Good morning. Welcome to the conference call of Fras-le Mobility on the earnings of Q1 2024. Before beginning, we'd like to make some important announcements. This conference call is being recorded and after the end, will be available at our website, ri.fraslemobility.com. We have simultaneous translation in progress for English. Please click on the button Interpretation, with the icon of the globe at the bottom of the screen. At the end of the presentation, we will have a Q&A session, when questions will be made in two ways: by audio, please use Raise Hand, or in writing through the Q&A button. We reinforce that the information supplied in this conference call is not a guarantee of performance. They involve risks and refer to future events, and therefore depend on circumstances that may or may not occur. We thank you for being with us in this earnings call, and we have with us today the Chairman and CEO, Sérgio Carvalho, the CEO, Anderson Pontalti, the Business Director, RI and M&A, Hemerson de Souza, and as a guest, the RI and Finance Director, Esteban Angeletti. Now, I'd like to pass the floor to Anderson, who will begin the presentation. Good morning. Thank you very much, Jessica. It's unavoidable to mention our solidarity to the people in the state of Rio Grande do Sul, affected by the heavy rains, and we know that it will take some time for us to know the magnitude of this. And Sérgio, at the end, will talk more about this in a more detailed way. Two important moments, two important things happened in this month. First, in fact, related to the floods. We had to stop operations in Caxias do Sul for a day and a half, from Thursday, 12:00 A.M. to Friday, but operations are back on Monday. But this does not apply to São Leopoldo, which is a lower area in the state where we have Controil, where we continue closed due to the floods. We had the plant was flooded, and now we are working to help the people who live and work there, and after that, we will recommence operations. We also had a relevant fact, an important decision on the part of the company to close the operations in Fanacif. Fanacif came with the acquisition of Armetal in 2017, when we made this acquisition, and Armetal was the focus, main focus, Fanacif. Due to the high dependence on the Argentinian market and the possibility of allocating this, the production of this plant in other plants, we made this decision. It's not an easy decision, but it was a well-thought decision, and as we see, a correct decision. We decided to close the activities. We made an agreement with all the employees, the employees contributing with reallocation, payments, payments above the normal in that country, but we know that some people will have to be reallocated in the market. And now we accelerate more the production in other plants, in other locations. Please. Another important point, we concluded with great efficiency another transaction, Juratek. So we are always looking at capturing synergies, but we must understand that the strategy of making an acquisition in Europe was very successful, and now, at the end of a year, the results are much better than we expected. A very engaged team in Juratek in the U.K., including, for example, brakes and brake pads with Fras-le brand in the U.K., beginning to create a powerhouse in the U.K., in England. So on February 22, Fras-le celebrated its seventieth birthday, seventieth anniversary. We had the opportunity to celebrate with some clients, employees, and suppliers in these first months of the year. And we also had the AEO certification, Authorized Economic Operator. Nakata already had this, and this was extended to the other brands and operations. This allows us to agilize the import process, so this also helps in lowering working capital and also in delivering to clients. We're very happy with this certification. The highlights, after that, Hemerson will talk about each one. We already know, we already knew that the growth in Q1 would not be very strong in relation to the Q1 last year. We adopted a new SAP system. We are already in the cloud. It was very successful, but also we had clients that had some changes in their branches. We knew that this would result in a lower volume, but we're projecting higher volumes, and so we delivered what we planned. We delivered more to the foreign market. This was a good surprise, a growth of 11% in relation to last year, 11% growth in the foreign market. And in here we see a bit of margin. We projected 17%-21%. We know that Q1 is slower, and we have an EBITDA margin of 18.3%, well within the guidance. And also investments, we are projecting between BRL 130 million and BRL 170 million. We began the quarter with BRL 21 million, and as we have every year, we have an acceleration. So a very positive quarter, with results that show the current situation. In the last few years, resilience, strength, and a lot of optimism in relation to the future. Hemerson, I'd like to pass the floor to you. Thank you, Anderson. Good morning. Thank you for being with us in our earnings call. Anderson already anticipated, in general, we had a stable quarter when we compare this with 2023. Modest growth, 0.3%, total stability. Yes, very in line with the planning that we had. We updated our ERP system, our SAP system. This gave us five days less in the beginning of the year, and also gave us an important support for the future with SAP. But there was an effect to continue the operations without the system. After, we had also a certain delay, but it was very successful. No difficulties after, but there was an impact. Also, we did maintenance. We dedicated ourselves to maintenance during this period when we changed the ERP system. We had an important growth in the domestic market due to gains in business and also units outside Brazil, especially our unit in Alabama, USA, and also in India. New business, both gain new businesses and this... Also, one year of Juratek, and we already have an important synergies with Fras-le Mobility. We were able to reduce costs, also gains in supply chain that gave us economy of scale in Juratek, and we're beginning to launch products with our brand in the UK. With the Fras-le brand, we have brake discs and also blocks and brake pads. We have begun the same. Also, we're programming other initiatives this year to increase the portfolio of Juratek in the UK. And another point, a new government in Argentina, this allows us to reestablish some lines, especially brake discs. The difference between Q4 and Q1 this year, almost 90%, is due to the devaluation of the Argentinian peso with the new government, and this was explained in previous meetings. On the next chart, we talk about our performance in the markets. I'd like to say that we sold 87% of our sales related to aftermarket replacement parts. Here, we show the light line and commercial line. 36% of what we sold in friction was light and 64% commercial. In the domestic market, here we see we had good sales here in brake systems, and also we have been making progress. Also, we'd like to say that we have made progress in heavy brake pads, especially for buses, urban buses; they begin to have more relevance in our share. In the foreign market, I mentioned the gains that we had, especially brake pads for heavy vehicles. We begin to see this product with an important position. And sales, especially in the unit we have in Alabama, USA. In suspension and also steering and powertrain, we were able to make progress, developing a more adequate portfolio in Colombia, and this is showing a lot of progress in volumes. In terms of brakes, we had a linear situation, and we had an important variation in competition, especially in disc brakes, more competition. And revenue is linked to the mix that we have. We also see here in the light line for these segments. In friction, we have a relevant position in the commercial line, especially in North America. On the next chart, let's talk about results that we reached BRL 54 million in EBITDA margin of 18.3%, 13% lower than in the annual comparison. And here we have many factors that we can mention. In general, we had the factors related to revenue that didn't grow, or the way we imagined, due to the points we mentioned here. Also, we've seen a good management of the supply chain. We don't see, we don't see great problems. One or another area has an increase in costs, but we're following what we had planned. Some expenses grew, and although we are not making an adjustment as non-recurring, they can be seen as non-recurring cases. We had BRL 2.4 million linked to M&A initiatives. You know that we have important activities looking for growth in non-organic ways, so we have some expenses linked to M&A and also more accruals, provisions, BRL 10 million, linked to reviews in some court processes. These provisions are for labor court cases. Other revenues, we have the reversal of a payment, almost BRL 10 million, because we use some investments in dollars in Argentina. As I said, we have similar sales, and later, we will see some other variances. If we look at Q4, we have some points, some non-recurring expenses at the end of the year, and also important variances in the Argentinian market, devaluation of the currency in Argentina. On the next chart, we can talk about our financial performance. You can see here that we had a relevant cash flow. A positive variance contributed for this cash flow position, and our cash is very high with investments, and we had some influence here from Argentina. When we look at working capital, you can see that in Q1, we have a significant variance, 8 days less. I understand that we have overcome this. The characteristic of our business, we are connected to the replacement market. We have to have higher levels of inventory to be efficient. It's natural that we don't want to lose sales. Therefore, sometimes we need higher levels of inventory. We don't see this continuing in the future. Although we consider that these days are healthy for our business, we already mentioned here, we invested in the beginning of the year, this amount, and also we made investments in sustainability. Going on to the next chart, let's talk about the company's net profit. We can see the profit here, BRL 109 million in Q1, 20% more in relation to the previous year, and 16% higher than Q4 last year. We have a good cash level, we have investments helping for this, and operations is doing very well. You can see this. We are looking for more synergies to allow us to have good levels of profit. We don't have, we don't have any significant debt. We have loans from IFC, BRL 250 million, and we add amortizations, BRL 55.5 million. Today, in the quarter, we have a good cash position. Next chart, we invite you to come to the site visit. Those who don't know our site in Extrema, in the state of Minas Gerais, it gives support to all of Brazil, with the exception of the south and also Nakata plant. So please come to visit us in 2024. We will be sending you details to, for you to come and visit us. Save the date, June 27th, 2024. So you are invited. Very well. The numbers, the numbers explained. We're available to clarify any points. You have also our material, which gives you more information and details, reconciliations, and other points, such as gross margin. To close the presentation, I'd like to invite Sérgio to talk about business perspectives. We're very optimistic. We're very optimistic. Sérgio, you have the floor. Thank you, Hemerson. Once again, thank you for participating in our earnings call. Anderson already mentioned briefly the situation we're going through in the state of Rio Grande do Sul with the floods. We have a calamity situation never seen before. We had rains in all the states, 340 cities with floods, which led to this disaster, this tragedy we're going through. We have worked in a direct way with all the possible efforts to give support to our employees and the communities where we are present. Thank God, until now, we have no deaths among our employees, but in the states, we have almost 100 deaths due to the floods. In our region, we stopped operations as of Tuesday last week in the third shift, and in Caxias do Sul, on Monday now, we are working normally already. But with the exception of Controil, which is in the city of São Leopoldo, the plant was flooded, 20 centimeters of water in the plant, and yesterday night, for the first time, we were able to access the operation to evaluate the damages. The damages were not high. We don't have supply problems in our region, and we hope that in the next few days, we will be better when we will begin operations once again in Controil, too. In general, in our operations, we're operating normally without logistics problems. We overcame many difficulties, and now we're focusing on planning, on planning... the beginning of our operation in the plant in São Leopoldo for Controil. The market in the state of Rio Grande do Sul represents only 3% of the Brazilian market. So almost everything that is produced here goes to other regions. Distribution is done from Extrema, Minas Gerais, which is very far from the south of Brazil. So the state of Rio Grande do Sul, with the floods, represents 3% of the company's sales. We're focusing on giving support, finding solutions for our employees, and at the same time, we're working strongly to recover the operation of Controil. Now, talking about the outlook, Hemerson mentioned this, our vision is that of moderate optimism. Looking at the domestic market, it continues with positive perspectives. We have garages with good performance, and we see this in a positive way, but we don't see this year as strong as previous years. The situation is still positive on one hand, but not with the same levels we had in the previous years. So this creates more demands on the part of clients in terms of service. More. We see more competition. Argentina continues in a recession, but we can say that there is some progress being made. Inflation is under control. Also, some positive results, and Argentina will have a good harvest, and this will help the recovery process in a market that is very relevant in South America and very important for us. OEMs, both in Brazil and abroad, are very positive with growing production, and in these geographies, we have been able to close new deals, new business in a relevant way, helping our future. That's why we're mentioning that we have a moderate optimism, moderate optimism, and we must understand in more detail the impacts of this catastrophe due to the floods in the state of Rio Grande do Sul. Now, I'd like to pass the floor to Jessica to begin our Q&A session. Thank you, Sérgio. Reminding you to ask questions via audio, please use the icon, Raise Hand. To ask questions in writing, use the icon Q&A. We have our first question, Gabriel Di Pinho, analyst from Bradesco BBI. Good morning. Thank you. Two questions. The first, concerning competition. You mentioned greater competition in disc brakes in the domestic market, so I'd like to understand better what some details about this, and also global competition, competition with Chinese companies. So first question, competition. The second, concerning the tragedy in terms of the floods in the south of Brazil. You mentioned production, which you intend that you have to recover control. I'd like to know how much you have in normal production and how much you have to recover at Controil. And in the future, what do you see as impacts in the supply chain? Because some roads have been blocked. Thank you. Thank you, Gabriel, for the questions. We can, I will begin talking about competition in disc brakes and the increase in competition from Chinese companies. Then Sérgio can talk about the impact of the floods. First, we're always evaluating the competitiveness of our company. It's a journey that never ends. Every single month, we check our position in relation to the competition, and our challenge is to adapt prices and protecting our products. In the case of brake discs. We have a strong production in Brazil. 22% market share in Brazil. In premium products, 35%. We operate in lines. So in general, this explains the success of Fremax in the market, our brand for disc brakes. But there are times when the market has surprises, and we, we notice this when volumes drop. So we make some price adjustments in some lines, in some SKU, some, some of them, we increase the price, others, we drop the price. Thus, adjusting prices where we're losing sales due to competition. And in April, we had a very good performance. We, we went back to higher volumes due to the adjustments we made. I understand that this has been, this is something that is always important. We have, for example, Chinese products in Brazil, some electric vehicles coming to Brazil from China. I'd like to say that China is a large supplier to the Brazilian market. We buy a lot from China. We have partners in China for 15, 20 years, and this isn't going to change the dynamics. We don't see an expansion in the competition from Chinese products in Brazil. Competition always existed, and last year, it came back after the pandemic in geographies like Peru, Colombia, Mexico, where we have sales, and we have to adjust ourselves. But this, and I can tell you that this is not one of the problems that is difficult to manage. We have a lot of local producers, so we are very connected. The exchange rate also does not help those who want to enter the market. So I hope I answered your question. Now, I'll pass the floor to Sérgio and Anderson to talk about the impact due to the floods in the state of Rio Grande do Sul in the south of the country. While I will begin, Sérgio can supplement. The impact is still strong because we are in the first phase of a catastrophe. We are making efforts to feed everyone, take water to everyone. We, we don't have electricity in the region of Controil. And the factory, recently, yesterday, the water went down, and due to safety reasons, we have turned off electricity of the plant. We have 100, 160 employees that have lost their houses. 160 employees that lost their houses, their homes, but we're working. We want our employees to solve their personal problems and be ready to be able to come back to work. We're helping them in all the fronts. We're trying to accelerate the process to supply help to our employees and the communities. It's very difficult to make a forecast of operations coming back. What we are doing, we are working with our sourcing. We are importing to supply what is missing. Also, this market, this state, will not buy, will not consume Fras-le Mobility, especially where we have floods. So it's not only Controil. This affects all the items. There was a great drop in consumption due to the floods, but most of our operations are outside this area. And there, this generates opportunities of our competitors in Rio Grande do Sul will not be able to supply the other states. So the impact will be very small. The impact for us will be very small, with the exception of Controil. So yes, first, we are working to help people, and then we will work on. I'm sure that a week from now, we will know better, but it's very early now to measure the impact on the business. Would you like to add something, Sérgio? Yes, Gabriel, all our distribution, with the exception of the south, is done from the state of Minas Gerais, which is very far from the flood, so our inventory is in the state of Minas Gerais and was not affected. Anderson mentioned in the south, we have two operations. We have friction material in Caxias do Sul, which is already working normally since Monday, and we don't have problems in the supply chains. The city is not isolated. There is a route that is a little longer. Yes, three hours extra, but we have access to receive raw materials and to send products. So in terms of friction material produced in Caxias do Sul, we're back producing. Our concern is with Controil, where we produce cylinders, master cylinders. This is our concern. And it represents 5% of the revenue of Fras-le Mobility. Yes, thank you. Our next question, Gabriel Tinem, analyst from Santander, sell side. Thank you for the opportunity. Two questions. The first is more focused on market share in the domestic market. You mentioned two highlights, one from brake pads for buses and also shock absorbers from Nakata. Can you give us more color about this evolution? And the second point, foreign market. The ADBs in Alabama, and how do you see opportunities, especially in the U.S. market, maybe new engines? What do you see? Thank you, Gabriel. Anderson, the question about the foreign market, you are involved in this. I will begin with market share. In fact, we are gaining market share. When we acquired Nakata, they had 16% of the domestic market. We estimate that last year, at the end of last year, we had 24%-25% market share in the country for Nakata. So we have been working, and we're working to be more relevant. Well, we have done this with profitability. We have a new plant with well-adjusted production, with the economy of scale, using our buying power, together with Randon Corp, in terms of raw materials to produce the shock absorbers. In terms of brake pads for light vehicles, we have expanded our position due to many strategies. One of them is to launch products in a very quick way. For example, for automobiles, in one month, we already have the brake pads. So we have been, we have been working in an efficient way. Now, in the heavy line, we're also leaders in Brazil, a relevant position, but we have made less progress, slower progress. We have been less aggressive in terms of brake pads for heavy vehicles. So we have focused on fleets. We have a very good product, but although this line is still small, less than 5% of all the demand, when we look at replacement for heavy vehicles, we have focused on this to continue growing in this market. And we have worked, making a great effort to sell to bus fleets, we will have good news in the future for you in this area. Now, Anderson can talk about the foreign markets, also in brake pads for heavy lines. Yes, we have a very promising journey ahead of us in the transition of part of the fleet, as you mentioned, original vehicles. Most of the fleet in trucks is now in a transition phase for brake discs, heavy trucks. We are leaders, and we are protecting our main geography. So we've been in this journey for many years, working in all the fronts: product, competitiveness in production, nearshoring, development and certification, and also looking at clients and their demands. So we won business in clients in Mexico for original parts, two important contracts in the U.S. that will begin to give us revenue in 2025, 2026. In our main client, Meritor, we have all the applications of OES and aftermarket, and we have a consistent objective to have one of their brakes, which has the highest volume. This will be in the medium term. We have competition there. In the U.S., we have also gained market share in WABCO, a global partner of ours in Asia. In Europe, those who make axles, axle producers in Europe. So we have a clear objective. By the end of 2027, we want to sell more than two million brake pads to OEM market and OES market. I can tell you that we're well-aligned with this ambition, and we may even overcome these numbers in an easy way. OEMs, it takes years to work with them, but then you will have five to 10 years of supply. We're very happy with the objectives we have reached until now. Very clear. Thank you. Thank you, Gabriel. Our next question is from Fernando Urbano, from XP. Good morning. Thank you. We hope all your employees are well, those affected by the floods. A follow-up question about profitability. In this quarter, we saw a margin within the guidance, but different from what you delivered last year. You mentioned some effects that influenced this deflation in raw materials, repositioning and the stop due to the new ERP system. Can you give us more details about the profit? Which materials were the cause? And I'd like to know how you see prices in the next quarters, raw materials, and maybe a better demand in replacement market. Thank you. Thank you, Fernando. During last year, we were always saying that the results that we reached in some quarters were due to a good combination of operational performance, and also booming demand and efficiency in the supply chain... enabling us to have gains and savings that we did not have during the pandemic. And this happened. The price of commodities dropped a lot. Not only commodities, because 40% of our revenue comes from friction, resins, oil, other ingredients, the prices fell, and this was important in helping us. And we had a booming market, and we were able to have an adequate management of our prices with lower costs. This allowed us to have a good profitability. This scenario is not totally different today. We continue with the efficiency, I call this legacy, and there's another part called opportunity. Opportunity is to see clearly what is happening and also have an adequate have adequate prices, So we have good perspectives for profitability, and this is because we were very efficient in going after new business, new synergies, new productivities, with cost reductions in an efficient way. So the legacy really helped us a lot. Two years ago, we, we had 14% margin. Now we're well over this profit, and we had at certain moments, some margins above 20%. So we're working on these points again, but we have problems with days of production, more provisions, accruals due to potential losses, expenses with M&A. So you will see that with all these facts, our margin is still very sustainable. Today, we have to be looking at the market. So we know that it's important to be connected to the market, because clients today want more services and better payment terms, and this affects prices. But this is not the, even these discounts are not very relevant. We will continue working on production, spending less, producing more, to continue and getting having results from our legacy. So as we said, we're moderately optimistic. Yes, Hemerson, in a nutshell, in terms of operations, we're doing very well. Last year, we had some situations that were very favorable, but structurally, we continue strong. So we, we planned the SAP, the new ERP change. The only thing we didn't have on the radar were some additional points. And even with this, we were able to get good results. There is nothing structural that can affect the company in the future. It's important to highlight that we have accounting consequences due to the closing of Fanacif plant. This will have an effect, and this will be shown during Q2. In our next meeting, we will have details about the closing of the Fanacif plant. Very clear. Thank you. Thank you, Fernando. Our next question is from Gabriel Rezende, sell-side analyst, Itaú BBA. Thank you, Jessica. Good morning, Sérgio, Pontalti, Hemerson. I hope you're all well, your families. Two questions: You talked a lot about revenue in March and for 2024. But bearing in mind Q1, how is the guidance? Is it conservative, optimistic? Please talk about the guidance, growth of top line and margin. What is your opinion about the guidance today? And also, if you could talk more about inventories at clients. You mentioned in the release, this is a variable that can reduce demand, so please talk about inventory at clients. Thank you, Gabriel. I will ask Sérgio to talk about the guidance. He is the chairman, and I will try to answer about inventory levels at clients. Concerning inventory levels at clients, we noticed some points. Anderson mentioned something very important. And some companies bought less in the beginning of the year. In April, this went back to normal, and in some lines, due to the sellout, we follow the sales of our main clients, so there was a lot of demand. They sold very well. Our clients sold very well. So, no special, we can talk about disc brakes and some suspension lines. We noticed that inventory was a little higher. So when you lose sales, when some clients lose sales, these sales are lost. Today, sellout is very good. Inventory is at a good level. We're working with our clients. And it's up to us to supply the adequate service to them. We're very focused on the use of working capital. But we're being able to sell, and sometimes we're not being able to replenish the inventories. Unfortunately, Controil, for example, has a lot of orders to deliver, and we want to supply the market. So we're always looking at this. These problems are over, and now I'd like to ask Sérgio to talk about our guidance, his opinion today. Gabriel, thank you for the question. I believe I can mention that we continue trusting the guidance that we gave for this year. We had foreseen, Anderson touched upon this, a slower, a more timid beginning in Q1 due to the new ERP. Our markets in Q2, Q3, they have a better performance every year, so we continue with these margins. Although we had a more timid margins, the margins are still good, and we trust that we will operate within the guidance. Of course, we have this need to reevaluate in one or two weeks when we will have a better understanding of the impact of the floods. But as we said, the market in the state represents 3% of replacement markets. So as soon as control is back, we will have a better idea. Anderson mentioned the impact of Fanacif. This is very important for us. There will be an impact from the closing of the plant of Fanacif. But in terms of operations, we still trust, and we believe we will have a very good year according to our guidance. Thank you. Gabriel, just a supplement. Anderson mentioned, Sergio, too, the decision we made to close the Fanacif plant. This is because of the market situation in Argentina. It's a very old plant, Fanacif, a plant that would need a lot of investments, and therefore, we made this difficult decision to close this plant, Fanacif, and we will be able to leverage the use of our assets elsewhere. And obviously, we will be looking at the impacts of this in Q2, Q3. As Sérgio mentioned, we're still moderately optimistic. Thank you. Thank you. Very clear. Thank you, Gabriel. Now, the last question, in writing, Rubens Machado, an investor, he mentions our Free Float below 15% if we look at the shares with the controller. And he asks whether there is any discussion about issuing new shares or sale of, sale of shares by the controller. Thank you, Rubens. We have answered this question already in other forums. We know the quality of our business. We trust in what we can do through our operations and where we can get. So this has resulted in the value of our shares and the consistent delivery of results. Yes, we have always been transparent with the market. We are after accelerated growth, adequate margins, and we're very diligent in allocating our capital. For example, we have an excellent cash position, and there is the possibility of M&A, and therefore, we understand that liquidity is a point to be worked on and solved. We have had many conversations with analysts, and this includes the controlling group, to work on this, a better offer of shares. I can tell you that all the parties know about this, and I understand in the future, there will be the possibility of improving this. There are many things to be built together with the shareholders, and for the time, we have to wait, but I can tell you that we're always working on this. We have an active agenda. Sérgio, Anderson, and myself are always working on this, because we know the quality of our business, and this, we know that this should be reflected in our shares. For we're using our resources, the loans we took out in 2022, we are. We're evaluating things in terms of M&A, but M&A is always a surprise. And as we use the resources, we will go to the market through equity, where we can obtain necessary loans. But I say, this is something we're always working on, something that is always present, and I hope we can solve this in an efficient way and fast way. Thank you. We'd like to thank all the participants. We'd like to close the Q&A session, and now I'd like to pass the floor to Sérgio for his final comments. Thank you, Jessica. Once again, I'd like to thank all the participants. We're always available for further clarifications, myself, Hemerson, Anderson, Jessica, and the team. Feel free to talk to us if you need more clarification, call us, and we will see you, we will meet again in the next event. We wish you a good afternoon.