Good morning, ladies and gentlemen, and welcome to the audio conference call of B3's earnings results for the first quarter of 2023. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session, and instructions to participate will be given at that time. If you should require operator assistance during the call, please press star zero. As a reminder, this conference is being recorded and broadcast live via webcast. The replay will be available after the event is concluded. I would now like to turn the conference over to André Veiga Milanez, B3's Chief Financial, Corporate and Investor Relations Officer, who will be joined by Fernando Campos, Investor Relations Associate Director. Please go ahead. Thank you. Good morning, everyone. Thanks for joining our first quarter results call. The first quarter, we found a still challenging scenario, with an environment where interest rates remained at very high levels in Brazil. A lot of uncertainty, not only in relation to the local economy, but in relation to the global markets as well. Particularly in Brazil, uncertainties about the fiscal policy, which ended up impacting our performance during the quarter. As a result of that, we posted gross revenues of BRL 2.5 billion, a reduction of 3% and 4% respectively in relation to the first quarter of 2022 and the fourth quarter of 2022. If we look at the volumes, particularly for the stock market during the quarter, the reduction that we saw in the average daily trading volume was mainly the result of the compression that we saw on the company's market cap. We remained with a turnover velocity very healthy above 150%. Fernando will comment a little bit more on the operational performance of each one of our segments. I think it's worth highlighting here once again the strength of our diversified business model. It's particular here, I would like to highlight it, the performance on our listed derivatives segment and on the over-the-counter segment, on the OTC segment that ended up offsetting the reduction that we saw on the stock market. In relation to, I think, as we mentioned during the first quarter results call, we did have, we did see an acceleration of our expenses during the first quarter. They were also impacted by non-recurring items, particularly non-recurring items related to efficiency initiatives that we started or carried out during the second half of last year. The first quarter this year, without any, let's say, large non-recurring items, we already saw the positive impacts that those initiative presenting a reduction in total expenses both against the first quarter of last year and the last quarter of last year as well. I think it, I would like to reinforce here our commitment with cost discipline. I don't think that has ever been away from our agenda, but perhaps we're gonna give a special attention to that, to that matter now. We will continue to look throughout the year at expenses very carefully, always seeking to optimize our cost structure without having to compromise our growth strategy. As I mentioned in other occasions, our goal is to be on the lower range of our expense guidance for this year. I'm going to call Fernando now to talk a little bit about the operational performance of each one of our segments, and I'll get back afterwards. Fernando. Hey, everyone. Good morning. Talking a little bit about the operational performance for the quarter, starting with our cash equities. We saw an ADTV of BRL 25.2 billion on the cash equities market, 20% below the first quarter last year and the fourth quarter last year. I think here, just to reinforce what André mentioned before, it has much more to do with the compression, the reduction of market cap of companies because we still saw turnover velocity at high levels, about more than 150%, 153% to be more precise. I think it's important also to highlight the decrease in margins in the fees of the cash equities market, and that this retraction when we compare to the first quarter last year, although we saw an increase compared to the fourth quarter last year, reflects the investment that the company is making on strengthening its Central Book, when in a year and 2% quarter-on-quarter. This line mainly growth with the funding industry, which is in which we are seeing an increase in the fixed income funds during this period. It's also worth highlighting the growth in Neoway's revenue, which grew 15% year-on-year, although we saw a small decrease quarter-on-quarter given the loss of a client that was important for Neoway in the period. Now I'm gonna get back to André to talk about the financial results, return to shareholders and other highlights. Thank you, Fernando. Our financial results during the quarter was positive, we posted around BRL 142 million. The increase that we saw in the financial revenues is mainly explained by the positive result that we achieved by repurchasing approximately $50 million related to our bond during the quarter. This is in line with our strategy to keep an active role in managing our liabilities and seeking for opportunities to optimize our capital structure. Although we had that positive result, we also had a lower average cash balance during the period. The result with the repurchase of the bond was able to more than offset that lower average cash balance. I think it is important to say that this positive result does not necessarily will not necessarily reoccur during the remaining of the year. Of course, if we see opportunities to, again, to maximize shareholders' return, through the management of our liabilities, we will seek to do that. I, we cannot, you know, we cannot ensure that this will be the case throughout the next quarters. Our recurring EBITDA totaled BRL 1.6 billion, with a margin of almost 73%, 73.5%, and the net income attributable to B3 shareholders reached BRL 1.1 billion. During the quarter, we also distributed a total of BRL 740 million. Around BRL 400 million were deployed in the repurchase of our shares, the remainder was distributed to shareholders through interest on capital. On this topic, I think it's also important to mention that during the quarter, we canceled around 280 million shares that had been repurchased during the prior year, and which represent almost 5% of the company's total shares. Last, I think, you know, it is important to mention that despite our strategy of expansion in other segments, a large part of our efforts or most of our efforts remain dedicated to our core business and focused on development of new products and new services. We do still have a very robust roadmap of products for the remainder of the year. We have continued to make progress in the discussions with the regulators around our block trading facility. We do intend to be the first ones to offer these solutions to our customers and to the market. Our expectation, providing that these discussions and the approvals go according to what we expect, that we should be able to launch our new block trading facility by the beginning of the second half of this year. Also, I think another important update in relation to our new businesses and initiatives during these last months, we have obtained all the necessary regulatory approvals for the acquisition of Neurotech that we announced at the end of last year. We are still waiting the fulfillment of, for certain, precedent conditions that do not involve regulatory approvals, but there were other conditions that needed to be met for the transaction to be completed. We do expect those conditions to be met soon. With that, we will finally be able to announce the completion of that transaction that was announced last year. I think those were the main points that I wanted to make. I now open the floor for questions that you might have. Thank you. Thank you. Ladies and gentlemen, we will now begin the question and answer session from investors and analysts. If you have a question, please press the star key followed by the one key on your touch tone phone now. If at any time you would like to remove yourself from the questioning queue, press star two. Please hold while we collect your questions. Thank you. Our first question comes from Tito Labarta with Goldman Sachs. Hi, good morning, André. Fernando, thanks for the call and taking my question. I guess my question following up a little bit on the expenses, you know, good job in the quarter, there controlling the expenses a bit. Just is there room to control costs more? I mean, I think particularly just given the environment we're seeing with volumes, kinda being relatively weak, how much does that influence how much you want to do on expenses? Like how much of that is like, within your control? And is there room to cut more? And if volumes were to come back, would you be less focused on expenses? Just, you know, it's kind of an indirect question on your margin outlook. Just to think about, you know, how much control on the expenses and, if there's more room to, you know, keep costs under control. Thanks. Thanks for your question, Tito. Thanks for joining our call. Tito, as you know, we do have, let's say, a cost structure that is to a large extent, almost fixed in nature. There's not a lot of variable costs that we can start cutting. Most of our costs, as you know, it is concentrated in people and technology expenses. I wouldn't say that we have been paying less attention when, you know, a tailwind was more favorable. I think what we did, first we decided to start to explore new initiatives, and that explains in part the increase that we've saw in our expenditure. Also something that I've already mentioned in other opportunities, but, you know, during the last two, three years, what we started to see also was, that's probably not the best term, but, some sort of migration of expenses that were previously being capitalized, or being treated as CapEx now being treated as expenses or investment expenditure, most related to, you know, development of internal platforms and internally developed platforms and solutions. Mainly given the changes that we have been making in terms of how we carried out those initiatives, with the adoption of agile methodology, starting to use much more the concept of MVPs, and also the increase in the adoption of cloud computing for those new initiatives. I think that explains to a large extent what we have seen during the last years. Having said that, of course, we do recognize a more challenging environment. We perhaps decided to give a little bit more focus on that topic. We do believe that there is still room to keep seeking for efficiencies during the year. At this point, all I can say is that we are definitely targeting to stay at the lower range of our guidance, that was announced at the end of last year. Great. That's helpful. Thank you, André, for the color there. Maybe one follow-up more I guess on the new initiatives and Neoway and Neurotech, you know. Just update on, you know, when you can see some benefits from that. You know, I know it's kind of a longer term type of strategy, but, you know, when can revenues maybe start to benefit from those investments? And how are things going there with the integration, particularly with Neoway? We as I mentioned during my highlights, we are expecting to have the completion of the transaction with Neurotech over the next few weeks. There will be a lot of work to be done in terms of integrating is not the right word, but connecting all these three companies, B3, Neoway, Neurotech, seeking for the revenue synergies that we have envisaged during the acquisition. You know, our ambition is for that to become a more relevant, representative segment within B3. I think the integration or the connection of these companies is going well. You know, this year is gonna be a key year for us in terms of starting that right and seeking the growth that we have planned or we have imagined during the business plan elaboration of those companies and delivering that. Also, you know, trying to capture all the potential synergies that we could have in between those companies and between B3 and working on a roadmap of new products that can be either enhanced or developed now that they will have access to B3's data. I think it is going well, but it's still early for that to be representative. Our ambition is for that to become more and more representative, as part of our overall revenue pool. Okay. Perfect. Thank you, André. Thank you, Tito. Thank you. Our next question comes from Antonio Ruette with Bank of America. Hey, guys. Thank you. Thank you for the time and congrats on the results. I'd like to explore a little bit, a theme that Tito mentioned. On sharing operating leverage with clients. When you look at your margin today and your fees and equities and other products, how do you think about being from now on, especially considering competition? Thank you. Thanks for the question, Antonio. Look, as we discussed, I think the main, the main questions that we had in relation to our pricing policy have been addressed two years ago. Our pricing policy was preventing potentially the increase of volumes. Two examples that we already discussed in relation to that were, you know, fixed fees in our depository that were potentially preventing the expansion of the retail investor base. Also, you know, the level of discounts for high frequency traders that are much more sensitive or elastic to our prices, where we needed to potentially offer larger discounts for them to be able to increase volumes. I think most of those issues, or all of them, have been addressed during that big pricing revision that we carried out. We don't see the need for any changes in terms of our pricing policy at this stage. We will keep managing our pricing policy and monitoring that very closely. From time to time, we are making fine-tuning adjustments, but I don't see the need for any significant revision at this point in time. All right. André, if I may follow up on this, how do you evaluate competition today, when you look at the equity business and OTC? Thank you. Look, we have competition on the OTC business at least for five years. This became part of our day-to-day activities. Having competition is healthy, and we have been able to maintain our position on those markets. That has made us to be, let's say, potentially be more even closer to our customer base. We are very confident that we will keep being the preferred choice for our customers on that. On the equities business, as you know, we already have some sort of competition with, you know, global markets already compete with B3. The only thing that we do not have as of today is an alternative trading venue in Brazil because we already compete with other exchanges with ADRs when companies decide to list abroad. This is already competition for us. We have been preparing for a moment where a new trading venue could appear in Brazil. In our view, chances of success are higher when there is product differentiation. If you take the example of Australia, which the Chi-X was more successful in entering the market because it explored product offerings that were not being developed by the incumbent exchange. We have been working in a very robust roadmap products since B3 was created. All trying to offer all the products that the market was asking for, sometimes even trying to anticipate potential demands coming from the market. We do feel very confident that we have not left any gaps to be explored, and we are ready to face competition if that's to be the case. Perfect. Thank you. Thank you. Our next question comes from Pedro Leduc with Itaú BBA. Thanks so much, guys. Just quickly on the data and technology revenues, based on the pipeline of products and processes you've streamlined, data gathered, what can you tell us about the trajectory for these revenues going forward this year, first? The second, just on the operating leverage and profitability levels that you've achieved, assuming throughout the year revenues do pick up, if you could see this operating margin level we saw this quarter more as a floor and it will progress throughout the year. Thank you. Thanks, Pedro. Thanks for hosting us during the last few days here. In relation to margins, I mean, as you know, our margins, giving the level of operational leverage that our business has, our margins are much more sensitive to the top line than anything else. As I mentioned, we will continue to pay special attention to expenses without having to compromise our strategy to keep diversifying and delivering growth. Having said that, you know, the behavior of the margins going forward will be, you know, much more subject to the performance of the top line than anything else. We will remain very focused and committed to cost discipline. You know, the behavior of the margins will largely depend on what to expect for the remainder of the year, especially for the cash equities market that represents a significant portion of our, of our top line. And in relation to the data business, as you know, of our strategy here, besides, you know, monetizing or extracting value from this very unique asset that we have and that was not being explored and trying to extract the full potential of that, we also are aiming to diversify further our revenue pool and bring more revenues that are recurring in nature and transactional or less cyclical. Those business that we acquired, have been growing between 20 and 30%, and our expectation is to at least maintain that pace of growth, or even try to accelerate that with, you know, with the connections, between B3 and this company. That's what we will be seeking to achieve in terms of the data revenues. Thank you, and congrats on the quarter. Thanks, Pedro. Thank you. Our next question comes from Ian White with Autonomous Research. Hi there. Thanks for doing the call and taking my questions. I just have a few please. First, just a bit of a follow-up on data and analytics. I wonder if you could just explain a couple of things please. Firstly, what portion of the data and analytics revenue is booked as point in time services versus sort of recurring subscriptions? I guess I'm just trying to understand why those revenues stepped down from Q4 2022 into Q1 2023, whether there was anything I was missing there. Just following up on a previous question, can you set out perhaps sort of what specifically are the new product developments or sort of sales opportunities you expect over 2023 within data and analytics? What's in the pipeline there please? Those are questions one and two. Just finally, on litigation, doesn't seem to be sort of much update in the financial statements, so assuming not much has changed. Can you just maybe provide an update on the two sort of main areas there and when you think, some of those cases might ultimately be completed? Thanks very much. Thanks, Ian. I'll start with the last one. Unfortunately, there's not a lot of update there. It will still take a while to have some resolution on those matters. Again, we remain very optimistic in the outcome of those two issues, but unfortunately, not much I can add or no significant developments on those matters more recently. In relation to the data question, I don't have that information now from the top of my head in terms of how much of that is recurring and how much is non-recurring. A large proportion of the data revenues is recurring in nature, but I don't have the percentage to give you now. We can follow up on that with you later on. What explains the situation you described was that mainly during the last quarter of last year, we did have some large non-recurring sales that occurred and that did not repeat during this first quarter of 2023. In addition to that, one large client that ended up canceling its contract. The churn rate was slightly higher during this quarter. That explains to a large extent the situation that you saw and that you describe. The vast majority of those revenues are recurring in nature. In terms of the roadmap, I mean, there are a lot to be done, particularly once we finally have the conclusion of the Neurotech transaction. Neoway has already been working in the development of new products and enhancing its products with B3's data. Opportunities of cross-selling, so Neoway selling data solutions to B3's customers such as, you know, large brokers, et cetera, have already started to occur. The same will take place once Neurotech's acquisition is completed. I don't have details of specific products to discuss here now during the call, but there are, and we can potentially explore that further in future opportunities in terms of more details about new products. Besides initiatives such as the ones that we already discussed, like the creation of a capital markets vertical within Neoway to start enhancing products that B3 was already offering and developing new products more dedicated to the capital markets. Very quickly, there are a lot of opportunities of cross-selling, upselling between the client base of these three companies that have very little, I would say, overlap, and increase in the value of the solutions because you are enhancing those products with the combination of the existing products and the use of B3's data. But we will have maybe to give you more color and flavor of new products specifically over the course of the year. I appreciate that. Thank you. Can I just squeeze in two short follow-ups, please? On the central bank transactions litigation, I think previously B3 had said there was more than a 50% chance that this would be settled on a three-year horizon looking from August 2021. Is August 2024 still kind of a realistic date where we think that that might be dealt with? Is that why you're saying no change, we could still use that as an anchor point? Just secondly, is there anything you can say about the client that canceled its data contract at all? Is there anything we should know there that's moving to a competitor or, I don't know, sort of consolidation or something like that was the underlying driver there? Thank you. In relation to the first, I mean, I don't think things have progressed as expected, honestly. So it is really, really difficult, especially when we are discussing the judiciary system in Brazil to estimate a timeframe. I honestly don't think this will be resolved. I mean, if you're aiming to have a resolution, almost, you know, we are in May, it's one year and three months ahead of us. I don't think this is likely to occur before August 2024. Simply because, you know, the process has not progressed in the judiciary system, has not moved at all during this period. I think it will take longer than that. Very difficult, for me to give you an estimate on when to expect some sort of resolution, in relation to that case, unfortunately. Fernando, can you give some color on the client discussion, to Ian? Sure. It was a client. The cancellation of the contract was in December. It was a client from the retail sector, which is as you know, in Brazil, retail sector is going through a kind of a hard time. It was much more of a cost man-management decision from the customer than anything else, okay, Ian. It was more related to the hard time that the retail sector. It was as you know, Neoway main revenue pool comes from sales and marketing, so it was a client that used that service on the retail market, which is going through a hard time. Okay. Thanks so much for those details. Really appreciate it. Thank you, Ian. Thank you. Our next question comes from Kaio Da Prato with UBS. Hello, everyone. Good morning. Thank you for the opportunity for asking questions. I have one question here in terms of the margins of the equity business. We only saw a small increase if you take a look on a quarter-over-quarter basis, even with much lower volumes. If I remember correctly, I thought you had some atypical movement last quarter that impacted the fees. Just would like to get a sense if we had any type of atypical movement this quarter as well, and how should we think about that going forward, if we can consider that this margin should not change too much throughout the year of 2023. That's it. Thank you. Thanks, Kaio. As we said, I mean, once the major changes that were implemented in our pricing policy, we should now see behavior in terms of average margin, much more in accordance with mix of products and mix of clients. This quarter, what we saw mainly was some changes in the mix of clients with a higher, slightly higher proportion of clients that have lower fees, in the overall composition of the volume. That has to do, to a certain extent, with the market making programs that we have been implementing and expanding. I don't see that evolving, let's say to a much higher proportion of the volume. Of course, we do not control, completely control, how much each one of these types of clients is contributing to the overall volume. There will be still potentially some fluctuations according to the behavior of each one of these groups throughout the year. I don't see reasons for that to fluctuate much more. Okay. Thank you. Thank you. Our next question comes from the webcast. It is from Mick Dillon. Can management please give an update on the impact of changes to interest on capital tax laws? Thank you. Well, the topic in terms of changes of Interest on Capital or the extinction of the Interest on Capital have been on the table for a while. In isolation, that measure, of course, would have an impact for the company because it would take away the tax shield that we have today of over all the Interest on Capital that is paid to shareholders. Again, it's really difficult to say exactly what's gonna happen. In the past, there were discussions of the end of the Interest on Capital tax benefit together with reduction in the corporate income tax and taxation on dividends. The discussions now or news around the potential termination of this benefit again are... This is a topic that is already once again in the news. Meaning the impact would be negative to the company. If I'm not mistaken, we are talking about potentially a benefit of around BRL 300 million-BRL 400 million a year in tax benefits. Again, this will depend a lot on how these discussions will evolve during the course of the next months. Thank you. Ladies and gentlemen, this concludes today's question and answer session. I would like to invite André Milanez to proceed with his closing statements. I just wanted to thanks everyone for joining our first quarter results, and thank you all for the support as usual. Also take the opportunity to thank all the finance team to putting together all the materials for this quarter release. Thank you for your support. Have a nice Friday and a lovely weekend. Bye-bye. That does conclude B3's audio conference for today. Thank you very much for your participation. Have a good afternoon, and thank you for using Chorus Call Brazil.