Zamp S.A. (ZAMP3) Earnings Call Transcript & Summary

Good morning, and thank you for waiting. Welcome to the BK Brasil teleconference to discuss the results regarding the 4Q of 2021. Guests are Iuri Miranda, Gabriel Guimarães and the Investor Relations team. We inform that this event is being recorded. [Operator Instructions] This event is also being simultaneously transmitted via webcast and is accessible at www.burgerking.com.br/ri, where you will see this presentation. The slides will be controlled by us. The replay of this event will be available right after its closing. We would like to inform that this teleconference is being simultaneously translated to English in order to work with our foreign colleagues. Before continuing, we'd like to clarify that any declarations that are made during this teleconference regarding the business perspectives of BK Brasil, forecasts, operating targets, financial targets are built on assumptions and premises of the company as well as information currently available to BK Brasil. Future considerations are not guarantees of performance. They involve risks, uncertainties and assumptions because they deal with future events, therefore, depend on circumstances, which may or may not happen. Investors must understand that general conditions, sector conditions and other operating factors could affect future results of BK Brasil and could lead to results, which could materially differ from those expressed in this presentation. I'd like to now -- I'd like now to pass over to Iuri. Please, Iuri.

Thank you for the introduction, operator. Good morning, everyone. I hope you and your family are all safe. Thank you for the interest in our company and for taking part in this results call of the fourth Q 2021. I'm very proud to share with you the progress of our performance in this last and important quarter for our business. After a challenging beginning in 2021, where a few operating restrictions were once again placed due to the second wave of the pandemic, we saw that throughout the year, there had been a recovery and consistent progress as these restrictions were lifted. And in this quarter's report, we'll see that this recovery continued and showed vital signs in sales, productivity, gross margin and in profit margins, even if we hadn't gone back completely to the prepandemic levels. The dynamics of the digital channels that we have been seeing and developing in the last few years has continued to develop consistently. It's worth mentioning that even in a scenario where consumption on-premise is picking up, which still has traffic levels below the prepandemic levels, but it shows a very positive trend month after month. The sales in digital channels continue to grow. This overlap between the on-premise return of sales with the consistency of off-premise sales gives us a good level of confidence in terms of the resiliency and the incrementality of these channels at a time where we might have urban mobility levels more aligned with the postpandemic reality. This quick recovery also shows us the strength of our business even in moments, macroeconomic moments, which are challenging. This made it possible to have our brands show strong performance in all aspects in this quarter. After 2 years pressured by direct costs, we saw progress in all the levers that we created, trying to recover our gross margin levels aligned with what we had prior to the pandemic. At a few moments actually, even improved those levels given the environment where there is more consolidation and less competition with a good balance in the sales recovery, which took us to one of the best market share levels in the history of our company and an efficient management of gross margin, we saw the strength of operating leverage taking place in results. Technology has played out a fundamental role in this front because it speeds up sales, showing more frequency and average ticket increases and this helps us to become more efficient in our business. We believe a lot in this combination, so that in time, we would be able to continue expanding our business and seeking out the best returns. At the closing of this year, we also saw the opportunity of taking back our strong expansion project in both brands once the scenario becomes clearer. We continue to find excellent investment opportunities in this industry in consolidation. We saw investment potential in the entire national territory. And we are now looking at the new consumption reality with an important digital channel component. Our growth in 2021 and ahead will be focused on freestandings for the BURGER KING brand, food courts in POPEYES, but we start to understand the alternative formats like ghost kitchen and even hybrid kitchens might be scalable solutions in our platform in our development strategies. We've also developed different types of stores sized according to the local demand, which will allow us to optimize our investment and two, to maximize our returns. I also have to share with you my great satisfaction and pride, which after having built in about 10 years, 1 of the favorite fast food brands in Brazil. We, in this quarter, for POPEYES, a third favorite brand of fast food in the city of São Paulo. This achievement leaves us confident for the potential of this business in our ecosystem, and it is aligned with our vision over the potential chicken market in Brazil. It's incredible to see such a young brand of only 3 years of age being so well embraced during the pandemic. Throughout this year, we've also launched our ESG commitments until the year of 2030. Through the 3 pillars that we prioritize, our food, our DNA and our people, we established 16 commitments, which show our important role in the transformation of society and the construction of a better world. With that, I pass the word to my partner and CFO, Gabriel [ Guimarães, to give you ] more details over the company performance. Gabriel?

Thank you, Iuri. Good morning, everyone. Going to Slide 3 of the presentation, I'd like to talk about the performance of the company during the quarter. In the fourth quarter of 2021, we had our historical net income reaching BRL 913 million, a growth of 18% when compared to the same period of 2020. We closed the fourth quarter of 2021 with same-store sales of 10% for BURGER KING and 23% for POPEYES. And once again, we hit the record of income for digital channels getting to BRL 298 million, which corresponded to 33% of total company income. Sales recovery, our discipline [ in expenses ] and the advance in our digitalization allowed us to post the quarter with an adjusted EBITDA of BRL 177 million. And we also saw a strong cash generation of BRL 150 million. This result was to a net profit of which you see on the slide. Going to Slide 4, we have our growth. We opened up 18 restaurants; 2 are same stores, 3 are franchised and 3 POPEYES. During that time, we also had 2 BURGER KING transfers. Therefore, we closed the fourth Q with 945 restaurants, of which 736 are same stores [ of BURGER KING ] and POPEYES and 209 franchises of the BURGER KING brand. Next, we can see real images of new businesses in the quarter. The resiliency of our industry and the market reality, which is really underpenetrated in Brazil, has penetrated or contributed to a combination of companies. And there, you can see a strong pipeline of openings. As you can see in the images of our store openings, our business will continue to grow, focusing on freestandings for BURGER KING and food courts for POPEYES. But like said by Iuri, we are open to alternative solutions, which might be more efficient in terms of CapEx and with a new channel distribution accelerating returns. On the next slide, as I said before, our net operating revenue reached BRL 913 million in the quarter, which showed a growth of 18% versus the same period 2020. Our same-store sales in 1-year concept saw a growth of 10% for BK and 23% for PLK. And in a comparable vision of 2 years, we closed the year in positive territory for BK and with 18% for PLK. This is related to higher foot traffic in malls where we have most of our stores. And even with the recovery of on-premise consumption, you see -- still see a growth in our 2 brands showed us going back to what is considered reality, recovering traffic quickly and consistently. Just like with BK, we're very happy about the results from POPEYES. Like we said, in only 3 years of business, being 2 of them during a pandemic, we were elected the third most loved brand by the QSR market in São Paulo. On the next slide, will show you the performance of our digital channels with delivery, self-help totems. And this quarter, we saw the highest levels with a growth of 81% when compared to the fourth quarter of 2020, reaching 33% of share. If we include our apps, our number would get to 43% in this quarter. At POPEYES, a brand that grew with strong technology attributes, the digital channels represent 53% of total sales during 2021, which shows our capability to gather our market know-how in order to build POPEYES business. On this slide, we showed you our digital system. Now we have 11 million users on our CRM. And 4 million have made purchases, 2 million only in the fourth quarter. We've been building this database for 4 years, and we continue to add more data, more customer conversion data. We have almost 1/4 of all transactions identified, which could be a strong competitive advantage for our businesses because it allows us to have a more personal and closer relationship with our customers. The BK club (sic) [ Clube BK ], our loyalty program, closed the year with 3.7 million members and strong growth, which shows the level of engagement of our customers with our brand. We have noticed a very positive behavior from this group of customers, who consume our products with more frequency and at a higher average ticket. This combination associated with the increase in members in our loyalty program allowed us to double the representation from this channel in all of our other channels compared to the previous quarter, getting to 10% of total sales. Our app reached 40 million downloads in the fourth quarter of 2021 with assessments above any other player in our industry in Brazil in Android and iOS. For the self-help totems, they also had a great role in taking back our sales. With higher tickets and better experiences, we have been able to be more and more efficient as we will show on the next slide. In our delivery, we continue to see nominal sales growth throughout the quarters, which shows us strong evidence in terms of the incrementality of this channel once foot traffic is -- goes back to normal. We continue to work on logistics, and now we have approximately 70% of our restaurants already covered with the hybrid delivery system. This initiative has been fundamental for us to cover new areas to gain efficiency and to accelerate our own channel, which allows us access to our entire customer base. Finally, in terms of e-payments, we continue to see quick developments. And that represents 5% of total sales, all with lower MDR and with higher data retention. On the next slide, we can see the technology has allowed us to see trends in sales and costs. If on one hand, compared to the fourth quarter 2020, we grew 18% in sales with over 33 same stores. On the other hand, our expenses with personnel aligned with our digitalization strategy saw a drop of 6%. This drop still comes combined with an experience of lower friction, which we have noticed in our customers and so with better NPS levels. This digitalization level, 1/3 of the company sales go through digital channels allowed us to open yesterday our second nonhuman service, [ I guess you're saying ]. And it will be an important leverage or an employee-less office, I guess, or kitchen. Now going into our help desk, let's talk about our expenses with restaurant sales and G&A. At the end of the fourth quarter in 2021, the cost of goods sold reached 34.8% of revenue, a reduction of 560 basis points compared to the fourth quarter of 2020. As we have shared throughout the last few years, we've made important investments in initiatives, which helped us to sell in a more efficient manner. With lower exposure to discounts and better tickets, we've done revenue management, which also has allowed us to balance margins in a cost-challenging environment without impact on traffic and market share. And this quarter, also as part of our tireless work with all the vendors, we reaffirmed a long-term partnership, which impacted positively on the numbers in BRL 15 million. The sales restaurant expenses showed a drop of 360 basis points when compared to the same period in 2020, which shows the strong operating leverage of our business. Still in a challenging environment with the delivery share impacting the bakery in high levels of GPM, we were able to maintain our discipline and discretionary expenses, which aligned with the efficiency brought about by technology was fundamental towards our recovery. And this quarter, after a review of at least 1,000 contracts, we had a negative runoff impact in the amount of BRL 9 million. Our expenses with personnel had a drop of 200 basis points when compared to the fourth quarter of 2020, coming especially from our sales growth. Like we said, we've been investing in important fronts for the business. And in a moment where our sales reach their full potential with the recovery of foot traffic, we'll have important operating leverages. On the next slide, our adjusted EBITDA reached a historical record, closing the quarter with BRL 177 million, an increase of BRL 105 million when compared to the fourth quarter of 2020. Once again, we can see that the sales recovery allied to our efficiency disciplines, digitalization strategy, all have brought important benefits to the bottom line. At the end of the period, we also reached a net profit of BRL 54 million, a growth of BRL 121 million when compared to the fourth quarter. In December of 2021, the total gross debt of the company reached BRL 790 million, which combined to a total available cash of BRL 451 million led us to a net debt of BRL 340 million. The company continues with a strong capital framework, adequate for our operating leverage and to support the growth throughout the next few years. This leveraging is directly connected to the operating profit, especially in the first quarter. Looking at this, the company was able to get from this -- pay back all its creditors. We can see our CapEx and our operating cash flow. The total company investments reached in the quarter BRL 88 million, a slight drop when compared to the fourth quarter of 2020. Our quarter investments were fundamental to support our strong expansion plan, which closed the year with 34 same-store openings in all of our digital transformation fronts, which start to be a relevant part of this amount. You can see that the operating cash flow was this amount versus the cash generation of BRL 98 million in the fourth quarter of 2020. This performance is a reflex of the sales performance that the company presented during the quarter aligned to operating efficiency and the digitalization of the business. With this, I would like to pass the word to Iuri, who will talk about our ESG agenda disclosed during this last quarter of 2021 and our priorities for the year of 2022. Iuri?

Thank you, Gabriel. You might know that in our last call, we normally -- we formally disclosed our ESG commitments until 2030. Let's go to Slide #13. 16 commitments were made sustained in 3 pillars, which are directly connected to our business in the way that we can contribute to the developments of our society. I would like to share that last year, all same stores for BK and POPEYES recycled over 900,000 liters of oil. That way, we were able to guarantee that the oil used in our restaurants was 100% recycled by certified agents. Another important step we took in 2021 was our commitment of reducing 30% in greenhouse gases up to 2030. Throughout last year, we started the operation of distributed power generation engines, which can reduce over 1,000 tons of CO2 per year. Reminding you that 1,000 tons of CO2 is equal to the plantation of 6,000 trees per year. Finally, still in 2021, we acquired the WOB award seal with an important feminine representation that is in the upper management levels of the company. We also are seen as a company that shows equity in salaries and allows us to campaign regarding this topic, as you will see in the next slides. Still within our ESG commitments and our quality focus, in the last week, we launched our real food campaign through which we reinforce our commitment to real food and providing conservative free foods and free of artificial colorings. In our presentation on Slide 14, you will see the link to these 2 campaign videos. The delivery of these commitments reinforces our commitment to the best governance and sustainability practices, contributing to a more equalitarian society. And prior to going into Q&A, I would like to share with you our priorities for 2022, please. Let's go to Slide 15 of our presentation. Digital transformation will continue to be a priority. Working rapidly with squads and data, we believe in our capability to enhance the way we communicate with our customers and the way we work as a business. In 2022, as we see a much clearer scenario in terms of the pandemic, we will go back to execute our expansion plan for both brands, covering new geographies and increasing our footprint in other areas and increasing convenience for our customers. And with the taking back of foot traffic and the resilience of digital channels, we expect a significant sales bounce back and an operating leveraging in the cost -- in expenses and costs. Now I would like to go to Q&A. Operator?

[Operator Instructions] Our first question comes from Roberto Browne from Morgan Stanley.

The work you've been doing is just very notable, especially on gross margin. You got to record levels and even better than 2019. And under this reality, we still need the operating leverage and the maturity of a few initiatives. But in terms of margin, do you think this trend will continue? Or do you foresee any additional expenses? And do you see anything else that's going to be maintained or decrease or increase with the maturity of digital applications and the digital initiatives? Or do you think that with the maturity of the digital channels and the taking back of foot traffic, should we expect to see the sales expenses and G&A going back to prepandemic levels as their percentage of the income? I don't know if I was confusing on my question. I apologize for that.

No, it was fine. Don't worry about that. I hope you're well. Well, your question was very complete and it actually encompasses various aspects. There's not just one simple answer, but I'll try to summarize. First, in terms of EBITDA margin, what we see this year is that this year will be a strong recovery year versus 2020, '21, even if we still see a gradual sales increase. In terms of cost, well, these costs have affected the business. So there are things which already have impacted the business completely. You have inflation. You have a few things, which already have been accounted for. But on the other hand, you have a sale that's picking up eventually, gradually. So we'll see a very significant pickup in terms of 2021. But we think that after 2023, we will see margin levels, and now I'm talking about EBITDA margin, closer to the levels -- to the prepandemic levels. It's also important to say, Roberto, that there are 2 brands undergoing different moments. There is BK and POPEYES. And POPEYES independent or regardless of the surprising numbers, it is still a very young brand, which is still undergoing consolidation, and it ends up affecting the business around 60 to 100 basis points. So that will give you a more general overview in terms of the EBITDA margin. Now when you look at the other lines, there are costs which have been -- which already have affected us due to inflation and so on. But the actual sale with the return of foot traffic, we still haven't gone to foot traffic similar to prepandemic levels. But I think that the fourth quarter results do show the capability of our company in terms of being able to leverage once you get that sales return, that sales bounce back, that will help to mitigate the impact, the effect of these expenses, and it will help dilute fixed costs. On the other hand, since you already talked about technology, we've been talking about IT for a few semesters. Technology has helped us not only in terms of the restaurants, but you also have that information that Gabriel talked about. Let me look at the slide. Which slide was it? It was Slide 9 of our presentation, where he called your attention to less friction, more efficiency and a better NPS. And he shows the sales growth and productivity with this. You can see that productivity has increased. And you can see that costs have decreased despite the sales growth. And this comes from very efficient cost management from the team aligned with everything that we have placed in terms of technology to support us. And you'll see this happen more and more, and you'll see this helping us more and more. There are direct effects. For example, the BK loyalty club, that represents 10% of our sales already. And when you think about spend, which is the combination of the average ticket of that transaction with the frequency of such transaction, then it's something around 2 digits because it leaves in reals a -- no other transaction outside of the loyalty club. So these are things that are increasing. This represents 10% already. And you can see that we're seeking out alternative solutions to gain time -- to gain more margin as time goes by. So we're very confident that -- during these 2 years. Yes, there were new elements in our business. I think that the fast food market has transformed in the last 2 years. And in terms of new initiatives, they were necessary to compensate and offset some negative factors. Delivery becomes 15% of sales now. It's now part of the business. It wasn't what it was prior to the pandemic, which was over 50%, but we were looking at something between 15% and 20% now. But in terms of technology, other factors, scales, consolidation of the market, all this will make a difference for the companies that will be able to start to find other ways to make money and to mature those initiatives, and I'm sure eventually, will go back to prepandemic margin levels. Sorry for the long answer. But the question that was asked had various components as well.

No, no problem. That was a very long question as well. I just wanted to know if you can give us some more formal guidance of store openings since you're seeing a better environment. You're talking about strong opening pace. Can you give us something more?

Well, normally, we don't provide guidance, but I can tell you the following. In 2021, we opened 40 restaurants. It's a very significant number, and we did it very responsibly with cash management, especially during these last 2 years. So the company leaves these 2 years with an interesting cash position to leverage its expansion plan. And looking into 2022, our plan is really to heat up the base. You have seen POPEYES -- let me explain this better. You have seen people's preference for POPEYES. The openings we had in Rio de Janeiro are great. And you're going to start to see that we're going to go into the chicken market in other states this year as well. And in terms of BK with freestandings, the last freestandings, Gabriel talked about those and he said that we have -- the ones that we have opened have surprised us positively. In our opinion, there is a combination going on here of the entire development of the strategic development that we have been undertaking of having more street stores, which was brought about by what happened in the pandemic and the actual increase in the drive-through sales. Therefore, we should be around 70 to 90 new stores opened compared to the 40 in 2021.

Our next question comes from Marcella at Credit Suisse.

I have 2 actually. The first one is if you are able to talk about the profitability of digital sales overall the delivery channel. And the second question is we saw the highest levels of operating leverage in terms of personnel expenses, which reached levels below 14% of sales compared to a historical average of 15% to 16% in the fourth quarter. Regardless of the quarterly seasonality, how can we think about the dynamics of that number from here forward? We know about digital efficiencies and what that has brought in terms of benefits to that cost line, but how do you see that going forward? And is there room for more operational leveraging?

I hope you're well. Thank you so much for your questions. Let me start with the last one. Your question was very good because you compared the 14 with historical averages, and you already talked about you focus on the seasonality. Of course, the last quarter in the year shows higher sales, which leads us to a labor expense which is a bit higher, which is less than the other quarters when -- in percentages. But even comparing with other quarters, we still see something around 100 to 150 basis points better than the same periods of last year's. Technology has helped us a lot. And when I talk about technology, I'm not talking about only front-end technology, just the customer-facing technology. When we talk about the self-service kiosks and when we look at BK Express, where you can take your order and then you go just to the kitchen afterwards. But we've been evolving. And I would say, Marcella, that this is a very interesting white space from the actual balcony to the inside. All of our projects in terms of product delivery as well as kitchens are 2 things that in the future we'll talk more about, and I do see great opportunities there. In terms of pressure, because I can't just say that everything is great, but in terms of pressure, what we see this year is that we've had 2 years that based on the country's situation, we had agreements of -- union agreements at lower levels. Union agreements were actually less -- to people wanting to keep their employment safety and so on. And we look at 2022, especially a year where there is election, a few movements going on, where we might see a pressure from union agreements, salary agreements, which might lead to impact. So we're still going to grow in terms of technology with more self-help kiosks, advancing in deliveries from the balcony inward and in the kitchen -- at the kitchen level. And basically, we'll have to look at these union agreements and see how that pans out in 2022. In terms of delivery and the profitability of digital sales, I talked about the profitability that we see in BK club. When you look at the average ticket plus frequency already removing costs, like the administration costs, what a member leaves us in terms of reals at the end of the month is something in the double digits, better than what a consumer who's not in the loyalty club leaves us. So that's how you can use technology not only in 1 variable, but in this case, I told you about 3 variables, the ticket many times. You can suggest what the consumer to buy through an upgrade, utilizing their points. That will lead to higher frequency and already rebating the administration costs of the program -- offsetting the administration costs of the program in my calculation. And you can see that 15% of our sales come from delivery. We're looking at the reality of the business here. The take rate, the movement that we -- the initiative we have taken, like Gabriel said, we've tried to balance between aggregators and types of offers as well. Gabriel talked about hybrid delivery or 1P. And what 1P means is proprietary. Proprietary means the marketplace is ours and the last mile could be someone else's, but the marketplace is ours. And when he talks about hybrid delivery, it's when we see an aggregator where we have a marketplace just with the aggregator, but the aggregator doesn't take the last mile and thus, also allows us to have a take rate, which is more interesting. So like Gabriel said, we're at 70% of our chain with a solution, be it a hybrid solution or a proprietary solution. I don't know if you remember, but last year, we talked a lot about the project that we had of going forward in a last-mile solution, which would allow us to leave the full service model. This allows us to have a lower take rate with the hybrid service or with our own delivery than with full service. Therefore, we're going to continue working on the balance in regions where it's not possible to bring the hybrid model and the last-mile solution is in the aggregator's hands. Then of course, we'll try to bring some kind of incrementality. We'll try to get some incrementality. But in geographies where we have the last mile, that -- those regions are growing month after month, and we'll try to get higher balance between hybrid and proprietary marketplaces.

Our next question comes from Thiago Bortoluci, Goldman Sachs.

Congratulations on your performance. The first question is a follow-up, the coming of same-store sales. Can you at least tell us qualitatively for BK, what was the drop in same-store sales? And I saw that you mentioned the gain of share. Can you tell us the size of that gain? And the second question is regarding coupons. Gabriel said that coupons represented 10% of sales. How should we think about the way -- the representation of coupons in your future sales? And how should we see the recurrency of these consumers, their loyalty to the brand in the future?

Thiago, thank you for your question. Well, I'm going to begin, Iuri, feel free to complement my answer. Well, we've talked a lot about the ticket growth as time goes by. This ticket growth comes from the reduction to discounts, reduction to the exposure in discounts. And we have seen more items on the trays due to digital delivery, the BK club and et cetera. When we gave the BK disclosure still showing positive same-store sales, I would tell you that we're still lagging in traffic, something around 20% to 25% during the quarter. And in our perspective, when Iuri talks about operating leverage, that represents great opportunity since we see the urban mobility levels going back to prepandemic levels, despite not getting to the same 100% that we saw back then that it get at least closer to the historical reality. We saw a series of countries getting to 90%, 95% of regular foot traffic coming back. And so there's a good expectation that once that foot traffic goes back and gets closer to historical levels, we'll get that increment in average ticket, which is brought about by price in increased number of items on the tray, which will lead to same-store sales above what we have today. And in terms of February, going towards a more positive trend. Therefore, February starts to be one of the best months that we see in comparable terms with the last 3, 4 months where our -- the scenario is a bit more normal. So in a certain way, everything that's been done in revenue management with data and intelligence has been absorbed reasonably well by our consumers. And when Iuri talks about market share, I think that's the message, we can pass on prices, readjust the strategy without losing traffic and protecting our market share, which gets to one of our highest historical levels. In terms of your second question, you're talking about the share of coupons in our business, right? Sure. We talked about 33% of our income coming from digital channels. There are some players that provide disclosure, especially on digital coupons. In that standpoint, they represent end points in our revenue. And the question has less to do with the share of coupons in the total business, but actually, I think you want to know how assertive that coupon is in our business. How can I -- regardless of its share in the business, how can we get the right price level for the right customer with the right profitability? If we have that equation well defined, supported by our entire CRM and our business intelligence, if it's 10%, 15% or some number different than that, at the end of the day, what we are prioritizing is how can we interact with the consumer in a personalized manner which increases this consumer's frequency. And as his lifetime goes on, as he interacts with the brand, he becomes more profitable. Therefore, our strategy, we have much more to do with that than really to have something defined, a defined target, whether it be 10%, 15% or 20%. I would say one additional thing, and this has to do with your third question, how do we see the loyalty data for the brand. For us, what has happened and continues to happen is a consolidation of the QSR market. Any analysis at the beginning of the company showed this trend, not only in Brazil this happened. On the streets, you can see how many smaller businesses were not able to forgo the pandemic and went bankrupt. Stores at the mall had a bit more capability, but we do see lots of vacancies in malls happening. New brands coming up, that is true. But even with new brands coming up, and this is the point about loyalty, that's why we believe that this is an important consolidation period. Once foot traffic goes back, when you go to a food court and you go through a drive-through on the street and you see a brand that is preferred, a brand which is renowned, a brand which has positioned itself and has communicated to the consumer, which builds rapport with the customer, which builds great rapport with the customer, which show -- which is a modern company, the quality of the products as well -- we're not just investing in new restaurants or productivity. We had a recent campaign, the real food campaign. We were pioneering and removing colorings from most of our menu. Therefore, we are building a business. And in an environment like this, we believe in the loyalty of the customer. This is so -- this is true so much so because if you look at any loyalty program, how can -- how many companies can create a loyalty program from 0 to -- from scratch, from 0 to 6 months, they're already having over 4.3 million subscribers or downloads, I should say, and members actually as well. And that represents over 10% of sales. That has a name, loyalty. It's because the consumer really does see value in that loyalty program. And I can tell you that -- with lots of confidence, that is happening in BURGER KING. And if you remember, one of my main comments is the pride that the team has of a chicken brand with 3 years of operation, 100% based in malls still, and it went over 2 years of pandemic. In its first 3 years of operation, already becoming the third most preferred brand, the 3 -- the third most preferred fast food brand in the biggest market in Latin America. So this gets us really excited. All of the initiatives that we're creating towards personalization of the offer, the quality of the product, the image brand of the restaurants, the NPS levels, this is a combination of factors which has attracted the consumer and has generated this loyalty. We don't see a reason for this being any different in the coming months or years.

Our next question comes from [ Vinicius ] from Bank of America.

Iuri, Gabriel, congrats on the performance. I wanted to ask 3 questions. The first one is about the operation without any service people. If you could talk about this model and how you are thinking about applying this in new stores, other stores. And the second one has to do with all the enhancements in user interface. And what can we expect in terms of these digital initiatives in 2022? And in terms of store openings, how flexible are you with following the expansion opening plan in the number of stores?

All right. Thank you for that question. Well, our operation without any human servers was the first one. We actually did -- had our second store, a freestanding, the team set up an adaptation program for freestanding. Imagine, the store inaugurated a serviceless helper or a 100% digital store. So that's really fresh. I mean they just opened yesterday. It's a beautiful store here in São Paulo. From our first food court's experience with these digital stores, I can tell you that the experience in the kiosks are fundamental. In the first store that we had, it had something -- around 2 months ago or 2.5 months ago, we're already at a second version of the user experience already expanding or balancing the order and the delivery areas there in the restaurant, and these changes have already been implemented in this freestanding. It's interesting to see that the NPS level, which has been measured a lot at this store is higher than an NPS at a traditional store. And this is explained by the user experience during their order. That's why we've invested in that, the flow of the screens. And we're doing a series of enhancements. Already going into our second question of what can be expected in terms of digital for 2022, I would tell you that perhaps today, in terms of digital initiatives, we're a company in the Brazilian market which does lots of things which are differentiated, but I will tell you that we're just getting started, in our point of view. There are many projects ongoing. And in terms of digital initiatives, the development is not linear, it's exponential. BK club is an example, from 0 to 4.7 million members in 6, 7 months. That's an exponential growth. And so what you will see are many other initiatives. And like I said, not only at the front end level but also at the back end, the back-office level, you will see initiatives in terms of product dispatch. You'll see initiatives for inside the kitchen. And we'll see lots of developments in terms of personalization. We created a data lake with the CRM with lots of data, a huge data set. We started in the end of 2020. We rolled it out to all the restaurants at the end of 2020. In 2021, we collected and tested some data. We fine-tuned our customer profiles, which helped us with revenue management, but 25% of our sales have already been identified. And this is still an arena where we still have a lot to do compared to the other benchmarks abroad. Therefore, customization and new initiatives is what you'll see in terms of tech. And last, in terms of MFDA, I can say that 2 years of the pandemic, 12 years developing our franchisers, complying with our contract responsibilities every year during the last 12 years, including these last 2 pandemic years, with a win-win relationship, we do like to work with both RBI brands. And yes, we do understand that what happened with the pandemic, there was a reset of opening targets, and we're very comfortable with our investment capacity, capital allocation capacity and everything is renegotiated and set. There's nothing pending with RBI. Therefore, I would tell you that, that's taken care of. Well, guys, I guess we can now close our Q&A. And once again, I would like to thank you for dedicating over 60 minutes of your time, for your interest in the company results after 2 years of us talking about how we have been preparing to leave the pandemic stronger, leave stronger during this consolidation period. You can see that the third and fourth quarter show us going in that direction, and we're working very hard so that 2022 become even better. I hope you all have a great day, a great carnival, which we'll have in the future. Thank you all. Bye-bye.

The BK Brasil teleconference is done. Thank you for your participation. Have a great afternoon. Thank you for using Chorus Call. [Statements in English on this transcript were spoken by an interpreter present on the live call.]