Good morning. We welcome you to Sonae's Q1 2024 results conference call. During the presentation, hosted by Mr. João Dolores, Sonae's CFO, all participants will be in listen-only mode. Q&A is available after the presentation. If you wish to ask a question during the Q&A session, you may do so by pressing the star key, followed by one on your telephone keypad. If you're experiencing any difficulty in listening to the conference at any time, please make sure you have your headset fully plugged in, or alternatively, please try calling from a different device. I now hand the call over to Mr. João Dolores. Please go ahead, sir. Good morning. Hello, everyone. Welcome to Sonae's results conference call for Q1 of 2024. Besides myself and the investor relations team, we have on the call Cristina Novais from Bright Pixel, Fernando van Zeller from MC, Luís Mota Duarte from Sierra, and Paulo Simões from Worten. I would like to start by giving you a quick note on our portfolio, as we have made important moves this year. Q1 of 2024 was marked by the integration of Musti into our portfolio, following the successful public tender offer launched in November of 2023. In March, the consortium led by Sonae reached just over 80% of Musti's share capital, with a total investment of roughly EUR 700 million. This operation is an important step in the development and future-proofing of our portfolio as we expand into new markets with a leading player in the pet care sector. Musti has been included in our consolidated accounts since March, though still with no material impact in the quarter's results. Already in April, our subsidiary, Sparkfood, completed the acquisition of an 89% stake in BCF in France for EUR 160 million, expanding our portfolio of businesses in the food ingredients ecosystem. This company will obviously start being included in our accounts from Q2 onwards. So moving on to NAV. As usual, our net asset value grew almost EUR 100 million this quarter and reached EUR 4.6 billion at the end of March, which equates to EUR 2.38 per share. This positive evolution was mostly fueled by profitability improvements at MC and Worten, as we will see in the next few pages. Let's have a look at our largest businesses in the portfolio, starting with retail, and MC. MC showed once again a strong operational and financial performance, in a context of a significant reduction in food inflation versus last year, and also intense competition in the Portuguese grocery market. Continente was able to increase its market share in this context and further reinforce its leadership position in the quarter, having opened six new proximity stores, since the beginning of the year. The health and wellness and beauty segment also delivered positive results, and fueled MC's revenue growth on the back of strong performances of both Wells in Portugal and Arenal in Spain. Total revenues increased by 9.4% to EUR 1.6 billion, with a like-for-like growth of 7.6%, with grocery volumes recovering quite significantly this year. Profitability improved on the back of this solid top-line evolution and also additional efficiency gains, which enabled MC to maintain its price competitiveness in the market. At the end of Q1, MC's underlying EBITDA margin improved 20 basis points year-on-year to 8.6% and reached EUR 139 million. As for Worten, it also had a good start to the year, reinforcing its leadership position in the electronics market in the country. Both core segments and new growth avenues maintained a robust performance, with Worten leveraging its marketplace, offering new categories and services to increase its share of wallets and customer loyalty. Total turnover reached EUR 310 million in Q1, a 9.3% growth and a 5.3% like-for-like increase, with the online channel continuing to be a key contributor to this growth, having grown 17% year-on-year and already representing roughly 20% of total sales. Just a quick highlight to Auchan and Dia, that delivered a robust top-line growth, while continuing to expand both in Portugal and also in foreign markets. The company is currently operating already in Spain, Belgium, and France, and has significant plans to continue to increase its presence over, in other geographies. Regarding profitability, Worten's strong sales performance, coupled with the ongoing cost efficiency measures, led underlying EBITDA margin to improve 40 basis points year-on-year to 4.7%. Moving on to real estate, Sierra delivered strong results in Q1 once again, mainly fueled by the solid performance of the shopping center portfolio. Indeed, this portfolio delivered once again quite impressive results. Tenant sales increased year-on-year by 7.4% like-for-like, driven by the macroeconomic conditions and also rental contract inflation adjustments, as we continue to have practically full occupancy in our shopping centers, around 98% occupancy in total. The services area delivered a 5% year-on-year growth driven by the contribution of new vehicles such as the CTT real estate vehicle and also the new ass in Germany, and new development projects continuing to progress well. All in all, direct results increased in the quarter to EUR 14.7 million, a 3.4% year-on-year increase, and NAV reached EUR 1.1 billion at the end of March, slightly above the year-end figure. In terms of balance sheet, Sierra's gross LTV continued to reduce and reached 37.9% at the end of March. Just a quick note on our telco and technology businesses. S tarting with NOS, as you know, NOS already published its results some days ago, showing once again a solid operational and financial performance. The company continued to grow in the telco segments, both in B2C and B2B, where it's continued to gain market share, and also had a very positive quarter in the media and entertainment segment, particularly in the cinema exhibition business. Net results were significantly influenced by an additional reimbursement of activity fees by ANACOM, and this has a significant impact, both in the net income of the company and also in the equity method results that consolidates at Sonae. The dividend of 35 cents per share, relating to 2023 results, was already paid in April and resulted in a total cash in for Sonae MC of EUR 67 million. As for Bright Pixel, the company continues to develop its investment activity. It currently has a portfolio of 43 companies in total, and in the, in Q1, it didn't execute, it did not execute any new investment, but it continued to manage its portfolio of existing investments. And at the end of Q1, NAV was quite stable, so which shows the resilience of the portfolio of investments that we have. NAV stood at EUR 344 million, and cash invested at EUR 177 million, reflecting a cash on cash of the existing portfolio of around 2x. Moving on to consolidated figures. Our turnover grew 11% year-on-year in Q1, reaching EUR 2.1 billion, mainly driven by MC and Worten, that benefited from a resilient consumption momentum. Underlying EBITDA increased by 15% year-on-year to EUR 158 million, mostly driven by profitability improvements at MC, which led underlying EBITDA margin to improve by thirty basis points to 7.6%. Total EBITDA followed a similar trend, increasing by 13% year-on-year to EUR 180 million, benefiting from the underlying EBITDA performance, obviously, coupled with the higher equity method contribution, essentially from NOS, which more than offsets the sale of ISRG and its contribution in Q1 of 2023. Looking at the bottom line, this very positive operational performance was partially offset by higher depreciations, following our businesses investments in the last few months, and also increased financing costs related to higher interest rates and also higher debt level, leading direct results to reach EUR 33 million in the quarter. Indirect results benefited from some small foreign exchange rate impacts in Bright Pixel's portfolio shareholdings. All in all, net results group shares stood roughly stable year-on-year at EUR 25 million. In terms of cash flow generation and debts, in the last twelve months, Sonae generated a solid operational cash flow of EUR 112 million. This is a reflection of the strong operational performance of our main businesses, despite the significant investments that we are doing to accelerate our footprint, namely in food retail in Portugal, and also due to some important refurbishment efforts in our existing stores. When including Musti's acquisition, consolidated net debt decreased by EUR 224 million year-on-year. Obviously, with the investment in Musti led total net debt to increase to EUR 1.4 billion at the end of Q1, which was well expected. The group's capital structure remains solid, with a conservative loan to value, significant liquidity facilities available, and a comfortable debt maturity profile of above four years. Looking forward, and as we take a look at the rest of the year, we remain confident that our main businesses will deliver solid performances, while continuing to reinforce their leadership positions. MC and Worten will remain focused on reinforcing their market shares and also delivering further growth and profitability. Musti will accelerate expansion in the Nordics while integrating itself within the Sonae ecosystem and looking for new international expansion opportunities. At Sierra, shopping centers should maintain the good momentum, while services are expected to grow further, supported on existing and new investment vehicles, together with new accretive developments that are being launched. Bright Pixel will continue to pursue, and invest in innovative startups to grow its portfolio and also manage its existing value, in its current portfolio. In addition, and after Musti, we have already announced the completion of BCF, as I mentioned at the beginning, the BCF acquisition, and should be closing the Druni transaction as well in the health and wellness and beauty space in Spain soon, as we get the approval from the Spanish Competition Authority. W e will be focused in successfully integrating in the group all the recently acquired companies. This is it for now. Thank you. Y ou can now open the session to Q&A. Thank you. Ladies and gentlemen, the Q&A session starts now. As a reminder, if you would wish to ask a question, please press star followed by one on your telephone keypad. Our first question comes from João Pinto from JB Capital. Please go ahead. Hi, good morning, everyone. Thanks for taking my questions. Starting with Sonae MC, could you please quantify the calendar effects? There's an additional trading day, there's Easter. If you could quantify them, would be great. Also on Sonae MC, can you update us on consumer trends? Are you seeing any changes to trading down trends? Do you see signs that consumers are getting stronger? Then on Musti, can you share any targets for store openings this year and for the next couple of years? Finally, in terms of net financial costs and comparing to the EUR 35 million reported for Q1, what's the reasonable level to assume for the next quarters after the recent acquisitions? Many thanks. Okay, thank you, João, for your questions. Fernando, do you wanna take the MC questions first, and then I'll take the other one, the other ones? Absolutely. Good morning, João. Just starting with the calendar effect, as you mentioned, so when you look at the impact on Q1, from Easter we have around 2%, slightly above 2% from the Easter impact. In terms of the leap year, we have an impact of slightly above 1%. I n total, the impact for the quarter was about 3% from the Easter and the leap year, and that's obviously a very important aspect to mention in the accounts. When you look at the consumer trends, as you rightly mentioned, last year in Q1, we were seeing an inflation of around 20%. This year, we are seeing an inflation around 1%, food inflation around 1% in Q1, and obviously, that has an impact on the consumer behavior. What we have seen in Q1 was the stopping of the trading down. We are not seeing a significant trading up movement, but we are seeing a stabilization in terms of the consumer profile and the weight of the private label in our sales. I'd say that's the key point in terms of the consumer trends we are seeing in the food division. Okay. Thank you, Fernando. O n Musti, as you probably know, Musti has stopped giving guidance to the market following the acquisition made by Sonae. W e are not providing official guidance to the market, also because we are reviewing the current strategy and value creation plan of the company. What I can tell you is that the company is going to accelerate its expansion, namely in Sweden and Norway, where it still has significant room to grow its presence. As you know, the company is originally based in Finland, where it has a market share roughly above 32%. In Sweden, it's the market share is slightly below that, so it's in the high twenties, and so our goal is to bring that level to the same level of Finland. In Norway, where the company has opened up more recently, we have a market share roughly around 16% to 17%. Here is where we see the highest expansion potential for the company. W e will continue to open up new stores, particularly in Norway and also still in Sweden, in the next few months. W e will probably give you a better update of that in the coming earnings calls. In terms of net financial costs, well, as you know, I mean, you now know our new debt level following the recent acquisitions that we've made. Obviously, net financial costs, we expect them to be slightly higher in the next few quarters, given the fact that we have increased debt and that interest rates are still to come down significantly, vis-a-vis the recent increases in the last few years. If you assume that we have an average spread of around 1%, and we are indexed to obviously the interest rates that are out there in the markets, I think it's relatively easy to make an estimate of what it would equate to in terms of financial costs. Thank you very much. Thank you, João. Thank you. W e're moving on to a question from José Rito from CaixaBank. Please go ahead. Yes, hi, good morning to all. O n Sonae MC, my first question is, which players are losing ground, losing market share? Because we have been seeing very strong performance from Sonae. The same applies to Jerónimo W hich players are losing ground? F or Sonae MC, what has been the market share evolution year to date, if you can share that? The second question also on the Sonae MC is related to the gross margin evolution. Y ou mentioned that you are not seeing any more further trading down. If you can share how much was the evolution of the gross margin year to date? When I say year to date, is basically to eliminate the calendar, positive calendar effect from Q1. And also related to that, if the gross, if the EBITDA margin increase in Q1 had any positive contribution in terms of margin terms from the calendar effect. F inally, a last question on Musti. T here was the recent change, as you mentioned, in terms of the targets. Just to understand, is this to be aligned with the fact that Sonae also does not provide targets or because the strategy might change for the company? Thank you. Thank you, José, for your questions. I'll take the mostly one first. T he fact that the company removed its targets was obviously, but those targets were set in a different context, in a context where the company had a diversified shareholding base. R ight now, with the level of control that Sonae has, we obviously have a different value creation plan for the company, one which is more accelerated in terms of investment and growth. T hat's why we decided to stop providing or removing those targets from the market. You're right that Sonae typically has a history of not providing guidance to the market, but we will be updating you with the objectives that we have for the company and also with the track record that we will continue to see in the next few months in terms of execution of that strategy. Fernando, do you wanna take the MC questions? Absolutely. Good morning, José. I'll go one by one, but if you have any questions, follow-up questions, let me know. I n terms of the market share, as João mentioned in the beginning of the call, we have seen a positive evolution of market share year to date, so we have increased our market share in food retail in Portugal in Q1 2024. In terms of who are the players who are losing share, I'm obviously not gonna comment that in detail. What I would say is we are seeing, obviously, a significant change in the competitive landscape with recent entrants, obviously, as you mentioned, gaining share with their expansion. We are seeing mergers, as you know, with Auchan India. We are seeing also the traditional channel not expanding the way the modern channel is expanding. And so we are seeing a lot of different movements here. I would say that fully focusing on MC, we have been quite focused on our value proposition and reinforcing it, and also reinforcing our expansion in convenience, as you know, and as a result of that, we have seen a positive evolution in terms of market share. Going to the question of margins and starting with the gross margin. I did mention that trading down was not happening in Q1 2024, but I would emphasize that we have seen pressure in terms of gross margin in Q1 2024. No, no trading down, but still gross margin going down because of the competitiveness of the market and the investment in price that we have done in Q1 2024 to remain competitive and having price leadership in the market. T hose effects are different when we go down to EBITDA margin. F ollowing the question you typically also ask, in terms of gross margin, we have seen a slightly decrease in gross margin in Q1 2024, as I mentioned. In terms of the staff over sales, we have improved the ratio also because of the strong top line performance, but also because efficiency measures we have put in place. The energy costs have also had a negative impact, because despite the low energy costs, we have seen an increase, a significant increase in access tariffs, in Q1 2024 versus Q1 2023. On the other side, on the other costs, meaning logistics, head office, shrinkage, we have, as you know, put in place a very strong efficiency measure plan, and we have seen a significant improvement there. That overall led to an EBITDA margin increase of 0.2 percentage points in Q1 2024. As you mentioned, it's important to say that it's not fair to compare exactly Q1 2024 with Q1 2023, because having the Easter in, and the leap year in 2024, obviously, helps in terms of the turnover performance and obviously has a positive impact in margins. T hat comparison, the slight increase we have in the EBT margin of 0.2 percentage points also need to bear in mind that we are in a quarter where the calendar effects are also quite positive. Okay, understood. Thank you. O n the energy costs, so going forward, do you expect it to be a tailwind or a headwind? We have been seeing the decline on energy costs, but I'm not sure if you have ideas. Sorry, can you repeat the question? It was difficult to follow. Going forward over the coming quarters, if the energy costs will be a positive or a negative for the margin evolution? So comparison. Energy costs. Yeah. Right. Year-over-year. Y ear-over-year, as we mentioned in the last call, we expect the energy costs to have a negative impact on our margin. As we are all seeing, the energy prices are quite low, I would say, but the access tariffs, they were EUR 20 per megawatt hour in the first semester of 2024. F or the second semester of 2024, the estimate we have, given the government disclosures, is around EUR 40 per megawatt hour. And so we expect, depending obviously where the spot prices will land, we'll expect a continuous pressure from the energy costs over sales. Okay. Thank you. Okay. Thank you, José. Maybe just to give you a little bit more color on the M&A question. As you know, the company had previously set out targets in terms of revenues, growth, also profitability, balance sheets and net debt to the EBITDA, and also dividends. I think it's we made this clear to the market, but in any case, I would like to stress that our focus really right now is going to be on growing the business. Right, and so that entails that, yeah, we, I would not expect any dividends to be paid by the company in the next few years. That was articulated to the market, because we want to fund growth, and we feel there's an opportunity for the company to reinforce its dominant position in the three markets in which it operates. And also eventually find international expansion opportunities. The company had a target of EUR 500 million in sales for this year. We would like to accelerate that. We would like the company to achieve higher level of sales already this year. Even at the short term expense of profitability, given the investments that we need to make to grow the company. And in terms of leverage, as you know, we have a quite conservative and prudent view on leverage. Although we could expect to see a higher level of leverage than the company has right now, it's currently very conservatively levered. That's below 2x net debt to the EBITDA. I wouldn't expect to see a very high level of leverage in the company in the next few years. Thank you. Thank you, João. Thanks, Vivek. Thank you. As a brief reminder, to ask a question today, please signal by pressing star one. Up next, we have António Seladas from AS Independent Research. Please go ahead. Good morning. Thank you for taking my questions. The first one is, well, mainly related with Musti, and it's related with the performance of Q1 that finished on March. At least looking at the figures and taking consideration the conference call, it seems that figures were on the weak side and some pressure on gross margin, and apparently, Musti will need to decrease some prices on some items for the coming quarters. Well, I didn't understand well, but maybe because they are losing market share or have some pressure from the competitors. I don't know if you want to comment on this, and if the performance of Musti regarding Q1 was online, was in line with your expectations or not? Thank you very much. Okay. Thank you, António, for the question. You're right. As you know, the company already announced its results to the market a few weeks ago. You're right that Q1 performance was, I would say, weaker than in previous quarters. This has a lot to do with the macroeconomic conditions currently, mainly in Finland. The country is facing a slowdown in private consumption, and that's where 40% of the revenues of the company are generated. T hat we are seeing some trading down movements there that have an impact on both food products for pets, but also accessories and discretionary products. The pressure. T he pressure on gross margin was a reality in Q1. It's, it's composed of two different main impacts. One is, you're right, so one, there was some more price aggressiveness on the part of Musti to maintain its market position. The company did not lose market share, in our estimates. T he company retained its leadership position and did not lose market share in any geography. A ctually, in Norway and Sweden, it continued to gain market share and increase its leadership position. Half of the pressure on gross margin was related to that price competitiveness that for us is, as you know, in most of our businesses, non-negotiable, because we want to remain leaders and maintain our market position. The other half was due to exchange rate effects. As you know, the company operates in three different geographies, Finland, that is a euro country, but also Sweden and Norway, where currencies are different. O bviously, because you buy products in euros or dollars, and you sell them in a different exchange, in different currency, there was an unfavorable evolution in this quarter, which accounts for half of the pressure on the gross margin. I would say that this is something that obviously we cannot fully control. O ur expectation is that we will see improvements along the year, up to the end of the year. It's probable that in Q2 we will see, we will still see some pressure on gross margin, vis-à-vis historical figures. W e expect this to be recovered in the next few quarters. Not only driven by external factors, but also by things that the company is doing to improve its gross margin. Mainly in sourcing a great part of the production of its own label into their production facility, which will have a direct impact on the gross margin of the company. K ey messages, yes, a bit weaker performance than in recent quarters. No, we are not losing market share. The company is still strong and still gaining market share in total in the Nordics, and the pressure in gross margin is expected to ease up until the end of the year. Okay, thank you very much. Just if I could, question on Sonae MC. I know that you don't like to talk about margins for the coming quarters. Nevertheless, it seems from what you. From your answers before, that improvement on margin, on EBITDA margin, 20 basis points, was mainly due to the Easter and leap year, Easter effect and leap year. S hould we conclude that over the coming quarters, you should not be able and take in consideration the energy cost, you should not be able to improve margins or? Not necessarily. Well, good morning. I would say that it's difficult to predict as of today. As I mentioned, we are seeing a slightly decrease in gross margin because of the pressure on the prices, the strong competitive environment that we're seeing in the Portuguese market, as you well know. In terms of the energy costs, we're also seeing some pressure. That being said, as you know, is a much smaller component of our cost structure, and we are putting a lot of emphasis on our efficiency measures, which we are being able to successfully implement. I would say difficult to predict where the EBITDA margin will land over the next quarters, but we remain confident that, with this strong sales performance, we'll be able to do a good job. To really predict if we're gonna be able to increase, decrease, or maintain it flat, I'll say it's probably too early, given the uncertainties in terms of the macro environment, the consumer environment, and so I would prefer to leave that question for the end of Q2. Okay, thank you very much, and congratulations for the figures. Thank you. Thank you, António. Thank you. As there are currently no further questions in the queue, I would now like to hand the call back over to you, Mr. Dolores, for any additional or closing remarks. Okay. Thank you very much for attending our Q1 results conference call, and thank you for making it this early in the morning. We will be back in July for our Q2 earnings announcement call, and we expect, as was mentioned, to produce positive results also in Q2, continuing the good trend and the good momentum of Q1 of the year. Thank you very much, everyone, and talk to you soon. Thank you for joining today's call, ladies and gentlemen. You may now disconnect.