Vivara Participações S.A. (VIVA3) Earnings Call Transcript & Summary

Good morning to everyone. Welcome to the Video Conference of Results of the Third Quarter of 2025 of Vivara. In this quarter, the company will dedicate 100% of the time of this video conference to the question-and-answer session. The video with the comments and the analysis of the financial performance done by Icaro Borrello, the CEO; and Elias Leal, the CFO, is available since yesterday on the IR site of Vivara. [Operator Instructions] In the name of the Vivara team, we have with us Icaro Borrello, Director, President; and Elias Leal, CFO and Head of IR. We'll now collect your questions.

[Operator Instructions] Now, let's go to our first question from Luiz Felipe, sell-side analyst. Luiz Felipe, please open your video and audio, so that you can make your question.

I think, two questions from my side. First of all, if you could comment on the pass-through of prices in Life, how you see that in the increase in the price of silver and how that will affect your prices and the effect on volumes, both for the third quarter as well as what we might expect going forward? And the second question, I wanted to understand a little bit better about the dynamic of the fiscal incentives in the next quarters. As we have started to see the effect of the CDB in Espírito Santo in the third quarter. And I wanted to understand how -- what we could expect going forward?

Hi, everybody. Good morning, everyone. A short opening. It's a pleasure to be here with you. We're very happy and satisfied to communicate these results with you, which is very solid results, robust results in our understanding. We have delivered the biggest revenue in the history of the company for the third quarter, the best gross margin, the best EBITDA margin and also the best cash generation -- operating cash in the third quarter, in the history of the company. We know there are several -- some homework to do to address. And we're going to walk -- talk to you about some of our stock. And we have some questions directed at that. And it will be a pleasure to answer your questions. Good morning. We're going to start answering your question. And then after, Elias, please feel free to add anything you might want to add. From the standpoint of pass-through of prices to Life, we see an increase in the price -- increase of commodity prices for silver. We have reduced our needs of the purchasing in this last quarter. In this quarter that's coming due to the process of a redistribution of merchandise among stores and also the meltdown of unsold, which has also happened in gold and is also happening in Life. The pass-through of price is a natural process, which we're very diligent, and we accompany this month by month, and we accompany the demands of the market. So now -- from now until the end of the year, we're going to the seasonal year period from Black Friday, where we are -- it's very difficult to pass-through prices. But it's also a natural dynamic and we understand that. We don't have so much effect in volume, because we control very much the pass-through of prices. And so, it doesn't show up so aggressively. The second question in relation to the fiscal incentives, this was something that we have planned to do at the end of 2024, which worked very well. Today, we're operating our distribution center in Espírito Santo with the potential of approximately 70% or 80% of its capacity. These are two legs to this plan. We started this first leg through the supply of our stores. And the second leg through the delivery of products purchased in our digital channels. So, we've now started to ramp up this starting in October, the second leg, to reach the maximum potential of the operation. So, everything that we have collected in the third quarter from the standpoint -- a structural standpoint will be repeated going forward. And in relation to that, we also have the benefit of including the orders of e-commerce orders through Espírito Santo.

I think, it's also worth remembering that in our composition of costs for silver, silver represents about -- the raw material represents 50% of our costs. The other 50% is labor. So, within this raw material cost, obviously, the majority is silver. There are other components such as gold plating and rose gold plating and so forth. So, it has a much lower effect than the increase in the gold prices which represents 80% of the price in gold products. So beyond that factor, we also have a markup, which is quite a bit higher on the silver items. The effect of an increase in prices as a consequence of the raw material has a much lower effect on these products, is something that we see with a lower gross margin, which is very satisfactory in Life, and we're very satisfied with the gross margins. And we also continue to do -- to be diligent on our markups, accompanying the speed of sales in accordance with what we projected and the needs for each one of these lines where we have the opportunity to be pass-through of prices. And also the CD and the Manaus factory, et cetera. So, commenting also in terms of the cost of capital with us, [Technical Difficulty] He became a father this week. So, we offer him congratulations and his new period in his life. So, we soon -- shortly he'll be back together with us, Icaro.

Our next question is from Rodrigo with Itaú BBA.

Two questions from my side. First, if you could explain a little bit more about the concept of the gross margin. It's the second quarter of expansion or big expansion in that number. Besides looking at the principal components of the expansion of this gross margin. The same question, I mean, in the last quarter, which you had very much comfort that this is structural. In the question of markup, as you mentioned in your release, but just please explain this dynamic and this question of gross margin from the standpoint of sales as well as gross margin. Are you still working with the same dynamic as in the third quarter going forward? And the second question I was commenting with Elias is the question of stocks, inventory. Many people since last night, you're not buying gold. How's your stock doing quarter-to-quarter? If you could explain a little bit better this bridge from the second quarter with stock to the inventory of the third quarter, why it increased? And where do you think it's going to go? But the direction and the comfort that you have in this relation is very important for us. These two questions.

Thank you for your questions. I'm going to address the -- from the standpoint of gross margin, we have four initiatives, three of them which were already implemented at the end of last year, which are currently helping us to increase our level of gross margins. They are structural and will continue going forward. The first one, in relation to the best purchase of inputs and purchased products. We have good negotiations going forward with our suppliers, suppliers of watches, accessories and gemstones, which we have a great deal of efficiency in these negotiations. The second question and the most relevant certainly is the implementation of the distribution center in Espírito San, which has had an impact on our rates and our gross margins, and also -- is also a point which is fundamental for the increase of that, and it's also perennial. We will continue gaining with this benefit going forward. The third is the diligent management of pricing. We have a stock which is more larger. We have an advantage compared to our competitors. So, we manage very carefully the gains of share and the gain of margins that we have done this, in our opinion, in a very satisfactory way. And finally, the four levers over the next quarters, final last quarters, we increased really the number of people in the factory to nationalize more and more of our production. And we have been able, through the nationalization of Life and giving more efficiency to our goldsmith that the products come out a little cheaper from our factory. So, we have a reduction of people over the last few months in the factory. This was already a plan that we had, an internal plan that we have in this. Once they gain more and more productivity and have more technical knowledge, they're able to produce more and more. And we choose either we increase our level of production or are more efficient from the standpoint of personnel. So for the gross margin, it's these four points. And from the standpoint of inventories, we have an increase of BRL 120 million when we consider the CGEG of these BRL 120 million to do a little bridge, half of that increase came from gold, which we captured in the market. It's a stock which is very good, because it attends very well the need. We have no need to purchase gold for the next few months. So we've already put this into the release. At the end of the next quarter, we will have an excess of gold, of raw material in our hands of almost 130 kilos. So this will bring us a natural reduction, both stock need of days of inventory and without the need of purchasing gold. So, half of this increase comes from this week of gold. We had BRL 10 million of this BRL 120 million. The BRL 10 million, which is the impact of the GGR. And the rest, when we compare the other BRL 50 million, which are lacking to close this account is due to seasonality. We see an important effect, which is the increase of 4% in our stocks in this third quarter. When in previous years, we went -- we increased by 3x or 4x as much. So, it's a natural effect of giving our optimization of going forward with that, which we planned to do at the end of last year and add it to -- first front, we have no need to purchase gold, due to our productive capacity, and you already have the historic data. The sales from the last quarter was very relevant. And so, this relation between sales and cost and purchase cost, it's natural that we're able to do an optimization in this picture.

I would also mention that both the dynamic of gross margin as well as stock is very much lined up with our projections. So with gross margins as the same pillars of the second quarter with this gain in efficiency, which we've started to have in the factory due to the maturity that our goldsmiths are having. We have an additional benefit in this quarter, which was the center of Espírito Santo. We're not purchasing in May. It happened the same way as -- due to that, we have a sequential since 2020. And In the stores, we're selling the right items to the right stores. And so still, we're melting down the same store sales that we have in several quarters that we are removing from the stores, that which we are not going to be able to -- won't be sold. From the 14% of same-store sales. So, it's a great deal of assertiveness in these demands. As Icaro mentioned, it's natural with the Black Friday and Christmas when we compare it to other times, it is much lower. And for the gold that I have melted, I've done this, which is more than I produced. So naturally, I increased my raw material holdings in gold, but the finished products, the assertiveness of our plan to -- of the splitting of the stocks that we see in the next quarters.

Okay. Very clear. Excellent. Just a quick follow-up. This dynamic of gross margin, revenue, any changes? Any acceleration, any macro acceleration that is calling your attention?

In October?

Yes.

October, no, we don't see any pendency, anything that are pending. We planned very well, and we are very much in line with that, which we have committed to do. So, we're very animated with the seasonal sales.

Next question is from Danni Eiger.

I have two. The first is about Life. We have seen a Life that is a little different than what we expected. As you mentioned, the initiatives for acceleration, which caught my attention was the falloff in revenue of the mature. We saw that in the release that was in the video as well and the initiative that we're doing in the release of Disney and looking at your exposure in the stores, if you could bring us a little bit more these initiatives and to make sure that it's in the video, this change in the exposition, which would generate results. If you could share that with us in these initiatives, what's being done as well as some preliminary indicators, it would be great. And today also on the follow-up in stocks, going forward, the composition of gold and silver in this -- it's very robust stocks in Vivara, and we see that there's a very tranquil going forward and some -- and Life, it's a little bit less. Is there any of them that are more important, more critical? That's enough to deliver this reduction of stocks.

From the standpoint of same-store sales, preparing for 2026, we have already begun the tests in October. We're very animated from this standpoint. But looking at a vision, a general vision, there are three initiatives from the standpoint of innovation. The second from the standpoint of better exposition. And the third is people. Breaking this down, we broke down -- we have Disney again in our stores. We've already practically done 10% of our sales. So, we recovered a good rhythm of same-store sales in the moments. And we do the same things with the sales. So, we have two more -- have two great subcategories, which are collections and commercial. We increased the rhythm of launches at the end of last year, and we'll continue -- we're accelerating the rhythm of innovation to maintain about 40% or 50% of innovation in our portfolio. The connections and rings, we're able to wear. When we talk about increasing stocks, it's much more beneficial from the standpoint of revenue. More potential with the same product that we have in the stores. But this information, we're able to put the connections to sell the most in each one of the stores, pick up the best themes of moments and put those in the stores, also increase the potential of sales. We see a very classic example. When you go to a shoe store, you don't expose the same brown model around 38 and 39 and 40. You increase your potential in a way that's very simple. That's a simple explanation that we have done to increase the same store. We tested that in 15 stores, with almost 10% of our portfolio of stores. And with the seasonality, we're going to do the rollout of all -- 12 of our stores. So, with our sales force, we're working on that. I think the Life is addressed from the standpoint of stocks and the dynamic between gold and silver. We have a -- as we said in the release, have 130 kilos of gold, which is contracted as a reduction. This is excessive raw material, more than what we need to run the factory. So, it's natural that over the next quarters, we won't be buying gold. In the first quarter of next year, we probably also won't have to buy gold. We'll see an increase of generation of operating cash, which is almost set from the standpoint of absolute numbers. This gives us a tranquility that we can utilize this to invest in Life and potential as same-store sales between gold and silver, it's very distant -- very different. We have a good space going forward.

Next question is from Citi. Soares from Citi.

I'm sorry. How are you doing? I'm going to double-click on something which I've talked about with investors. If we could break down the dynamic of the stocks of the week -- the Gold week, we have an aspect which we think the same-store sales of Vivara. How much we've seen in the volume we've seen in Vivara and how much has been the contribution of the products of the tool and the other products? And finally, excuse me to going along here, but the perspective of the stock on the fourth quarter, your inventories, we have some guidance, if you could -- how many days of inventory you have, not only in the fourth quarter, but also in the medium term, how many days of -- if you go down from 60 days or from -- to what level you plan to move?

First of all, from the standpoint of same-store sales, -- but it was not a surprise. We have been planned, and we saw this in our predictive models, models which are very well run by our planning team and led by Juan. The work that we've done from the standpoint of redistribution of inventory to increase the potential of sales in our stores has been a motor for growth for the same-store sales of Vivara added to the good management of the pass-through of prices that we have done. We have not suffered very much from the standpoint of quantities. We've been diligent with that. It's natural that we have a little more care in passing price pass-throughs in the commodities here in the commercial products. So, from the standpoint of same-store sales of Vivara, we have a very high -- it's a very high level for us. And last year, we had a very good performance. And I think that the stats of that, we have utilized our inventory in a way that is more optimized and more intelligent with a great deal of calculations and analysis to extract the maximum potential of what we have on hand. What gives you the comfort that the same stores will be maintained going forward. It's not a promise, not guidance or a promise, but all the optimization of the process of melting down and redistribution in stores, we're able to understand what are the jewels that have -- don't have a good performance or that low performance or have no performance in each one of our stores. So with that, as we redistribute these jewels and melt them down afterwards has almost no negative impact from the standpoint of same-store sales. So, we're very animated by the end of the year with what we planned from the standpoint of stocks being in the right places, the right pieces in the right places. And I think that the tendency is very good.

The second part of the question, in the -- we're not going to give it without giving any guidance about where will be our stocks for the year. But we also see that what we're doing so that this reduction happens and it will depend a little bit on the -- on how the sales in the end of the year develop. But it's natural that in the principal epic for sales in the fourth quarter the exit of stocks right now. In the fourth quarter of last year, we're not purchasing gold. So the entrance of raw materials, we have a reduction also in -- a very strong reduction in the principal purchases, purchases of imported, which happened in the third quarter to reinforce for the Black Friday and for Christmas. So these are levers which are very positive, which we see, but which naturally will have an effect in this quarter. We have an effect, reduction. And as we mentioned every quarter, it's -- we should continue to see this optimization of stocks during all of next year, coming to levels of days of stock closer to what we had in previous years. The principal indicators are there.

Very clear. I'm sorry, I made a lot of questions at once. But just going back to one point in relation to the impact of the week -- Gold Week in this increase of stocks that you have, if you could quantify the impact of that, it would be important for us to know.

We opened this -- of the BRL 120 million that we added in the Gold Week, half of that have a dynamic of doing three Gold Weeks during the year. We just did one in October. It ended last week, which is very beneficial for our business from the standpoint of the commercial standpoint and from the standpoint of our brand. So, the impact was half of the increase here was impact of that. So, just remembering in a structural way of the BRL 120 million, half was Gold Week, 10% was GGR and the other was an increase from the standpoint of stock for the preparation for seasonality, contemplating all of the new launches. That's our motto here of same-store sales. If we're doing a base -- comparative base of the Gold week, we went up from 3% or 4% in the level of stocks between the second and third quarters. Historically, this evolution between the second and third quarters is more than 10% or 15%. So that would be -- so that will be the optimization of these.

Our next question is from Vinicius from UBS.

The same-store sales of Vivara and Life, how should we think about the growth of the volumes of tickets? And how do you think about the dynamics of the pass-through of prices going forward? And to also understand a little bit how you see the sensitivity of the consumer? And a second question, if you could comment how has been the performance of the Life stores in shopping centers where there's Vivara and in shopping centers where there is no Vivara store? You can help us to understand how this has evolved, how Life has evolved disconnected from Vivara, on its own.

Thank you for the question, Vinicius, let's start here. From the standpoint of same-store sales, Vivara and Life, from the standpoint of jewels, we have a stock which is very -- from the standpoint of raw materials. So, we have no -- due to the good job that we've done in redistribution between stores. So this makes it possible for us to be cautious in the pass-through of prices so that we can gain share without losing efficiency, and we're able to have a little bit more of both gains in gross margin and gains in market share, which is very relevant. For Life, we see the -- in the last month, but we also have a good -- as Elias mentioned, from the standpoint of costs, it's much less sensitive than in gold. We're very diligent in the pass-through of prices. It's a natural process that we do in our business. It's natural that we do this at some moment, perhaps at the end of this year or the beginning of next year. However, with volumes, so it doesn't bother us so much. It's a good question, and it's part of the operation of our day-to-day for both the jewelry as well as for Life. In relation to the stores, that those that have Vivara and the stores that -- the shoppings that have Vivara and those that don't have, we've seen a performance which is a little different between these two situations, which is very beneficial. Because we see that the stores where there is no Vivara store in the shopping center have an opportunity to grow bigger than those that are combined with -- that have both brands. So in the future, we're planning to work the brand to make Life more and more well known, a natural process. 2 or 3 years ago, when we launched Life, it took 3 years to reach a mature store. Today, it takes less. So it's only taking 1.5 years. So this means that more and more the brand has become better known and less dependent on the Vivara brand to endorse it. So for us, this -- we see this with very good eyes, to collect same-store sales, very important same-store sales for these stores and making it more and more well known in these places where there is no Vivara.

Next question is from Eric from Santander. Eric Huang.

From our side, there are two questions. Looking at the question, again, in the question of inventories, stocks looking at next year, at the moment in which you are -- have consumed a lot of this excess gold that you have on hand, how do you see the question of pass-through since you've had to start to repurchase -- make new purchases of gold? And what is the space for that? And how part of this stock -- this current stock should help you to maintain a dynamic which is more gradual of pass-throughs? Also looking at next year, we should have a certain acceleration in terms of openings in terms of Life stores. You commented about the qualification of labors -- workers for the stores and the expenses of sales, which is very much controlled. Marrying these two, how can we think about the expenses of sales for next year?

Due to the maturity of this and the impact of these, the jewelry, which is the most relevant, it's more -- the impact is more relevant due to the non-necessity of purchasing raw material in the first quarters. Of course, we're going to be very -- pay a lot of attention with the question of passing through prices so that we have no need to do this all at once, when we need to purchase gold. Of course, we'll be -- we've been -- we're studying a great deal about this internally, and we have a plan well addressed for next year of price pass-throughs, smaller increases during that cycle. For Life, the dynamic is the same, and we're going to do it during the next quarters. We're going to maintain the same way that we've done -- been doing that this year. We don't have raw material stocked. Then we have our strategic plan, a re-acceleration of these openings without giving any guidance, helps us a lot. In relation to SG&A, we have a very marginal impact. You also act, and we answered. If we have, in fact, an increase due to the low maturity level of these new stores and the openings that we've done at the end of this year are starting to gain more efficiency, compensating for this relationship. So, we have a margin. This marginal impact does not bother us.

A quick follow-up in relation to the Vivara performance. Can you give us a little more how the categories have of laboratory diamonds have contributed to the growth of you? And have you've seen any more relevant in the behavior of the consumer in this context of the increases in these gold items? Also, in the question of digital sales, there's been a good evolution there, but it's been a little bit below what we expected in the past. Even with the launch of the app in April, I wonder if it's matured over this quarter. I wanted to understand if Life is a little more representative in this channel and how you're thinking about the strategy of this channel in the last quarter of the year for Good Friday and -- for Black Friday and the end of the year sales -- year-end sales?

Let me add to your answer. And we see these three categories, as we mentioned at the beginning, adding the new stock, which is, we see this from our clients and it has made our volumes to continue. And so naturally, we have a very strong pair with the price of gold and the stronger end of the share of these products has helped our volumes to be maintained. So there, we're not opening exactly when each one of these categories will be open, but they have a great potential for growth, and they represent less than 10% of Vivara's sales. So this one, we're going to be doing several launches of these categories and our principal ambassadors. And we're also very confident with the acceptance by the public of these three brands. As far as e-commerce, we have had a good performance in the e-commerce. However, we still believe that there is several initiatives, we can increase even more the growth in the e-commerce world. We had several problems in the system last year, which made our fourth quarter of e-commerce not have such a high growth. So, we're very prepared with the integration of these systems in this quarter, I guarantee that all of the items that we have exclusively on the site. Beyond that, we also have considered several stores as hub stores and the stocks at these stores are available so that clients can go and see and even do a faster pickup of these items. This has happened more strongly during this quarter, the third quarter. And our app is even more having shares. And it's an initiative that we're betting a lot on, which is the personal shoppers. We've had excellent results in this channel -- in the sales channel. And by impressing that area, we can -- we have -- we're having faster growth in our e-commerce.

Our next question is from Joseph from JPMorgan. Ladies and gentlemen, we have a technical problem with Joseph and we're going to go to the next question. Next question is from Daniela.

I wanted to mention a question regarding the question of margins looking at the stock. If you could talk about the average cost of gold and silver until the third quarter of next year. How you're paying a premium on the gold that you melt down? So there should be some balance in the cost, your costs won't be so expensive.

Let's go. Let me address this with the gold, which I think is the most relevant factor. What we've seen in our plan for 2026 due to the non-necessity of purchasing gold, but also the increment of the week -- Gold Week, where we pay a little bit of this premium. So we have a correction in the average cost of our stock. What we've seen here is, as we pass-through this price, we have a relation in the pass-through of prices, which is very favorable to us. And without passing prices through in an aggressive way. So the possibility of gaining market share added to an efficiency of gross margins is very real for the next quarters.

Let me see if I can -- okay, that's good. The price, we had this curve, this cost curve, which accompanies the price. So you're trying to work with the replacement price of -- the replacement cost of gold.

The relationship is, is our capacity to pass-through the prices and the capacity that we have without being aggressive, without offending our quantities with the average cost of inventory is in relation of 2:1. So, we gain a good efficiency, a good level of efficiency from the standpoint of margin for next year in jewelry. That's our plan. And that's how we're going to be designing our plans for the next quarters.

To gain market share from raw material based on these prices are very strategic. To purchase gold and so our prices won't be very much -- will be out of date in terms of pass-throughs. Averaging with the entrance of Gold Week and the losses, which are very small. The loss on gold is less than 5% and much less the loss than the difference between the average cost that we have of this gold versus this spot. So, it's very favorable for us to do this melting process.

Our next question is from Daniela Bretthauer with HSBC.

Congratulations for your results for the quarter. Some questions in relation to the operating expenses and another question regarding the relationship of the strategy of anticipation of receivables. So, just to help us in the question of these projections going forward, do you have -- you had an increase in professional services, hired professional services as appears both in selling expenses and sales expenses as well as in the general and administrative expenses. Both went up a great deal. I know that the weight of the two in the total expenses is not the most important thing. However, I wanted to understand what is on that line? And what do you see -- how would you orient this in terms of projections? The other point, which is on the line of expenses are the expenses with marketing. In this quarter, you had about 3.7%, almost 4%, being that in the previous year, it was 2.5%. So, there was also an elevation in the marketing expenses. And I want to know if we should consider that for projections, this higher level going forward showing a good results, at least in the sales in the brands. Other expenses, with these BRL 31 million that was positive BRL 31 million in the line of expenses. These are my three questions, just to orient us of how to project going forward.

Okay. We did an anticipation in the second quarter, which brought in the receivables from the third to the second quarter, which had a positive impact on our cash flow in the second quarter and a negative impact on the third quarter. So, we chose this BRL 90 million, which anticipated from the third to the second quarter in round numbers, but -- so we have a bigger cash flow in the second quarter. The normal part is to consume cash in the third quarter, and we did burn a lot of cash in the third quarter, through our negotiations with suppliers and our actualization of our stocks. This anticipation was part of a project of lengthening out and stretching out the spreads of our debt. We had to do purchases of raw materials and metals using these advances, and we started to make these purchases in cash to get a better price. And we did this together with -- about BRL 300 million in this quarter, which is this 5-year period and but a reduction of a spread of 0.7. So, in the capital markets of debt, we're a AAA rating, and we're very happy with that issue. And with that, we don't have the need to make new anticipations as our cash flow is quite robust, and we're able to see that we've had an increase of BRL 150 million in gross debt, while our risk -- drawn risk was more than BRL 200 million, which is a reduction of cash that we've had in that period. As far as the services of third parties between selling and G&A. In selling, we had more suppliers who have helped us to push sales, bonuses and so forth. So that was what pushed the question of third-party services and selling. Having G&A, the principal point was the expenses with IT where we've had -- we're looking at it as CapEx. But in the fourth quarter of last year, we started to consider them and we considered in OpEx. So, in the third quarter, we have normally had this effect. In the first quarter of this year and in the third quarter, it's already been in smaller amounts because we have been very strongly negotiating with the suppliers, trying to reduce to the maximum our expenses with SG&A. We've had a lot of success on that front. Beyond the other things, essentially positive because we've had the recognition of a temporary credit of PIS/COFINS, which is the taxes, which is at its limit. So these are credits which we will had a discussion with the consultant, with the tax consultants and the law offices -- top law offices in Brazil who have given us the opportunity to take advantage of within a very conservative view, which is our policy of use of tax planning. As other -- we've done in other companies, we're doing and then we started doing in this quarter. As far as marketing, we've seen a more normalized line in this quarter. In the fourth quarter and third quarter of last year, we had a reduction -- an important reduction. So, we -- in this quarter within our normal flow of business, the next quarters going forward in the last quarters.

From the standpoint of conceptual standpoint, last year, we had an execution due to the good negotiations that we've done. We've been more efficient. So the -- however, for us, the idea is to have a good investment in the standpoint of our brand to continue with the brand, which is more and more stronger and stronger and more aspirational. So, we're going to maintain the same levels here, projections for the coming quarters as we have maintained. We've been more efficient, and we have the strategic pillars to maintain our brands very strong and very aspirational. So we don't see any -- we have some efficiencies here.

So thank you for your explanation. But just to close, so your expenses, your marketing expenses should maintain at the same level as the third quarter is going forward. And the question of the other revenues and expenses -- operational expenses was an increase -- was a onetime one-off for the questions of projections. We can maintain this in the current levels of 0.5% of revenue. Is that right? And the anticipation of receivables, we won't have again because you already restructured the profile of your debt and issued them and then we won't have any further need to anticipate. So you'll have a -- also have an effect on the operating expenses in the coming quarters.

Yes. Yes, the big. The biggest major indicators are conceptually good day to you all.

Our next question is from Alexandre Namioka of Morgan Stanley.

Congratulations on the results. I think we have to do some follow-up on the question of same-store sales of Life. If you could break down by segment between moments and collections. I think that you mentioned some initiatives that you're planning increasing the rate of innovation. If you could also comment about the difference in performance between these two categories and how we might be able to think about this. In moments, I think it was underperforming a bit in recent quarters. And then again, addressing the digital area, Felipe had asked about this channel. And in the quarter -- in the past quarter, you commented about the -- expanding into new channels. And if I'm not mistaken, you commented about eventual opening -- eventually opening a profile of TikTok Shop. If you could also talk about these initiatives of new channels within the digital strategy, that would be interesting for us to know.

Very good questions, Alexandre. Let's take a look from the standpoint sales of Life, break it down into two subcategories and the third one is commercial. Commercial connections and moments. When we look what we've been able to do very well done at the end of last year from the standpoint of innovation of volumes and launches for commercials and collections. So, already have performance of same-store sales, which is more evolved. And from the standpoint of moments, we have to break it down into two fronts, necklaces and collars. It's been suffering a little bit due to the lack of Disney. So we recovered those launches of the Disney products in the middle of September. Disney has been performing with almost 10% of our sales of necklaces. And so, we've been looking at that in the area of products, sales is the next route that we're going to attack from the standpoint of innovation. In general, we would like to -- and it will increase our indexes of innovation of Life. We understood that the next is the most common in fast fashion, which follows the current fashions and with prices that are a little bit more accessible, making it possible for people to play a little more at the time when they buy. Digital sales, it's a very important pillar. I'm sure it's a very important pillar for us over this next fourth quarter, but especially for the fourth quarter. There are some questions which need to be addressed. We have a very [Technical Difficulty] The second is to increase our rate of conversion, which we have a lot of opportunities to increase our conversion rate through better searches and a better client experience. And the third is in relation to new channels. We separate this into three fronts. The first one is to return to the marketplaces. We're finalizing some partnerships. We have an increase, which is very good from the standpoint of sales for the digital channel in this marketplace. Second of them is in relation to -- it's not a new channel, but it's very important for us, which is to increase the efficiency of CRM. We utilize it how we can better utilize that channel so that we are able to be more -- less dependent on paid media, bringing a more qualified public. And also, which our biggest bet is on the standpoint of consultative sales. We had BRL 0 of sales in this channel. We structured this channel, and it has performed very well and given us an important slice of our e-commerce sales and has structured itself to more than double the sales coming from this channel, which is a tendency for our business here. We understand that the future of digital sales here has a tremendous amount of opportunity, and we're very animated about that. Finally, we have the clothing of all the technology and structure, which we've been working with over the next few months in a way that we're able to support all of this operation and these digital channels.

There's no more questions. So we'll close this video conference of results for Vivara. The Investor Relations department is at your service for any other questions or doubts you might have. And have a great day. And I'm going to pass the word over to Elias and Icaro for their final comments.

Thank you all very much for this session. It's a pleasure to be here looking at these results with you. I want to thank you immensely all of our teams, our sales force, the factory, our office people, operational who have worked hard to deliver these results from the standpoint of [Technical Difficulty] Thank you for the sales and the same-store sales, especially independent of the scenario, which is a little more adverse scenario. We have delivered what we have committed to. And we thank you all publicly. And once again, Otavio is not with us due to a very special motive. He had a child this week. We wanted to offer this to all excellent, a great level of excellence. He'll be back with us soon. And we'll see you in our next session. Thank you all. Have a big hug. Thank you very much. Thank you. Good day. [Statements in English on this transcript were spoken by an interpreter present on the live call.]