Hi, everyone. Welcome all to our Azul Day. I'm Thais Haberli, the Head of IR of Azul. Has been over six years since our IPO, so it's great to be here at the New York Stock Exchange, so thank you all. Today, presenting, we have John Rodgerson, our CEO, Abhi Shah, our President, and Alex Malfitani, our CFO. The presentation is available in our IR website, and we have the Q&A after the presentation. So, we have a plan of time for the questions. So, I will turn the presentation over to John. John? Thanks, Thais, and welcome, everybody, and especially all the people that are online, kind of, listening today. Thais highlighted it was just over six years ago that we took the company public, and in many aspects, this is a re-IPO of the company, right? And so on the backside of COVID, and so we're gonna walk through everything we've done to build this unbelievably great airline, and how much stronger we are today from that initial public offering that we did in 2017. So we're gonna kind of walk you through kind of all those aspects. We're gonna talk a lot about valuation today. Obviously, kind of the restructuring of the balance sheet that we did, but more importantly, the strength of the core business, and the core business is doing phenomenally well. And so Abhi will walk you through the revenue trends and very different than what you're seeing elsewhere in the world. But, you know, the Azul story really starts with, the network that we have, the flexible fleet that we have, as well as our culture and our people, and we'll talk a lot about that today. And we are in the part of the world that's growing and growing substantially, and Brazil is still very under-penetrated, and we'll walk you through that. But take a look at this network, right? When we went public, I think we had just over 90 destinations served, and now there's 155 destinations domestically, seven internationally, about 1,000 flights a day. And so this airline is significantly larger today than it was in 2016, and significantly stronger. But I think the key thing that I want to share with you is that we're the only carrier in 81% of our routes. And so a lot of people thought that as Azul grew and Azul got larger narrow-body aircraft, like the A320s and the A321s, that we would have overlap with our competitors. The exact opposite has happened, and Abhi will kind of walk through our network strategy and how that works. Today, we're gonna have the opportunity to talk about all these different business units that we have, right? Obviously, the core airline, but we also have a regional operation that provides pilots for us and tax relief inside of the country. We've launched Azul TecOps, our loyalty business, as well as our packaging business, vacations, and our logistics business. And when we went public, a lot of these other businesses were very small. But now as we're kind of doing the re-IPO of Azul, we want to walk you through, in detail, everything that we've done and how we've grown these businesses. And so, you know, we're not talking anymore about COVID. We're not talking anymore about wearing masks, and so now we can talk about the core business, and, you know, it all starts with the strong airline and network that we have, but we're gonna show you just how strong these businesses are around it. So just to kind of walk through the airline's history as a public company, we went public in 2017, as I talked about. We delivered, or I should say, we over-delivered on everything we committed to the market, and the market rewarded us for that, and we're gonna walk you through that. We've been in three years of what I would call COVID hell, but now we're on the backside of COVID hell, and now we have the opportunity to tell a story that's much better than the story we had in 2016 for this re-IPO. You know, we were joking the other day that our existence... This airline is about 15 years old, but we've existed in COVID as a public company more than we've existed outside of COVID. Think about that for a second, right? Since we've gone public, we've lived in this COVID world for a lot longer than we've lived outside of the COVID world. And so I wanna kind of just remind everybody, we have a lot of the sell- side analysts in the room here and online, but when we went public in 2016, that was the size of the airline in terms of ASKs. That was the size of the revenue of the airline, and that was our EBITDA, okay? And what we told the market is that we would grow the business, and we would grow the business in terms of ASKs, in terms of revenue, and in terms of EBITDA. And you can see we did that, right? So we grew the business in terms of seats in the market by about 56%. Net revenues were up 71%, but take a look at what happened with EBITDA, right? There's not a lot of airline stories out there that have grown their businesses by 50%, but they've more than doubled EBITDA. What that did was, the stock reacted accordingly, right? The stock was up 3x from the day that we went public, and that's as a result of a company that delivered on its promises. A company that came out and said, "We're gonna do this," and we actually did it, and we actually did more than what the market was expecting. You know, every time we had an earnings call, we delivered more than what, you know, the sell- side was projecting. Now we just wanted to kind of share, you know, a little bit of where we are today, the size of the airline, relative to where it was in 2016. So now the airline is 2x the size, you can see in terms of ASKs. Our revenue is 3x. This airline is 3x larger than it was in 2016, and our EBITDA is 3x more, right? And so, you know, and Alex, you know, likes to kind of say this and, you know, we're gonna be on the road for the next month, kind of, doing this re-IPO of the company. But, you know, you could buy the airline today. That's 3x the EBITDA for half the price of what we sold at the IPO, if you think about that, right? And so it's a phenomenal story as to where we are today. And what's contributing to this EBITDA, and what's contributing to the revenues to be so strong, is a lot of these business units, right? So TudoAzul today is six times the size it was in 2016. Six times the size. Azul Vacations, our packaging business, is 12x what it was, and Azul Cargo is also significantly larger at 8x what it was, okay? And so, you know, kind of going back to the story overall, this was our EBITDA trajectory from when we went public, and that was our stock price, okay? Where we are today is quite different. Take a look at what's happened. As our EBITDA has grown, our stock price hasn't moved yet, because everybody's been focused on the balance sheet and what we've done and, you know, looking at trends in the United States with the weakening of the revenue environment. And so the airlines have been beat up quite a bit. So we're gonna kind of walk you through this story and how much upside really you have in the Azul story going forward. Another kind of interesting thing that I wanted to highlight at the beginning, and you'll have the opportunity to, well, to kind of talk through some of this stuff, is that obviously the stock price has not yet recovered to the levels it was pre-COVID. But take a look at this, right? That's what the stock had done. That's what the stock is in USD today. But let's take a look at just trading multiples. And I understand that obviously, trading multiples have compressed, interest rates are higher, and that's happened across the board. But Azul today is a stock that's trading at a discount to a trading multiple that historically has, has traded at a premium to other Latin American peers. Doesn't really make sense, right, if you think about it. So you can see, you know, no one's suggesting that we're gonna be back to an 8x multiple tomorrow, right? But that shows you how much runway the opportunity is and really what we're gonna talk about today. But it all starts with Brazil, and, you know, I've been in Brazil for 15 years. I think the number one question we got on the roadshow for myself, Abhi, and Alex was: "So when you leaving Brazil? When are you leaving Brazil? When are the gringos leaving? When are the-- When are you leaving Brazil?" Right? So the reality is every single one of us is still here. The same management team that took the company public in 2016 is still at the company, because the opportunity in Brazil is better than ever. We're gonna kind of walk you through that really quickly. Take a look at this chart today. Brazilians travel less than Colombians, less than Chileans, less than Mexicans, and obviously a lot less than the developed world in the United States and Europe. But, you know, 18% of the population is traveling via air and 82% on buses, right? It's a country, folks, that's the size of the continental United States, that has over 220 million people, and it's a country where the GDP estimate has tripled from where it was a year ago. The GDP estimate has tripled from where it is a year ago. Tremendous opportunity. What does that mean for Azul, right? If we get the country to travel just as much as our Latin American peers, like Mexico or Colombia, look at how many more aircraft we need. We need three more Azuls in the country just to get where it is in Colombia. It's pretty remarkable when you think about the growth potential that Brazil has today, and it's pretty remarkable when you see what our average fares have done in the recent months and see how much opportunity exists. So, you know, with that, I'm gonna hand it over to our President, Abhi, who's built the best network in Brazil, and I would say in the world, and have him walk you through the details of what our network looks like. Thanks, John. Great to see you all today. I think I'll be over here. Obviously, the network is something that I think is one of our key competitive advantages, and it's something that was designed to be different, and we started it to be very, very different 15 years ago, and it—I think it's only gotten stronger. It's a network that's very diversified, so our competition is very focused in three cities in Brazil. We are very diversified across all the geographies in the country. We access different demand via our flexible fleet and via our hub and spoke and our network structure. And we also access the parts of Brazil that are growing the fastest, and I'll show you that as well. So it's a network that's designed to be different, and as we have grown, continues to be different and continues to get stronger. Our route leadership, and this is something that back then, when we went public, people thought, well, as you grow, you will have to encroach upon the competition. You will have more competition. And actually, the opposite has happened. If you look at our leadership position in our network, markets that we are alone, routes that we have the most frequency, that percentage has actually increased over time for a couple of reasons. As we have grown, the network has gotten stronger, the connectivity that we offer is stronger. As we've gotten more fuel-efficient aircraft, it's harder and harder for the competition to enter to attack us in our markets. And so we've actually gotten our network is more defensive, more robust, more resilient. And again, we want to fly. Our aim is to grow the market. Our aim is not to steal from the competition. Our aim is not to attack anybody, anywhere else. It's to grow the market. And so it's different, and we continue to grow in that philosophy, and that philosophy will continue for the years to come. You can see our strength, where we fly. We like to fly where we are strong, and we like to be strong where we fly. So, the number of destinations that we have in our top ten airports, our second-largest city has more destinations served than the largest international airport in São Paulo, for example. And so we use this combination of destinations, of frequencies, of fleet flexibility, of connectivity, to really drive that revenue performance. It gives us pricing power, it gives us loyalty among our customers, and this really is a competitive and structural advantage that's very, very difficult to replicate. The longer that we continue, the more that we grow in these markets, the more entrenched we become, the harder it is, the more defensive we are, and the harder it is for anybody to enter these markets. So it really is a way of creating discipline in the market overall. This is a great map that shows where we grow, where our exposure is all over Brazil. If you look into the Midwest, that's the agro region of Brazil. The North, Northeast has infrastructure, has mining, leisure destinations, and the more traditional parts of Brazil, São Paulo, Rio, they always had great access to air service, right? 15 years ago, nobody said, "Well, São Paulo to Brasília needs more flights." That wasn't the complaint. But where we fly to, Campinas, Belo Horizonte, Recife, where I'll show you later on, that's where the market was underserved, and that's what we have grown over the last 15 years. And if you look on this slide here, you can see how our growth is so distributed. It's not focused in just one geography, and this allows us to connect... This is all part of the connectivity, it's all part of the flexible fleet, and it's all part of the fact that 86% of our routes continue to have no nonstop competition, and that number has only increased over time. So it is broad-based growth, broad-based connectivity, using the fleet as the tool to enable that to happen and really create something that's very, very different and very, very distinct, and still has a lot of growth, a lot of profitable growth ahead of it. Our primary hub is in Campinas, which is the Newark of, São Paulo, if you will. We have three hubs, three large hubs. You can compare them to Newark, to Houston and San Francisco, kind of East Coast, a mid-continent, and sort of a West Coast, Northeast hub. And the key here, the key of each one of these, is that they access different demand. They're not just replicating one to the other. They have different destinations, they have different equipment types, they have different routes, different demographics, and each one is designed to do something different. So our Campinas, our São Paulo hub, is for the South, Southeast of Brazil. It's where the majority of our international network is, the South, Southeast, Southwest, and really accessing that corporate demand that exists in the southern part of the country and taking it all over the country and onto the U.S. and Europe as well. 177 departures, 64 destinations, by far the largest single airline hub, domestic hub in South America. Recife is our Northeast or West Coast hub, if you will, accessing all of the capitals in the Northeast of the country. Remember, as John said, Brazil is the size of the continental U.S., and so you have completely different demand, different demographics, and different travel patterns from one hub to the other. We do have flights to the U.S. as well from Recife, but the job of the Northeast hub is to connect the Northeast region with itself, give it access to the rest of the country, but really allow convenient, flexible options in that region. We talk about the competitive aspect of the hubs as well. Yeah, and you can see on the right, in each of these graphs, Belo Horizonte here, Recife, and Campinas, how we compare to our competition and how strong we are, how dominant we are. And again, this is something that was built over time in each of these locations. It's a combination of connectivity, combination of destinations, and fleet flexibility. It's small airplanes connecting to medium-sized airplanes, connecting to large airplanes and even larger in the case of international. And you can see over time, and I think this is a merit, actually, to the discipline that's in the market, right? Each airline is focusing where they are strong, and you can see from these graphs, we're focusing where we are strong, and the competition is focusing where they are strong. So it's a merit to our resiliency and how what advantages we have in our network, but also the fact that the industry overall is well-disciplined, and each airline is focusing on what works for them. And finally, Belo Horizonte is our mid-continent hub. A lot of mining demand, a lot of energy demand here, and really a good gateway to the north of the country, slightly shorter distances, and great demand to the U.S. as well, and the northeast of the U.S. as well. For the first time ever, Belo Horizonte will have over 100 daily departures, and again, 54 nonstop destinations is larger than the largest international airport in São Paulo in terms of destinations. So, these three hubs really form the backbone of our network in terms of driving connectivity through the network, and it's a combination of destinations, frequencies, and the fleet flexibility, which we'll talk about later. Finally, in Congonhas, this was a big addition to our network this year. We were always in Congonhas, but in somewhat of a timid manner. Thanks to new slot availability this year, we've now more than doubled our presence in the São Paulo Downtown Airport. Local demand, very strong corporate demand, and the key to Congonhas is it allows us to access customers that normally wouldn't fly Azul. Our presence in downtown São Paulo historically has been small. Now, with this more than doubling our presence, we're able to access customers who can fly us for the first time, whether it's from Congonhas to the capital, Brasília, or to Rio, or to any of the top corporate destinations that we fly. The next week, they can go to Europe, or they can go to the U.S., or access our loyalty program, our vacations business. So I think of it as a way for customers to enter the Azul universe. It's, it's a doorway for customers to try us, enroll in our program, in our vacations business, and really experience all of the products and services that we have to offer. So we have a great list of nonstop destinations, but also lots of connecting destinations. But really, it's a way to access great demographics and have these customers try us and enter into our universe. You know, John, John talked about the fact that we've been here for the last 15 years, and the E2 is one reason why I'm so excited that we—as we continue to explore and develop this market. We have 17 E2s now. We'll have three more by the end of this year, hopefully another 15 by the end of next year. And so this E2 really unlocks the next stage of network development in Brazil. It's gonna allow us to fly routes that nobody could ever do before. And why is that? It's fuel efficiency. Fuel efficiency and size. 136 seats, burning 18% less fuel. The fuel... The overall cost per seat is significantly lower, but the overall cost per trip is significantly lower. You're talking about flying a larger airplane, but spending less while you're doing it. And this allows us to access markets, access routes, access utilization of the aircraft that would otherwise not be possible. And so just right over here, we have 80 examples of routes that are not served by anyone today, and we will have the opportunity to do so over the next couple of years. And again, these routes are not in isolation. You cannot just add a route and hope it's gonna work. It's part of the network structure. It's part of the multiple hubs, and the broad growth, and the destinations that we have all over the country. So it really is, unlocking the potential of the network, the next level of the network within this amazing network and infrastructure that we've taken 15 years to create. The fuel burn of the E2 allows us to do two things: increase utilization and increase stage length. And I know that investors are asking a lot, "Why is stage length, why is utilization not back to 2019 levels? Why, when is that gonna happen?" One thing to remember about utilization is that utilization happens when you stretch the day out, happens on early mornings, on nights, on weekends. Monday morning, 8: A.M., every aircraft is flying, right? That's when you have the best demand. But you need really fuel-efficient aircraft to make economic sense, to fly more on weekends, to fly more at night, to fly more early in, in the day, to fly routes that are longer but thinner. And so having the E2, which has more seats, 18 more seats than the E1, but significantly lower cost per trip, allows us to do that. So you will see over time, the stage length and the utilizations, especially, increasing as we stretch the legs, and we explore these previously unexplored parts of the country and routes, simply because this technology didn't exist. And, and fitting that in into our existing network is really gonna allow us to make that happen. Our domestic network, we continue to have a vision of 200 cities served. We're at 155-160 right now, so we're well on our way. Significantly higher than anybody else in the market, anybody else in the region. And again, it's different by design. It's designed to be different, and that allows us to continue to extend and build on our competitive advantage on the network. Internationally, we've also made some significant steps this year. We launched Paris at the end of April. It's doing very, very well. The European summer is very strong. Curaçao as well in the Caribbean is doing well in addition to our U.S. and Lisbon flights. But really great progress on the international side. In terms of our international capacity, we will be 25% larger this year internationally than we were in 2019. We're larger domestically, but we're also larger internationally. So we are more than fully recovered on our domestic and our international network. We have a great set of partners around the world that feed us, and we feed them, from United, from JetBlue, from TAP, from Copa, to Turkish, to Air Europa, and we provide connectivity inside Brazil. Our competitive advantage is that we provide connectivity at different points in Brazil. It's not just in São Paulo. So if you have ambitions to fly in any other city other than São Paulo, then Azul will have the best connectivity for you. Our long-haul network to the U.S. is now eight routes. Like I said, it's larger than what we had in 2019. Great connectivity inside the U.S. as well, 38 destinations in the U.S. and the Caribbean. Very, very convenient destinations, connection times to the Northeast, to Boston, to New York, to Washington, the Caribbean as well, Cancún, those kinds of places. And the amazing thing about this is zero airport-airport competition. Again, our international network is just an extension of the advantages that we built domestically. It's designed to be different, and so zero competition, bringing a lot of loyal customers to our network, great connectivity with our partners from where we are strong in Brazil to where our partners are strong in the U.S., which is Orlando and Fort Lauderdale, and in Lisbon and in Europe, which is Lisbon and now Paris as well. Great connectivity with TAP, Air Europa allows us to get all the capitals in Europe via our flights from São Paulo. So, the network is designed to be strong, to have competitive advantages, and so that's what we have delivered domestically and internationally. This is a beautiful photo of the northeastern Brazil, if you haven't been. We have a vacations business, we can hook you up, but, you know, lots of great demand in Brazil. Right now, what we are seeing in terms of recent trends are very, very strong. We expect to do 30 million passengers this year, by far our largest year ever. But really, the strength is in the domestic demand environment. You know, looking through the U.S. airline 2Q reports and what they're guiding for 3Q, we know that average fares are coming down, right? In Brazil, the opposite is happening. We actually are pushing, as an industry, average fares up because the demand is there to sustain it. And so we are seeing now record average fares, and in addition, we're heading into now our best seasonality, which is our spring and summer, which will take us through the end of 1Q, early 2Q next year. So the industry is set up very well to maintain and to take advantage of this demand environment that we are seeing. So record average fares domestically, strong demand, and you can see that in the on the unit revenue side as well. So record unit revenues for us across the industry as well. As we look ahead, we look at the capacity environment, which is very, very disciplined. We look at the demand environment, which is strong, and the overall pricing discipline. We're very encouraged by the trends that we are seeing. Ancillaries, you know, there was a lot of noise in the U.S. a couple of years ago about basic economy and all that kind of stuff. In Brazil, the market is completely unbundled. We have unbundled the entire product without much noise, and so you pay for seat assignments, you pay for checked baggage, if you wanna move up your flight, all those kinds of things. And so that's allowed us, in addition to other products like Sky Sofa, which only we have, to offer our national flights, to really expand our ancillary revenues per passenger in a very, very meaningful way. Hey, Abhi, just, just back on ancillary revenues. You know, there's now 13% of our business, but top line is significantly higher than it was as well, right? So you, you take a look at how much ancillary is contributing, and that's... as a percentage, you don't really see the benefit, you know, as much as it's contributing to the bottom line. Yeah, that's because the top line revenue has grown, right? Our 2Q revenue was over 60% larger than 2Q 2019. Some recent trends, very, very recent trends. We talked about this on our earnings call. August, our corporate revenue is now 100% recovered what we had in 2019. I'm pretty sure we are the first geography in the world where corporate revenue, in terms of volume... Remember, revenue was always, not always, but has been above 2019 for the last 18 months because of average fares, but volumes are now recovered to a 100%. And so what you're seeing is corporate volumes, 100%. We know average fares are 40%-50% higher, so corporate revenues are 50% higher than what we had in 2019. So now, as Alex like to say, we have the bingo card of complete recovery on the leisure side, which happened two years, I mean, 18 months ago, two years ago, almost. Again, Brazil was one of the first geographies where leisure travel recovered 100%, and now on the corporate side, we're at 100% as well. Again, we're just getting into our best season, so very, very favorable recent trends. And again, I talked about average fares. We've seen a strong movement in average fares, especially as fuel has moved over the last 30 days. The industry has done very well to keep up with those movements in fuel prices. So, strong demand environment, strong fare environment, and good capacity discipline is really setting us up to have a very, very strong, you know, our next couple of quarters. And with that, I turn over to Alex. Thanks, Abhi. So Abhi showed, you know, how we're much better on the revenue side, on the network side, and I also want to talk about how we're better on the fleet side. For those of you that don't know, right, this is a big part of our competitive advantage. And this is, again, why it's so much better to be looking at Azul today than it was back when we IPO'd, because a lot of these were questions at the time of the IPO, right? Now, these are facts. You know, the questions have been answered. One of them, you know, is this a model that can be replicated? And if anything, this model has only become more exclusive than it was before, right? One question at the time was: You know, what if GOL or LATAM start buying aircraft to compete with you? They've actually done the opposite. We have also continued to strengthen the business model. We didn't have Cessnas back then. You know, we hardly had wide bodies back then. So the strength of the demand, the strength of the network, has only allowed us to lean in deeper and make the business model even more resilient, even stronger than it was before, and we're flying the right aircraft at the right market, right? That's what's unique about us, and that's what's so hard to replicate. Because if you want to compete with our with Azul, if you want to try to steal our customers, the only way you can do it is you try to replicate the entire business model. If you try to replicate the entire fleet, you try to replicate the entire network, right? And this is very, very hard to do, and that's why, in practice, it's only moved in the opposite direction, where we've all kind of, you know, intensified the business models that we have chosen, right? And you can see here just the types of cities that we can serve, and a lot of these cities, we, you know, are the cities that we serve alone and that we are, that where we see a lot of growth, right? I think that slide that Abhi showed with all the blue regions, right? You know, average GDP growth for Brazil is expected to be about around 3% this year, which is great. It started around 1% at the beginning of the year, and now everybody's kind of updating their forecast to 3%. But if you do a weighted average of the regions that we serve, you're probably talking about 5%, 6%, 8%, 10%, because these regions have very small bases, and they grow very, very rapidly. Another exciting thing is just the huge head start that we have on flying fuel-efficient aircraft. We will be done with our fleet transformation by 2027. Yet we're essentially 80% there today, and the competition will be maybe 10 years behind, you know, at best, if not more. For them to have a 100% next-gen fleet, it'll take at least an incremental 10 years to us. That means we'll have 10 years where we're going to have a fuel burn advantage, 10 years where we're going to have a unit cost advantage to them, right? You just cannot snap your fingers and just get rid of all your old generation aircraft and replace it with next gen, especially in the environment we have today. Those of you that follow the OEMs know that if you go to Airbus and you ask for an A320neo, you know, after they stop laughing, they'll say, "Yeah, I'll see you in 2029," or something, right? So it's going to be very, very hard for anybody to try to even come close to the head start that we have on them. And the E2, Abhi talked about this, but it bears repeating, right? You know, this is really remarkable. When we say that you're going to have fly more seats for less cost, I think a lot of you just think: Sure, you know, less cost per seat. That makes sense. You're upgauging, right? You're getting into economies of scale. No, we're talking about absolute terms. We're talking about getting 18 extra seats for a negative cost, right? Those 18 incremental seats that we get on the A3-- on the E2 come in at a negative cost per seat. I can sell those seats for zero, and it's still better to fly an E2 than to fly an E1. But obviously, Abhi doesn't sell those seats for zero. He flies it for the opposite of zero, which is, you know, a very, very high fare, right? That means it's all gravy, right? It's all money that's coming in and strengthening the bottom line. Because the 18% fuel burn advantage is not on a per seat basis. It's actually, you fly from point A to point B with a bigger aircraft, and you get to your destination, having burned 18% fewer gallons of jet fuel than if you had flown an E1, right? Which is really, really remarkable. Every airline in the world is going to go through, through fleet transformation, but the change of going from an E1 to an E2 is a transformation that no other airline that we know of is going to go through, right? And it's already happening, because when you look at what we've done since we went public, that's another thing that is much better for you to invest in Azul today than when we IPO'd, because we're already burning 24% less than we're, you know, fewer gallons per ASK than we were burning before. Right? 24% fewer emissions, right? This is, again, back in 2016, this was a promise. ESG. Yeah, this is ESG for now. This is true, right? You know, kind of proven, tested ESG. When we went public, this was a promise. We were just starting on our fleet transformation. We had just started taking delivery of A320neos. Now, this is proven, this is working... And there's more upside. We didn't have a hangar when we went public, right? We have the biggest hangar in Latin America, which is allowing us to create a new business unit. Not only were we able to insource a lot of the work that we did, we used to pay in USD for all of the work that we did in maintenance, now we're paying in reais. We used to have to fly aircraft out of Brazil, now that we can do it in our hub, right? They just taxi from one end of the runway to the other, and then they can start, you know, getting overhauled. So the amount of savings that we got on this already paid for the hangar and then some, right? The hangar costs under BRL 200 million to build, and we already saved BRL 360 million since we started operating this hangar, right? Again, an asset that didn't exist when we went public in 2016. Look at the productivity. Each call center agent at Azul is twice as productive today than they were in 2016, right? Twice. We're serving 104% more ASKs per call center agent than we were. And it's the same story with airports and even across the board, even in overhead, right? We're 40% more efficient today than we were in 2016. There's more upside, right? Because you can say, okay, these are, you know, all these, this data, all this, these figures are already in your 2Q numbers. They are, but there's a ton more upside coming. Because, for example, like Abhi said, you know, on average, we're still gonna fly the fleet about 9.4 hours this year. And we're, you know, we were flying it, you know, 11, 11.5 hours before COVID, and we believe we can get to 11.5 next year. How? We're gonna fly more nights and weekends, essentially, right? Because the fleet transformation, the reduction in fuel prices, the strengthening of the Brazilian real, the gains in productivity that we're getting, they start a lot of the flying that didn't make sense before to start making sense now. So we can make money in nights and weekends, and we can get incremental utilization from these aircraft and bring the fleet back to what it was pre-COVID. This is pretty remarkable. I mean, those of you that follows us since 2016, you kind of understood that our unit cost was higher than the competition, right? Why was that? Because you were looking at a blended unit cost, right, where you have A320neos, we have low unit costs, which have low unit costs, with ATRs, which have high unit costs, right? So when you look at Azul's CASM, you're looking at a blend of high CASM aircraft and low CASM aircraft. It's a mix, right? We don't break it up. When you look at GOL's CASM, when you look at LATAM's CASM, it's purely low CASM aircraft, right? They only have one fleet type. But now, in spite of the fact that we have a blended CASM, in spite of the fact that we have a lower average aircraft size, our CASM is lower than the competition. So if we don't open up the CASM of our A320neos, but if our average blended CASM is lower than the CASM of a Boeing 737 at GOL or an A320neo at LATAM, that means that our A320neo CASM, which does compete with GOL and LATAM, is much, much lower. It's a huge source of competitive advantage that not everybody is aware of. The highest NPS. Yeah, we do. So John's gonna talk about the operation here, but, you know, I think one thing that we don't get a lot of credit for is that we have this huge complexity, and we do it still with a higher on-time performance and NPS than anybody else. Yeah, I just... Hello? Yeah. I just want to go back to this. You know, this is pretty remarkable what has happened since 2016. We now have the lowest CASK in the region and the highest NPS. That's pretty remarkable, right? Nobody else in the world can say that. No other airline in the world can say that they have the lowest CASK and the highest NPS, and that's what we have today. And it's a testament to running a great operation, having great people, and so many of you are aware that we're the most on-time airline in the world in 2022. That's because we have great people. You know, and so when you go back, I just, you know, when you talk about being an on-time airline, that's being 40% more efficient than we were in 2016, and we're still delivering the most on-time airline in the world, okay? Compare that to the U.S. carriers. Compare that to the European carriers, right? Are they significantly more efficient than they were in 2016 and running a great on-time airline? You can see where we are this year. Year to date, we're number two in the world behind Copa Airlines, and you could see that we have significantly more flights per day than they do. But we're very, very proud of the business that we run. You know, I, the strong culture at Azul delivers these great results, right? You don't drive an on-time performance like we have flying ATRs, E-Jets, E2s, 320s, 330s, right, without having the best people in the world. And then when you have a great operation, you know, this is just some of the competition, you know, metrics that we have relative to our competition. So take a look at our complaints per 100,000 passengers compared to our competitors. Take a look at our customer satisfaction compared to our competitors. So we significantly outpace our competition. That's what kind of leads to the highest NPS. And it's really done by our most important, important asset, which is our people. And we kind of had this thing between us up here today that we were not gonna talk a lot about COVID, right? We were not gonna talk about the dark days, but I want to remind everybody that… There was 11,716 people, many of them that are on this page here, took an unpaid leave of absence to save the airline, right? To protect the equity, to protect our debt holders, right? And so those same people are the ones that are delivering today. And, you know, just a few of the great stories. These are our pilots visiting a cancer center, right? Our pilots are actively contributing in the community. This is one of our flight attendants, kind of, you know, having a baby, you know, a crying baby, you know, rocking to sleep on board the aircraft. We have fantastic people. We have an event, a running event on Saturday. I'm trying to get Alex to go with us, but so, you know, here's the running event, and all of our crew members come, and we participate, and we get to hang out together. This management team that you see this picture here of Alex and Jason, we're together often because we like what we do. We've built an unbelievably great culture, and I know, you know, Alex says, "Ah, the financial people don't give a shit about culture." It matters. Trust me, it matters. That's what drives the on-time performance. That's what drives our low CASM, our low CASK inside the airline. It's having an unbelievably great culture with an unbelievably great NPS. And when you have great people that you're proud of, great brands want to partner with you, right? And so this is Walt Disney World. Look at all the aircraft that we have together with Walt Disney World. We're the largest seller of Walt Disney in all of South America, right? And so they've partnered with us, and we started with one aircraft, and now we're up to four, and we're gonna get the Goofy aircraft, you know, hopefully soon. And so unbelievably great brand. So the Walt Disney World Corporation puts their brand on Azul's aircraft, right? And so it's that high quality that we deliver that brings great partners. Another great partner of ours is Amazon, right? Amazon, that many of you know, you know, we are the only airline in Brazil that flies for Amazon today, and we deliver thousands of packages a day for Amazon inside of Brazil today, and so we're proud. These brands say, "Hey, I want to associate my name with Azul." And that's a pretty cool thing that we see, and that drives... You know, that was, you know, Walt Disney World, Amazon, they made those, those decisions in the middle of the pandemic, right? Think about that. They said, "Hey, we believe in Azul. We believe you guys are gonna get through it, and we wanna be associated with you." Before I pass it over to Abhi to go through the business units, I went here with my family. This is northeast of Brazil. We have direct flights to Florida. So those of you like Dan McKenzie, who live in Florida, you can fly directly to Porto de Galinhas, and so, so many amazing opportunities to visit Brazil, so many leisure destinations that Americans need to see. You know, we're not gonna talk a lot about ESG today, but I do wanna say, you know, we have direct flights into the middle of the Amazon today as well from Florida. And so I think the world is looking to save the Amazon, but I think the best thing we could do to save the Amazon is visit the Amazon, right? And so those direct flights in there, get to see it, take your children, take your parents, go fishing in the Amazon, get to visit all the beauty that Brazil has. Abhi? Thanks, John. Yeah, I love that, Disney and the Amazon airplane as well. Talking about our business units, TudoAzul is our loyalty program, our loyalty business, which really is having an outstanding year this year in terms of growth, in terms of attractiveness, in terms of relevance. Remember, loyalty programs are all about the customer. The customer chooses which loyalty program they want to interact with, where they want to send their points, which credit card they want to sign up for. And the more relevant you are, the better you are, the more you're gonna grow. And for us, two big events that happened in terms of our relevance. First was Congonhas, and the fact that we're now in the downtown, São Paulo, we serve all the large corporate markets, as I said, has really allowed customers to try us and enter into our program. And the second was internationally. Having a destination like Paris and in the Caribbean, like Curaçao, has given loyalty customers great options to redeem their points or to earn their points. And what we see, which is quite incredible, is that domestically, we have customers flying us from Congonhas, and then we see them in business class, going to Lisbon or going to Orlando for their holidays. And so that crossover is really very, very powerful, and the loyalty program is the tool, it's the vehicle that allows that to happen. So, we just crossed 16 million members, and we should get to 17 by the end of this year. Great growth in terms of members, in terms of gross billings and redemptions. Congonhas had a huge effect in terms of sign-ups, an 80% increase in terms of sign-ups- Go, go back, Abhi. You didn't say it. It's six times larger than it was in 2016. Six times larger. It's six times larger. Congonhas has had a huge impact on our sign-ups and our... Again, it's all about relevance. Remember, the customer chooses. The customer chooses where they wanna send their their points, and the more relevant you are, the more options you give them. So Congonhas has been a huge impact, and again, bringing customers in into our universe, and loyalty is the way to make that happen. Our credit card really has had an exceptional couple of years, actually. We believe it's the largest airline co-branded card in the country. And some amazing statistics. 70% of all new credit card sign-ups are in the top two levels, which are Infinite or Platinum, high-yield customers. On an accumulated basis, 55% of our credit card base is now Infinite or Platinum status, and these are the-... Customers that spend more, much more resilient in terms of macroeconomic scenario. You can see that average monthly spend for our credit card base, not on Azul, but in their daily lives, is up 80% year-over-year. And it's this high-yield demographics that's now part of our universe with the credit card, that I think is another competitive advantage. It's a level of resiliency, robustness that we have. Interesting stat, if you look at our credit card spend, it's equivalent to 0.5% the GDP of Brazil. So our credit card customers, on a yearly basis, spend 0.5% of the GDP of Brazil. So a very, very relevant, and a very, very, powerful and influential customer base, and the credit card is really bringing them in to our universe. Our loyalty program has a great set of partners, financial partners, retail partners, airline partners as well, and we've diversified the options for our account members. So normally, you know, 95% of redemptions are on the airline. We have diversified that, and now we're down to about 80% of redemptions are on the airline. Other redemptions are for retail, whether it's Apple AirPods or gift cards or our travel partners. And so we have a very unique offering when it comes to using points on other airline partners. Most loyalty companies have agreements, bilateral, one by one. We do as well, United, Copa, TAP, but we also have an additional layer of availability where we actually will go out into the market, and with our corporate discounts and with our specially negotiated fares, we'll buy fares and convert them into points behind the scenes. And that allows our customers to fly intra-Europe, Asia-Pacific, Middle East, with airlines that not necessarily are yet our frequent flyer partners. And so, we give really our customers the best of both worlds and a huge range of opportunities. As we look ahead, obviously, our fuel-efficient fleet is gonna be a big driver of loyalty growth. Strategic partners, whether it's other airlines, other banks, other retail partners, more relevance, our international growth, our domestic growth. And so we're very, very happy with the progress the loyalty program has made and huge opportunity ahead of us. Azul Viagens is our vacations business, which is having an outstanding year. This is something that, honestly, Azul struggled with for the first several years of our life. We were not very good at accessing leisure demand. We had Embraer E1s. We were great in the corporate market. We always overachieved in the corporate market, but because we didn't have A320neos, we didn't have the E2s, we didn't really have a network or the destinations that allowed us to access leisure demand. Now, thanks to the fleet, the 50 Airbuses that we 55 Airbuses that we have, and the E2s that are coming, we're now able to enter and access the leisure market. And as you can see here, this business is 12 times larger. It was much smaller then, now really relevant this year. And again, it's because of our ability to access the leisure market with the fuel-efficient aircraft that we have. We have a network of stores around the country that we will double this year to over 100 stores. Stores that are dedicated Azul, along with a network of travel agencies. But our secret sauce when it comes to our vacations business is the network that we provide. Again, similar to what I said about the Azul network, it's designed to be different, and this is no different. So we have routes, we have markets that only Azul flies, only Azul ever flew, that takes leisure customers to popular leisure, to beach destinations, to mountain destinations, from origins and cities that never before had any service. In fact, this morning, my planning team told me that for the next summer season, our vacations business is responsible for 6% of the entire Azul network. And so it's really growing, the physical presence of the stores, the online presence, the connection with the loyalty program. And mostly, the fuel-efficient fleet allows us to have a route network, a dedicated network, that increases utilization on weekends and allows us to offer a product that nobody offers. So looking ahead, we see E2s. As I said, we have more than 80 potential new markets, many of them leisure, that allow us to continue to access and grow this market. New products and services like the luxury segment, the ecotourism segment, these are all segments that are still not explored, that we're gonna get into, and further growth on the international side. So huge opportunity on the vacation side. And finally, our logistics business, Azul Cargo, had a great run, significantly higher than 2016, eight times. Obviously, a huge run in the pandemic.... Growth has leveled off compared to last year's, mostly on the international side. You're seeing this in FedEx, on UPS, Amazon as well. But, we are still the largest domestic air logistics provider in Brazil. As John said, we're Amazon's only air logistics provider in Brazil. We have a network of 300 franchises of stores around the country that allow us to access 5,000 ZIP codes, many of them within 48 hours. Our average shipping time is 2.4 days. That's anywhere in Brazil to anywhere in Brazil, from any remote origin to any remote destination. And so, we continue to see huge opportunity on the e-commerce side, and other segments as well. So, the flexible fleet is a huge part of this. 80% of what we carry in logistics is in the belly of the aircraft. That's where the margins are significantly higher. Variable costs, variable margins, the aircraft is going anyway. But we also have a fleet of dedicated aircraft, seven 737s, E1s, and the Cessna Caravans, that allow us to extend our reach. And finally, logistics in Brazil, its e-commerce is still, it has low penetration in the market. You still have long delivery times. That's not in São Paulo, that's not in Rio, so we see huge growth ahead, a great opportunity, and we see growth rebounding towards the end of this year and next year. Our sub-regional, our baby, baby airline, Azul Conecta, our Caravan operation, very, very efficient in terms of low cost. Very, very low trip cost. Allows us to access 79 destinations. None of them had air service, and none of them without us would have air service. So we're bringing new customers into our network, new demand, unexplored demand, and we're doing it in a way that's very efficient on a trip cost basis, and as John said, lots of benefits in terms of fuel pricing, fuel tax initiatives. It really is a win-win. We grow service to the country, and we have some fuel incentives as well. So, we're very excited about how this is going. 27 Caravans, and really exploring Brazil overall. And finally, our TecOps, our MRO operation, we launched it this year. As you know, over the world, very, very limited MRO capability. Our people have done an amazing job supporting us over the last 15 years, being the most on-time airline, a complex fleet, a different fleet. So we have a huge range of expertise, of technical abilities that we're excited to share with the outside world. So we see this as a huge opportunity going forward. Alex? Thanks. So hopefully it's clear, you know, that this is a much better business than it's ever been, but let's talk about some numbers. Now, we're still one of the most profitable airlines in the Americas, right? So, you know, all of that boils down to very high profitability, as it should, right? If we have this network exclusivity, if demand is this strong, if we're that efficient, if our CASM is going down, right, you know, it should translate into higher profitability, and it absolutely does. And this is consistent. If you go back to, you know, all the way to the IPO, right, we've had EBITDA margins in the high 20s%, low 30s%, and always among the best in the Americas. Obviously, a big dip here in the pandemic, but look at what happened to EBITDA. Since we created the airline, right, it's been a very consistent EBITDA expansion story, and we're kind of snapping back to the original story, right? If you kind of, you know, extrapolate from where we were in 2019 and where we are today, we're kind of back on track, which is very exciting, right? That means the business is solid. And, you know, back in 2016, a lot of these were questions. You know, again, these are now facts, right? The questions have been answered. And another question I think that has been answered is the resilience of the business and the company and the management team, right? We've always said that, "Look, if there's a crisis, Azul is gonna do better than our competitors." Now we have empirical evidence, right? In 2016, 2017, 2018, 2019, these were theories. Now, these are facts. How did we handle this? Well, you know, we've been through the biggest test that I think any airline could have been, you know, with essentially two years of revenue going away, right? The total impact of the pandemic was about BRL 20 billion, and our annual revenue in 2019 was BRL 11 billion. So this is almost... You know, it's a year and a half to two years without revenue, no government funding, you know, compared to the U.S. or Europe. If we had gotten the financial aid that the U.S. carriers got, this would be equivalent to about $2 billion, right? BRL 10 billion. Imagine if Azul had BRL 10 billion more cash than what it has today, right? That's the equivalent support, you know, pro rata, that the U.S. carriers got, and we didn't get anything. But how did we deal with it, right? Again, this is a question that has been answered. How is this management, management team going to act on behalf of the stakeholders in case of a crisis? And I think we've demonstrated that. We went through, you know, hell and high water to protect the equity. We did everything we could, and we were, if we were successful in protecting the debt, right? A Chapter 11 would have wiped out the equity. This is the path that other airlines that did not get government support chose to follow, and we didn't. Other airlines that didn't have government support and didn't file for Chapter 11 applied a haircut to their bondholders. We honored all of our debt, and we're paying back $1.00 cents on the dollar. We were very proud, and we were very honored to get the support from our stakeholders throughout this process. I think, again, if you're talking about ESG, if you're talking about governance, this is a true, you know, business case, a true, you know, real-world story of how this management team dealt with the biggest crisis that we could have gone. And we're very happy with where we are, right? We've been through a tough six months, where the market was nervous. They didn't know. They weren't sure if we were gonna get the support from our stakeholders. But, you know, the outcome is a huge reduction in lease liability, right? We're very, very excited about this. A huge reduction in annual lease payments. Our annual lease payment now starts with a two, right? We're very excited about this because what this means is that, you know, and the way we did it was, again, honoring 100% of our commitments, and in a way that not only protected the equity, completely eliminated any stock overhang that you could be worried about. Right, think about these numbers. At the worst point, right? First, we're going to distribute. You know, those of you that know, we swapped, you know, all of our, a lot of our pandemic debt and also reduced our lease payments in exchange for a 2030 unsecured note and an equity instrument. This equity instrument is gonna trickle in over 14 quarters. From a year from now, it's gonna start a year from now, and it's gonna end at the end of 2027. And at the worst point in time, it's going to be 6 million preferred shares. For a stock, you know, 6 million preferred shares in a quarter that are going to be given to lessors, for a stock that trades 23 million shares a day, right? 6 million shares a quarter for something that trades 23 million shares a day. It's nothing. It's a drop in the bucket. It's spread over 14 quarters. Very, very, stakeholder-friendly, exactly to minimize dilution and eliminate the overhang. And no debt repayments until the end of 2028, right? We don't have to worry about that. Right, we are, you know, obviously, the cost of capital is high, right? So there is a high coupon payment, but we have a lot of options to pay, to buy back this debt. Essentially, every year in 2026, 2027, and 2028, we have a par call on one of our debt. Right? So we'll be able, as interest rates come down, as the cost of capital comes down, we will be able to refinance sooner than these maturities, but until the end of 2028, we have no maturities to worry about, right? So we've completely de-risked the debt profile of the, of the company. And what that does is, you know, the market was worried about the gray bars here. Oh, Azul's gonna have a $3 billion cash burn in 2023. We transformed that into breakeven. And next year, which was gonna be breakeven, we're actually going to generate cash, right? So this is something we're very excited about, and we're deleveraging, right? Not only we're, you know, protecting the cash balance, but in the process, we are paying down debt. And so we will have... You know, when we went public, again, in 2016, our leverage was 5.7x, right? And, you know, nobody worried about that. Everybody was excited. They knew we were a growing airline, and it was natural to have high leverage, and that leverage would come down. It did come down. We brought it down to 3.3 by the end of 2019. Obviously, with the pandemic, it went back up. But by the end of this year, we'll be essentially at the same leverage as we were in 2019, and by the end of next year, we will be below that. Right? So there's not an issue with leverage either, right? You know, all of you that learned or that looked at the equity instrument, right, that we're converting our leases into, it converts at 36 BRL a share. The shares are trading below 15 BRL a share. And how did we get the lessors to agree to a 36 BRL share price? First, there's a floor and a cap, right, that we've talked about, but, you know, essentially, we're trying to make them whole, but trying to protect the dilution. So if the stock appreciates beyond these numbers, there won't be any additional dilution. In fact, the dilution is gonna come down. But that's the way we do the math of the restructured balance sheet, you get to BRL 36, not with an 8x multiple, which is what we've had, you know, every year since before the pandemic, but just with essentially a 6-6.5x multiple, depending if you treat the convertible equity, the convertible instrument as equity, or you treat the convertible instrument as debt. And this is something that I think is worth kind of checking the numbers on a little bit, because a little bit through our fault, right? When you look at our balance sheet, on our total debt, you will see the convertible instruments there, right? We have a convertible debenture that shows up as debt on our balance sheet. But when you look at our fully diluted share count, the number of shares is also there, right? So if you just purely just take the debt number from our balance sheet and the fully diluted shares from our earnings release, you will double count. Right? So we wanted to kind of give you these numbers so that you can check your math to make sure. Look, you can discuss, we can discuss on whether you should treat the convertible instruments as debt, or you should treat the convertible instruments as equity, but you have to pick, right? You can't treat them as both. They will be one or the other, right? And so if you want to treat it as equity, is the calculation on the left. Our net debt at the end of Q2, which is roughly what the net debt is going to be at the end of this year, is about BRL 17.7 billion. You know, with the expected EBITDA that we guided to, of BRL 5.5, you should use 495 million shares, which is the high number of shares, right? This is the number of shares after the convertible instruments have been issued, and you get to a price of BRL 36 a share with a multiple of about 6.5. Hey, Alex, if I could just highlight, that's based on 2023 EBITDA, right? And Alex walked through the vesting schedule and when it actually vests. Why don't you go back to that, Alex? I think, I think that's kind of important. Yeah, look at the average life of that conversion, right? Yeah. It's essentially second quarter of 2026. That's the valuation moment in time that you're looking at for the conversion of the equity instrument, is second half of 2026, second quarter of 2026. So arguably, at the time, you're gonna be looking at 2026 EBITDA, right? We're doing this math with 2023 EBITDA, right? So just look at how much sort of, you know, wiggle room we have here, right? You know, chances are, in 2027, you're gonna be saying we did a bad deal, that 36 was too low a share price, right? That's probably what's going to happen. Right, but I think, you know, this is kind of a good way to kind of check the math and make sure that we're all kind of talking the same thing, and we're not accidentally misleading you by having you double count the convertible. So just to recall, there are gonna be two convertible instruments, right? There's a convertible debenture that shows up on our balance sheet. That's something we issued in 2020. It's still there. The lessor equity structure, accounting requires us to treat it as debt until it gets converted, so it's gonna show up as debt, right? You can treat it as debt, debt, you can treat it as equity, but, you can't treat it as both. And I would just encourage everybody, you know, I'm gonna say this at the end, to update your model. Sit down with us, talk to our IR team, and kind of walk through these numbers. Make sure you have them, because, you know, nine times out of ten, we found double counting. You know, when, when, when... I don't wanna point out which sell- side analysts did it right and which did it wrong, but nine times- Obviously, everybody in this room did it right, right? We know that. And look, you know, our multiple hovers between, you know, kind of high sevens', low nines' since we went public, right? Now we're at, you know, mid-fours'. At some point, you know, we're not gonna, like John said, we're not gonna snap back to eight right away, right? Cost of capital is up, risk aversion is up, our debt structure is different from what it was. That's all fine, but we're not gonna stay at 4.5. And so gradually, even with the margin expansion, naturally, we're very confident that we're gonna get to something north of 4.5. It doesn't make sense. And then, at some point, we're gonna get to six and eight. That's the long-term upside. Look, we love long-term investors. We know this is a volatile industry. We're an airline in Brazil, right? We are, every day, almost, we're either the stock that appreciated the most on the Bovespa or the least, right? So it's volatile, so you have to be a long-term investors. But for those of you that are long-term investors, the upside here is just huge, and that's what we're excited about, because there's the margin expansion, and there is the multiple expansion, right? There are kind of two drivers of valuation. Look, and look, we used to be BRL 3.6 billion in EBITDA in 2019. In 2016, we were BRL 1.8 billion EBITDA. Okay? One point six. BRL 1.6 billion in EBITDA, right? We're BRL 5.5 billion in EBITDA now. A much more valuable company. And we're not even back to our pre-COVID enterprise value. So, you know, forget about the debt, forget about... You know, we're not even back to our enterprise value. And why? John showed you this, but I think it's worth highlighting. We've always traded at a premium to the industry, right? And this also eliminates the multiple argument. Again, cost of capital went up, so multiples went down. Fine. Why are we trading at a discount to the industry when the business is so much stronger than it has ever been? If the business was coming out of the pandemic, you know, with a problem, with you know, with some kind of legacy issue, right? Maybe we got smaller, maybe we have some huge legacy costs, right? Maybe we have a new investor, right? No, there's none of that. The business on, in every dimension is better than it used to be, and we're now trading at a discount to the industry when we used to trade at a premium, right? So this is just an invitation for you to take a look, right, and update your models, talk to us, you know, you know, get updated, get, up to speed again on Azul, because we think it's obviously, a great opportunity, right? And again, with a lot of the, maybe, you know, a lot of the investment thesis in 2016 were thesis at the time, right? Were beliefs at the time. Now they are facts, right? The thesis that LATAM and GOL are not going to encroach our territ- on our territory, that was a thesis, that was a belief in 2016. Now it's a fact, right? The idea that we could, you know, do a 6x on TudoAzul, the idea that we could do a 12x on vacations, you know, that was not even a thesis at the time... Right? And now it's a fact, right? The fleet transformation, all of these are assets that when you buy Azul now, you get, and you didn't get it in 2016 when you bought it before. And in 2016, we IPOed at BRL 21, or $20, and now we're trading at $9 a share, right? That's why we said it's 3x EBITDA for half the price. Thanks, Alex. You know, just before we open it up to Q&A, you know, obviously very thankful for the team and everything that they've done to pull this all together. Think about this for a second. The last three years, our efforts were saving the airline for our stakeholders, right? For our debt holders, our equity holders, for our crew members. That's where we were focused, right? Especially Alex and myself, the last six months, this was 24/7 to do, right? Now we get to go run this great business. Now we go get to You know, so a lot of people say, "Well, you're at 55 today, what's it gonna be next year?" It's gonna grow. It's obviously gonna grow. Why wouldn't it grow? Now that we have our CFO, who used to run Azul, dedicated back to the business day-to-day, he's no longer focused on day-to-day cash management, renegotiating with lessors. Well, in a month, right? In a month. For the next month, you know, I'll be on the road, but- Yeah. -after that- And quite honestly, we have not been in front of our equity investors as much as we should be, right? Because we hadn't finished fixing the balance sheet, and now that that's done, we'll have the opportunity to be on the road a lot more often. We'll be in front of investors, and that's why I said, dust your model off. Many of you that bought the company back in 2016 or 2017 made a lot of money on the IPO. The unbelievable difference today than we had when we went public is the volume on the stock is significantly higher than it was in 2017. I would argue it's 10 times higher, right? And so, no, this is not a re-IPO that we're doing a primary or a secondary offering, right? So you're gonna have to buy the stock in the market. But the volume on the stock today is 10x what it was back in 2017, 2018, 2019. So you can accumulate a position relatively quickly because we trade so much on a daily basis. But with that, we wanna turn it over to questions. Thais will also be getting inbound questions from those of you that are online, and so, you know, we're here at your disposal for any questions that you may have. Perfect. Thank you very much. This is Pablo Monsivais from Barclays. I have two quick questions. The first one is, considering the increase in jet fuel that we have seen over the last few days, how confident are you in your ability to translate this into higher fares, thinking that we're already in a very high level? And how do you think also the competition will behave? That's the first one. And the second one is more structural, and, I was wondering, why do you think that such under-penetration in trips per capita in Brazil still exists, since you have been offering new services into these remote places? Is there any structural reason why Brazilians are traveling less, or perhaps you will never be as comparable as Colombia or as Mexico or as Chile? Why do you think there is, like, these burdens in, to see a higher penetration? Thank you. Yeah, so I think the industry is gonna do everything it can, and I think, you know, this graph already shows that, that it is. If you look at capacity in the market, the capacity is coming out. Overall, the market's gonna grow 5% versus 2019, you know, which is, which is very small over four years. The industry is taking fares. Demand, of course, is supporting that. So I think the industry is very disciplined. Now, it takes time, right? Because you have a booking curve, and, you know, great bookings will lead to great flown revenue, but you have a booking curve, and you have to work through the booking curve. So you do have the effect of time, but, I'm very confident the industry... You know, the industry, we're all facing the same challenges, right? Whether it's fuel, interest rates, and I think everybody is very, very results-oriented. If you look at LATAM post-restructuring, you know, the, the, the investors that came in, and what they're after is results, right? When you look at GOL now with Abra Group, us, you know, we've, we've always been rational. So I think the industry is very disciplined. And the market, you know, the fares that we are today, I didn't think we'd be there six months ago, right? Nor did any sell-side analyst, to be clear. And so we are there now, and the market is absorbing, and the market is taking it. So, you know, there is no artificial limit. I think the industry is gonna do what it takes, and it takes a little bit of time. And in terms of penetration, I think it was just a matter of not having service, right? Like I said, São Paulo to Rio never needed more service. Yeah, and to just go, it's 0.5 today, but when we started Azul, it was 0.3, right? So we did transform it from 0.3 to 0.5. So it is possible to take it to 0.8, right? I'd love to take it to 2.6, which is the U.S., but probably not in our lifetime. But by just going from 0.3 to... From 0.5 to 0.8, you're gonna need three Azuls, right? Instead of the one we have today. Hey, hey, if I can just kinda highlight something. Jet fuel in Brazil is the most expensive in the world, okay? And that's - it's significantly more expensive than it is in Colombia and Mexico, and that's something the government is looking at, right? And so it's not in our forecast, but it's something that the government is certainly looking at. But if you go back and look at, you know, what Azul has done and the network that Abby built, he's connected 100 cities in Brazil that have never been connected before. 100 cities. So that's what took it from 0.3-0.5. Abby is not known for having low fares, okay? So we grew the Brazilian market through connectivity and not through fares, okay? That, that's a big distinction. But as you go forward and you look at the E2s coming into the network, they have a 26% lower seat cost. So we actually have the ability to grow the market over the next five years with lower seat cost aircraft. So he could technically lower the fare, right, and bring more travelers into the pool, right? So again, we connected Brazil and grew the market, but you also could stimulate it if the government goes after fuel prices in Brazil and you have a lower seat cost aircraft that we have coming on very strong over the next couple of years. Do you think that the second part, getting to the 0.8 to lower fares? It's gonna be one of the drivers, right? So I think that, you know, it's, so the question is, is that what's gonna take it, right? It's a lot. We're working at every possible driver, right? We're very aligned in trying to stimulate more demand. But it's a combination of lower costs, for sure, a lower tax base, which the government has already showed that they are aligned, right? Because they eliminated the revenue tax on the aviation industry until the end of 2026, right? So I think there's interest from the government, there's interest from us. I think there's economics that are going to help. You know, there are the 200 cities, we're at 160 today, we're gonna go to 200. Those incremental 40 are also going to help. So everything's gonna help. Some of these are in our... You know, we're only talking about 2023 EBITDA, right? None of that is in the 2023 EBITDA. I'll start. Good afternoon, everybody, and thanks for the time. It's Steve Trent from Citi. One or two for me. First, I was curious if you could maybe highlight if there have been some structural adjustments in demand in Brazil since the occurrence of the pandemic, whether that's a little less corporate and local shuttle, and, you know, how many of you adapted to that? And the second, if you could sort of, on a high level, address your pipeline for pilots and mechanics. Thank you. Thanks, Steve. In terms of demand, you know, like I said, corporate volumes have come back to 100%. This is the first month that it happened. We are seeing a little bit of a change. Now, Brazil was one of the first to come back to, to the office. It is more of a presential market and culturally, in the way we do business, the geography as well. So we're seeing a little bit, for example, where the party size per trip has increased a little bit, so more people are going on the trip together. We're seeing a little bit of an increase in the length of stay, so people are staying an extra day, especially over weekends, if they take somebody. But, you know, Fridays continues to be the strongest day, Monday continues to be the second strongest day, Sunday is the third strongest day. So the day of week patterns are pretty intact. What's really been amazing is how quickly leisure came back, and we thought everybody thought it was pent-up demand, but it wasn't. It came back and it stayed, right? And now corporate has just come back to 100% volumes, and we expect it to stay as well. So some structural changes, but overall, Brazil has benefited from geography and from the culture in the market of coming back in person much quicker than anywhere else. You know, Steve, Brazil's got its own problems, and pilot pipeline is not one of them, right? So that's a, that's a problem for the subsidized U.S. carriers that got bailed out by the government, okay? So we have Azul Conecta, which is our subsidiary that's growing pilots for us. We have a huge pipeline in the country, and, you know, pilots wanna work for an airline that's growing, right? And, you know, this year we're gonna promote over 100 of our pilots to be captains, and we have the lowest upgrade time in Brazil. And so I think, you know, we continue to grow, and, you know, that's just not one of our concerns. Mechanics is a little bit more of a concern in Brazil, right? And so we've partnered with several schools to produce more mechanics. Believe it or not, you can produce a pilot a lot faster in Brazil than you can produce a mechanic. And so, you know, that is a bit of an issue, but we've partnered with several schools in Campinas and Minas Gerais, and so I think we have a pretty good pipeline, and our HR team is working very closely with them. Thank you. Dan? Hey, good afternoon. Thanks, guys. Dan McKenzie from Seaport Global. A question on the balance sheet. I think you guys hit the nail on the head with respect to the concern about the valuation multiple. So for those investors, you know, that wanna take a two to three year investment horizon, wanna look at that, they have to square the corners on that balance sheet. So I wonder if you just kinda help us lay out the balance sheet roadmap for the next, say, you know, three years from now. You know, what does the business look like? What does the balance gross debt look like? What does leverage look like? It looks like you've got a path to three times. You know, if you convert that debt, you get down to 2%. You know, what does interest expense look like? If you can just kinda help us understand what that picture looks like three years from now? Yeah. The balance sheet is not that complicated. Most of our debt is aircraft leases, right? And I think that's where most of the work should be. Obviously, whichever methodology you use to account for operational leases. We're a much better airline today than we were, you know, during COVID, right? Because we've had a huge reduction in the lease payments, right? Which became other items on the balance sheet, which are easier for you to look at, right, especially the 2030 note. But one question is, what is the lease liability? You know, you'll see what the numbers are. Go to that spreadsheet, John, with the BRL 17.7 billion. So we're already kind of telling you what the pro forma number for the debt in Q2, there you go. In Q2 was, and it's very similar to what it will be at the end of Q4. And that takes care of the operating leases, takes care of the capital markets debt that we've issued. It takes care of the 2030 note. Everything's in there, right? We can kind of tell you, kind of, you know, help you kind of see the components of that if you're not getting to the $17.7. But, you know, the materials that we've provided on a pro forma basis since we've finalized and throughout the whole negotiation with lessors, should help you get there. So that's it. You know, the balance sheet is operating leases. It's, you know, the 2028 note that we just issued, the 2029 and 2030 notes that are the exchange notes, right? They were 2024s and 2026s, became 2029s and 2030s, and then the 2030 lessor note, which is an unsecured 7.5% coupon note. That's essentially all of our debt, right? You know, the capital markets debt, the 2030 lessor note, those are all kind of very easy to calculate. It's essentially the principal. Those numbers are all out there. And then on the lease liability, it's really the question. So, you know, talking about the lease liability, obviously, our balance sheet follows IFRS 16. I don't know if there are any IFRS 16 fans here. I'm certainly not one of them. I think it was a, you know, a problem that didn't exist, and they created a solution that ended up creating 18 other problems, right? But 7x is wrong, right? And we can go into why 7x is wrong, but, you know, it's very clear that 7x is wrong. One of the reasons why taking our rent and multiplying by seven is wrong is most of the criticism that we get on IFRS 16 is that our discount rate is too high, right? IFRS 16 requires us to use the incremental cost of borrow at the time that you're calculating the present value of the lease liabilities. So we had no choice then to use essentially 20%, right, which is what we're using. But if you use something like 10%, which I don't think anybody would say is an excessively high discount rate, right? Because our secured debt is trading around 12%. But if you discounted our lease liabilities using a 10% discount rate, you get to a 5x on rent, right? So if you take our annual rent and you multiply it by five, that's equivalent to calculating the present value of our lease liabilities with a 10% discount rate. So probably the right multiplier for Azul is something like 4.5, right? Why isn't it seven, if it's seven for the northern, you know, hemisphere carriers? Because, you know, if I borrow, if I do a capital lease on an aircraft and a triple-A airline does the same thing, we're gonna have the same debt, right? Let's say we both do a finance lease on an A320neo, and it's, I don't know, $50 million. We're both gonna have a principal of $50 million. Azul and the AAA airline are both gonna have $50 million on their balance sheet. But my rent is higher than the AAA airline, right? I'm not gonna pay the same rent as a AAA airline, so you can't apply the same multiple to my rent to get to the same number, right? So there are many reasons why 7x is the wrong number to use for Azul. All right? We have the balance sheet, you know, you can use 5x, and that's one of the conversations that we wanna have over the next month, you know, and that's why we ask you to kind of update your model. Call us, let's, you know, discuss it and figure it out. But certainly, you know, 7x is not the right number, but everything else, I think, is pretty straightforward. If I may just ask a second question, one more. Abhi, on the 80 new routes, what kind of growth? If you can just help us understand, you know, how you're thinking about growth over the next three years. You know, what's a sustainable growth rate? You know, how long would it take you to get to these 80 markets? Yeah, Dan, I mean, I think, you know, domestically, around 8%-10%. There's a lot of slop in that number because of deliveries, right? So we have 17 E2s now. We should be at 20 by the end of the year. By the end of next year, it could be 28 or 34. We don't know, right? And so that kind of makes it a little bit, little bit difficult, but, I would say that something similar on 8%-10% domestically is kind of what, what we're looking at. Mainly coming from the upgauging, right? I mean, because every E2 has 18 more seats and will fly a higher utilization per day than the E1s, right? And so it's the right thing to do, and that's a big driver for margin expansion into 2024, into 2025, into 2026, because that's what the E2s is the next phase of margin expansion going forward. Okay, thanks. Hey, good afternoon. Mike Linenberg, Deutsche Bank. Great to see you guys. Congrats on the restructuring. Just a couple questions here. I want to go to your utilization. I think it was on one of the charts, 9.4 hours this year, and I think the goal is, what, 11.4. Is that next year? And so question is, that's a pretty sizable jump. I'd like to know, you know, what are the sort of the key gating issues? It seems like pilots are not an issue. John, you mentioned mechanics, but again, that's pretty sizable. And again, you know, that's sort of within the context of maintaining a balance on, on, on your revenue performance, right? You push too much into the system, you undermine your ability to generate high-quality revenue. Can you talk about the puts and takes? Yeah. Because that, that's a big number, and it seemed like that type of utilization improvement would be what you would see over maybe a three, four, five-year period. Why one year? Yeah. The next follow-up. A couple of things also. The base this year is also deflated, right? One of the reasons was, as we were coming off the huge run in fuel end of last year, early this year, we had to artificially bring down utilization, right? And so one thing is, I can't say fuel is low, because it's not, but it's lower than what we had around this time of last year, and so that allows us to have a little bit more opportunity. So one was, this year is artificially deflated. We had to bring it down because of the way fuel was behaving. E2s, for sure, right? So when a gating issue, absolutely, is the delivery of the E2s and how quickly we can get them and how Embraer is able to produce them. Obviously, we're working very closely with them, so, you know, we'll see how that goes. There'll be some slop in that number, but having the E2s earlier, more of them, is gonna allow us to bring that up. You know, third, a little bit, Mike, is philosophy of the network. So I'll give you an example. At our main hub in Campinas, we have about four big banks, connecting banks. Starting in November now, we're gonna de-peak our hub in Campinas and spread it out throughout the day. So, that allows us to do a lot more back and forth. Right now, the aircraft waits for other aircraft, and that increases ground times. And so we had something like 35%-40% of our aircraft had ground times larger than the operationally minimum connect ground time, right? Because they were not, not because they were just doing nothing, but they were waiting for other aircraft to arrive in the bank, and because the bank was so big, you have to wait longer. And so the, the first aircraft that arrives is waiting more time. So we've de-peaked a lot of our Campinas hub. We've brought all the ground times much closer to the minimum ground time, and so that allows us to do a lot more back and forth. The aircraft is on the ground time less. So a different philosophy, a little bit on, on the network side as well, to kinda enable the higher utilization. We're confident that that's gonna produce good revenue as well. So I would say this year is artificially high, artificially low. E2 is next year, and we are taking a little bit of a different philosophy and kind of network structure, especially in our big banks, de-peaking them a little bit, having more back and forth, aircraft waits on the ground less, that allows us to be, to be in the air more. So that's, you know, kind of three things to help us get there. Yeah, if I could just add two things to it. You know, there's a constant tension between Abhi and Alex, and do we need to be the most on-time airline in the world, right? I think, you know, it's a good thing that most of my crew members only speak Portuguese, because you know, as we kind of push the operation a little bit, maybe we sacrifice a little bit of on-time, but we get the utilization up. But the other thing that Abhi kind of highlighted is the packaging business, the vacations business, is really that off-peak utilization flying that we really need to do. And a lot of those cities don't make sense with E1s, but do make sense with E2s, right? And so that's a big difference, right? Flying the E2 on Saturdays and Sundays, and they're longer stage length routes to the northeast of Brazil, I think that also takes it. So it's kinda, let's push the operation now to see what we're capable of doing, kind of reducing, you know, our ground time a bit, and then let's make sure that we ramp up utilization on the weekends with our vacations business. Okay, great. Then just the second question, sort of competitive questions: Can you just remind us with Congonhas, is there not another phase where there's maybe additional slots? And then just touch on competition, because if we go back to 2019, 2020, even in the midst of COVID, you know, JetSmart was gonna take over the world. I think they were seeking a, a local license to operate domestically within Brazil. We had the Viva group expanding, Ultra Air. I mean, there were a lot of low-fare carriers. They were gonna eat your lunch. What's happened? Maybe it's, you know, they couldn't keep up with inflation. Just run us through the competitive dynamic. Thanks. So, Congonhas, I would say the vast majority of the slots have been distributed. There could be another couple of rounds, but it's gonna be very minimal in terms of the actual slot expansion. The big jump in airport operations has pretty much happened. So, and that, together with the ex-Avianca Brazil slots, that was the big bulk of slots that got redistributed. So, next two seasons, we could have a little bit of slot, but it's gonna be a couple operations an hour at most. Okay. In terms of competition, I can start, John can add, but, you know, we haven't seen in Brazil, you know, any movement, of course. You do have low-cost guys, JetSmart, flying to Chile, flying to Argentina, Flybondi as well. You know, but I personally don't see anything domestically changing in the short to medium term. It's interesting. I remember talking to the guy from Norwegian, and he said, "I will never fly to Brazil ever again." Right? It's Brazil is a tough place to do business. You know, we've highlighted on several occasions. We have 3% of the world's flights, 90% of the world's lawsuits, right? And so you take an airline that's an ultra-low-cost carrier that says they're gonna come into Brazil, and they're gonna get sued, right? And the litigious nature of Brazil today, without a cap on customer lawsuits, and so a lot of. We run the best airline in the world, fewest complaints, and we still get sued, you know, significantly in Brazil. And so that's a barrier to entry today, Mike. You know, they opened up Brazil back in 2018 for foreign ownership, and no one has come. But, you know, I think, you know, what's important to us, we have to have the lowest CASM in the country, right? And we do today. We have to have the most fuel-efficient fleet in the country, which we do today, and we have to have the most defensible network, right? And so that's kinda how we do it. It's, you know, to sit here and say they're never gonna come, yeah, I think that'd be a foolish statement to make. But there are significant barriers to entry as to why they're not in Brazil today, right? And I think you have. You know, when you talk about competition, everybody wants to talk about the ULCCs. I think you have a really good dynamic between GOL, Azul, and LATAM today, right? All three airlines wanna make money. All three airlines have a higher cost of capital today. Two of the three airlines, right, are trying to go public in the next 12 months, if you think about that, right? And I'm doing my re-IPO today, okay? So everybody wants to focus on on making money, and I think you're seeing that in terms of how we've gotten fares up to where they need to be, given the new fuel prices. And so I think everybody kinda needs to get back to margin expansion and multiple expansion. And so I think the ULCCs, for now, I think, are just a sideshow. Yeah, I remember we were driving in from Connecticut to New York in 2008 for our first board meeting when we weren't, you know, we didn't even have a name or an aircraft. And, you know, Branson said he was starting an airline in Brazil, a domestic airline. This was 2008, right? It's 2023. Obviously, that never happened. I joke because why didn't it happen? I think it's because their financial planning and analysis team actually kind of scrubbed their financial model and said: What is really the competitive advantage that a ULCC can bring to the country? As I think Abhi said, we've already unbundled in Brazil, right? The ULCCs kind of had an, an, a freeway, right, to kinda grow in other markets because they had legacy carriers that didn't want to unbundle, right? You could say: Look, I'm gonna offer you a very low fare that doesn't have bags, doesn't have seat assignments, you know, doesn't have mileage, whatever, while the legacy carriers didn't want to unbundle. So there was a possibility that somebody was selling, you know, a fare, a full fare for $300, and somebody else was offering something for $49, right? That doesn't exist in Brazil because the unbundling has already happened. And when you go line item by line item, right, our biggest cost is fuel. A ULCC would pay more per liter, per gallon of jet fuel than we pay. Because we have special regimes, because we fly to 200, you know, destinations, we pay less fuel tax than somebody that just wants to fly a high-density A320neo from São Paulo to Brazil, right? They would pay full tax on fuel, and we don't, right? That's fuel. Labor, everybody's gonna have the same. You have to hire in Brazil. You're gonna have limitations on productivity. You know, an American pilot can fly, I think, 1,000 flight hours a year. A Brazilian can only fly 850, right? That's for us, that's for JetSmart, that's for whoever comes in, right? And you go down every other line item, right? Are you gonna spend less on maintenance? No, because most of their maintenance is probably gonna be done outside of Brazil. Are they gonna pay less on ground handling? No, 'cause it's a volume game, right? And you have to hire locally. Are they gonna pay less on airport fees? No, you don't have the dynamic in Brazil of a remote airport having lower costs to operate than the downtown airport. That doesn't exist in Brazil. I think the only thing they could do is densify their aircraft, right? I think we all, one way or another, have some kind of economy premium type of, you know, product in our fleet, but we do it because it makes money, right? The real estate that we give up is more than offset by the incremental revenue that we make. So we don't see. Obviously, we're not saying that, you know, we ignore the risk, right? We're paranoid about it, but we don't see where the competitive advantage of the ULCC would happen in Brazil specifically because of all these reasons. Hi, can you talk about your decision of buy versus lease aircraft going forward? Sure. So we started the airline essentially leasing, right? Because when... You know, the big advantage of an operating lease versus a finance lease is you get to finance 100% of the aircraft purchase price. So there's no. It's essentially, you know, like when you're buying a house, where normally the big sort of barrier for you to buy a house is the equity down payment, right? So when you start off as a young airline, you normally favor operating leases, and as you mature and you start generating cash, you move the needle a little bit more towards the finance, lease. Pre-COVID, we were one-third finance leases and two-thirds operating leases because we were already generating cash, you know, so we were trying to, you know, kind of hit that sweet spot, that mix of finance leases versus operating leases. That provides a lot of operational flexibility, because if you have to reduce capacity, having a portion of your fleet that is under finance leases is something that's very helpful, right? It's something that's very valuable because it's very easy for you to sell an aircraft, pay down the debt, and get rid of the capacity. It's very hard for you to get rid of an operating lease, right? So having a mix of operating leases and finance leases gives you some of that flexibility. During the 2015 recession in Brazil and then during COVID, we sold a lot of our finance leased aircraft, and so today we're at maybe 85% operating lease and 15% finance lease. You know, one of the things that we wanna do as we start generating cash again, as the cost of capital comes down, is to favor a little bit more of finance leases. But that's a decision we can make on an almost delivery-by-delivery basis, right? We can see an aircraft that's coming, and then we can decide, okay, what's the best source of financing? We can look at the cost of capital of the operating lease, we can look at the cost of capital of the finance lease, see the difference, and see if the optionality is worth it. Over time, I think we'll gradually grow that mix back to two-thirds, one-third, but that's gonna take a few years to get there. Gabriel Rezende from Itaú has one question. Looking in the long term, what do you think about the structural things that could happen in favor of the airline sector in Brazil? For example, higher exposure to foreign customers that are less sensitive to FX rates or more BRL funding at fair costs coming from local institutions. Yeah, I'll take that. I think many of you may have seen the press about there's this program in Brazil to kind of make, you know, popularize flying. I don't know if that's the word in English, but, you know... And we've opened up communication with the Brazilian government, and we've opened up communication on jet fuel prices, on litigation expenses in Brazil, and the cost of capital, right? And so if you think about it, BNDES, which is a development bank for Brazil today, is financing engines for Southwest Airlines, Alaska Airlines, it seems crazy, but have not provided capital to the Brazilian carriers in the last five years. Doesn't make sense, right? And so the government regime change, I think, has been very positive because today in Brazil, for example, it's import price parity. So what Petrobras does is says: "What's your next best option, John? Oh, you have to go to the U.S. Gulf Coast, drag the fuel all the way down to Brazil, import it, blah, blah, blah," ends up being 30% more expensive. But the new government is talking about, what about export price parity? What if Brazil and Petrobras sold to Colombia, Chile, Mexico, and others? They certainly couldn't sell it for 30% more expensive than what they have today, right? They'd have to get it down to be what the pricing is. So I think there's some structural changes in Brazil that are on the horizon, and I think, you know, President Lula, you know, he thinks, and rightfully so, during his first mandate, a lot more people started traveling. That was the beginning of Azul, when it was 0.3, and we took it to 0.5. He wants to see more people traveling, and he wants to see more unique travelers in Brazil. So he's asked the question, and he's been very vocal about it. He's sent tweets about it. He wants more people traveling in the country. So as airlines, we're going through, what are those structural changes that need to happen? Number one is fuel price in Brazil, right? Number two is litigation in Brazil. Number three is cost of capital in Brazil today. You know, the U.S. carriers today are, you know, get capital in the U.S. market. The Brazilian banks do not lend to Brazilian airlines today. They don't do it, nor does the Brazilian Development Bank. But I think, you know, driving incentives so that happens, you know, we do so much good for the country, and so you can't, you can't not help the airlines during COVID and then also be disadvantaged on the backside of it. And I think, as Alex said, we got a fuel tax reduction or a revenue reduction on PIS/COFINS, but I think there's a lot more work to be done to make the, the market a lot more competitive overall, and it starts with fuel prices. Thank you, John. Victor Mizusaki from Bradesco has some questions, as well. So the first one is: How do you see the airline consolidation trend in Latin America? Do you want to answer this one, and then I go to the next one? We tried. No, but I think, I think, you know, pure consolidation, full M&A, I think is probably off the table. But, you know, like, I would not, you know, discredit, you know, cooperation, agreements, code shares, joint ventures. I think, again, if you have an airline industry that's focused on, you know, making money and, you know, reducing, you know, costs to the consumer, I think there's always opportunity in that front. But in terms of full M&A, you know, I don't see anything on the horizon. I don't know, Abhi, Alex, what your thoughts are. Do you think that makes sense to spin off or IPO the subsidiaries? No, I think, you know, I think it used to be fashionable, right? And now the pendulum has swung the other way. We always wanted to have the optionality, but we always knew it was an expensive source of capital, because in Brazil, when you spin off a subsidiary, if you have NOLs on the original company and you don't have NOLs on the new company, you don't get to consolidate, right? So normally, what happens is, if you keep the subsidiary in-house and you have NOLs, you're gonna pay anywhere between- ... 24% corporate tax all the way down to 0% corporate tax, right? But if you spin it off and you have no NOLs in the NewC o, you're gonna pay 34% corporate tax, no questions asked. So normally, there's a huge plus, you have dyssynergies, you have misalignment of incentives, right? You have noise. And so, you know, when it was fashionable to spin off loyalty programs, we looked at it, we did the math on the cost of capital. We saw that we have cheaper capital elsewhere, so we never did it. And then the other guys kind of think saw the same thing and unwound the spin-offs that they had done. I mean, never say never, right? So we always have to do the math. If for some reason it does make sense, we'll look at it. But today, I think when you look at the economics, there's no reason to do it. Thank you, Alex. [Foreign language] filed for Chapter 11. Do you see any change in airlines and to Azul environment because of that? Yeah, so, just for the, so those that don't know, there was a travel agency in Brazil called 123 Miles, that filed for Chapter 11. They never bought directly from any of the airlines, so there's no exposure to the airlines. They bought via travel agencies, so there is some exposure there. They got into trouble because they were selling tickets that didn't exist. I know it sounds a little bit crazy, but they would basically sell a ticket to Dubai in 2025 for price X, and then they would hope that until then, they'd be able to buy that ticket cheaper than what they sold it for. So it didn't happen. Air prices have gone up, and so that started the downward spiral to their bankruptcy. But overall, I generally see a more healthier industry. Thanks, Abhi. The next one is: Do you think that Galeão Airport can become a relevant hub like Viracopos, Guarulhos or Confins? Yeah, another interesting discussion regarding Rio. You know, I think that the challenge in Rio has never been sort of connectivity, it's demand, right? Rio is a beautiful city. It's a little bit like it inbound a lot of demand, but doesn't generate a lot of traffic. And so its geographical location also doesn't make it that suited for a hub. So I think it's gonna be an important market, a relevant market, but I don't see it taking the scale of some of our other hubs. The next question comes from Bettina, from UBS. How long do you think will last this competition dynamics? It has been tough in the past, but at the moment looks very healthy. You know, I think when we talk about competition dynamics, you know, what messes up competition, right? Somebody going after market share, growing too quickly, or somebody trying to kill somebody else, right? And so, you know, first of all, the OEMs, if I said I want 20 aircraft in the next two years, they don't exist. Alex kind of stated that. Not even the leasing companies have aircraft to bring to the market. So I think it's gonna keep discipline in terms of capacity for the next couple of years. And Abhi kind of highlighted where we're flying, our hubs, where our competitors are in those same hubs, and likewise, too, right? Like, for example, Guarulhos today, Abhi is half of what he was in 2019 because Abhi's focusing on where we're strong, and they're focusing on where they're strong. And so I think there's really good dynamics in the market. And again, I wanna highlight, GOL's not going anywhere, LATAM's not going anywhere, Azul's not going anywhere, and every single airline has a higher cost of capital. They've levered themselves up with more expensive debt, and there's IPOs on the horizon. So I think, you know, if you take a look at the shareholding structure of the Abra Group, the shareholding structure, you know, with Sixth Street and SVP inside of LATAM, they need to... You know, they're capitalists. They need to make money, and then, and that's, that's what they're focused on. So I think the competitive dynamics in Brazil have never been better, and I think the facts are in the results that you're seeing, right? And I think that that's something that not a single person, not even us out here on stage, thought that we'd have fares where they are today in Brazil. Nobody thought they would, but that's where we're at today, and I think that it's a much healthier environment, and I think everybody's comfortable with where we are today. And again, fuel prices go up, fuel prices go down, and fuel prices went up, and you, Abhi showed you what happened to fares when fuel prices went up, and that's what should happen. Thank you, John. Guilherme from JPMorgan is asking: How should we think about non-tax business in two to three years in terms of revenues contribution to the Azul, Azul Viagens, credit card and others? Yeah, definitely gonna grow faster than the airline itself, so the percentage is going to increase. I'm very, very optimistic about the loyalty program and the credit card especially, and the quality of customers and account holders that we're bringing in. Cargo's had a tough year. Admittedly, worldwide, it's been a tough year. We are growing in Brazil about 8%-10%, but internationally, it's been tough. That's gonna rebound next year. And vacations has a lot of room forward. So, it's gonna grow double the rate of what Azul is gonna grow. Thank you, Abhi. How has been the ability to pass through prices following the recent oil spike? Do you sense that competitors had a similar approach? How should we think about the hedging strategy going forward? ... Yeah, talking about competitors and fares, I think everybody has a very, very similar approach. Again, we are entering the best season in Brazil. It's spring, summer, so we have good seasonality and good demand behind us right now. You know, I think there's a clear contrast to what you're seeing in the United States, right? So you're seeing softness in the United States, but you're seeing strength in Brazil. Abhi showed that we have record average fares and our best bookings ever with the last couple of weeks, going into the strongest part of the year. Hedging is insurance, right? So we expect to lose money on insurance. We expect, you know, a little bit. You lose that premium, right, to get that protection, and we expect to lose a little bit of money over time on hedges, right? And I don't think anybody buys Azul because you think that the three of us know, you know, what the direction of the energy prices in the world is going to be better than the overall market, right? So it should be insurance, you know, and as insurance, you should try to price it competitively, and if it's cheap, you should buy more of it. If it's expensive, you should buy less of it. You know, I think today, when you look at the industry overall, everybody's essentially under-hedged compared to historical levels. That's certainly the case in Brazil. We're all kind of in the, maybe the teens. You know, I think that's what makes sense, given the cost of capital, the cost of credit limits, right? Really, I think the best hedge that we have is the fact that we're price makers on 81% of our routes, or maybe 91% of our routes, right? We determine the fares on those markets, and they need to be profitable. And if fuel prices are high, we're going to set fares at a level where we can make money. And if fuel prices are low, maybe we can fly a little bit more and set prices accordingly, right? So I think a robust network, where you have the ability to price optimally, is the best hedge that you can have. Thank you. Lucas from BTG wants to understand more about our international strategy, especially regarding overlap with LATAM. Yeah, again, like I said, we actually have no airport-to-airport competition. Obviously, they fly to Paris as well, and Lisbon, but, from a different airport to a different airport in terms of Paris, and Miami as well. So, different partners, different, types of, service options, but again, for us, it's where we are strong to where our partners are strong. No airport-to-airport competition. So, I think you'll just see more of the same, and continuing the philosophy we have domestically, internationally. Keep in mind, there are 100 cities that Azul connects internationally that are not served by any other airline in Brazil, right? So if you're in one of those 100 cities and you wanna go to Paris, or you wanna go to Fort Lauderdale, or you wanna go to Chicago or anywhere, the only way to get there is via Azul. Thank you, guys. The next one is, any additional comments regarding the tax reform and the Brazilian economy going forward? Yeah, so I think, many of you locally may have seen, but there's a new tax reform going on in Brazil. You know, we were pretty excited because regional aviation was included in that. That was something that we worked really hard on. I think we've partnered now with the other airlines to get general, all aviation included, and I think, you know, the importance of the industry... So we're very optimistic as an industry that all aviation will be included, and maybe there'll be some special benefits to regional aviation. But I think, you know, we feel very, very good about where we're at. Again, I said at the beginning, but, you know, GDP has been revised up to be 3x what they thought it was going to be at the beginning of this year. So, you know, demand is strong in Brazil today. The economy is moving, and so, you know, I think we're pretty optimistic as to where the Brazilian market is, relative to where we thought it was going to be, right? And so, you know, I still think it's growing a lot slower than most people would like it to grow, but relative to where it was supposed to grow this year, it's significantly better. Thank you, John. Rogerio Araujo from Bank of America has one question: Could you provide a best guess for 2024 EBITDA range? How much capacity growth versus 2023, assuming fleet upgauging and higher aircraft utilization, and what about yield variation? Well, why don't you take that, Abhi, to start, and then- Yeah. I'll let Alex- Capacity growth is gonna be about 8%-10%. You know, yields, I expect to be pretty similar to what we're seeing this year. Remember, our capacity growth is upgauging. It's in our markets. It's not in competitive markets. And so I think what we've been seeing all along, the unit revenues we are seeing now, are pretty constant since Q3 of last year, and I think they'll be pretty steady through next year as well. Yeah, on EBITDA, we don't have formal guidance on 2024 yet, but I think, you know, we know what consensus is, right? We think consensus, as it's natural, it's a little bit more conservative than what we think is achievable. But, you know, I think everybody knows the direction, right? And that's why we're excited about the valuation and the equity instrument that, you know, there is a significant CAGR on EBITDA going forward, right? We had significant CAGR on EBITDA when we went public, right? That's why normally you see a higher multiple in Latin American carriers, and we still have a significant CAGR on EBITDA. So 2024 EBITDA will certainly be higher than 2023 EBITDA, and 2025 EBITDA will be higher than 2024. And I think that's what we see in all of your models, as well, because of all of the upsides. So think about, you know, why is 2024 EBITDA gonna be higher than 2023? We don't even have a full year of Congonhas in 2023, right? We started Congonhas at the end of March. There is some ramp-up, there is some, you know, advertising, some awareness generation that needs to happen. So we're gonna have a full year of Congonhas in 2024, right? Fuel prices for 2024 will be lower, you know, throughout the whole year, versus, you know, the average of 2023, right? That's another source of value. Like Abhi said, the business units all grow more than the airline, and the airline is also going to grow next year. That gives the economies of scale, that gives you margin expansion. There are a lot of drivers for why you can believe on a continuously growing EBITDA beyond 2023. Alex is being cute 'cause he was notified by the CVM, because of comments he made to the press. But take our exit rate, take what we're gonna do in the third quarter, take what we're gonna do in the fourth quarter, look at the margin expansion drivers, and, you know, Alex kinda highlighted each of them, but, you know, those E2s coming on are really important to us. Once again, the fact that our entire senior management team is now focused on running the business, taking that utilization up. So I think it's pretty easy to see how we grow EBITDA from 2023 into 2024, 2025 and 2026. Thank you, guys. That's it. Anybody else here? No? All right. Great. Thanks, everybody. We appreciate, we appreciate your time today. We've got some food and, and beverages here, and we'll be around to take any of your questions. Just for everybody that's listening, Alex and Thais and myself, we're gonna be on the road for the next three weeks, and so meeting at many of the conferences. But feel free to reach out to our team. You can have Abhi, you know, at any time you wanna talk fares and network expansion. So we're really excited about the business. This is truly a re-IPO of the business, a much stronger, a much better business. Again, you know, our EBITDA is 3x what it was compared to when we went, when we went public. You know, we're 40% more efficient as an airline. We now have the lowest CASM in the country by far. We have the highest margins, and so we're very excited, and we're not going anywhere. We're gonna continue to grow this business, and we thank for your support.