Lavoro (ticker unavailable) has reported a slight revenue increase in its fiscal second quarter of 2024, with revenues reaching $618 million, a 1% rise from the previous year. Despite facing deflation in input prices which affected margins, the company saw volume growth in its Brazil Ag Retail segment and achieved market share gains.
The financial outlook for Lavoro remains steady, expecting a 25% decrease in Brazil's retail input market for the 2023-2024 crop year. The company remains positive, citing progress in the soybean harvest and a strong start to the safrinha corn planting season.
Although consolidated gross profit declined by 17% to $103 million, Lavoro is optimistic about future market recovery, supported by robust volume growth in retail operations in Brazil and Colombia, and revenue gains from its specialty fertilizer product, Integra, and the acquisition of Cromo Química.
Key Takeaways
- Lavoro's revenue increased by 1% to $618 million in the fiscal second quarter of 2024.
- Significant volume growth was seen in Brazil Ag Retail, with strong market share gains.
- Input price deflation impacted margins, leading to a 17% decrease in consolidated gross profit.
- The financial outlook projects a 25% decrease in the retail input market in Brazil for the 2023-2024 crop year.
- A 55% increase in sales of the specialty fertilizer product, Integra, contributed to revenue growth.
- The acquisition of Cromo Química added 5% to Crop Care segment revenue.
- Adjusted EBITDA and net profit both declined, with EBITDA at $40.1 million and net profit at $2.6 million.
Company Outlook
- Lavoro expects the second half of the year to be stronger, contingent on normalized climate conditions.
- The company is executing a hiring plan and expects the full benefit of new sales teams next year.
- Optimism remains for the second half of the year and the fundamentals of the Brazilian and South American markets.
Bearish Highlights
- The company faces challenges in maintaining gross margins due to competitive environments and unfavorable climate conditions.
- There was a notable decrease in adjusted EBITDA and net profit compared to the previous year.
Bullish Highlights
- Lavoro's Crop Care industrial division experienced double-digit growth in revenues and gross profit.
- The company's recent acquisition and product sales have contributed positively to revenue.
- Volume growth in retail operations in Brazil and market share gains in Colombia indicate resilience.
Misses
- Consolidated gross profit declined by 17% due to lower crop protection and fertilizer prices.
Q&A Highlights
- Lavoro has decentralized pricing decisions in Brazil and Colombia to specialized teams, while centralizing supplier negotiations to leverage scale.
- The company is hiring experienced sales consultants who are expected to drive accelerated growth.
- There is a compensation structure in place with a low fixed salary and a larger variable component based on sales.
Lavoro's earnings call highlighted both the challenges and opportunities the company faces in the agricultural retail sector. Despite input price deflation and a competitive market environment, the company's strategic initiatives, such as hiring experienced sales consultants and decentralizing pricing decisions, are aimed at fostering growth and maintaining a strong position in the Brazilian and South American markets. With optimism for the second half of the year and confidence in the company's fundamentals, Lavoro is poised to navigate the current market conditions and capitalize on the anticipated recovery.
InvestingPro Insights
Lavoro's recent fiscal report underscores a modest revenue uptick, yet InvestingPro data and tips reveal a nuanced picture of the company's performance and market position. With a market capitalization of $748.64 million, Lavoro's financial health is reflected in its revenue growth of 17.47% over the last twelve months as of Q1 2024, signaling a robust expansion despite the challenges faced in the agricultural sector.
InvestingPro Tips suggest that Lavoro's stock might be currently undervalued, as indicated by the RSI which suggests the stock is in oversold territory, and the fact that it is trading at a low revenue valuation multiple. These insights could be particularly valuable for investors considering the company's long-term potential in the Trading Companies & Distributors industry, where Lavoro is a prominent player.
However, not all indicators are positive. Analysts have revised their earnings downwards for the upcoming period, reflecting potential concerns about the company's near-term profitability. Indeed, the company is not expected to be profitable this year, and it has not been profitable over the last twelve months. This is further exemplified by a negative P/E ratio of -6.70, which worsens to -9.72 when adjusted for the last twelve months as of Q1 2024.
For readers interested in a deeper dive into Lavoro's financials and strategic positioning, InvestingPro offers additional insights. There are 9 more InvestingPro Tips available that could help investors make more informed decisions. To access these insights, visit https://www.investing.com/pro/LVRO and don't forget to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
Full transcript - TPB Acquisition oration I (LVRO) Q2 2024:
Operator: Welcome to Lavoro's Fiscal Second Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] A question-and-answer session will follow the formal presentation. Please note that this conference call is being recorded and a replay will be made available on the Company's Investor Relations website at ir.lavoroagro.com. I will now turn the conference over to Tigran Karapetian, Head of Investor Relations. Thank you. And you may begin.
Tigran Karapetian: Thank you for joining us today on Lavoro's fiscal 2024 second quarter earnings conference call or results ended December 2023. On today's call are our Chief Executive Officer, Ruy Cunha; and Chief Financial Officer, Julian Garrido. The Company has provided a supplemental earnings presentation on its Investor Relations website at ir.lavoroagro.com. That may be helpful in your analysis for the quarterly performance. Before we begin, please remember that during the course of this call, management may make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our future results and operational and financial position, industry and business trends, business strategy and market growth, among others. These statements are based on management's current expectations and beliefs and involve risks and uncertainties that could differ materially from actual events or those described in these forward-looking statements. Please refer to the Company's registration statement on Form F-1 filed with the SEC on March 23, 2023, or our report on Form 20-F for the period ended June 30, 2023, filed with the SEC. Please note that on today's call, management will refer to certain non-IFRS financial measures, including adjusted EBITDA, adjusted EBITDA margin, pro forma adjusted EBITDA, pro forma adjusted EBITDA margin among others. While the Company believes that these non-IFRS financial measures will provide useful information for investors, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with IFRS. Please refer to today's release for a reconciliation of non-IFRS measures to the most comparable measures prepared in accordance with the IFRS. I'd like now to turn the call over to Ruy Cunha, CEO.
Ruy Cunha: Thank you, Tigran. Good afternoon, and thanks, everyone for joining. I'll begin by touching upon the overall business landscape and the broader economic context, after which Julian will delve into our financial highlights, and I'll return for some concluding remarks. First, fiscal second quarter 2024 ended in December, Lavoro delivered revenues of US$618 million, marking a 1% increase compared to prior year periods, as volume growth led by market share gains helped to offset continued significant input price deflationary pressures in crop protection and fertilizers across our retail footprint. In our Brazil Ag Retail segment, second quarter volumes for crop protection, fertilizers and specialty products respectively grew 46%, 63%, and 29% year-over-year. The benefits of scale of our platform and strong execution from our commercial team led to another quarter of strong market share gains. Our strategic priorities of attracting seasonal technical sales representatives continue in its momentum. We concluded the second quarter with just over 1,040 RTVs in Brazil, an increase of 25% versus our first quarter. We anticipated positive contribution of these new hires to primarily materialize in our next fiscal year. Crop Care delivered a standout performance in the quarter as revenues and gross profits saw both year-over-year growth of more than 20% in spite of the challenging overall market environment and the adverse impact of El Nino to demand for biologicals in the quarter. Crop Care's share of portfolio consolidated gross profit continue to expand, reaching nearly 24% up from 16% in the prior year is further validates the importance of our vertical integrated business model. Second quarter consolidated gross profit of $103 million and adjusted EBITDA of $40 million decreased 17% and 48%, respectively over the prior year period as the headwinds from the industry-wide input price deflation in crop protection and fertilizers continue to adversely impact our margins. With that said, it's noteworthy to highlight the meaningful sequential improvement in the year-over-year changes to our margins from our first quarter to the second quarter. I'd like to spend a few moments here to explain certain key fundamental drivers to ag input distribution margins, as we had a lot of discussions on these important topic following our last earnings call where we briefly touched on them. Simply put, we generated gross margins by selling our inventory at a certain target markup over cost. The size of the markup depends on the nature of the product category with more technical or specialized products such as biologicals, foliar fertilizers, adjuvants or seeds, commanding premium margins relative to crop protection or fertilizers for instance. There are three critical factors that impact our gross margins. Number one is the price we pay to suppliers to purchase our inputs, which is effectively the COGS embedded in our inventory. Second is the price that we set for farmers, which is a function of localized supply and demand, and which is impacted by things such as weather, farmer profitability and sentiment, relative price competition, et cetera. And third, the overall pricing trend lines, whether inflationary or deflationary environment. This factor plays a role due to the time delay between when we purchase products to build inventory and when we sell our inventory. Our inventory days range between 90 to 130 depending on the seasonality, and there's some variability depending on the product category. In essence, our COGS tend to lag our average sales by three to five months. A deflationary environment acts as a headwind to gross margins so long as the trend line remains intact. For illustrative purpose, one would purchase an inventory at $100 with the goal of selling at $120 around the time of planting. Yet four months later, the prevailing retail price has decreased to $110 or $105. Once pricing flattens out both from suppliers through retailers and retailers through farmers, COGS gradually catch ups to retail prices as the higher cost inventory cycle is over. In a normal market environment, by which I mean an environment where input prices are not declining by 30%, 40% or even 60% year-over-year, such as what we experienced this year, the third factor of pricing tends to play a relatively minor role, which is manageable as farmers start placing purchase orders with retailers mostly in advance and this booking curves built as the crop season unfolds. In contrast, when the deflationary environment is as intense as we have witnessed in the past few quarters, this adverse pressure is difficult to mitigate. Moreover, Brazilian farmers have been uncharacteristically praising orders much close to the point of use, which has diminished the role that bookings and purchase orders played in providing retailers visibility. With all that said, the mechanics I just described will help to explain what is happening with our Brazil Ag Retail business. Our second quarter gross margins in Brazil saw a meaningful sequential improvement in the last year-over-year trends with margins contracting 510 basis points to 13.9% compared to a year-over-year decline of minus 1,070 basis points to 8.7% in our first quarter results. This improvement is largely explained by the mechanics I just described with local input prices from retailers to farmers having broadly stabilized in recent months and as we gradually cycle through our higher cost inventory driving an improvement in our COGS margins are consequently recovering. Sequentially, improvement was most pronounced in the product categories most affected by deflationary trends such as crop protection where second quarter gross margins year-over-year contraction went from minus 1,300 basis points in the first quarter to minus 206 basis points in the second quarter. To conclude, our financial outlook remains unchanged. Our market outlook remains consistent with our assessments in our last earnings call in late January. We continue to foresee a 25% decrease in Brazil's retail input market for 2023, 2024 crop year ending in June 2024. As previously mentioned, local input prices, strong retailers through farmers in Brazil have broadly stabilized through disparities remaining across various regions, influenced by the ongoing destocking of excess agrochemicals inventories. Encouragingly, the accelerated pace of progress of the first soybean harvest combined with recent favorable weather conditions have led to a strong start to safrinha corn planting season, which currently stands at 71% above the five-year average of 52%. Now, with that, I'll pass to Julian for further details on our financial results.
Julian Garrido: Thanks, Ruy. Good morning, afternoon, good evening, wherever you are. So let's cover our consolidated financial results for this fiscal second quarter 2024 ended on December 31, 2023. So let me start with the revenues. The consolidated revenue for the second quarter rose by 1% to $618.7 million as Ruy have mentioned before. In constant currency terms, the revenue decreased by 5%. The price splitting between inputs revenue and grains revenue, inputs revenue increased 1%, driven by volume growth expansion resulting from market share gain offsetting price declines. The grain revenue resulted an increase of 57%, driven by greater desire of our customers for entering into barter transactions. If I look at the rev by segment, the first segment, Brazil Ag Retail, revenue increased by 1% reflecting the unit volume growth in crop protection, fertilizer, specialty products, seeds, which increased by 46%, 63%, and 29%, respectively. These increases were offset by price deflation and negative product mix across all categories. Notably, due to the impact of El Nino, which decreased the mix of higher technology corn seed varieties and changes in farmers purchasing time, seed product revenue declined by 11% year-on-year. Once again, Lavoro gained share in the quarter, driven by good execution from our local commercial teams. Contribution from recently acquired companies Referencia and Coram together contributed to 6% to the overall revenue growth for the segment. Now taking a look at Latam Ag Retail, the revenue totaled $55.8 million, which is a 2% decrease from previous year of 17% decline in Colombian peso terms. This drop mainly due to challenges in fertilizer and crop protections distribution revenue, along with the lingering effects of discounting Paraquat the herbicide from a supplier product lineup. However, growth in specialty products, seeds and service sales as well as the Colombian peso's appreciation against the U.S. dollar and Brazil real partially offset its revenue declines. Last but not least, Crop Care recorded revenue of $72.8 million in the second quarter 2024, demonstrating a notable 26% increase compared to the prior year. This growth was driven by robust performance with this specialty fertilizer product Integra showing a remarkable 55% increase. Additionally, the recent acquisition of adjuvants and enhancer manufacturer Cromo Química contributed 5% to Crop Care segment revenue for the second quarter 2024. Now let's go and talk about consolidated gross profit. The consolidated gross profit for the quarter decreased by 17% to $103 million, gross margin contracted by 360 basis points to 16.7%, and the main driver was the steep price decline in crop protection and fertilizers in our Brazil Agriculture Retail segment dictated by Ruy before. Latam agriculture retail on the gross margin perspective declined by 230 basis points to 17.8%, driven by compression in crop protection and fertilizer distribution margins. And the gross margins of Crop Care retreated by 160 basis points to 35.3%, primarily due to unfavorable mix effects resulting from the performance of high margin biological products during the quarter. However, the financial contribution from the recently acquired Cromo Química, which has gross margin higher than the Crop Care average helped to offset some of these effects. The adjusted EBITDA in the second quarter 2024 was $40.1 million, down $37.4 million from the prior year quarter, while adjusted EBITDA margin contracted by 48.8% to 6.5%, again primarily influenced by the gross margin compression discussed earlier. The SG&A excluding the depreciation, amortization to sales ratio increased by 300 basis points to 11.3%, mainly due to higher investments as the hiring of new 291 RTVs have yet to contribute to our sales, and we also had the increase in the allowance for expected credit losses resulting from the impact of the El Nino and our expected payment schedule from farmer clients. All three operating segments saw negative year-over-year change in adjusted EBITDA as well as EBITDA. Adjustment items excluded from adjusted EBITDA increased by $1.5 million to $2.4 million for the second quarter 2024, due primarily to higher stock-based compensation expense of $0.5 million and an increase in related party consultancy services expenses in Q2 $0.9 million. Last but not least, the adjusted net profit was $2.6 million, a decline of $34.8 million over the prior year quarter, driven by the lower adjusted EBITDA, higher financial cost of $5.4 million, reflecting higher interest rates on trade payables, and it was partially offset by an increased positive contribution for our income tax. Now I revert back to Ruy.
Ruy Cunha: Thank you, Julian, and thank you all for participating in today's conference call and for your ongoing interest in our company progress. Allow me to highlight some key points from our discussion today. So our second quarter results underscore Lavoro's resilience in the face of challenging market conditions. Our retail operation in Brazil has demonstrated robust year-over-year volume growth even one of the most competitive market environments we have witnessed in over a decade. Similarly, our Colombian operation has also shown a comparable trend with notable gains in market share. Furthermore, our industrial division crop care achieved double-digit growth in both revenues and gross profit compared to previous year. And this growth was primarily driven by strong performances in specialty fertilizers and adjuvants, which offset any temporary setbacks experienced in the biological solution segment. Lavoro's significant volume gains validate the continued interest of farmers in investing in agricultural inputs for the solidifying Lavoro's position as their preferred partner. The confidence expressed by farmers is reinforced by the substantial investments the company is currently making to enhance its sales teams, placing Lavoro in advantageous position to capitalize on the anticipated market recovery. I firmly believe that the current market landscape has the potential to accelerate the ongoing transformation within the agricultural and retail sector in Brazil and South America. In this regard, I'm confident that Lavoro will maintain its prominent role in the market and continue to lead the way in driving positive changes. And with that, I'll come back to the operator for questions.
Operator: Thank you very much. Ladies and gentlemen, we will now begin with a question-and-answer session. [Operator Instructions] Our first question is from Bobby Burleson of Canaccord. Please go ahead.
Bobby Burleson: Hi. Thanks for taking my questions. So I guess the first one is can you just remind us, maybe some of the factors in addition to kind of the planning activity on the safrinha corn that you guys were watching throughout so far in calendar 2024 to decide whether or not you were able to kind of maintain the guidance that you laid out back in January. What were those main kind of things that you were – you guys were looking at?
Ruy Cunha: Hi, Bobby. Thanks for the question. So yes, a few components on that. So first, one of the key elements in driving our vision was the expectation regarding the overall market for this fiscal year. So we continue to see an overall decline in markets above 25%. And this has not changed too much, which was mainly driven by price. We also mentioned that the area of corn in the second crop will see a reduction as well as some expected reduction in productivity that would in consequence also affect farmers' decisions whether to invest in medium technology seed as opposed to higher technology seed. And this is also being confirmed. And also, some tendency to use lower, let's say, level of biological solutions. So I would say largely those were the main facts in addition to the normalization of the retail inventory. So all of that to say that those indicators, they seem to be progressing as we expected. I think on the positive note, we see that, as we mentioned, the planting of safrinha is advancing fast. That means that the time window for farmers through operating safrinha is going to be improving compared to what we expected originally. Okay? So this might encourage some last minute sales, but yet it is difficult to predict if this is going to have a meaningful impact on the sales volumes or not.
Bobby Burleson: Okay, great. And then just as a quick follow-up with the farmer balance sheets in Brazil, and we know that they tend to have healthier balance sheets, but there's definitely some concern on the part of grain traders that bankruptcy filings have increased in the region. And I'm just wondering your customer cohort in the small and medium farmer, how are they kind of positioned relative to where those filings are happening? Is there anything that's changing rapidly in terms of balance sheet health in the area? Thanks.
Julian Garrido: Yes. So what we saw, Bobby, is that some areas have been more affected by the drought, and I think this obviously had a more negative impact on farmers in Mato Grosso and in Goiás. I think those are the main affected areas. And in some cases with lower productivities, we have some farmers that – particularly those who rent the land, they are close to a breakeven point at this moment. Okay. So I think the most critical areas as Mato Grosso and part of [indiscernible]. With that being said, it's not generalized, is not a generalized problem. And the current expectations for the soy crop is something around 150 million tons, which is – it's still a pretty good number. So I would say in general, farmers should be able to meet their commitments. But yes, we'll see some areas of potential risks. I think another important factor Ruy just mentioned the chapter eleven, some farmers filing for bankruptcy. Indeed the number has increased. It has increased from, I would say, a relatively small number. We will have to look into the next month to see the extent of the problem. But right now, I think, it has not changed our perspective. If anything maybe a little bit better than we expected considering the current soy production. It can be Lavoro, I think all the, let's say, the negative effects related to bad debt provisions is already contemplated in our results. So it does not change the perspectives we have for the year.
Bobby Burleson: Okay. Thank you for that color.
Operator: Thank you very much. The next question is from Benjamin Theurer of Barclays (LON:BARC). Please go ahead.
Benjamin Theurer: Hi. Good afternoon and evening. Thanks for taking my question. Ruy, wanted to follow-up on the Crop Care business. And just to understand a little bit what you kind of looking into the second fiscal half. We obviously had a very soft first quarter, a nice sequential improvement in 2Q, but still down on a year-over-year basis. Now, normal seasonality, second half tends to be lower in Crop Care than first half. I wanted to understand, like within your guidance parameters, how do you think about Crop Care into the second half, just as you're coming out of this whole destocking environment over the last couple of quarters and what's kind of baked in for the guidance of specific Crop Care? And then I have a quick follow-up. Thank you.
Ruy Cunha: Okay. Hi, Ben, and thanks for the question. So I think there's two relevant impacts here. The first is a phasing effect, as you mentioned. So we had a very, let's say, slow start in the first quarter, accelerating the second quarter, and we expect further acceleration in the third and fourth quarter. But with that being said, the mix of Crop Care will probably change with lower participation of biologicals than what we had in last year. So the acceleration we'll see in the last quarters of the year is being mostly driven by specialty fertilizers and adjuvant business. Even though, as I mentioned, depending on the scenario of safrinha in the past that eventually occur, we might get some surprises or some positive surprises when it comes to biologics. But I would say overall the expectation for the biologics business this year is to be lower volumes than last year. So it's not only a fading effect. We're going to grow in those other categories, but the growth will partially offset the negative margin headwinds. Okay? So that is our current considerations.
Benjamin Theurer: Okay. Perfect. And then just quickly as well on the Latin American business, if we could dig in a little deeper into your expectations for the back half and how maybe some of the phenomena you've talked about with El Nino obviously impacting Brazil to a sizeable way, but it also does have an impact on Latam. I just wanted to understand what are the puts and takes here from a – just a Weber pattern and how this could potentially impact the Latam business into the second fiscal half because that was kind of a little bit of an underperformer, I guess, during the quarter as well.
Ruy Cunha: Yes. So Ben, on the Latam business, I think that the dynamic, even though they're subject to the same global trends, I think there's some different aspects to consider. The first one is our Latam business is being able to hold gross margins better than the Brazil retail business. And then the competitive environment is I would say less intense. So we are holding margins a little better. The challenge remains in sales partially driven by price, but is also partially being driven by unfavorable climate conditions that we're having in that region. So right now, we will depend – we expect the second half of the year to be considerably stronger than the first half. But that will also depend on, let's say, some of the climate conditions that are postponing farmers' decisions to buy to be normalized. But we do expect, I would say a stronger second half of the year.
Benjamin Theurer: Okay. Perfect. Thank you very much. I'll pass it on.
Operator: Thank you very much. The next question is from Vincent Anderson of Stifel. Please go ahead.
Vincent Anderson: Yes. Thanks. Good evening, gentlemen. I was just hoping to kind of get an update on how you feel about your sales staff. You hired a lot, but I'm curious how you're tracking against your three-year ramp up algorithm. And then just remind me how the performance compensation metrics work for them between revenues, volumes and gross profit dollars?
Julian Garrido: Hi, Vincent. We're executing our hiring. According to plan actually, I think we're even with better performance than we expected in the last month. So we saw a significant growth in the last quarter. But I'll say largely in line with what we expected to bring in new sales teams. Most of them – I mean, the compensation structure in the market is fairly standard. So we have I would say relatively low fixed salary, but then you have a relatively larger variable compensation, which is a proxy, something around 1% of their sales. Okay? What we expect is, I mean, some of those guys are already having a positive impact in sales, I would say mostly in safrinha. But the full benefit will only be achieved next year, right, with the full-year of working with us. I think the interesting thing is also that we're trying to hire experienced sales consultants, and we're being able to bring consultants with a very large potential order book with them. And those experienced sales consultants, they tend to be much more productive than the new ones, right? So usually takes between three to four years to have a sales consultant fully operational or to the maximum capacity. And many of those guys that are bringing right now, they're already experienced and they're already operating the region that they've been working on. So I think that we may experience, I would say, accelerated growth coming from those new sales guys in the next year.
Vincent Anderson: That's very helpful. Thank you. And then my other question was just, I'm trying to get a feel for your pricing model in these kinds of market conditions in terms of how you are able to monitor prices across all the growing regions you sell to and coordinate price and margin targets kind of from a centralized position down to your individual locations? Or is it still mostly a bottoms up effort and these individual locations are loosely held to a goal of some kind?
Julian Garrido: Yes. So we have – so in the way that we are organized, I'll say in Brazil, but it's also valid for Colombia. So we have a decentralized pricing decisions because we need to be mindful of the right pricing being performed at the market. So we have Brazil divided in clusters, and we have three major clusters in Brazil, North, South and East. And each one of those clusters, they have specialized marketing and pricing teams that are fully dedicated to looking to the overall farm gate price being performance by product. And then with that – and based on that, taking our price and markup decisions. So I'd say it's decentralized to the points that we need to have adequate pricing levels to where we compete. And then on the COGS side, I would say, it's probably more centralized because then we also need to leverage our scale and ability to discuss margin recomposition with suppliers at a central level, right? So we try to maximize that by combining our negotiations with suppliers on a central level and then taking tactical pricing decisions at the regional level.
Vincent Anderson: Okay. All right. No, that's helpful. I was trying to get a feel for when you have these kinds of price movements, if there's a mechanism to communicate that individual location should not sell below a certain price or anything like that. But what you described sounds pretty robust and I appreciate that detail.
Operator: Thank you very much. Ladies and gentlemen, we have reached the end of the question-and-answer session. And I would like to turn the call back to management for some closing remarks.
Ruy Cunha: Okay. Again, thank you all for your participation in the meeting. Again, I think once again, the company has shown the resilience of this platform. We're very excited about the second half of the year. We continue to be strong believers in the fundamentals of the Brazilian and the South American markets. And we'll keep you posted in new development. But right now, I think we're tracking in line with what we have already projected that's planned for this year. Thank you very much.
Operator: Thank you very much, sir. Ladies and gentlemen, that then concludes today's conference. Thank you for your participation and you may now disconnect your line.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.