Marisa Lojas SA

BOVESPA:AMAR3

Earnings Call Transcript 2021-Q3

[Renata Coutinho, executive]

[Audio Gap]

[Operator Instructions] We do apologize for these technical problems.

[Marcelo Pimentel, executive]

Good afternoon, and welcome to our video conference to release the results for the third quarter '21. We're working with our resumption, aligned with the forecast that we had shared previously with the market. And despite the challenges imposed by the macro environment and the very limited flow of these stores in the center of the town, we have seen a better resumption in the North and Northeast and in their shopping mall stores.

Another point that I would like to highlight is the significant improvement of productivity in our stores with significant improvement in pieces with average tickets. Same-store sales have practically recovered to 2019 levels. And the digital channels have a 3-digit growth.

Another point that we would like to highlight for the quarter was a significant enhancement of our gross margin vis-à-vis 2020 with the figures that we had in 2019. This is possible through the management in inventory that began in 2020 and a greater assertiveness and acceptance of the collections in the stores. Our expense management continues to be an important pillar of delivering fashion trends and quality based on a price sensitivity. We're delivering SG&A gains for the retail as well as for Mbank. And the efficiency initiatives put in place in the last years have brought about structural benefits and gains for the business.

Another important highlight is the continuous recovery of the Mbank portfolio that we will discover. We still have not gone back to the 2019 levels because of the slow resumption of retail, especially on our street stores. Despite this, we have robust results for this quarter.

During the third quarter, we continued moving forward in our strategic agenda, strengthening the pillars of our multichannel strategy. Our app reached 11,000 downloads, and more than 70% of digital sales are taking place through the app. In October, we went beyond 12 million downloads. We have a better assessment of the market with a 4.7% rating. We also concluded the implementation of our second dark store in Minas Gerais, ensuing the success of the first store in São Paulo. We have concluded the -- well, we have 54 stores operating with a ship-from-store model at present.

We began our marketplace operation for the Brazilian woman with our digital strategy. We have 3 sellers operating, and we're now beginning a gradual registry group. This is an extremely important step on our path towards a consolidation to become the platform for the Brazilian woman. In September, we celebrated the official launch of the Mbank that begins with the full integration of products and services in Marisa.

And finally, as we announced in the last quarter, we are re-inaugurating 4 stores based on our new model. All of this was tested previously in our pilot store in a large shopping mall, Sao Pedro. We began to do this in our store -- our icon store in Avenida Paulista, and we will extend this to Aricanduva, Osasco and Interlagos mall, all in São Paulo. At the close of September and beginning of October, we see the consistency of a resumption of flow in the stores and a positive resumption of sales at our units.

I would now like to give the floor to Adalberto Dos Santos, our CFO, so that he can give you greater details on our figures.

[Adalberto Dos Santos, executive]

Once again, we're going to speak about the figures for the quarter on Chart 4 to give you more color on the same-store performance. And net sales, to the left, as you can see, we see a significant evolution of our sales, obtaining BRL 530 million, a considerable increase vis-à-vis the year 2020. In 2020, the impacts of the pandemic were still very strong.

We have a significant evolution with the third quarter 2019. We have almost reached the level 0.8% sales for same-store sales. And we have gone through a period where the store flow had a drop of up to 30% depending on the store. Now all of these drops were offset with greater operating management, with conversion or larger number of pieces sold by ticket, which is a positive return, showing the clients have returned to our operation.

We had a positive performance in August, which points to a very good acceptance of the mid-season collection launched that month. We have already heard about our digital operation with a growth of 96.6% vis-à-vis the third quarter '19. It grew 62.5% compared to the third quarter 2018. And this highlight also applies to children, men and accessory categories with growth that are over 30% for the quarter. And these are non-audited figures, but we have a positive performance for October in same-store sales with a single-digit growth.

In the following chart, the retail sales with a 47% growth vis-à-vis the third quarter '19. 14% of total retail sales, more stable, and this should be the baseline in coming period. 70% of digital sales have been originated in our app. And our app began to be developed at the beginning of the pandemic. It has grown through the last 18 months. We already have 11 million downloads at the end of the third quarter and 12 million downloads at the end of October.

In the following chart, our gross margin evolution, also mentioned by Mr. Pimentel. At the top left, a growth quarter-on-quarter for the last 3 years. Gross margin, 43 -- 42.3% this year. Of course, last year, we were in a process of accelerated reduction of inventory, 33.7%, but very close to the figures of 2019. We have carried out a breakdown month after month and have included the month of October. It shows an evolution of gross margin in practically all the months with gains and with an evolution that points to a consistent growth month after month in this quarter compared to 2019.

And of course, this shows the success of the commercial strategy that we have implemented. We begin with a lower inventory level. We're working with approximately 22 million pieces in stock. And we have had an evolution, already preparing the company for Black Friday and Christmas. Now this more assertive commercial strategy and the number of items in stock, of course, has reduced the need for markdowns. We are down 27% compared to the same periods in previous years.

Here, you'll see the selling expenses, also mentioned by Pimentel, and of course, Marisa with a great deal of efficiency. At the top, selling expenses, BRL 219 million, the same level as we had 4 years ago in the third quarter 2018. Nominally, 3 years later, we are at exactly the same level. Now of course, this is thanks to the initiative and work implemented during these 3 years, but reinforced with the pandemic.

We highlight the multi functionality in stores and a change -- a massive change in processes that also took place in our distribution center and the review and renegotiation of absolutely all of the company contracts. And in stores, the highlight is the lease contracts.

We ended the quarter with BRL 42 million in SG&A vis-à-vis 3 -- the third quarter '17 with BRL 48 million. 3, 4 years later, exceptional gains, once again thanks to the same initiatives implemented in central management and because of the remote work that we have incorporated efficiently into the company.

On the next page, you see the Mbank contribution margin. It reached BRL 96.5 million, as you can see to the left. It had relevant growth vis-à-vis the year 2020, where we had BRL 49.1 million, because of the pandemic. But you can see that we're going beyond the figures that we had obtained in the third quarter '19 of BRL 93 million.

A special highlight. We still have portfolios that are 10% below what we should have. We're referring to our receivables portfolio. And this is due to the flow effect in stores that have ended up impacting revenues, especially sales revenues, in some of the products and services.

In personal loans, we have had a more rapid recovery because of the restrictive measures and the credit granting that we approved last year. These measures have been withdrawn, and we have a healthier recovery of the portfolio.

In the next chart, the evolution of our portfolio for private labels. At the top left, the portfolio losses, and you'll see the best historical performance since the third quarter '16, a loss of 2.5% if we exclude the nonperforming loans. And despite this, we are at our best historical level, and this is confirmed by the number of overdue, which is 5% of the total portfolio. At the bottom, the EFFICC, an indicator of future default, including August and September, but properly addressed by our teams and already under recovery.

In the next, the losses in the portfolio of personal loans. Once again, a very similar situation, the lowest historical drop, 4.2%, because of nonperforming portfolios. And once again, this is one of our best figures in the historical figure, 20.9%, for overdue portfolios. And below, once again, the EFFICC with corrective measures that are being addressed at present, and we're operating with a great deal of health and full safety.

On Chart #11, our consolidated EBITDA position ex IFRS-16, with a positive figure, with a great deal of joy. You can see that we have reversed the negative result of BRL 87 million last year -- BRL 80.7 million and also negative in the third quarter '19, where we did not have a pandemic. So this year, we're coming out of the pandemic. We had an impact during the first month, an the impact on flow. But we are already delivering a positive EBITDA, still somewhat timid based on our forecast but it is positive. And these results can be compared to the pre-pandemic levels.

In the next chart, once again, positive results, BRL 44 million. We have a nonrecurrent component here. And despite the fact that it is nonrecurrent, it does show the arduous work of our teams in the fiscal and controlling areas for a fiscal and controller recovery. And despite this recurring installment that is still negative, we do have a significant recovery. It was BRL 124.5 million negative last year compared to BRL 76 million negative in 2019, where we still did not have a pandemic and the company had initiated its turnaround. And as you can see, this confirms the recovery of the company in the retail part, personal loans and cards and Mbank.

On Chart #13, the cash flow with different behaviors for the 2 years. This year, the EBITDA -- adjusted EBITDA is slightly positive at BRL 170 million but with a significant uptake of capital to recompose the Mbank capital, taking us to BRL 248 million negative, very similar to last year, where we had a very negative EBITDA because of the pandemic. But we were able to release a significant amount of capital in the stocks and the Mbank receivables. The net impact is very similar. We have the same net operating cash, thanks to the work of our treasury and the management of debt -- rolling of debt. All of this was carried out with a great deal of competency.

We ended at BRL 280 million compared to BRL 318 million. Once again, this is a period with very weak results. And despite this, we end up with a cash position that is very good. The net debt level and -- reasonable values for net debt and gross debt standing at reasonable levels.

That is all. And we would like to speak about the outlook for the close of the year.

[Marcelo Pimentel, executive]

Thank you, Adalberto. And despite this still challenging macro scenario, we're working with a sequential improvement of results, especially by the fourth quarter. Our proposal of selling products with fashion and others that are accessible become ever more important at the moment. Like this one, we think that adjusting the levels of stock, the new collection and the acceptance that it has had and the purchasing experience shown in our NPS figures will enable us to maintain this improvement in our stores and maintain flow for the downtown centers and street stores.

Adalberto mentioned the figures, and you can see our gains in recurring expenses in several areas of the company. This points to a strong operating leverage at this moment of a resumption of sales. We have already mentioned that one of the main goals in the medium term is to launch our digital portfolio. We want to position the Mbank as the bank for the Brazilian woman.

And finally, perhaps one of the great pillars of our strategy this quarter was the launch of the marketplace for women. As I mentioned here, we're undergoing this process with sellers. We have now begun with higher volumes to accelerate the availability of our portfolio and categories that are complementary to our value proposition. This will continue to be the great tool of our platform, adding the experience of the purchase of product, services, Mbank and the recently launched [ MUniverse ], where we offer to women an area of content, services and specific experiences geared to women.

To conclude, we would like to speak about our new store model. The indicators of the pilot stores of the Dom Pedro shopping mall caused a great deal of enthusiasm. The results are above average for the company. And this leads us to believe in the importance of this project for the 4 stores and -- that we inaugurated in November. We're getting ready for a structure revamping program for 2022.

I would like to conclude this moment sharing with you a video of our new store model.

[Presentation]

[Marcelo Pimentel, executive]

Thank you. And we will now go on the question-and-answer session.

[Renata Coutinho, executive]

[Operator Instructions] The first question comes from Eric Huang from Santander Bank.

[Eric Huang, analyst]

Can you hear me?

[Renata Coutinho, executive]

Go ahead, Eric. You can post your question.

[Eric Huang, analyst]

I do apologize the confusion when I connected. Well, my first question refers to the marketplace initiative. You did remark on this, but it is something that is very insipient. If you could give us more details of the main product segments that you will work with and the time line that we can expect when it comes to the platform evolution. As part of the question, do you have the intention going forward of offering other services?

[Technical Difficulty]

[Renata Coutinho, executive]

I'm sorry, I'm reading the question here. Now the first question, once again, if we could speak about the Marisa marketplace initiative. Although it is still a very insipient initiative, if we could speak about the products we want to work with and what can we expect in terms of the evolution of this platform. In marketplace, if Marisa will sell services to sellers and logistic solutions.

[Marcelo Pimentel, executive]

Eric, this is Marcelo Pimentel speaking. Our marketplace, we should clarify what we want to be in, which is the path that we are on. We want to be the marketplace for the Brazilian woman. The mission of Marisa is to foster women's self-esteem. Therefore, we want to offer categories and a mix of products that will corroborate our present-day assortment.

Now the categories that we would like to expand on are categories such as beauty, cosmetics, care with women, female education. We also will have the opportunity of working with existing categories where we can complement our assortment with specific partners. For example, a category that we're preparing to work with refers to shoes.

When it comes to logistics and financial services, we are working to ensure that Mbank will be a tool for a potential purchase in our marketplace. It should not be an impediment. It should help our clients and customers to buy. But in the second phase, it should also help in terms of logistics. In this first phase, we're only working with sellers that can complete a full circle. We're not working as a logistics hub. We are extremely concerned, especially now, initially bringing in sellers that have an important and qualified seller performance with a good NPS, qualified to work on the last mile so as not to impact the experience of our customers. And in the second stage, of course, we will take into account all the logistic part of this process because it is important for the business.

[Renata Coutinho, executive]

Thank you. Very good. The second question made by Eric. To speak about your store revamping, if you could speak about the main changes that will be included in this new range of refurbishing. If you could give us more color in terms of the stores that will be revamped in terms of location or age? Once again, this is a question from Eric Huang.

[Marcelo Pimentel, executive]

Very well, Eric. It is important, for those who are not following up on this very closely, that this project began a little more than a year ago. When we launched a pilot test of Dom Pedro shopping mall in Campinas, the focus of this work is not to produce a flagship store. Instead, we want to produce a new store model that can be replicated to bring in better results and more sales. So we carried out studies with women, with our customers. And some of the main highlights that we can share with you are the enhancement of lighting, a change of equipment so that we can favor the fact that the product will be the main actor in the store.

We have changed the experience in dressing rooms. They're all broader. They have better lighting, better mirrors, all the technology within the stores. It was in this store that we have the mobile sales points. We have 3 specific points where the customer can enter shopping experience. Especially for shoes, leisure, we have a dressing room without having to go all the way to the cashier.

The second point, this store brings about that experience where we are able to unify all of our working contracts. Formerly, we had an Mbank area and a cash area. And through the pilot of this store, we were able to unify these 2 areas into a single one, and our associates work based on the functionalities, enabling them to do everything within the store. This, of course, increases store productivity.

And finally, this store was where we began and tested the multichannel model, not only with ship from store and click and withdraw, but also with what we call our [ advantage bank ]. Our customer walks in with the app in her hand. And within the store, she can research prices, she can check the products, she can see what is available for her, have access to a full assortment in aisles and even purchase products that are not physically present in the store and she can enter shopping experience at the mobile point of sales. And through the app, through geolocation, the customer can receive specific promotions geared to her within the store or next to the store.

In terms of our expansion vision, we're working on this at present. And the initial design is that these refurbishments will take place in our icon stores, stores that will be important not only to deliver the results and the brand presence, important sites of visibility for our customers. We do have a very important mission for the year 2022 in terms of number of refurbishment of stores. And we're also thinking of the opportunity of expanding other stores, especially stores in shopping malls where we have a significant repressed demand. And this is a demand from the shopping malls to have a Marisa store in their mall.

[Renata Coutinho, executive]

Another point -- the third and last question by Eric. Positive surprise with the resumption of the portfolio. If we can speak about a specific factor that has contributed to that gain quarter after quarter.

[Adalberto Dos Santos, executive]

This is Adalberto. Without a doubt, the use of the app and the availability of the products, conversion and making available all of the products that exist in the app. Now just to give you an idea, the customer can have credit approval in a few moments. As of the moment in which the customer applies, a few minutes later, they will receive a card and they can work with a digital conversion at that moment. And of course, there is a great deal underlying that side, an increase in sales.

If we compare quarter-on-quarter, we have 5 percentage points of growth in a product that historically had a drop. So our regular portfolio is 10% below, but despite this, we do have this exceptional result. And it is thanks to the recovery of our portfolio as well as losses that are completely under control. As I showed you in our historical levels in expenses, following the same trend in the retail sector with incredible efficiency for the period, which means that we have a combined generation of results that is very interesting with revenues down, of course, somewhat but efficient losses as well as very efficient expenses as well.

[Renata Coutinho, executive]

[Operator Instructions] The next question is Maria Clara Infantozzi from Itaú Bank. You said that the sales performance

[Audio Gap]

has been possible with an increase of 3.5%. We would like to understand the sales outlook for the company in the fourth quarter and especially in November with Black Friday. According to survey results, you should be selling a great deal of shoes and other categories. After the launch of the Mbank in September, what is it that you foresee to leverage cross-sell between bank and other areas?

[Marcelo Pimentel, executive]

Very well. As we mentioned at the beginning of the call, we're quite optimistic with the outlook at the end of October, the beginning of November for Black Friday in the brick-and-mortar stores as well as in digital stores. We do think there is a repressed demand in the fashion market. We understand that this will make a significant increase for us not only because of Black Friday but because of the season. We have Christmas coming very soon. So we're getting ready for an increase in our inventory.

As Adalberto mentioned, at the end of September, we began to get prepared for this. Now along with that movement and the advantage that we have when we work with more limited stocks, which is what we have been doing commercially, is to get prepared for these events and for seasonality, bringing in products that are purchased specifically for this, which allows us a significant margin gain. This is very important.

When it comes to cross-selling, the opportunity is enormous not only in terms of Mbank but when it comes to the multichannel experience for our customer. As we mentioned, the app is centering our vision of being the platform for women, bringing them store experiences, digital experiences, the Mbank and the [ MUniverse ] all in the app. And we want to work with the evolution of intelligence of our CRM program so that we can communicate with that customer at all of the touch points of her shopping experience. If it is through click and withdraw, we see a recovery in the share of this movement of purchasing digitally. It has brought the customer to the store through Mbank. And as Adalberto mentioned, 1 year ago, the customer was not able to buy with Mbank in the digital platform. With the evolution of our digital app, we not only allow them the opportunity to carry out their purchase using Mbank, they can also [ hire ] insurance, loans, personal loans and much more.

Finally, we do believe that the entire part of curatorship done through social media has been done. We have a deep knowledge of women, and it has allowed us to put Marisa at a level where we are able to speak to them as a woman but we also speak to them about their families. We had the best Children's Day in the last few years for Marisa. And all of this, thanks to the investments that we have made in these categories: men, women and accessories and children.

When women come into the stores to buy for themselves, there's also a full assortment for their families. And this has helped us to complement their shopping basket to increase the ticket and increase the average ticket. So this is the full vision that we have of the entire experience. We're going to contribute ever more intelligence to this process to have a better interaction with the women in the brick-and-mortar store, in the digital environment, in the Mbank or at any touch point with these customers.

[Renata Coutinho, executive]

Thank you, Pimentel. The next question is from Bradesco BBI. Which is your outlook for the opening of dark stores and your outlook for the format in coming years? How do they compare with normal stores in terms of profitability? And what is the rationale of creating a dark store in truth?

[Marcelo Pimentel, executive]

I will give this question to Rodrigo, the President of our Digital Platform.

[Rodrigo Poço, executive]

Well, regarding the dark stores, it -- well, we have a significant pool of consumers, and we do take into account some performance indicators that are important. The cost for the last mile, the delivery up to the customer's house, this is an important factor and the speed, of course, with which we are able to service that order. And in the dark store that we have in São Paulo, these are the indicators that have been considered fundamental for our work.

Throughout the year 2022, we have planned additional dark stores. We have come up with a very detailed plan. We are working with geolocation to see which are the areas and the rates of increase of this. From the viewpoint of strategy, we understand this as being a complementary strategy to ship from store and the strategy of our distribution centers. So it ends up creating a full process in terms of the purchasing journey.

[Renata Coutinho, executive]

Thank you. The next question is from [ Rafael Bueno ]. The first question, could you speak more about the problems in the supply chain and what we can expect going forward? And if you look at receivables and the payment of stock, we see that your levels are pre-COVID levels. Finally, if you could speak somewhat more about dark stores?

[Marcelo Pimentel, executive]

I think this question has already been addressed. Therefore, we will respond to the first 2 questions, [ Rafael ]. I'm going to give this question to Alberto, our Commercial President.

[Alberto Kohn de Penhas, executive]

[ Rafael ], it is a pleasure. We have worked very strongly with our suppliers and partners. This is a work that began approximately 1 year ago, where we reduced our supply base from 500 suppliers to 270. This increased the volume of participation of strategic suppliers in Marisa. Now having said that, we were able to manage all of this through negotiations -- direct negotiations with the suppliers of -- network of suppliers that we have. So we have had a significant evolution in our products. And this has enabled us to absorb some of the problems in categories. We're selling products with a better average ticket. And of course, this favors us, and we can absorb these gains.

But if we look at the increase in average prices, if we consider that we're selling products with higher value, we have been able to go through this period, minimizing this problem of lack of supply. What has helped us a great deal was to have begun that work since January, a proposal where we have leveraged these products so that they can have more interesting margins. And products with the Marisa brand must and should service our customers. And since then, we have been experiencing around what a more interesting assortment for our customers.

We began a project that is called [ ABC ]. We have intensified the replenishment of bestsellers and have increased the number of SKUs in these products that have high replenishment. Alongside with this, we are doing this in the stores as well. So we are able to sell these products in all of our subsectors. And this new merchandizing has taken us to evolve more in the lifestyle of all of the sectors of our stores.

We had interesting increase in accessory areas -- in men, children and the accessory areas per se. And we have had interesting figures that have increased vis-à-vis 2020 and are similar to the year 2019. Now we have increased this part of accessories because of the commercial cycle of the products, because of the event cycle of the products. And as we have mentioned before, these consumers not only buy for themselves, they also buy for their family. And we want to be able to have all of these products. So this is why we have had this increase, and we're trying to dilute the price increases.

Regarding the stocks, we have almost 30% less compared to the pre-COVID-19 period, and we're continuing the reduction. We understand that the more we understand the consumer in this new Marisa -- Pimentel has already mentioned this. More feminine, happier and a woman who is a protagonist, the more we understand her, the better we can focus on these high-replenishment products. And of course, we can work more with the product turnover more than we have been working with up to present.

[Renata Coutinho, executive]

Thank you. The next question is from [ Fabiano ] referring to the company's level of indebtedness. If there is a possibility of a capital advance because, in the medium term, we will double the amount in cash.

[Adalberto Dos Santos, executive]

[ Fabiano ], thank you for the question. Our cash level is [ 0.70 ] for the medium term. And it is distributed in Mbank and Marisa. In Mbank, we have a significant flow of capital raising. We have several individual persons on our platform. And in Marisa, we have not had any problems in terms of working with the liability in our day to day. After a period of great restriction last year, we have a greater flow in terms of credit.

The total volume for the company, we do not understand this as being excessively high. We have an adjusted value of BRL 419 million. This is in our release. So we're also seeking opportunities at every meeting with our Management Board. As the financial period, we speak about options to have a better capital efficiency. And for the time being, once again, this is the most feasible option. But with the figures that we have at the close of this quarter, we do not foresee any problems.

[Renata Coutinho, executive]

Thank you, Adalberto. And the last question from [ João Pedro Santiago ]. I would like to better understand why the sales in the North and Northeast sells more than in the Southeast? What can we do to attain the same levels in other regions of the country?

[Marcelo Pimentel, executive]

What we have observed is adherence and acceleration of the recovery in the North and Northeast regions, and all of this has become something recurrent after the pandemic in terms of what can be done. What we see are very specific scenarios. As I mentioned here, we have the North and Northeast doing very well, and they're doing very well in all of the categories. We had very good acceptance of our new collection. This is very promising for us. In the South and Southeast, in shopping mall stores, we're also doing very well, perhaps not at the same levels as in the North and Northeast but at levels of 2019.

The challenge that we have for

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large centers. And this has a direct correlation with a flow into the stores. And this is due to the fact that several offices have not gone back to working. And these stores, because of their nature, have a much higher demand of flow than the average stores. And in this resumption with a very gradual increase of fascination that we should obtain until the end of the year, this Black Friday and Christmas, our expectation is that we will recover the figures for this very different group of stores. Once again, it's a very specific scenario that relates to the macroeconomic situation of these specific areas, and it is due to the flow of people who have still not returned to working in offices in the large centers.

[Renata Coutinho, executive]

Another question of João Pedro about the future. Which are the greatest challenges that Marisa will face in coming years?

[Marcelo Pimentel, executive]

I think that our challenges are positive challenges: the resumption of investments in Marisa to recover consistent growth for the company. We have worked arduously to improve the products. This has been the great challenge. We now have products that are more consistent. We have made great strides in terms of multichannels. We began in 2017, and we observed an ever greater flow and ever greater participation in this. In 2017, digital represented 2% of total sales. Presently, it represents practically 14% of total sales.

Some of the challenges now are to plan the growth recovery, a structured recovery for the company, continuing to invest in products and coming closer to our target customer who is the woman in the labor market. That is our customer, a woman between 25 to 35 years of age, married with 2 children. And in that case, we will be able not only to sell products to that woman but also to her entire family, increasing the average ticket.

And with the recovery of investments in the new store model, it's a big challenge to do this in a consistent and orderly way and to bring in better figures and results compared to what we have seen so far. We want to increase the scale of this. We're quite optimistic that we have the right strategy, the right team to deliver the strategy, and we now have to focus on the execution of the strategy. Doubtlessly, it will bring about the results we are seeking.

[Renata Coutinho, executive]

Thank you, Pimentel. A question of [ Jose Odorizzi ] on sustainability and social responsibility and cutting costs.

[Marcelo Pimentel, executive]

Well, there's a great deal that we can say for Marisa in that direction of ESG. First, I would say that it is in accordance with our mission of putting the woman in the center of everything that we have done. More than 70% of our company is made up of women. We have worked a great deal to ensure we have women in the leadership levels of the company. In 2021, we celebrated women onboard. 20% of our Board is made up of women.

As a company, we have worked as a participative company, working and participating in causes such as violence against women, breast cancer and more specifically in 2021, fostering women's entrepreneurship with [ Women's Skill ] and several other organizations. This month, in São Paulo, we are one of the sponsors of an event, and we are participating with companies that have stood out in female entrepreneurs that are showing their capacity in that field.

And in the case of sustainability, we have been working strongly in the context of energy. More than 70% of our stores use renewable energy. Our store park works with LED lamps, and we're ending this process to have 100% of the stores with LED lamps.

And the governance of the company is extremely well structured with an independent Management Board and strategic committees that participate in the entire process. We're quite confident in this model, and we are sure that we will have a very powerful governance.

In the last quarter, we concluded our sustainability proposal. We have a sustainability committee, and with the Board and management, we have agreed on 2 important pillars. We're going to be working in a variety of areas, and we will communicate this document to the market. But we do have 2 essential points here. One, the issue of female entrepreneurship, putting the woman at the center and fostering self-esteem through financial independence that she obtains as she is able to move away from an environment of violence and becomes more assertive and also by raising a flag for the deconstruction of women's beauty.

Marisa is a store for normal women, and we ever more want to sell products and services to these women. So this is our journey. There is a great deal more to do, of course. And very soon, we hope to be able to share with you this document which is being concluded at present.

[Renata Coutinho, executive]

Thank you very much, Pimentel. At this point, we would like to end the question-and-answer session. I would like to return the floor to Mr. Pimentel for the closing remarks. Should you have additional questions, the IR is at the full disposal of analysts and investors.

[Marcelo Pimentel, executive]

Thank you all for participating with us. We are quite enthusiastic with the results of the third quarter. I would like to thank all of our associates, many of whom are participating with us today. And I invite you to visit one of our new stores in downtown São Paulo so that you can see what is happening. In reality, as Renata mentioned, we're at your entire disposal for clarifications or questions should you still have some.

We're entering the fourth quarter with a great deal of confidence for a consistent recovery of the fashion retail. We have had positive figures since September, October and November. Thank you once again to all. Have a good day.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]