CVC Brasil Operadora e Agencia de Viagens SA

BOVESPA:CVCB3

Earnings Call Transcript 2022-Q2

[Operator]

Good afternoon, everyone, and thank you for standing by. Welcome to the CVC Corp. conference call to remark on the results of the second quarter 2022 and the first half of the year. With us today, we have Mr. Leonel Andrade, the CEO; and Mr. Marcelo Kopel, CFO and IRO; and Mr. Bruno Brasil, Financial Planning Director and IR Director.

We would like to inform you that this event is being recorded. [Operator Instructions] This event is also being broadcast simultaneously over the Internet via webcast and can be accessed at www.cvc.com.br/ri. You can also download the slides, which are available for download.

The replay of this event will be available shortly after the conclusion. Before proceeding, please bear in mind that the forward-looking statements made herein regarding the business prospects, projections, operational and financial goals are based on the company's expectations and assumptions as well as on information currently available to the company. Investors and analysts should understand that overall conditions, et cetera, conditions could impact the future results and lead to results that differ materially from those expressed in these forward-looking statements.

In other words, therefore, we will only attain the results depending on the environment in which CVC Corp exists. Now the data and results presented here refer to the economic scenario referring to the second quarter of '22 and the first half of 2022. With this conclusion of the legal notice, I would now like to turn the floor over to Mr. Leonel Andrade, the Chief Executive Officer, who will begin the presentation. Mr. Andrade, you may proceed.

[Leonel De Andrade Neto, executive]

Good afternoon, and thank you very much for being here with us. I think that it is worthwhile underscoring how much the market has changed in the last few months and how the tourism sector has been favored. We were one of the most affected sectors during the pandemic and now, perhaps we are the segment that is prospering more. And of course, this is very positive when we think about the prospects for CVC Corp. A proof of this is that in the second quarter, the reservations, both confirmed and booked, had a growth of 124%, while the consumed one had a growth of 154%. And this case of growth helps us considerably in terms of our revenues that grew 134%. We also had an increase in capital during the period, helping us significantly, enabling us to be able to generate business which has happened in a very positive fashion in the second quarter and during the last few weeks as well.

The corporate tourism as well as leisure tourism show robust growth in all of our businesses. This includes Argentina. In Argentina, we have worked strongly to maintain our leadership position. Without a doubt, this will guarantee a very positive prospect going forward. We now go to Page #5. We have invested since the beginning of this management in the knowledge about our clients. CVC Corp. has gotten up to this point as a company that is brilliant in terms of its knowledge of tourism. We are champions in the distribution of destinations and distribution of channels for groups, in general, and we would like the company to have significant growth for the tourists as well. They are our customers and we want them to be at the center of everything.

We started from scratch and we presently have a highly robust business in terms of influence among our clients, that ability to know the clients, as we have done in the history, leads us to having 29 million clients, a high number of contactable clients and 12 million under our influence. We have 1/4 of clients that we talk to based on this engine of influence. And this, of course, is the best technology that there is in the world for this. This means our assertiveness grows a great deal and allows us to reduce investments in advertising. We are working with direct communication, 200,000 hits with clients that we know with a great deal of assertiveness. This, of course, has contributed to our growth and has helped us considerably in the B2C channel where we have the very best profitability.

And as a result of all of these investments, as you will see going forward, especially in the next 5 months, we will have a radical change in the company under the viewpoint of front end products and communication with its customer base and distribution. All of the platforms that are being built are at present being concluded and they will come into operation in the coming months, enhancing the customer experience. We're referring not only to B2B but also B2C and all the businesses in Brazil. We go to Page #6. We held a convention after a very long period of the pandemic without having face-to-face contact. We held a convention with all of our franchisees in [ Marcel ] recently. And this, of course, aided in a bit in our business, allowing us, since the arrival of this management, to have a unique and aligned communication with all of our franchisees.

We constantly visit them and I can guarantee that our franchise business has never been so robust, so aligned, with the masters and master franchisees. We're highly aligned, especially now, with a change in our technological processes. We're extremely enthusiastic with the future of the business. In the next page, I would simply like to say that we continue to invest in enhancements and novelties in the company. And what has happened here is very little when we think about what is ahead of us. Suffice it to say that our B2B system has the companies unified. And in the coming months, we will have a single front end and a single brand for the entire B2B business, where we are leaders in the sector and will continue to be leaders, I do not have any doubts regarding this.

Of course, with an extremely good team and very clear and transparent governance, we will continue to be market leaders presenting highly robust innovations and a consolidated disruption, which, in the practice, has never had any novelties and is working on the same model that it worked with years ago. All the competitors are doing more of the same. And we are going to begin to present innovation in this sector. I would like to speak about the developer portal, which is fundamental to leverage our partnerships. As you know, we are the company behind the larger banks in Brazil, such as Itaú, Safra, Santander Bank. Now this new portal in the coming weeks and months will enable us to add almost partners, we already have a dozen.

I'm referring to smaller companies and banks that, of course, will be fundamental offering us a great deal of opportunities until the launch of this portal. Historically, we needed to create a dedicated business to each institution we are now working through this portal. And all the innovations will be coming in the following months. I would now like to give the floor to Marcelo Kopel, who will begin referring to the results, beginning on Page 9.

[Marcelo Kopel;CFO, executive]

Thank you, Leonel, and good afternoon to all of you. I am on Page 9. And in this slide, we would like to share the vision of Brazil. We show you the confirmed reservations. And in blue, it's the domestic and in yellow, the international reservations and bookings. You can observe a robust growth for the second quarter, 96% vis-a-vis the first quarter. And what draws attention is the international reopening. There are less sanitary barriers at present, a larger offer of exclusive flights in the air network and this allows us to accelerate our sales at international level. The international bookings have had significant activity and this shows the power of distribution and penetration that we have. There is pent-up demand that is being serviced, it will continue to be serviced and this is what we're going to begin with. At the top of the slide in the yellow curve, you can see what this represented vis-a-vis 2019. And we see a significant leap.

Since the first quarter of this year to the second quarter, we went up 44% to 67%, and we observed the same domestically. This is a quarter where the figures are much higher and shows the power of the market and CVC benefiting from this power. We go on to Slide #10. Going from the left to the right, you see the take rate evolution in 2022. In the first quarter of 2022, you can see our figures and the effects that we had during the quarter. We had an effect due to a larger growth, a greater presence of reservations in the international flights. In the first quarter, it was 43%, in the second quarter, 55%. When we look back at 2021, we reached only 29% in the second quarter '21. Now, both internationally and nationally, this generates the impact of 40 bps in the second quarter when compared to the year 2021. When we look at the speed of growth of our business, B2B, in Brazil and Argentina, the speed of growth is above that of B2C, and I will also refer to B2C.

The fact that all of our businesses are growing but that we have greater speed of growth in B2B ends up creating a dilution in the consolidated take rate. Now, what impacts our revenues and our take rate is more connected to the consumed reservations when we speak about those reservations. And I remind you that we do have a certain seasonality. The first quarter is very strong in these reservations because it is a vacation period. And this is repeated again in the third quarter, once again due to vacation. So it's normal to have this seasonality. Notwithstanding this, we had more accelerated growth in the B2B business, both in Brazil and Argentina. In this quarter, we had several points of growth because of the CVC anniversary and some reservations that were altered. This generated an impact of 50 bps for the half of the year. And in the land tourism, we had a readjustment vis-a-vis what we normally have, generating 60 bps of compression for the quarter.

Once again, this is something very typical of the half of the year but it was recorded in this quarter. Now, the take rate basically was impacted by differences in our mix in the growth of business and the international and domestic sites. When we go on to the next slide, #11, we can observe that the consumed bookings continue to be very strong, more than 150% growth year-on-year. Brazil, growing at very robust rates, as well as Argentina, even though we are aware that there is great seasonality during this period. Net revenue in Brazil influenced up to a certain measure because of the lower volume of shipments because of B2C. And in Argentina, we observed a contrary movement, a growth of 12% vis-a-vis the first quarter of 2022.

When we look at the take rate, Brazil once again with that effect because of the mix that I mentioned in the previous slide, and Argentina, with significant acceleration of our business in Ola, which is equivalent to our B2B in Brazil and Argentina, enabling us to have an increase in take rate. We have more accelerated rates of air tickets in Argentina in this business. Now, we continue to sell very well not only land but also air travel but with an acceleration in the business of Ola, thanks to a campaign that is called hot season, and that is being held in the industry during the second quarter of '22. We now go on to Slide #12. We spoke about net revenue. And this net revenue is very aligned to the growth of consumed bookings. We had a growth of 153% for reasons we have already mentioned. We had a reduction in this line item vis-a-vis the first quarter because of a lower number of shipments carried out between April and June.

And I remind you that January has the impact of vacations. And we once again hope to have a positive impact for the month of July with a positive impact on the third quarter. When we look at B2B in the second quarter, the revenue was impacted by consumed bookings of 153%. And also in Argentina, EBITDA, of course, prospering because of this dynamic with an improvement of BRL 32.6 million. In the first quarter of last year, we did have the impact of the second wave of COVID. This year in January and February, we had the impact of Omicron. If we had to speak about some sort of normalcy, we can say that beginning in March, we began to have normal and consistent growth in our bookings. The last comment I would like to make in this slide refers to the net loss, which is the last line item you see to the right at the bottom. It is important to highlight that vis-a-vis last year in this period last year in the first half of last year, CVC was still creating credit.

Only in the second half of last year, we had worked with BRL 33 million of tax credit, something that did not happen this first half of the year, allowing us to be in a better situation. So that net loss in a comparative base would have been even better had we maintained the same criteria and our social contribution, [indiscernible] is now down to 0 as well as that of our fixed cost. So this is a completely different situation compared to that of last year. We go on to Page 13 to speak about cash flow. The cash flow once again reflects the efforts that we make and we continue to invest in our technology platform for information security. Now, Leonel has mentioned that we will be harvesting the results of this now in the second half of the year in the B2B as well as in B2C and online bookings. We successfully completed our follow-on in the month of July. We had an increase of BRL 368 million in our cash.

Now these resources are there to reinforce the company cash in this environment of accelerated growth that we can observe. We also had the payment of part of our debentures. Because of this, our net debt had a drop. When we look at the company cash and because of this capital increase, we didn't use our anticipation of receivables in the first semester, it was BRL 600 million. In the second quarter, this went down to BRL 240 million, BRL 360 million that we had resolved in the first quarter. We go on to Slide #14. The debt net has been reduced to billion BRLs, it's thanks to the amortization of one of our debentures. Net debt had a fluctuation upwards but this is due to the fact that we work less with the anticipation of receivables as we did not require this additional resource in cash and it generated less financial expenses. I would like to conclude my part of the presentation here and I return the floor to Leonel.

[Leonel De Andrade Neto, executive]

Well, thank you very much, Kopel. And before we open for questions, simply a few additional remarks on Page 16. I think that definitely, we will go into a very sustained recovery. The second semester doubtlessly will be very strong, and we're being structured in 2 fronts, both in leisure and corporate areas nationally and internationally. We continue to invest in products and funding solutions. We have 230 exclusive seats for the coming months. And this, of course, will create a huge competitive edge, especially now because of the substantial increase in traveling.

And as scheduled, we are going to have the integration of B2C with our new platform at the end of September and throughout the entire month of October, which means we will end the year in a completely different situation with B2C as well as with the unified B2B platform that went live in June and will be fully integrated in the coming months. Our loyalty program will come about very soon. Very soon, you will be informed about the brand and the strategic positioning and our operational processes will strongly be attacked once these new platforms are aired. It means that we will have greater reliability and more uniform information coming from each channel. And this will enable us to work very strongly in the automation of in-house processes after sales and back office. Finally, once again, we had this success in the capital increase. We were highly conservative with a great deal of access to credit.

As mentioned by Marcelo Kopel, I'm convinced we will be very well prepared to continue having the company grow at the best possible pace in the market. And in the coming months, the entire company will be on track when it comes to its debt and financial costs. I would like to thank you for your attention, and we are at your entire disposal for questions and answers.

[Operator]

[Operator Instructions] Our first question comes from the webcast from [ Luis Colo ].

[Unknown Analyst]

What is it that we can expect in terms of the company's working capital as the need has been growing in the last few years? Will it be necessary to obtain more capital?

[Leonel De Andrade Neto, executive]

Luis, thank you for the question. I would like to remind you that we're leading a year when we compare with the year 2021, where we had BRL 8 billion in sales and an accelerated EBITDA, we have 124% growth in EBITDA. Well, it's natural that we have a greater demand for working capital. And as we grow, we have a different speed of growth in sales. When we grow in B2B, the demand for working capital was very low and the growth of B2C has a demand for working capital because we carry out our sales with partners. Now, what we have done helps us to navigate through this period and to enhance our leverage. The next thing that we will address is our debt profile.

We have maturities that will happen in the second quarter of 2023, rounding up the figures of the BRL 900 million, approximately BRL 650 million will mature in the second quarter of 2023, a part of them in 2024 and yet another in 2025. So if there is demand for capital, the priority will be to address that part of our balance and not necessarily work with another capital increase.

[Operator]

Our next question also comes from the webcast from Ruben Couto.

[Ruben Couto, analyst]

Could you remark on the expectation of the take rate dynamic for all the businesses for the rest of the year, there are several moving parts? And we would like to know if the price impacts and readjustment of partners will continue on or if there are onetime thing?

[Leonel De Andrade Neto, executive]

Ruben, let me shed some light on this issue. First of all, all of our businesses, at present, have a very healthy take rate in the sectors where they are active. The take rate of B2C, CVC is the largest and the healthiest in the market. The take rate of the B2B, I do not doubt, is also one of the best in the market. In the B2B and B2C competitors, we have seen some madness of trying to sell at any price. We have been extremely responsible and will continue to be responsible in terms of our robust growth. We will not leave aside quality and price. What happened in this quarter regarding take rate, first of all, was a very significant change in mix. Argentina was the market that took longer in terms of its resumption. I would like to remind you that the Argentinian market is substantially international.

And there has been a drop in the rate of contagion of Omicron, countries opened up their frontiers, you no longer needed tests and vaccination and the Argentinian's came back full steam and began traveling, so we had a very good quarter there. And speaking generally, Argentina, because of the makeup of their business, have a take rate that is lower than the average of the company. The same holds true for B2B, which is the sector that most grows. We are leaders. We will not stop being leaders despite the competitors. We're not going into the price war but we will continue to grow. And we also had an impact on the average take rate of the company because of this. This happens every year. The take rate is always lower than in the first quarter. Because of a lesser number of shipments, we also had a drop in the volume of pricing. Our balance dropped. And of course, we honor everything that had already been sold. And we did have some operational adjustments.

It's good for you to know that we have a policy of being fully transparent regarding everything that happens in the company, and therefore, we reported these adjustments. Our pricing policy has not changed. It will not change. Eventually, we might be more aggressive in some promotions but the policy of the company will not change. Everything that we have developed is standing and will continue to do so. Although the take rate was not good in this first half of the year, I acknowledge this because of the factors mentioned, not because of management, but take rate will continue to be healthy and we will be the company with the best take rate in the market. There is no reason for this to be different.

[Operator]

Our next question through audio comes from [ Benicio Spreo ] from Bank of America.

[Unknown Analyst]

First, referring to B2C, if you could speak about your expectation for the evolution of this segment and the impact that you had on sales because of the implementation of the credit marketplace? And if you could give us more color in terms of your technological enhancements and what you imagine will be the impact in the user's experience and the impact on cost, of course?

[Leonel De Andrade Neto, executive]

Regarding B2B, this market is growing very strongly. There is no fertility after the pandemic or throughout the pandemic and presently, many medium-sized and small operators and other small businesses do not have the financial health or credit to operate. Some are very well-known operators, traditional players in the market that nowadays are too fragile to compete. And because of this, they have outsourced their sales. B2B traditionally was a business for small companies, small travel agencies or for corporate market agencies, nowadays, it has become a big business with different sizes of operations. I do believe that B2B will continue to grow, will continue to be robust and this business will concentrate in the hands of 2 or 3 large players. The competition is somewhat fragmented because of regions. We have several regional players.

And this is a business that continues to grow and poses quite a few opportunities. The second point regarding the marketplace. Everything that we're doing from the viewpoint of technology, imagine that the CVC store will change substantially in 2 months. We have a platform that is not very friendly. Several sales platforms that resulted from our activities in the past without continuity acquisitions, without integration, this leads to fragmented sale. If the client wants to buy several products besides going to the store, he or she will have to go into different platforms, different front ends and even for payment, the transactions will be multiple, now, this will change substantially as of now. And probably, our stores will have a significant gain in productivity. They will have a better cross-sell of products. And when the credit marketplace comes into operation, it's not a full marketplace, it's based on a single player.

We now have new players entering and of course, this will add improvements and will give a competitive edge to the store transactions with opportunities for the client. I'm being conservative but the changes are so strong vis-a-vis the past, no matter how good the platform is, the beginning is always difficult. It's like putting on a new pair of shoes, you have to adapt to it. When you change your mobile phone, you always have new functions and you have to adapt to them. This, of course, will take place but the platforms will represent a significant benefit. I will not mention sales figures, this would be too daring on my part. I don't know if you have more questions. Yes, I'm sorry, investments in technology. If we move back 2 years, CVC Corp. entered the pandemic at the worst moment in terms of health. We had governance problems that are public. We entered the pandemic with BRL 2.2 billion in debt.

We entered with all of the company costs at a very poor level because there was no integration whatsoever between the businesses acquired, and therefore, the costs were extremely steep. And the net equity of the company was negative. This was a business 2 years ago. During this management, the costs have grown, and I'm not referring to investments pure and simply. Our commitment, and my personal commitment and that of my colleagues, is to have a reliable company that has reliability and governance and we're very transparent and demanding regarding these values and to have a better governance one that is reliable. Without the best technology platforms was to add more processes and more people. And of course, this led to a cost increase. The costs are higher than they should be as investments in technology are underway and will begin to show us results.

In the coming 6 months, the focus of the company will be geared to the usability on the part of the client. Everything will be done so that the end user, the store or the travel agents can use the platforms that will be friendly and will have a better productivity. In 2023, our entire focus will be to substantially reduce manual work and automation of processes. Without a doubt, we will have a transnational company with the same level of control but with more rational and better costs. I would also like to remind you that we are one of the very few companies in the market that paid 100% of all of its implications on time despite the pandemic. We did not renegotiate with our creditors, we paid what had been agreed upon in the contracts with the government, with partners, with employees and clients. Apparently, because of this, we have very high costs. And on the other hand, our credibility enables us to have good access to credit.

And we're going to make all of those investments for the company to change. Without a doubt, you will be able to observe this.

[Operator]

Our next 3 questions are from the webcast from Gilberto, Galapagos Capital.

[Unknown]

The first question. Argentina has gained relevance in the makeup of the CVC profit. What is your vision of this with the economic deterioration of the country?

[Leonel De Andrade Neto, executive]

Very well, I will begin to answer and Kopel will complement. Our operations in Argentina are very sound. We have the significant merit of having unified the business. We made an agreement and all the partners left 2 years ago when I came in, presently, 100% of the company is under the management of CVC Corp. and the entire operation is integrated with exclusive management for the country, this gives us better visibility, integration of business and cultural integration and we put into practice everything that we think in terms of governance models. Now having said that, the operation is growing in a sound way. The great challenge here, of course, is to manage the country risk. The operations are entering sustainability in terms of volume, images and much more.

We have reached very good levels and because of this, it has not been necessary to contribute with new capital in the company in Argentina. And on the other hand, we don't think that we will have the exit of resources. We have to be very attentive, manage Argentina in the most conservative way possible but what we have at present is a very sound business under our management. Of course, this makes our life easier.

[Unknown]

Well, the next question made by Gilberto the following. CVC has recurrently worked with the discount of receivables. Is there the forecast for these operations to stop and which is the monthly cost of these?

[Leonel De Andrade Neto, executive]

Gilberto, thank you once again for the question. We manage our cash using as the main instrument, the discount of receivables. We have an estimated cost of CDI plus 2.5%. And as we grow and we detect opportunities and accelerate the growth in some products and services, we work more or less with a discount of receivables. The follow-on has helped us to reinforce our cash at this moment of growth. And I go back to a comment I already made. We are in a year where we're growing more than 5%, so we have to resort to the discount of receivables. It's expected. We have not increased our net debt. Quite the contrary, we have reduced it. So to resort to the discount of receivables is something natural. And as we have more than 5% growth, it's part of the management of the business as you decrease growth. And as you enter a different regime, the discount of receivables will decrease but we will continue to use this as one of the instruments to manage our cash.

[Unknown]

Now the third and last question is the following, which is a CVC plan to amortize the high flow of debt that is concentrated in 2023?

[Leonel De Andrade Neto, executive]

Simply to recap for everybody, in the second quarter of 2023, we have BRL 650 million of the BRL 900 million of gross debt, BRL 100 million for 2024 and another BRL 100 million for 2025. Now, because of the market moment and because of our operational leverage, we should hold a more constructive conversation with the market in terms of the lengthening of the debt. Our rationale to do the follow-on was to show the market our operational leverage that CVC can deliver in the second semester and all of the business opportunities. And ensuing this, we will speak again about the debt that matures in 2023. This was the rationale of the follow-on without the lengthening of the debt at that specific point.

[Operator]

We continue now with a question from the webcast from João Soares from Citi.

[Joao Pedro Soares, analyst]

I would like to gain an understanding of the temporary effect in corporate travel and how this impacts the B2B take rate. Which is the normal take rate for B2B and which is the leverage to improve this take rate?

[Leonel De Andrade Neto, executive]

I don't think the effect is temporary. I think the effect on corporate traveling is permanent and is coming back strongly. There has been a change in behavior but it's not substantial. Of course, none of us will maintain the same behavior, go to Rio de Janeiro for a quick meeting and come back but what moves the corporate market are the longer travels, Congress fares, exhibits and this is back and has resumed very strongly. In practice, they're even stronger than in the past because of the pent-up demand. Everybody wants to travel and participate. Corporate traveling is back, this is not something temporary. And instead of a new normalcy, we are back to normal beginning now. And very probably, the year 2023 will be a full year comparable to 2019, this for all of the tourism sectors. Regarding the take rate, B2B and the corporate travel does have a lower take rate.

On the other hand, it does have a higher ticket. Corporate travels are less minute traveling. And the ticket, of course, is higher. The routes are more expensive, the destinations are more sought after, they have a higher ticket. Even with a lower take rate, this is a substantial and very positive business to work in.

[Joao Pedro Soares, analyst]

Simply to complement something, Leonel, the opportunities will increase our opportunity for land traveling. We're very strong in this, and it opens up the doors to further increase our traveling by land. And as we move forward in this, we can make the B2B take rate even more robust?

[Leonel De Andrade Neto, executive]

Well, yes, the comment is very appropriate. The new platform will favor us because the company's new platform is very robust for air traveling but does not speak about land traveling. And we want to speak about [indiscernible] hotels. And well, the platform is not very friendly for this but very soon, we will have a single platform, and it will get the very best from both fronts, and we will create a new opportunity for the sale of B2B land travel, favoring the take rate.

[Operator]

Our next 2 questions are from João Andrade from Bradesco BBI via webcast.

[João Paulo Andrade, analyst]

Which are the main growth factors for slower growth in B2C? And when can we expect a recovery of the B2C mix and the consequent improvement in the take rate?

[Leonel De Andrade Neto, executive]

Thank you for the question, João. It makes a great deal of sense. Now what happened in B2C is very simple. Before the pandemic, we had 1,400 stores, this has dropped to 1,100 stores. And perhaps you will remember this, I don't know if you participated in a call we held 1.5 years ago. Someone asked a question, and I thought we would end the pandemic with a lower number of stores. If I'm not mistaken, I thought we would go down to 800 stores but our stores were highly resilient. They were confident in the business. Now sales through same stores, we have a very positive behavior, very close to the growth in the market. What happened is that we lost 18% of distribution. And finally, now, we begin to have new openings. We have a great search on the part of franchisees. New franchisees who are thinking of investing, we're screening them, and it's very good to invest in the CVC franchise.

You don't have royalties. You don't have to pay marketing rates, we never had them. Eventually, perhaps we should have them, we should discuss this. The contracts are firm contracts and the tourism franchise doesn't have to have a stock in inventory. Now, with the new stores and the new platforms, I think this will become ever more attractive but this is the great factor, a loss of distribution that is growing once again. When we will be back, well, perhaps the platforms will help us, well, certainly, they will help us but perhaps, they will not cover everything. With the opening of stores, it will take us 1 or 2 years to have a very firm distribution. However, the new platform for the first time will allow us to have a highly attractive business. Our store has never been mobile. What do I mean with this?

To buy a store, you have to go to the app, sit in front of an operator who is using a desktop, with a change of platform in October, anybody can get up from the store, go to their office and find the best trip using a tablet and iPad because the platform is 100% integrated with Internet and with an app, which means that we will gain capillarity, robustness and a better experience for the clients. Everything converges so that we can once again have growth in B2C. We will have robust growth vis-a-vis the market, but it will take us some time to close that distribution gap. Now, let's recall that the take rate here continues to be very strong. We have not had a drop of take rate in B2C. And the minor drop was due to products. We have large international growth where the take rate is lower but the ticket is higher. So B2C is very healthy and highly aligned with distribution.

[João Paulo Andrade, analyst]

The second question from João is the following. How are the sales in Argentina can we expect a strong second half of the year?

[Leonel De Andrade Neto, executive]

Well, thank you for the question, João. Yes, I do believe we can. In Argentina, we have all the businesses. We also have a strong B2B business, and we're leaders in all of the businesses as we are in Brazil. B2B is strong through Ola, and we have a robust and streamlined B2C. Now, what has grown most is Ola in Argentina and because of credit and utilization of capital, we're being very conservative. In Mundo, the opportunities are enormous. The company has a sound margin and we're incentivating this, but sometimes, we need cash as well. So we are going to continue to grow but we will be more conservative in Argentina than in Brazil because of the credit risk and the country risk. We still have opportunities for growth in Argentina.

[Operator]

Our next question comes from Audio from [ Nicolas ] from JPMorgan.

[Unknown Analyst]

Which is your vision of the competitive environment for the second half of the year?

[Leonel De Andrade Neto, executive]

Well, thank you for the question. And let's separate this. When we speak about B2C, the competitive environment is concentrated and we will probably have some competitors. Many people worked with madness during the pandemic. And perhaps that was not sustainable for them and we begin to see the impact on the market. We will continue to have a significant competitive edge. We're the only company with distribution and assistance. And with the streamlining that I have referred to, we will have an opportunity from the digital viewpoint with our omni-channel system. Now, in B2B, my concern is that people do a lot of madness. They don't do the accounts. That's the truth. We're not going to do that because that is not sustainable. You're going to fall and break your face, it's happened in the past with this.

Now, confidence is everything, credibility is important and many people are tossing that out and want to grow at any cost. On the other hand, the market will also be concentrated in the hands of few. This is a market with significant concentration. I don't think the competitive environment in the medium and long term, well, it will be favorable in the short term as everybody is trying to survive. People are playing around a great deal with prices.

[Operator]

Our next question comes from the webcast from João Pedro Soares.

[Joao Pedro Soares, analyst]

Regarding the charter flights, which has been the effect and success and which is a load factor of these flights?

[Leonel De Andrade Neto, executive]

As we increase the number of flights significantly, we relaunched them. I don't doubt that this is excellent business and that clients bring about competitive advantages. Now, load factor is more than good and we are making corrections day after day. We will continue to invest in this business, which gives us a significant competitive edge. We had the following effect as until April, we had uncertainties because of Omicron. The chartered flights were prepared at the last minute. We have chartered flights for summer of coming year, December, January, February and Carnival, we already have several agreements and chartered flights that are being marketed. The idea is to work with this 6 months beforehand.

And this was not feasible in midyear. We had charter flights with 40 to 60 days of sales and the load factor was not good in that case. It's constant learning and we will continue to invest and grow.

[Operator]

With that, we would like to end the question-and-answer session. We will return the floor to Mr. Leonel Andrade for the closing remarks.

[Leonel De Andrade Neto, executive]

I would like to thank all of you, say that the balance that we presented yesterday shows the soundness of our growth. There is a challenge to our image. And as I said, our commitment remains. This is not something that is a reason of concern. And it brings about perhaps a natural doubt regarding the possible doubt that we will need more capital in the company and how this capital will be achieved. We're addressing this, having discussions but once again, this cannot be disseminated because there is no certainty and you don't have to divulge anything during this negotiations. What is very positive is that if this happens with shareholders and possible creditors, we do have sufficient credibility. There is nobody that does not want to and will not grant us credit. We're very confident and I would once again like to underscore, there is nobody in the market that has honored its commitment as we did.

We work with transparency. We will lose the business if necessary but we will not lose our credibility. Our governance commitment is a sovereign commitment and we're going to continue with it in the long term. And I'm very optimistic with whatever comes ahead of us. And with the cost that we have and with significant growth in revenues forecast for the coming quarters, this will leverage our EBITDA, and this is an enormous opportunity for the company. I would like to thank all of you. Have a good day. And if you wish to travel, please count with us. Thank you very much.

[Operator]

The earnings release for CVC Corp. And here, we would like to thank all of you for your participation. Have a good afternoon, and thank you for using Chorus Call.