Good morning, ladies and gentlemen. Welcome to BRF's Q1 2021 earnings video conference. We'd like to inform everyone that this conference is being webcast at www.brf.com.br/ri, where the presentation is also available. At this moment, all participants are connected in listen-only mode. Following the speech, we will have a Q&A session when instructions to participate will be provided. We ask that each participant ask only one question. Should you need assistance during the conference, please press star zero to reach the operator. The statements made during this conference about the company's respective businesses, projections, and potential growth are merely forecasts based on management's expectations regarding the future of the company. These expectations are highly dependent on market trends and the general economic performance of the country, the industry, and international markets, and are therefore subject to change. Please note that this conference is being recorded. This video conference will be presented by BRF's global CEO, Mr. Lorival Luz. The vice presidents of the company are also present. We will now turn the floor over to Mr. Lorival Luz, who will start the conference. Mr. Lorival Luz, you may proceed. Good morning, everyone. Thank you. Thank you for once again being here with us in our earnings video conference. I'm at the office, but because I'm in an environment with adequate distancing, I will take off my mask so that everyone can hear me with more clarity. I'd like to start by talking about our results and the competitive advantage of BRF's. I think it's important for us to think about Q1 2021, when despite the absolutely challenging environment, an environment where we still have COVID and we're still dealing with a number of restrictions, particularly in regards to food services, not only in Brazil, but outside of the country, we proved to be absolutely resilient. We showed strong margins with a result of BRL 1.2 billion, and we were able to reverse last year's losses into a BRL 22 million result. It's also very important to mention our positive cash generation of BRL 700 million, despite once again this being a quarter fraught with challenges in our stock management and also with aligning our strategy since last year with regard to management and the search of excellence. We've proven that we were able to do that with incredible excellence. Our net leverage was below 3, 2.96 times despite a BRL 5.70 in the foreign exchange. Once again, our debt maturity is extremely long, which ensures financial stability for us to continue making investments and to advance in our 2030 Vision. When we look at both our gross debt and our EBITDA, we see that even this year, when we had about BRL 80 billion impacting our EBITDA because of COVID, we continued to deliver a BRL 1.2 billion EBITDA, which is the same as we had for this period last year when we were still not feeling the effects of COVID and also not feeling the effects of the rise in commodity prices, particularly grain prices, which I will talk in more detail later on. Despite all of these challenges, we were able to adequately manage ensuring profitability and financial balance for the group as a whole. I'd also like to stress and call your attention to everything that's going on and the effects that those challenges are having on the industry at large. We've been talking about this since last year when we decided to manage our raw materials, and going from 2020 to 2021 with the highest level of raw materials, especially corn and soybeans, which are at the basis of our costs. That ensured that we had an absolutely efficient first quarter, and that we continue to see costs below market, which will also have impacts for the second quarter of this year. I'd also like to stress the margin our producers, both pork farmers and poultry farmers have had. That's in the lowest level on record since 2014. Now, why is that? The market data all of you have access to already show that corn prices have virtually increased twofold since last year. Soybean oils and soybean meals have also increased by as much as 5%. The same thing has occurred with packaging, both rigid and flexible, as well as corrugated board, all of which are raw material for our production. Every company has suffered with this significant increase in costs, which we can see on the increased index, production index, found by Embrapa. This has been going up since 2019. Consumer prices haven't been matched yet. They do not reflect the increase in these costs yet. Nevertheless, we continue to manage our production so as to continue to maintain our margins. This clearly shows the need to rebalance our company in financial and economic terms so that we can reestablish the economic sustainability of our food production, both with poultry and pork products. As I said, this scenario of increased costs is not yet being seen in our consumer prices, but that's something we're likely to see in Q2. In addition to that, we have been working a lot in what we talked about last year, advancing our high value-added products. Our added value went from 52 to about 74%. What that means is a better mix of products, a better assortment, innovation, new products being put on the market. As you can see, a significant share of our revenue in the Brazilian market comes from new products. This is a guideline we have at the company. We want to be increasingly more a food company that provides high value-added products to our consumers, as well as a better mix in terms of profitability. That we have been doing in tandem with maintaining preference among consumers. With the rate of preference, the new products, and our positioning in their preference, our products with Sadia, Perdigão quality, and even internationally with Banvit, we've seen an increase in preference as you can see in this slide. Another factor it's important for us to stress is the resilience of our portfolio. Even though per capita income is still low in Brazil, and although the prospects are that it'll increase in the next few months, quarter cuts and whole chicken prices are still higher than their pork counterparts. As you can see, it goes up to eight times the price, which shows that the scenario moving forward gives us the prospect that the downtrade for consumers may benefit both pork and chicken processes or products, because consumers want more for the same money. Our growth prospects and sales volume prospects for Brazil are absolutely encouraging considering this scenario we're describing and demonstrating with our figures, as well as the competitiveness of our products. Another important factor that has an impact, especially in the international market, but which also reflects or reverberates in Brazil, which is the African swine fever, is shown in this chart. As you can see, prices continue to reflect the challenge that we see in this industry to reestablish the same level of productivity we had back in 2020. As we said some time ago, this is not something for this year and not for next year, probably. It should take at least two years for us to resume that same level. What we understand is we will still see a bright scenario in terms of Brazil's and BRF's ability to continue exporting and to still have a booming market, especially with the Chinese demand. Another factor I think is important to talk about, and this is something you've heard over the last few weeks, are the measures taken by the SFDA in Saudi Arabia. They lifted imports from 11 cold houses in Brazil. This was some time ago. BRF was not impacted. We continue to be the main exporter, and our cold storage houses continue to export to Saudi Arabia. That's something worth noting. A second thing worth noting is that Saudi Arabia notified WTO about a change in their understanding of the shelf life of our frozen chicken products from 12 months to three months. That absolutely has an impact and could have a greater impact on our exports considering the time lag between production and outbound shipments and distribution of products. What does that process look like? We have been working closely with the competent agencies here in Brazil. Other countries that are also producing and exporting to Saudi Arabia will also have to look into this, such as France and Argentina. What is that conversation going to lead to? In the next few weeks, we expect to have a position from Saudi Arabia. We expect to establish a conversation with their government, and we expect to reach a compromise, even because there is still a need from Saudi Arabia to import heavy chicken for the shawarma, chicken breasts, and other chicken products. Their local industry itself and food services locally also need a longer term than three months. This was something that took place last weekend, and they have a national holiday this week. I thought it was pertinent to explain all of this to you, or to mention it at least. Now, with regard to our capital structure, starting with our cash flow, we had a positive cash flow in Q1, which was especially because of our operational cash generation, especially in our operations themselves, which is to say our operations generated about BRL 2.4 billion, which was enough for us to conclude all the CapEx we had projected. This includes concluding our sausage factory and other lines of products which are also being expanded to meet the demand from the market. We're also keeping our leverage below three times with a debt maturity that's exceedingly extended. Now I'd like to call your attention to our cash position, which is about BRL 9 billion plus the credit facility and the very low short-term maturities for 2021, which is below BRL 700 million. The company is absolutely prepared and robust and with enough financial liquidity to allow us to go through Q2 despite the increase in costs with grains that we had. Our focus will remain on profitability and on a sustainable management of our operations. Also with regard to ESG, I'd like to specifically mention facts that are already in place and initiatives that are already in place. We have already signed the first contracts within the partnership we announced in December last year that include the sustainability issue and the production of solar panels for our outgrowers. This is something that's already underway. These panels are already being installed in our outgrowers' farms. Once again, our purpose is for every one of them to be self-sufficient in their energy production. Another thing I'd like to underscore is that also in Q1, the company announced a new program, a new initiative to donate another BRL 50 million, just as we did last year. Our position is, unfortunately, the pandemic is still underway, and for as long as that lasts, the company will stand behind the community and will stand beside society to help them with whatever we can and whatever is necessary. I'd also like to stress that investigations, both with the SEC and the U.S. DOJ, have been concluded. All investigations involving BRF, still within the realm of Trapaça and Carne Fraca operations in Brazil, have been concluded, but no charges have been imposed. We faced that with complete transparency and no penalty was imposed, which shows the transparency and integrity with which we have conducted and run the company in everything that we do. In the next slide, you can see also other initiatives we have been conducting within the company. These initiatives are absolutely manageable, and they will have an impact on all directors, on all their variable compensation, including myself. This will include 100% traceability of the grains we acquire by 2025. We will also reduce water consumption by over 13%. We will promote education and awareness-raising to reduce food waste, which is extremely important. At a time when food is scarce for a lot of people, there's also a lot of waste, and we need to work together with society to reduce that and to minimize that. We also plan to have 30% of the company's leadership positions being secured and being held by women by 2025. Also by 2025, we want to have 100% of our packages being recyclable, reusable or biodegradable, ensuring the sustainability of all of our products. In conclusion, the company continues to advance with our 2030 Vision, releasing and focusing on new products, whether they're ready meals or pork products. We've released stable shelf life products which do not require freezing or cooling. We also launched the Speciale line of products. We continue to work in different segments and different market niches, and we continue to launch products within our Veg & Tal line with chicken strips and also all of our products. I was asked to stop for a moment. I apologize. I was told I had a connection problem. I will continue to talk about our 2030 Vision. We're also launching new products within our pet line, and we're also launching the new Güd products, which should come to the market very soon. We're also advancing in our omni-channel, advancing our delivery platform, and also opening new stores with Sadia markets. Our company is still focused on our long-term view with very important measures being taken in terms of ensuring the continuity of our vision and with delivering our 2030 Vision. Naturally, not failing to deliver on our short-term results such as we are about to see in Q2. Again, we're launching new high value-added products with an excellent management of our production costs and innovating both in Brazil and outside Brazil. On that note, I will turn the floor back to our operator so that we can start our Q&A session. Before that, all of you have the opportunity to know our Mercato em Casa, our online sales platform. We have a QR code that you can use to access. With this coupon that we're handing out, you will also have 20% discount for your first purchase, which is valid until the end of 2021. That will be on the screen for all of you. I now turn the floor back to the operator to start our Q&A session. Thank you. Ladies and gentlemen, we are now going to start the Q&A session. We would like to remind you that each participant can ask one question. To ask a question, please press star one. To remove your question from the list, type star two. Our first question comes from Ms. Isabella Simonato with Bank of America. You may proceed. Good morning, Lorival Luz. Good morning, everyone. I have two questions to ask. The first one is related to costs. We can see that you have been talking about grain prices moving up, but not only that, other inputs as well, packaging, fuel. If you could provide some more details about it and how you are addressing those cost pressures so that we can understand how you're handling the packaging agreements and how can we estimate the impact on costs. Also in relation to the cost line, we have been seeing that the margins have been squeezed. If products are out of stock, what are your estimates when you look at the second half of the year or even when you look at the period of the beginning of next year? My next question is in relation to the international market. We can see an acceleration in USD price. Could you provide some information on how you are addressing all those price hikes and what can we expect for the future? Thank you, Isabella. Okay, here we go. First, let's talk about costs when we talk about grains and packaging and how we are managing all this. Isabella, in fact the company has been, and we believe we are very competitive in the way we define the strategy since last year. This ensured us a lot of competitiveness in the first half of the year. This is something that is going to happen in the quarters to come. It is very important to be very transparent and make it clear to all of you that the average cost of our inventories of grains or the average cost of other inputs and raw materials that we require, and you mentioned so precisely the packagings, are going to continue growing and moving up. We have a lot of competitiveness as for our outsourcing areas and to manage all the costs. For the second half of the year, the costs will impact our results and they will be on the cost basis of all industries. This is something that you can already see considering the production cost issued by Embrapa and we can see the reflection of the price hike. What we can see in terms of difference when we compare Embrapa's cost and our cost shows the efficiency of how BRF has managing this cost. The grains that we have is at the level of BRL 100. We have challenges presented by the future crops and in general, the production cost as we can see in the producer margin can affect all industries, all companies. This will lead to the need for the company to rebalance in a sustainable way all our operation. This is something that is going to be done because we have the responsibility and the commitment to make the sustainable management of the company in order to ensure a profitable growth of the company. Speaking of the international markets, of course, the international markets have been responding in a quicker way as to the price adjustments when we compare that to Brazil. The price adjustments is made globally because the basis of the input would impact all producers across the world. Corn is not only more expensive here, but across the world due to international factors. The base of the production cost has moved to a different level. Therefore, we have to rebalance and make all the price adjustments for the market and for the sales prices as we have seen in international markets. Then I will pass the floor to Patricio. He can provide us with more details as to how this change and this variation has behaved internationally. Patricio, if you could provide us with more details. Good morning, Isabella. Thank you, Lorival. In line with what Lorival Luz was saying, the grains have increased at the global level and the market, especially the producers, considering those who are exporters of animal proteins, Saudi Arabia, Japan, et cetera, they also import grains. We have seen this scenario close to October last year. Then we started to include those in our price lists, and then we were defining the way so that the local producers and the distributors as well, and all the clients and the customers could prepare for such an increase. What made it a bit stronger, and we are going to see this in a more material way in the next half of the year when we will present the next results, is that as to demand, some markets have been feeling the effect of the vaccines, and the people will start going to restaurants and everything. There is an increase in the cost, there's also an increase in the consumption, not only at home but also out. At the same time, a large number of producers in most countries are small producers, so they cannot have high inventories of grains for many months. They have to be very quick in their response. Sometimes they wait for us, they wait for leading companies such as BRF, where we are leaders in most markets where we operate. They wait for us to show the way. There will be an increase in the demand in those specific markets. Thank you. Thank you. Thank you, Patricio. Our next question comes from Leandro Fontanesi with Bradesco BBI. You may proceed, sir. Good morning, everyone. I have two questions. The first is related to the market share data in Brazil. You showed that there has been a reduction in the latest data, quarterly data. If you could make some comments on what are the effects. The second question is related to the leverage, which is within the target that you had established, which is below three times, and the CapEx was a little bit low, the expectations, and I understand that. I would like to understand whether that means that the growth plan will be delayed a little bit, the growth plan for 10 years. If you can accelerate this investment pace in the medium or long terms. Good morning, Leandro Fontanesi. Thank you very much for raising those two points. In relation to the market share, I'm going to pass the floor to Sidney to provide you with more details. It's always important to say that we did this, and you have been following the gradual growth of the cost basis. As a consequence, we needed to make adjustments to the prices of our product. This is something that was done in the beginning of the year. Every time that we do something like this, when we make a step ahead in terms of price, there is an impact on the market share because the company increases the prices and the market responds. We have, without a question, a negative impact on the market share almost at first when we make those changes. Since costs are increasing, as you can see, and we understand that this is not something that happened only in the first quarter. This is something that is likely to happen throughout the year. Cost increase with sales prices increasing, and therefore you will have specific impacts on the market share up to the moment when, again, this is going to level off and go back to normal conditions. I believe that this is an impact, that this happened in a macro way, in a specific moment. Before moving on to Sidney, talking about leverage. We understand that there is room to make the correct management of this leverage. We are now going to be favored in the second quarter with a lower foreign currency. Even with the operational cash generation that we have been experiencing, we are going to continue with our growth perspectives and following with our priorities for our 2030 Vision. We always say that we have the responsibility and the financial discipline, and also have the management focus on accelerating or reducing the speed of our actions. Up to the moment, considering the results that we have been posting, we are going to follow on with our plans according to expectations, considering all the results that we have disclosed. Now I'm going to pass the floor to Sidney so that he can provide us with more details in relation to the market share and obviously the impact that we've had in the first quarter. Thank you, Lorival. Thank you. Thank you for the question. Just to add, the market share reflects 50%. The other 50% are not covered by Nielsen, which is related to specific parts of the market share. As Lorival mentioned, we are always trying to find a balance in terms of cost, and we have to make the adjustments to the consumer. Considering our market position, since we are absolute leaders, what leads the process is to have this happen recurrently. In the first moment, the volume of sales and the market share will be affected on a temporary basis due to two items. In terms of volume, we need to make a correction in inventory levels. Before a price hike, companies tend to increase their inventory levels. This is something that happens. Considering that this cost is for all the companies and not only for BRF, we understand that this is a behavior that happens. This is behavior that will be felt in two or three months. Our strategy in terms of profitability is very disciplined. By means of our brand and execution quality, we strike this market balance. We never forget what has been established in our strategic plan. We grew in terms of added value. In a very difficult moment, in tough times, we have been able to protect our market share. In a scenario like this, we have been able to follow our strategy. Okay, great. We had some connection problems, but most of it I was able to understand. Could I ask another question? When you talk about the temporary effect of the price increases, which is normal when you implement something of the sort. They said this is more related to the retail market and the resistance that is usually felt. Is it only related to inventory adjustments or the competitors that take some time to adjust prices? Leandro Fontanesi, I think it's a combination of both. There are two things that we have to consider. I do not see that there is a resistance in the retail market. I don't see it like this, because I see that all those who are operating the market understand this fact that the prices have increased. What I see is a natural behavior. When we consider larger clients, they make a higher inventory before the increase, and then they have to make up for the inventory levels that when they come down. They have to make an adjustment because there is an inventory turnover, which is according to what we expected. There is a correction of the inventory levels. On the other hand, this is something recurrent. All the movement that we have seen in Brazil, especially in the past years. This is something that we have felt two or three times in relation to the main competitors. This is a natural process that we have seen. Of course that every time it happens at a higher speed, we see the associated effects. Since we are absolute leaders in all categories, we see this movement. I don't know if I quite answered your question. Yes, you did. It was clear. Thank you. Our next question comes from Lucas Ferreira with JPMorgan. You may proceed, sir. Good morning, everyone. My first question is probably directed to Sidney. Sidney, I would like to understand this margin recomposition process. Do you think it's going to be necessary to increase prices even further? Do you have anything already planned? Anything in your mind? Does it make any sense to think about an offer restriction so that we can see an acceleration of the prices in the domestic market? Would you like to reduce offer? If I may, could I ask a second question? Maybe this for Lorival or Patricio. Lorival, you said the points of Saudi Arabia of 60 days and wait for their final decision, and you do not know exactly the impact. If you could share with us the numbers, how much you have imported to them, what's your volume, and what would be, in an extreme case, plan B, and where you would allocate all the business considering your portfolio. Thank you. Thank you, Leandro. I'm going to ask Sidney to answer your question, and then Patricio will also contribute. There's something that I'd like to mention. The company understand the responsibility we have to continue producing food and provide services to the population. The company will continue being responsible so that no food will be in need. We are going to do this in a responsible manner. We are going to be responsible so that we can ensure the sustainability, the financial sustainability, so that the company and all of us, the industry, can sustain the growth of the demand that will be felt for proteins, both in Brazil and in the world as whole. It is very important to say that the world population continues growing and will continue to grow. It will continue to need food. We need to ensure the financial conditions so that they can be appropriate so that we can continue making investments and meeting this demand in a sustainable manner. This is what we are going to continue to do. We are going to rebalance and make all the necessary adjustments so that the premises and all the assumptions can be complied with. I'm going to pass the floor to Sidney if he wants to add anything in relation to your question, in relation to price increases in Brazil, and then Patricio will talk about Saudi Arabia a little bit more. Before the scenario of cost increase, we understand that we need to make adjustments to price. We understand that the second half of the year will have the impact of the adjustments that we have already made so that we can make a balance of this price equation. This is inevitable considering the cost increases that we have seen. Can I talk about Saudi Arabia? Yes, please. Thank you. Good morning, Lucas. Saudi Arabia can feel the impact considering all the scenarios, not only affecting the exporters, Ukraine, as Lorival mentioned during his presentation. There are other countries such as Argentina and smaller countries. It also affects the local producers because they would kind of freeze part of their production, 10%, 20% of the broilers they produce to make the adjustments of offer and demand, and also to provide to food service clients that need to have safety stocks. Everything that is produced at the local level that adds value, such as nuggets and hamburgers, are frozen food. This dynamic is highly affected. The main port of Saudi Arabia, in Yanbu, which is about 1,000 kilometers, and other cities are also more than 1,000 kilometers far. The distribution of the products to local producers and imported products, they need to be adjusted to this new standard. We still have not the results of the impacts. We are still analyzing the situation. We've been talking to our local partners, those local producers that produce in Saudi Arabia and also local producers that we have a conversation in relation to the industry. Everyone is waiting a little bit to understand how this is going to evolve. As Lorival Luz mentioned, we cannot growth so much. As you said, the smaller chicken have a very high impact. There is an increasing need for the consumption of protein, so we are always having this trade-off, so that we can serve the halal countries, so that we can sell the parts and other parts in other markets that are also growing a lot. When we see the world projection in terms of consumption, we understand that broilers will be needed, and there are options, but we have a commitment with some markets where we already have a relevant brand at Dubai and in Turkey. We have to continue developing product and investing in them and providing innovations. This is why when we send the communication, we said that we're still analyzing the impact because it's much broader than only if considering them as exporter countries. Okay. Thank you. Our next question comes from Mr. Victor Tanaka with Morgan Stanley. You may proceed, sir. Good morning. Good morning, everyone. Thank you very much for taking my question. My question is related to processed food in Brazil. I would like to know if the drop in volume of 5% was according to your plan of last year, or did you have any problems in relation to stock distribution, and the price differences were higher than expected? The other question is in relation to the mixes and what is for us to expect in the future. In terms of processed food, how do you understand the mix for this year? Margarines, for example. How do you see a possible downtrade in processed food? Thank you. Thank you, Victor. I'm going to ask Sidney to answer your question so that he can provide the details about the impact in relation to processed food. I would like to remind you that our strategy, as we have shown in the presentation, is to improve evermore and make adaptations to the mix, providing more and more products with added value product as we have been doing in the quarters past. Good morning. Thank you for the question. We have a very diverse portfolio that can meet the needs of different markets and different consumers. We make adaptations considering the seasonal aspect. In the first quarter, we had impact, and two factors have to be considered. First is the prices of the competitors. We had an impact in relation to market share, which was affected. Second, we had to make some adjustments to the retail market to the level of inventories, considering the situation. I do not see a downtrade characterizing this process. We can see that there's ever-growing demand for added-value products. This was a quick process. We understand, of course, that there is an initial impact, but adaptations will be made considering all the efforts that we have been made. I do not see a downtrade movement. I see that the volumes have been increasing in terms of pre-COVID period. Thank you, Sidney. Next. Thank you. Our next question comes from Mr. Victor with Credit Suisse. You may proceed, sir. Good morning, everyone. I believe that one of the points that we saw in the results was the margin dynamics. You explained the Japan with the higher stock level. This would take one year or a year and a half, so it's a long-term. Would you see the impact as a long-term impact? M&A is the second point. There has been some discussion in relation to M&A and everything. We would like to know whether or not you have a timeline in your mind. These would be my two questions. Thank you. Thank you, Victor. I'm going to answer the second question first, and then I will pass the floor to Patricio so that he can talk about Asia. In relation to M&A, everything follows according to 2030 Vision. The company has priorities which have already been defined, as we have mentioned, and we continue with the discipline, the financial discipline, evaluating all the opportunities. Up to the moment, there is no change in relation to what we had planned before and all the programming that we have disclosed on BRF Day. I'm going to pass the floor to Patricio to talk about Asia dynamics and the impact on Japan. Perfect. Thank you, Lorival. Thank you, Victor. Speaking of Asia in general terms, first, China is the main market or Asia as a whole. The region has a lot of demand. We have a demand of nearly 40% higher than we can provide in terms of products that we have as to availability and volume. As to prices, when you think about China, specifically, the prices that we had reached in the market last year, in the hardest times of swine fever, they went down a little bit because of the exports from the United States and all the expectations to have a recovery in the local production and everything else. The prices are still very high, and the income and the volumes are very high as well. When we consider the past months, we can see changes because cost increases. If we consider the information of February and March, we can see that there's a variation every month in an upward trend. This was caused also to the United States who want to import less because of the mask consumptions and all the vaccine effects and life going back to normal. Rumors of a second wave of swine fever, where the production is not as expected and economy is growing, as you can see. As we can see in general numbers, China continues producing and exporting. China is a market that we estimated that would have a normality in terms of prices in the future. We see other markets such as Korea, still talking about positive aspects, the stocks were very high, but the reduction of imports and the impact on the avian flu internally have made prices to be affected. We think about Japan, we see a different case. Japan was promoting to the local consumers. They were encouraging people to go to restaurants and everything else. Because of increase of prices and also the Olympic Games, they gave a step behind. We have seen some recovery in prices during a part of the quarter and also in the next month. We believe that this is something that is going to happen in one year or one year and a half. We are going to have a transition and will happen also as part of the third quarter. I don't know if it was clear, but thank you. Yes, it was clear. Thank you. Our next question comes from Andre Hachem with Itaú. You may proceed, sir. Thank you. I'm going to ask just one question. I would like to understand a little bit more in how you see the investments for the end of the year. You said you can make four major investments for this year that would accelerate quite a lot for the rest of the year. How do you see this? Are you going to revisit these numbers? Are you going to lower those numbers considering the more challenging scenario for the second half of the year? Good morning. As I said, I'm going to turn the floor to Carlos. He will provide more details about the CapEx for the year. Up to the moment, we follow our planning with all the initiatives that we have shared, but we always have the capacity to manage the speed and to accelerate any investments. We continue with all the regular discipline in relation to the planning that we have in terms of capacity increase and all the initiatives up to 2030. I will turn the floor to Carlos. Thank you, Lorival Luz. Good morning. The company has the principle of maintaining its financial discipline, which is represented by the maximal level of leverage, which is three times the EBITDA. We're going to continue with this principle, adapting our CapEx and our initiatives so that we can observe this limit, which is a commitment that we have made. This is the materialization of a financial discipline. Perfect. Let me understand. When we think about the second half, are you going to continue maintaining this target of billion or. Yes, it is possible to do that if our leverage level allows us to do that. Okay, perfect. It was so clear. Thank you. Our next question comes from Thiago Duarte with BTG Pactual. You may proceed, sir. Hello. Good morning, everyone. Thank you for the opportunity to ask questions. I would like to touch upon three points. First, in relation to the expense reduction for this quarter. SG&A was able to absorb the gross margin. I would like you to describe this, talk about this, which was focused on sales expenses, and it's a discretionary line. I would like to understand from your side how this was different, how is this going to be different along the year, that you're going to go back to the levels of last year for the next quarters? Could we understand this to be a recurring level considering the revenues? This is my first question. The second question is that I would like to go back to Asia topic, the question is directed to Patricio. It's not very clear to me. You suggested in your answer that there are some things happening in Japan and in China. I would like to know that this accommodation of margins in Asia that we have seen since last year, they were very high, and they were kept very high, and they started dropping, and they dropped even further. You understand that this can be reverted or do you believe that this cost pressure is going to prevail? I want you to understand how do you see the Asia-related margins for the rest of the year. Lastly, in your release, I had the feeling, correct me if I'm wrong, please, you are much more cautious as I felt it when you talk about macroeconomics in Brazil. At least it seems to be a bit different from the discussions in terms of domestic market when you provided the results of the previous quarter. Sidney has just mentioned that he sees no trade down, he doesn't see many relevant changes, and he sees that there's going to be a growth for processed food. If you could provide some more color on this demand perception and also the macroeconomic situation as compared to last year, which was very atypical in terms of demand in comparison to this year. Thank you. Thank you, Thiago. Let me talk a little bit about the current moment. Today, we need to be cautious. We need to have a very precise management of the actions of the company. You can see it's clear, it's transparent that the costs have increased. The perspectives in terms of agricultural commodities and considering the levels that they are at, and we have to consider the perspectives in relation to prices. We have to be cautious so that we can rebalance the situation in a proper manner. Another factor is that last year we have a perspective that we would start 2021 with the pandemic as a thing of the past. Unfortunately, we lived the first quarter as the worst moment ever for the pandemic. It's expected that we should have this concern, and therefore we are going to do the management in a sustainable and balanced way as we have done so far. As for the long term, it remains. That is, the demand will continue to grow, population will continue to grow. Evermore, all value-added products that would provide convenience to all consumers will continue to grow as well as we have seen so far. This has been mentioned by Sidney. This is something that is going to happen along the year. It's very important to look at the structural situation and consider all the situation of the moment. We are very confident on the perspectives and on the future planning of our industry and of the company. At this time, we have to manage very carefully, very cautiously. I'll turn the floor to Carlos so that he can talk about SG&A. We have the matricial management for our costs. I think Carlos can talk about it, and then we'll turn the floor to Patricio so that he can provide more details about Asia. Thank you, Lorival. It's a pleasure to talk to you, Thiago. This is part of a process that we have here to manage our expenses involving 18 packages. These 18 packages have included all the areas of the company strictly aligned with the purchase areas, even with all the challenges that we have been facing at the macroeconomic level. About 70% of what we have sold in this quarter is caused by economies in facilities, information technology, legal savings, and we had an important action of provisions where we had reduced costs and also indirect people. We have been optimizing our processes, and this 30, 35% will be used according to the moment that we are facing each quarter. We are going to continue doing this thanks to the methodology that we have adopted, and we are going to continue with increasing the maturity level. We are going to capture not only the possibilities of reducing expenses of the company and also we are going to have ever more mature processes as to ensure competitive advantage for our business. Patricio. Thiago, good morning. To reinforce what I've said, I am going to explain what I've said. I see an improvement in prices in Asia. First is related to the price, because the cost would affect everyone. The demand is very high. The third factor is that there is a balance of the inventories, both of exporters and local producers, especially smaller producers, as we can see in the case of Asia, where when there is a pressure of cost and they cannot include this in prices, they face problems. This is something that we have been feeling in the first quarter, and we have been feeling this now, and we understand if there is a perspective of better prices in Asia. This is a fact. Yes. Thank you. Okay. Excellent, Patricio. If I could take advantage and ask another question. This margin in Asia, could you share with us how China and Japan would stand in those numbers that were communicated? China is better than the figures, and Japan lower than the figures. China to increase and Japan in the process of recovery. All the other countries are in the process of recovery. As I explained in the previous question, I cannot specify the margin for the second quarter, but 50% of the period has already been experienced. Okay, excellent. Thank you, Patricio, Carlos, and Lorival. Thank you. We have come to an end with our Q&A session. Mr. Lorival, you may proceed with the final considerations. Thank you, everyone. Unfortunately, we had some technical problems in the translation and our broadcast. Unfortunately, some of you could not hear so clearly. I would like to apologize, that was not the purpose of our company. We are going to provide this available on the website, the recording, without any cuts or without any interruptions that you have experienced. We would like to reinforce the company's commitment to our planning in the future as to sustainability, ESG topics on which we have worked with balance and sustaining our margins and our growth, always working with a cash generation so that we can sustain all the planning and the 2030 Vision as we have presented. Thank you, everyone. Have a good day, everyone. The conference call of BRF is over. We'd like to thank you for taking part in it, and have a good day, everyone.