitiveness when the agri business has shown many, many challenges. Also, the political scenario as well is also volatile. The company continues to operate continuously. It shows its resiliency in an area that continues to invest. And even in this moment of restructuring, we will not shade away from investing in technology, in people and our clients. So I thank you very much for your time and attention, and I pass the floor back to Carol.

Now our second panel of this afternoon, we will hear the Executive Vice President and Executive and CFO of the company talk about financial discipline and execution of our strategy. Welcome, Paulo. You have the floor.

Good afternoon to everyone. Thank you very much for being here in person, and I'd like to thank those that are also participating remotely. Once again, it is an honor to share this moment and to talk about our strategy with you. My focus today is to talk about financial robustness. Here, you can observe that these are our strategic aspects. The goal today is that all these 7 aspects of these 7 points are very important. But due to this market volatility, high interest rate as well, I will now focus today on 3 of these points, raising synergy diversification with focus and financial robustness. It's important to talk about our assertive moment. We have reached a record in net revenue. We have grown significantly. Daniel has shown that talked about the external market revenue, EBITDA margin very resilient, but we are living year after year, a lot of volatility and the environment is that this volatility will continue. So within this context, it is more and more important to make investment that brings this resiliency, seeking more and more profitable businesses. Now these are one of the initial figures that I'd like to share with you. I previously talked about our revenue, record revenue throughout 2020 until the end of 2025, our revenue grew 20% per year. And basically, we started off in 2020 with 39% of the foreign market and replacement Brazil and 60% of the other markets. And now with BRL 13.1 billion, we have more than 50% more precise 54% coming from the foreign market and also replacement market. This growth throughout the year, it occurred abroad and also in the replacement market, which is inserted in this context and in also more stable economies. Over here, we see the evolution looking into our revenue in the foreign market. So it grew at a margin of 34% per year, starting off from BRL 1 billion in 2020 and reaching 2025, BRL 4.3 billion. And during this period, '24 to '25, we had important acquisitions, pointing out what we have added in Mexico that Anderson is going to talk about that briefly. So this revenue of the foreign market reached 1/3 of our revenue and also mainly because of the acquisitions that we did in the last 2 years. We focused on North America and also acquisitions in replacement market in Europe EBITDA margin, adjusted EBITDA margin. These are certain movements. On doing that, what have we saw throughout these 5 years? This is a volatile business, as I mentioned. Please observe that the line at the bottom shows the volume of trucks and also semitrailer in thousands of units. We started off with 158,000. We reached 250,000. We dropped to 191,000 and then 1950. From 2020 to 2025, our margin was between 13% to 15%. And in 025, besides all the global uncertainty and a very high interest rate in Brazil, if it were not the events unusual events that impacted our year 2025, we would have been above 13% in this margin. So what do we mean by this? It is that today, Randoncorp. is currently more resilient because of these investments that we did in the replacement market and abroad. It is also important within the assertive movement context, our track record of capturing and potentializing synergies from our acquisitions. Now we highlight here to the left, the investments that we did in the previous cycle. Please notice that we have Nakata,Castertech, Rands, Master, Fremax. So we had identified in the past in our business case, EBITDA of BRL 97 billion. This EBITDA in the fifth year already reached 3.7x. That is -- this really shows the creation of value. Here, in a more recent cycle where we highlight EBS, AXN and Dacomsa, we had an EBITDA of BRL 371 million EBITDA of acquisition and mapping and very much advanced the capture of twofold in this 5-year horizon. This is also quite an amazing value creation because of the assertiveness of the acquisitions. And of course, we have a number of challenges that we are indeed addressing, and I'm going to get into that detail and also Ricardo and Anderson are going to cover this as well. So the cycle here, we see the cycling of O&M market that really depends on investments, depend on the pressure of interest rate. As Daniel mentioned, we did mention a few years ago when we prepared LP that the Selic rate would be around 8.5%, 9%, which is the largest bank projected at the time. So unfortunately, we are close to 15%, which affects the decisions of investment and the markets. The maturing time of the acquisition that we did in the U.S., for example, we have with Frasle, the presence for a long time. But throughout the last 3 years, we've had acquisitions from Ecolis and the most recent one, AXN, but we really believe in the potential, diversified potential. Obviously, there were correct decision in this market, and it will recover. Now profitability of our portfolio also remind you that Daniel mentioned that we see our ROI of 15% and 18% and also the pressure of the interest rate and financial costs has impacted the marketplace and without a shadow of a doubt, our economic results. Now continuing on this important phase, it's important -- what are we doing to precisely overcome the challenges. We've had a number of adaptations of our structure that impacted our results last year. But what is very important is to highlight the magnitude of what we're talking about. We had over BrL 100 million in reduction of fixed costs last year and 43% less of fixed costs and also the assembler and also our improvement of our footprint. We took difficult decisions. We reduced 4 operations and also the stacking of raw material, generating a saving of BRL 55 million EBITDA since 2024. So within this chapter of addressing and challenges, I commented the American market, what is this history? And historically speaking, before the period '24, '25, the American market was countercyclical compared to the Brazilian market. But due to this instability, this global geopolitical instability, high interest rates and so on, this impacted also the American market. And also, as I mentioned, we have no doubt that because of robustness and the size of this market that is addressable of over 6x compared to the Brazilian market, it will recover and it will come on strong. And I'm sure that the investment that we did will obviously generate a number of fruits, partnership that we did in our consortium with investment with added capital of this amount of BRL 27 million. We also did a number of restructuring of our verticals. And also we did -- we've taken difficult decisions that I'm going to mention regarding the closing of operations and the discontinuity of portfolio compared to what I mentioned previously. We like to buy companies, but it is our role to reinforce our discipline in capital allocation. So throughout these years, we, in fact, took difficult businesses of closing operations. And then as you can see, we have all what we did during this period. There is a rationale of this disinvestment, of course. Obviously, I'm not going to mention each and every one of them, but these are, in fact, assets that we assess in all the cases, and we make decisions after thinking a lot over it and after a number of discussions. We sold Random vehicle. We closed the operations in Peru. We closed Fanac optimization of full operation of the automaker and a distribution center. And we now recently announced the discontinue of operation of Delta Global. So with the goal, obviously, that with more profitability of our portfolio, but this unfortunately impacts the current year. And this is what happened last year and is indeed happening this year because of this last decision that we took regarding the Delta investment. Now financial discipline. Well, financial discipline, these points here are assets that are under our control. Unfortunately, we cannot control the level of interest rate, but we can control working capital investments and also seeing the improvement of our leveraging. We always been -- this has been our goal, but we managed to reduce also, and we want to maintain this working capital at stable level, and we are more continuously analyzing investment, the prioritization, and we have seek to prioritizing investment with better return in a shorter period. The idea here is to see the level of leverage that we like to work with, which is under 2 months. It's important to say here that related to working capital throughout this year, this is the working capital for the final period. We had 76 days. Now we got to 50. And in '24, '25, we did major acquisitions and that place our working capital in another level. We closed last year with BRL 66 and this year, 66%, and we've been able to keep that. Always reminding that when we talk about cycle and days, it means that it's over 2 months of revenue, the figures. So the total is BRL 2.7 billion. So working -- optimized working capital helps us to improve our ROIC. Talking a little bit about this shorter period last year with the recent acquisitions we did in the end of '24 and in the beginning of '25, our working capital got to 100 days over 3 months of revenue, and we worked very strongly, and we could close the year with 66 days, and that's been stable. And what's the meaning of bringing to our cash BRL 1.4 billion with interest rate of 15%. It's highly relevant. Organic investments, we grew our manufacturing total area and our demand for investment also grew and also to keep our manufacturing units optimized, updated, always striving for production gains through investments. This year, because of our uncertainties and our goals of reducing leverage, we brought to our guidance a CapEx smaller than 2025. We continue investing. No doubt. We don't have any intentions of not investing anymore. But we are doing that in a more disciplined way as regarding capital allocation. In relation to our leverage from '20 to '24, we were under the EBITDA twice. In '25, we invested abroad in a way that we wanted to go from 19% to 1/3. We reached that target, but that meant a leverage that was a little bit higher until we can capture all the synergies and go back to the levels we want to be. As I mentioned before, in the past, we didn't imagine that the Selic rates would be so high for so long. Nobody imagined that, but it's reality. And because of that, we have to work with the leverages that we have control of. And here, we reported a leverage, a smaller one in the fourth quarter of '25. We were we were almost 4x in the second quarter of '25, and we are working for a reduction now, and we would like to go under 2x the EBITDA. And that's our goal for 2027. And this is something that we have been working on constantly. And we have no doubt that we will be able to go back to where we were before. So our focus is in generation of cash to reach those objectives. A few messages about long-term finance. Our priorities deleverage, cash generation that's going to help us a lot and a more disciplined allocation of capital. Our strategic pillars, our partnerships to grow with less need for working capital, the investments because besides what I mentioned before, our portfolio and the closing of operations, we have been evaluating all our assets and opportunities that we have to help us in reducing leverage. risk sharing through AVs, reviewing the revision of our portfolio and the dividends of our controlled companies also can help us in this context. and the ways of generating future cash flow. It's like aftermarket. It's always financial services, which are recurring, especially consortium businesses, they are highly profitable and very resilient with high or low interest rate synergies. Our track record is really positive, as I mentioned, and I have no question that we will continue potentializing those acquisitions we did throughout in the past years. OEM adjusted with cycle improvement in a way of -- in relation to structure and internationalization, we want to especially -- we want to be more present in more stable economies, being able to bring new stakeholders and other banks, other shareholders and also to have capacity to access capital and a very strong currency. That's it. I'll give the floor to Caroline. Again, thank you so much for your presence. Congratulations.

Congratulations for your excellent presentation, Paulo. No doubt, many questions that you ask yourselves on a daily basis were answered by Paulo. We will have a Q&A session regardless. Well, we are closing our first block of panels, and we are going to break. We'll come back in 15 or 20 minutes. [Break]

We are back with our Randoncorp 2026. So now continuing with our program, we're going to have our third panel of the day to talk about the strength of our OEM. The panel, as I shared before, is going to be presented by Ricardo and Anderson. So to start now, I call our Executive Vice President from South America, Ricardo Escoboza.

Thank you, Carol, everybody that are here. I'm going to talk about the strength of our businesses to the manufacturers of original equipment. Together with Anderson, we are going to be discussing topics. And when we talk about original equipment, we correlate with trucks. But I would like to say that in Randoncorp, they transcend the manufacturing of semitrailers. All our verticals, they provide solutions for original equipment. And as you can see here, we have the vertical OEM where we have the manufacturing of semi trailers. And we are proud to say that in South America, we are leaders of semitrailers, and that's completely connected with our auto parts that after decades, they still provide products for our semitrailers, unlocking businesses and providing commercial vehicles. We have the supply for all the supply of products for the OEMs in South America. And besides that, we have the control of movement where Anderson is going to be talking a little bit about. We supply for the supplier of commercial vehicles, passenger vehicles and OEM. We have financial services where we provide credit, consortium activities with the Randocorp Bank, the semitrailer and we have the white label for commercial vehicle manufacturing and agribusiness, agriculture machinery. We have advanced technology where we provide solutions and engineering tests our test field doing testing commercial vehicles, passenger vehicles and adapting products to our market together with the supply chain, all this ecosystem is integrated, and we provide and we reached the net revenue of almost BRL 7 billion in 2025. That represents almost 52% out of the total of Randoncorp in the supply of OEM, original equipment. This segment inside Randoncorp is really important because we have relationships. We have clients of our semitrailers that are also clients of our manufacturers of commercial vehicles. So we know their needs -- we generate value. We know what they need. We know their TCO and the acquisition of our products, the adaptations they need. And thus, we guarantee the best delivery for commercial vehicles manufacturers. And this is all connected. This is why it's really important. The levels of demand are very high. We have products with quality, sustainability, logistics in relation to commercial vehicles and semitrailers and in the channel of the aftermarket. Semitrailer is composed by the chassis and the box, the auto parts that are the undercarriage materials. They are all manufactured and they have this connection. So when we provide value in the supply of semitrailer, we end up feeding the whole ecosystem that's completely integrated. And a platform of industrial scale is our footprint in South America. Today, we are probably the biggest footprint to meet the demands of this market of semitrailer and auto parts in South America. The random OEM, we have over 3,100 employees. We have between the top 10 major manufacturers of semitrailers in the world. We have a net revenue of BRL 3.3 billion. We are in over 70 countries. And our businesses, our market, it keeps stable. It has been stable. We have had some oscillation, but our market has been stable. Of course, it reaches higher levels before. But as we are stable, that guarantees our safety to try and do things the same way we would like to. And we have been stable in the past 12 months. We are proud of being market leaders in the semitrailer market. The agribusiness represents 62% of this business. it went down 25%, and we went down 15%. Industrial cargo, 31%, we went up 15% and the other market that represents 7%. It's the fuel market went down almost 50%, and we went down less than that. This is why we say our leadership, our defense of leadership that retrofeds that ecosystem I mentioned before, feeding auto parts, control of movement and our businesses of financial services. This is why we must stick out for our position. Technology creating value. We have activities in many lines of our system. When we talk about engineering, creating value, we are acting in the sales meeting the demands of our -- and needs of our clients. Regarding raw material, we bring solutions. We reduce complexity and costs. And here, we have a few examples of the tipping, the sugarcane for Indonesia type of truck, the railway portfolio with railway for Arauco, a van for -- it's a new product, forestry, the by train or the fry train being produced by Randoncorp and the stainless steel tanks. For the actions we did in South America last year, the market went down, and we made some brave decisions. We adequate our labor -- we optimized our footprint. We closed 3 factories that were not adding value to our businesses. We had flexible journey, control of fixed costs. We did a one-timer in our vertical of BRL 90 million approximately, and that was essential for us to start 2026. And when we compare '25 with '26, the first quarter, we have a carryover of '24 after [ Finatrant. ] And obviously, when we compare with '26, we have like a small decrease. But as I showed before, the market remains stable. Even though we had a decrease, we increased our cash generation and we are in a profit position in South America, thanks to all of those activities we did in the previous year. No doubt, we have gains because of the reduction in working capital and cost control. For 2026, what we expect, it's a market that is stable within what we've been doing in the past 12 months. We have additional revenue of BRL 250 million with railway wagons. And now we start with railcars, and we also have Finatron with good expectations in November. That's going to be exports is something that we are -- we have been exploiting, and we have the MOV Brazil program for credit and for road implements wasn't being considered before. The railway cards, we have 721 for Arauco and 275 to be delivered in 2026. And we have 446 to be delivered in 2027. We have stability in Araraquara plant. We had to adapt it to produce semitrailers, and we have over 13,000 units delivered in our market. Exports, you can see that in many of these geographies, we have been growing, and we have been placing efforts as we have proved to be stable with the exports we have been doing for Africa, Chile, our market leader, Argentina has got a market and a by train. And in Indonesia, this sugarcane trucks, we can export even more of those in the future. This graph, I showed yesterday last year, the importance of the OEM in South America inside Randoncorp. When we check the EBITDA, there is a part which is to manufacture chassis -- we have EBITDA in auto parts, part of EBITDA in financial services and consortiums, and we have a small part in the movement -- movement control. That also retrofits the system and generates aftermarket. That's why the South American OEM is so important. Talking about auto parts, South America has over 4,000 employees, 14 industrial units, 2 joint ventures with Master and Jost, -- we are present in over 40 countries and a revenue of BRL 3.8 billion. When we look at '24, the projects, strategic projects were crucial to -- for this revenue resilience and to stay in the same level. Even with the market decrease, the 2 main projects, which is Master, our JV and ABS in the United Kingdom, this acquisition, they were crucial for us to be able to be more stable through the strategic projects, an increase of over 23% in the OEM in South America. [ Moiguaul ] is strategic for us. We started with Castertech and then we expanded to Suspensas. [ Moiguaul ] we inaugurated this year and we started activities last year with the provision of front axles for Mercedes-Bz. We want to be closer to the market to unlock our bottlenecks in Caixa do Sul, especially in Master Caster and Suspensys, being able to provide the aftermarket in a more sustainable way, and it's dedicated for the aftermarket. This site is going to generate BRL 1 billion in net revenue in our footprint of [indiscernible]. Suspensys is a landmark. We conquered -- we had the biggest order in our history of BRL 7 billion. We have a new portfolio of products, front axles. We started our manufacturing in February '25. And in August, we could supply 100% of our front axles to Mercedes-Benz in Brazil. We built this company in 8 months. We had like 500 employees involved. We have installed over 200 machines, and we have over 55,000 products delivered from that. This product we are delivering in August, we started this production. And in 2025, we delivered an amount of value 50% bigger than what we had projected. That was the size of the trust of Mercedes-Benz in trusting our competence to produce this product. Master our JV. We have renewed our agreement with 40 years of partnership. We renew our agreement for over 20 years. It's like a shareholders' agreement. Nowadays, it's not a contract anymore. So we have another 20 years of stability. We have an expansion of our portfolio. The initial contract was about drum disks and now we are expanding supply pneumatic systems for commercial vehicles and trucks, and we are exporting more for the United States through master or through our EBS plant unit. And with the acquisition of EBS, we go out -- we leave 18 to 25 in the European brake season, and we are present in more geographies with this company. We have plants in Romania, in Holland, China. And this is all connected. And then we expand our supply through the the TVS. Electromobility is one of our innovations. We launched the EVS trailer in 2021. Now we are launching the trailer EVS. We add inside our plants the solutions together with the IR and we develop these solutions, and we have these products in our plants. Cansformation and innovation that permeates all our operations, and it's essential with the new working hours for employees, the labor scarcity, it's mandatory to continue innovating and investing in automation in the OEM and the aftermarket, we have to grow and invest in automation through AGVs, supply of our lines. And here, we have a few of examples in quality, measurement, automation so we can supply our clients more and more. When we talk about potential and trends, we see a structured growth of logistics. E-commerce is going to continue growing. We can see the agribusiness also that's going to probably resume potentially with more strength than before, the renovation of fleets, expansion of our railway businesses -- and we are building these railcars and also the internationalization, capturing our synergies. So when we talk about the OEM and the auto parts in South America, we see these trends and potential. Now I invite [indiscernible] to continue talking about the OEM market.

I represent [indiscernible] those online. Thank you very much, rainy and Sao Paulo afternoon, but we are very pleased to have you here. I'm going to make my presentation in 2 parts. I'm going to continue with the regional market, and then we go to repair market, and Ricardo will be back then. Okay. So let's begin. Just for us to have this idea here, when we look to where our parts reach and they reach the world as a whole, Africa seems to be strange, but we have a very good reputation with the Randon brand, which is our automaker and also in the U.S., we have good penetration and presence in that market. And we always -- we serve our clients globally with Randon parts in several geographies. I believe that we like and also we like to bring a few cases. Ricardo bought a number of cases for auto parts. I'm going to bring one from [indiscernible]. For example, we have names of commercial vehicles and which is the PPW and which is South Holland, which is a global competitor for suspenses of accent, okay? So we can also send to our competitors. We have polymers with Honda, so brake pads and brake lining. We have also the disks and drums for our joint Villy plant being made available for our clients. I'd like to remember that a point that we are proud of and brings a number of responsibilities. We have 90% of brake lining, which is the origin of [indiscernible] over 7 decades. And in the South, we have a very important position in the market for heavy vehicle is in the Americas and 90% of the market in OEM makes us proud. This is not Brazil. This is Brazil and United States. So every 10 trucks manufactured in the geography with this system of brake has the lining manufactured in the south of Brazil, Rio Grande do Sul. We have others also other plants in China and India as well. Just to remind you from Fras-le B, it is 8% of the revenue comes from the original market. Fras-le has always had in its DNA innovation and the Vanguard outlook. So for the braking line, which friction disc and also we have 80 professionals with a lot of professional PhDs and doctors and masters with a lot of international partnerships, national and international partnerships with a network of development of advanced material in the world and the integration that we have with our center Randoncorp of Center of Technology led by [indiscernible]. To give you an example and light to this, Fras-le was the first company in Latin America to remove this reduce as we say, the asbestos and copper for the application in the United States, a legislation that began in California and antimonum. We are very much ahead in the marketplace. We were the first country to reduce the distance of for instance, the braking -- absolute braking of heavy-duty vehicles, and this was only managed with disc brakes. So we managed to do this with brake pads and brake lining dramatically poster gauging the disc brake, which would be negative for Fras-le. So that's why we have this huge dominance. And we are, at this moment, investing heavily what is regarding the emission of particulate for the European market more specifically. Since many have been reducing their emissions, the focus becomes on the brakes and tires. So we have huge and robust challenges in this direction. And we are preparing ourselves and developing this sense. We have new materials with several ESG. We have geopolymers replacing phenolic resin. We have our Maxi coating that is utilized in the geographies of low temperature, a lot of salt in the roadways, which is in the north of the United States, Canada, Scandinavia and European countries. We put nano embedded product in our 1, the coaching of Rax disks, and we have a very important appreciation of this technology, obviously, with price and positioning that our premium. Now going out from the Fras-le world, a case is already beginning. It is a start-up according to the size. We have like 1 in 4 months since it was acquired, which is AXN, which is not in the market with the favorable ones, but we have indeed made a lot of investments since we acquired it. We are transforming XN to serve the market when it gets back. Now the market currently is one that we serve with our portfolio of about 36, 000 axles with a revenue of BRL 45 million for this year. But we are developing all the portfolio for 100% of the trailer application in the United States so that our addressable market is BRL 1.3 billion for this plant. Additionally, we are changing our business model. We are verticalizing the production of what is possible to verticalize in that geography. The local content was 20% when we acquired the company with the acquisition and the localization of the painting, welding and several components, we already have 53% of the content of the axles being manufactured in the United States because the -- so the better for the local content so that we have benefits in the applications for our clients, obviously, with other things that come together with the reduction of geopolitical risk, expansion of the portfolio already mentioned, bringing automation, productivity, repeatability, safety and reliability as Ricardo explored very well. Now we also renewed our local -- our brand locally. When we consider Eircolis, we are not different. We have the same mindset. We want to increase our addressable market, and it is very concentrated in container chassis. The regulated model, 30,000 products per year. Although this year, we're talking about 700,. Just for you to understand the drop in the market, it was 300, 50 in its peak and the regulated market is 30%. Normalized market share would be 10%. But we are already currently for you to have an idea, we will produce this year 2,700 units, which gives a market share of 34. That was the size of the drop in the market that we are living over there. What are we going to do about it? We're going to launch the platform. It was launched last year. The clients are already testing it. We're experimenting the solution. We will launch Floresta. So the mission is to have the first part for the client experimentation. In the fourth phase, we want to launch the carry everything that we call without great interference in the manufacturing plant with a possibility of navigating cycles in each of these product category. Now leaving O&M, Ricardo and I go into the world of resiliency that is the world of repair, automotive consumption. Why to work for this market? Why do we like to work with this aftermarket? And why have we investing a lot in that? So I remember that since 2015, 2016, in several strategic planning cycles at that time, it was boosted by electrification with the uncertainty of what would happen ahead. We'd like to have a more defensive portfolio for transformations in the future. And one of the reasons is that the market continues, and I'm giving future vision because the Mercado shows the market continues growing 3.4%, more precisely 3.4%. This is futurism, but it is indeed 3% and 4% in the next 5 years. So this has been happening for decades. So with a great highlight where we are more presently, which -- in Latin America, which the growth is higher and in the Asia Pacific region. North American markets are more mature, so it's a more moderate growth and Africa and the Middle East because of capital, it grows less, but the market is extremely attractive. When we put billions of dollars, this is the market size of the selling of the selling of the industry to the distribution channel. I'm not talking about distribution go. It's the industry to the marketplace. So this is the size of the market that we are inserted into globally. So another factor that was indeed boosted post pandemic or during the pandemic is the aging of the fleet. When you can ask Anderson 1.3 years is very little, , 6 years is little, too little. So regarding light and commercial vehicle, that is a lot. This is the average. This means that our vehicles have an average age of approximately 30%. This is not only a phenomenon in Brazil, Mexico, it's a global phenomenon -- age more in Brazil than Brazil during this period. Just to have an idea. There is another factor, which is the cultural factor. Every North America has a new car and an old car in the garage. So the repair market, the aftermarket is aging. We need more parts on a daily basis. This does not change the market trends. None of the -- no study up to now has shown that we have reached the famous demographic boom. We have not reached the peak. We continue growing, and we don't know when this will be reverted. So this is why we say that we are in a market that is resilient. What did Randoncorp do? When I mentioned that we transformed in 2018, we only had BRL 1.4 billion related to the aftermarket. So this is basically it. In 2025, we already had 5.9% of revenue or 44% when you mention the total Randoncorp related to aftermarket. So apart from that, I'd like to bring -- say that each money that put in nonorganic growth, we bring organic growth because this enables synergy channels. You enable brands exploring other channels. You have leverage in purchase, you have engineering structure and [indiscernible] to grow in this marketplace. So if we grew 43.2% in CAGR with what we did, we grew 14.6 year in organic growth. This is value creation. So just to think about the brands that compose this dynamic. When we go into the Fras-le case, a company of BRL 5.5 billion, which is a strong generator of cash flow, we have it in the aftermarket. 90% is aftermarket. So in the past, we had 100% of friction. Now we have 40% friction. And in the past, we had a higher presence in commercial vehicles. Now we have 80% in light vehicle. The fleet now is the one that is circulating in the road, be it in Brazil and abroad. The potential market is in the light vehicle line and also most of it then is also international acquisitions. So what are the trends for the future? We talked about aging, and we're going to talk about digitalization in this aftermarket because there is a change in purchase behavior. The channels are bothering our climate. So this removes the margin. What is -- what effect can this bring to the free market. And this has been a concern on behalf of our clients and ourselves because it's money that can go from the aftermarket as a whole, but we are at a more comfortable position of -- in the chain, but we must be prepared to understand the signs to see how this purchase behavior is changing. Obviously, it's a technical sale. Of course, there are a number of challenges, but we cannot just sleep and wait for things to be developed in the dark, and we are not aware of that. So more logistic demand, cost of capital imposes that we have to have more stop churning. And also, we have to invest in technology, not only product, it's service and logistics. Those who do not have a core logistics will not survive the aftermarket. Maintenance is more expensive and more complex. The embedded vehicles is different from a decade ago. It's exponentially higher. So it generates more expensive parts, but the maintenance becomes more expensive. When this happens, then the mechanic does not risk to put a bad part in a car because if he puts a bad part, he loses all his work. So we have seen this in the engine behavior. 30% of repair is part and 70% is service. So the more expensive the repair for those who sell parts is the best. This is our rationale, and this is what we think. And the strengthening of the independent market. Everybody said that O&M will control right to repair, and it's got to be done at a deal. This is not going to happen. I state this because all the whole world, the independent channel is still the strongest one, and it has been growing for decades. The independent market has developed in the vacuum of the bad service that the dealership brought to the repair market and also because of abusive prices. This is not Brazil. This is worldwide. So it has shown that the stronger channel is the independent network. Consequently, it will grow. So this market will not drop because we check the part, and we don't see the future of it dropping in the future. Now how has Fras-le prepared itself for this market? It has 33.5 SKUs. It brings a complete solution for repair. The wheel 100% -- so I say that we have 100% of the portfolio. But it would be too much saying 100% will be too arrogant, but one of the parts, some of them we don't want because it cannot be repaired or we don't have market for that, but others have also gaps of opportunities to be developed. And another point here that we are advancing very fast is regarding the technical information. Frasle was the first company in Brazil to launch search for plate. For example, we put the QR code for you to use it because please feel free to use it because you go to auto expert, you put your car number plate and you see every part Brasil mobility available for your car. So exponentially, we have user sessions in our platform. So with the exception the retail market, we would have the second marketplace, most popular one in Brazil. Here, the our information training and seeking for number paid loyalty experts club, where we put p to register their invoice, you generate a coupon for cash. Everything is generated on the platform. We have technology team also developing this product that is not monetizing, but it's already becoming loyal. So we are present in all these geographies. Capillarity is essential in this case. Your part must reach to the end customer. So availability, supply chain, we delivered to 1,300 points in Brazil. We have supplies to 65 O&M for over 4 decades in this market, the capillarity. We have industrial operation in 100 countries with a presence in 125 countries. Now as level of service is essential, the growth in market share in the last year have had a big growing demand for the service because there is a lack of mechanic experts in the marketplace. So we have to cover these gaps of knowledge. We're being acknowledged as a brand of trust. So -- and also the NPS, none of our NPS research is under 80. Just for you to have an idea of all the brands through one of the media, this is the mechanical from Ipsos Research Company. It's located in Sao Paulo state, see how our brands appear in several product categories. None of them are under the third pillar position. So we have a number of brands where we navigate. And lastly, where are we headed to? How do we want to grow? Our priority is synergy. Don -- knows it's a huge project, a relevant one. We have half a year to capture everything we want. And we are working very strongly to work with the addressable market because the success of our market share, we have pressure to raise the market. The success of the past is the problem of today. to increase in the market, we have to take a broader portfolio to new geography or M&A and acquisition model. So with a mindset of asset-light with the return of the capital that is invested level of services, as mentioned, we are -- it is growing. We will not change, but with a lot of intelligence in allocated ple contributing for deleveraging both for Randoncorp and in a more short term. I thank and invite everyone on the 26th of August, we're going to have Fras-le Universe in Extma in our [indiscernible] operation, where we'll be able to see the [indiscernible]. Thank you very much. I return the floor to Ricardo.

Congratulations, -- and just to complement a few information about the aftermarket and the OEM OEM. When we talk about the OEM, obviously, our dealers, our network of delivery, our strength, we have over 93 points of service in Brazil, 115 abroad that strengthens our position with semitrailers. We have 1.1 million semitrailers of active fleet. We develop products and solutions together with our dealers to meet the needs of this market. So inside the OEM, we have showroom and we have all the activities that are essential to serve this market and to have this share in our OEM. When we talk about the vertical auto parts and the products, products for commercial vehicles, we talk specifically about our distribution center just inaugurated in [indiscernible]. We unlocked bottlenecks we had in Caixas do Sul, where we had to compete with the replacement products and original ones. So now we have a dedicated one with concepts of delivery that are more optimized and fast so we can serve the whole aftermarket and commercial vehicles. We have a lead time because of distance, more availability and more delivery. We inaugurated in April 2026, and we are already -- we have a major quantity on a daily basis of master the Caster of income. And it's also worth mentioning the European brake system, the EBS is part of Master, our joint venture. It has a global capillarity. It's 100% focused on 99% focused in the aftermarket. We have been learning a lot from this operation in the U.K. Over 42% is for the U.K. market and the rest -- it's distributed in the U.S., China. It has a global presence. And it's bringing products to Master so we can act in the local market and over 10% of the aftermarket of Master are with EBS items. This is the concept Anderson mentioned before. It's -- this is the way we unlock synergies and create value in our acquisitions. And here are our distribution centers we are creating in Spain, Dubai. It's a little bit on hold because of the war. And we are doing an upgrade in China in Ju. We have over 45 SKUs. Master, as I mentioned before, had 1,500 or -- and with EBS, we have 45 SKUs and we have next-day delivery. If we -- someone places an order today, we have 24 hours to deliver to the whole of U.K. And this is fundamental. This is why our distribution center is at [indiscernible] because we have the needs and we are unlocking this new concept of next-day delivery. And we are using AI in our sales of EBS. We developed our own concept, and we're going to be replicating that to all our auto parts in South America.

Thank you, Anderson and Ricardo for the explanations. I reinforce Anderson's invitation to get to know the plant units. Every time we visit them, everything we learn becomes more tangible. We are going to have a site visit at [indiscernible]. We are just organizing some time so you can visit and get to know it. We are right on time, and it's easier. The mission of our next panelist is Eebanaleti and who Randoncorp.

Good afternoon, everybody. Thank you for everybody online and in person. We spent the afternoon listening about the strategies of the company, financial discipline, execution synergies. And my mission now in the next 10 minutes is to try to summarize in key messages, but I would like to allow myself to do it in a bit of a different way. I'm going to bring these key messages telling a little bit about how we are, how we are behind the curtains. So we are relentless. We have the capacity of transforming and we left from 14 to 33 companies in the last years, we duplicate the number of factories. We have over 22 families of products. [indiscernible] mentioned that we added so many SKUs in our portfolio and how much of -- that's a solution for our clients. We have 5 international acquisitions. And with that, we met one of the objectives we had to expand the share in revenue with over 30% of our revenue, it's very strong currency. Carol just said, we just inaugurated the last Suspensys factory in Moiguaul. It's a very modern state-of-the-art relation to technology. We have a new distribution center also. And we are making advances with the logistic efficiency that's very, very important. And that stands out out of the competition. And with all of that, we have over 45% of our revenue coming from the aftermarket. And service market also there, I would say, is the defensive side of our product portfolio, and that shows the transformation. These were restructuring decisions and execution capacity to make us to face another level of growth in the company. In the beginning of the day, Daniel and Paulo, they showed our revenue in 2020. It was over BRL 5 billion, and we are talking about BRL 13 billion, 1/3 of our revenue coming from abroad, 46% of the -- in the aftermarket. So it's important that you have in mind how much we are well positioned for the next cycle, and we are relentless. We face crisis as opportunities again and again and again. And as much as it's necessary. We don't hide that 2026 is being a challenging year, just like 2025, it was just like the '90s and the '80s. But we took these opportunities, and we always came out of the crisis in a better shape. We are facing a decreasing in the sales of trucks and semitrailers. The mix that we are selling is not the most favorable one. We are facing an environment of high interest rates. We are facing temporarily a leverage that's higher than what we would like to. And that's the fruit of all our investments and that they were crucial for us to have less impact in the current market. And with all of that, we are facing -- and as I said, we're not here just standing up and doing nothing. We've been working hard, and we're starting this year, we have a carryover of debt we could reduce the cost of capitation. We have increased the midterm. We have acquired the equities market also. That shows the efforts. And the most important thing here was the working capital. We brought BRL 1.4 billion, Pala together with Paulo, we worked in all of the fronts to be able to do that. It's not a small effort. In 100 days, we went down to 66 days, and we made many structuring measures that we are carrying throughout this quarter. And with that, we try to reduce leverage, and we have the expectations of 2026, working in the basic 2 lines, reducing debt, increasing cash flow and searching for synergies, increasing EBITDA and operating efficiency. Also, we are -- we don't conform with this scenario. We face it, we act. We talked a lot about restructuring, but it's also important to mention about the cargo contingency -- I'm sorry, CapEx contingency. We don't negotiate safety in our operations and production capacity because when the market goes back and it will, it will come back. And we have to resume the market. But again, we are not waiting for things to happen. We are protagonists. We announced in the beginning of the year, the highest contract ever made in the sales for Arauco. That's the major batch contract of semi-trailer in the United States via Hercules. And with these deliveries and with that product quality, we could expand this contract in another 1,000 units for this year. And we are also reviewing our business portfolio. We mentioned a series of the investments. We are not used to that, but we are willing to face difficult decisions as a way to improve the efficiency of the company and deliver more value to the society. We are protagonists. I don't know if you all know that, but 100% of our trucks that run in Brazil, the heavy-duty trucks in Brazil, they have at least one part produced by us, 100% of the trucks. When we talk about it, we forget market share. We are measured by the commitment we have with the country, commitment with the clients and with society in delivering safety and quality. I don't know if you have positioned yourselves in a situation where you can see a semitrailer from random. And you are traveling with your family and you think nothing can go wrong on the road, on the freeway. So we have this commitment with safety with society as a whole. And for us, protagonism is not measured by size. It's by the impact we generate in other people's lives. And this is nonnegotiable also. And we have the future. We talked a lot about investments in new patents. It's for the third year in a row, and I'm going to reinforce that again. The market people don't know, but we are the third biggest group of registering patents. We are just behind Petrobras and Stellantis. And I would say with low investment level in PDU, we have been extremely efficient with this research and design. And we are not just doing that for nothing. We look at product organization, production, and we have improved the female leadership in our company. It went up from 11% to 22%. We generate recognition of the market, and we bring some of the awards. We never do anything to get awards. And that must be just a consequence. But when we are awarded, it shows that we are walking in the right direction and that strength our outlook. And that is what makes up the Randoncorp. The purpose of this slide is try to show the gap of value that is significant in the market, and we bring a comparison here of the equity value compared to market value. And this bar is probably a little bit smaller today. And we understand that because of many factors, we are going to deal with that in the Q&A. We have crossed the storm. It's important to demonstrate and we did the necessary actions. We improved our operations in the first quarter, you could see the results and to continue with this discipline for when the market resumes, we are going to recover these margins. We are working with uncertainties, political, economical, global conflicts. Even if you have a strategic plan, we have lived with high interest rates that are pressuring our net profit, not favorable mix of products in Brazil and less demand in the United States. That's -- those are the factors that create the perfect storm. On the other hand, we have leverage for growth. We were very well succeeded with our acquisitions. we have to look at what's challenging, but also we have to value our gains and to -- and because of the strategy, this is the result of the strategy in place. There is leverage combined with the reduction of interest rates, that's going to help a lot to bring value. And internationalization, if you knew about the international market, would you have changed your strategy if you knew about the market was going to be in a bad scenario. And the answer is no. We are going to continue investing in our expansion abroad. We are not tired of mentioning that the most resilient businesses, they have gained relevance because of market volume focus and strategy. And also, there is a correction of valuation that will come up. The investment market will come back and it will be more rational. Just to reinforce and to say that we believe in a significant generation of cash flow, not only for shareholders and investors, but also for the society. That's what I had to say. And before giving the floor to Carol, I would like to thank the IR team and the marketing and all the organization that prepared this beautiful event, logistics and curatorship of materials that were really well thought for you. We would like to listen to the feedback also. So thank you so much. Thank you, Carol.

Congratulations, Steven. It is my boss, and I'm really proud of it. people, we had 5 panels where we could understand about Randoncorp, the businesses and the times we are living now, our strategy and our future. And now we are going to start the Q&A session, and I ask you to organize yourselves and participate so we can interact and we can -- if you are online, you can also participate via QR code so here already. And now I'm going to invite the floor all the panelists for the Q&A session. And to be the mediator difficult questions go to [indiscernible]

We will now begin with Q&A session. And we had a lot of interesting content throughout the afternoon to share with you. So as Stefan mentioned, there were topics that we are recurrently being talking about, and it is now being close to our Executive Committee, I see, we have Cesar and Marco here as well, who will eventually -- if there are questions, we can -- we know we can count on you and Stefan to help us here to do all the context that's necessary. If you have questions, raise your hands and several hands already, we see here. So Gabriel Rezende from..

Thank you very much,. I'd like to go back to a point that Daniel and Paolo mentioned and David at the end regarding portfolio management. We saw a recent movement of disinvestment of Delta, and you talked about strategic movement saying that we had difficulty, but we still have a long-term strategy, the exposure of international market. Now I'd like to hear more about that, what have you used as a criteria to define eventual disinvestment, ROI, maybe synergy with other businesses. Did you notice that the cycle and depending on the geography is a little bit more attenuated more than you expected. So I'd like to understand what the company has used as criteria for this investment? And if there is any segment or geography that the company has noted that it's worth while taking the foot from the accelerator.

Well, Daniel and Paulo will address this topic. But Steban also, I'd like him to talk about the squads that we've been doing that will connect to what Paulo and Daniel said. I'm starting off with you.

Thank you, Gabriel, for your presence and the question. And firstly, as we said, Randoncorp had a very strong growth in the last years. And at this moment, the company is looking to inside is the opportunity to revisit all the businesses I think, generally speaking, we were very clear regarding the search for all the business that we see in the marketplace with more resiliency on our behalf and also talking about mobility ecosystem where we could add value, synergy and increment in the portfolio. But these are businesses that we believe that are strategic for us and being the minimum return ROIC and ROIC for Random Corp. So now we have revisited and what can we do more and us internally or many times, we have to have a partner like hands and seeking for the investment to look into the moment of the consortium and while the market shows favorable wins. For each model, then we are also revisiting our vision for future until 2035 in terms of planning so that we can use this moment -- increase our margin return and resiliency as Pontal and Ricardo showed in their presentations and also the potential that Randoncorp has. And also point out that projects that we had certain parameters that is not showing the expected return, we have demobilized and decontinued or even put other partners that can have more more synergy and for this business. But the main thing is to look at our business in the middle and long term and also considering the mobility ecosystem and the minimum return and resiliency. Well, regarding our portfolio management, there are 2 aspects when we talk about this investment. One is a category that Esteban can talk a little bit more, and it is a squad that Esteban leads. These are assets like plots of land that are not being used for no production operations specifically, but that a company after 80 years in a way or the other in previous negotiation, we've then received this plot of land and we're thinking of selling them. So in the acquisitions that we did in the last years, most of them, we ended up buying the asset, the mobilized asset, but not the land because the land actually goes on the other side of ROIC. So this is what we've done. So regarding operational portfolio, we're going to explain how is our decision-making process for the operations abroad. There might be a change in legislation and the company will be unable to pay dividends, for example or economic and political instability of that specific region. So due to this, we ended up deciding to close. The operation in Peru and our management regarding M&A projects have been done in more stable economies. As I mentioned previously, North America and Europe were the last acquisitions that we did. So at this moment, looking to the operations abroad, we have no intention of discontinuity. When we look to our portfolio in Brazil, the last example was the one from Delta. Since we did the initial acquisition through Randon Ventures, we have seen this as an asset and an important business that could bring more competitiveness on behalf of the monitoring that we call Randon Smart, which is the monitoring of the vehicles, telemetrics. But this market has shown itself very informal with extremely low margins and we made several attempts throughout the years to -- so until we took the difficult decision of discontinuing the operation. This has been our rationale when you talk about foreign decisions and our portfolio in Brazil, but this is continuous and constant. And because the market conditions, they change, and we have to do in our planning and budget and strategic meetings, we have to check if our assets are competitive. And for the ones that we do not feel that cannot become profitable, then we have to make the decision for discontinuity. Do you have anything else to complement?

Yes, I do. Thank you, Paulo. I would just add 2 points here. I believe the first one -- this investment is part of the rationalization of the portfolio. The worst thing is to be blind insisting on something that didn't work. So we -- it's important to be humble and acknowledge this and change the track -- change the route. So besides this investment squad, we have other 4 that's been working with peers with the goal of increasing revenue, reduce costs, looking to the structural costs, looking to hire services, contracted services in order to increase efficiency. Every company is organized in a transversal way as well. The director that is leading this revenue squad, for example, is from the automaker, but is looking transversely to all the opportunities that we have inside Randoncorp. So the same thing for the squad as well.

Now, next one.

My first question is more focused on auto parts. This is more about the evolution of the margin. The first quarter, we had an increase of 3%. But I'd like to see other vectors focusing more in the plant in Mogi, how has the evolution been going? And also AXN regarding portfolio and in what stage we are and when we can see this improvement in the margin? And a second question, more focused on the reduction of fixed costs. You said BRL 110 million reduction in 2025. I'd like to understand a little bit more if there is still space to be acquired -- for acquisition in 2026. What are the main factors and what has been done in this sense?

Thank you, [indiscernible]. The first part regarding auto parts, I think Ricardo can talk about that. It comes in a context where the end of last quarter of last year, we had more pressed margin for auto parts, and it is connected to the macro scenario and the adjustment. In the first quarter, we then -- we now can see we can advance a little more that shows a more normalized level of auto parts and also the sequence of feed cost, Paulo, I'm going to ask you to talk about that. We have made other initiatives, a huge effort and -- but we also want to seek more. So Ricardo, and then I'll pass the floor to Paulo to answer the second question.

Okay. Thank you for the question. And I think I'm going to share the answer with [indiscernible] and just to organize it. Regarding the auto parts market, aftermarket, the last quarter of last year, the automakers had a very accelerated inventory, and we took decisions regarding the semitrailer reduction of working capital and also the reduction in the working period. So we have a complete lineup. We have light and semi heavy vehicles and heavy trucks. The heavy trucks, they dropped throughout the trimester and then they took a more aggressive decision in the last quarter because of working capital. This affected our auto parts aftermarket. And now we begin the year with a certain stability. The same graph that I showed regarding the semi traders is the same one for the truck. When you talk about the record for truck, it was [ 200,000 ] 2030 prebuy, we had [ 60,000 ] '23, '24. And currently, we are planning 110,000 trucks if we look at the complete lineup. Now this is a stable market that we have to take structuring decisions in the company in the vertical aspect. So -- but what the share of that with the business that I showed already maintaining a resiliency in revenue, adding more synergy to the acquisitions. Mogi Guacu topic as well. It's not for the regional market, but also we have something to unblock the aftermarket, which in Caxias do Sul. So we see a potential for growth without a shadow of a doubt with the structuring activities that we are taking. Regarding footprint, we had 2 buildings in [ Resenio ], one that we use with Volkswagen and another one that we rented, the one that we rented, we did the disinvestment end of last year. So these are strategic decisions so that we can make our business profitable inside the aftermarket segment. Now talking about AXN Anderson.

Thank you very much, Daniel, for the question, Ricardo, for your answer. AXN is a bit what I mentioned. So we acquired this company in February. We acquired a stock and inventory that was in that operation. We managed to reduce this working capital significantly and soon after that, the tariffs came. So we did a new renegotiation with the partner at that time. We found other providers in the American market. We did several market tests to supply as of Brazil, we redefined the supply chain, and we did the investment in 6 months from the approval to the inauguration of the plant, Daniel, I was there in March. And we are also renewing our inventory. We have to do an anticipated purchase from the acquired to manufactured. So I can say that we are seeing the evolution of this result month by month. We've already went past the breakeven point. We are not eating our cash even with the market levels and values that is actually low. Well, regarding profitability, it already comes with the market in low. So the contextualization is got to do with the development of the portfolio that we do. Now to leave the addressable market of 30,000 semitrailers, so the market is 230, 240 when the market regains, we want to have this portfolio distributed. [indiscernible] hearing us. He's working strongly in the commercial area. We put a very experienced team in the field. So when we do the inauguration, this amplitude of local content of 33% call the attention of large trailer manufacturer. We had a very good advancement and the niche is very preexent. So we see a very promising horizon, especially with respect to what we are doing and what we have, we're strongly reducing the breakeven of that operation.

And good to listen to you. The potential of the United States is really big. So Paulo, I'll give you the floor to talk about opportunities that we have to reduce fixed costs.

Thank you for your question. Firstly, the most -- the easiest thing to do is to reduce costs, but you have to do that without compromising the future of the company. During most part of my career, I have seen situations where top down, everybody has to cut 10% of the cost. And if you cut that from the supply department or the sales department that we're not selling, that's not what we do. We don't want to do that. We don't want to cut this type of cost. Last year, we started with what's basic. We are talking about consultancy, travel expenses to freeze contracts. We have to continue doing that. That must be constant. But today, our discussions and Cesar is leading that initiative, we believe in the initiatives of automation and AI. Since last year, we created a work group called Brain. And we started a few projects, pilot projects that aim at looking at all the administrative areas, more transactional ones and to check opportunities that we may have to have productivity gains. We cannot estimate the greatness of this type of reductions today, but it's something that we have worked -- have been working hard. And as we mature in relation to this project, we will be able to share with you that. But for all of that, it's been really interesting. We created the squads and we have representatives of all the verticals and companies and all the departments and areas. And it's a construction something we have been building out. It's an experience exchange. We have standards in some companies that might be shared to other companies, internal benchmarks. This is what we have been doing and challenging the teams to bring new ideas so we can reduce the fixed costs in a structured way. That's our main goal.

Congratulations for your presentation. We've been following up the company for over 2 decades, and we know the many challenges Randon has been through and that they were all overcome -- so I was in the airport. I met Oscar Schmidt and we were talking about the past. I would like to ask Daniel about a strategic vision of the company in a way that there are a series of structural changes in the automotive industry. And I would like to understand a little bit more how Randon wants to position itself in this world where you have a growing presence of Asian automobiles that are representing almost 20% of our local sales. And how do you think you fit inside this change, this change of gravity center between Europe, United States, Brazil, losing space for China where we think is the new gravity center in the future. So we have high interest rates. We have changes in interest rates and possibly, we're going to have a scenario of high for long. If this scenario of high interest rates materialize, what's your plan B for that?

Daniel and Paulo, if you eventually have a complement to make.

Thank you for your questions. It's great to remember after meeting, he was in the IR department for a long time at RandonCorp. And again, in times of crisis and cyclic times, we have been through all of that. So looking at the market and [indiscernible] and Ricardo, they can talk about the light commercial vehicles. But in relation to Brazil as a potential market, we are talking about a volatile market nowadays. In May, we were in New York at the Brazil week. No one was really worried about elections or other things about Brazil. But when you look at things in the long term, when we talk about energy safety in Brazil, when we talk about food safety, Brazil is also #1 again. We have many -- when we talk about geopolitical issues, it's Brazil. When we look at these 3 aspects in the long term, we have rail land and potential for infrastructure, we have many projects that are still -- when we look in the long term, we see investments that are important. And I understand that when Brazil resumes and when it starts to be more solid, sound, I'm sure that investments are going to come back to Brazil. We are highly critical, but even if you observe the [indiscernible] Brazil is the country. We have a high potential. And it's a very interesting market for new entrants. Chinese are very strong in the light vehicles, and they are going to heavy-duty ones also. So we have this capacity of observing the whole market. We have grown not only Randoncorp is global in auto parts. We have 2 joint ventures with North American partners and German partners, and that position us globally where the main manufacturers are. When we look at commercial vehicles, when we consider Brazil, if there is a demand for production in Brazil, in the midterm and long term, maybe the federal government will maybe tend to create barriers for imported products. We'll have to invest in the local industry. And this is -- when we look at local production, we are well placed in relation to competitiveness. So we are a Brazilian market. We are increasing our international market and aftermarket. There are new entrants, but the aftermarket, it's a long-term market for the products that are currently being sold. We have invested a lot in disruptive technologies, and we believe that we are going to continue investing and bringing nano technology and paint cast products that are more resilient, more efficient in the industry. And then we can go to the external market with this product. And we also invest in the channels with clients. When you buy a semitrailer, for example, from Randon, we have the system, we have the bank, we have the consortium, we have the dealer, we have partners. We have a capillarity not only in Brazil, but in United States also and all the Americas in a way that we can be more competitive. Pontauchi wants to say something about the light commercial vehicles of the OEMs.

Thank you for the question. I'm just going to give you a context about light vehicles and electrification. The energy transition has many questions and not many answers. But we declare that regardless of the propulsion system, we are going to navigate in the aftermarket in a very positive way, in a reactive way because we are protagonists. I want to have aftermarket solutions for our products, even if they don't have any consuming 30 days, we want to be the first ones to put items in the shelves on the shelves because we want to create brands and have brand presence with our clients. In 2015 -- 2016, when we started our Fras-le strategic planning that was focused in brake systems. We knew that related to braking systems, we would -- that would be -- that would decrease with time, and it didn't happen yet. The fleet grew and of course, the electric vehicles have increased. But electrified vehicle, hybrid ones, it's one thing, purely electric is another thing. And we have to observe what is electric. It's 4%, 5% of that 11% that we saw from last year. If I consider the sales of last year, this 4% we have to be more careful with. And we were prepared for that because when we created Nakata, we knew that electrical vehicles were heavier and they would demand more from the ground vehicle interactions. So our engineering engineers had to work harder. So we have high-ticket products. We have parts that are favorable for electrification and others not in our portfolio. And if you look at the company in the past, the suspension line is the one that grew the most. We invested more money. We have a new factory, and we produced more. we are like 167,000 shock absorbers per month. And last year, we sold 476,000. We know that there is a future there. We have planned for that long time ago. Of course, we have been observing, but we are making advances. And another thing I would like to say and it happened in other markets, when it's a decreasing market, it will consolidate. The bigger will eat the smallest and the smallest will disappear out of the market and absorb margins. You have to be big and relevant in this market. You cannot be small. By separating categories, manufacture of commercial passenger vehicles [indiscernible]. So we have more [indiscernible] one cannot subsidize the other. [Technical Difficulty] So I pass the floor to Daniel. The second question for Paulo. If the interest rate, we have the CFO here.

Thank you for the question. But -- this is a topic that we discuss every day. Many times, we lose sleep. But I believe we have to work with our feet on the ground and focus on what we are able to control. Of course, we cannot control the level of the interest rate, but we can control our costs, our investments and our working capital as well. So when we build the plan, we have worked so that we can generate free cash flow without a share of a doubt. And this is an important element that helps us to reduce our debt through the operation, disinvestments, through the selling of assets. So this is what we have sought. But many of the times, selling assets [indiscernible] it cannot be done at any price. So the business that we did with Patria in the previous year was something where we discussed for 2 years. It was a valuation that at the time, we considered it fair and the business then went through. So what can we control? What else can we control? Inside our financial discipline, we maintained our AAA rating throughout the last years, we have managed to sort of lengthen the profile of our debt, so reducing spread, increasing the medium time line with credibility. So what we say, we do. So this is under our control. And if the interest rate remains higher, even with high interest rates, we can always assess the opportunity in the capital markets. We did the follow-on on France. We did a raise of private capital with the controller Randon family. They committed to increase or raise their participation, which helped in this context. So these are alternatives that we always assess -- are always assessing. And there are points that only depend on us.

Could you comment about the M&A scenario you might be facing a trade-off where M&A for Fras-le Mobility this spring showing the organic and nonorganic, but there's also this effort of the level of leveraging and how can you manage to reach this fold, reaching 20. I'd like to understand your mindset regarding this decision, if it's the size of the opportunity, what is more considered the leveraging?

Thank you, Malta, for your question. In an M&A cycle, as we usually do, -- and moment we are not doing making acquisitions, of course, there are always conversations about it, but there are moments in the company where this obviously interferes in our decision. But I'm going to pass the floor to Stefan. I think he can address M&A topic and the deleveraging of the company and how we can match these 2 things eventually.

Thank you, Malta, for your question. We have to balance the goals of deleveraging with the idea of growth and continuing growth. at this moment, with this interest rate at this level, we will prioritize deleveraging. Of course, in the midway, there are opportunities that appear that you have to consider. We've got to stop to think and make a conscious decision. So when we were deciding for the acquisition of Done, a relevant case, it was released in June the scenario was of 8% to 9% interest rate at the end of2025. And there was a moment in December where we needed to make a decision if we would follow ahead or not, even though we knew that the interest rate would be higher in 2025. It was a horse that was there, and we didn't want to lose this opportunity and open space for competition. So we probably -- and certainly, we would lose more than we would gain if we didn't do the acquisition. So what I mean with that is that we have a rule. Yes, there is a discipline of seeking this deleveraging, but it's not a blind one. We regard other movements that can indeed become strategic. At the end of the day, you have to look at the long term of the company. And another point, as David mentioned, the conversations take time to materialize. So in many of our cases, M&As that we announced took 2, 3, 5 years until we manage to finally reach a consensus. It does really depend on the M&A timing. So financial discipline will be maintained for future decisions.

Okay. Andre Mazini from Citibank. My question is a follow-on regarding the simplification of the company. On one side, you can see that you actually diluted OM of 37% in 2020 to 37% today, which reduces the risk. But as Stefan mentioned, this is more with respect to invest in deleveraging. Now looking ahead, what is the end game in terms of segments and geographies you want to be in? And how does this converge with the goal of 15% of ROI, maybe the time frame to reach this ROI? And how do we see -- when will we see the company in a more established or stabilized ahead in what segment, what geographies? And when do we reach the 15% ROI?

Well, I'll begin with Daniel to do a broad context of this question, but eventually, Pontal and Ricardo can bring more relevant with respect to what they are analyzing in the vertical so that we can do this change that we've been doing in the last year and making our company more resilient and stronger. And a lot of what we did, you could observe that not only regarding the figure, but the behavior of the company has been ongoing.

Andre, thank you for your question. What we have worked on historically is seeking a ROI minimum of 13%, minimum of 18%. So what we have looked at regarding the strategy in the last years is to increase our participation in North America, looking to Mexico, United States mainly and to continue growing in Brazil and in Latin America. We have also had the opportunities in Europe, more specifically in the aftermarket, mature market with strong brands. Pontal and Ricardo will mention about that as well. But our vision point of view is the opportunity. Historically, we had a growth in aftermarket, auto parts that Ron, the automaker, we see that we've done all the investments as Ricardo showed the largest acquisition of wagons that we have ever done or supplied by Randon over 700 wagons in an acquisition. So it shows that the company continues to invest, invest in Araraquara to have more capacity of delivering the products of the automakers. So the opportunity we see in America, we have more capacity, but we also have sought we're looking to partners, both suppliers and others from Asia and Europe that has helped us to have more competitiveness to be more competitive and to choose our projects better. So our great challenge is to continue seeking productivity and be more assertive in M&A that adds value for the whole mobility ecosystem portfolio and business increment for us to have this 15% return in ROIC, 15% being very objective.

Lucas from XP. Regarding ROE and ROIC, Stefan showed that in his presentation, the market gap with this -- the market doesn't pay the ROI of 18% because the capital value. Now thinking about the evolution of ROI, 18% ROI, thinking the structure of capital, how implicitly are you incorporating the debt? And how much does it depend on the monetary policy that we discussed, which is more difficult and out of the control of the company? And how is the capital structure? And how is it with the capital structure and the equity? What is the side of this restructure that we have to think about in what we have in terms of capital structure? So ROI was running at 4%. This is what we discussed. The market, the return worsened and the cost of capital went up. So thinking more about what is controllable -- and you have shared a number of initiatives regarding cost reduction. But how much is this 15% ROI in your hand, this reduction of cost or reduction of this denominator? And the other part is sectorial. So it's got to do with the ROI and ROIC, but to understand the financial asset of ROI and the operational ROIC. So the rest is in the market's hands, of course.

Thank you, Lucas. I'm going to make a question with Paulo and Stefan. Looking to the past, the path where we are on today will lead us to the level that Daniel mentioned in his presentation now. But Paulo and Stefan, I think you can bring elements to collaborate with the answer that Lucas made.

Thank you, Lucas, for your question. how do we think? If we look at ROI, the service of the debt today is very heavy. So we're talking about an interest rate, let's round it up to 15-plus spread, 16 then. So if we believe that this level of interest rate will remain forever like this at this level, we all have -- know how to do the math. This 18% ROI will never be reached. So it really depends on what we believe with respect to an interest rate, which is future structurally, 8%, 9%, 10%. So a great part of what would be the return for the shareholder is going to the service of the debt. This is a fact. So sincerely, structurally speaking, we do not believe that this interest rate will continue as high as it is for a longer period because it is suffocating, struggling most of the companies, and it is compromising the return for the shareholders. Of course, this is part of the thing. Now the other part is also linked to the improvement of the ROI and ROIC, which we know that the automaker has an asset base that's very important. And we are suffering with profitability from the automaker because of the market. So the market and the kind of product that's being produced that naturally has lower margins. So we believe that at a certain point, this market will get better. Another important element as well is that Hercules and AXN, they were M&A operation, mainly Hercules that has an asset base because of the acquisition, it is very important with an expectation of improvement as soon as the market regains of what it was. We look at auto parts, aftermarket and Fras-le, you can do the math. You see the level of ROIC, which is higher. So in a nutshell, -- these are the lines. But what has really impacted the ROIC last year and this year is the income rate tax. So since we are having this more adverse market of the automakers, the debt is heavier. It also generates fiscal loss because of accounting, we are not considering what is deferred. Obviously, it's off balance at the moment that this interest rate goes down and the market gets better, we will be able to bring this benefit back to our DRE.

Thank you, Paulo, and thank you, Lucas. I would summarize it in 3 actions that are inside our reach. excluding the capital structure without talking about the assumption of capital costs or the level of indebbtitedness. But the first point is to improve the efficiency of the operations that we are really working hard on. And the second point would be to raise the bar for the new investment, innovation for new investment, we're going to demand more return to approve the investment. And the third point is that we are revising the business portfolio. So these 3 pathways will lead us to destroy and ROIC that we have for the Bandon Corp. I return to you, David -- Davi.

This is the last question. Just telling you from Luiza because of time, but remind you that the channels are open, super open for you. So contact our RI team if there are any questions regarding the events. Many of you here already has access to us. The channel is very open. So as we mentioned in the beginning of this event, being a new -- a good year, a bad year, we will always come here. We're going to talk about the company. This transparency is mandatory for us as relationship with the investors. So count on us to answer all your questions. Now 2 more questions then. Okay. 2 more questions just to close with Cristina, then we go to Andrea.

I'd like to know what is your assessment regarding the M Brazil today? If you do believe that the program can bring new orders, boosting volume? Or would it be something more temporary displacement of the client that will consume and using this program? And how can we think regarding the demand at the end of the year because of the challenges that was mentioned already and taking into account the government program as well?

Well, Ricardo, Mobi Brazil and trucks and also semi traders, we are in this topic. If you could bring more context how this has interfered in the sales dynamic, if it has, obviously. And could you just comment on that, please?

Thank you very much, Luis, for your question. Well, Mobi Brasil, we had the first phase, BRL 10 billion. It was more related to trucks in the first phase. The second phase, Mobi 2, BRL 20 billion, then here we have trucks, buses and semitrailers. Now they came into the second phase. It is automatic, okay? This process does not automated. You release BRL 20 million. This doesn't mean everybody has the right to credit. You register yourself in the gov, the government program goes to the bank. The bank does the funding the whole process to release these funds for vehicles. Of course, it's a subsidized rate. There is a certain amount in subsidies. This helps with autonomous and large fleet owners for this. But there is obviously we see -- there is first waiting period, then we have the release. There is a movement, obviously, it's not structural. So we see it in the sense that we see a change in the plateau. It's got to do with what we mentioned throughout this panel of questions. The interest rate is very important. The foreseeability for the transport goes to the agri and also the fuel sector, and it's important to deleverage and this renewal of the fleet or the increasing of the fleet in this scenario. I answered the first part of the question. The second part is related to without a shadow of a doubt, we've already seen movement regarding aftermarket and also automakers, we have seen that this is beginning to run. They're going to then go in -- we don't need stock for FARA. We have a positive point. Besides since we are a semi-trailer automaker in the second semester, this BRL 250 million, which is being unblocking in the semitrailer automaker. We see it as a very positive trend associated to the factor that I mentioned during this presentation.

Thank you, Ricardo. Reminding you that FAO, we have an RI event. We already invite you to the site visit and FAO. -- hope to see you there. I think Andres your last question.

Thank you, for accommodating it. It's a brief -- a quick question regarding prioritization of investment. I'd like to understand within the CapEx that you have this year, what do you expect for the next year? And also what are the main projects that pass the criteria and for the segment and connecting this to the automation. How has this aspect come into what is priority because considering the current competitive scenario and also the work period 6:1.

We can begin with Stefan and then Anderson.

Thank you, David. Thank you, Andres, for the question. Well, we have an that the opportunities are in finite and resources are finite. So the fastest answer to break the company is to make or take over all the opportunities. This being said, we are prioritizing, as I mentioned, safety of the operations and the capacity -- productive capacity. And the third point comes with technology in the sense of reducing the production cost. And these are not exclusive things. Many times, when we look to a safety topic, we have the means of increasing automation, the output, changing the equipment or putting another robot inside the plant. So obviously, we begin with a pool of requests of the units, the vertical units. We take all this into account and we put it on a spreadsheet, and we look at the return indicators within this prioritization of the investment that I mentioned. So the other point then would be that what we have looked to execute and you know more than us that the spreadsheet accepts anything in terms of projection, but it is important that we managed to deliver what we committed ourselves to during these projections. So we have looked at this to see the level of promises, what has been the history of the level of delivery and allocated the resources to each of the units. And once again, it's not a blind thing. We have discipline, but at the same time, we are humble and flexible to adapt to the scenario as we see the change in the drivers.

And that's it. I don't know if Ricardo or Pontalti, do you have anything to say?

Ricardo said we shouldn't both speak because we're going to fight because of CapEx. I think automation is vital more than ever today. And there is indeed an overcapacity in Asia that they're trying to find a space for it because restriction of Europe and the U.S. are higher than the ones or bigger than the ones we have in Brazil in certain product lines. And this overcapacity will seek good space, and we have to defend ourselves. But it's not only because of that because automation is necessary because the hand labor is not enough. It's not qualified as it was in the past, and it is very expensive. The reality is that if you look at the taxes that we have on the payroll and the complexity that we have is huge. I do understand that our professionals shouldn't get their pay. They don't receive the pay, it goes to another place. And we have to then discuss this. And of course, this can become a thesis. So automation is necessary because of survival. And today, we have dedicated at least 34%, which is an indicator that we saw this week of our CapEx focused on automation. It is an equipment. It's a new equipment that brings more complexity and another one that brings automation in the plant -- implemented in the plant. But this journey must be accelerated. We have -- we know this. We know we have to address this more and more and access equipment with technology, AI and embarked embedded to transform the process. But we have revisited a lot of the footprint. And when we do this, I've got to invest in this plant. I've got to change the plant. I'm going to look for a sourcing partner. I think the strategy of having sourcing for certain product lines that added value in a country where a supplier can be more competitive than you and you can work the IP, you work with the brand would be more -- be smarter than automating. So all of this is on the table. So since the market is in transformation, this is being questioned all the time. The answer is we have to accelerate this even more. It's not only in the core, it's the whole country.

Thank you, Andres. As you mentioned, we were talking during C, the need, I'm not going to be redundant regarding to what was already mentioned. The immediate need to get a response if you want to be competitive. When you go to our Mouau plant, which is our next meeting, we'll be there in Mo Guaul plant, you'll see the level of automation that we have in this plant of the front axis. Besides in automation, you have less complexity and the illumination activities where you can't even find manpower or we cannot find welder, good welders in any of the regions in Brazil. So -- we see the integration of the activities. You have AGV automatically supplying the line, integrated line through our easy system, which is our own system developed by Cesar's team that communicates the automation with the production, the supervisionary system. This with the robot makes a completely integrated system. It will be interesting for you to look and see how we think automation inside Randon Corp.

Very well, I'd like to thank our executives for the valuable information they have brought. I'm sorry if you couldn't ask your question. Our team is still available. We have a little bit of more time in the coffee, and then we're able to answer some of the questions. I'd like to mention that today, we have other 2 mentioned of the Executive Committee, Cesar and Marcos to whom we thank the participation. We couldn't accommodate the whole of Brandon Corp within the time that we have. But without a shadow that, we have more margins of integration, and you'll be able to talk to our investors and probably at [indiscernible]. So thank you very much. Thank you. As I mentioned, this event has a partnership with AMEC. I'd ask Daniel to remain here on the stage. And we will now call Paco, the President of the Board of the bank to deliver the price.

Everyone, colleagues, investors, analysts, I am Brandon Co from Rice. And it's a pleasure to be here in the quality of the Board of Administration. I have a huge satisfaction to deliver the assertiveness of 26 years of consecutive meeting in partnership with our association. A lot of water went by. We began as AMEC. Now we are APIMEC in Brazil. So it seems to -- it seems that it was yesterday. I thank you very much for all this. We already have requested you to assess this meeting, and so we can get the return of this excellent meeting that you have been made available for us. Thank you very much.

Thank you. Good evening to all. Daniel, would you like to say anything?

I'd first like to thank Luc Apimec and the whole team, our IR team that helped to organize and Comex and all our investors, analysts, Boards. It is a very important day for us this afternoon to talk more about Randoncorp, our strategy. This Q&A part was very important as well so that we could understand what we have presented. And also once again, Randoncorp continues 77 years in history. Our purpose is to connect people, wealth and generating prosperity, and we will continue generating value for our shareholders and stakeholders.

Thank you very much. Well, for those who are here in person, just I'd like to thank your presence and the partnership with APIMEC and all of those that have followed this moment online. We now know that our day-to-day conversation and this moment of presentation and getting closer to our executives is essential. Those who have followed us online, thank you for your being present there. The material will continue in the network, so you can do the download of the presentations as well. So online, then we say goodbye and see you. [Statements in English on this transcript were spoken by an interpreter present on the live call.]