Good morning, and welcome to the RD People Health and Wellbeing Conference call to discuss its results for the third quarter of 2021. The presentation can be found on RD's Investor Relations website, ir.rd.com.br, where the audio for this conference will later be made available. We inform that all participants will only be able to listen to the conference during the company's presentation. After the company's remarks are over, there will be a Q&A period. At that time, further instructions will be given. Before proceeding, we must mention that forward-looking statements are being made under the Safe Harbor of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on the beliefs and assumptions of RD's management and on information currently available to the company. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties, and assumptions as they relate to the future events and therefore depend on circumstances that may or may not occur. Investors should understand that general economic conditions, industry conditions, and other operating factors could also affect the future results of RD and could cause results to differ materially from those expressed in such forward-looking statements. Today with us are Mr. Eugenio De Zagottis, Investor Relations and Corporate Planning Vice President, and Mr. Fernando Spinelli, Investor Relations and Business Development Director. I now turn the conference over to Mr. Eugenio. Mr. Eugenio, you may proceed. Sorry, I was muted and didn't realize. Hello, everybody. Welcome to the Raia Drogasil third quarter conference call. I would like to start by saying that today is a historic day for our company. This is the day of our 10th anniversary. 10 years ago, we established Raia Drogasil. The journey early on was not the easiest, but I think that by applying, especially in the initial years, a more traditional retail recipe, I think we were able to transform the company, create a lot of value, leverage the synergies, and get the best of Raia Drogasil, and keep the company evolving. I think this day is not that different in the sense that we are recreating a company. We were talking back then about a new company being created. Today, it's a company being recreated. It's a traditional retailer being transformed into an omni-channel healthcare platform. This is just as new, I think today as it was back then. We have the same excitement to start this journey that we had back then, and hopefully the same fortune to the same kind of value creation we were able to create ever since. Back to the quarter, I mean, we ended the period with 2,414 stores. We opened 52 units and closed 12. We gained significant market share, 110 basis points on a national basis. We reached 14.3% with gains in every single region. Our gross revenue in the quarter totaled BRL 6.5 billion, 21.2% growth. This is 2% mature store growth ahead of inflation, 2% real growth. Contribution margin. I would like to start by saying that for me, this is our most important metric because it's the one who shows structurally how the business is performing. We had a contribution margin of 10%, and this is a 10 basis points expansion versus same quarter last year and a growth of 22%. We're talking here gross margin minus sales expenses. This is the ongoing performance of our assets. We had an adjusted EBITDA of BRL 446 million, 6.8% EBITDA margin, and 12% growth. Net income of BRL 174 million, 2.7% net margin, and a cash flow generation in the quarter that was positive. Free cash flow BRL 73 million and negative total cash flow BRL 22 million. On the next page, we can delve more in detail about the expansion. We opened in the quarter 52 stores and closed 12 stores. By the end of the quarter, 32% of the stores were still undergoing the maturation process. We have recently, in our Investor Day, reiterated the guidance of 240 stores for this year, which we are fully on track to deliver and expanded the guidance next year to 260 stores. After five years, at this same regular pace, the strong performance that we have achieved give us the confidence to try and to take another step and open 260 stores. We have entered a lot of small cities, so on the next page, we are now in 453 cities in Brazil. It's clear by this chart on the left how different the expansion is today versus early on. If you go from 2018 to 2019, we're opening something like 30 new cities a year. Now, we are opening something around more than 60 cities a year. It's an expansion that has less to do about over-densifying markets and more to do about extending our presence into new cities, into new markets. Obviously, there are still markets where we can add a lot of stores, and we have done so. We're doing this with the same returns that we have done. Actually, with slightly better returns. If you look at our internal rate of return this year and last year, it's around 25%. In previous years, it was around 20%. We look at these new stores on a net basis because there's generally cannibalization. We do the IR calculation based on revenues net of cannibalization. Just to exemplify, it's very easy to open a store in the A neighborhood, São Paulo, Rio, et cetera. Very easy to open and say selling BRL 1 million per month. But in the end of the day, when we look, BRL 300,000 have been stolen from other stores. A store like this is only adding, let's say, BRL 700,000 per month. It's okay. When we open a store in new cities, smaller cities, B class and C class neighborhoods, very often the gross sales is lower than what we do in these more traditional areas. On a net basis, because there is not cannibalization in new cities, or there is way less cannibalization in popular areas of existing cities, on a net basis, we are performing about the same. The internal rate of returns don't change regardless of city income, et cetera. It's easy to see also how different the demographic profile of the expansion has been. A stores focused on A class customers represent 13% of the stores opened last 12 months versus 39% in 2018. The opposite is happening to popular stores that increased from 20 to 29, and hybrid stores that increased 41 to 58. We are more and more serving the expanded middle class in Brazil. We are more and more reaching new frontiers for us to bring our execution. When you look at the full portfolio, 33% of the stores are A, 45% hybrid, 22% are popular. Next page. I started by saying this is the day of our 10th anniversary. By year-end, I think there's another milestone that will have been achieved, which is becoming a fully national player. We are opening stores still this year in these three missing states, the small states in the north, where we don't have an operation, but we are on the verge of being there. We will end this year with 2,500 pharmacies present in every Brazilian state. We are not the only player to be present in every Brazilian state, but we're the only Brazilian player to do so while making money, while delivering high returns, while delivering high revenues per store, high profitability per stores, regardless of the market, regardless of the region, regardless if it's new or if it's an already developed market. We're the only player able to do so. We are also the only player to have an expansion in which 22% is happening at home, 78% is happening outside of our native markets with increasing return, as I mentioned again. This is very unique, and it depicts the capacity that we have to develop new stores, to locate them correctly, to operate these new stores, to consolidate our brand, and to create tremendous value by doing so. Market share was another highlight in the quarter. We gained more than 120 basis points in national market share. It reached 14.3%. We've gained in every single region. São Paulo reached 26%, 90 basis points growth in a market where we're not adding these many stores like before. This is for me, really impressive. Obviously, digital has a lot to do with this share growth that I'll talk more about later. Southeast, we gained 70 basis points. Midwest, we gained more than 400 basis points. Midwest is a different story here because the state of Goiás is the only state in Brazil without advanced tax collection. So there's a lot of merchandise going in and out of the state, and it's very easy for the share to get under or over-reported. What happened is that same quarter last year, the share was under-reported. So this 13% is not the normal share. So this is unlike a distortion in accounting by IQVIA. But still, it's not 400 basis points gain, but for sure it's more than 100 basis points structural gain here, just like in every other market. In the South, we have 140 basis points. In the northeast, 120 basis points. In the north, 100 basis points. When we break down our revenue growth by category, OTC has been the highlight with 30% growth. Obviously, the pandemic has a lot to do with the strong performance in OTC and lower performance in hygiene personal care. We have also done really well in generics, that we have grown 23%. We have the comps here. As I mentioned before, the top line consolidated growth is 21%. When we look at the mature stores, we're talking 12% mature store growth. This is 200 basis points above the average CPI, which is very high right now. This is about 500 basis points more than the price increase that was granted, early this year. It's an amazing performance. Without any shadow of doubt, this is a performance that is driven by the omni-channel strategy that we have been pursuing. When we look at digital channel penetration, this quarter, we did BRL 561 million in revenues. If we analyze this, we are around BRL 2.3 billion in annualized revenues at this running rate. Our digital alone is the number 6 or number 7 player in Brazil already. I think this is a pretty remarkable figure. Digital penetration increased once again to 9.2%, and this is absolutely crucial for our strategy. I'll show later why this. The number of app downloads is increasing a lot way faster than any other player in the market. We reached 14 cumulative downloads, and we have more than 400 cities with multi-hour ship from store deliveries on top of 100% of the stores with click and collect and neighborhood deliveries. Sorry, I think I just clicked one chart. No, it's this. Talking about the gross margin. We have a gross margin of 27.8%, which was flat versus last year. We have a cash cycle that has been declining already over the previous quarter. It's in line with the previous year. This is still a high cash cycle. Our number structurally is more like 55-56. I'm not guiding where it's going, but for sure this number is going further down in the next quarter. It's already going down, but it has to go down more. When you look at selling expenses, despite of the inflationary pressures that we are seeing in the market, given how fast inflation has been going up, the high comp growth that we have posted has allowed us to generate operating leverage to mitigate the inflationary pressure. We have diluted 10 basis points of sales expenses in the quarter, and this is for me, a very good result. In the end of the day, we're talking about a 10% contribution margin, 10 basis points increase versus last year, and a very solid performance. This is the structural health of the company. This is where we see how we're doing structurally, because this is how the stores are performing. Obviously, considering the transformation process we are undertaking, there is a lot of pressure in G&A. Our G&A today is 3.1%, 60 basis points growth versus last year. If you look back three years, it's 100 basis points G&A growth, and this is not money being thrown away. This is investment in structure to deliver our strategy. When we increase, we're talking about managing people, we're talking about squads, we're talking about analytics, we are talking about going to the cloud, and all types of IT infrastructure investments that are taking place. I believe that from now on, this figure should be stable, and in the future it should go down again as the digital health platform really start creating value. It's been an investment that has been absolutely necessary to do what we are doing. When we look at the EBITDA margin, I mean, obviously this 60 basis points G&A increase results in a 60 basis points EBITDA margin decrease. Again, when you talk about contribution margin, which shows the structural performance of the business, it's a slight expansion and not pressure. This is very important. I'm sorry. I mentioned inflation, and I'd like to show more details about this. As you know, we have an annual price increase happens in March every year that is very important to the outlook of the year. This price increase that happens in March is based on last 12 months inflation in February. If you look back what happened this year, we had a 5.2% last 12-month CPI in February, and the price increase was 7.5%. We got a price increase that looked really good and looked way ahead of inflation. The problem is inflation started growing at a very strong pace ever since. When we look at the average for the year, the projections point to 7.5%, which means that the price increase was exactly in line with inflation, but with good news in the first half of the year in which inflation is below the price increase, and with bad news in the second half of the year in which inflation is ahead of the price increase. Still, because of operating leverage, we have been able to manage our sales expenses and to maintain and slightly actually expand store productivity. When we look forward to next year, the projected inflation for February 2022 is 8.7%. Because inflation is expected to go down, the projected CPI for the year is 6.6%. I mean, as you know, the price increase that granted by CMED is a function of this inflation number plus or minus a productivity factor. This productivity factor has a lot to do with the FX rate and other cost factors affecting pharmaceutical industry like electricity. In my view, I'm not trying to predict this number, what the factor will be, but it looks very likely that the price increase will be above inflation. This will enable us to get an inflationary recomposition, which will be very supportive of a good performance for next year. Still, with this kind of pressure, we have been able to hold our own, and we have been able to maintain a very good contribution margin. Here we have an EBITDA reconciliation shows that we have BRL 1.2 billion non-recurring expenses. Finally, an adjusted net income of 2.7% and a net income in absolute terms of BRL 174 million. The free cash flow in the quarter was positive BRL 73 million, exactly because the cash cycle has gone down. The working capital consumption was very low here. It was actually positive. When you look at the total cash flow, it was slightly negative BRL 22 million. It includes BRL 73 million of share buyback to support our store, our stock-based programs and our financial expenses and et cetera. All in all, despite the fact that we still have a cash cycle above what's normal, our leverage is very comfortable, 0.8 net debt to EBITDA. Net debt total BRL 1.3 billion. Finally, when you look at the share appreciation, I mean, in the year, either if you look at the quarter or the full year, we are negative, but we're doing slightly better than the Ibovespa. We're generating some alpha in the quarter as well as in the year. For me, in a year in which we have a 10, o n the day in which we have our 10-year anniversary, it's important to look back and see what we have done since the merger. If you look how we're doing today, I mean, we have since December 31, 2011, we are exactly seeing that we generated a total shareholder return of 22.4% per year, which I think is a remarkable performance. Our aspiration is to keep delivering these type of returns going forward as we are embarking a completely new phase for the company as we try to become a digital health platform. It's important looking back on what we have done over these years. We see that the number of pharmacies we have opened that the company operates has tripled in this period. The revenues have been multiplied by 5. EBITDA has been multiplied by 7, just like the market cap has been multiplied by 7. It's obvious that this is a tremendous value creation coming way more from performance than from multiples. Since EBITDA and market cap, they both grew in the same order of magnitude. In this period here, it was not without pains. We had our moments of pain. I would highlight early on, integration pains. I would highlight 2018 when we had to invest in prices and reposition our generics. Obviously, it's never a straight line. I think the value creation trajectory, I mean, it cannot be disputed. Our aspiration is to keep creating value in this new phase of the company, just like we did originally. Wrapping up in terms of our performance, I think it was a very good performance in the quarter. I think the structural elements were very robust. Top line growth of north of 20%, with mature stores doing 12%, 2 percentage points ahead of CPI and something like 500 basis points ahead of the average price increase. Market share growth was very material with gains in every region. Our expansion is fully on track to deliver 240 stores this year and 260 stores next year. In terms of margins, we got a contribution margin expansion, and the pressure in EBITDA was fully driven by the investments we are doing to support this transformation process. Finally, there is an effect of inflation in the quarter, but there is an important recomposition expected to happen next year. Talking about the strategic elements of the execution, I'd like to highlight how we have evolved in the new pharmacy. We have today 9.2% of our total retail revenues coming from digital channels. Number of downloads has followed the angle of this curve. We have now 13.7 million downloads. Number is increasing at a very good pace. As you know, the store is the crucial element for our execution. The store is where the customer acquisition happens. It's not Google, it's not Facebook, it's not Instagram, it's not TV Globo. The store is where we onboard the customer when they learn about the app, when we persuade them to download the app, when they use the app in store and later on when they are at home. The store is the basis for our logistics. If I'm not mistaken, 85% of all our deliveries are executed by the store. It's either click and collect, which happens 50% of the orders, given the quality of our capillarity, or it's a neighborhood delivery, or it's a motorized delivery. The store is there. The store is the differential of what we're doing. You can't compare a pure play platform to an omni-channel platform. It's completely different. Here in the bottom, I would like to highlight why digital is important. I mean, digital is a separate channel. Obviously, we could look and think about how this channel adds to the global P&L. But in the end of the day, this is not about the channel, this is about the customer lifetime value. This is about the fact that a customer who gets digitalized buys way more often than a customer who has not been digitalized, and buys with much higher ticket as well. We see here in the bottom, when you look at the overall company, we have 41 million customers, active customers, 5.3 million of which are what we call loyal customers. These loyal customers represent close to 60% of our total revenues. Loyal customers who are also digital customers, and we're talking 50% of the omni-channel base, they represent 85% of the digital revenues. Here on the right, I think it gets self-evident the importance of digital. A customer who is not a loyal customer has an annual frequency of 4.4 times. These customers who become loyal customers, they come to us 22 times during the year. The first battle is driving unloyal customers to become loyal customers, because spending goes from 4.4. Spending increases even more than this because the ticket is also growing in tandem with the frequency. Loyal customers, they buy way more frequently than non-loyal ones. When they become digital, a loyal digital customer buys nearly 40 times a year, while a loyal analog customers buy only 22. As we digitalize the customer, we increase the frequency of the customer. We increase the lifetime value across every channel, not only in the digital channel. If we look at our digital channel, our digital channel is profitable but has a lower margin than the normal channel. We have somewhat lower gross margin. We have some expenses related to digital, but still a very profitable and healthy channel. When you look at the whole equation, when you look at the whole picture, I mean, this channel is very highly accretive. In the end of the day, the customer, even if the channel is slightly less profitable when the customers buy digitally, a lot of the times the customer is coming to the store. A lot of the times the customer is doing a click and collect. In the end of the day, we have been able to maintain our profitability, our contribution margin, and absorbing the fact that the channel margin is lower over a much broader relationship with this customer, which also involves the store. The importance of digital is self-evident here. Digital is not an end in itself. It's a means to an end, which is to drive frequency from 22 to 40 times a year. Finally, we have also advanced during the pandemic in services. This is the number of COVID tests we have performed. Since the beginning of the pandemic, there have been more than 3 million COVID tests. Obviously now, as the pandemic is easing up, the number is declining. But what matters here is not the COVID test itself, it's the culture of service that stays. Just like digital, we got an initial peak on the second quarter of last year, and then it receded initially, but then we grew again because it changed customer behavior. Here's the same story. The customer is learning that the pharmacy can help him take care of his health, his or her health. The customer can perform services with a high standard of execution, and the customer can trust our execution. This is the beginning of a culture of healthcare in the stores. This is way more important than COVID, than the COVID revenues themselves. Marketplace. I mean, this is year zero for our marketplace. This is an MVP who is running for barely a year. We have higher operating on every digital asset. Drogasil is just starting to get the marketplace, so it's not even fully operational for the chains. We are growing significantly, number of SKUs and number of sellers. The challenge from now on is in scaling up the marketplace and developing services to our sellers. Having a better seller center, and more importantly, offering the same kind of omni-channel logistics that we have in our 1P operation. I ask, a lot of investors ask me, "Why would a customer switch from Mercado Livre, Magalu or whatever digital platform to buy at our marketplace?" It's a very easy answer. The customer doesn't have to switch. He's already with us. I'll get back here. We have 39 times a year frequency for the digital customers who account for 85% of our digital sales. These are the marketplace customers. They are already with us. They're already buying from us with a very high frequency. It's a matter of them finding the product with a good app with a good merchandising execution with a good omni-channel logistics. The aspiration here is similar to the 1P aspiration. Imagine a customer who buys today, a 3P item, being able to collect this item tomorrow from us in any store without paying any delivery fulfillment fees. Who else has it? Nobody has it. We're talking about click and collect for the marketplace. We're talking about click and collect in the best corners of Brazil. I'm not talking shopping mall stores. I'm not talking pedestrian stores in poor areas of the cities. I'm talking about prime triple A real estate with great visibility access, parking, et cetera. I think by the time we integrate logistics, we'll have an absolutely unique value proposition in our healthcare marketplace. Finally, we also launched Vitat, which is our omni-channel healthcare platform. It integrates a healthcare super app, which is based on the apps that we bought from tech.fit. There are still apps which are standalone apps for specific functions like nutrition or exercise, but then we have the Vitat app that integrates with a journey perspective, all these activities. We have already more than 60,000 active subscribers that we inherited from tech.fit, 2.5 million downloads, 2 million users accessing our digital channels, more than 150 health programs across all the apps, more than 40 health programs if you look only the Vitat app. There's already revenues, recurring revenues coming from subscriptions here. This health super app that has all these programs will start having tele consultations and will be fully integrated with more than 1,500 health hubs located in the store. The customers will be able to schedule services. They'll be able to have their health wallet. You do a COVID test or a hemoglobin test, whatever test they do, they'll have their health history in the palm of their hands within the app. This is the beginning of something that I believe can be very important for us. Today, almost everything is free, but we have very clear hypothesis on how we monetize this platform. We're talking a lot B2C, but so much can be done on the B2B2C world, helping corporations in having their employees live a healthier life, taking better care of themselves. I think B2B2C will also be important for Vitat in the future. These were our prepared remarks. Now let's go to Q&A. Thank you very much. Thank you, Mr. Eugenio. We will now proceed to the Q&A session. The first question is from Eugenia Cavalheiro from JP Morgan. Hi, Eugenio. Thank you for the call and for taking my question. First, I'd like to comment a bit on the margin front. You mentioned in the previous call that you believe the current level of G&A should remain for a while and then start to be diluted again. Could you give us a bit more visibility on when do you expect this dilution to come and what levels, so should we expect the historical level of G&A to come back? The second one, regarding the digital initiative. You have a very strong number of your sales coming from the digital platform. Could you give us a bit of a breakdown by region? If there is any region where the digital platform is a bit more stronger than in others, and where could you have room for improvement? Thank you. Eugenia, thanks for the questions. In terms of G&A, I'll talk conceptually. I can't give any guidance here. We have been increasing G&A. Our G&A in three years has gone up 100 basis points. It's funny because everybody asks me about 100 basis points of margin up and down. Nobody asks me what happened to that 100 basis points of G&A went up. It went up on purpose. There is no way we can create a digital transformation, create a digital health platform, marketplace, et cetera, without revamping our technology infrastructure, our management team, et cetera. We invested. The good news is that our store generates operating leverage, which mitigated this investment. You don't see in the margin this kind of pressure aligned with the G&A increase. I believe we are already at a moment in which the G&A has peaked. I believe in the shorter term, it should remain in the same ballpark. I think further down the road, as we start seeing more digital acceleration and start seeing the GMV from the marketplace and digital platform really becoming material, I think the trend is for the number to go progressively down. It don't go down at once. I think it will be a progressive process. In the end of the day, we are a company who has a very long-term perspective in everything we do. We are focused on value creation. We are not focused on the quarter margin or the annual margin. Not that we disregard, not that we don't want to have the best quarter or year possible, but if we have to spend ahead to create value longer term, we do it without thinking twice. This is what's happening here. We're fortunate to have a group of shareholders who identify with this long-term vision. At the end of the day, the company chooses its shareholders based on how it manages its strategy. We have always focused on the longer term, and we have always been attracted by investors who think likewise and who are here for a longer term. I'm very fortunate to have shareholders with us who were with us in the Raia IPO, and some of them in the Drogasil IPO, others early on after the merger. We have, n ot to mention the three reference families, including the two founding families who have been with this company for, in the case of my family, for more than 100 years, in the case of the Pires family, for more than 80 years, in the case of the Goulart family for more than 30 years. This gives us this perspective that allow us to create long-term value as opposed to play a short-term market game that we see so often happening. Can you repeat your second question? I wrote down, but I'm not understanding my own writing. Sorry, Eugenia. No problem. So the second question was, if you could give us a bit more visibility on the breakdown of the digital sales per region. If there is any region where the digital sales are stronger than other, and where you see room for much improvement. Oh, sure. Thanks. That's actually a very good question. Yes. The answer is absolutely yes. Because I mean, let's put in perspective. We are not a regional company who is only in a single market. We are a national player. There are so many markets we have entered recently. There are a lot of cities that we have just barely entered. We have markets in which we are very mature and have high share. Other markets in which our share is still developing. Your question is absolutely correct. The assumption behind your question is absolutely correct. There are very high level of discrepancies in digital penetration. In our top markets, we have digital penetration which are already north of 20%. Not only São Paulo, we have actually markets higher than São Paulo. If you talk about São Paulo, Porto Alegre, Belo Horizonte, Rio de Janeiro, especially these four markets, the digital penetration is north of 20%. We have markets in which we have below 10%. If 9% is the average, obviously, there are a lot of markets that are more recent that don't have any ingrained digital culture yet and just starting to create that have 5%, 6%, 7%. I think there's a huge opportunity which is having these lower markets with low penetration catching up, and as a result, the overall penetration increasing. If we zoom into São Paulo, Rio, Belo Horizonte, Porto Alegre, et cetera, in the A areas it's even higher than 20%, and in the C areas it's lower than that. It's not an even penetration, and this is a reason why you cannot compare our penetration with that of a regional company who is only relevant on a single market, who already has a very high share and coverage in a single market. It's completely different because we are a national player, but we see that the numbers are moving up in a very good way. That's very clear. Thank you, Eugenio. Thank you. The next question is from Renan Prata from Citi. Hi. Good morning, everyone. I just want to get a color, a sense of how sales is evolving during October and if we should see in the next quarter the same penetration level as we saw in this current quarter or maybe in a higher level given the Black Friday. Thanks, guys. No, I think digital is performing well, and we believe obviously that we should be growing. Obviously, we had early on very steep growth. I think if you look from last quarter on a sequential basis, that's a good growth. We expect to see more growth in the coming quarters. I think, yes, this is happening in this quarter. Thanks for the question. Okay, thanks. The next question is from Gustavo Senday from XP. Hi, Eugenio. Thank you for taking my question. My question is regarding the new shareholder agreements. If you could give us more color on the role of the reference families going forward now that there is no longer a lockup in place. Thank you. Okay, thank you. I mean, we have a new shareholder. Let me just get back in time. When we did the merger that resulted in Raia Drogasil, we have four groups of shareholders coming together under the same roof. The Raia shareholders and Drogasil shareholders, they barely knew themselves when we got together. We got to know each other, I think one or two weeks before the signing happened. It was very important for the stability of the company to have a lockup in place. Because the lockup guaranteed that we have everybody in the same boat. We don't know ourselves, we don't have a history together, but we are locked up. If one gets drowned, everybody drowns together. I think this was very important for us to get where we got, for us to navigate well during the initial pains of integration, navigate the cultural clashes we had early on. There are cultural clashes in every merger of equals on the planet. I can guarantee that. Because we had unity at the shareholder level, whatever happened at the management level was always solved, and we had this amazing success. We had this ten-year cycle in which we had 30% or more of the total shares of the company under lockup. This is an absolutely unconventional structure. I don't know how many companies in the market have a lockup structure, but it was instrumental early on. We are now entering a new 10-year stage. We have a shareholder agreement in place for 10 years. This shareholder agreement maintains together the three families who have been for many decades ahead of this company. The founders of Natura, they are no longer in the shareholder agreement, but they remain shareholders. Their intent is to remain shareholder. Their board representative is still sitting in our board, and it's not going anywhere, so we are still very close to them and they're still very committed shareholders. The intention is staying with the company. Considering their choices, life cycle, et cetera, they're not prepared to sign a 10-year commitment like the founding families have done, and that's natural, but it doesn't mean they're going anywhere. We're starting this new cycle with 10 years of relationship behind us, and we don't think we need a lockup for us to be aligned. We have 10 years of amazing success working together, and we'll go on. Nobody should doubt for a minute the commitment of these families. It's obvious that the kind of strategy that we're pursuing right now is a strategy that is renouncing to shorter margins. Our G&A shows that very clearly. This is absolutely not the strategy of a group of shareholders who are interested in leaving the company. It's the opposite. We are committed for 10 more years in the company, and we have a shareholder agreement that supports us in doing this. Lockup is no longer necessary, just like we don't see lockup in any other company, and just like it wasn't necessary early on because there was a risk. That's clear. Thank you. Thank you. The last question belongs to Irma Sgarz from Goldman Sachs. Yes. Hi, good morning. Thanks for taking my question. One question I wanted to just come back to. I think it's been sort of regularly asked on these calls, but I think I know the answer, but I wanted to just sort of check the temperature on how you're thinking about organic versus inorganic growth. I think historically you've said that you know, organic growth has been at least in the physical stores, obviously it's different for new apps and new pieces into the ecosystem. I think my question is more about the physical store world, what you've historically obviously said is that the organic growth has been sort of your main choice mostly where it's been more accretive. I just wanted to sort of hear how you're thinking about that. The second question regarding the macro backdrop that we're seeing in Brazil at the moment. Obviously you've incrementally increased your exposure to the hybrid and the popular or sort of lower middle the middle class lower and lower middle class store formats. In those stores, are you starting to see sort of pockets of weakness in terms of consumers maybe shifting away from certain products or brands and how you're trying to counter or help the consumer in this context? What choices are you making, whether it be pricing or private label or other things that you can do? Okay. Thanks for the question, Irma. I mean, about your initial question, I think you're right also in your assumption. I mean, we pray in the church of organic growth. We are believers in organic growth. We do organic growth in our industry better than anyone has ever done, and we'll keep doing that. When we grow organic, we cherry-pick each location. We cherry-pick the distance from this store to the preexisting stores. We optimize, we minimize cannibalization. We optimize marginal revenue aggregation from the store, and we're doing that with increasing returns, not decreasing. Our internal rate of return this year and last year is around 25%. Historically, it was around 20%. It has grown because there's less cannibalization today than there was in the past, and I think we'll also be more efficient in terms of new store CapEx and things like that. We'll keep on growing organically. Obviously, if there are M&A opportunities, we look at every opportunity. Don't have any doubts about that. Every acquisition, I think they pass under our eyes before they pass under anybody else's eyes. Whatever acquisition we have not done is because we chose not to do. But occasionally we have done it. Onofre is a prime example. We had a company with very good locations in our core market. Small size, easy to integrate. There was also another asset that was on offer that we thought it was interesting. We bought, we integrated and did. We know how to do M&A. We are fully prepared to do M&A, but it's difficult to believe there'll be much M&A going forward in the core area, in the expansion, in the traditional new store growth. What asset has the kind of revenues per store that we have? What asset has the kind of locations that we have? What asset has the kind of people that we have? You don't find others. There are few good ones in the market which would cost one arm and two legs. And generally, the good assets are not for sale. The assets who are for sale are the bad assets. It's always like this. This is almost a universal rule of thumb in our business. We're in a great industry. Great companies don't wanna sell. The great shareholders want to be around on a very long-term basis for all the good companies in the market. The companies struggling are the companies looking to be sold. Generally, they are new entrants. They are private equity investors who have had a terrible experience and who have failed to create value. This is like cleaning dumps others have left behind. We're not going there. When you think about healthcare, we are way more open than that. I think the reality that we need assets which we don't have at home and can accelerate our strategy, I mean, this is already showing up. We bought tech.fit as the foundation for Vitat. We have RD Ventures looking at a lot of other things. We bought HealthBit, which will help us drive our healthcare platform into the B2B2C world. We bought Manipulaê, which is a apothecary pharmacy marketplace to complement our offering. Obviously, some deals have been very small. Others have been, I don't know. I think right now, no deal has cost more than, I don't know, BRL 50 million or BRL 60 million. Let's say if there is an asset that we think are highly complementary and costs BRL 200 million, BRL 300 million, BRL 400 million, BRL 1 billion, if we believe it creates value, if we believe it plugs well into what we're doing, there's no reason why we couldn't do it. In terms of the macro, I think the obvious influence that the macro has been inflation. I showed the inflation chart. We got good news in the first semester that the price increase was ahead of inflation and bad news in the second semester because the inflation is now ahead of the price increase. I believe it will recompose next year because the average price increase will be very likely higher, and maybe significantly higher than the average inflation for the year. In terms of demand, I mean, this is an out-of-pocket category. This is an essential category. It's very difficult for us to see behavior even in C stores to see very different behaviors than we saw. Not to mention that the expansion into the C class has been gradual. It's not like we bought a C class asset today and there's a turnkey. It's easy to see now what we put this before. It's gradual. I don't think there's anything to be worried about. That's great. Thank you very much. Thank you. The Q&A session is over. We now return to the conference call to our business executives for their final remarks. Eugenio, you may proceed. Okay. I would like to sum up some of the things we have said in this conference. I mean, first of all, when we look at the quarter performance, I think it was really good. All the structural elements are very strong. We see strong top line growth, north of 20%. We see mature store growth of 12%, 200 basis points ahead of inflation. We saw store contribution margin slightly expanding, market share growing very fast. All the fundamentals are there. We chose to invest in infrastructure to pursue a new strategy to develop new businesses, and this is natural, but that doesn't affect the core business. We are driven by the long-term margin, not by any bumps, because we just now have a higher G&A than before. I think this is part of life, and this is something that we have the luxury to do given the strength of our structural performance, and we believe that this will create a lot of value going forward. We are seeing a lot of advancements in these new businesses. I mean, digital is no longer about the future. Digital is taking place today. Digital is what accelerates our top-line growth. Digital is what's increasing so much the frequency and spending of our core customers and will keep accelerating digital, and digital will keep accelerating the comps, and the comps will keep accelerating the store contribution margin. When the new business start kicking up, also the G&A will be wind down. I believe the G&A now gets stable, but eventually it has to go down. It's just a matter of giving time for these two new businesses to perform. In my view, in five years, this business will be material. In ten years, these businesses will be transformational. This is the definition that I used in the Investor Day, and I think without going to any formal guidance, it's the best way to define how we're thinking about that. We are very focused on this new strategy. I believe that it's transformational. It's easy to think new pharmacy, marketplace, and health platform on an individual additive basis, but for me, it's not an addition. This is a multiplication. This is a platform effect. A customer who comes in from the new pharmacy will be able to buy in the marketplace and will be able to use the digital platform. A customer coming in the digital platform not only will allow them the digital platform to make money, but they will buy in the marketplace and in the pharmacy. It goes. The combination is way stronger than any part individually. I think everything gets very accretive as long as the customer lifetime value goes up, and this is what's happening already in digital. Digital is enhancing the overall one big lifetime value. By the time we get marketplace and platform up and running, I think this lifetime value goes further on and on, and I think this is absolutely transformational. Finally, I cannot close this call without thanking our long-term shareholders for your trust and support over these periods. As I mentioned before, it was not without bumps. We had our bumps early on during the integration. We had bumps in 2018 when we had to invest margins. This transformation implies margin investments, as I mentioned. Nobody asked me, but we increased 100 basis points of G&A in three years. People don't see it because the stores are performing, and we're compensating this with operating leverage. It's not a linear journey. This is the message that I wanna give. Again, I think the company chooses the shareholders based on how it acts, based on how it communicates. We have the luxury of having a very loyal shareholder base. Our several shareholders since the Raia IPO, since the Drogasil IPO, since the early days of the merger, many shareholders. It's our cap table is almost a boring document to look because it doesn't change much, especially on the top. It's this kind of trust in our execution, in our strategy, in the commitment of these founding families with the business for the long term that allows us to deploy this strategy. If we were subject to the same kind of quarterly pressures a lot of companies are because they have short-term shareholders sitting there, I don't know if we'll have the luxury to look the long term as we are able to. You guys are absolutely part of this journey, of this success, and we hope to stay together for the next stage. Obviously, the stuff we're doing now is not what families who are milking the cow to go away do. This is things that of people who are here for the long term and who are trying to recreate a company to evolve into a completely new stage, but a very exciting and a very promising one. Thank you very much.