Morning, everyone, and thank you for waiting. Welcome to the earnings call for the second quarter of 2026 at Grupo Mateus. For those of you who need simultaneous translation, please select the interpretation button through the globe icon at the bottom part of your screen. Choose your language of preference, Portuguese or English. For those listening to the earnings call in English, the mute original audio option is available. We would like to let you know that this earnings call is being recorded and will be provided on the company's IR website, where we also have the full earnings call material. It is possible to download the presentation as well on the chat icon in English. During the company's presentation, all participants will have their mics off. Soon after, we will begin the Q&A session. To submit a question, select the Q&A icon at the bottom part of your screen. Write your question to enter the queue. As you are announced, a request to open up your mic will appear on the screen, then you must activate your mic to submit a question. We would like to instruct you that you submit all your questions at once. The information contained in this presentation and possible future statements that could be made during the earnings call, considering business perspectives, forecasts, and operational and financial targets at Grupo Mateus, represent the assumptions and beliefs of the company's management as well as information that is currently available. Future statements are not a guarantee of performance. They involve risks, uncertainties, and assumptions as they refer to future events, and thus depend on circumstances that may or not occur. Investors must comprehend that economic, general conditions in the market, and other operational factors may affect the Grupo Mateus performance and lead to results that differ materially from those future statements. Today, we have the presence of the company's executives, Mr. Ilson Mateus, the Founder and Chair of the Board, Jesuíno Martins, the CEO, Tulio Queiroz, our VP and Investor Relations Director, and Sandro Oliveira, the VP in Operations, Logistics, and Commercial rep. Now we are going to pass the phone to Mr. Ilson Mateus. Good morning, everyone. Welcome to another earnings call. First of all, I want to once again start off by thanking God for allowing us to be here today, this morning. I also would like to thank my dear friend, Jesuíno Martins, Sandro Oliveira, and Tulio Queiroz, as well as all of our directors and the almost 70,000 employees, suppliers, and investors. It is a pleasure to be with you this morning. Now we will move on to slide two and start off with our earnings call. I wanted to start off by saying that we are celebrating our 40th anniversary, and ever since the beginning, we always look to the future. We invested in logistics that would be strong and efficient. When we observed these trends, we set up our first cash and carry back in 2007. We saw this was an important trend and that this business would be prosperous. Then, as I have already mentioned in previous sessions, we saw this business model was really fitting in with the reality we had in retail and our wholesale distribution operation. So it was 40 years of major struggles, lessons learned, and especially in the last six years when we went public. After the IPO, we entered six new states and five new business channels, but we always wanted to make sure they would fit into our pillars that are the main pillars, which are logistics, and also observing the potential that these business channels have and these states. If they would fit into our main business, which is logistics. This is an important margin of about 200% and about 30,000 jobs generated. For us, this was a big challenge. It has been a long journey of maturing. However, we are structuring our teams and we are really focused on improving processes and especially governance. We have been making major efforts for this and we have brought these different topics that are extremely important and we really learned a lot in this process, of what should be done and what should not be done and that is how we can learn. We are not only thinking about today, but really putting into practice everything we have learned these last few years and looking forward to the next 40 years. That is where we are headed. With all of these lessons learned, we know where we are headed. When I think about the future and the sustainable expansion, I think about logistics, and we are working hard to evolve even more in this important pillar which is our backbone here in the business. This was really important in the past, and it is important in the present, and it will be even more important as well in the future. All of these different initiatives, we are looking forward. We need to consider what is happening with these new opportunities. These are always connected to logistics. To celebrate the 40 years that we are achieving, this month we have a major initiative here. These are special deals for our customers at Grupo Mateus and Novo Atacarejo. We are going to show you this new slide. Túlio will talk about this up ahead, but we will start improving this partnership and with what we most expected. Synergies start happening. We also had this important movement to improve processes. We also have the Novo Atacarejo team doing great work. Congratulations to their CEO, Victor and Daniel. We had meetings in São Paulo that were really important, talking to suppliers, speaking about our business, bringing volume to always improve our business. Moving to slide four, now we are going to talk about expansion. We had seven stores that we opened, and an important highlight was this new store format. We opened up our first drugstore in June, and the store has been a real success. I have really received a lot of compliments, and so I want to thank the team for doing excellent work. We have been also working, and we are working for the new stores as well. We are already the drugstore with the highest revenue per unit. No other channel has this achievement. I think this is going to be really important now and in the future. We also opened up a great store. We are being a lot more selective, looking into what is going to happen in each region and really making sure it would be a store that could really make a difference. Two stores in São Luís, one in Imperatriz, and two from Novo Atacarejo. Here you can see our current scenario, 234 stores. Now with our new channel, our drugstore channel, which you are already seeing there as well. I want to say that now we will also be investing in a very prudent manner in this channel, and we want to advance with it as well. Moving on to slide six, and to wrap up, we are going to finish it. We opened a store in Pará, in Cametá. This was a big surprise, and we were in a region with strong commerce, but with major logistical challenges that we have already learned about throughout these years, how to handle these difficulties in Pará, Maranhão, Piauí, and this has been a big challenge. We have really learned a lot. Today we work with all of the Cametá region and other regions that are also serviced with our external sales operations. Pará has a lot of islands, so if you go to Santarém, Itaituba, these are regions where the logistics are very challenging to reach these islands. We have been working a lot with our distribution wholesale operation there, and these are challenges, and each of these challenges, also with each of these challenges, we bring an important learning curve. After everything we have experienced in the last six years, we are a lot more mature when we choose new stores, and we also understand the details and barriers, as well as the profitability of each business channel in each state. Just in retrospect, in the last six years, we entered different states, and each state already has their specificities. But within the state, if you look at this per region, there are regions that differ a lot from one to another. We see how this fits in. We have these different brands, and we know where we have the biggest opportunities for each of these, and each business channel, and, of course, always one business fitting in with this backbone, which is logistics. We plan to reap the fruits of this from now on. That is why we have six construction projects underway. We are really focused on the opportunities and looking at the CapEx and tiers for each of these new stores, because we need to look forward with interest this high, and this return rate needs to be closely looked at. We have been looking at each piece of land, real deep research, and with this, we have been able to be a lot more comfortable as well to conduct our business. Now we want to pass it on to my friend, Jesuíno Martins. Okay. Thank you. Hi, Ilson Mateus, Tulio, and Sandro, and everyone watching us. Now I am going to quickly share with you guys some indicators of this second quarter of 2026. We can see our gross profit, and we reached BRL 11.2 billion. This is an important increment compared to the first quarter of 2026, at least BRL 500 million more in sales. That helped a lot. A little below, you can see this increment of BRL 1.3 billion if you compare with the same period last year, and a growth of 12.9%. In the bottom part of the first block, we also see our gross revenue, with BRL 21.9 billion and an increment of over BRL 2 billion in this semester. It's a quarter that is very challenging, and we see important evolution. We're going to share some of this during the call. On the second block, we can also see our same-store performance. On the upper part, we can see the performance in the quarter, and then we're at a level of about minus 8% same stores. At the bottom part, we can see the performance of the same stores in the semester, - 7.7% growth. Here we can also share some relevant points about the Brazilian Northeast region, and we can also notice Mateus, the Mateus brand, having important evolution in the same store. Novo Atacarejo was also at different moments increasing this same-store deficiency, and with this, we can also reach this level of -8%. It's important to highlight that in this quarter, we also see an important behavior in Brazil, all over Brazil. If we look at cash and carry exclusively, we can notice that the whole country is dropping when it comes to same-store sales. Brazil, the Northeast, of course in the Northeast, it's a little more acute than the average in Brazil. At least two percentage points higher than Brazil. Of course, Mateus is amidst all of this. If we look at states like Minas Gerais, Espírito Santo, Rio de Janeiro, São Paulo, interior, the Midwest, all of them have a drop in same stores in this period, with the exception of the Rio metropolitan region, with an important growth of 3.7%. We notice a national behavior when it comes to this growth of same store. We also see an important slowdown. We also have a slowdown that's in volume in Brazil. In the same period, there was a growth of about 3 percentage points in volume. In this quarter, the volume sold also drops, and in the Northeast, they were also growing 2.4%, and now that's dropping volume as well. If we look at this, there's a significant slowdown also from a revenue perspective last year compared to what NielsenIQ was auditing, which is modern retail as well, and this channel was growing 11% in Brazil. When we look at the same period this year, it only grows about 1%. If you look at the Northeast, the total revenue, which was about 10% more. In this quarter, it's going to be 0.9. We can see this slowdown that's very significant in the same-store growth and also in the volume sold and in the total revenue in Brazil and in the Northeast. Once again, in the Northeast, in some of these indexes, it's a little more acute. If you look at the baskets audited by NielsenIQ in the Northeast in this quarter, at least 50% of the baskets had a drop in volume. This is a different scenario than what we've seen throughout these years. All of this is happening because we are in this environment that we are all aware of, with high interest rates, debt interest, and inflation. I don't think I need to talk about this now too much because everyone's aware of what's going on and the levels of interest. In the past, it was about 70%. The last readings represent almost 2% of debt. It's a scenario and an environment that is really challenging. We also notice that in line with this, you have a more intense impact on this drop when you look at consumers with lower income. They feel this a lot more. Besides this lower income customer feeling this a little bit more, we also notice that the channels that rely on these lower income consumers also feel these drops a lot more that we're mentioning. An example of this is for grocery, which is an important channel in the Northeast in Brazil. They're dropping more than 6 percentage points in this quarter. We know about the importance grocery stores also represent for us. At GMAT3, we service about 50,000 POSs every month, and this channel is also inserted in this context as one of the channels that most feels this. In the Northeast, of course, we rely more on this audience and, of course, we will feel this just as the rest of the country is. Besides this, we also notice an important slowdown or deflation in food, especially commodities. I wanted to share a different scenario. You have categories where we see these rates dropping, where you have a drop in value, volume, price, and these three main indexes drop. If you look at coffee, it's included. Milk powder as well, rice, where there's a significant drop. Powdered soap, sugar, flour. These are all categories that are very relevant. When you see them, you have a drop in the value sold, volume sold, and price. Now, there's some other categories that are growing, but of course, they're less relevant, such as power drinks that are growing a lot, liquid soap, et cetera, but they don't offset this drop. Anyways, besides all of this, we know about the strategic movement that we've had throughout the last few months. We know about the significance of the sale, the weight of telesales, and we've also had a planned and strategic movement that we consider to be intelligent as well. This was a sale where all of the scenarios started really destroying value for the company because more and more, we had to force prices downwards. Volumes were not coming, and that ended up generating competition among ourselves. It wasn't healthy anymore. We adopted this strategy and this scenario of holding this channel a bit. Of course, when we held this, then the share was affected by this, and at least 85% of this drop in sales comes from this counter-channel that we held. Despite this macro scenario we're experiencing, this has a very significant impact in our performance of the same-store sales. Now, we also have an important share in the Northeast in Brazil. We know that in the mid and long term, this is going to be extremely positive for us. We already see signs of improvement in this sense in this quarter now, and we are going to continue to find this optimal point between sales and margins. This is a little bit of the scenario. Just wanted to share this with you and also tell you a little bit of what we have seen on our side, right? When we look at the third quarter, just to give you a bit of this perspective, it is still challenging, right? But of course, there is an important improvement in this sense. It is still quite early, but we are in the middle of the third quarter. It is also worth to share with you that we have already noticed this important improvement. The third quarter last year had same-store growth that was smaller than the last quarters, and of course, that helps in the third quarter. That could improve a lot more, right? The counter volumes. This strategy can be more balanced. As I mentioned, the third quarter, we also have our anniversary with significant seasonality. We are really excited about this. Mr. Ilson also shared a bit of the strategy. We continue, Tulio, Mr. Ilson and Sandro, to adjust the company to this new reality that we are experiencing. In the third column, we wanted to share our gross margin. We know our focus is in the EBITDA margin, but we wanted to highlight the resilience behind the gross margin due to all of the dedication from our commercial team, the trading team, especially significant evolution from our two brands, right? Grupo Mateus and Mateus, as well as Novo Atacarejo. If we look at our gross margin in the third quarter and the first quarter, we already see significant evolution. Novo Mateus has a lot more evolution, of course, from the first to the second quarter. Both brands contribute a lot, and we reach this level of 23.5% of gross margin. It is a significant evolution. Tulio, Sandro, Mr. Ilson, in regards to the first quarter of 2026, at least 0.6 percentage points more, and we are really happy with this. In the bottom part, we also see the evolution of the gross margin in the semester, 23.2%, compared to the same period last year, and we drop in our same-stores. But even so, we are able to keep the significant resilience in the gross margin. In the third block at the bottom part, a little bit lower, I wanted to share how happy I am also about our operational expenses. We have been sharing our main focus. Every Friday, we have meetings to talk about this, at least four-hour meetings on Fridays with all of our leadership team. It is great to see that we have achieved one percentage point less than the first quarter. These two indicators, no doubt, improving margins and everything else we discussed, and the performance also of operational expenses and everything really contributes to this EBITDA that we are sharing with you. You can see on the fourth column from the left to the right. We deliver an EBITDA margin of 6.9%. I also want to highlight important evolution of 1.2 or 1.1 percentage point in regards to the first quarter this year, and we are really happy about this. At the bottom part, we have our EBITDA margin of 6.4%. We delivered EBITDA margin, and this is our main focus again. We are always trying to balance this, sales and gross margins, and trying to deliver an EBITDA margin that really has the highest quality possible. We deliver EBITDA margin, we deliver a gross profit as well that is more resilient, more significant, even in this scenario with a drop in same-store sales, and we know how challenging this is. All of the variables that are in our control, we have been trying to work on here, keeping strong expense control discipline with our gross margin, CapEx, and everything that we can control. Of course, the macro scenario is something we cannot control. However, once again, we believe that we will start to see signs of an improvement in this scenario now with the third quarter. Finally, in the last block, from left to right, we can see our net income, and that is where we delivered BRL 237 million of net income. I want to highlight the important evolution we have had in regards to the net income we delivered in the first quarter this year, at least 11% more. In the bottom part, you can see our net income of BRL 449 million, about BRL 450 million in this semester. So we continue to keep moving in this direction. Our focus is really to improve more and more of our sales and keep discipline in these indicators that we shared. Well, I think that is it. Now we will move on to Tulio as he shares a bit more of the financial data, and then we will head to the Q&A. Thank you all so much for now. Thanks, Jesuíno. Good morning, everyone. Good morning, Mr. Mateus and Sandro. Now we are heading to slide number 11, and we can see the numbers related to our top line and sales in the company. I am not going to extend this too much here. I think Jesuíno brought a real complete analysis on the sales performance, but we just observed that in the semester, we had BRL 19 billion, so there is a growth of 12.5%. Also the pressure store to store, which brings a challenge when it comes to operational deleveraging. It is not simple to handle intensity store to store with this kind of magnitude, which is why it is so important to have consistency in the gross margin, working with productivity and so on. Moving on to slide 12, we can see the numbers that are a little more detailed, and we talk about the performance of our gross margin. So here it is important to highlight that you can see the resilience of our gross margin in the sequence. This quarter also had significant recovery in the gross margin with Novo Atacarejo. We left the 17.9% in the first quarter to 20.2%, and you can see this in the light blue line. But if we were to observe the sequence with Novo Atacarejo and GMAT in regards to the fourth quarter, we can also see that the intensity in this evolution is quite similar. When GMAT's on the black line and it goes to 24.5 and Novo goes from 19.3 and goes to 20.2, both evolve 0.9 and both have a strategy, of course, with different intensities, but this rationale Jesuíno shared about rationalizing the balcão operation, the counter sales. Novo brings this more recent upgrade in this information and approach. Here you can see this axis for the gross margin. There's going to be a seasonality factor quarter-over-quarter, but this is really important and very much consolidated. When you look at this at the quarter, gross profit reached BRL 4.46 billion, and that's a growth of 13.1%. We end the quarter with a gross margin of 23.2. We can see the operational expenses as well on slide number 13, and this is a point that the company has been working on in the last quarters. This quarter, I think, really brings more visibility on this topic so the company can capture 1 percentage point on net revenue. Of course, we know that when we look at the peer numbers of expenses upon net revenue and this component of this evolution in the same-store sales. We wanted to really resume our sales pace with the quality of the EBITDA and the gross margin. I think that through productivity gains, this was actually something that we designed and now we're just working on maintaining, and we really need to focus on these two top-line elements. If we recover sales with healthy gross margins, naturally this value will fit in and the effects will have significant intensity. This is the guidance. When you consider the accumulated results in the semester, we have growth of 23%. It goes to 1,618 with seven new stores at the base. Even in this scenario, we evolve with the amount of expenses that are lower in this sequence, and that makes us really excited for the second semester. As we know, we're on this ramp-up of a gradual recovery in this intensity of sales, right? Now, slide number 14, we can see the numbers related to EBITDA, and here you can see that the EBITDA in the second quarter added up to BRL 682 million. Here, I also have a disclaimer, right, showing you what the number would be like excluding the non-recurring effect, and we had a revision, and we rectified this, and that led to payable taxes. This is a non-recurring effect. If we excluded this effect, it would be about BRL 617 million at EBITDA in the quarter and a margin of 7.3. But I think it's really important to observe the sequence quarter-over-quarter and understanding what's behind all of this. When we look at this, we had this evolution of 1.1 point in the sequence of EBITDA margins, and that really makes us confident about the next semester, as I mentioned. It's not simple to manage this pressure store by store and still expand the EBITDA margin. But when you look ahead, the sales environment's going to improve, and so we know about the potential that we have to bring this EBITDA margin. Now, GMAT evolved 0.5. Novo evolved more. We had a quarter that was under pressure. The improvement in the gross margin was really impacted, and the consequence of this is an important improvement, right? When you look at post-IFRS, it evolved 1.1. Pre-IFRS, the intensity is exactly the same. We can really fit this in well, looking at this operational reality from now on, right? Moving on to slide number 15, we have the numbers related to the. We have the same rationale, and if we were to exclude these, it would be BRL 0.60. But once again, all of the EBITDA work is contributing as well. From now on, of course, in this quarter, we have already had an effective rate in this sense, and in the first quarter it was like a one-off effect. But now we get into a more natural path with income tax, right, in this sense. But even so, the level of net income performed at a sequential level. We went from the BRL 213 million in the first quarter, and we reached BRL 237 million or BRL 260 million, depending on the criteria used. In the accumulated numbers for the year, the company adds up to BRL 450 million. As Jesuíno mentioned, the main guidance is on the company's EBITDA, and we know that if we can address this EBITDA margin, we will be able to reflect this into the other indicators that the company has, right? Either in regards to our earnings, but also our cash, as we will discuss in the next slide. On slide 16, we start talking about our cash cycle, and the company ended the quarter with 42 days cash cycle, which, and here you have an important point. We left 57 days, and we moved to 42 days, and that reflects the work we have been doing on this topic in the last few years. This quarter, we will see in the stock days, it increases from 60 to 67. There is a real seasonal factor related to the group's anniversary this year. Last year, if we were to see in the next slide, net debt is, the intensity is really similar. There is this seasonal component, and we are really confident that these numbers will get back to the levels we need them to be at, right? Just as we see the curve last year, you can see it went from 57, then 41, 47, and now we are already operating at a quality level that is a lot better. But this component is really the component we are working on to acquire in the next quarters. On the next slide, you can see that this cash effect is a little more clear when you see all of the net debt mechanisms, and here increased to BRL 357 million from one quarter to another. This happened in the same way last year, right? BRL 474 million, right? This cash pressure due to the seasonality, which is something I just mentioned, and I remember that in the second quarter last year at the earnings call, we explained this pressure. At that moment, we had migrated from a pressure that had happened from the third to the second quarter, and we explained that this would happen in the second quarter, right, from now on. That is what happened in GMAT. Novo had an anticipation of receivables, about BRL 360 million, and that was the same case there. Mr. Ilson also explained in the beginning of the earnings call that we are experiencing the same moment. We can see that in the first quarter, we had the operation and incorporation of the companies, merging brands, and quality of the stocks. We saw a breakage level with Novo that was really high, so we had a recomposition of the stock quality. For both brands, we expect that the seasonality will contribute positively in the third and fourth quarters. I think this is something we need to keep an eye on closely. It is a topic that is included in all of the company's executives' incentives. This is a topic that we will be closely watching throughout this second semester. On the next slides, number 18, here you have a really important topic. Ilson mentioned this in his opening speech. We can observe the total CapEx in the quarter with a reduction of 36%. If we were to consider the purchase and sale of assets, this is going to be even greater, 45%. The fact is the company is really focused, as Mr. Ilson mentioned, on ensuring the quality of our capital allocation, being very diligent in how we choose new stores. We are very strict in our criteria. More and more we can expect behaviors in this sense, naturally, as we have seen in the second quarter, because we cannot play around when we have high interest scenarios, right? We must be very careful in capital allocating. Mr. Ilson also mentioned that we have a big focus on logistics next year. Here we are going to continue to be very diligent with this. Of course, this is going to help our free cash flow, no doubt. The company has been working on strong expansion levels. CapEx is always a very relevant number. Now we are going to be definitely having a positive effect in our cash flow, right? These are our initial comments. Now we are going to start heading on to the Q&A with our full team available to answer. Thank you very much. Now we will begin our Q&A session. I would like to remind you that if you have any questions, you must select the Q&A icon at the bottom part of your screen. Write your question to enter the queue. We would ask you to please submit your questions all at once. We are going to head to our first question from Rodrigo Gastim, an analyst at Itaú BBA. Rodrigo, you may proceed. Good morning, guys. I have two questions here. The first one is about the sales dynamic now throughout the beginning of the third quarter, as you mentioned in your presentation. I wanted to understand a little more detail of where you see this improvement. We have seen Ilson's data, Jesuíno, and as you have mentioned during the presentation. It is an important dynamic. If you could share a little more about this perception, that would be really good. Then the second point is if you could double-click on working capital, especially stock, as you mentioned during the presentation, and maybe a little more detail if there was something specifically related to Novo, a bit of your perspectives on improving your dropping stock, and how much of this really depends on an upside in your base case sales. If you could talk about the details here of the stock. Well, thank you, Gastim, for the question. I am going to start off answering the first one. We know that 85% of these points on sales have been due to these strategic decisions we have taken on, right? Here, Gastim, you can see this recovery slowly but surely on the volumes. We know about how important this channel is to us, and we're trying to balance it out slowly but surely. We believe that in the mid to long term, this will be adjusted, right? What we're experiencing now is already the beginning of this process. Here, this is one of the main factors that will contribute to this evolution that we've been seeing. As I've mentioned also, in the third quarter last year, the growth of same-store sales was already a little more modest. That contributes, of course, but we have an important anniversary month. We had a very strategic dynamic as well, and we expect to have a special anniversary. We're involving the telesales team as well. The macro scenario hasn't changed, right? It's the same, and we're trying to do what is in our hands right now, of course, trying to keep up a balance between margins and sales. That's kind of a bit of the fact, right? In regards to stock, Tulio, do you want to answer this one? Yeah. Thank you, Rodrigo Gastim, for the question. On the working capital topic, especially stock pressure, I think there's two important components, right? The first one is the seasonal factor, as I mentioned in the presentation. I think last year when we observed the second quarter, we consumed BRL 474 million in cash, and this year we're consuming BRL 357 million. We have a slight improvement of over BRL 100 million in the sequence year over year. Of course, the seasonality exists, especially because of this topic. We want to bring the supplier days to the stock days. The more we can bring these elements close, we'll be able to experience these seasonality dates with less impact and less cash consumption, right? We've really been focusing on the bases and the foundations in this negotiation with suppliers and conversations, and really in this approach to bring the numbers closer until we reach the moment we would like to reach, where the numbers of suppliers can really match the stock days, right? Because then you have these seasonality moments that are going to be a lot more stable when it comes to cash consumption. All of our efforts are in this direction. Meanwhile, these seasonal effects, we're experiencing this topic. Just as we had last year, we're very convinced about this. Working capital will get back gradually. Cash will come back gradually throughout the quarters. Our understanding is that the curve will be very similar to the curve gets back to normality scenario. We close the year demonstrating the evolution year over year, and the days of this cash conversion cycle, right? Every year, we take on an important step to improve this cash conversion cycle. With Novo Atacarejo, an important point here, we have significant consumption there considering the levels of stock, and then we have two components, one seasonal component with the anniversary, and another specific component with merging the businesses, right? As you saw, we had the results of the first quarter. It was a lot more dedicated with adjustments there, operationally merging brands, discussing stock mix. There were a series of operational elements to be able to put this in order, and our stock had a level of rupture that was really high. Investments in stock in the second quarter was stronger. We had a series of conversations with the Novo team, and they were also very much convinced that this would be a curve that is very similar to GMAT's. Considering the anniversary and all of this, then the fourth quarter, it would remain. Novo also has historically had numbers that are very good, and we are sure that the execution will take place in this direction. On a working capital, the pressure is pretty much this, right? We eliminate the seasonality effects, and we want to improve cash conversion cycle numbers. Last year was a super important year, significant evolution. This year, it shouldn't be very different. We closed with about 43 days, and now our most challenging cycle is 42 days. I think the most difficult peak is going to be at the end of last year, and this is a number that we are really focused on with this topic. As I mentioned also, everyone sees this direct impact, and you have these variable compensation indicators as well. We are really confident about this topic from now on, right? Reinforcing a bit of what you are mentioning, with the plan we had for the anniversary, we gathered all of our commercial team and we structured everything because we have this strong history of sales, and if we didn't buy enough for each category, we would have another issue, which is losing sales, right? We are always trying to find this balance point, right? Of course, the team is quite mature, and we are very conscious of everything. We are really working on scheduling everything that is needed. If we keep up working on this, I believe we will continue to be able to handle this stock excessiveness, and that is still a point we must be careful in regards to burning cash and losing sales, right? Excellent, guys. Very clear. Thanks for the answers. Our next question is from João Soares at Citi. João, you may proceed. Hi, guys. Good morning, everyone. I have one question here. First of all, congratulations on the work adjusting expenses and improving gross margins. I wanted to hear about this dynamic with the mergers with the JV for the Novo brand. You even talk about opportunities for synergies, adding on efficiencies and all of this. When we think about incremental gains, we have already seen some adjustments in the headcount and payroll, et cetera. I think these synergies will also bring in additional wins, right? Could you talk about a level of these opportunities or maybe even an ambition of the EBITDA margins when these volumes normalize amidst the structure you have, what kind of levels would we expect for the business, together with Novo as well, of course? Thank you, guys. Well, João, this is a very important question, and thank you for that, because it is a very strategic movement we had there in those three states. Here, we have already gone past the most acute phase. Now we are a company that has merged all areas, and now what we have noticed is a very important evolution in the third quarter. First, we see same-store evolution. It is still really early, though, of course, to understand this, but we are already evolving significantly. Now, more and more, we would like to evolve with this. You can see from the first to the second quarter, more than 2 percentage points of the gross margin, and that is due to this work done merging our efforts. We just spent 15 days in São Paulo negotiating with the main companies, with our team, and it is a real important evolution in gross margin. You see significant evolution also in expense efficiency of about 0.70. We can see EBITDA margin. We want to continue to evolve, and we know that this level can and should have a better quality. We go from a loss of net income. We see important signs when we look at the first and move to the second, and we know that we need to evolve more. Our whole team is focused there. We have the company, Daniel and Victor, and we are just merging our brands and our system. All of the acute work has been done already. I did not want to set any numbers with you yet, but I think it is worth sharing that our expectations are to continue to evolve in these indicators, as we have seen from the first to the second quarter. This is a topic that is really being discussed now, and we are looking at it, and there is a lot of different initiatives being worked on, and we are really keeping our eyes open, right? Because this is where you have to search for things slowly but surely and bring this into the final results, right? Each life here can really add a lot of value. Excellent. Thank you, Mr. Ilson, Jesuíno I just remembered another very specific thing, which is in regards to taxes and the rate. The rate this quarter really called my attention. I think it is worth mentioning the accounting rates and the cash rates and how we should imagine this structurally. That would be really great. Thank you. Thank you, João, for your question. That is very important. Income tax rates have been discussed, and we have been working on this for the past years, actually. We have always tried to have this level of efficiency, working on subvention topics. This was broadly discussed, and especially at the end of 2023 and throughout 2024 and 2025. We have brought this interest on equity and capital and the issues with ICMS, et cetera, PIS/COFINS. I think in the second quarter, differently than what happened in the first one, we start getting into a more stable level, and the second semester, we should perform with an effective rate that I believe is about 15% on average. We get back to this normality. When you look at subvention with Novo, the intensity of the subvention is a little bit smaller. But when you look at this, we share the full disclaimer. But when you look at all of this, you can see this number as well. I think this is a topic that we need to consider. We have a tax committee that continues to be really active, and they have been working on all of the tax reform issues, and it is a long-term topic, of course. What we see in the second quarter is an important step, with positive taxes. Ahead, we can also see this normality of the effective income tax between 15% and 18%. Excellent. Thank you so much. Our next question is from Gustavo. He is an analyst at Bradesco. Gustavo, you may proceed. Hi. Good morning, guys. Thanks for this. I have two points. First, I wanted to talk about the dynamic with the revenue and break down the performance per channel. I understand that the adjustments of counter sales may impact this. If you could break this down with the differences between channels and even distribution, wholesale, et cetera. The second point, when you see volumes dropping, I wanted to understand how you consider this balance between the margin and sales. What levers can be implemented. Maybe product mix changes, assortment. You guys had mentioned that tests were being made to test demand elasticity to consider the perception and see if it is really pressured, if there is space to reinvest in margins and maybe capture a little more volume. Well, Gustavo, in regards to the dynamics between channels, all of them go through the same environment and scenario that we shared with you. Of course, cash and carry will feel this a little more. But as well as our distribution as well, that helps a lot with the dynamic. But overall, it is a very similar scenario among channels. For cash and carry especially, we are forcing this dynamic a little bit with telesales, so it should be responsible for a little more than this. We believe in this. It is still kind of early, but overall, there is not much of a difference, Gustavo. I would say cash and carry would probably feel this a little more, and the indirect channel maybe helps a little more. But it is very similar between channels. Then in regards to your second question, Tulio, Sandro, I do not know. I was not able to hear all of the question with the balance between margin and sales, but do you want to help answer this one? Yeah. Well, Gustavo, thank you so much for your question. Just to add on here, I think when we look at the margins, we were able to keep the stability in the gross margins, and we always try to keep store to store in this scenario a little upwards. This stimulating the promotions. But once again, we see consumers coming with a real tight budget and the elasticity when you deliver margins, they are really tight. I think from now on, as we have mentioned, we are really focused on this EBITDA margin profitability, and we know that we have significant resilience also in gross margins. I think the commercial area is really involved in this, discussions with suppliers when it comes to pricing, and I think we have a real mature mechanism at this point in time. Of course, keeping better results as well in profitability of the EBITDA margins, and I think the gross margin really found this. So when we see the sales, as Jesuíno mentioned, gradually improving, maybe the worst moment of the pressure store to store negative has been left at this level. We came from two semesters that are really intense. Then now it is kind of, as we have mentioned, in retail, there is no way out. It's just like you have to look at day-to-day operations, understand how stores react, how channels react, and of course, fitting in the plus and minus into this macro guidance and scenario, right? We have to improve our EBITDA performance, right? We're really focused on this and looking at, of course, all of the cash scenario as we mentioned, right? Being very diligent in our capital allocation, cash conversion cycles, go through the seasonality of course, and then they recover on the third and fourth and the CapEx also at another level because of this greater focus on capital allocation. I think the combination of these elements should lead to significant consistency from now on, right? Just another observation on Gustavo's question. When you consider this revenue per channel, and we talk about the specificities we're learning about, right? When you look at the Spazio channel, that's teaching us so much when it comes to product mix and margin improvements, right? Then you can look at the structure we created for logistics and this new product mix and understand where this can be applied to the superstores. The store in São Luís, docas, and how we can improve the product mixes and this brings in more margins, right? As we've always mentioned, the logistics, right? You have the Spazio brands, and so you can improve the mix of these stores as well. We are at this accelerated process, right, to reduce ruptures and the 2,000 SKUs you can bring, and how much with private labels, et cetera, and how a food service can help with specialized cash and carry services, and how the pharma channel can also contribute to reducing logistical costs as well. We're trying to find where we can win in each area, right? It's not something that happens just out of nowhere, right? We're trying to find this balance point and how we can bring everything into the same level, right? Excellent. Guys, thank you so much. Our next question comes from Tales Granello. He's a sell-side analyst. Tales, you may proceed. Thanks, guys. Good morning. I had a follow-up here in regards to sales. You talked about the sequential improvement now that you're seeing in July, but also considering the base, it's a little easier. If you exclude the base effect and you also eliminate the counter sales, how would you imagine the sales evolving versus the second quarter? Is it actually improving or is it more of a base effect? My next question is about productivity increases, right? In the presentation of the first quarter, you brought in some initiatives for best practices alongside Novo, and I wanted to understand how this evolved, right? What was already implemented, what will be implemented, as Mr. Ilson mentioned. It's not a result we see in one quarter. It's going to take a little longer, but I just wanted to understand how these initiatives have been progressing. Thank you. Thanks for the question, Tales. I'll start off answering. In regards to this improvement in performance, same-store performance, if you observe Cash & Carry, this could probably give you a good example. Cash & Carry in the Northeast, Brazil in the second quarter dropped almost 4 percentage points. That's a scenario. We're in this context, we're part of it, right. We have 30%, which is our base, right, share in the Northeast. The difference between this drop in the Northeast and the performance we're having is really due to what I just shared with you and the strategic decision of kind of giving up on a significant volume, right. Just to answer this in a more objective manner, if we're able to correct this completely, this strategy, this counter strategy, then the levels of performance in the same stores should also keep up with what happens in the Brazilian Northeast. I think that gives you a good idea of the delta. In regards to Novo and productivity from now on, I think Sandro can help us a bit with this. As I mentioned, we've been focusing a lot on all of the indicators there, and you've seen significant evolution, right, from the first to the second quarter, and I think the most acute part is over. Right now it's just a matter of really seeing these significant evolutions, right, as we've already seen in the second quarter. I've spoken a lot with Victor and Daniel, and the expectations there are very optimistic. We don't want to create big expectations here, but no doubt we really believe that this regional will evolve and we want to bring it to a level, a lot of quality. Sandro and Tulio, feel free to hop in if you guys want to contribute with any of these points. In regards to Novo, I think it's worth mentioning to Tales that we have some initiatives we began, right, considering synergies, and they have received a lot more energy and focus, right. The quality of our stock, step by step we've been having important lessons learned, right. Finding this balance point in the assortment and how Novo understands the business, and how we understand the business with this bringing in productivity and revenue that's higher per category. You have the different topics with trading and commercial initiatives, and these are all projects that are ongoing and we want to continue to strengthen them, right. Naturally, what we expect with all of this is to improve our EBITDA margin and searching for what we can deliver together that's the best possible, right. We've been really trying to reinforce what we started off as initiatives and what we understand can be a lot more productive if we do jointly. I hope we answered, Tales. Yes. Thank you, guys. Our next question comes from Pedro Caravina. He's an XP analyst. Pedro, you may proceed. Thank you. Good morning, guys. If I could just insist once again on the EBITDA margin point. I know that you guys can't provide guidance or set a number, but I think it would be great if you guys could help us at least understand what are the levers, right. If you think about the JV stores and also the legacy stores, that are just purely Mateus stores, we can understand how much space we have ahead to continue to follow along with this margin, even in this pressured environment. As you know, the macro environment is really bad in Brazil, but even a little more acute around the Northeast. What is the mindset when it comes to capital allocation to really resume the payment of dividends or interest on capital and equity? Just these three points. Thank you. Thank you, Pedro, for your question. On the EBITDA margin, what we see as the main points are we experienced this scenario in the first semester of significant pressure and reduction in store to store that was very intense. Naturally, operational deleveraging, that was very strong. It is not simple to manage this kind of pressure in same-store sales at this intensity. I would say that from now on, since we have worked on this productivity initiative, that has been very solid. We prepared all of the mechanisms and metrics for productivity and all of the roles and functions in the stores, and this is something that we have control over. What we think is that as soon as the sales start getting better, we will have the capacity to keep all of the operational expense aspects. As soon as the sales get better and we have this consistency in our gross margin, what will happen is the gross profit will gain strength, operational will be stable, and naturally you will have some oxygen in the EBITDA. I think the main driver, once we have generated this consistency in gross margin, we have done significant work on productivity, and I think this is already on our axis. We do not need any other blocks in this sense. When we consider these two focus areas or consistencies, what we need to have is a sales recovery, because when that comes in, we will benefit from results from cash and everything will be a lot more intense. Of course, for this to happen, the foundation for the gross margin and operational expenses was really important to work on. Now we need to keep these solid foundations so that with the sales recovery, we can get this oxygen moving and all of the gross margin, net income, and cash. We are really focused on this. We discussed this a lot already, but I do not think it is time to intensify more productivity work right now. It is not the moment. We already had an important block. Now we just need to look at details, discipline, and consistency. We need to no doubt keep up, as we have been doing, with all of this consistency and discipline in the gross margin, respecting seasonality, but really closely watching this because with these two elements, we are sure that as soon as the - 8% becomes anything better, it will provide direct oxygen to the EBITDA. This is an important point, and in Novo, it is a little bit different because there we came from a first quarter requiring a lot of adjustments. We were very pressured. When that came along and we had these two gross margin points, that really reflected a lot on the EBITDA. It is important to highlight that the GMAT stores, that are part of Novo, are real young stores. They are still at their maturity curves. So it is a little bit different because you have all of the maturity curve going on. You have all of the merger of the brands and all of those issues. So it is a little bit different, the combination of these topics. But no doubt, as Jesuíno mentioned, and Sandro, we are on the sequence month after month of improvements, of course, because of this fine-tuning of the operation as a whole. That is the first point. The second point about capital allocation/appetite for interest on capital, et cetera. I would say the following. The company in the last two years worked on interest over capital and equity and JCP, as it is called in Brazil. We talk about tax planning and tax discussions as well. Depending on some reflections and decisions from this committee, we could or not create an opportunity for JCP distribution, interest on equity. We do not have this decision made yet, but it is definitely something we can evolve with in the second semester and discussions. But if we have this possibility, just as we did in previous years, this becomes an important step. So as we have mentioned here, when it comes to capital allocation, feel free to hop in. Mr. Ilson has a very careful and diligent approach to this topic, as he mentioned during the beginning of the call, with all of the CapEx mechanisms. We saw this in the numbers, and that clearly is a topic that is a real reality. We also have an agenda which is focused on cash generation and reducing leverage in the company. So Ilson asks me all the time about how we can cut down our debt. So we know leverage is pretty low. Our leverage situation is low, but with interest rates as they are, of course, there is this important agenda. Results, cash, and adjusting all of this with the net income, et cetera, so that then we can think about different elements, like pure distribution or JCP or through dividends. But this is definitely something we discuss internally. I think you covered it, Tulio. My concern during these 40 years was always our debt. I am really afraid of debts, and I never stopped talking about this. This is in our DNA, and we are going to work hard to bring this debt down. Because a simple mathematical calculation is if I pay off this debt, how much additional results or earnings I can bring into our results, instead of paying interest, for example. At a moment like this, we just need to keep quiet. Do more of the same, expand minimum possible in the business channels where we see the return rates are very strong. Just trying to keep quiet, and pay off debt if we need to. Then everything that we need to do that we consider to be important for the company. But here we just want to preserve our cash position, and that is what will really set the rules of the business. So I am always working on this assumption. Another point we evolved in a lot, which is really considering the opportunity for business. If we do not find good stores to have high tiers, there is no problem in distributing this kind of cash to shareholders, right? This is a point where we evolved this understanding a lot in the last few years. Another discussion we are working on intensely with Jesuíno and Sandro and Tulio is what we can do with the legacy we have, right? How we can gain efficiency based on what we have already built and per state, right? Because we still have stores that need to mature. I think, we are looking at close details of each store and each channel to understand what we can do. We do not want to reinvent the wheel, right? Whatever we can bring in as a win-win to our business, we will work on, right? With a high interest rate like this, we need to really focus on sales and close the count our pennies there. Okay. Thank you, guys. That is perfect. The Q&A session is officially ended now. We would like to once again pass the floor on to the company for their final remarks. Well, guys, thank you so much. Once again, I want to thank our CEO and our VPs and everyone that is listening to our call. We are really happy to be here and have been working on. To wrap up, I want to share a message of optimism. I have been traveling around our stores, talking to employees and managers and people that are growing and standing out and really performing well. We have seen a lot of great professionals during my trips. A lot of people were just assistants, and now they are already managers, or they are really eager to become managers. They want to grow. I want to say that our company has strong willpower, and we really want to invest in these talents, right? Because what makes a difference at the end of the day are the people, right? The people that are willing to grow, and that is what we see every day in our stores, right? We have some examples of simple people that got an opportunity and some people. We saw professionals that really feel motivated when they get the right incentives, and they did whatever they could to make stores that were at a deficit, really turn around. These are our future leaders. I also want to say that we are, of course, experiencing a challenging moment in many sectors in the economy, but we are here adjusting to each of these moments and scenarios that we are experiencing. We are focused, as we have just mentioned, and we are conscious of what we need to do, and we are working on all of these initiatives in our business as mentioned, each of these channels, searching for each opportunity. Once again, I want to thank God for giving us the wisdom and knowledge to go through these moments with calmness and knowing that we have good moments and moments that are not that good, but that we really need to be conscious of what we want to do, and above all, elevating and asking God for wisdom so that He can help us, right? It all comes from Him. I want to thank my friend, Jesuíno Martins, Tulio and Sandro, and our almost 70,000 employees and everyone that is working with us, adding strength. I want to thank our suppliers and investors. I want to reinforce our commitment. We cannot always do everything that our investors would like us to do. There are some things that kind of leave our control or our willpower. We want to say that we are constantly searching for these improvements, of people and processes. I also want to thank our employees that have been working with us as well. Thank you so much and have a great day. The earnings call for the first quarter of 2026 at Grupo Mateus is officially ended. The investor relations department is open to answering any of your questions. Thank you to all participants, and have a great day.