Sendas Distribuidora S.A. (ASAI3) Earnings Call Transcript & Summary

Good morning and thank you for waiting. Welcome, everyone, to the webinar on the management's presentation for the General Shareholders' Meeting that would be taking place on the 26th of April 2024. For those of you who need simultaneous translation, I would like to mention that we have this tool available on the platform. In order to do so, please like the interpretation button through the globe icon on the bottom part of the screen, and choose your language of preference, Portuguese or English. We'd like to know that this earnings call is being recorded and will be provided on the IR website on ir.assai.com.pr. [Operator Instructions]. Now I'll pass the floor to Gabrielle Helu, the Investor Relations Director at ASSAI.

Hello. Good morning, everyone. I'm Gabrielle, and thank you so much for participating in this webinar. It's a pleasure to be with you guys today. We're going to use this time to discuss our management proposal for the general meeting in 2024 that this webinar will be presented by the Chairman of our Board, Oscar and the [indiscernible] people and management. And today, we also have other members of the Board as well with us José Guimarães Monforte and other members of management, like Belmiro Gomes, our VP of People Sustainability. And at the end of the presentation, we will also have a Q&A session. As Rodrigo mentioned previously, we'll send the questions, I would like you to send them in writing through the chat icon. And we'd also like to ask you to please use this firm to discuss topics related to the management's presentation exclusively. Now I'll pass the word on to Oscar to begin his presentation.

Good morning, everyone. Well, I'd like to know if we could talk about how the government -- governance in the company has evolved recently and in the past 3 years. The next slide, please, Gabrielle. Let's remember that as a company that has been around for almost 50 years, but as a true corporation, it's less -- it's a little more than 3 years only when the spin-off from GPA happened in December 2020, the listing in '21, then we had the 2 follow-ons with Casino that led you have a company exit in June '23 with the elections of this Board on the 27th of April last year that you guys elected and then we had the surprise of the non-approval of the compensation package. And then the Board presented a new proposal in July. And then with the exit of Casino, we had the substitution of one Board member in September '23. So today, when it comes to governance, we have 8 members that are completely independent on the Board and Belmiro. Next slide, please, Gabrielle. As you can imagine the work of a new Board that still didn't know the company and Board members have never been working together before. We did have intense interactions. We had 24 meetings -- board meetings, 22 committee meetings for culture and compensation, which became the main item on our schedule and 15 meetings on the Audit Committee, 10 meetings with the Investment Committee and 7 for corporate governance. And what's interesting is that we had 100% participation of everyone in all meetings. So it was a period where we had intense dedication, which does not mean that the Board got into the operational aspects of the company. We were very cautious about this in keeping this strict perspective on the role of the Board and the executive management team. And of course, we'll be very close to the company, but we don't expect the same level of dedication from now on as happened in the last year. So next slide. Now what we heard from you guys and got into lot of was the need to align the interest of the executives with long-term value creation for all shareholders and also adopt the best governance possible, not only when it comes to Brazilian reality, but also global reality. So we did perform some big adjustments like the callback policy. And so this was implemented in December last year. And now -- from now on, we created a policy for the stock ownership guideline and this will require that a CEO has at least 5 years of fixed compensation in stock in the company and the other directors would have 3 years of fixed compensation in stock, which is going to be deployed if this is approved by the ordinary general meeting that's going to be occurring at the end of this month. Next slide, please. Now the biggest bit of news here when it comes to governance was the engagement with you guys. Even when it comes to present reality, I think Assai innovated a lot when it comes to the dedication that we've had interacting with the biggest amount of shareholders to be able to look at all the contributions that were very valuable and that helped us to design what you will see up ahead or have already seen in our General Shareholders Meeting manual. So in the last year, preboard, Belmiro really dedicated his time to this before the General Meeting in April 2023. And this was so interesting, and we actually had the election of the Board as proposed. And so we had help from specialists during that process and that works. So then after we elected the Board and we had the rejection of the compensation ban that was presented at a second phase of engagement where we spoke to at least 30% of the shareholder base when we listened to the reasons for the non-approval concerns with the program, we adjusted all of this. We created an intermediate proposal in July that you approved and then we committed too in this meeting in April 2024 present a definite plan. So then we had a second 1/3 where we talked to about 44% of the shareholding base, and we had extremely valuable contributions. As you can imagine, it's impossible to please everyone, but there are many different perceptions of course, about what are the adequate metrics, how to define these targets, how to not define targets. But we think that we are convinced actually that the proposal being made addresses in the best way possible, the concerns you have. That is also the best for the company. Well, we're going to be discussing in the Extraordinary Meeting and the General Meeting is that we have this financial discussions, how we're going to be dedicating our profits in '23 and that there won't be payment for dividends as all of the profit was attributed to fiscal operations that cannot be distributed will request the ratification of the election of Dr. Enéas Pestana as a Board member since he joined as a substitution of the Casino rep and then we will also request the approval for the compensation plan in 2024. And so we wanted to approve the standard plan for long term in the company and we're going to be presenting a new program that we called the executive partner program in the company that will be strongly connected to performance, and we'll have a global limit of this program as well. Then on the next slide here before we start discussing the compensation program, it would be interesting to take a closer look at the long-term history in the company. [indiscernible] first stock in ASSAI in 2008. And in 2010, they had the purchase of the rest and then the opening of these 20 stores. So from 2010, 2011, the operation generated losses and there was a cash gap of about BRL 120 million. Then in 2011, Belmiro Gomes team were attracted to administer ASSAI, bringing their long-term experience at Atacadão they had extraordinary success, receiving about BRL 200 million in investments. And from then on, there were no more financial payments in the company. So all of the growth was generated with its own capital generation. So then there was the split between GPA and ASSAI in 2020. At that moment, we had 123 stores open. And then we had the purchase of the extra stores. Now we have 288 stores with coverage in 25 states and BRL 72 million of sales. So what was the value generated in this period, here we're just mentioning the values generated for the former controller between '17 and '22, we had dividends paid of BRL 957 million to the former controller. We had 3 offerings, which the former controller had made the generated BRL 8.9 billion of results. And in the split with GPA, ASSAI took on a debt of BRL 9.3 billion that was not connected in any way to assets in the company. So it was a debt that was pretty much generated by the purchase in Colombia. So if we add up these numbers, we have BRL 19 billion in value to the former controller generated. And this is a really good indicator of the capacity to generate value that the company has and it's also a good indicator of what we can expect for the future, and that's why we are presenting the package for compensation, as Leila will describe now. So we are convinced that this company has extraordinary capacity for growth and value generation. And we would like to keep the team that generated these results up until now. Thank you so much and I'll pass the word on to Leila.

Well, good morning. Thank you for your presence, everyone. As Oscar mentioned, after the last General Meeting, the Board was committed to perform an in-depth analysis of all of the programs for the compensation in the company going from fixed salaries, variable and long term. And this was the work we performed in the People's Committee. We have another 4 independent members that are members that were CEOs, and they had a lot of experience in people management and we had a specialist in the market also that specialize in people and compensation. And we also have all of the support for the VP of Human Resources, Sandra Vicari and all of the management team in the company. We hired specialized consultancy firms, and we wanted to explain this process a bit to understand everyone's engagement in the board, not only this committee. So we had some specialized consulting services in Brazil and abroad on the compensation and the long term and assessment as well as the value of the company. We had major market research with peers and their characteristics are similar to ASSAI's when it comes to volume and being publicly public companies, public health companies, and we spoke to other investors to understand their criteria also used to prove compensation programs. And as Oscar mentioned, we also participated with the Board considering the engagement of our base of our shareholders. And then through all of these conversations and research and these were in the work, we had 22 meetings that were mentioned. And then we started preparing the plan, and that's where the purpose and the guidelines we worked on were, first of all, alignment of the interests of executives and shareholders. And a significant part of this compensation should be long term in different stock related to performance. So this is a strong message. And then after, as Oscar mentioned, we really want to attract and retain these executives and recognize or acknowledge them for making the company what it is today with this journey of success so that they can support and capture this for the new investments in the company and then the compensation must be competitive. Based on this, we moved on to -- we started analyzing the criticism as well that we received last year. So ever since the General Meeting before last, the compensation already fixed this last Board within the average in the market and fixed. So we still had some months with the former controller with some variable impacts but 2024 will be the first year with the full year for the fixed compensation for the Board, then we had a cost of 35.8%. And this, of course, related to the new fixed compensation for the new Board in this year. This number will move on to 10.8%. So we had a reduction of 2/3, 70% of the Board's compensation. And once again, we kept the compensation in line with the market practices or standards. And then about the 2 other plans, ICP and IOP long term and short term, as I mentioned, back then we were really concerned about having a better alignment with the shareholders to maximize value generation results. We also heard that sometimes plans are not necessarily awarding the best results. So in this short-term incentive before we start talking about it, it became like a single profiteering plan. We had a lot of short-term incentive plans. We had some metrics and indicators that were reviewed and analyzed and we had an emphasis on financial indicators. So all of these were resulting from the conversations and internal analysis. So we also include this in the inclusion of a new plan with a cutoff of 80% of the EBITDA target pre-IFRS, which in our vision reflects the performance of the company better. So the condition for profit sharing is applicable if you reach the 80%. If you don't reach that, there's no profit sharing right, the PPR, as they call it in Brazil. Then the new payment curve is also reduced from 50% and 150% and the achievement, which was 200%, is now almost 120%. So 50% is paid if there is the achievement of 80% of the target and 150% is paid if there's achievement of the 120% of the target. So the intervals were reduced significantly. And the metrics, as we mentioned, we had a bigger emphasis on financial metrics and we created a set of indicators for the company, which are common among all employees participating programs. And are the main indicators that assess the performance at ASSAI in our vision. So of course, worked on together with management. So the net sales and same-store base, that's going to be 10% for everyone. The net income 10% and net debt 12.5% and the consolidated EBITDA pre-IFRS as a percentage of sales, considering stores open until December 2022, plus 12% -- 12.5% and women in leadership position, which is a target of short term and we've evolved a lot on this and the reduction of CO2 emissions that we have ambitious targets to achieve in the next years. So these indicators together generate a score for the corporation that represent 50% of the ICP, which are the short-term incentive plans. And from the other 30%, 30% are related to indicators on their own department area that are specific to assess performance in a specific area because retail has a lot of details. I would try to simplify this as much as possible. The amount of indicators and metrics, there are some departments that have some of their own metrics that were kept here in these 30%. And then you have individual indicators also which are quantitative and qualitative. We haven't worked on discretionary points. We want to have quantitative and qualitative targets for leadership, et cetera. So here, it's a short-term incentive. And the second chart on the right side is the long-term incentive. Here, you also have a big shift. The long-term incentives were associated to the short-term results. And then we started having and also associated cash payments and the long-term incentive plans are 100% stock-based and used to be 50% performance, 30% retention, 70% performance. We also increased the share of performance in the long-term incentive plan and we also changed the targets and metrics, privileging financial results and the operational cash flow and ROIC, which are 2 indicators that are very important for a company like ASSAI, represent 35% each. So 70% of the long-term incentive plan has been connected to these 2 indicators, and we have other indicators like black people in leadership positions, which is a challenge here in Brazil. We've evolved a lot. We have targets for the next few years, the reduction of CO2 emissions, which are also the long-term targets. And here, we introduced the concept of training and preparing successes, which we valued a lot. And I wanted to explain this a lot because what happened is the company had growth that's very quick. And this very quick growth made us promote a lot of people very quickly. And now we need to reestablish this succession pipeline, let's say, among all of the executives that participate in the long-term incentive plan and also our business model privileges decentralized decisions. And so we have to have executives that are trained and prepared. But in ASSAI, it's very big when it comes to regional perception. We have a big focus on preparing succession executives. We have a plan to -- the development -- the long-term incentive plan in 3 years should be one or more successors prepared to occupy their position. And in this case, 5 years would be the case. So we're going to be monitoring development but also considering the end of the period. We'll have the succession plan prepared to guarantee the growth of the company. And I talked about this succession, the CEOs up to 5 years and up until the CEO will have 5 years to reach the targets that are going to be defined. And in the case of the other directors, it's 3 years that are direct considering the assessments of these targets. And then we'll have the opportunity to clarify any questions. And I'll follow this in the presentation, we have 2 graphs to show you the compensation of the Board that incorporates this long-term component. It's the most significant actually. And here, you have the accounting vision and also in the account reference primary of the accounting vision, but we monitor the administrative vision as well. And what we're already proposing here for 2024 is very similar to what we proposed in 2023 in the last general assembly and in regards to what we performed a bit above this because considering the variable compensation, we paid a little less than what is expected in our curve. We always consider we are reaching all of the targets and we didn't reach some of them, which is why we had a value that's a little smaller, but the proposal for 2024, which is almost 39%, almost 40% long term, 37% mixed and [indiscernible]. So these numbers vary a little bit from year-to-year, but a very similar value. So in 2023, we had an extraordinary grant of a retention plan that I mentioned. And we had a lot of programs in the short term. We had this parcel that was expired in 2023 and we're not going to have this in 2024 anymore. So that's why in this graph vision BRL 10 million lower than the accounting vision, which is what needs to be applicable in our reference form. So here is just to mention our work intended to mention the numbers that are already approved and are lower than what was achieved in 2022. So then we have this proposal that was already included in our manual, which is something we're calling and this is focused -- this executive partner vision. And so this program is common in the U.S. and there, they call it CEO shareholder, which is the idea where you can make these key executives that are more strategic to the success of the company up ahead, participate in the growth and value of the company. This is not like a -- besides the long-term incentive plan, it's not like a traditional compensation program for executives. It's a partner program and actual executive partner program, strong alignment to the objectives of the shareholders, the targets are very challenging. And you probably saw this in the General Meeting manual. These are value creation targets for shareholders at a very challenging long term, 7 years and another 3 years of lockup. And so this is a very long-term perspective. And an actual right to share stock connected to value. So we performed different international consulting firms to understand which would be the possibilities of this program, which is long term. And the wealth sharing that these executives of -- if this program is approved, does even reach 3% of the company's value. So there's significant value to shareholders and our proposal of these 3 executives, which are Belmiro, of course, obviously, because of all of his work. He's been implementing ever since the beginning. And the leadership there as well and Wlamir dos Anjos are responsible for areas that are extremely strategic and as the commercial VP of Logistics, Anderson Castilho was our VP for Operations have been in the company for 12, 13 years. So practical at the same time as Belmiro until this group of 3 people here really needs to be acknowledged and recognized, and this is what we're proposing with this program. It's limited to 2% of the total amount of stock issued by the company. We won't have a dilution because the stock will be bought and kept in the treasury, 30% of the program will be retention regardless of this performance based and then from the fifth year onwards and 70% of the program will be due to the achievement of these goals that I mentioned that are very aggressive, and we chose the EPS and so we know that there are a lot of indicators. We assessed many indicators, we discussed with many investors as well, even the TSR that's very used. But in Brazil, the sample of companies is very small. So we don't have companies that are very similar like ASSAI, we had many distortions and so we chose EPS. We understand this is an indicator that reflects the performance a lot of the executives in the company. And then minimum to start paying for this program is the IPCA plus 20%. So we consider the base of the 31st December 2023. So in 7 years, this will add up to a huge level of growth and we'll still have the 3 years of lockup. So it's an innovative program. We understand that there are some companies in Brazil that already adopt this but we think that ASSAI deserves this and it's really adequate to have this situation with ASSAI really becoming this corporation and it's accumulated growth and they had this growth project for the consolidation of the company that's also very strong in the next year. So this is a new program. We're also going to be available here to discuss any questions you may have. But we understand that this is a program that's fundamental and relevant and very opportunistic at the moment. We're living and experiencing it at ASSAI and the responsibility that these 3 executives have and the success and value they bring to the company. Then on the next slide, we demonstrate how the evolution will happen. This is the payment curve for this program throughout 7 years. And if we reach the minimum, which is already high, 20% plus IPCA, the payment will be 0.4 per performance and plus 0.4% for retention. And then this is going to grow on a curve until you reached 1.6% and 0.4% retention, which is at 2%, which is the most requesting and asking you to approve. So the best thing will be 7 years and 30% will be retention that's also going to have scalable by [ 30% ] on the fifth year, plus 70% in the seventh year. So that's why this is a program that is very different than the other programs that I just presented and we understand that it really contributes to this entire project to retain value and attract talent in the company as the company is in a moment with the market very competitive with a lot of competition and regional is growing and a decentralized model. So we have a major reliance on regionals. And so we try to present this program, not only just one for the executive partner program, but all of the fixed salary competitive and short-term incentives, long-term incentives and Executive Partner Program, which could cover all of the company's challenges. Thank you so much. And then we have a last point here, sorry. We had a history here and the proposal for 2023, which has this global compensation. And so -- and here we're considering BRL 61.1 million for this program. And here, BRL 25.5 million, which is as part of the Executive Partner Program that's going to be accounted for in 2024. And then we will only know if this is going to be paid or not and what's going to be the effective value by the end of the 7 years. So we must account for this throughout the period of this program. Thank you so much, everyone, and I'll be available here.

Then now we'll start the Q&A session. [Operator Instructions] Now I'll pass the floor to Gabrielle as she coordinates the Q&A session.

Thank you, Rodrigo. We received 3 questions related to the compensation program. And the first 2 ones are related to indicators. So I'm going to read them here. These are questions from Ruben Couto a sell-side analyst at Santander and Leonardo Pereira will answer both of these 2 questions. So you guys talked about total value of the Executive Partner Program of BRL 336 million related to 2% of the company's stock at a price of BRL 12.43 million. Can you explain how you're going to consider this from an accounting perspective in the long-term incentive? How and when will this happen if it proposals approved as it is. And if in the next years, the EPS trigger is achieved? Is it going to be an additional effect? Or is this already provisioned for? Then the second question is considering that the entire incentive long-term plan and variable compensation provides impact on the results. Can we consider that you guys will not exclude these expenses from the EBITDA and in the calculation of the profits per share to achieve your goals.

Thank you, Gabi, and thank you, Belmiro. So now you guys can hear me, right? So I will answer the question from Ruben here first. Ruben, the approval of the program as it was presented must be done considering the maximum on the green line presented, when you consider retention, it can go up to 1.6%, and the distribution will be 2%. But when you account for this, you must consider the expected value and the expected value is supported by the strategic plan in the company. Maybe the expected value -- and we're talking about the middle of this green line, which would be 1%. And then the provision instead of being BRL 336 million, it would be BRL 235 million. Since in the first year, you have 8 months from the [indiscernible] up until the 31st of December, the value is BRL 25.5 million, which is the amount that Leila presented on the last slide. This amount will be remeasured at the end of each year. And the launches of these adjustments will be made as credit and net equity. But then about adjustments in the EBITDA and the earnings per share? The answer is no. There won't be adjustments.

There's a third question still from Ruben, which is a question for the Compensation Committee. And it's going to be for Leila. So how is the Compensation Committee guaranteeing you're feeling comfortable that the proposal for incentives in the long term does not encourage maybe an excessive risk approach beyond usual to reach the proposed targets?

Ruben, thank you for the question. We assessed this and we have a set of metrics and targets, ICP, like long-term and short-term incentives and the Executive Partner Program, which is the most challenging. If you have excessive risk, you can benefit or harm one program or the other program. And actually, the risks are assessed by the Risk Committee and Audit Committee and by the Board, not only by the Compensation Committee. So we understand that this risks -- taking on excessive risks to reach these targets will have to be controlled by the entire governance structure in the company, starting off with the Board committees, et cetera. So we don't think this is a topic that concerns us that much. We think that there are ways to control this and mitigate this kind of risk. I don't know if any other colleagues would like to add on to this.

Yes, I would add on to the fact that this is why you even have a 3-year lockup, right? So there's really no incentive to try to maximize earnings in 7 years and then have a big drop. The lockup is also an incentive to avoid excessive risk. That's why it's important to remember that -- who defines the capital structure, who determines the level of debt and monitors risk is the part. It's not only the executives that have the authorization to do this.

Okay. These are the questions we received in writing up until now. So I'm not sure anyone else has any questions you would like to send this through the Q&A icon, if not, we'll move towards the end of the webinar. We have one more question coming in. This is a question that's not about the manual. It's a question about initiatives in the company that we're going to handle directly with the journalists. And so I think we can move on to Belmiro for his final remarks.

We have 147 participants. I wish we would have more questions about this, anyone else? Let's give it a few more minutes. If I'll have a quick speech, but even if we do have another question, that will be great, take advantage of this opportunity with our analysts, investors and especially with so many members of the Board. So I'm encouraging all to the major questions from these 147 people would like to encourage this. But of course, afterwards, I wanted to -- well, first of all, I want to thank the Board for their understanding. As Oscar mentioned, there's -- I want to understand the company, which is one of the biggest in Brazil. And you have this understanding at the moment in the situation when it comes to governance. We must hear investors and really prepare this plan that we're seeing as well as the other changes also in the long-term incentive plan. So -- and so we really have this reflection on this journey with major challenges overcome and also huge achievements. And so this is listed in our revenue but also because we're the company that's present in the Brazilian households. So I think the transformation history is one of the biggest success stories and present retail. I don't want to be arrogant here, but I think we were able to transform this model and really become a reference. So this took place through the dedicated work and efforts of our executive teams and employees, and we're committed to growth in a sustainable way and especially valuing -- value generation to shareholders. ASSAI as Oscar mentioned is little highlighted is recognized for strong cash generation capacity, the last investments you received was back in 2011. So the plan is really in line with the objectives and the strategy in the long term for the company, which is now entering this new phase and this new market with corporate governance and social responsibility and the practices we have for compensation are fair, balanced and really have an alignment between the management and shareholders of the company. So I think the idea was to generate more trust in the construction of the future in this new phase at ASSAI. So I want to thank you all once again and for your help and the Board, and we have a management that is completely aligned with this, but the plan is aligned with the objectives we have for the next 7 or 10 years. Thank you. And that's what I have to share.

Well, now thank you, Belmiro. We received another 2 questions here, actually 3. If you encourage people to ask, they will ask. But anyway, the first question comes from Maria Paula Cantusio, she is a Santander analyst and her question is the current long-term incentive plan and I think Leila could answer this, but the current [ ILP ] will be an effective shares like company had lot of options, right? What will be the limit in percentage of the company's shares? Does this change generally greater dilution?

It will be stock-based in the company and not stock options that's for sure. And we have a limit of 1.5%. There will not be a dilution because we will also buy and keep these in treasury, okay? Sandra do you have anything to add on?

No, Leila that's exactly it.

We also received another question from Antonios, he's an analyst at [indiscernible] and it's a question to Oscar. He says, Oscar, what is your dream? And what will this program be translated to you as you desire towards ASSAI?

Well, Antonios, we can answer in Portuguese, and he understands that as well. But Antonios, I think my dream is to start off with a little more of the same stuff because the history of ASSAI success is extraordinary. And if we keep the space, it's going to be spectacular. But this program should bring a commitment absolutely from the 3 main executives as real owners of the company, they will be partners and shareholders, and they will have the same incentives as you. We'll have the same horizons and lockup, a minimum 7-year lockup. And in my experience, I think the company has a reference shareholder that's dedicated to the business, but they generate a bit more value. And here, we're going to have 3 shareholders that are referenced shareholders and dedicated to the business and that will generate a lot of value. They're not going to think as executives, they're going to think as shareholders because that's where you have the biggest value generation for them and all the other shareholders. And this is my dream that we can have 3 executives that think more as shareholders than just as executives. And this is going to be reflected in all of the company's employees because great experience they had and I even recommend shareholders to experience because [indiscernible] a lot of people, but come watch a store opening to understand the spirit of the ASSAI team and come and visit, schedule this with Gabrielle, go have lunch at our store. When we have board meetings, we eat with the employees. We sit down with the employees in the same restaurant. That's where you get a feel of the environment, and that's what we want to create. We want to create this environment as absolute partners with all levels of the company, from the board, top management, all the way to employees in the stores because it's a full set of people in a group that generates value. You can't maximize only one link in the chain, you need to value the entire chain. And this is my dream, really being able to perpetuate this in the best way possible.

Perfect. And we have one last question now. João Soares from Citi. He wants to hear a little more about the succession process. Said I think the new proposal purchases clearly and places this as a target for compensation. But I wanted to know how Belmiro has been preparing his succession. This question can be answered by Leila.

Well, the question is for Belmiro, but I'll answer for you, Belmiro. Yes. So anyways, what we are working towards the personnel committee and the Board, of course, together with Belmiro, is that we can create some succession alternatives for him internally, and we have a development plan that some executives have been working on at the central side and also for the regionals. And of course, mapping out the market, the target for Belmiro is that he will have -- well, we have 2 targets actually, an intermediate one for 3 years of the long-term incentive plan with this person defined and in 5 years, have this person ready for substitution. We don't want him to leave in 3 or 5 years, but we want him to have the chance to experience the succession in his period. So we are supporting him in this assessment and this evaluation and the development programs. First of all, looking at the internal talent, which is how ASSAI works, first look inside first and then also mapping out looking at possible successes in the market if necessary. So we've been looking at this closely. And I don't know if Belmiro wants to add on but.

Your answer is perfect. Thank you. Obviously, we are working on a long-term plan and there's a deadline we have to look at. But of course, the company must be prepared for possible changes that could occur with any human. So Leila was perfect in presenting our answer. Okay, Gabi. Very good. So officially ended the Q&A. We have no other questions.

Well, guys, thank you so much, and we hope to have your participation in our General Ordinary Meeting. And if you have any additional questions, if there's something ASSAI innovated and knows how to do is to speak with shareholders, we speak with shareholders. If you have more questions, you can get in touch and contact us, okay? Thank you so much, everyone. Thank you. And the Investor Relations department is also available if necessary. Okay. The webinar on the management's proposal for the General Ordinary Meeting is officially ended and the Investor Relations department is available to answer any other questions that may appear. Thank you so much for your participation, and have an excellent day. [Statements in English on this transcript were spoken by an interpreter present on the live call.]