Good morning, ladies and gentlemen. At this time, we'd like to welcome everyone to our RD Saúde Health and Wellbeing Conference call to discuss its 4Q23 results. 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, let me mention that forward-looking statements are being made under the safe harbor of the Securities Litigation Reform Act of 1996. Forward-looking statements are based on the beliefs and assumptions of RD management and on information currently available to the company. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties, and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur in the future. 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. Eugênio De Zagottis, VP of IR and Business Development, and Flávio de Moraes Correia, Director of IR and Corporate Affairs. Now I'll turn the conference over to Mr. Eugênio De Zagottis. Sir, you may begin your presentation. Hello everybody. Welcome to the Raia Drogasil 2023 end-of-year conference call. I'd like to start by saying that, in our view, last year was an amazing year for the company. I mean, in spite of having a lot of headwinds like a lower CMED price adjustment, negative mix effects because of 4Bio growing above 50%, the fact that 4Bio had the benefit of the DIFAL in 2022 and its base, so still, with all these headwinds. W e managed to have very significant EBITDA revenue growth, EBITDA growth, and the consolidated margin at the end of the day was only 10 basis points below what we had seen in the previous year despite all these headwinds, and we'll talk about more. The other thing is that if you look only at retail, despite the headwinds like CMED, that affect retail, a lot of digital growth that also is a headwind in terms of margins, even, even though it's very good strategically, we reached a retail EBITDA margin of 7.5% with 10 basis points of retail margin expansion, which is also very good and very healthy. A ll these figures, both retail consolidated, they bring together a fourth quarter that was below our, our expectation. It was not a good fourth quarter. It was a fourth quarter in which the market grew, below what it was growing and what we expected. Our mature stores trailed inflation, and we lost some operating leverage. D espite having one of four quarters that was weak in the consolidated number and in the retail number, we expanded retail margin, and we nearly maintained the consolidated margin. For me, this is a very good year. Moving forward, I think it's important to say that, yes, we had a softer 4Q with some margin loss, with low growth, but when we look at the beginning of the year we are having, January and February figures that we published, together with the earnings release, we are seeing normalization of growth, if not more so. I think we have a fourth quarter that might very well show a margin expansion on a consolidated basis. We are very happy with the beginning of the year. Structurally, despite a tougher quarter, I mean, the company is still the same of all the same, value levers and with the same kind of secular growth, helping us move the business forward. Well, delving into the highlights here, I mean, we ended the year with nearly 3,000 stores, 2,953. We are opening store 3,000 in the coming days. It will be in a city named Itapipoca, in the countryside of Ceará. We did last year 270 openings and only 14 closures. We reached BRL 36 billion in revenues. Revenue growth in this year alone amounted to BRL 5.4 billion, so a huge expansion of scale advantage this year alone. This is more than what the fifth company in Brazil sells altogether. This is what we are adding in top line in a single year: 17.4% of annual growth, 8% of mature store growth. Fourth consecutive year with mature store growth ahead of inflation. O bviously, digital has a lot to do with this. Market share reached 16.1%, so when this is not the average figure, this is the 4Q figure. Y es, it was a softer quarter in terms of growth, but structurally, we did really well in the quarter because we had 90 basis points market share gain in Brazil, gaining every market. Digital is now accounting for 16.7% of total sales in the fourth quarter, so we maintained our operation. We kept evolving in a quarter with lower top line growth. Contribution margin 10.7% for the year, 16.1% growth. Adjusted EBITDA BRL 2.6 billion, a very robust 15% annual growth with 7.2% of EBITDA margin, only 10 basis points lower than the previous year, but again, retail margin 7.5%, 10 basis points higher than last year despite the CMED increase and other headwinds. Net income BRL 1.1 billion, 3% net margin, 11.4% growth. Cash flow, the free cash flow was almost neutral, only -BRL 41 million, which means that we are self-financing. W e spent more than BRL 1 billion in cash cycle to support growth, BRL 1.2 billion in CapEx, and this is all funded by the operation itself. V ery, very strong numbers for the year as a whole, even though the year contains a soft fourth quarter in its base. This is a picture that I love to show at least once a year when we're looking at the previous year numbers. I think the point here is showing the capacity that this company has in terms of creating value sustainably over the long term, the compounding power that this business enjoys. Since the merger, we have multiplied the store count by four times. This is a company that was almost fully built after the merger, with the market looking every quarter at us and four times more pharmacy today than before, with eight times larger revenues, reaching BRL 36 billion, and 10 times more EBITDA than we had in the beginning. We were a tiny company with BRL 4.7 billion in revenues, only BRL 0.3 billion in EBITDA. Today, we are a huge company with BRL 36 billion in revenues, BRL 2.6 billion in EBITDA, and I think the best is ahead. Even though the percentage growth now may be lower than in the past because we became such a huge company, the total revenue and EBITDA addition we place every year is very meaningful. I n the end of the day, this is what drives our scale gain, our efficiencies. This is also a summary with a long-term view of how our market share has evolved versus the rest of the market. I think we ended the year with an average of 15.5% market share, 90 basis points gain over the previous year. Last year was the best year in the series in terms of market share gain. If you look previously, well, there was also 9.8%-10.8% here, but this is not something we have done every year, 11.4%, 11.8%, and then a jump here in 2019. I t's not a high record, but still a very strong figure. I t's interesting to see that we make nearly the same share of players two, three, four, and five combined with 3,000 stores versus 5,000 stores that they own. Obviously, we see that the other top players in the market are not gaining share at the same pace that we are. If you look in the beginning of the series, they've even lost market share. Over more recent periods, they are probably more stable than they are growing. We have smaller chains. These guys are bleeding market share. In 2014, they had 22.5%, then nearly 25%, and from 2016 to 2023, it went down from 25% to 19% of market share. This is a huge bleeding, and we are absolutely gaining the match here among organized chains. You have another portion of the market, which is the smaller players. Here, we have independents bleeding share and associations filling the space. It looks like the share has been constant, the combination of the two, around 50%, but what this picture doesn't show is that IQVIA over recent years has added a lot of informants to the base. I n my view, this share here is not comparable with here. I don't have any doubts that associations grew share, but the combined picture, if it was uneven reporting, it's an aggregated share loss for sure. Entering here in the highlight in the year, we ended the year with nearly 3,000 stores. We opened 270 stores. This is more than the initial guidance of the year of 260 and in line with the updated guidance of 270. We closed only 14 stores. 13 stores were mature stores with more than a decade of history. We are basically optimizing the store portfolio, and we closed only one store in maturation. Closing a store in maturation means an expansion mistake, period. W e are very happy to see that 270 openings, only one mature store closed. T his is an assertiveness that is completely unmatched in our industry. When you look at our store portfolio, 74% are mature stores, still 26% of stores that are not fully mature. T here's more operating leverage gains to come from maturation here, okay? We are today a national company by any means. We I like to define a national company as a player who not only has planted the flag in every market, but instead has occupied every market, has very profitable and consistent operations in every state, invests with the same internal rate of returns all across Brazil. In that regard, we are the only player who has the capacity of doing that. We see that our presence has been growing all over Brazil. We already have nearly 450 stores in the Northeast, which is like an oasis for us, an amazing market with a lot of growth. We had already close to 300 stores in the Midwest, close to 400 stores in the South, not to mention 1,200 in São Paulo, and meaningful figures all over Brazil wherever we go. Finally, moving here to the right, I was pointing but to very strong share gains. Our market share reached 16.1%, 90 basis points gain in the fourth quarter, with gains in every market. São Paulo, we are now at 28% of share. This is an amazing figure. Southeast 11.5%, Midwest reaching the milestone of 20%, which is very 120 basis points gain here, year-on-year. On the South 10.8%, Northeast 11.2%, and North 9%. Very, I think it won't take very long for us to see every region with double-digit share figures, and I believe there's still a lot of share growth all over Brazil for us to gain, okay? We now have stores in 4,574 cities. We added 34 cities last year, and it's easy to see that our expansion is very widespread. If you look at the store base, 41% of the stores are in São Paulo, 60% are already outside of São Paulo, but in the expansion, São Paulo was only 26% last quarter. This 26% is an acceleration versus previous quarters where the figure was only 20%. We're seeing opportunity in São Paulo. Our internal rate of return in São Paulo has been very high. Our comp growth in São Paulo has been very high, and we have done less stores than normal in previous years, and now we are accelerating in São Paulo. Nothing crazy. It's an adjustment. It's a cycle, but we see a lot of opportunities here. W e're still growing everywhere with very similar results all over the country. F inally, when you look at demographics, today, 40% of our stores are premium stores for high-income customers, but premium stores are only, depending on the quarter, 12%-20% of our expansion. The bulk of the expansion is hybrid stores, and there's also a good share of popular stores as well. W e are servicing every demographic here in Brazil. We today have operations in 307 stores out of 319 stores perdão, cities, not stores, with more than 100,000 inhabitants. T his is a very horizontalized presence in the country, okay? Talking now about the figures, we saw revenue growth of 17.4% in the year, but softer in the fourth quarter, 14.4%. When you look at the annual figure here, for 4Bio, impacted positively this figure by 2.2 percentage points, meaning we are talking here a retail growth of 15.2% in the year. For 4Bio, grew more than 50%, so it adds 2.2% to the growth rate. In the fourth quarter, the 4Bio effect is lower because it was already seeing a much higher comp base than in the average of the year, but it was a softer fourth quarter, only 14.4% of consolidated growth. When you look at the sales mix, the highlight by far has been hygiene personal care. Obviously, this is a category that, to some extent, suffered during the pandemic, suffered more on a mix basis than on an absolute basis because OTC was growing a lot during the pandemic, but now after the pandemic is controlled, we are seeing HPC grow a lot. A nother factor that helps us with HPC is that skincare is a category that we have meaningful competition from platforms. In previous years, when interest rates were low, when their investors were concerned not with cash generation, but only with growth, there was a bubble, and these guys were giving free flight, were breaking payments into 24 installments, and so they gained some volume. Now, with the high interest rates, with the quest for gen cash generation instead of growth, we are seeing them bleeding share in this category and we gaining share on them. This is also helping here on the HPC side. On a level playing field, I think we have the best value proposition in HPC in Brazil, period, given our digital operation, given our physical operation, and their combination. In terms of the comps, and I'll focus here on same-store growth, we grew only 5% on the 4Q23. T his was below the 5.6% CMED price increase, and obviously, we lost operating leverage as a result of this soft growth of the 4Q. The good news is that when we look January and February, and we are publishing here the preliminary non-audited numbers, we are seeing 9% on same-store growth. Obviously, that is two percentage points of leap year calendar effect, but still, if you're talking 7%, not 9%, I mean, on a calendar adjustment, this is a very good number. W e are seeing our figures get back on track very fast, and I think we are poised very likely to show a consolidated margin expansion already on the first quarter of the year. T his is very encouraging, and I mean, this, for me, this is important because, I mean, this this means like a bump along the road. The market, our market, is very resilient. Our market grows a lot, but from time to time, we see dynamics like this, that, okay, you have a quarter that something strange happens and the market doesn't grow, but then it rebounds very vigorously, following that. We saw that in the beginning of last year. We had a very soft January, and February, and then a huge rebound in March. T hese things happen. What matters is that the long-term market growth is always the same. The market is driven by the secular age of the population. We are seeing we will see in 2050 1 million more seniors above 65 being incorporated to the market. W e have a, a huge growth going forward, very predictable growth, probably like no other sector and probably like no other country. Here, in terms of digital, digital was another highlight of the year and also of the quarter, 15.2% annual penetration, growing close to 60% year-over-year, and this was by no means an easy base. When you look at the fourth quarter, we are talking about BRL 1.5 billion in revenues, 16.7% of digital retail penetration, and 60% of growth over a very difficult comp base of the 4Q22. T hese are amazing numbers, even regardless of if the quarter is a good quarter, softer quarter, but structurally, the company is doing its job, as we can see on the digital side, as we can see on market shares. We have a completely unique digital mix within our segment. 65% of our demand is apps. Our app today has a net reward score around 70. It processes a huge volume efficiently. I don't think we have an app that is as good as digital native players like Nubank, Mercado Livre, Rappi, iFood, but if you think about the physical retailers who have adopted omnichannel, probably we have one of the best apps in Brazil already, if not the best app, and there's a lot of opportunities still for our app to keep evolving, improving, more personalization, etc., but none of our competitors has a channel mix like this. Everybody is relying a lot on call centers, which for us is less than 1% of sales. This is a Jurassic channel, shouldn't even be considered digital, and everybody else has even on the digital side way more desktop than what we have. We have our digital offering is mobile-driven for absolutely. Finally, when you talk about delivery mix, we have 60% of click and collect and 25% of deliveries done by ourselves. It's not a third-party platform in less than one hour. Third-party platforms have only 7%, represent only 7% of our digital sales. We're talking iFood and Rappi mainly here, and they're not growing much in terms of penetration. Our main channels, the main growth comes from our proprietary channels, which is a good thing. In terms of gross margin, we had 28.1% gross margin in the year versus 28.5% last year. Here, we have very clear headwinds that we had to deal with. First, the CMED price increase was lower, so it means a 20 basis points headwind here. Second, 4Bio mix effect, because 4Bio grew so much with lower margin, another 30 basis points. Third, 4Bio had DIFAL in 2000, didn't pay DIFAL in 2022. That's another 30 basis points. W e had 80 basis points of headwind. We gained 40 basis points in structural margin, things like buying better buying, pricing, etc., and so the gross margin contraction, in the face of so many headwinds was only 40 basis points. Same happened in the fourth quarter. In the fourth quarter, we don't have CMED affecting, but we have the 4Bio effects at 30 basis points. If we lost, then if we gained 10 basis points meant that we saw a structural gain also of 40 basis points in the quarter. Private label is another thing that helps with these things as well, not only in addition to pricing, buying, etc. In the end, we have been able to reasonably defend our gross margin in the face of these headwinds. Cash cycle was slightly increased over this year, also affected by the fourth quarter sales. So there's less sales to that with the same inventories, so 3 days more than fourth quarter 2022, but sequentially much better than previous quarters. Selling expenses is one of the highlights of the year. We diluted 30 basis points because of operating leverage, but then on the fourth quarter, with softer demand, yeah, on a normalized basis, and I mean on a normalized basis because if you refer back to the earnings release of the 4Q22, we had 50 basis points of tax benefits on expenses related to previous quarters of 2022 that were booked on the fourth quarter. The reported expense was 17.1%, but the normalized expense was 17.6%. This is in the release of that quarter very clearly shown.N ormally we have to compare versus 17.6%, not 17.1%. W e saw a 30 basis points pressure versus this normalized level exactly because of losing operating leverage in a quarter of softer growth. Contribution margin, we lost 20 basis points in the year. We lost versus the normalized one also 20 basis points in the quarter, and obviously, the reason is the soft demand for the fourth quarter and also those headwinds of 4Bio mix, 4Bio, also, DIFAL, for the year, CMED as well. G&A, stable in the quarter. G&A was also penalized by softer sales. It should have seen a slightly better dilution than this. On the year, it went up 10 basis points. We are pretty stable now with G&A, and the challenge now is getting to starting to see the G&A getting diluted. Finally, adjusted EBITDA, only 10 basis points of annual EBITDA margin loss. The EBITDA grew in absolute terms more than 15% in the year, which is an amazing number, and again, 7 to 10 basis points margin loss in the face of less CMED, in the face of the 4Bio pressure is an amazing result that we were able to have in the year. The quarter was softer for sure, but then, we are seeing normalization already in the beginning of the year. Net income, we did a 3% net margin. Same dynamics, some margin loss on the consolidated figure, some bigger, net margin loss on the quarter because of the softer sales. Another point that I want to highlight is that, we are very meticulous on how we deal with non-recurring expenses and non-recurring revenues. A s you can see here, even though we are publishing BRL 2.6 billion of adjusted EBITDA, the actual accounting EBITDA is BRL 2.7 billion. W e have here BRL 70 million in gains from other years that we are taking out of this figure. Generally, retailers are very good at separating non-recurring expenses, but they fall short on separating non-recurring gains. We are very meticulous both ways. And what's curious is that, as you know, the benefit of DIFAL that we had in 2022 was recently reverted by the Supreme Court, so we have BRL 60 million to pay. This is non-recurring because it relates to 2022, not to 2023, but we have other non-recurring gains that have more than offset that and generated a BRL 2 million non-recurring gain in the face of this thing. It's important to mention that from a cash perspective, we have judicial deposits that we never counted as cash, so the leverage or the cash situation of the company doesn't change as a result of that. Finally, free cash flow was almost neutral, only BRL 40 million cash consumption, meaning that the business itself funded the whole investments made of BRL 1.2 billion, plus BRL 1 billion of cash cycle to support the store growth expansion, etc. I t's amazing that we are self-financing here from an operational standpoint. When you look total cash consumption, then it's BRL 700 million. Obviously, we are paying BRL 466 million to shareholders. We have net financial expenses, so here there is a BRL 700 million pressure, but the leverage has been maintained very low at 1.1 times net debt to EBITDA. The share price did really well last year, 23.6%-23.9% appreciation. Ibovespa also did well, but we did slightly better, and obviously, the compounded returns since the Raia Drogasil IPO or since the merger are staggering. I 'll conclude the financial highlights. I'll pass to Flávio. Flávio. Thank you, Eugênio. M aybe just to summarize some information that Eugênio just passed, in our presentation. We had a very solid financial performance in this year in 2023 and also in the 2023 fourth quarter, considering all the headwinds we had during this period, so pressures with 4Bio and with lower CMED. T hat said, our structural growth remains accelerated and decoupled from peers. W e see a consolidated revenue growth of 17.4%, which is outstanding compared to retail in general in Brazil, and also a very positive performance on 4Bio, growing almost 55% in this period. Okay, solely this year, we added BRL 45.4 billion on revenues, which is amazing. This is an amount as big as the fourth player in our retail pharma industry here in Brazil. M ature store sales, which are very relevant for our financial performance because helps diluting our expenses, fixed expenses on store. Mature stores grew 8% on the year, which is 3.4 points above inflation, CMED inflation, so this is great, and we reached this national market share of 16.1% on the quarter, so this is a record for our company, and with an increase of almost 100 or 90 basis points here of increase from one year to the other, which is also quite relevant, and more relevant yet if you consider that this growth happened in every region we are present, so we are capable to positively and healthily compete with the different local players no matter the region we are in, so we have a very strong operational operation in our pharmacies, wherever they are in Brazil. This translates to a very solid structural financial performance on our EBITDA as well, so EBITDA reached 7.2% this year with some pressures coming from 4Bio and lower CMED, so even considering these pressures, we are able to healthily grow our EBITDA margin with a growth of almost 15% on the period, and considering our retail EBITDA by itself, so it grew 10 basis points year-over-year, reaching this level of 7.5 percentage points. This is the quantitative part, so let me explore a little bit the qualitative part of our performance. Mainly, we have here three levers that are translated to our performance. First thing is our footprint and expansion. We opened 270 stores this year, which are record IRR of roughly 25% on those stores, so we are reaching now the store number 3,000 in Brazil. It will be open in the Ceará in the next days, so this is an amazing benchmark, and we now count three more distribution centers, and those distribution centers coupled with the other 11 we already have are responsible to replenish 92% of our stores every day, so this helps with the cash flow and inventories, the management and everything, so very good performance. A nother very important lever is our digital or omnipresence. Nowadays, it is impossible to dissociate our physical stores from our digital performance because digital comes out of the existing stores we already have, so this helps us dilute expenses, this helps us to increase sales by the different stores we have, and also to improve the experience the customers have considering the company in general. We reached a participation of 16.7% on digital sales in this fourth quarter, and digital by itself accounts for BRL 5.1 billion on revenues, which is as big as the fourth player in the market here in the pharma retail market in Brazil, so it's important, and still growing at a pace of 57% year-on-year, which is amazing for such a large business as it is nowadays. O n orders, you can think that we are now delivering or this month we just delivered more than 1 million purchases or orders during the period, so we have a very big scale on this activity, nationally in Brazil, and also improving the experience of the consumer. We are now at this NPS of 68% considering the digital channels or the app we have, and the delivery NPS is reaching this 88.1 index here in the country considering that we are delivering most of our orders in less than 60 minutes everywhere in Brazil, so this is a very fast pace. The third lever, important lever, is the evolution of the healthcare services we are now providing in the stores, so now we count almost 2,000 pharmacies with pharmacy services, and more than 300 stores that are able to apply vaccines or immunizations, and we are now one of the biggest private providers of herpes zoster and dengue here in Brazil, so this, on dengue, for example, so we have a market share of 70% of tests for dengue, and we have a market share of 40% on private vaccination for herpes zoster here in Brazil, so this bets on our strategy to become a very relevant healthcare player in Brazil. Okay, so those are the pillars. We also count as enablers other activities, so customers and engagement. W e now count these 47.6 million active customers on the company. T his is almost one-fourth of the Brazilian population, and 6.4 million are frequent customers with an average frequency of more than 24 times a year, transactions per year in our company. T his helps engaging the customers, creating bond, and maximizing the lifetime value of these customers, and coupled with this comes our loyalty program and the Stix program that reach 4.8 million active customers in the period, and more than BRL 200 million in redeemed points for the product for the customers in the program. Not only that, our banners and brand have a very strong position in the market nowadays, so Drogasil was indicated as the 14th biggest or most valuable brand in retail in Brazil, so this is a quite relevant position in the rank, and Raia is also recognized, so Raia and Drogasil together or independently, actually, are the number 1 and the number 2 most recognized brands in Brazil for retail pharma and also in revenue terms, so we have in the company the two most important brands of pharma retail. Okay, and this also translates to our RD brand or private label considering Needs, as one of the fourth largest brands in HPC, just behind the traditional brands that everybody knows, so this is a very relevant position. We keep digitalizing our infrastructure and we increased the pace in our release updates, and so we improved by 5.5 times the release per year and now we are 4 times faster in putting something on the air as compared to 2 years ago. We count now 57,700 employees, and those employees are at the base of our performance because they engage to our customers every day. We hired 4,200 employees during this year and we have an average training of 108 hours per employee per year, so this is how it takes to build this experience that we are creating for our consumers. Okay, and on sustainability, I'll also talk a little bit more on the next slides. Considering our ambitions for 2024, so we keep with this ambition of become by 2030 the group that contributes the most toward a healthier society in Brazil, acting in three different sets, so healthier people, healthier businesses, and healthier planet, so it's not only a matter of performing well quantitatively but also in the qualitative side. F or 2024, we aim to accelerate the digitalization of our customer relationship, so we are now at this 16%-17% participation, but we should reach or we could, we can reach this 20%-25% participation on digital sales in short term, and digital is important for us because it helps customers or it serves customers when they want and where they want in a very fast pace, in a very competitive set of assortment and prices, so this is very important for us. Digitalization improves loyalty, digitalization improves engagement and frequency, so all the features that are required for this company to excel. Okay, opportunities in healthcare is another set of activities for 2024, so promoting pharmaceutical and immunization services is at the core of our expectations for 2024, so this is at the center of engaging more customers and improving the experience we can provide to these customers. W e understand now that, based on various conversations and research, we made that most of 80% of problems that happens at the entrance door of a hospital could be well very well treated by the role of the pharmacy, connected to these consumers, so we are optimizing this kind of healthcare service in our stores, in our pharmacies to improve this participation. Okay, and also a very important thing is to keep integrating all the invested companies we have already invested in or acquired during these past years to guarantee that we are maximizing the pace of the business we built. Okay, finally, so maintaining accelerated growth on the, sorry, on the expansion on the mature store, so as you know, as you are familiar with our strategy, and this will help or this will be the part that helps us to dilute the administrative expenses which are at the center of our strategies as well for 2024. F inally, entering this sustainability slide, so we are very proud of the results we reached in this environment, so it's not only about having a very good company in the quantitative side but also considering the perenniality of this business for the years to come. We were able to better organize the strategy or the management and control of this activity, and due to this, we were able to evolve in all different ranks that are considering the sustainability, environment. O n the ISE B3, we improved our score from 52, four or three years ago to 80, to a level of 80. On CDP, we were able to evolve up to A- this year, and on MSCI also, we reached this A score in 2023, so we are very proficient in gathering results on these activities as well, and also very proud of now being part of IDIVERSA B3, which is a rank for diversity, led by B3 here in Brazil, and we are ranked top three in this rank, so it's very good for us. This is actually the translation of our strategy, of our way of being and doing here at Raia Drogasil, so taking care of people, both our consumers and our personnel here, we execute with focus and we build the future, so those are the three main strategies we have on this quantitative side. Thank you. Thank you, Flávio. Thank you, Eugênio. N ow we'll start the Q&A session. There's one question from Joseph Giordano from JPMorgan. Joseph, please go ahead. Hello. Hi. Good morning, everyone. Good morning, Flávio, Eugênio. Thanks for taking my question. I want to ask on two fronts. t he first one is around the expansion plan, right? m any people are concerned about declining returns in the company, and we continue to surprise ourselves with, like, still very high returns in markets where the company is already very mature. my question to you is, how many more stores you do see? W e do have a guidance, right, 280-300 stores a year, but my question to you is, like, what do you see as the potential for store count? A t this point, like you mentioned in the release that you are actually targeting already close to 60% of the population within 5 km radius. I just want to understand, like, what's the potential for that, just to understand, like, the extent of this growth. T he second one goes into the digital strategy, right? This is, like, actually expansive addressable market, for the company beyond the pharma, so, like, it's not just about loyalty, but it's also about engagement and, new service lines that you guys are flagging more and more about those health services. M y question here is, like, how should we think about the potential of those new, revenue lines, right? T he healthcare platform, we also have ads, and so on and so forth. O ne, that I already asked in a Portuguese call and, you guys didn't touch on this is around the tax changes and how this should impact, the industry, in general and how potentially benefit the company. Thank you. Question. When you were asking the first question, I don't know if everybody or only us, we couldn't hear the beginning, but, I think I can see where you're getting. If I don't answer, please repeat that. Y ou're asking about store count we have today and expansion and when where this can take us in the future. I think it's very difficult to make a long-term assessment in terms of number of stores. Obviously, we have a guidance for this year and for next year, but maybe we could maintain for much longer than that of 280-300 new stores. I mean, if you're talking about opening another 1,500 stores over, I don't know, 4, 5 years, I think that's absolutely doable, but I don't think the potential ends there. I think one of the challenges that we have always had is that when we look ahead, we never see the full picture and the full mosaic of opportunities. I mean, I remember when Raia Drogasil merged, Raia was opening 60 stores a year, Drogasil 40, we had a total of 100, and, I mean, maintaining the 100 looked like a tall order back then when we merged, and then we could further evolve and do 130, 150, 200, 230, and now 270 this year and maybe 280-300 for the coming year. W e have always underestimated whenever we try to make an assessment, we have always underestimated the potential. We never see the full picture. For me, a better way to look at this is we have today 15% or 16% of market share, on the market, part one. Part two, this is a market that is growing around, I don't know, inflation plus four, inflation plus five every year. If you talk about 10% annual market growth, we are not far from that. I mean, that's probably what the market grows. T his is not a market growth for two, three years. This is a market growth for another 20 years, if not more. W hen we look further down the road, I mean, we'll have a much bigger share on a much bigger market. There is no way we can believe that we are a mature company if we have only 16% of national market share, and only, and even in our main market that is São Paulo, we just reached 28% of market share. This is less than CVS and Walgreens have on the full U.S. market, for example. I believe we'll have a much bigger share on a much bigger market. How we get there is a combination of new stores being added and growth ahead of inflation in existing stores. I think today we are seeing a combination of both. Mature stores are growing ahead of inflation, and we have a lot of stores addition. If at some point in time the store addition stops growing or even goes down, mathematically, we'll have to see the mature stores growing faster and maybe if even better margins, more operating dilution, etc. For me, this is the real the better way to look at the long-term opportunity we have is, I know that in five years we consider maturing stores, new openings, 16, we'll get to four, five years, maybe 20%. I think that's very, very realistic, but what happens beyond 20%, is the ceiling at 25%, 30%, 35%? That, I don't know, but even if it's 25 or 30, it's 25 or 30 of a much bigger market than the one we see today. This is the first part. The second part, I mean, when you look at digitalization of the company, I think we have to look at things in two different ways. There are some initiatives, and I think you were happy to name RD Ads, that have an intrinsic potential, that they become a P&L, and they become a direct source of EBITDA gain, net income gain, etc. RD Ads is a prime example of that, and I don't know how big RD Ads can be, but, I mean, we are a company today with a consolidated EBITDA margin of 7.2%. Anything that can increase the EBITDA margin by 20 basis points, 30 basis points, 40 basis points, 50 basis points is huge for us, and for me, this is the kind of thing we expect. I'm not guiding at anything. I don't know, what's the end game. RD Ads already helps us in our margin, but still, I would say not that much, but I believe in two, three years it makes a difference, and we'll be talking about potentially bigger EBITDA margin because of the RD Ads. T hen a lot of the other things that we're doing, they have an indirect effect. It's a lifetime customer lifetime value effect is what we call the engagement bonds or engagement ties, however you prefer to say it. These are a myriad of different services and solutions we provide to our customers, and because of those services and solutions, the customer becomes more loyal, will shop more frequently, and will spend more than before. T he digital journey, the app journey is the most obvious engagement bond because people are digitalizing, they have a better experience, they are spending more refunds, and we're growing with them, but that's not only that. Private label, it's not digital, but it's another engagement bond. Our private label customers, they get loyal to the private label brands, and then they become more loyal shoppers. Healthcare is that. I mean, having a P&L of pharmacy services is not realistic. Maybe vaccinations, yes, it's profitable, but the rest of the services, yeah, it may have a direct margin, but we have a personal cost. We have a pharmacist administering this service, so we are not measuring the P&L of the health hub, but because of the health hub, because of the services that we provide, the customer will be better serviced and will be more loyal and will spend more overall. Because of the health hub, we'll sell more medicine than HPC and OTC. This is what I mean. This is the same with Vitat and other elements of the digital of the healthcare strategy. It's difficult to monetize them on their own, but because we are offering those solutions, people will spend more overall, and I think, one of the best things we do as a company is thinking as the customer at the thinking about the customer as a whole and taking decisions looking at the whole picture. We are not a compartmentalized company that has to optimize the digital P&L and then the healthcare P&L and then the retail P&L. I mean, I have no problems not making money on some parts and even losing money if necessary on other parts as long as it contributes to the overall picture, and we are set organizationally in a way that allows us to do that. This is very unique. Most large companies are compartmentalized. They may think about LTV, but they don't act towards LTV because of this fragmentation of power. Finally, on the tax changes, I think this is a very important question. I mean, we are seeing a lot of changes, especially relating to tax benefits. I would like to start by saying that we are by far the retail not only the pharma retailer, but probably the one meaningful retailer in Brazil who has the least benefit of tax incentives. Our logistics has never been assembled around tax incentives. Our logistics has always been put in place to optimize logistics. Today we have 92% of stores who get deliveries, replenishments six days a week. This is the ideal model, so we get DCs close to where the stores are. We are not getting DCs to places in which you have a tax loophole or we ship from one state to the other. This is not what we do. Having said that, do we have tax benefits? Yes, we have some, and a number that I can give you is that only 22%-23% of our revenues come from regions where we have a tax benefit. This is way less than anybody. Any pharma retailer who buys from a wholesaler is getting benefits from over 100% of their purchase in terms of tax benefits. Some of our competitors, they bring merchandise, they move merchandise all around the country from tax havens in Brazil, like Ceará and others. W e have the least exposure about that. I f tax benefits and this is not as a light negative, this is a huge positive. This is the message I want to convey here very clearly. The end of tax now it's not the end. It's the limitation of some of these tax gains because they've been taxed, but after the tax reform, it will be eventually the end of that. Those are amazing news. It's not a small problem. It's a big solution. C ompetitively, this will mean that the market will have to change. This will mean that wholesalers will have to pay fiscal fees over their tax gains or even income tax over the tax gains. This means that this will eventually have to move to the prices they sell to our competitors who will have a higher COGS or have to price higher who will donate market share for us. This is the end game. The confusion now lies because these changes are being questioned in the judicial system. There are players who are probably not even booking those new charges, and there are players who are booking the charges. We are in the second group, so what we will do, we are booking every new tax charge. We have a slight fiscal fees effect on tax gains of 10 basis points margin loss, which is easy for us to compensate. Then, we have something like BRL 150 million in higher income tax that we have to pay. That's, it takes longer for us to offset, but these bills for our competitors who buy from wholesalers or who take advantage directly from these tax havens will be much bigger. It may not show initially because we are accounting for them immediately in our results, but other players may not do that. I think in the end of the day, if there is a rationale, everybody will question that. I don't know if the question will be will gain or will lose. Our approach is we book, and then if all of a sudden we don't have to pay those taxes, we'll have a non-recurring gain to profit from at some point. A lot of players are pretending they don't have this tax bill to pay, and so the price effect the pricing effect may not be immediate, but eventually the market will regulate itself. Either they will have to pay this bill, and then we have a huge competitive gain, or, they will not have to pay, we will not have to pay, and then, okay, we get 10 basis points more in EBITDA margin and BRL 150 million less in income taxes. This is how we think about that. Our next and final question is from Melissa Byun from Bank of America. Hi, thank you so much. Just two questions from my end. First, that you highlighted, administrative expense dilution this year. Can you provide some expectations on the other elements of your cost structure where you might have areas of investment and opportunities to leverage expenses? T hen, on RD Ads, can you talk a little bit more about the progress you made in 2023 and expectations in 2024 in terms of technology that's being deployed, tools that are available for advertisers, and the evolution of returns on ad spend for your clients? Thanks, Melissa. Thanks for the questions. If I understood correctly, your first question is about the G&A. I mean, I think we have different elements when you look at our G&A. One element is the traditional G&A, which is the corporate overhead, people, etc., and here we are getting dilutions already, but the digitalization of the company has changed the nature of this G&A. That is now variable expenses into the G&A. For example, cloud usage, for example, software as a service. These are the lines who are tougher to control. F or example, we are getting more efficient in terms of cloud usage, for example. We are getting more trying to renegotiate and even limit new platforms that generate a lot of pressures in software as a service. I t's taking longer for us to understand the nature of these new expenses and act on them, but it's happening, and I believe this year we'll see G&A dilution because of that. The traditional legacy component of the G&A has already started to dilute, but in any way, to the very least, it's fixed the G&A now. I also invite you to think about the fact that G&A for us, give or take, is 3.5% of our sales. If you look, for example, at our sales expenses, this is a much bigger figure than that. O ur sales expenses today, they are, in a normal quarter, 17% of total revenues. I s it easier to gain on the G&A, or is it easier to gain on the sales expenses? I t's nice to dilute G&A, but okay, you're talking 10 basis points here, maybe 20 basis points if you're really successful. Anything that happens on the store side, you can see a 30, 40, 50, 70 bips, 100 bips dilution depending on the sales expense. W hat will make our numbers in the future is not the G&A, even though we expect to see some dilution there. It's on the selling expenses, and sometimes investing G&A, you become it strengthens the store operation, and you dilute more the sales expenses. Over the last four years, G&A has grown by 100 bips. Guess what? Store contribution margin has paid that and also grown by 100 bips, and we are today a company with twice the EBITDA that we had four years ago and 2.5 percentage points higher return on invested capital than we had five years ago. W e have to be careful here not to be too obsessed with the G&A. The G&A is one line, and we consider that, but this is not where we gain or lose the match. We gain or lose the match in the sales expenses and maybe even on the gross margin way more than on the G&A. RD Ads is another tool exactly to drive that efficiency. In the end of the day, when you talk about RD Ads, we're talking about increasing the customer lifetime value, about better engaging our customers and suppliers in ways that we can generate for the customers promotional opportunities, and we can give a higher share for these suppliers who use RD Ads while increasing our monetization both from what we charge and from the higher spending that RD Ads can generate. I think this is a year of learning. It's the first years of RD Ads as a standalone company. We have, I mean, we are making our partners know that we exist. We have made them try our solutions. They are used to measure things on a different way. The currency of digital marketing is click-through, and click-through is a fake currency in my view because I may click on an ad and not buy, or I may see the ad, not click, and buy on the store next day. Click-through doesn't capture that, but that's how the advertisers like to look at information. We are now trying to build the culture of looking on return on invested capital, marginal sales, marginal share gain, and things like that. Our tools have to evolve, so it was taking more than one month for us to measure things. We are now investing to make next day kind of kind of or next two days kind of reporting that we need. We are starting to get ready to interact with advertising agencies. That this involves how we remunerate them, incentives. I mean, it's a learning opportunity, but we're very excited with RD Ads, and again, the goal of RD Ads in the end of the day is increasing our EBITDA margin by 20, 30, 40 basis points. I don't know what that will be. It will take a couple of years to get there, but I'm very confident we will get there. Good. Thank you so much. I actually was also referring to some of the line items in your sales expenses, so things like, you know, occupancy costs, personnel expenses, maybe some of the investments you're making in your health hubs and the stores, just to get a better sense for store contribution margins and cost versus the operating leverage component. Yeah. So yeah, it's a good clarification. Today, when we see these sales expenses, they are very in line with inflation. We're actually seeing rentals grow below inflation. We're seeing labor growing with inflation, but here in the end of the day, because these expenses are very fixed and very just slightly with inflation, the name of the game is operating leverage. If the mature stores outgrow the inflation, these expenses will grow with the inflation, and then the real growth will go straight to the bottom line or the opposite, like we saw in the fourth quarter. In a quarter in which mature stores don't grow with inflation, the revenue is growing below what those expenses are growing, and we lose operating margin. So, I wouldn't be too worried with the individual variations of those lines because they are very controlled and predictable. What drives this line, what makes or breaks it here, is mature store comps. Perfect. Thank you so much. Very clear. Thank you. The Q&A session is over, and now Mr. Eugênio will present the final messages. I'd like to thank you all for attending this call, and I would like to sum up some of the things we have discussed here. I mean, the first thing here is 2023, by any means, was an amazing year for Raia Drogasil. Nothing short of that. We have a retail margin of 7.5%. The retail margin went up by 10 basis points even though we had a headwind from lower CMED price increase, which means at least 20 basis points in headwind. We had negative mix effects from the core retail business from digital. We have negative mix effect from Ozempic, which is selling now some months 4% of total sales with much lower margins. We're talking, low double-digit margins, or high single-digit margins sometimes. So, in spite of all these headwinds, the retail margin grew. When you look at the consolidated margin, the consolidated margin went down by 10 basis points because we have, on top of those effects, 60 basis points in 4Bio effect, 30 basis points, which is a good problem to have for-buy growing more than 50% in the year with a structurally lower margin, but then 30 basis points because we had DIFAL we didn't pay DIFAL in the comp base of 2022. So, still, we generated efficiencies so that with all those headwinds, retail grew 10 basis points and consolidated lost 10 basis points S till, by losing 10 basis points, consolidated EBITDA went up north of 15% of the year, and we are talking very meaningful absolute numbers as well. The other thing, when you talk about retail margin and consolidated margin, is that the fourth quarter is built into that margin, so it has affected our annual margin. If we had a normal fourth quarter, and we're very happy to see that we have a very strong first quarter, so eventually the fourth quarter will be a thing of the past, but if you had had a normal fourth quarter, the consolidated margin would have been probably grown maybe 10 basis points or something like that. W e were on that track. But still, regardless of what happened in the fourth quarter and all those headwinds, I think it was an amazing number to have. T he other aspect is that even in a soft quarter, we advanced a lot from the strategic viewpoint. We had 90 basis points market share gain in that quarter. Digital reached nearly 17% of retail penetration. We kept strengthening the other engagement bonds, things like private label, for example. We are, according to IQVIA, today RD Brands is one of the top 20 consumer health businesses in Brazil. It's not only HPC. It's HPC plus OTC. It's consumer health. It's more than HPC, and NEEDS is the number 4 brand in the whole consumer health universe in Brazil. NEEDS is only behind Pampers, Rexona, and Dorflex. These are brands that are mega brands who have been around for many decades, who spend hundreds of millions of reais a year in advertisement, and yet we have built inside the company, almost without any advertising, the number 4 consumer health brand overall in Brazil. Our private label business is more than the sum of every other drugstore's retail business, and this is a business that had 47% of gross margin, helping us not only give better deal to our customer but also improve the margin of the store. The gross profit per unit of private label is about 20%-25% higher than the gross profit per unit of a national brand. So, this is the financial aspect, but when you talk about this as an engagement bond, it's because private label is making our customers more loyal, and we measure that. People who buy private label, they increase their share of wallet, because they see the value, and this is only that only Raia Drogasil offers. Stix is another very important engagement bond. This is a partnership we've started with Pão de Açúcar. It was not obvious in the beginning, only Pão de Açúcar and us. We have both amazing operations combined in São Paulo, but there are markets where Pão de Açúcar is not, and there is only Raia Drogasil. We are we are very happy to see how Stix has evolved. Today is not only RD and GPA. We have C&A. We have Sodimac. We have a partnership with Livelo. Livelo is the number one loyalty program of any kind in Brazil with more than 40 million members, and any member who who has points in Livelo, either because of the airline or because of the credit card, whatever that is, they can go to our stores and use those points in the cashier through PagStix to pay for their purchases. A s a result of Livelo, in the final months of the year, when Livelo entered, we have more than doubled the number of points redeemed, on Raia Drogasil and on the other members of the program. We are now we have now just signed another member. I cannot disclose who the company is, but we're talking about another reference company for Stix. We're talking about a new vertical that was not well explained. So, Stix is becoming something very, very important, and we measure that those Livelo customers who spent Livelo points to pay on the cashier on the coming months, they spent more than before. So, it's another engagement bond, another drive of customer lifetime value. We're healthcare is another, LTV driver is another engagement bond driver. People who do health services with us, they become more loyal and then spend more because of that. So, we are advancing a lot on those value drivers that in the end translate on higher comps, higher margins, etc. When we look to the future, we are still very we are very, very optimistic, first because we operate in a unique market. This is a we are seeing in Brazil 1 million more seniors in the market every year, and this will be true to the very least until 2050. So, from 2024, 2050, every year, 1 million more seniors than the year before. So, this is a contracted, market growth of a huge magnitude, and this is a very secular phenomenon that the market is experiencing. We have only 16% of market share and huge potential to increase that market share through same-store sales growth and through the expansion that is, operating with 25% real interest rates, net of cannibalization. When we look how we are in this amazing industry, the gap we have today versus our competitors is already huge and is increasing every year. The BRL 5.5 billion we added in revenues, I mean, it's the size of the fifth largest retailer in Brazil, and we're doing this organically paying 2x EBITDA. The number two player in Brazil is 40% of our size today. When you think in terms of five years on the road, 10 years on the road, that scale gain will be much, much higher than the scale difference will be much, much higher than it is today. And scale is important, but it's only half of the story. The other half is store efficiency. We have BRL 1.1 million per mature store. Nobody has that. This means that we have expense dilution bigger than anyone else. We can, at the same time, provide a better experience to the customer and have a higher margin and be cheaper for that customer. The combination of scale and efficiency, then it's something completely different. When you look what, where we'll be with this superior combination of efficiency and scale, which is expanding year by year in 5 years, in 7 years, in 10 years, I mean, I think we will live through a reality that is completely different from what we have seen in the past. We keep very optimistic. The business is very strong structurally, and I think the best is really ahead. Thank you all for attending the call, and thanks especially for our long-term shareholders for your long-term support. Bye-bye. RD's conference call is now over. We thank you all for participating and wish everyone a good day.