LPS Brasil Consultoria de Imoveis SA

BOVESPA:LPSB3

Earnings Call Transcript 2021-Q2

[Operator]

Good afternoon, ladies and gentlemen. Thank you for waiting. Welcome to the conference call of LPS Brasil where results will be provided about the second quarter 2021.

We have here with us today, Marcos Lopes, CEO; Francisco Lopes Neto, VP; Robson Paim, financial CFO; Matheus Fabricio, Investor Relations Officer; and Cyro Naufel, Company VP.

We'd like to inform you that this conference is being recorded. [Operator Instructions]

The event is also being simultaneously broadcast through Internet and may be accessed in the address ri.lopes.com.br. You can also download the presentation from there.

Slide selections will be controlled by you. A replay of the event will be available right after its closing. We would like to remind you that participants of webcast may submit their questions through the website, and they will be answered after the conference presentation.

Before proceeding, we would like to mention that forward statements -- forward-looking statements are based on beliefs and assumptions of LPS management and on information currently available to the company. They involve risks and uncertainties because they relate to future events and therefore, depend on circumstances that may or may not occur. Investors and analysts should understand that conditions related to macroeconomic status, industry and other operating factors may cause results to differ materially from those expressed in such forward-looking statements.

I would like now to hand it over to Marcos Lopes, who will make the general introduction and also the presentation of operating results, followed by Francisco Lopes, who will share with us CrediPronto results, followed by Mr. Matheus Fabricio, who is going to address financial results. Finally, we are going to open for the Q&A session.

Let me now hand it over to Mr. Marcos Lopes. Please, you can start now.

[Marcos Lopes, executive]

Good afternoon, everyone. 12:05, we are live, and I would like to thank you all for being with us for the conference call of LPS Brasil, where we are going to share with you the results of the second quarter 2021.

We have here with us, Francisco Lopes Neto, our VP; Matheus Fabricio, who is our IR Officer, Robson Paim, CFO; and our company Director and VP, Cyro Naufel. It's a pleasure to start by highlighting that the second quarter of 2021, Lopes presented its best quarterly results for the past years, precisely since the fourth quarter 2013. In addition, it was the ninth consecutive quarter presenting consolidated net profit. The unique combination of our strategic progress and innovation based on technology and our Lopes Labs platform.

Our position of leadership in Lopes network in intermediating new and used real estate and the excellent performance of CrediPronto, which is our fintech of -- or mortgage fintech have generated consistent results, showing progression of our operating indicators and profitability in all segments of the company.

Platform Lopes Labs continued to perform as a key role in our company strategy, benefiting from the largest database of real estate in the market our incomparable volume of transactions performed and the effect of network of a network and an ecosystem that has over 260,000 real estate properties, 100 stores, 12,000 associate brokers providing greater intelligence, efficiency and better experience to our clients to drive what we call tri-match, client, real estate and associated broker and their meeting.

To better understand the results of the company and following our commitment with transparency, we have also decided to include the comparison with the second quarter '19 in some of the operating indicators as the second quarter of '20 was strongly impacted by COVID-19 pandemic.

After my initial remarks, we can now go into the presentation starting from Slide 5 with the highlights of the second quarter 2021. I would like to start by emphasizing that in the second quarter '21, we presented our best quarterly results since the fourth quarter 2013. Our net profit of controllers before IFRS reached BRL 15.9 million, 729% above the second quarter '20. The company EBITDA reached BRL 23.1 million, 187% above the same period last year. And net revenue reached BRL 53.9 million, 80% above the second quarter '20.

Our own operations launched BRL 3 billion in the period, a value that has already been adjusted by Lopes' participation in this project. This volume represents 996% over the second quarter 2020, which was obviously highly impacted by the pandemic. And it also amounts to 49% above the second quarter '19 which had shown good results. It's important to highlight that the company has already mapped 51% of its operational forecast or preview for launches in the year was -- which was BRL 7.5 billion, given as a guidance. We've already met 51% in the first half of the year 2021.

Total PSV intermediate of the company reached BRL 2.6 billion in the quarter, 122% increase over the second quarter '20 and 23% over the second quarter 2019. CrediPronto continues to present expressive and robust results. And in this quarter, it generated BRL 1.6 billion, 195% over the second quarter last year and 289% over the second quarter 2019.

In the first half year alone, we have already generated more mortgage and funding than the whole year of 2020, which already had broken the record for the company. The average balance of our portfolio has already exceeded BRL 9.5 billion. At Lopes Labs, we keep on breaking records in generating leads. Over 40,000 leads generated at Portal Lopes amounting to 325% over the same period last year, in addition to making very relevant contributions to the operating performance of the company as I am going to report next.

Slide 7 brings the launches for the second quarter 2021. The graphs on the left show total volume launched by the company on the second quarter of '21 amounting to BRL 5.5 billion, presenting growth of 1,157,000 (sic) [ 1,157% ] over the second quarter '20 and 51% over the second quarter of 2019. Of the total launch of the amount, 85% of PSV concentrated in the state of São Paulo, 7% in Fortaleza and 8% in other states. In the state of São Paulo, the city of São Paulo received 76% of launches.

On the right, we can see that Lopes participation in the projects launched had reached BRL 3 billion or -- BRL 3.76 billion in the first half of 2021 or 51% of the operating preview of BRL 7.5 billion that we disclosed for the whole year of 2021.

Carry on with presentation, let's go to Slide 8. Here, we can observe the results of intermediation. The graph on the left brings consolidated results of the company, PSV of our own operations plus PSV of those of franchising. Annually, there was a growth of 122%, totaling BRL 2.6 billion in the period. Franchising, we broke 1 more operating records in the second quarter 2021 with an intermediate PSV of BRL 1.3 billion or 134% increase compared to the second quarter '20 and 54% compared to the second quarter 2019. Our own operations, which act primarily in primary market, total PSV of BRL 1.3 billion or 111% growth over the second quarter of '20 and 3% over the second quarter '19.

Next slide, #9. We show the total PSV curves for 2019, 2020 and 2021, including our own operations and franchising, showing you a very significant growth that the company has been presenting in its intermediations year-over-year. As we can see, the first 6 months of 2021 present volume of intermediation with 111% above the same period last year and 32% over the first quarter 2019. In the chart on the bottom, we can see the total PSV of the company on a quarterly basis as a last 12 months since 2017. As we can see, we've experienced a very significant quarterly growth as of the second quarter of 2020, getting more pace than historical values, totaling BRL 9.8 billion according to the second quarter '21 LTM.

Next slide, Slide 10. We present the results of intermediated segmented by region and also our geographic distribution. We have closed the quarter present in 13 states and in Brazil we've 121 stores, 18 of our own and 103 franchising. Once again, increasing 14% over the previous quarter, which confirms the strengthening of our network, more efficiency and aggressiveness in our process of expansion. We have happily started the operations in the states of Amazonas, Tocantins and Piauí. State of São Paulo represented 57% of our PSV intermediated of our own operations in the second quarter of 2021 remaining as the market that's most representative for the company. South represented 13% with some highlights to Londrina and other markets represented 28% with special highlight to Fortaleza and Espírito Santo.

In the franchise, the state of São Paulo has also led intermediations, totaling 50% of PSV for the quarter. Rio de Janeiro maintained second most relevant with 26% of PSV intermediated in the period. The remaining regions continued to expand their relevance totaling 25% of PSV intermediated in the period.

Let's now move on to Slide 11, where we can see the results of our speed of sales or sales over supply and sales over launches. We are going to start by analyzing the city of São Paulo on the left, and we can see the SOS, sales over supply, which increased over the second quarter 2020, reaching 13%. Now sales over launch or SOL, sales over launch, increased 6.5 percentage points in view of the second quarter '20 totaling 18.1%.

Now the charts on the right, we have consolidated analysis. Our SOS of the company had a 2.7 percentage point increase, reaching the quarter in 10.7%. Sales over launch showed an increase of 4.3 percentage points compared to the second quarter '20, reaching 13.2%. Still on the slide, we can see the distribution of intermediations between recently launched products and products launched for longer than 6 months. In the city of São Paulo, launch has made up to 6 months contributed to 75% of our intermediate PSV in the quarter. For the whole Brazil, up to 6-month launch amount 58% of the total.

Carry on. Let's now go to Slide 12. Here, we can see the progression of the company and significant indicators related to Lopes Labs throughout the quarter. The chart on the left, we can see that visitation to portal and to Lopes blog grew 158% compared to the second quarter '20, and 19% compared to last quarter overcoming the number of 3 million visitors. The graph on the bottom, we can see the 19% increase in conversion of visitors into leads compared to the second quarter '20 reaching the level of 1.65%. As a consequence, the increase of visitors and improvement in our conversion rate, we have observed a significant progression in the number of leads originated by Lopes portal, overcoming the number of 40,000 leads. This number represents a growth of 325% when compared to the same period last year and 25% if compared with the previous quarter.

The chart below on the right, we can see that 55% of the company leads had already been through digital channels as opposed to 45% of offline. Lopes Labs is our digital side and a hub of innovation for the company, which has contributed enormously to operating results of Lopes Group. Lopes Labs provides to consumers, to real estate owners of properties and brokers, a number of powerful tools of technology that can really enhance the experience of buyers.

It is a digital experience, making it much smarter and faster. It's an ecosystem with over 260,000 properties together with a network of over 12,000 associated brokers who are specialized in this business. In addition to partner brokers and also partner real estate operations. The technology that provides access to these tools brings very important gains to the every day work of our associates and brokers. They can double check information, which is key to give to the client a unique experience concerning their expectations. It's as if it were really personalized.

Our platform uses artificial intelligence delivered to analyze the profile of the client, expected location to leave characteristics of real estate, and artificial intelligence can directly guide similar offers depending on analysis of data and specificities of each buyers, enhancing the efficiency of our sales and our results. Likewise, in terms of launches, clients may benefit from it and get active offers, which are much more assertive and based on data analytics bringing to buyers what really makes sense to them according to what they are looking for.

These were my initial remarks about the presentation of operating results. And now I would like to hand it over to Francisco. He's going to address CrediPronto, and then Matheus, who is going to share with us financial results of the company. Thank you.

[Francisco Neto, executive]

Thank you, Marcos. Good morning, everyone. It's a pleasure to be here to share with you the results of CrediPronto, our mortgage operation, which really makes us very proud. We have also reached very positive results. Slide 14 brings our key indicators. Origination volume once again was very high. Year-to-date, over BRL 3 billion, BRL 1.6 billion in the quarter. Midterm indicators and LTV have also maintained within the expected levels. I always like to emphasize that our real estate mortgage market has gained more maturity.

It's becoming more and more mature. So duration, index, LTV rates have really emphasized the level of healthy of the market, [indiscernible] market of 65% is very safe, which means that the final result of portfolio and default payments are quite solid. In terms of portfolio right -- down on the right, we can see that within 1 year, we had 43% growth in our portfolio, 6.6 to 9.5. The growth resulted from the positivity of those closed contracts, settled contracts and new contracts. In the Brazilian mortgage market is something really important and should be analyzed because this repository is absolutely essential for the portfolio. As we pointed out in the previous quarter, for each settled closed contract, we have 10 new contracts, and this has been maintained as is in the second quarter '21. So it means that our portfolio keeps on growing. On the left, as we can see, we had 12% of mortgage volume, a very strong quarter, which was enough to make us grow in the second quarter '21.

Now going to Slide 15. Please note in the chart on the upper portion is that the volume of BRL 3.034 million is higher than the whole year of '20 in terms of volume. Just in the first half of the year, it's higher than the whole year last year. Portfolio growth has also generated from the increasing mortgage volume, which shows also our penetration in the market. Thanks to the expertise of CrediPronto in giving a good value proposition, efficiency, qualification, which really provides the right conditions to bring more positive results of mortgage volume and expansion of portfolio. And this is exactly what brings us to Slide 16, where we can see the profit sharing of our virtual P&L.

What is presented in terms of financial in the quarter is the profit sharing of the months of March, April and May. And we also include the profit of June, BRL 8 billion, which is what will be accounted for in the financial and economics in the next quarter. The total revenue of CrediPronto also includes commissions for banks. So in addition to the profit of BRL 14.4 million which we see here for the 3 months, we also have revenues of BRL 16 million from banking commission base.

I would like to thank you all, and now ask our Investor Relations Officer, Matheus Fabricio, to present the financials. Thank you very much.

[Matheus de Souza Fabricio, executive]

Thank you, Francisco. Good afternoon, everyone. Let's start by analyzing financial results on Slide 18, where we can see gross revenue reconciliation in the second quarter '20. Our own operations, BRL 1.33 billion and the net commission rate, 2.01%. It's important to emphasize that net commission in the city of São Paulo was 3.36%. But the impact of commission somewhat lower in other regions, especially because of low income or low-income launches amount to the total number of 2.01.

So considering our own operations and the average commission, we get to the gross brokerage revenue, BRL 26.7 million. We should also add revenues from other segments, so royalties and other foreign CrediPronto profit sharing and commissions over new mortgage. So that's all under other revenues, BRL 34.9 million. So total for the quarter, BRL 65.2 million gross revenue, adding the value of upfront -- of CrediPronto, which does not have a cash effect.

Next slide, Slide 19. We have net revenue, cost and expenses. The net revenue of the company reached BRL 59.3 million in the second quarter '21 or 68% increase over the same period last year. The bar graph also shows the contribution of each segment. CrediPronto, 47% of net revenue, intermediation 45% and franchising the remaining 8%.

We also have here operational expenses before IFRS. We can see an increase of 45.2% in expenses of the quarter over the same period last year, which is explained primarily by 3 reasons: first, increase in commissioning at the origination at the capture of volume of Lopes under other revenues. And this is a result of competitiveness of other brands. And this is why we have decided to go through this path.

In addition, there is the implementation of remote or working from home to 100% of our workers and also a reduction of working hours because of the COVID pandemic, which has impact personnel, infrastructure and office material during the period last year, which will be normalized up to the second -- third quarter of '21. And also an increasing lines of telecom and advertising as a process of going more digital, investing more in online media fostered by Lopes Labs initiatives.

The next, we see EBITDA -- on the left, EBITDA of the company, which totaled BRL 23.1 million in the quarter, 39% margin, 187% increase over the second quarter '20. On the right, we can see net income of controlling shareholders as a result of IFRS, which is BRL 15.9 million, 729% of the same period last year, 27% is the net margin. Slide 21, we can see the progression of net income before IFRS last 12 months since the first quarter '18. As we can see, company results has been sustained and consistent, reaching BRL 58.5 million in the second quarter '21.

Next slide, Slide 22. We can see the results by segment in a quarterly basis without IFRS. All segments where we operate have contributed positively as Marcos had anticipated. Intermediation had EBITDA margin of 21.7%, BRL 5.7 million; franchising, 81.4%, BRL 3.7 million; and finally, CrediPronto EBITDA margin of 48.4%, totaling BRL 13.6 million. After discounts of depreciation and financial results and tax, we got to net profit of BRL 18.9 million in the quarter, 31.9% net margin. And after minority shareholders, a result of 15.8% of controlling shareholders with a 26% margin.

Next slide, we show the impact of IFRS in our results. The main impacts are related to depreciation and amortization of intangibles, noncash impact of call input of our controlling companies and deferred in cash -- in taxes. The impacts amount to BRL 13.3 million in the quarter, but with no cash effect. And this is how we recommend the analysis of our results without said impacts to better understand the operating results of the company.

Finally, Slide 24, we have cash variation and the availability, cash available at the end of the quarter. On the left, cash flow generated by operating activities positive for the seventh consecutive quarter, BRL 5.9 million, possibly impact by the profit of CrediPronto and the good results of intermediation of our own operations and franchising. As to investments, cash of BRL 6 million were spent, special investments made in the digital transformation of the company.

Funding activity is BRL 2.5 million and dividend distribution to noncontrolling shareholders. Cash balance at the end of period considering investments was BRL 131.6 million. These were my considerations about the financials of the company.

Once again, we'd like to thank you all for your participation, and now we are going to open for your questions. Thank you.

[Operator]

[Operator Instructions] The first question comes from Gustavo Cambauva, BTG Pactual.

[Gustavo Cambauva, analyst]

I have 2 questions. First, concerning the market at large, you've announced that in the second quarter, the volume of launches was very strong, which ultimately reinforces what you had said in terms of gain of share of Lopes in the main markets. What I want to understand though, thinking about the second half of the year, what is your take on the new launches because you are running at a very high level, companies are talking about launching even more in the second half. So what do you expect in terms of your pipeline?

And do you -- or are you concerned about the second half? Do you think that you might get impact? Some companies are more concerned about costs, just postponing launches, reviewing projects. Do you anticipate anything that will make you have a less strong second half? I have a question concerning CrediPronto. Itaú, 1 month ago, announced an increase in the mortgage and loan rates. Does it impact your volumes or considering the low interest rates? Do you expect changes or not because of the increase in the lower rates practiced by Itaú -- Banco Itaú?

[Marcos Lopes, executive]

I'm going to start by talking about market. Excellent question. It gives us the opportunity to tell us a bit more about what we anticipate. The first half of the year was wonderful. And in the second quarter, it still felt the impact that some of our showroom stores were closed up to the second quarter of -- second week of May. So of course, it restrained somewhat the number of launches and then developers in June and July had to start launching more. And it has really applied some pressure to the volume. But we have a consistent volume for the second half of the year. We are very optimistic about it, and I'm going to explain why.

When we talk about costs, our main concerns -- and the main increase in rates have already happened in May and June. We had over 2% variation in IPC, then it went down to 8.6%. So I believe in the second half of the year, this won't be a concern so much more because then we are going to strike a balance between production and offers and demand. Interest rates, Selic, we're still interacting with our investors because IPCA year-to-date is 9%, 8.89% and interest rate 5.25%, even if it goes down to -- go up to 6.25%, we still have negative real interest rate, which is something good for investors in Rio state. We have a very good inventory, not only in the city of São Paulo, our main market as numbers show and where the inventory takes 8.4 months to be completely sold.

So it's very comfortable to accept the volume of funding that we see ahead. But outside São Paulo, Fortaleza, Espírito Santo, Londrina, Rio de Janeiro mentioned in our numbers, they are regions where the inventory rates also went down. And that will mean the new pipeline will be comfortably absorbed.

And talking with developers, we don't see any movement of retraction or postponement. Of course, at the end of fourth quarter, we might have that because of -- scheduled because launches have to be approved by the city administration. And these are things that are not necessarily controlled and may be postponed to some extent. But we tend to be very comfortable.

[Francisco Neto, executive]

This is Francisco speaking. Thank you very much for your question about CrediPronto. I believe that there is room for increase in mortgage rates without having a considerable impact in terms of demand. It is a reduced rate to some extent. In Brazil, if you add a 30-year funding for 7.3, which is what Itaú uses as a credit rate is very good business, very good deal because there might be prepayment at any time. And it should be fixed rate plus the variation, TR, this is the variation. So comparable to any other credit rates, it's still very attracting at low rates. Rates are probably going to resume the previous level through all times. Other banks, such as Santander are at 7.99%, Banco do Brasil with 8%, and it's expected to have going back to the previous rates.

And the real estate market in Brazil is getting more and more mature. Compared to other countries, we still have low penetration. There is room for growth. The duration has been increasing. We see the portfolios. 2018 was 5.5 to 6; 2019, 6 to 7; 2020 went up from 7 to 8 years. So this is an indication that the market is getting more and more mature. It has a lot to value, which is very attractive to maintain the health of our portfolio and profit. So in my opinion, the market is still positive, very prospective good look. And the real estate activities concerning the demand it has and increasing credit rates because there are additional resources, right? In January '20, year-to-date in savings account BRL 156 billion in June, the social resources and saving accounts was BRL 80 billion. Therefore, we really believe that the add-up of funding and the demand of real estate will sustain the growth and expansion of credit portfolio, despite an increase in rates. Thank you.

[Operator]

The next question comes from Elvis from BTG Pactual.

[Elvis Credendio, analyst]

I have 2 questions. First, about Lopes Portal. I would like to understand why there had been an increase in number of visitors to the portal. Is it a result of marketing investments? Is it an improvement to its own services? Could you please tell us what are the next steps that you expect to see this growth and what you've been doing at Lopes Labs? You said that the operations of franchising improved the operations and generate more volume because of the digital tools as well. Can you send us some -- can you share with us some metrics, how you've been really noticing and measuring the improvement? And what do you expect in terms of future increase in franchise partners?

[Marcos Lopes, executive]

Elvis, this is Marcos Lopes. I'm going to start, and then I'm going to ask Matheus to talk about the franchising. Our growth results from very low marketing investments because our main focus of growth is justified by the organic growth concerning the improvement on the website, portal, Google placement, et cetera as well as the website. Utility is faster, it's working better. And it's reaching the interest and the demands of those who are looking for real estate. 6,000 new real estates joined our portfolio in the new listing.

And it helps, and it emphasizes the importance of our portal, bringing it all together. Artificial intelligence, which has also been very important to convert more and to generate more interest as well as a more well-organized [indiscernible] has really increased to the number of visitors and conversion rate. So these are my considerations about our portal, but -- this is all part of a broader understanding. That's the -- it involves a number of benefits in the app for our ecosystem of owners, potential buyers, brokers, franchises and all stakeholders of Lopes network. Matheus, could you please tell us more about the franchises?

[Matheus de Souza Fabricio, executive]

Thank you, Elvis, for the question. And I would like to give you 2 examples of metrics of how franchisers benefit from the results of using our platform. First, and correlated with Lopes Labs and as Marcos said is the fact that all their real estate are announced in our portal. As our portal gets more relevant, attracts more visits and a better browsing experience leading to more lead conversion, users are directly impacted. And all the real estate, which are part of the platform are equally impacted.

And secondly, in terms of volume of business done in partnership because they are part of this shared environment. In São Paulo, the city of São Paulo, where our network is more relevant, we have more stores and well distributed throughout the city, we reached 30% of all the sales of our franchisee as a result of partnership. So 1 real estate has a buyer and another real estate operation has a real estate to offer, something that wouldn't happen if they were all part of a network because, of course, you wouldn't agree to share your client with someone or with an operation, you are not familiar with. So these are very concrete actions that help us grow more than the market in secondhand real estate.

So this is my answer, and I would like to take the opportunity to read some questions that we have received.

There are 2 questions to you, Marcos. [ Carlos Sosa, ] Marcos, CrediPronto, if it keeps on growing faster than the revenues of intermediation and franchising, are you going to become a fintech more than a real estate really intermediation company? Could you give us more details about the digital transformation that you've been through in Lopes Labs? How far have you reached? And where else do you expect to get?

[Marcos Lopes, executive]

Good. Thank you. Concerning CrediPronto. CrediPronto has been growing. It is a fintech within the organization. It has presented very significant growth, and we'll keep on doing so because we are very well positioned, meeting lots of interested brokers, partners, franchisees and other real estate operations in the market in a system that really is as fintechs operate. And our company as a whole in terms of digital transformation intends to become a high-tech company. Lopes Labs has contributed decisively to have more customization of Lopes ecosystem so that we can have better -- more fluid experience to our buyers. Because a good experience will really help us make their decision to -- one of the most important decisions in their lives.

So we are being recognized as a fintech and a tech company. So fintech in mortgage and a tech company, thanks to Lopes Labs, our hub with digital transformation and technological innovation. Something which is bringing more elements and tools for the whole organization of the company so that buyers, owners, developers, associated brokers can meet together within the Lopes environment, increasing efficiency, smart practice, be very constructive to all stakeholders. Those who joined the platform as a broker or who become a franchisee have expanded significantly. Those who join have a lot to gain and those who are selling their real estate through that also gain. We've shown through our market share growth, importance to the developers that also benefit from this platform as well as buyers and prospect sellers.

[Matheus de Souza Fabricio, executive]

[ Weyland ] from Itaú BBA sent 2 questions. The first 1 you had answered already about how we see the progression of the interest rate and the credit rate, lowering rates and Francisco has already answered that. He also asks about the expansion and growth of franchisee, which is the question asked by another shareholder and also asked by Elvis.

So I'm going to talk about that. As you've noticed in the past 3 quarters, we have had very significant growth of 14% per quarter, and this is the pace we expect to maintain in terms of growth. We've been investing more in our expansion team, and we believe the market can now better understand the products and the benefits of our franchising products, and we want to take this moment to leverage further our growth.

In terms of geographic expansion, as we opened 3 operations in 3 more states, we want to be represented in all states of Brazil. We are constantly looking for franchise partners in all states. As to municipalities where we can have a Lopes franchise, cities have different characteristics. But in general, just for you to give you an idea, we would like to be present in cities that have over 300 -- 150 to 300 inhabitants. There is a very great chance of growth. The market is very -- fully distributed and diffuse. So this is what we are focusing on from now on.

So these were the questions that we got here.

[Operator]

[Operator Instructions] We now close the Q&A session. I would like to hand it over to the CEO of the company, Marcos Lopes, for his closing remarks.

[Marcos Lopes, executive]

Thank you all very much for your participation this morning in the conference call for the results of the second quarter. This is the ninth consecutive quarter in which we present profit in our company, resuming the levels that were reached only in 2013. So you can see that we are really moving ahead driven by the expansion of CrediPronto and the operations of Lopes. And I would like to highlight the contribution of Lopes Labs. Let me also emphasize how optimistic we are about the strategic positioning of the company. And we also have good outlooks for the second half of the year with great business ahead. Thank you all very much. Have a good afternoon.

[Operator]

The conference call of LPS Brasil is concluded now. Thank you very much for your participation. Have a good afternoon.

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