Good day, ladies and gentlemen, and welcome to Falabella Earnings Call. My name is Gigi, and I'll be your coordinator for today. At this time, all participants are in a listen only mode. In the first part, Mr. Raimundo Monge, Head of Investor Relations, will present a summary of the consolidated results for the second quarters of 2023. Mr. Juan Manuel Matheu, Chief Executive Officer of Falabella Financiero, will update the digital banking business strategy. We will open the line for questions. If you would like to participate in this part of the call, please press star 11 at any time during the conference. We'll start with the conference with Mr. Raimundo Monge. Thank you, Gigi. Good afternoon, everyone, and welcome to Falabella's second quarter 2023 earnings call. Joining me today are Gastón Bottazzini, our CEO, Juan Manuel Matheu, our Financial Service CEO, and Alejandro González, our CFO. I would like to remind you that numbers presented during the call will be according to IFRS rules expressed in U.S. dollars and rounded to millions. Therefore, certain small difference may arise with the published financial statement. I will start the call by going over some key operational highlights of our physical digital ecosystem. Let us begin reviewing from slide 3 onwards. The slowdown in consumption and high inflation levels continued to impact our operations. In the case of our retailers, the businesses that were impacted more were home improvement and department store in Chile and department stores in Colombia. The consolidated revenues of department stores decreased 18% year-over-year. Electro category experienced the largest drop in sales versus the previous year, both in the physical channel and in the online channel. In home improvement, consolidated revenues reached $1.4 billion, a decrease of 21%, mainly explained by a contraction in pro-products categories associated with construction in the region. Supermarket decreased 4%, reaching $633 million. Non-food categories continued their downward trend, reducing their participation at safe level. Mallplaza revenue reached $128 million, an increase of 16% due higher occupancy rate and the indexation to the UF. During the second quarter, online GMV decreased 15%, while our 3P online sales grew 2%, representing now 25% of total online GMV. Overall, our e-commerce platform achieved $3.2 million in GMV during the last twelve months. Consolidated revenues decreased 13% year-over-year, mainly due to the decline in home improvement and department stores in Chile and department stores in Colombia. The financial service revenues increased 3% over the period. Gross margin decreased 17% year-over-year, mainly explained by home improvement Chile, which declined 22% year-over-year, despite higher gross margins due to lower sales volume, mainly explained, as we already mentioned, by the decline in the construction sector. Department stores decreased 24% year-over-year, mainly due to lower revenues in the region, coupled with a decrease in gross margin in Peru and Colombia, partially offset by an improvement in the case of Chile. The banking business declined 28% due to the increase in risk exposure and funding costs, mainly from the banking business in Colombia. The bank margin in Chile improved compared to the first quarter of 2023. I would like to highlight that the inventory normalization process that has allowed us to reduce them by 22% year-over-year and 6% since March of this year. In terms of EBITDA, it fell 42% year-over-year, reaching $176 million. Our SG&A expenses have decreased 8% year-over-year, despite an environment of high inflation in the region, thanks to the reduction in logistics, the optimization of our marketing customer loyalty campaigns and personal expenses excluding severance payments. We would like to highlight that we have successfully completed the execution of the efficiency plan that we launched in October of 2022. In a more challenging than anticipated environment, we have intensified the efforts towards restoring our profitability by adding new initiatives to the plan. This quarter, and in line with the industry practices, we have adopted a fair value valuation model for our investment properties, which had a net impact of $108 million on Falabella. We believe that this will more appropriately respect the equity and economic situation of our real estate business, and therefore of Falabella. Given all the above, we closed the quarter with a profit of $661 million. Finally, as far as our financial position, we would like to highlight that we have no relevant maturities until January 2025. I would like now to leave you with Juan Manuel Matheu, our Financial Services CEO. Thank you, Raimundo. Good afternoon, thank you everyone for joining us today. In the financial business, we continue advancing in our goal of becoming the main digital bank in the Andean region. Our value proposition is based on up-first customer journeys. That's a core characteristic of digital bank, in our case, strengthened by a comprehensive set of benefits that include discounts both inside and outside our ecosystem, the favorite loyalty program of the Andean region, CMR Puntos. We reached 7.3 million active customers, that is a 7% increase year-on-year, $5.8 billion in purchases with our means of payment, that is a 4% increase year-on-year. Reflecting that our customers prefer our value proposition based on digitization and benefits of our loyalty program, despite a more restrictive environment in credit origination due to risk levels. I like to highlight that our TPV out of the ecosystem already represents 70% of total volume and growth. This shows that our customers are increasingly adopting our credit and debit cards as their preferred payment method. In terms of financial performance, the bank in Chile is recovering quarter by quarter, stabilizing the risk levels of the portfolio. Our 10 priorities are, first, to continue strengthening our digital value proposition, improving the experience, and thus continuing to deepen the relationship with our customers. Second, continue our efforts to allow us to control the risk of our portfolio and strengthen our collection capacity. Third, drive profitability, keeping our value proposition attractive for our customers. Going forward, we expect a significant increase in the bottom line in the second half of the year. This improvement will be driven by a lower cost of risk and a slow decrease in funding cost. In contrast, we expect a decrease in our income as a result of more restrictive credit policies that will slightly reduce our total loan portfolio. The active participants in our loyalty program reached 18.6 million across the region, with over 2.3 million redemptions during the second quarter. The program is a key pillar for transforming our organization into a data-driven one. Finally, I would like to refer to the situation on Fpay. In 2020, we set out to be the essential payment solution for our customers and businesses. Today, we have a presence in three countries with more than 4.5 million customers and $706,000 quarterly TPV. Since then, the market conditions and customer needs have changed, resulting in a sharp decrease in profitability of pure wallets and a demand for a broader financial portfolio. Most of wallets are broadening their services or turning into digital banks. Our bank is successfully transforming into a digital bank. In the case of Chile, we believe that we will soon be the first bank in personal checking accounts. In this context, we decided that the functionalities of Fpay Digital Wallet will be integrated into the Banco Falabella application and focus Fpay business on the processing of payments for Falabella's e-commerce, falabella.com marketplace. We believe that with this, we will be able to provide a better solution to our clients and also make the Falabella operation more efficient, with annual savings of $30 million in EBITDA next year. Now we will open the line for questions. Ladies and gentlemen, we are ready to open the lines up for your questions. If you wish to ask a question, please press star followed by one on your touch tone telephone. If your question has been answered or you wish to withdraw your question, please press star followed by one again. Again, press star one to ask a question. Please stand by for your first question. One moment for our first question. Our first question comes from the line of Antonio Hernandez from Barclays. Hi. Good morning. Thanks for taking our question. Well actually two quick ones. First, any update on how you're seeing the asset monetization strategy, particularly leveraging? I know you briefly mentioned that in the last conference call and given the results, if you would like, that you could provide on that. The second question would be regarding how are things shaping up in the first two months of the third quarter? Are you seeing any improvement in terms of consumption, either in specific region or specific format? Thanks. Hi, Antonio. We didn't hear you well the first question. Can you repeat it, please? Sure. First question regarding any specific strategy that you that you're considering for either asset monetization or anything else that could help in terms of the leveraging because of the increasing net debt EBITDA metric. Hi, Antonio. This is Alejandro. If I heard correctly, because apologies, but the message is not getting here that clearly. I understand that you were asking about the real estate, the land bank, the real estate assets that we mentioned that we were working on. What I can tell you is that we've already launched a process of monetizing a group of real estate assets in the range of $300 million-$400 million. Basically, we're talking about standalone stores and some distribution centers, mainly in Chile. On top of that, we've already launched the sale of what used to be the headquarter, the offices of Sodimac in Chile. That, those are processes that should be basically materialized within, given the demand that we've seen in the market, within, I would say, fourth quarter this year, first quarter next year. Thank you. One moment. I'm sorry, Antonio, I think you had a second question. I also had trouble figuring out whether you were asking about online GMV and the decline of online GMV or what was the exact question? The second question is around how you see performance over for these two quarters of the three... two months and third quarter in terms of any consumption trend improving and where specifically in terms of format and region. Thanks. Okay. Let me again repeat because the clarity of the line is not very, is not great. What I'm understanding is you are asking about what we are seeing in terms of commercial performance in our retail segments. I would say that we were seeing in the beginning of the third quarter is still consistent with what we have seen in the first quarters in terms of demand. We are not seeing a turnaround on demand yet, although we are seeing some of the macro signals that would point towards a turn in demand. Mainly, a drop in inflation, stable employment levels. And as a result of that, we do expect that to start happening. Given that we are not seeing it in the market, we have taken a set of measures to counter value that. The first one, of course, is a much better inventory position. We have a 22% lower stock year-over-year, which would bring us lower margin pressure. We already have lower margin pressures. If you look at our gross margins, they are dropping mostly as a result of top line pressure. The gross margins themselves are actually getting better, and we are seeing those continuing to get better throughout the second. Sorry, the first half of the third quarter. In addition to that, we are taking a set of additional measures having to do with store closures. We already closed one store. We are closing a second store in Chile, in Mallplaza Alameda, and in October, Mallplaza Sur. We have made some investments in rebalancing the presence of different categories in the stores themselves, given that the more relevant drop in demand is coming from electronics, and therefore, giving more space to higher margin products and also products that are having higher demand, such as, in general, soft goods, but in particular, apparel. Okay. Perfect. Thanks, Nicolas. Have a nice day. Thank you. One moment for our next question. Our next question comes from the line of Nicolas Riva from Bank of America. Thanks very much for the chance to ask questions. Hi, Gastón, and hi, Alejandro. My question is a follow-up on the prior question about some asset sales to reduce your leverage. I do appreciate that response that you gave. It appears to me that unfortunately, $300 million-$400 million is not gonna cut it in the sense that it's not transformational enough. In your retail business, you have total debt of about $7 billion. Your annual EBITDA is running at about $800 million. Your net leverage right now is about nine times. It appears to me that something more transformational should potentially involve. I wanted to ask you if you would consider selling a stake in your shopping mall business. For example, right now, you start, I think, reporting the accounting for that, for that business using market values. You have five and a half million dollars in asset value of that business. I wanted to ask also how much debt is associated with that business. I count about one and a half million dollars. The question would be, would you consider something more transformational like that? Like for example, selling a stake in DistriMore business? Even, you have banks in three countries. I understand the bank in Chile is very large. That's our largest consumer lender in the country. The book value of the bank in Colombia is another roughly $200 million. The book value of the bank in Peru is another $200 million, roughly. Is that business core as well? I mean, the bank in Peru and Colombia, would you consider doing that to reduce your leverage? And essentially really to be able to retain the IG ratings? Thanks very much. Nicolás, thank you for the question. To answer your question, of course, we agree that the $300 million-$400 million that Alejandro mentioned are not transformational in terms of changing the leverage levels. We are, in addition to that, considering other actions that we cannot disclose related to real estate. We also, in addition to that, have decreased substantially some of the investments associated with initiatives such as Fpay, which Juan Manuel already mentioned, and Fast Fuel, which we have focused completely on our grocery business. That will have an impact just in the case of Fpay of $30 million on yearly EBITDA. Each one of these adds up to continue to, you know, close the gap in terms of the overall leverage level. The real effort and focus that we are putting today is more on continuing to look for additional efficiencies, such as the one that Juan Manuel mentioned, and we have others on, in the books. Also put a lot more emphasis on this turnaround in sales. On your second question about the banking businesses in Peru and in Colombia, we even though they are much smaller businesses than the one we operate in Chile, we do see the potential given our retail presence in those two countries and given the synergies that we have effectively extracted from operating the banking business side by side with the, with all of these retail businesses. We see those two also as very strategic for the development of our, of our, business, both in Peru and in Colombia. As a matter of fact, they are very important differentiators for our customers. They're going through a difficult period, as Juan Manuel mentioned, in terms of risk levels. We are seeing those already improving in the three countries. We expect that the third and fourth quarters will be much more positive than the first and second quarters have been in those businesses. In Chile first, but also in Peru and Colombia. Thank you very much. Welcome. Thank you. One moment for our next question. Our next question comes from the line of Nicolás Larraín from JP Morgan. Hey guys. Good afternoon. Thank you for taking my question. Gastón, Alejandro, Juan Manuel. I have two, actually. The first one is on the new initiatives you mentioned in the release towards efficiency. Any idea on how much these additionally efficiencies could unlock in terms of bips in 2024 for margins? That was the first one. My second one is on the bank, maybe take an opportunity of that Juan Manuel is there to see specifically in Chile, we see that risk levels have been stabilizing. Interesting to understand how you're seeing opportunities maybe to re-accelerate a bit growth into the second half or maybe into early next year. You think it's still too early for that and we need to see a confirmation that NPLs have indeed stabilized? Thank you. Thank you, Nicolás, for your question. About the efficiency, through this when we announced this plan in October last year, when we presented that in basis points, we thought we were going to have, I would say a relatively normal year in terms of consumption, which is far from what we've been witnessing this year. That said, if you allow me, I'll take that into numbers, which is something more obviously reliable when I and more comparable in terms of... When we said, 200 basis points last year, we were basically talking about something in the range of $250 million. Through this, we finished that plan. We did some, I would say improvements and increased that size to 350, which is what we have been able to achieve this far. Something that's relevant for you to be aware of, this is something that, as we mentioned, we did finish on 2Q this year, but there's several one-offs. We didn't start the quarter with this. Finishing up the time, most of that was done towards the end of the quarter. Just for you to be aware, if you take off the extra sentences just related to this, the FC&A reduction that we presented of 8% would actually be 9%. It's 1 percentage of sales in FC&A reduction, which is what we could what% reduction, sorry, let me say. That's basically due to this. In terms of the additional measures that we've taken, we disclose some of them. Gastón mentioned about the store closures, Alameda, which was already public. We put on top of that the closure of Plaza Sur in October this year. On top of that, what Juan Manuel mentioned about Fazil, Fpay, sorry, which... Fazil, which should give us in the range of $35 million on a yearly basis. You'll see moving forward the full, I would say, execution of this efficiency plan. Please keep in mind that there are several one-offs that we had to recognize as part of the execution of this program. That's more or less the extra flavor that we're bringing. As Gastón mentioned, there are some other initiatives that we have in our mindset, but it's highly likely we'll keep adding new measures. We don't have, as we said in the first quarter call, one single efficiency, one single gold bullet. We have several, you can call them silver bullets. We're gonna keep moving into executing those. Okay. Nicolas Riva, regarding your question about NPLs and growth in our bank in Chile, what I would like to share is that in Chile, in July and August, we have seen that NPLs have already started to decrease, and we think this trend will continue during the third and fourth quarter of the year. In this context, we expect the loan portfolio to stop decreasing. We have been decreasing our loan portfolio in Chile. To the second half of the year, we expect it to stop decreasing. Of course, as you all know, in December is a cyclical month for us in terms of consumption of our credit cards, and we think that could help our loan portfolio. Perfect. Thank you very much, guys. Thank you. One moment for our next question. Our next question comes on the line of Diego Guzman from BTG Pactual. Hi. Thanks for the space for questions. You have talked a little bit about the bank, but I want to maybe focus a bit more on July results that were just released, where there was an important net income increase because of cost of risk and expenses. I would like to know if the $15 million net income that you showed in the quarter is a run rate that we can expect for the rest of the year, considering that the bank has a different size and expenses have been also treated considering the pre-pandemic comparison. Do you think this is a run rate? This can grow from this figure? Maybe what are the micro data or specific indicators that you can share with us as well? Thank you for the question. I have also another question. I don't know if maybe it's better to say it now. It's regarding the falabella.com business. We also saw a sequential improvement in the other category results where falabella.com is included. Can you maybe give us more color on how have you executed profitability measures and what to expect in the coming months in terms of results in this particular area or maybe where do you see a break even? Thank you. Okay, Diego. Regarding to your first question, we have seen that, of course, inflation in Chile is, it's starting to decrease. Also we have already seen that the impact of the initiatives that we have been doing, I would say through the last year in terms of risk mitigation, have already changed the slope in our risk expense. On the other side, as you all mentioned, we have also been working in Chile next in our ADN that has also started to change its growth. As a result of both, we think that the result that you mentioned, it is of course a turning point in the bank in Chile, and we expect during the second half of the year to results or net income to actually go higher than you just mentioned. We do think that is a change in the trend of the net income of the bank in Chile. Diego, regarding your second question, this is Gastón. As you see in the others, which is mostly, covering our falabella.com business, the improvement. That you can see there is mostly related to operational improvements in falabella.com. I'd say basically three levers, the most relevant of which is shipping recovery. We have decreased the proportion of free shipping substantially in falabella.com. We have also improved slowly, but also, you know, as a result of optimizing seller mix, et cetera, the take rate. And finally, value-added services to the sellers have also improved from around 1% of overall revenues to closer to 2%. A little lower than 2% of overall revenues in the case of the marketplace. Also the marketplace, if you take our overall GMV, which is actually increasing, our marketplace GMV or 3P GMV is increasing. That also has a better take rate than the 1P than the 1P GMV, given the volumes of the sellers, et cetera. Great. Thank you. Thank you, Gastón. Sorry, just for Juan Manuel, I think I told you $15 million in a quarter run rate, but I am talking about July results. A monthly result of $15 million for you is like a bottom and this number you expect to start increasing, right? Exactly. That's correct. Okay. Thank you for your answers. Thank you. One moment for our next question. Our next question comes from the line of Gabriela Cocio from PineBridge Investments. Hi, can you hear me well? Yes. Hello? Okay, thank you. so thank you very much for the presentation. my question is a follow-up on a previous question. So you were mentioning,.. This is about, um, the efficiency plan. So you were mentioning that the two hundred and fifty million dollars efficiency plan that you had announced last year was already implemented, uh, and, and fully implemented. So given that you've had, um, two weak con, um, consecutive quarters, I understand, and you have mentioned, uh, some of the initiatives, um, that you were implementing to further cost cut costs. But I was wondering in numbers, how much more do you, do you expect to achieve? $250 million already implemented, and with all the new initiatives that are several, more than one and some bigger than others, but overall, how much more do you expect to achieve in savings, in annual savings? Hi, Gabriela. For your question, just to be precise, what I said the plan initially was for $250. What we ended up achieving is $350. Mm-hmm. We are today in the process of basically, as I said before, focusing on other issues which may probably not have much of a further impact in SG&A. There's gonna be some other initiatives we'll have, but I wouldn't say that they're that material. We are more concentrated today in focusing like focusing on Fpay, as we mentioned. Those are the $35 million in, on a yearly basis, with Fpay and passive. That's not considering the $350 that I was mentioning. Today we're actually in the process of focusing and actually building out what 2024 will look like for Falabella. We know that we're gonna get those savings. We're taking care of basically making them structural as it's supposed to be. More than just giving you a number, we're basically very concerned not only on the savings. Today it's more related to the stop doing, the closures that Gastón mentioned about stores, and certainly on focusing also on growth of the company. We need to make sure, because at some point this is not just a matter of reducing and reducing. There's certainly more, I would say, at SG&A that we can take down. We are. There are some initiatives that we're working on that, but I would say the most material and structural part is what we already did. Now we're focusing on making sure that the sales start going back and start normalizing to levels that we historically had. I don't know if you were in the first quarter call, but this is not the first time that we've seen leverage ratios like this one. This is the third time that at least I see them. The company has the capacity. It has had the capacity in the past to recover this in a period of 12, 16 months. 18 months, sorry. Maybe it's gonna take longer than that. Maybe it's gonna be 2 years. At least the plan that we're making considers that kind of recovery. Not certainly not during this 2023, but within 2024 time horizon. Gabriela, if I may add to Alejandro's comment, the focus also is going beyond SG&A in the sense of making the operation itself more efficient. We are putting a lot of effort on making the logistics a lot more efficient. The marketing investments, particularly performance marketing, more efficient. We are taking a lot of measures around our loyalty program to give, you know, make the expense on loyalty more efficient while not affecting the perceived benefit of the customers. It's a lot more around how the operation itself becomes more efficient. Also, we are seeing a second semester where we are, our purchases of products are decreasing. Also because of exchange rates and also the situation in China in particular, we are buying at a relatively lower cost than we have in the past. All of these things combine for a gradual improvement going forward, which translates into the time frame that Alejandro described of improvement. Thank you. That's very helpful. One more question on my side. I was wondering if you could give us a little color on the conversations that you've had with rating agencies, given the latest results. Thank you very much. Yeah, absolutely, Gabriela. You know that the relationship with them follows some confidentiality. What I can share with you is that we're being very transparent with them with the trajectory and the measures that we are doing to improve the leverage. We've already met with both agencies, and we've been meeting with them, I would say periodically. We have identified for them different measures, and we trust that these are sufficiently tangible and easy to measure to break down the leverage and to generate I would say some high degree of confidence in the plan. There are some things that I for confidentiality issues I cannot disclose with you. We've been very open with them at this report. Okay. Thank you. Thank you very much. Thank you. One moment for our next question. Our next question comes from the line of Carolina de la Maza from Morgan Stanley. Hi, can you hear me? It would be helpful for us. Okay. Thanks so much for taking my question. My question is regarding profitability. Gross margin continued to contract this quarter year-over-year with the mention of promotional activity and markdowns in apparel. Are you seeing any changes in the competitive environment? When do you expect this trend to reverse? Yes. Thank you, Carolina, for the question. I think we talked a little bit about this in terms of how we are seeing the market evolve. In terms of the competitive environment, we really as we measure our participation, we see that relatively stable with some loss in the harder lines and some gain in the softer lines and also some gain in the new categories in which our marketplace is participating. We are not seeing a tangible change in demand, particularly not in home improvement, which is very relevant for us. Most of our efforts are placed in really calibrating the buying activity to the demand we are foreseeing. Also optimizing the levels at which we are buying and also optimizing the mix within the stores so that the higher demand and the higher, which happen to be the higher margin products, have better exposure. With that, we do expect margins to improve in the third and fourth quarters particularly, and no question in the fourth quarter. And we already are, as I mentioned before, in a much better inventory position and therefore, lower margin pressures in terms of the need for promotions and liquidations. Thank you. Have a nice day. Thank you. One moment for our next question. Our next question comes from the line of Pedro Seixas from Neuberger Berman. Hello. Can you hear me? Yes, we can hear you. All right. Thanks for taking the question. Just touching previously on another question, and thanks again for the color on the profitability and margins. Touching on conversations with the ratings agencies, and what you previously said about the focus being on recovering sales and while continually reducing operations. In terms of timeline on executing the plan and margin expansion as well as potential raising capital, do you see enough time horizon to tackle leverage to a point where you see the ratings agencies extending the outlook or maybe even changing it? Basically, do you see, you think the current plan fits within the timeline you have discussed with the agencies to bring that leverage back to the IG level? Thanks. Thank you, Pedro, for your question. The timeline we have in our mindset is as I said before, is towards year end 2024. That's what we understand about the analysis that they do, basically 40 months, 24 months horizon. The timeline of what I mentioned is within that frame. The initiatives that I mentioned and some of initiatives that I was not able to mention, but I did share in detail with rating agencies. It is within the time horizon that they have. I would like to basically re-emphasize something that Gastón mentioned before, that the way we see the situation, and I think we share this with both rating agencies, is that the main challenge that we have is related to the EBITDA. That's why we have been focusing, I would say, all of the efforts in solving that. Initially through SG&A cutdowns and then basically some stop doing as we mentioned, and now basically trying to how we reactivate the sales, which is if you see the numbers of Falabella as a group, it's one of the main challenges. We have our top line is being affected more than just the margin and more than just the SG&A. If we don't solve that's, that's the main challenge that we have. If that's the, I would say, the main line of dialogue that we've had with the rating agencies. As I said before, someone asked about or someone mentioned that $300-$400 million, if it was, if we were willing to solve the net debt to EBITDA just by doing asset sales or just reducing debt, it would need a way larger amount than that. As I said before, main driver, EBITDA, that's where we're focusing our efforts. The other thing I would say is complementary, and it has to fit within this 20 year, 2024 horizon. Thank you for the color. Over and done. Thank you. We will now turn the call back over to Raimundo Monge for closing remarks. We would like to thank everyone for joining us today. I think we have one more question. Gigi. One moment for our next question. Our next question comes from the line of Bob Ford from Bank of America. Hey, thank you very much for taking the question. I actually raised my hand earlier, and I think the machine resets or I don't know if you have a real person to reset when you have started the call. A good day. Could you please share the discount internal growth rates used in the fair value calculation for real estate? What do you expect will be the purposes that Mallplaza Egaña and Mallplaza Sur will be used for now that the stores are closed? Just trying to get a sense of what the market is and where the demand is for those types of locations. Bob, if I didn't completely understand your question. I did get the last part. Mallplaza has, I think in both malls already, reassigned the space to other smaller or medium-sized retailers in general. Mallplaza is also in a quite, I'd say proactive movement to rebalance the space from fashion and other categories into food and beverage and entertainment. Okay. That's also part of what they're doing with the space that gets liberated by a couple of cases ourselves, but also in several cases, other department stores. That's how Mallplaza is rebalancing. In general, it's not generating additional vacancy. Actually, Mallplaza's vacancy levels are improving over the last year or so. Thanks. You had a question at the beginning that I didn't completely get. Of course. That is if you could please share the discount internal growth rates that you used in the fair value calculation for real estate. I need to give you a range, Chip, of that because I understand that's information that is not publicly available. If it's not the case, let me share that, because actually the way we work in the process with Mallplaza and our real estate unit was under lots of confidentiality values with the auditors and the advisors that we had. I'll check on that. And if it's something that we can disclose publicly, I'll make it happen. Fair enough, Ale. Would you give a range, or do you wanna even refrain from that? No, I'll give you a range because that... It's something that I can disclose. I'll range. It's in real terms, mid high, mid, one single digits, so relatively high. Thank you very much. Thank you. One moment for our next question. Our next question comes in the line of Nicole Lehmann from MetLife. Hi, can you hear me? Yes. Thank you. Thanks for taking my question. I wanted to understand, you mentioned the timeline to get back to the credit metrics in line with your IG rating was two years or end of 2024. I think you also mentioned that the timeline for the asset sales was fourth quarter or even first quarter next year. I did want to understand, where do you expect net leverage to close this year and what would make rating agencies comfortable to wait for next year to resolve the outlook on the rating? Considering, I think they have mentioned that they expect to revise the rating after the third quarter earnings. Thank you. Thank you, Nicole, for your question. Yes. Let me be as transparent with all of you as we are with the rating agencies. It's hard for us to come out with a number to year-end because we have basically set a trajectory for the net debt to EBITDA to go back with several initiatives. Some of them, the most sizable initiatives are actually the ones that we cannot disclose yet. The impact of that is something that should happen, I would say mid-2024. That is something that we share with the rating agencies. The rating agencies are, as you know, they are sovereign. They can take their analysis, but they tend to have a midterm view on how the company behaves. The other things are, I would say, have a higher degree of predictability. That's why I mentioned those, because we are really working on those. Aside of that, for me, it's relatively hard to come out with a number. There's some of the things we're gonna be working hard on those, and we're gonna be able to make them happen as soon as we can. Something that unfortunately we've learned during this year is that the numbers that we had in our mindset at the beginning of this year have certainly worsened as we see lower... No one was expecting the, I would say, the consumption scenario that we've been facing, especially in Chile. I don't feel comfortable or responsible in sharing numbers that I'm not gonna be able to rely on. Quarter front is something you can rely on. Thank you. Thank you, Nicole. Thank you. At this time, I will now turn it back over to Raimundo Monge for closing remarks. Thank you very much. We would like to thank everyone for joining us on Falabella's second quarter 2023 earnings call. Our investor relations team will remain available for any follow-up questions you may have. Thank you. Have a nice day. Thank you for your participation in today's conference. This concludes the presentation. You may now disconnect. Good day.