Good morning. Welcome to the WEG conference call to release results for the second quarter, 2023. We are broadcasting this conference call accompanied by the slides at our investor relations site at ri.weg.net. After the closing, the audio will be available at our IR website. Should you require any assistance during the conference call, please request the help of an operator by pressing star 0. Any of the forecasts contained in this document or forward-looking statements that may be made during the conference call, referring to future events, the business outlook, operational goals and projections, and the potential of growth of WEG, are based on the beliefs and expectations of the WEG management, as well as on information currently available. These forward-looking statements involve risks and uncertainties and therefore depend on circumstances that may or m ay not occur. Investors should understand that overall economic conditions, industry conditions, and other operating factors could impact the future performance of WEG and lead to results that differ materially from those expressed in such forward-looking statements. We would like to remind you that this conference call is being presented in Portuguese with simultaneous translation into English. With us today in Jaraguá do Sul, we have Mr. André Luís Rodrigues, Chief Administrative and Financial Officer, André Menegueti Salgueiro, CFO and IRO, Wilson Watzko, the Controlling Director, and Felipe Scopel Hoffmann, IR Manager. Mr. André Rodrigues, you may take the floor. Good morning, everybody, it is a pleasure to be with you once again for WEG's earnings conference call. I start with the highlights of the quarter, where net operating revenue grew 13.7% compared to the second quarter of 2022. We posted another quarter of growth, reflecting the good performance of the long cycle business and our good demand for the products in the main regions where we operate. In Brazil, we continued to perform positively with good demand for industrial equipment. In long cycle equipment, we saw good sales volume, especially in the transmission and distribution business. In the external market, the GTD business contributed significantly, especially the T&D supplies in North America. We also observed good results in the other markets of operation, mainly in the mining and oil and gas segments. In the industrial, electric, and electronic equipment area, EBITDA reached BRL 1.8 billion, with an increase of 45.9% compared to the 2Q of 2022. The EBITDA margin ended the quarter with a growth of 4.9%, a 22.4% increase vis-à-vis the same period last year. Throughout the presentation, André Salgueiro will provide more details on this performance. The ROIC, as we will see in the next slide, reached 34.4%, an increase of 7.5 percentage points compared to the second quarter 2022. The improvement of our operating performance, supported by the revenue growth and enhanced margins, more than offset the increase in fixed asset investments, coupled with better control of working capital requirements in the period. I would like to give the floor to André Salgueiro. Well, thank you, André, and good morning, everyone. On slide 5, I present the evolution of the business areas in the markets where we operate. In Brazil, we continue to have a positive industrial activity with good demand for short cycle products, with an emphasis on serial automation products, mainly for the mining and pulp and paper segments. Long cycle equipment, such as medium voltage, electric motors, and automation panels, also showed good results, especially in oil and gas, mining, and pulp and paper segments. In the GTD area, we observed another quarter with good performance in the T&D business, driven by deliveries of large transformers and substations for projects linked to transmission and distribution network auctions. The distributed solar generation business, despite showing revenue growth compared to 1st quarter 2022, declined compared to the same period last year. In commercial engines and appliance, we observed improved sales in several segments, with a decrease in sales in the quarter. In paints and varnishes, we continued with a good demand in recent quarters, with an emphasis in the oil and gas and maintenance segments. In the foreign market, industrial activity remains positive in most of the regions where we operate, with an emphasis on short cycle equipment, such as low voltage, electric motors, and serial automation products, mainly in North America. For long cycle equipment, we also see good revenue levels, especially for projects in oil and gas and the mining segments. In the GTD business, we continue to enjoy positive momentum for T&D operation, with good performance in both Mexico and the U.S....In the generation business, we highlight our operation in Europe, as we delivered some important quarters this project, in addition to building a healthy order book for the coming quarters. In Commercial, engines and Appliance, we saw growth in demand for our products in important regions where we operate, especially in the U.S. operations. In paints and varnishes, revenues and overseas operations showed growth, offsetting lower export activity from Brazil in the quarter. In slide number 6, we show the evolution of EBITDA, which grew 45.9% vis-a-vis the second quarter 2022. The EBITDA margin ended the quarter at 22.4%, 4.9 percentage points higher than the same period the previous year. This result is mainly a reflection of the cost accommodation observed in the last quarters, along with a change in the product mix of products sold, mainly impacted by the drop in solar energy, better profitability of long cycle projects and foreign operations. Finally, on slide number seven, we show you the evolution of our investments. We invested BRL 445 million in this quarter, 34% in production units in Brazil, and 66% in industrial parks and other facilities abroad. In Brazil, we highlight investments in the expansion of industrial engines, electric traction, engines and battery pack factories. While abroad, we continued with the expansion of the motor and transformer factories in Mexico, with the construction of the new motor factory in Portugal, and the expansion of high voltage motor and generate factory in India. This concludes my part, and I return the floor to André. Well, before we go on to the question and answer session, I would like to refer to some of our latest achievements and comment on our outlook for the rest of the year. Regarding achievements I would like to highlight, we announced earlier this month, agreements with Alupar and 2W Ecobank for wind power self-production, which in addition to guaranteeing the supply of energy at WEG, will also contribute to achieving the decarbonization targets assumed last year. The two contracts represent 90% of energy consumption in Brazil, and together with other projects under execution in India and China, add up to 75% of our global energy consumption in 2022 from renewable sources. We recently announced investments to expand the production capacity of the Manaus plant. The BRL 48 million project will be carried out over the next three years, and will enable the production of a new line of electric motors for air conditioners. In June, we were among the top three in the Broadcast Companies Award, presented by Agência Estado. As companies that most generated value for shareholders, we also received a special award in the sustainability category. Finally, I would like to speak about the outlook for the rest of the year. We continue with a good order backlog for long cycle equipment, both in the industrial area and GTD, especially in the T&D projects, which will be a key part of our business, both in Brazil and abroad. We continue with a positive dynamic, controlling the price of our main raw materials and with a favorable evolution of cost. We should be able to grow sustainably. It is important to be attentive to the global macroeconomic scenario and the potential risks for our operations. Despite this, we do maintain our forecast for sustainable growth and a positive demand for most of our businesses. With this, I would like to end the presentation. Operator, we can now continue on with the question and answer session. Ladies and gentlemen, we will now go on to the question and answer session. Should you wish to pose a question, please press star one. To withdraw your question from the queue, press star two. Please hold while we poll for questions. Our first question comes from Lucas Laghi, from XP Investimentos. You may proceed, sir. Good morning to all of you, and thank you for another call. I would like to hear a bit more about your revenue dynamic. I would like to hear about this geography. By geography, you have had consistent growth, year-over-year, but I think that the exchange rate ended up not being of any help in that sense. What is it that you foresee therefore, especially in terms of costs? If you could look at that creation of backlog, what you can explain to us semester by semester? Well, you said that this already reflects the strategy, that you have the commercial strategy. If we look at the domestic market, we see what is happening with these solar distribution. What will happen if we have a somewhat more active market? Will there be a one-time concentration of wind deliveries because of this, or what is it that you are hoping? Thank you. After that, I would like to pose some additional questions. Good morning, and thank you so much for your question. You did approach several points here. I will try to cover them all. Should I have forgotten something, please remind me of this in your follow-up. In terms of industrial electro electronic equipment, Brazil continues to have very positive performance. We had a growth of 15.1% compared to the last quarter. The dynamic continues to be positive, and we see that we have a very good occupation in this sense. For the long cycle projects, especially automation panels in oil and gas, continue to be very positive areas, and they are supporting our growth in Brazil. When we look at these businesses outside of Brazil, they have continued to grow at a lower rate, perhaps 7.3%. There is no impact of the exchange rate. It's what we had mentioned. In most of the regions, our sales continue to be positive, but in some areas we begin to feel signs of volatility, especially in Europe, where we have observed signs of volatility for some time already, especially in the long cycle in Europe, with volatility in the last quarters. In this last quarter, we had a dynamic in China with a certain drop, and this has also contributed to this somewhat lower growth in this business unit outside of Brazil. When we think of the GTD sector, the significant factor continues to be solar energy, although it has showed a minor evolution compared to the first quarter, this does represent a slight drop. What refers to the first quarter is due to the concentration of the delivery of wind equipment, and the first quarter is always this way because of the timing, because this is when we have a concentration of our projects. Regarding the second quarter, last year, the impact is greater when it comes to the fall of the solar area, as also happened in this quarter. To close, regarding the more volatile demand that you have in Europe, there is a positive highlight at the end of the second quarter. Can we say that in Europe, although this equipment has been the main component of your revenues, what is it that has increased your revenues in Europe this quarter? Do you see any new signs of any improvement in the situation in Europe in general? Thank you very much. Well, regarding Europe has had a very significant performance this year with the resumption of growth in regions outside of Brazil. All of this growth is concentrated in the GTD area. There are some very important projects when it comes to generation in Europe now for the second half of the year. Most of the revenues end up coming from Europe because of Gefran and of course, compared to the base in the past, this will be of great help to growth when we think about the region. This great highlight in Europe is linked to these two highlights. First of all, generation as part of GTD, and secondly, this is also due to Gefran, the acquisition. Thank you. Thank you very much. The second question comes from Andre Mazini, from Citi. You may proceed, sir. Good morning, thank you for the call, and congratulations for your results. I have a question on the recall that became very relevant in the media approximately three months ago in terms of aero generators. What is going to happen in the market? For you, a recall of this type, does it open up more room for other strategies, a greater diversification because of the loss of reputation? What has led to a recall of this sort? Will people buy from third parties? If you have made any changes, if you're looking inwards now that the reality has changed completely, can you understand something more because of this external event when it comes to your company? Thank you very much. Well, hello, Andre. This is André Rodrigues, and thank you for the question. We do not have information on the supply, nothing above and beyond what has been disseminated. Of course, we cannot take a positioning when it comes to issues of the competition. When we're speaking about aero generators, we're referring to highly complex equipment. The installation is very complex as well, and as happened with this specific competitor, well, there are problems eventually with other competitors as well, and these one-time problems in these machines, yes, of course, can occur. In the case of WEG, we're not aware of pro blems in our serial equipment. Of course, there is a risk, but we have a lower exposure when it comes to the total revenue of the company. Thank you. Thank you very much, André, for the answer. Our next question comes from Regis Cardoso from Credit Suisse. You may proceed, sir. Good morning, Salgueiro Rodrigues. We have two questions at our end. First of all, to understand the dynamic of revenues, you had a positive balance in the top line in the quarter-on-quarter comparison. This has drawn attention. We thought that because of the appreciation of the BRL and because of the accommodation of commodities in general, especially steel, with a certain reduction, that all of this would be a headwind against the growth of revenues. Now, the question is the following: If you have had any type of concentration in the delivery of projects of GTD in the external market, and there is a growth in revenues during the second quarter, is this recurrent? Is this a good proxy to be able to forecast the growth of future quarters, or is there a commercial environment, a more favorable demand, that will allow us to see a stronger top-line trend? Perhaps you could also remark on the growth of the top line and the division between volume and price. I later have some additional questions. Thank you. Good morning, Regis. This is Salgueiro, and thank you for your question. When it comes to the dynamic of revenues, I can give you an initial response. In GTD, in the external market, yes, we did have a concentration of some important projects, especially for generation in Europe. Part of the revenues of this quarter will not appear in our portfolio with the same magnitude when it comes to delivery in coming quarters, of course, this is natural. We should recall the long cycle dynamic. Sometimes we're producing, the concentration may take place in the delivery in one quarter or another. This may happen one or another time, I can state that part of this performance, therefore, is to the performance of Europe because of this concentration. To convey information that we usually share with you, the break in the short cycle, this quarter, it reached 46%, this was an important evolution. It shows that this evolution is fully aligned with what we have been going on through the last quarters, the long cycle portfolio. As this portfolio evolves, well, these concentrations may end up happening. When it comes to the breakdown of volume and price at WEG, it is very difficult to work with that breakdown because we have a large series of products with different forms, motors with different sizes and power. Therefore, it's somewhat difficult to work with this analysis in a consolidated way. We did not have variations in price vis-a-vis last year, and most of our growth and performance are based on higher volumes. Well, thank you. If we think of the logic of margin evolution, the stronger margin for the second quarter, had this evolution because of a concentration of long cycle, products of GTD, abroad, and it may not be recurrent in future quarters, or is this due to a dynamic of a fall of costs? The prices remain normal. Will this be sustainable, or could this be something temporary, because of the price and cost conditions? I simply would like to understand the recurrence of these margins, if possible. Regis, this is André Rodrigues here. First of all, to speak about the future, we need to speak about what happened in this second quarter. The margin evolutions in this second quarter, are due to some of the factors we had already announced. The change of cost of some raw material, a different product mix with a different profile. All of this can also have an impact on one quarter vis-a-vis another. The delivery, the portfolio for long cycle and the exposure of our business with solar and wind, that predominantly tends to have lower margins, but also contributed, was a better occupation of our plants and our operations overseas. We have several initiatives underway to enhance profitability abroad. That idea of the representativeness of the long cycle, this is also very important, and throughout the year 2022, we did mention that we had price recompositions, enhancing the margins of long cycle products. For the WEG dynamic, because of these variations that we have between one quarter and another, it's very difficult to say that the margin of a specific quarter will be recurrent. What is important here, and we do want to think about margins. We have delivered one more quarter with a margin that sets itself aside. For the year, we have the expectation that the performance will be better compared to other years. We could never say that a specific margin of a quarter will become a benchmark for other quarters. Well, thank you. Thank you very much, Salgueiro and Rodrigues, and thank you for the call. Our next question comes from Lucas Marquiori, from BTG Pactual. You may proceed, sir. Good morning, and thank you for the call. We have two questions at our end. I'm going to refer to the theme you mentioned in your last answer, referring to the competitor this morning. It seems that the situation of margins in this segment is a reflection of what is happening globally because of commodities. I'm somewhat concerned with the pricing in this case, that the pricing has not been as efficient as it should be under these market conditions, that perhaps you should transfer some of these changes in the prices of commodities. I would like to know what is happening, especially in exported products, more competitive products in Europe, if there should be some sort of price accommodation. This is my first question. The second question, very brief. I have understood the accommodation of prices in commodities and what has happened with margins, a margin enhancement overseas, especially in Mexico and perhaps one or another operation overseas. If you could qualify, in which of the operations you're ramping up our margins with a greater speed? Well, thank you for the question. Regarding pricing, readjustment, of course, can be made in accordance to market conditions. We carry out price increases and readjustment at the beginning of the year to offset these increases that tend to appear. The last month, and this year specifically, the price increases occurred precisely because of this trend that we observe in raw material. Pricing does not have very much to do with demand. While demand is very active, we are able to work with a specific level of prices, and up to this moment, with exception of some adjustments that have been put in place, we have been able to maintain that level of pricing. We're going to have to follow up on what happens going towards the future. The improvements in the margins, these have happened in a very general way in all of our business units. It's one of our objectives to enhance our margins. Well, the example of P&D in the Americas as a whole, we had always informed you that we're working with margin enhancement, with the synergies in the operations of the US, and to have gains, and of course, this can happen. We also have a better occupation of our facilities, and we see this in China, which is well, we had the shutdown because of the pandemic, especially in the second semester. We had a drop, vis-a-vis the first half of 2022, there was an impact on margin. With the resumption of the conditions of demand, this also aids and abets our company, Gefran as well, had an improvement in margin during this first half of the year. Very good. Thank you very much. The next question comes from Bruno Amorim from Goldman Sachs. You may proceed, sir. Good morning to all of you, thank you for taking my question. I have a follow-up on that discussion of dynamic and margin evolution, focusing more on the cost side. For some quarters already, we are living with lower prices in raw material and commodities, I would like to know if all of the benefits of this have been reflected in your cost in the second quarter because of the hedges or your raw material inventories, or are there incremental benefits going forward? If you could also remind us on the hedge policy of the company, which is the status of the hedge that you're using in your portfolios at present. Thank you. Well, Bruno, in a certain way, yes, it has been reflected, it will depend on the dynamic going forward on what happens with the price of commodities. When it comes to the hedges for the main raw material, yes, we of course, do work with protection for the prices and long cycle projects. Each case, each contract will have its specific rules. The company has worked on this for some time already. Well, thank you. The next question comes from Rogerio Araujo from Bank of America. You may proceed, sir. Hey, good morning, and thank you for taking my question. I would like to speak further about the P&D segment in the United States, if there has been a revenue evolution and margin evolution in this second quarter that can help explain the external GTD. Looking forward, if you could speak about the very strong demand forecast that we have in coming years because of the evolution of renewable energy, which is the outlook of supply for the big facilities, which is your capacity, if you have expansion projects. I am aware that you have already worked with three expansions in the last few years, but do you have plans to further expand your capacity and pricing as well? Is there room to enhance this segment? Thank you very much. Rogerio, when it comes to demand, yes, the demand is very positive, and everything that we do in our surveys and the positioning of our customers show that this is not just a short-term demand. Yes, this demand for P&D equipment in the North America will continue in the middle and long run, and because of this, the company has been preparing itself for some time. We began with the facilities in Mexico. In the past, we felt that at some point in time, this demand would become stronger in the United States, and of course, this demanded significant changes from MEGA in the cities of Washington, D.C. and Missouri. We imagined that this demand would come in 2020. In 2021, we inaugurated a third unit in the same city, and at this point in time, in the United States, we're concluding an expansion in one of our existing facilities. Additionally to this, what we have done in the United States is to work on the synergy that we have in operations with Mexico. Of course, we have better labor, and it's possible to produce some components in Mexico and send them to the United States for the conclusion, the finishing of the equipment as a whole. We're also working on a capacity expansion in Mexico to face up to this demand. We have investments that are underway, and to continue on with this, we also have some surveys to enhance this capacity, especially in Mexico, to be able to comply with new demands in that sector. This, of course, is very positive news for us. Thank you very much. Has the second quarter been of help? Have you had an evolution quarter on quarter? Yes, it has been of help. Thank you. Thank you very much. The next question comes from Andressa Varotto from UBS. You may proceed. Good morning. Andressa and others, for taking my question. I have two very quick questions here. We begin to observe a recovery of this segment and some new projects for generation, and the drop in interest rate should aid in a bit this sector. There is a new regulatory law, and I would like to know if you have any update regarding expectations on the next few months. Thank you, Andressa, much for the questions. When it comes to solar generation as a whole, we mentioned at the beginning that all of this had a growth on GTD in Brazil because the solar generation had a drop since last year. This drop is more concentrated in GTD, distributed generation. This is a segment that is suffering more because of these regulatory changes and because of the increase in interest rates and the credit crunch that Brazil has suffered in the last few months. This has impacted the movement of this in the last few quarters. When we look at the solar business as a whole, solar distribution has grown vis-a-vis last year and has become relevant. This growth in central solar generation is helping us to think about the weaker performance in distributed generation. The central solar generation should continue to evolve. We should have significant changes during the second half. In terms of GD, we do expect some evolution during the year, but in the coming months, we're going to depend on how this evolution will take place. This business is working a bit laterally with an evolution month after month. Of course, there is a drop in interest rates. There will be a reflection on the consumer that will have greater activity. Most of the equipment is already part of the system. When we put all of this into an analysis, we do think there will be a resumption, but when we look at the numbers, we truly do not know how the second half of the year will be. Regarding the rule of the transfer price 1,152, there's a great deal to update vis-a-vis what we said in the last quarter. There is a new methodology, transfer price, plus other factors. Presently, we're concluding studies to compare margins with outside consultants to have a more precise information on which will be the impact of this. In the coming months, we should have more updated information. Well, thank you. Thank you very much. Next question comes from Victor Mizusaki, from Bradesco BBI. You may proceed, sir. Hey, good morning, and congratulations for your results. I have two questions. The first, if you could speak about the transmission area at the end of June, if you already have your partnership signed, and the bids for suppliers, of course, these will take longer to take place. The second question, we are following up on the discussion of a positive incentive in the white line in white appliances. How would this affect you? Thank you very much. Thank you for the questions, Victor. Regarding the transmission auction, we had an auction that was held recently with BRL 16 billion of investments. WEG did not have a pre-contract with the participants at the auction. What we were able to observe is that most of the project lots did not have signed pre-contracts. This means that many of them are still open in the market, and it is natural that beginning now, we will be able to work closer with those who won the bids and initiate a commercial conversation. We are more aligned with some of the winners of this auction. To put this in context, this is the first auction. There's a forecast for a second auction at the end of the year, and a third auction that had also been forecast for this year, but has been postponed for 2024. When we put together all of the investments of these three auctions, the expectation for investments will be quite expressive, this is a boost to continue developing the T&D business in Brazil in the coming years. Now, the timing of these projects for implementation is normally five years, the purchase of equipment can take place in the first, second, or third year, according to the progress of each project. Of course, we hope all of this will materialize. Regarding the white line appliances, in the commercial part, we have seen an evolution of revenue, especially in Brazil, vis-à-vis last year. Last year was a difficult year for that segment. We have observed some growth, but we can't say that there has been a more recent program disseminated by the government. If, in fact, this materializes, it will represent an additional opportunity in this market and a greater opportunity for growth for the company in that business line. Thank you very much. Our next question comes from Daniel Gasparete from Itaú BBA. You may proceed, sir. Good morning, everybody, and thank you for taking my question. I have two as well. I would like to go back to the long cycle comment. I think that the representativity of this segment has become very clear. I would like to know, which is the evolution of this? I imagine that the contracts will be made at higher costs. Now, André made a comment that you have a delivery at the end of the year. I would like to know if you're forecasting a level of margins that is similar to what you have had, or if you will have a new cost and price structure for the long cycle product. Secondly, to speak about solar energy and the representativity of central distributed energy compared to TP. The central area has a higher margin distribution. Will this continue on this way, or is there another factor that could modify or change your margin levels in this case? Gasparete, thank you for the question. When we speak about the long cycle, it will depend on each different business. We don't have a single rule. Why? Because in some cases and some businesses, we use different formulas to set forth a contract with the customer, to set forth the price. That price in the contract already has a formula that eventual operations, whether upwards or downwards, will be transferred to the price. We have other contracts, other businesses, where we basically sell based on everything indexed to inflation and the variation of other costs. As André mentioned in the initial response, in some cases, depending on the time of the contract, we could also use a hedge structure for protection for raw material or exchange rate. As a rule, everything will depend on the business per se, that we're dealing with. Now, let's speak about the long cycle as a whole, and there is a component that defines the contract and the pricing for the customer. If we have a dynamic of reduction of drop, we can generate better margins than the margins we had expected from that contract, and the same holds true. If we have a contract, if we have an increase in our cost structures, the margins generated can be somewhat worse, of course, than what we had expected. Nowadays, we're living through this dynamic. On the average, many of the contracts we have were signed last year, where the cost structure was higher, and this enables us to have an impact on our margins. Presently, we're normalizing everything based on the present-day cost structure. Until the delivery of the projects, there will be minor variations. They should be considered stable, but everything will depend on the cost structure and the evolution going forward. Regarding the solar business, when we look at GD compared to GDP and profitability, in GC, the margin profile is somewhat lower, more comparable to the wind generation business, and the company works with integrators, and the profitability in that case tends to be lower. As a counterpoint that we always mention, although the margins are somewhat lower, they're interesting from the viewpoint of invested capital, and we are interested in developing that business, of course. That was very clear. Thank you very much. Have a good day. Our next question comes from Igor Araujo, from Genial Investimentos. You may proceed, sir. Good morning, everybody. Congratulations for your results. You have shown the good work that you're carrying out. I had several questions I had set aside. You have referred to most of them, these will be follow-ups, basically. In P&D, I would like to know if our calculations make sense. You referred to BRL 50 million in the coming months, you will be making in investments, we use 15% of these investments here to substations for transmission. Does this make sense? I have another two questions, one related to the oil and gas sector. The sector has performed very strongly, we have verified this through the entities, which are the great destinations for exports, for you specifically? The third question, also speaking about the backlog and the rupture of your backlog, can you give us a vision of which will be that breakdown between long cycle and short cycle in the coming 12 months? I know that this is very difficult to do, with the portfolio that you have at present, perhaps you can give us a clear direction. Thank you very much. Hello, Ygor. Thank you for the questions. When it comes to the auctions, it's very difficult to speak about a share. This will depend on the size of the project, perhaps we only sell the equipment for transformers as part of a package. If it is, it could be another turnkey project where we're going to work with a substation. What we see in the market, it's very close to the figure that you propose, perhaps somewhat below that. It's difficult to give you a specific figure because of the different dynamic of each project and each lot that was part of the auction. We don't know if we will only be selling the equipment or if we will have a turnkey project for the substations. When it comes to the oil and gas segment, this is a market that is quite dynamic at present, and we have a dedicated team looking at the opportunities in that sector. In Brazil, we're making investments because of the pre-sal exploration. It's important to underscore that oftentimes, the project is in Brazil, can be in Brazil, but the sale will not necessarily be done in Brazil. It could be done in Europe, where we're going to sell to a shipbuilder in Asia, and then that platform will be brought for operation here in Brazil. We have the shale gas industry that continues to have a positive demand and is very dynamic. We have other projects in the Middle East and the north of Africa as well, where we have obtained good contracts in the last few quarters. Now, in terms of the share for the long and short cycles, it's very difficult to estimate this going forward. What we see is that long cycle is gaining relevance in the last few quarters. It's 46% at present, the highest level in the last few years. The long cycle portfolio continues to be positive. We see activity in some regions for the short cycle. In the very short term, there shouldn't be a significant change. If we look at the mid and long terms, the more natural breakdown, a breakdown that we see historically, would be something closer to 60/40, 35/65. Everything will depend on the quarter. Well, thank you, André, and once again, congratulations for your results. The next question comes from Marcelo Motta from JPMorgan. You may proceed, sir. Good morning. Two questions at our end, referring to margins. Is there still a positive contribution for WEG? What is it that you can say about this, and the same regarding P&D in North America? Now, in Mexico, as you have enhanced capacity, are you at the point where you could be or, is there still potential for enhancing margins in the coming quarters? Thank you. Marcelo, thank you for the question. Regarding these two specific units, the T&D part in North America, well, with these increases in capacity and with the occupation of the facilities, the plants, I think we're operating at a very satisfactory margin level. Of course, WEG will always work with efficiency programs, cost control programs, but the work is well advanced there. Now, Gefran, which is a recent acquisition, is a smaller companies compared to the T&D businesses in North America. Everything will depend how much we're able to grow in this business, and the growth, of course, could bring us an enhancement in our margin structure as it stands at present. In terms of the planned occupation of some operations, we can say that we're at a satisfactory margin level. Remind you, of course, that Gefran, since the acquisition, has already benefited from the WEG chain of supply structure. It is a company that did not have the size of WEG, and it has become part of the big contract, and we now have a more advantageous position when it comes to negotiating with suppliers. Well, thank you. Thank you very much. At this point, we would like to conclude our question and answer session. I will return the floor to Mr. André Rodrigues for his closing remarks. You may proceed, Mr. Rodrigues. Once again, I would like to thank all of you for your participation in our conference call. I wish you a good end of the week, and I do hope to see you once again at our next earnings release in the third quarter 2023. The WEG conference call ends here. We would like to thank all of you for your attendance. Have a very good day.